PLACEMENT AGENCY AGREEMENT

 

July 3, 2014

 

Mr. Martin W. Prinz

EDI Financial, Inc.

1431 Greenway Drive

Suite 330

Irving, TX 75038

 

Re:     CERULEAN GROUP, INC.

 

Dear Mr. Prinz:

 

This Placement Agency Agreement (“Agreement”) sets forth the terms upon which
EDI Financial, Inc. , a registered broker-dealer and member of the Financial
Industry Regulatory Authority (“FINRA”) (hereinafter referred to as the
“Placement Agent” or “EDI”), shall be engaged by Cerulean Group, Inc., a
publicly traded corporation duly organized under the laws of the State of Nevada
hereinafter referred to as the “Company” or “CEUL”), to act as an exclusive
placement agent (“Placement Agent” or “EDI”) in connection with the private
placement (hereinafter referred to as the “Offering”) of units (the “Units”) of
securities of the Company, as more fully described below. The initial closing of
the Offering will be conditioned upon the receipt and acceptance of
subscriptions for the Minimum Amount (as defined below) and the consummation of
a reverse triangular merger (the “Merger”) between a subsidiary of the Company
and Enumeral Biomedical Corp., a Delaware corporation (“Enumeral”) and certain
other transactions described herein, pursuant to which Enumeral will become a
wholly owned subsidiary of the Company, and all of the outstanding Enumeral
stock will be converted into shares of the Company’s Common Stock.

 

The Offering of the Units will be made by the Placement Agent and its respective
selected dealers, with each Unit consisting of one (1) share of the Company’s
Common Stock and a warrant to purchase one (1) share of the Company’s Common
Stock at an exercise price per share of $2.00, which warrant will be exercisable
for a period of five (5) years from the date of issuance (the “Investor
Warrants”). The Offering Price for the Units will be $1.00 per Unit (the
“Offering Price”). The Offering will consist of a minimum of Ten Million Dollars
($10,000,000) through the sale of Ten Million (10,000,000) Units (the “Minimum
Amount”) and a maximum of Fifteen Million Dollars ($15,000,000) through the sale
of Fifteen Million (15,000,000) Units (the “Maximum Amount”). In the event the
Offering is oversubscribed, the Company, with the consent of Enumeral and the
Placement Agent, may sell additional Units up to an amount no greater than Five
Million Dollars ($5,000,000) through the sale of Five Million (5,000,000) Units
(the “Over-allotment Option”).

 

The minimum subscription amount for the Offering is Twenty Five Thousand United
States Dollars ($25,000 USD); provided, however, that subscriptions in lesser
amounts may be accepted upon the written consent of the Company and the
Placement Agent, in their sole discretion.

 

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The Placement Agent shall accept subscriptions only from persons or entities who
qualify as “accredited investors,” as such term is defined in Rule 501 of
Regulation D (“Regulation D”) as promulgated by the United States Securities and
Exchange Commission (the “SEC”) pursuant to the Securities Act of 1933, as
amended (the “Act”).

 

The Units will be offered until the earlier of (i) the time that the Maximum
Amount, plus any discretionary over-allotment amount is sold or (ii) July 31,
2014, which date may be extended to September 15, 2014 (the“ Offering Period”),
at the sole discretion of the Company and the Placement Agent.

 

With respect to the Offering, the Company shall provide the Placement Agent and
its selected sub dealers, on terms set forth herein, the right to offer and sell
all of the available Units being offered during the Offering Period. It is
understood that no sale shall be regarded as effective unless and until accepted
by the Company. The Company may, in its sole discretion, accept or reject, in
whole or in part, any prospective investment in the Units or allot to any
prospective subscriber less than the number of Units that such subscriber
desires to purchase. Purchases of the Units may be made by the Placement Agent
and its selected sub dealers and its respective officers, directors, employees
and affiliates and by the officers, directors, employees and affiliates of the
Company (collectively, the “Affiliates”) for the Offering and such purchases
will be made by the Affiliates based solely on the same information that is
provided to the investors in the Offering. The placement of the Units by the
Placement Agent will be made on a reasonable best efforts basis.

 

The Offering will be made by the Company pursuant to the Subscription Agreement
and the Exhibits to the Subscription Agreement, including, but not limited to,
the Registration Rights Agreement, Warrant and Voting Agreement, the
Confidential and Non-Binding Summary Term Sheet of the Company dated July 1,
2014, relating to the Offering (as the same may be amended or supplemented, the
“Term Sheet”), the Preliminary Confidential Private Placement Memorandum of the
Company dated July 1, 2014 (as the same may be amended or supplemented, the
“PPM”), and any documents, agreements, supplements and additions thereto
(“Subscription Documents”) which at all times will be in form and substance
reasonably acceptable to the Company and the Placement Agent and their
respective counsels and contain such legends and other information as the
Company and the Placement Agent and its counsel, may, from time to time, deem
necessary and desirable to be set forth therein.

 

1.          Appointment of Placement Agent. On the basis of the written and
documented representations and warranties of the Company provided herein, and
subject to the terms and conditions set forth herein, the Placement Agent is
appointed as an exclusive Placement Agent of the Company during the Offering
Period to assist the Company in finding qualified subscribers for the Units. The
Placement Agent may sell the Units through other broker-dealers who are FINRA
members (collectively, the “Sub-Agents”)and may reallow or reallocate all or a
portion of the Brokers’ Fees including the Broker Warrants (each as defined in
Section 3(a), 3(b) and 3(c) below) it receives to such Sub-Agents or pay a
finders or consultant fee as allowed by applicable law. On the basis of such
representations and warranties and subject to such terms and conditions, the
Placement Agent hereby accepts such appointment and agrees to perform its
services hereunder diligently and in good faith and in a professional and
businesslike manner and in compliance with applicable law and to use its
reasonable best efforts to assist the Company in (A) finding subscribers of the
Units who qualify as “accredited investors,” as such term is defined in Rule 501
of Regulation D and (B) completing the Offering. The Placement Agent has no
obligation to purchase any of the Units. Unless sooner terminated in accordance
with this Agreement, the engagement of the Placement Agent hereunder shall
continue until the later of the Termination Date or the Final Closing (as
defined below).

 

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2.           Representations, Warranties and Covenants.

 

A.           Representations, Warranties and Covenants of the Company. Except as
otherwise disclosed herein or in the Company’s SEC Filings (the “SEC Filings”)
the representations and warranties of the Company contained in this Section 2A
are true and correct as of the date of execution of this Agreement by the
Company and the Company covenants as follows:

 

(a) The Subscription Documents have been and/or will be prepared by the Company,
in conformity with all applicable laws, and in compliance with Regulation D
and/or Section 4(a)(2) of the Act and the requirements of all other rules and
regulations (the “Regulations”) of the SEC relating to offerings of the type
contemplated by the Offering and the applicable securities laws and the rules
and regulations of those jurisdictions wherein the Placement Agent notifies the
Company that the Units are to be offered and sold excluding any foreign
jurisdictions. The Units will be offered and sold pursuant to the registration
exemption provided by Regulation D and/or Section 4(a)(2) of the Act as a
transaction not involving a public offering and the requirements of any other
applicable state securities laws and the respective rules and regulations
thereunder in those United States jurisdictions in which the Placement Agent
notifies the Company that the Units are being offered for sale. None of the
Company, its affiliates, or any person acting on its or their behalf (other than
the Placement Agent, its affiliates or any person acting on its behalf, in
respect of which no representation is made) has taken nor will it take any
action that conflicts with the conditions and requirements of, or that would
make unavailable with respect to the Offering, the exemption(s) from
registration available pursuant to Rule 506 of Regulation D and/or Section
4(a)(2) of the Act, or knows of any reason why any such exemption would be
otherwise unavailable to it). None of the Company, its predecessors or
affiliates has been subject to any order, judgment or decree of any court of
competent jurisdiction temporarily, preliminarily or permanently enjoining such
person for failing to comply with Section 503 of Regulation D. The Company has
not, for a period of six months prior to the commencement of the offering of the
Units sold, offered for sale or solicited any offer to buy any of its securities
in a manner that would cause the exemption from registration set forth in Rule
506 of Regulation D to become unavailable with respect to the offer and sale of
the Units pursuant to this Agreement in the United States.

 

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(b) As to the Company, the Subscription Documents will not and do not include
any untrue statement of a material fact or omit to state any material fact
required to be stated therein or necessary to make the statements therein, in
light of the circumstances under which they were made, not misleading: provided,
however, the foregoing does not apply to any statements or omissions made solely
in reliance on and in conformity with written information furnished to the
Company by the Placement Agent specifically for use in the preparation thereof.
To the knowledge of the Company, none of the statements, documents, certificates
or other items made, prepared or supplied by the Company with respect to the
transactions contemplated hereby contains an untrue statement of a material fact
or omits to state a material fact necessary to make the statements contained
therein not misleading in light of the circumstances in which they were made.
There is no fact which the Company has not disclosed in the Subscription
Documents or which is not disclosed in the SEC Filings that the Company makes
with the SEC and of which the Company is aware that materially adversely affects
or that could reasonably be expected to have a material adverse effect on the
(i) assets, liabilities, results of operations, condition (financial or
otherwise), business or business prospects of the Company, including the
business prospects as a result of the Merger, or (ii) ability of the Company to
perform its obligations under this Agreement and the other Subscription
Documents (the “Company Material Adverse Effect”). Notwithstanding anything to
the contrary herein, the Company makes no representation or warranty with
respect to any estimates, projections and other forecasts and plans (including
the reasonableness of the assumptions underlying such estimates, projections and
other forecasts and plans) that may have been delivered to the Placement Agent,
a Sub-Agent or their respective representatives, except that such estimates,
projections and other forecasts and plans have been prepared in good faith on
the basis of assumptions stated therein, which assumptions were believed to be
reasonable at the time of such preparation.

