Exhibit 10.1

 

EXCHANGE AGREEMENT

 

This Exchange Agreement (this “Agreement”) is made and entered into as of
July 16, 2017, by and between Marathon Patent Group, Inc. a Nevada corporation
(the “Company”), and the holder of warrants to purchase shares of common stock
of the Company named on the signature pages hereto (the “Holder”).

 

RECITALS

 

WHEREAS, the Holder currently holds warrants (the “Warrants”) to purchase an
aggregate of 760,000 shares of common stock of the Company that the Company
issued under a securities purchase agreement dated April 18, 2017 (the “Purchase
Agreement”);

 

WHEREAS, the Holder set forth on the signature page hereto desires to exchange
the Warrants for shares of common stock of the Company (the “Shares”), such
that, subject to the terms and conditions set forth herein, the Holder will be
issued (i) one share of common stock for each Warrant being exchanged by such
Holder plus (ii) 38,000 shares;

 

NOW, THEREFORE, in consideration of the premises and the agreements set forth
below, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties agree as follows:

 

ARTICLE I

 

Exchange and Waivers

 

Section 1.1                                    Waiver of Certain Rights under
Purchase Agreement. Effective upon the date hereof, the Holder hereby
irrevocably waives (i) its rights under Section 4.15 of the Purchase Agreement,
such that the Holder consents and agrees to any reverse or forward stock split
undertaken by the Company since the date of the Purchase Agreement and (ii) any
rights of the Holder under Section 4.11 of the Purchase Agreement with respect
to any Subsequent Financing (as defined under the Purchase Agreement) of the
Company of convertible preferred stock described by the Company in its next
proxy statement filed with the Securities and Exchange Commission (the “SEC”)
(collectively, the “Waivers”). For the avoidance of doubt, the Waivers are
irrevocably effective upon execution of this Agreement and will not be subject
to the conditions to Closing set forth in Section 1.4.

 

Section 1.2                                    Exchange of Warrants for Shares.

 

(a)               Upon the terms and subject to the conditions of this
Agreement, on the Closing Date (as defined below), the Holder, severally and not
jointly, shall exchange the Warrants for the Shares (the “Exchange”), such that
Holder will be issued (i) one share of common stock for each Warrant being
exchanged by such Holder plus (ii) 38,000 shares (collectively, the “Shares”).

 

(b)                                 Definitions:

 

“Action” means any action, suit, inquiry, notice of violation, proceeding or
investigation pending or, to the knowledge of the Company, threatened against

 

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the Company, any Subsidiary or any of their respective properties before or by
any court, arbitrator, governmental or administrative agency or regulatory
authority (federal, state, county, local or foreign).

 

“Common Stock” means the common stock of the Company, par value $0.0001 per
share, and any other class of securities into which such securities may
hereafter be reclassified or changed.

 

“Common Stock Equivalents” means any securities of the Company or the
Subsidiaries which would entitle the holder thereof to acquire at any time
Common Stock, including, without limitation, any debt, preferred stock, right,
option, warrant or other instrument that is at any time convertible into or
exercisable or exchangeable for, or otherwise entitles the holder thereof to
receive, Common Stock.

 

“FCPA” means the Foreign Corrupt Practices Act of 1977, as amended.

 

“Liens” means a lien, charge, pledge, security interest, encumbrance, right of
first refusal, preemptive right or other restriction.