 

(c) The Company is a corporation duly organized, validly existing and in good
standing under the laws of the State of Nevada (and will be reincorporated into
Delaware prior to the First Closing) and is qualified and in good standing as a
foreign corporation in each jurisdiction in which the nature of the business
conducted by the Company or the property owned or leased by the Company requires
such qualification, except to the extent that the failure to be so qualified or
be in good standing would not have a Company Material Adverse Effect. The
Company has all requisite corporate power and authority to conduct its business
as presently conducted and as proposed to be conducted (as described in the
Subscription Documents and/or the SEC Filings), has all the necessary and
requisite documents and approvals from all state authorities, has all requisite
corporate power and authority to enter into and perform its obligations under
this Agreement, the Subscription Agreement substantially in the form made part
of the Subscription Documents and the other agreements contemplated hereby,
including those documents required by the Merger (this Agreement, Subscription
Agreement, and the other agreements contemplated hereby that the Company is
required to execute and deliver are collectively referred to herein as the
“Company Transaction Documents”) and subject to necessary Board of Directors of
the Company and Company stockholder approvals, if required, to issue, sell and
deliver the Units, the shares of Common Stock underlying the Units, and the
shares of Common Stock issuable upon exercise of the Investor Warrants (the
“Warrant Shares”) and the Broker Warrants (as defined below) and to make the
representations in this Agreement accurate and not misleading. Prior to the
First Closing (as defined below), each of the Company Transaction Documents will
have been duly authorized. This Agreement has been duly authorized, executed and
delivered and constitutes, and each of the other Company Transaction Documents,
upon due execution and delivery, will constitute, valid and binding obligations
of the Company, enforceable against the Company in accordance with their
respective terms (i) except as enforceability may be limited by applicable
bankruptcy, insolvency, reorganization, moratorium or other similar laws now or
hereafter in effect related to laws affecting creditors’ rights generally,
including the effect of statutory and other laws regarding fraudulent
conveyances and preferential transfers, and except that no representation is
made herein regarding the enforceability of the Company’s obligations to provide
indemnification and contribution remedies under the securities laws and (ii)
subject to the limitations imposed by general equitable principles (regardless
of whether such enforceability is considered in a proceeding at law or in
equity).

 

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(d) None of the execution and delivery of or performance by the Company under
this Agreement or any of the other Company Transaction Documents or the
consummation of the transactions herein or therein contemplated conflicts with
or violates, or will result in the creation or imposition of, any lien, charge
or other encumbrance upon any of the assets of the Company under any agreement
or other instrument to which the Company is a party or by which the Company or
its assets may be bound, or any term of the Articles of Incorporation or By-Laws
of the Company, or any license, permit, judgment, decree, order, statute, rule
or regulation applicable to the Company or any of its assets, except in the case
of a conflict, violation, lien, charge or other encumbrance (except with respect
to the Company’s Articles of Incorporation or By-Laws) which would not, or could
not reasonably be expected to, have a Company Material Adverse Effect.

 

(e) The Company’s financial statements, together with the related notes, if any,
included in the Subscription Documents or the Company’s SEC Filings, present
fairly, in all material respects, the financial position of the Company as of
the dates specified and the results of operations for the periods covered
thereby. Such financial statements and related notes were prepared in accordance
with United States generally accepted accounting principles applied on a
consistent basis throughout the periods indicated, except that the unaudited
financial statements omit full notes, and except for normal year end
adjustments. During the period of engagement of the Company’s independent
certified public accountants, there have been no disagreements between the
accounting firm and the Company on any matters of accounting principles or
practices, financial statement disclosure or auditing scope or procedures. The
Company has made and kept books and records and accounts which are in reasonable
detail and which fairly and accurately reflect the activities of the Company in
all material respects, subject only to year-end adjustments. Except as set forth
in such financial statements or otherwise disclosed in the Subscription
Documents, the Company’s senior management has no knowledge of any material
liabilities of any kind, whether accrued, absolute or contingent, or otherwise,
and subsequent to the date of the Subscription Documents and prior to the date
of the First Closing it shall not enter into any material transactions or
commitments without promptly thereafter notifying the Placement Agent in writing
of any such material transaction or commitment other than the Merger. The other
financial and statistical information with respect to the Company and any pro
forma information and related notes included in the SEC Filings present fairly
the information shown therein on a basis consistent with the financial
statements of the Company included in the SEC Filings. Except as disclosed in
the Subscription Documents, the Company does not know of any facts,
circumstances or conditions which could materially adversely affect its
operations, earnings or prospects that have not been fully disclosed in the
financial statements appearing in the SEC Filings or other financial statements
appearing in the SEC Filings or other documents or information provided by the
Company.

 

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(f) Immediately prior to the First Closing, the shares of Common Stock
underlying the Units and the Investor Warrants and the Broker Warrants will have
been duly authorized and, when issued and delivered against payment therefor as
provided in the Company Transaction Documents, will be validly issued, fully
paid and nonassessable. No holder of any of the shares of Common Stock
underlying the Units, the Investor Warrants and Broker Warrants will be subject
to personal liability solely by reason of being such a holder, and except as
described in the Subscription Documents, none of the shares of Common Stock
underlying the Units, the Investor Warrants and the Broker Warrants will be
subject to preemptive or similar rights of any stockholder or security holder of
the Company or an adjustment under the antidilution or exercise rights of any
holders of any outstanding shares of capital stock, options, warrants or other
rights to acquire any securities of the Company. Immediately prior to the First
Closing, a sufficient number of authorized but unissued shares of Common Stock
will have been reserved for issuance upon the exercise of the Investor Warrants
and the Broker Warrants.

 

(g) Except as described in the Subscription Documents and/or the Company’s SEC
Filings, the Company has no subsidiaries and does not own any equity interest
and has not made any loans or advances to or guarantees of indebtedness to any
person, corporation, partnership or other entity. The conduct of business by the
Company as presently and proposed to be conducted is not subject to continuing
oversight, supervision, regulation or examination by any governmental official
or body of the United States, or any other jurisdiction wherein the Company
conducts or proposes to conduct such business, except as described in the
Subscription Documents and/or the Company’s SEC Filings and except as such
regulation is applicable to US public companies and commercial enterprises
generally, The Company has obtained all material licenses, permits and other
governmental authorizations necessary to conduct its business as presently
conducted. The Company has not received any notice of any violation of, or
noncompliance with, any federal, state, local or foreign laws, ordinances,
regulations and orders (including, without limitation, those relating to
environmental protection, occupational safety and health, securities laws, equal
employment opportunity, consumer protection, credit reporting,
“truth-in-lending”, and warranties and trade practices) applicable to its
business, the violation of, or noncompliance with, would have a Company Material
Adverse Effect, and the Company knows of no facts or set of circumstances which
could give rise to such a notice.

 

(h) Except as described in the Subscription Documents and/or the Company’s SEC
Filings, no default by the Company or, to the knowledge of the Company or any
other party, exists in the due performance under any material agreement to which
the Company is a party or to which any of its assets is subject (collectively,
the “Company Agreements”). The Company Agreements, if any, disclosed in the
Subscription Documents, the documents to be executed by the Company in
connection with the Merger and/or the Company’s SEC Filings are the only
material agreements to which the Company is bound or by which its assets are
subject, are accurately described in the Subscription Documents and/or the
Company’s SEC Filings and are in full force and effect in accordance with their
respective terms, subject to any applicable bankruptcy, insolvency or other laws
affecting the rights of creditors generally and to general equitable principles
and the availability of specific performance.

 

6

 

 

(i) Subsequent to the respective dates as of which information is given in the
Subscription Documents, the Company has operated its business in the ordinary
course and, except as may otherwise be set forth in the Subscription Documents
and/or the Company’s SEC Filings, there has been no: (i) Company Material
Adverse Effect; (ii) material transaction otherwise than in the ordinary course
of business consistent with past practice; (iii) issuance of any securities
(debt or equity) or any rights to acquire any such securities other than
pursuant to equity incentive plans approved by its Board of Directors; (iv)
damage, loss or destruction, whether or not covered by insurance, with respect
to any material asset or property of the Company; or (v) agreement to permit any
of the foregoing.

 

(j) Except as set forth in the Subscription Documents and/or the Company’s SEC
Filings, there are no actions, suits, claims, hearings or proceedings pending
before any court or governmental authority or, to the knowledge of the Company,
threatened, against the Company, or involving its assets or any of its officers
or directors (in their capacity as such) which, if determined adversely to the
Company or such officer or director, could reasonably be expected to have a
Company Material Adverse Effect or adversely affect the transactions
contemplated by this Agreement or the enforceability hereof.

 

(k) The Company is not: (i) in violation of its Articles of Incorporation or
By-Laws; (ii) in default of any contract, indenture, mortgage, deed of trust,
note, loan agreement, security agreement, lease, alliance agreement, joint
venture agreement or other agreement, license, permit, consent, approval or
instrument to which the Company is a party or by which it is or may be bound or
to which any of its assets may be subject, the default of which could reasonably
be expected to have a Company Material Adverse Effect; (iii) in violation of any
statute, rule or regulation applicable to the Company, the violation of which
would have a Company Material Adverse Effect; or (iv) in violation of any
judgment, decree or order of any court or governmental body having jurisdiction
over the Company and specifically naming the Company, which violation or
violations individually, or in the aggregate, could reasonably be expected to
have a Company Material Adverse Effect.

 

(l) Except as disclosed in the Subscription Documents and/or the Company’s SEC
Filings, as of the date of this Agreement, no current or former stockholder,
director, officer or employee of the Company, nor, to the knowledge of the
Company, any affiliate of any such person is presently, directly or indirectly
through his/her affiliation with any other person or entity, a party to any loan
from the Company or any other transaction (other than as an employee) with the
Company providing for the furnishing of services by, or rental of any personal
property from, or otherwise requiring cash payments to any such person.

 

(m) Except as disclosed in the Subscription Documents, the Company is not
obligated to pay, and has not obligated the Placement Agent to pay, a finder’s
or origination fee in connection with the Offering (other than to the Placement
Agent), and hereby agrees to indemnify the Placement Agent from any such claim
made by any other person as more fully set forth in Section 8 hereof. The
Company has not offered for sale or solicited offers to purchase the Units
except for negotiations with the designated Placement Agent. Except as set forth
in the Subscription Documents, no other person has any right to participate in
any offer, sale or distribution of the Company’s securities to which the
Placement Agent’s rights, described herein, shall apply.

 

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(n) Until the earlier of (i) the Termination Date or (ii) the Final Closing (as
hereinafter defined), the Company will not issue any press release, grant any
interview, or otherwise communicate with the media in any manner whatsoever with
respect to the Offering without the Placement Agent’s prior written consent,
which consent will not unreasonably be withheld or delayed, and subject to any
applicable laws and regulations.

 

(o) No representation or warranty contained in Section 2A of this Agreement
contains any untrue statement of a material fact or omits to state a material
fact necessary to make the statements herein not misleading in the context of
such representations and warranties. The Placement Agent shall be entitled to
rely on such representations and warranties.

 

(p) No consent, authorization or filing of or with any court or governmental
authority is required in connection with the issuance or the consummation of the
transactions contemplated herein or in the other Company Transaction Documents,
except for required filings with the SEC and the applicable state securities
commissions relating specifically to the Offering (all of which filings will be
duly made by, or on behalf of, the Company), and those which are required to be
made after the First Closing (all of which will be duly made on a timely basis).

 

(q) Intentionally omitted.

 

(r) Duane Morris LLP is counsel to an affiliate of EDI for the private placement
offering of the Units for which Duane Morris LLP will receive compensation for
its services to the affiliate. The Company acknowledges that affiliates of the
Placement Agent may own shares of the Company. Duane Morris LLP has been engaged
by Enumeral as its corporate and securities counsel in respect of the Merger,
and Duane Morris LLP may continue to be retained by Enumeral after the Merger to
serve as its corporate and securities counsel and in such case, will receive
legal fees in accordance with an executed retainer agreement.  

 

(s) Neither the sale of the Units by the Company nor its use of the proceeds
thereof will violate the Trading with the Enemy Act, as amended, nor do any of
the foreign assets control regulations of the United States Treasury Department
(31 CFR, Subtitle B, Chapter V, as amended) or any enabling legislation or
executive order relating thereto. Without limiting the foregoing, the Company is
not (a) a person whose property or interests in property are blocked pursuant to
Section 1 of Executive Order 13224 of September 23, 2001 Blocking Property and
Prohibiting Transactions with Persons Who Commit, Threaten to Commit, or Support
Terrorism (66 Fed. Reg. 49079 (2001)) or (b) a person who engages in any
dealings or transactions, or be otherwise associated, with any such person. The
Company and its subsidiaries, if any, are in compliance, in all material
respects, with the USA Patriot Act of 2001 (signed into law October 26, 2001).

 

8

 

 

(t) None of Company, any of its predecessors, any affiliated issuer, any
director, executive officer, other officer of the Company participating in the
Offering, any beneficial owner of 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 Securities Act)
connected with the Company in any capacity at the time of sale (each, an “Issuer
Covered Person” and, together, “Issuer Covered Persons”) is subject to any
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 Covered Person is subject to a Disqualification Event. The Company
has complied, to the extent applicable, with its disclosure obligations under
Rule 506(e), and has furnished to the Placement Agent a copy of any disclosures
provided thereunder.

 

(u) The Company is not aware of any person (other than any Issuer Covered Person
or Placement Agent Covered Person (as defined below) that has been or will be
paid (directly or indirectly) remuneration for solicitation of purchasers in
connection with the sale of any the Securities.

 

(v) The Company will promptly notify the Placement Agent in writing of (A) any
Disqualification Event relating to any Issuer Covered Person and (B) any event
that would, with the passage of time, become a Disqualification Event relating
to any Issuer Covered Person.

 

2B.           Representations, Warranties and Covenants of Placement Agent. The
Placement Agent hereby represents and warrants to the Company that the following
representations and warranties are true and correct as of the date of this
Agreement:

 

(a) The Placement Agent is a corporation duly organized, validly existing and in
good standing under the laws of the jurisdiction in which it was formed and has
all requisite corporate power and authority to enter into this Agreement and to
carry out and perform its obligations under the terms of this Agreement.

 

(b) This Agreement has been duly authorized, executed and delivered by the
Placement Agent, and upon due execution and delivery by the Company, this
Agreement will be a valid and binding agreement of the Placement Agent
enforceable against it in accordance with its terms, except as may be limited by
principles of public policy and, as to enforceability, subject to applicable
bankruptcy, insolvency, reorganization, moratorium and similar laws relating to
or affecting creditor’s rights from time to time in effect and subject to
general equity principles.

 

(c) The Placement Agent, and to its knowledge, each Sub-Agent, is a member of
FINRA in good standing and is registered as a broker-dealer under the Exchange
Act (as defined below), and under the securities acts of each state into which
it is making offers or sales of the Units. None of the Placement Agent or its
affiliates, or any person acting on behalf of the foregoing, including the
Sub-Agents (other than the Company, its or their affiliates or any person acting
on its or their behalf, in respect of which no representation is made) has taken
nor will it take any action that conflicts with the conditions and requirements
of, or that would make unavailable with respect to the Offering, the
exemption(s) from registration available pursuant to Rule 506 of Regulation D or
Section 4(a)(2) of the Act, or knows of any reason why any such exemption would
be otherwise unavailable to it. The Placement Agent will conduct the Offering in
compliance with all applicable securities laws.

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(d) The Placement Agent agrees that it has not and will not directly or
indirectly solicit offers for, or offer to sell, Units (i) by means of general
solicitation or advertising (as those terms are used in Regulation D) or in any
manner involving a public offering within the meaning of Section 4(a) of the
Securities Act and (ii) to any entities, including their affiliates, that are,
to the reasonable knowledge of the Placement Agent, engaged in the
pharmaceutical, life-science related, biotechnology, healthcare or medical
device business without the prior written consent of the Company.

 

(e) To the knowledge of the Placement Agent, (i) there are no actions, suits,
claims, hearings or proceedings pending before any court or governmental
authority or threatened, against the Placement Agent, or any Sub-Agent and (ii)
neither the Placement Agent nor any Sub-Agent is in violation of any judgment,
decree or order of any court or governmental body having jurisdiction over the
Placement Agent nor any Sub-Agent Company.

 

(f) Intentionally omitted.

 

(g) The Placement Agent represents that neither it, nor to its knowledge any of
the Sub-Agents or any of its or their respective directors, executive officers,
general partners, managing members or other officers participating in the
Offering (each, a “Placement Agent Covered Person” and, together, “Placement
Agent Covered Persons”), is subject to any of the “Bad Actor” disqualifications
described in Rule 506(d)(1)(i) to (viii) under the Securities Act (a
“Disqualification Event”).

 

(h) The Placement Agent represents that it is not aware of any person (other
than any Issuer Covered Person or Placement Agent Covered Person) that has been
or will be paid (directly or indirectly) remuneration for solicitation of
purchasers in connection with the sale of the Units. Placement Agent will
promptly notify the Company of any agreement entered into between such Placement
Agent and such person in connection with such sale.

 

(i) The Placement Agent will notify the Company promptly in writing of (A) any
Disqualification Event relating to any Placement Agent Covered Person not
previously disclosed to the Company in accordance with Section 3(b)(i), No
Disqualification Events and (B) any event that would, with the passage of time,
become a Disqualification Event relating to any Placement Agent Covered Person.

 

3.          Placement Agent Compensation.

 

(a) In connection with the Offering, the Company will pay a cash fee (the
“Brokers’ Cash Fee”) to the Placement Agent at each Closing, and as a condition
to Closing, equal to Ten Percent (10%) of the gross sales price of the Units
purchased by those investor(s) directly introduced to the Company by the
Placement Agent (“EDI Investors”). In addition, the Company will deliver to the
Placement Agent (or its designees) warrants exercisable for a period of five (5)
years from the Closing Date, to purchase a number of shares of Common Stock
equal to Ten Percent (10%) of the number of shares of Common Stock sold to the
EDI Investors with an exercise price of $1.00 per (“Broker Warrants”) (“Brokers’
Cash Fee” and “Broker Warrants” are sometimes referred to collectively as
“Brokers’ Fees”). The Broker Warrants shall be included in the registration
statement (on Form S-1, or similar form) with the SEC covering the shares of
Common Stock issuable upon the exercise of the Investor Warrants (“Registration
Statement”).

 

10

 

 

(b)          The Company shall also pay to the Placement Agent a cash fee
(“Subsequent Offering Fee”) on the amount that any person or entity contacted by
the Placement Agent in connection with the Offering (each, an “EDI Introduced
Investor”), invests in the Company at any time prior to the date that is
eighteen (18) months after the Termination Date or the Final Closing, whichever
is applicable, whether or not such EDI Introduced Investor invested in the
Offering, provided, that such person was introduced to the Company by the
Placement Agent prior to or during the Offering and was provided with a copy of
the Private Placement Memorandum; and provided, further, that an EDI Introduced
Investor shall not include (x) any investors who were investors in Enumeral
prior to the Offering, (y) any employees, directors or officers of Enumeral, or
(z) were introduced to the Company by employees, officers or directors of
Enumeral (and who were not a client of the Placement Agent prior to the
Offering), whether or not they participate in the placement. The Subsequent
Offering Fee shall be equal to (i) the highest percentage of amount raised paid
to any placement agent affiliated with the offering, or (ii) 10 percent if no
placement agents are engaged as part of such offering.

 

(c) To the extent there is more than one Closing, payment of the proportional
amount of the Brokers’ Fees will be made out of the proceeds of subscriptions
for the Units sold at each Closing.

 

4.          Subscription and Closing Procedures.

 

(a) The Company shall cause to be delivered to the Placement Agent copies of the
Subscription Documents and has consented, and hereby consents, to the use of
such copies for the purposes permitted by the Act and applicable securities laws
and in accordance with the terms and conditions of this Agreement, and hereby
authorizes the Placement Agent and its agents and employees to use the
Subscription Documents in connection with the sale of the Units until the
earlier of (i) the Termination Date or (ii) the Final Closing, and no person or
entity is or will be authorized to give any information or make any
representations other than those contained in the Subscription Documents or to
use any offering materials other than those contained in the Subscription
Documents in connection with the sale of the Units, unless the Company first
provides the Placement Agent with notification of such information,
representations or offering materials.

 

(b) The Company shall make available to the Placement Agent, any Sub-Agent and
their respective representatives such information, including, but not limited
to, financial information, and other information regarding the Company (the
“Information”), as may be reasonably requested in making a reasonable
investigation of the Company and its affairs. The Company shall provide access
to the officers, directors, employees, independent accountants, legal counsel
and other advisors and consultants of the Company as shall be reasonably
requested by the Placement Agent. The Company recognizes and agrees that the
Placement Agent and a Sub-Agent (i) will use and rely primarily on the
Information and generally available information from recognized public sources
in performing the services contemplated by this Agreement without independently
verifying the Information or such other information, (ii) does not assume
responsibility for the accuracy of the Information or such other information,
and (iii) will not make an appraisal of any assets or liabilities owned or
controlled by the Company or its market competitors.

11

 

 

(c) Each prospective purchaser will be required to complete and execute the
Subscription Documents, Anti-Money Laundering Form and other documents (the
“Subscription Documents”) which will be forwarded or delivered to the Placement
Agent at the Placement Agent’s offices at the address set forth in Section 12
hereof.

 

(d) Simultaneously with the delivery to the Placement Agent of the Subscription
Documents, the subscriber’s check or other good funds will be forwarded directly
by the subscriber to the escrow agent and deposited into a separate non interest
bearing escrow account (the “Escrow Account”) established for such purpose (the
“Escrow Agent”). All such funds for subscriptions will be held in the Escrow
Account pursuant to the terms of an escrow agreement among the Company, the
Placement Agent and the Escrow Agent. The Company will pay all fees related to
the establishment and maintenance of this Escrow Account. Subject to the receipt
of subscriptions for the Minimum Amount for the First Closing, the Company will
either accept or reject, for any or no reason, the Subscription Documents in a
timely fashion and at each Closing will countersign the Subscription Documents
and provide duplicate copies of such documents to the Placement Agent for
distribution to the subscribers. The acceptance of any Subscription Documents
will be subject to the reasonable approval of the Company. The Company will give
notice to the Placement Agent of its acceptance of each subscription. The
Company, or the Placement Agent on the Company’s behalf, will promptly return to
subscribers incomplete, improperly completed, improperly executed and rejected
subscriptions and give written notice thereof to the Placement Agent upon such
return.

 

(e) If subscriptions for at least the Minimum Amount have been accepted by the
Company prior to the Termination Date, the funds therefor have been collected by
the Escrow Agent and all of the conditions set forth elsewhere in this Agreement
are fulfilled, a closing shall be held promptly with respect to the Units sold
(the “First Closing”). Thereafter, the remaining Units will continue to be
offered and sold until the Termination Date. Additional closings (“Closings”)
may from time to time be conducted at times mutually agreed to between the
Placement Agent and the Company with respect to additional Units sold, with the
final closing (“Final Closing”) to occur within 10 days after the earlier of the
Termination Date and the date on which the Maximum Amount (including any
over-allotment) has been subscribed for. Delivery of payment for the accepted
subscriptions for Units from the funds held in the Escrow Account will be made
at each Closing at the Placement Agent’s offices against delivery of the Units
by the Company at the address set forth in Section 12 hereof (or at such other
place as may be mutually agreed upon between the Company and the Placement
Agent), net of amounts due to the Placement Agent and the Blue Sky counsel as of
such Closing. Executed certificates for the Units will be in such authorized
denominations and registered in such names as the Placement Agent may request on
or before the date of each Closing (“Closing Date”). The certificates will be
forwarded to the subscriber directly by the transfer agent or the Company’s
designated agent at each Closing. The Company will issue the certificates for
the Units within twenty (20) days of each Closing.

 

12

 

 

(f) If Subscription Documents for the Minimum Amount have not been received and
accepted by the Company on or before the Termination Date for any reason, the
Offering will be terminated, no Units will be sold, and the Escrow Agent will,
at the request of the Placement Agent, cause all monies received from
subscribers for the Units to be promptly returned to such subscribers without
interest, penalty, expense or deduction.

 

5.          Further Covenants.

 

The Company hereby covenants and agrees that:

 

(a) Except upon prior written notice to the Placement Agent, the Company shall
not, at any time prior to the Final Closing, knowingly take any action which
would cause any of the representations and warranties made by it in this
Agreement not to be complete and correct in all material respects on and as of
each Closing Date with the same force and effect as if such representations and
warranties had been made on and as of each such date (except to the extent any
representation or warranty relates to an earlier date).

 

(b) If, at any time prior to the Final Closing, any event shall occur that
causes a Company Material Adverse Effect which as a result it becomes necessary
to amend or supplement the Subscription Documents so that the representations
and warranties herein remain true and correct in all material respects, or in
case it shall be necessary to amend or supplement the Subscription Documents to
comply with Regulation D or any other applicable securities laws or regulations,
the Company will promptly notify the Placement Agent and shall, at its sole
cost, prepare and furnish to the Placement Agent copies of appropriate
amendments and/or supplements in such quantities as the Placement Agent may
reasonably request. The Company will not at any time before the Final Closing
prepare or use any amendment or supplement to the Subscription Documents of
which the Placement Agent will not previously have been advised and furnished
with a copy, or which is not in compliance in all material respects with the Act
and other applicable securities laws. As soon as the Company is advised thereof,
the Company will advise the Placement Agent and its counsel, and confirm the
advice in writing, of any order preventing or suspending the use of the
Subscription Documents, or the suspension of any exemption for such
qualification or registration thereof for offering in any jurisdiction, or of
the institution or threatened institution of any proceedings for any of such
purposes, and the Company will use its commercially reasonable efforts to
prevent the issuance of any such order and, if issued, to obtain as soon as
reasonably possible the lifting thereof.

 

(c) The Company shall comply with the Act, the Securities Exchange Act of 1934,
as amended (the “Exchange Act”), and the rules and regulations thereunder, all
applicable state securities laws and the rules and regulations thereunder in the
states in which the Company’s Blue Sky counsel has advised the Placement Agent
and/or the Company that the Units are qualified or registered for sale or exempt
from such qualification or registration, so as to permit the continuance of the
sales of the Units, and will file or cause to be filed with the SEC, and shall
promptly thereafter forward or cause to be forwarded to the Placement Agent, any
and all reports on Form D as are required. The Company will pay the legal fees
of its counsel, blue sky filing fees and out of pocket expenses (“Registration
Legal Fees”) related to the filings for registrations of sale or exemption from
such qualifications with any state securities commissions and any other
regulatory agencies. Except as otherwise set forth in the Registration Rights
Agreement, the Placement Agent and any investors in the Offering shall pay the
legal fees of their counsel. An accounting of such Registration Legal Fees will
be provided to the Company. Such fees shall be paid at the time of a Closing, if
known, and if not yet invoiced, funds will remain in escrow to cover the
estimated invoice or deposited into the attorney’s escrow account responsible
for the Registration Legal Fees.

 

13

 

 

(d) The Company shall use commercially reasonable efforts to qualify the Units
for sale under the securities laws of such jurisdictions in the United States as
may be mutually agreed to by the Company and the Placement Agent, and the
Company will make or cause to be made such applications and furnish information
as may be required for such purposes, provided that the Company will not be
required to qualify as a foreign corporation in any jurisdiction or execute a
general consent to service of process. The Company will, from time to time,
prepare and file such statements and reports as are or may be required to
continue such qualifications in effect for so long a period as the Placement
Agent may reasonably request with respect to the Offering.

 

(e) The Company shall place a legend on the certificates representing the Units,
the Common Stock and the Investor Warrants that the securities evidenced thereby
have not been registered under the Act or applicable state securities laws,
setting forth or referring to the applicable restrictions on transferability and
sale of such securities under the Act and applicable state laws.

 

(f) The Company shall apply the net proceeds from the sale of the Units for the
purposes substantially as described in the Subscription Documents. Except as set
forth in the Subscription Documents, the Company shall not use any of the net
proceeds of the Offering to repay indebtedness to officers (other than accrued
salaries incurred in the ordinary course of business), directors or stockholders
of the Company without the prior written consent of the Placement Agent.

 

(g) During the Offering Period, the Company shall afford each prospective
purchaser of the Units the opportunity to ask questions of and receive answers
from an officer of the Company concerning the terms and conditions of the
Offering and the opportunity to obtain such other additional information
necessary to verify the accuracy of the Subscription Documents to the extent the
Company possesses such information or can acquire it without unreasonable
expense.

 

(h) Except with the prior written consent of the Placement Agent, the Company
shall not, at any time prior to the earlier of the Final Closing or the
Termination Date, except as contemplated by the Merger and the Subscription
Documents (i) engage in or commit to engage in any transaction outside the
ordinary course of business as described in the Subscription Documents, (ii)
issue, agree to issue or set aside for issuance any securities (debt or equity)
or any rights to acquire any such securities (other than options under the
Company’s equity incentive plan), (iii) incur, outside the ordinary course of
business, any material indebtedness , (iv) dispose of any material assets, (v)
make any material acquisition or (vi) change its business or operations in any
material respect.

 

14

 

 

(i) The Company shall pay all reasonable expenses incurred in connection with
the preparation and printing of all necessary offering documents and instruments
related to the Offering and the issuance of the Units and will also pay for the
Company’s expenses for accounting fees, legal fees, printing reasonable and
customary costs, and other reasonable and customary costs involved with the
Offering. The Company will provide at its own expense such quantities of the
Subscription Documents and other documents and instruments relating to the
Offering as the Placement Agent may reasonably request. The Company will pay at
its own expense in connection with the creation, authorization, issuance,
transfer and delivery of the Units, including, without limitation, fees and
expenses of any transfer agent or registrar; the fees and expenses of the Escrow
Agent; all fees and expenses of legal, accounting and other advisers to the
Company; the Registration Legal Fees related to the registration or
qualification of the Units for offer and sale under the securities or Blue Sky
laws of such jurisdictions, payable within five (5) days of being invoiced; at
the First Closing, the reasonable legal fees and reasonable and customary
expenses of the Placement Agent’s counsels (the “Placement Agent’s Counsel
Fee”), which legal fees shall not exceed Thirty Thousand Dollars ($30,000) in
the aggregate plus expenses, provided that such limitation shall in no way
effect the obligations of the Company with respect to indemnification and
contribution as set forth in Sections 8 and 9 herein. The Placement Agent
Counsel Fee does not include the Registration Legal Fees and expenses for the
Blue Sky and other regulatory filings required to be made for the Offering. At
the first Closing, the Company also shall pay EDI the following fees: (x) not
more than $2,000 to reimburse expenses incident to hosting a WebEX on behalf of
the Company upon proof of vendor expense; and (y) not more than $2,000 and other
direct expenses to reimburse the reasonable and customary costs of maintaining
an escrow account for this Offering.

 

6.          Conditions of Placement Agent’s Obligations.

 

The obligations of the Placement Agent hereunder to affect a Closing are subject
to the fulfillment, at or before each Closing, of the following additional
conditions:

 

(a) Each of the representations and warranties made by the Company herein (when
read without regard to any qualification as to materiality or Material Adverse
Effect contained therein) shall be true and correct on each Closing Date, except
to the extent any such representation or warranty expressly speaks as of an
earlier date, in which case such representation or warranty shall be true and
correct as of such earlier date except for any untrue or incorrect
representation and warranty that, individually or in the aggregate, does not
have a Company Material Adverse Effect.

 

(b) The Company shall have performed and complied in all material respects with
all agreements, covenants and conditions required to be performed hereunder, and
complied with by it at or before the Closing.

 

(c) The Subscription Documents do not, and as of the date of any amendment or
supplement thereto will not, include any untrue statement of a material fact
relating to the Company or omit to state any material fact relating to the
Company necessary in order to make the statements therein, in light of the
circumstances under which they were made, not misleading.

 

15

 

 

(d) No order suspending the use of the Subscription Documents or enjoining the
Offering or sale of the Units shall have been issued, and no proceedings for
that purpose or a similar purpose shall have been initiated or pending, or, to
the best of the Company’s knowledge, be contemplated or threatened.

 

(e) The Placement Agent shall have received a certificate of the Chief Executive
Officer of the Company, dated as of the Closing Date, certifying, as to the
fulfillment of the conditions set forth in subparagraphs (a), (b), (c) and (d)
above.

 

(f) The Company shall have delivered to the Placement Agent: (i) a good standing
certificate dated as of a date within 10 days prior to the Closing Date from the
secretary of state of its jurisdiction of incorporation and (ii) resolutions of
the Company’s Board of Directors approving this Agreement and the transactions
and agreements contemplated by this Agreement, and the Subscription Documents,
all as certified by the Chief Executive Officer of the Company.

 

(g) At each Closing, the Company shall pay and/or issue to the Placement Agent
the Brokers’ Fees earned in such Closing.

 

(h) All proceedings taken at or prior to the Closing in connection with the
authorization, issuance and sale of the Units will be reasonably satisfactory in
form and substance to the Placement Agent and its counsel, and such counsel
shall have been furnished with all such documents, certificates and opinions as
it may reasonably request upon reasonable prior notice in connection with the
transactions contemplated hereby.

 

7.          Conditions of the Company’s Obligations.

 

The obligations of the Company hereunder are subject to the satisfaction of each
of the following conditions:

 

(a) The satisfaction or waiver of all conditions to closing as set forth herein.

 

(b) As of each Closing, each of the representations and warranties made by
Placement Agent herein being true and correct as of the Closing Date for such
Closing.

 

(c) At each Closing, the Company shall have received the proceeds from the sale
of the Units that are part of such Closing less applicable Brokers’ Fees.

 

7A. Mutual Condition. The obligations of the Placement Agent and the Company
hereunder are subject to the execution by each investor of a Subscription
Agreement in form and substance acceptable to the Placement Agent and the
Company and deposit by such investor with the escrow agent of all funds required
to be so deposited by such investor.

 

16

 

 

8.          Indemnification.

 

(a) The Company will: (i) indemnify and hold harmless the Placement Agent, its
agents and their respective officers, directors, employees, selected dealers and
each person, if any, who controls the Placement Agent within the meaning of the
Act and such agents (each an “Indemnitee” or a “Placement Agent Party”) against,
and pay or reimburse each Indemnitee for, any and all losses, claims, damages,
liabilities or expenses whatsoever (or actions or proceedings or investigations
in respect thereof), severally (which will, for all purposes of this Agreement,
include, but not be limited to, all reasonable and customary costs of defense
and investigation and all reasonable attorneys’ fees, including appeals), to
which any Indemnitee may become subject (a) under the Act or otherwise, in
connection with the offer and sale of the Units and (b) as a result of the
breach of any representation, warranty or covenant made by the Company herein,
regardless of whether such losses, claims, damages, liabilities or expenses
shall result from any claim by any Indemnitee or by any third party; and (ii)
reimburse each Indemnitee for any legal or other expenses reasonably incurred in
connection with investigating or defending against any such loss, claim, action,
proceeding or investigation; provided, however, the Company will not be liable
in any such case to the extent that any such claim, damage or liability is
finally judicially determined to have resulted from (A) an untrue statement or
alleged untrue statement of a material fact made in the Subscription Documents,
or an omission or alleged omission to state therein a material fact required to
be stated therein or necessary to make the statements therein not misleading,
made solely in reliance upon and in conformity with written information
furnished to the Company by the Placement Agent specifically for use in the
Subscription Documents or (B) any violations by the Placement Agent of the Act
or state securities laws which does not result from a violation thereof by the
Company or any of their respective affiliates or (C) due to the intentional or
negligent misrepresentation and / or malfeasance or willful misconduct of the
Placement Agent Parties. In addition to the foregoing agreement to indemnify and
reimburse, the Company will indemnify and hold harmless each Indemnitee against
any and all losses, claims, damages, liabilities or expenses whatsoever (or
actions or proceedings or investigations in respect thereof), joint or several
(which shall, for all purposes of this Agreement, include, but not be limited
to, all reasonable and customary costs of defense and investigation and all
reasonable attorneys’ fees, including appeals) to which any Indemnitee may
become subject insofar as such costs, expenses, losses, claims, damages or
liabilities arise out of or are based upon the claim of any person or entity
that he or it is entitled to broker’s or finder’s fees from any Indemnitee in
connection with the Offering as a result of the Company obligating itself or any
Indemnitee to pay such a fee, other than fees due to the Placement Agent, its
dealers, sub-agents or finders. The foregoing indemnity agreements will be in
addition to any liability the Company may otherwise have.

 

17

 

 

(b) The Placement Agent will indemnify and hold harmless the Company, its
subsidiaries, and their respective officers, directors, and each person, if any,
who controls such entity within the meaning of the Act (collectively, the
“Company Indemnitees”) against, and pay or reimburse any such person for, any
and all losses, claims, damages, liabilities or expenses whatsoever (or actions,
proceedings or investigations in respect thereof) to which the Company or any
such person may become subject under the Act or otherwise, whether such losses,
claims, damages, liabilities or expenses shall result from any claim of the
Company or any such person who controls the Company within the meaning of the
Act or by any third party, but only to the extent that such losses, claims,
damages or liabilities are based upon any violations by the Placement Agent of
the Act or state securities laws which does not result from a violation thereof
by the Company or any of their respective affiliates, any untrue statement or
alleged untrue statement of any material fact contained in the Subscription
Documents made in reliance upon and in conformity with information contained in
the Subscription Documents relating to the Placement Agent, or an omission or
alleged omission to state therein a material fact required to be stated therein
or necessary to make the statements therein not misleading, in either case, if
made or omitted in reliance upon and in conformity with written information
furnished to the Company by the Placement Agent, specifically for use in the
preparation thereof or due to the intentional or negligent misrepresentation and
/ or malfeasance or willful misconduct of the Placement Agent or any of the
other Placement Agent Parties. The Placement Agent will reimburse the Company or
any such person for any legal or other expenses reasonably incurred in
connection with investigating or defending against any such loss, claim, damage,
liability or action, proceeding or investigation to which such indemnity
obligation applies. In addition to the foregoing agreement to indemnify and
reimburse, the Placement Agent will indemnify and hold harmless each Company
Indemnitee against any and all losses, claims, damages, liabilities or expenses
whatsoever (or actions or proceedings or investigations in respect thereof),
joint or several (which shall, for all purposes of this Agreement, include, but
not be limited to, all reasonable and customary costs of defense and
investigation and all reasonable attorneys’ fees, including appeals) to which
any Company Indemnitee may become subject insofar as such costs, expenses,
losses, claims, damages or liabilities arise out of or are based upon the claim
of any person or entity that he or it is entitled to broker’s or finder’s fees
from any Company Indemnitee in connection with the Offering as a result of the
Placement Agent obligating itself or any Company Indemnitee to pay such a fee.
The foregoing indemnity agreements are in addition to any liability which the
Placement Agent may otherwise have.

 

(c) Promptly after receipt by an indemnified party under this Section 8 of
notice of the commencement of any action, claim, proceeding or investigation
(the “Action”), such indemnified party, if a claim in respect thereof is to be
made against the indemnifying party under this Section 8, will notify the
indemnifying party of the commencement thereof, but the omission to so notify
the indemnifying party will not relieve it from any liability that it may have
to any indemnified party under this Section 8 unless the indemnifying party has
been substantially prejudiced by such omission. The indemnifying party will be
entitled to participate in and, to the extent that it may wish, jointly with any
other indemnifying party, to assume the defense thereof subject to the
provisions herein stated, with counsel reasonably satisfactory to such
indemnified party. The indemnified party will have the right to employ separate
counsel in any such Action and to participate in the defense thereof, but the
fees and expenses of such counsel will not be at the expense of the indemnifying
party if the indemnifying party has assumed the defense of the Action with
counsel reasonably satisfactory to the indemnified party, provided, however,
that if the indemnified party shall be requested by the indemnifying party to
participate in the defense thereof or shall have concluded in good faith and
specifically notified the indemnifying party either that there may be specific
defenses available to it that are different from or additional to those
available to the indemnifying party or that such Action involves or could have a
material adverse effect upon it with respect to matters beyond the scope of the
indemnity agreements contained in this Agreement, then the counsel representing
it, to the extent made necessary by such defenses, shall have the right to
direct such defenses of such Action on its behalf and in such case the
reasonable fees and expenses of one such counsel in connection with any such
participation or defenses shall be paid by the indemnifying party. No settlement
of any Action against an indemnified party will be made without the consent of
the indemnifying party and the indemnified party, which consent shall not be
unreasonably withheld or delayed in light of all factors of importance to such
party, and no indemnifying party shall be liable to indemnify any person for any
settlement of any such claim effected without such indemnifying party’s consent.

 

18

 

 

9.          Contribution.

 

To provide for just and equitable contribution, if: (i) an indemnified party
makes a claim for indemnification pursuant to Section 8 hereof and it is finally
determined, by a judgment, order or decree not subject to further appeal that
such claims for indemnification may not be enforced, even though this Agreement
expressly provides for indemnification in such case; or (ii) any indemnified or
indemnifying party seeks contribution under the Act, the Exchange Act, or
otherwise, then each indemnifying party shall contribute to such amount paid or
payable by such indemnified party in such proportion as is appropriate to
reflect not only such relative benefits but also the relative fault of the
Company on the one hand and the Placement Agent on the other in connection with
the statements or omissions which resulted in such losses, claims, damages,
liabilities or expenses (or actions in respect thereof), as well as any other
relevant equitable considerations. The relative benefits received by the Company
on the one hand and the Placement Agent on the other shall be deemed to be in
the same proportion as the total net proceeds from the Offering (before
deducting expenses) received by the Company bear to the total Brokers’ Fees
received by the Placement Agent. The relative fault, in the case of an untrue
statement, alleged untrue statement, omission or alleged omission will be
determined by, among other things, whether such statement, alleged statement,
omission or alleged omission relates to information supplied by the Company or
by the Placement Agent, and the parties’ relative intent, knowledge, access to
information and opportunity to correct or prevent such statement, alleged
statement, omission or alleged omission. The Company and the Placement Agent
agree that it would be unjust and inequitable if the respective obligations of
the Company and the Placement Agent for contribution were determined by pro rata
allocation of the aggregate losses, liabilities, claims, damages and expenses or
by any other method or allocation that does not reflect the equitable
considerations referred to in this Section 9. No person guilty of a fraudulent
misrepresentation (within the meaning of Section 10(f) of the Act) will be
entitled to contribution from any person who is not guilty of such fraudulent
misrepresentation. For purposes of this Section 9, each person, if any, who
controls the Placement Agent within the meaning of the Act will have the same
rights to contribution as the Placement Agent, and each person, if any, who
controls the Company within the meaning of the Act will have the same rights to
contribution as the Company, subject in each case to the provisions of this
Section 9. Anything in this Section 9 to the contrary notwithstanding, no party
will be liable for contribution with respect to the settlement of any claim or
action effected without its written consent. This Section 9 is intended to
supersede, to the extent permitted by law, any right to contribution under the
Act, the Exchange Act or otherwise available.

 

19

 

 

10.         Termination.

 

(a) The Offering may be terminated by the Placement Agent at any time prior to
the expiration of the Offering Period in the event that: (i) any of the
representations, warranties or covenants of the Company contained herein or in
the Subscription Documents shall prove to have been false or misleading in any
material respect when actually made; (ii) the Company shall have failed to
perform any of its material obligations hereunder or under any other Company
Transaction Document or any other transaction document; (iii) there shall occur
any event, within the control of the Company that is reasonably likely to
materially and adversely affect the transactions contemplated hereunder or the
ability of the Company to perform hereunder; or (iv) the Placement Agent
determines that it is reasonably likely that any of the conditions to Closing to
be fulfilled by the Company set forth herein will not, or cannot, be satisfied.

 

(b) The Offering may be terminated by the Company at any time prior to the
expiration of the Offering Period (i) in the event that the Placement Agent
shall have failed to perform any of its material obligations hereunder, or (ii)
on account of the Placement Agent’s fraud, illegal or willful misconduct or
gross negligence or (iii) a material breach of this Agreement by the Placement
Agent. In the event of any such termination by the Company, the Placement Agent
shall not be entitled to any amounts whatsoever except (i) as may be due under
any indemnity or contribution obligation provided herein or in any other Company
Transaction Document, at law or otherwise and (ii) it shall retain any Brokers’
Fees received for Closings that occurred prior to the Termination Date.

 

(c) This Offering may be terminated upon mutual agreement of the Company and the
Placement Agent at any time prior to the expiration of the Offering Period.

 

(d) Before any termination by the Placement Agent under Section 10(a) or by the
Company under Section 10(b) shall become effective, the terminating party shall
give five (5) days prior written notice to the other party of its intention to
terminate the Offering (the “Termination Notice”). The Termination Notice shall
specify the grounds for the proposed termination. If the specified grounds for
termination, or their resulting adverse effect on the transactions contemplated
hereby, are curable, then the other party shall have three (3) days from the
Termination Notice within which to remove such grounds or to eliminate all of
their material adverse effects on the transactions contemplated hereby;
otherwise, the Offering shall terminate.

 

(e) Upon any termination pursuant to this Section 10, the Placement Agent and
the Company will instruct the Escrow Agent to cause all monies received with
respect to the subscriptions for the Units not accepted by the Company to be
promptly returned to such subscribers without interest, penalty or deduction.

 

11.         Survival.

 

(a) The obligations of the parties to pay any costs and expenses hereunder and
to provide indemnification and contribution as provided herein shall survive any
termination hereunder. In addition, the provisions of Sections 3, 8 through 17
shall survive the sale of the Units or any termination of the Offering
hereunder.

 

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(b) The respective indemnities, covenants, representations, warranties and other
statements of the Company and the Placement Agent set forth in or made pursuant
to this Agreement will remain in full force and effect, regardless of any
investigation made by or on behalf of, and regardless of any access to
information by the Company or the Placement Agent, or any of their officers or
directors or any controlling person thereof, and will survive the sale of the
Units or any termination of the Offering hereunder. Notwithstanding the
foregoing, if either party effects a Closing with knowledge that one or more of
the other party’s representations and warranties has become untrue or inaccurate
in any material respect or that such other party has failed to comply or satisfy
in any material respect a covenant, condition or agreement of it or them, the
party so effecting the Closing shall be deemed to have waived any claim based on
the breach of such inaccurate representation and warranty or the failure to have
complied with the specific covenant or condition.

 

12.         Notices.

 

All notices, consents, waivers, and other communications which are required or
permitted under this Agreement shall be in writing will be deemed given to a
party (a) on the date of delivery, if delivered to the appropriate address by
hand or by nationally recognized overnight courier service (costs prepaid); (b)
the date of transmission if sent by facsimile or e-mail with confirmation of
transmission by the transmitting equipment if such notice or communication is
delivered prior to 5:00 P.M., New York City time, on a business day, or the next
business day after the date of transmission, if such notice or communication is
delivered on a day that is not a business day or later than 5:00 P.M., New York
City time, on any business day; (c) the date received or rejected by the
addressee, if sent by certified mail, return receipt requested; or (d) seven
days after the placement of the notice into the mails (first class postage
prepaid), to the party at the address, facsimile number, or e-mail address
furnished by the such party,

 

If to the   EDI Financial, Inc. Placement Agent:   1431 Greenway Drive, Suite
330       Irving, TX  75038     Attention: Mr. Martin W. Prinz     President &
CEO,     Facsimile number 214-528-4052             If to the Company:   Cerulean
Group, Inc.       2360 Corporate Circle, Suite 400     Henderson, NV  89074-7722
    Attn: Olesya Didenko     President           and           Enumeral
Biomedical Corp.     One Kendall Square,     Building 400, 4th Floor    
Cambridge, MA 02139     Attn:  Arthur H. Tinkelenberg, Ph.D.

 

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with a copy to:   Crone Kline Rinde LLP     488 Madison Avenue, 12th Floor    
New York, NY 10022     Attn:  Barrett S. DiPaolo, Esq.       Facsimile number:
212-400-6930           and           Duane Morris, LLP     100 High Street,
Suite 2400     Boston, MA 02110-1724     Attention Jonathan Lourie, Esq.    
Facsimile number: 857-401-3089

 

Notices sent by certified mail shall be deemed received five days thereafter,
notices sent by hand delivery or overnight delivery shall be deemed received on
the date of the relevant written record of receipt.

 

13.         Governing Law, Jurisdiction.

 

This Agreement shall be deemed to have been made and delivered in New York City
and shall be governed as to validity, interpretation, construction, effect and
in all other respects by the internal laws of the State of New York applicable
to contracts to be wholly performed in said state.

 

THE PARTIES HERETO AGREE TO SUBMIT ALL CONTROVERSIES TO the exclusive
jurisdiction of finra ARBITRATION IN ACCORDANCE WITH THE PROVISIONS SET FORTH
BELOW AND UNDERSTAND THAT (A) ARBITRATION IS FINAL AND BINDING ON THE PARTIES,
(B) THE PARTIES ARE WAIVING THEIR RIGHTS TO SEEK REMEDIES IN COURT, INCLUDING
THE RIGHT TO A JURY TRIAL, (C) PRE-ARBITRATION DISCOVERY IS GENERALLY MORE
LIMITED AND DIFFERENT FROM COURT PROCEEDINGS, (D) THE ARBITRATOR’S AWARD IS NOT
REQUIRED TO INCLUDE FACTUAL FINDINGS OR LEGAL REASONING AND ANY PARTY’S RIGHT TO
APPEAL OR TO SEEK MODIFICATION OF RULES BY ARBITRATORS IS STRICTLY LIMITED, (E)
THE PANEL OF FINRA ARBITRATORS WILL TYPICALLY INCLUDE A MINORITY OF ARBITRATORS
WHO WERE OR ARE AFFILIATED WITH THE SECURITIES INDUSTRY, AND (F) ALL
CONTROVERSIES WHICH MAY ARISE BETWEEN THE PARTIES CONCERNING THIS AGREEMENT
SHALL BE DETERMINED BY ARBITRATION PURSUANT TO THE RULES THEN PERTAINING TO
FINRA. ALL QUESTIONS CONCERNING THE CONSTRUCTION, VALIDITY, ENFORCEMENT AND
INTERPRETATION OF THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED AND ENFORCED
IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEw york. JUDGMENT ON ANY AWARD OF
ANY SUCH ARBITRATION MAY BE ENTERED IN THE SUPREME COURT OF THE STATE OF NEW
YORK OR IN ANY OTHER COURT HAVING JURISDICTION OVER THE PERSON OR PERSONS
AGAINST WHOM SUCH AWARD IS RENDERED. THE PARTIES AGREE THAT THE DETERMINATION OF
THE ARBITRATORS SHALL BE BINDING AND CONCLUSIVE UPON THEM. THE PREVAILING PARTY,
AS DETERMINED BY SUCH ARBITRATORS, IN A LEGAL PROCEEDING SHALL BE ENTITLED TO
COLLECT ANY COSTS, DISBURSEMENTS AND REASONABLE ATTORNEY’S FEES FROM THE OTHER
PARTY. PRIOR TO FILING AN ARBITRATION, THE PARTIES HEREBY AGREE THAT THEY WILL
ATTEMPT TO RESOLVE THEIR DIFFERENCES FIRST BY SUBMITTING THE MATTER FOR
RESOLUTION TO A MEDIATOR, ACCEPTABLE TO ALL PARTIES, AND WHOSE EXPENSES WILL BE
BORNE EQUALLY BY ALL PARTIES. THE MEDIATION WILL BE HELD IN THE COUNTY OF NEW
YORK, STATE OF NEW YORK, ON AN EXPEDITED BASIS. IF THE PARTIES CANNOT
SUCCESSFULLY RESOLVE THEIR DIFFERENCES THROUGH MEDIATION, THE MATTER WILL BE
RESOLVED BY ARBITRATION. THE ARBITRATION SHALL TAKE PLACE IN THE COUNTY OF NEW
YORK, THE STATE OF NEW YORK, ON AN EXPEDITED BASIS.

 

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14.         Miscellaneous.

 

A.           No provision of this Agreement may be changed or terminated except
by a writing signed by the party or parties to be charged therewith. Unless
expressly so provided, no party to this Agreement will be liable for the
performance of any other party’s obligations hereunder. Either party hereto may
waive compliance by the other with any of the terms, provisions and conditions
set forth herein; provided, however, that any such waiver shall be in writing
specifically setting forth those provisions waived thereby. No such waiver shall
be deemed to constitute or imply waiver of any other term, provision or
condition of this Agreement. Neither party may assign its rights or obligations
under this Agreement to any other person or entity without the prior written
consent of the other party. Notwithstanding the foregoing, the parties
specifically acknowledge and agree that any Sub-Agent may rely upon and shall be
a beneficiary of the Representations, Warranties and Covenants of the Company
set forth in Section 2A hereof.

 

B.           Each party shall, without payment of any additional consideration
by any other party, at any time on or after the date of any Closings, take such
further action and execute such other and further documents and instruments as
the other party may reasonably request in order to provide the other party with
the benefits of this Agreement.

 

C.           The Parties to this Agreement each hereby confirm that they will
cooperate with each other to the extent that it may become necessary to enter
into any revisions or amendments to this Agreement, in the future to conform to
any federal or state regulations as long as such revisions or amendments do not
materially alter the obligations or benefits of either party under this
Agreement.

 

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15.         Entire Agreement; Severability.

 

This Agreement together with any other agreement referred to herein supersedes
all prior understandings and written or oral agreements between the parties with
respect to the Offering and the subject matter hereof. If any portion of this
Agreement shall be held invalid or unenforceable, then so far as is reasonable
and possible (i) the remainder of this Agreement shall be considered valid and
enforceable and (ii) effect shall be given to the intent manifested by the
portion held invalid or unenforceable.

 

16.         Counterparts.

 

This Agreement may be executed in multiple counterparts, each of which may be
executed by less than all of the parties and shall be deemed to be an original
instrument which shall be enforceable against the parties actually executing
such counterparts and all of which together shall constitute one and the same
instrument. The exchange of copies of this Agreement and of signature pages by
facsimile transmission or in pdf format shall constitute effective execution and
delivery of this Agreement as to the parties and may be used in lieu of the
original Agreement for all purposes. Signatures of the parties transmitted by
facsimile or in pdf format shall be deemed to be their original signatures for
all purposes.

 

17.         Confidentiality.

 

(a)          The Placement Agent will maintain the confidentiality of the
Information and, unless and until such information shall have been made publicly
available by the Company or by others without breach of a confidentiality
agreement, shall disclose the Information only as authorized by the Company or
as required by law or by order of a governmental authority or court of competent
jurisdiction. In the event the Placement Agent is legally required to make
disclosure of any of the Information, the Placement Agent will give prompt
notice to the Company prior to such disclosure, to the extent the Placement
Agent can practically do so.

 

(b)          The foregoing paragraph shall not apply to information that:

 

(i)          at the time of disclosure by the Company, is or thereafter becomes,
generally available to the public or within the industries in which the Company
conducts business, other than as a result of a breach by the Placement Agent of
its obligations under this Agreement;

 

(ii)         prior to or at the time of disclosure by the Company, was already
in the possession of, the Placement Agent or any of its affiliates, or could
have been developed by them from information then lawfully in their possession,
by the application of other information or techniques in their possession,
generally available to the public; at the time of disclosure by the Company
thereafter, is obtained by the Placement Agent or any of its affiliates from a
third party who the Placement Agent reasonably believes to be in possession of
the information not in violation of any contractual, legal or fiduciary
obligation to the Company with respect to that information; or is independently
developed by the Placement Agent or its affiliates.

 

24

 

 

The exclusions set forth in sub-section (b) above shall not apply to pro forma
financial information of the Company, which pro forma Information shall in all
events be subject to sub-section (a) above.

 

(c)          Nothing in this Agreement shall be construed to limit the ability
of the Placement Agent or its affiliates to pursue, investigate, analyze, invest
in, or engage in investment banking, financial advisory or any other business
relationship with entities other than the Company, notwithstanding that such
entities may be engaged in a business which is similar to or competitive with
the business of the Company, and notwithstanding that such entities may have
actual or potential operations, products, services, plans, ideas, customers or
supplies similar or identical to the Company’s, or may have been identified by
the Company as potential merger or acquisition targets or potential candidates
for some other business combination, cooperation or relationship. The Company
expressly acknowledges and agrees that they do not claim any proprietary
interest in the identity of any other entity in its industry or otherwise, and
that the identity of any such entity is not confidential information.

 

[Signatures on following page.]

 

25

 

If the foregoing is in accordance with your understanding of the agreement
between the Company and the Placement Agent, kindly sign and return this
Agreement, whereupon it will become a binding agreement as provided herein,
between the Company and the Placement Agent in accordance with its terms.

 

  CERULEAN GROUP INC.         By:  /s/ Olesya Didenko      Olesya Didenko    
 2360 Corporate Circle      Suite 400      Henderson, NV.  89074-7722

 

Accepted and agreed to this   day of July, 2014:       EDI FINANCIAL INC.      
  By:  /s/ Martin W. Prinz      Martin W. Prinz      President & CEO  

 

 

 

 

AMENDMENT NO. 1 TO

 

PLACEMENT AGENCY AGREEMENT

 

THIS AMENDMENT, dated as of July 21, 2014 (this “Amendment”), between EDI
Financial, Inc. , a registered broker-dealer and member of the Financial
Industry Regulatory Authority (“FINRA”) (hereinafter referred to as the
“Placement Agent”) and Enumeral Biomedical Holdings, Inc., a publicly traded
corporation duly organized under the laws of the State of Delaware (the
“Company”)

 

WITNESSETH

 

WHEREAS, the parties hereto have heretofore entered into a Placement Agency
Agreement, dated July 3, 2014, ( the “Agreement”); and

 

WHEREAS, the Company and the Placement Agent wish to amend the Agreement on the
terms set forth herein.

 

NOW, THEREFORE, the parties hereto, in consideration of the mutual promises
herein contained and for other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, hereby agree to amend the Agreement
as follows:

 

1.          Definitions; References; Continuation of Agreement. Unless otherwise
specified herein, each term used herein that is defined in the Agreement shall
have the meaning assigned to such term in the Agreement. Each reference to
“hereof,” “hereto,” “hereunder,” “herein” and “hereby” and each other similar
reference, and each reference to “this Agreement” and each other similar
reference, contained in the Agreement shall from and after the date hereof refer
to the Agreement as amended hereby. Except as amended hereby, all terms and
provisions of the Agreement shall continue unmodified and remain in full force
and effect.

 

2.          Placement of Stock. In connection with the private placement of
Units, the Company may offer and sell Units through other placement agents (the
“Other PA Investors”) and/or directly to certain investors, to be mutually
agreed to by and between the Company and the Placement Agent (the “Direct
Investors”). In connection with the sale of the Units to the Other PA Investors,
the Company will pay to such other Placement Agent Brokers’ Fees in an amount as
mutually agreed to between the Company, such other placement agent and the
Placement Agent. In connection with the sale of the Units to the Direct
Investors, the Company will pay to the Placement Agent the Brokers’ Fees in an
amount as mutually agreed to between the Company and the Placement Agent,
provided, however, that in no event shall the total cash fee and the warrants
paid to the Placement Agent and any other party(ies) with respect to any
investment by a Other PA Investor and/or a Direct Investor exceed ten percent
(10%) of the gross proceeds from the sale of the Units to such Other PA
Investors and/or Direct Investors, as applicable, and, in the case of warrants,
ten percent (10%) of the number of shares of Common Stock sold to such Other PA
Investor and/or the Direct Investors, as applicable.

 

3.          Increase of Overallotment. The Over-allotment Option is hereby
increased from Five Million Dollars ($5,000,000) to Ten Million Dollars
($10,000,000) such that the Maximum Amount of the Offering including the
Over-allotment Option shall be Twenty-five Million Dollars ($25,000,000) and all
references as set forth in the Agreement to the Over-allotment Option shall
hereafter be Ten Million Dollars ($10,000,000). Notwithstanding anything to the
contrary herein, neither the Placement Agent nor any other placement agent shall
receive any Broker Warrants as compensation for any sales of Units that result
in gross cash proceeds paid to the Company in excess of Twenty Million
($20,000,000) in the aggregate

 

 

 

 

4.          Section 5(i). Section 5(i) regarding Placement Agent Counsel’s Fees
is hereby amended by deleting “Thirty Thousand Dollars ($30,000)” and
substituting “Fifteen Thousand Dollars ($15,000)” in its place.

 

5.          Counterparts. This Amendment may be executed in two or more
counterparts, all of which when taken together 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, it being understood that both
parties need not sign the same counterpart.  In the event that any signature is
delivered by facsimile transmission or by e-mail delivery of a “.pdf” format
data file, such signature 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 facsimile or “.pdf” signature page were an original
thereof.

 

6.          Governing Law. This Amendment shall be governed by and construed in
accordance with the laws of the State of New York.

 

(Signature page to follow)

 

2

 

 

IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly
executed on the date first above written.

 

  Very truly yours,       ENUMERAL BIOMEDICAL HOLDINGS, INC.         By: /s/
Olesya Didenko     Name: Olesya Didenko       EDI FINANCIAL, NC.         By: 
/s/ Martin W. Prinz     Name:  Martin W. Prinz     Title: President and CEO

 

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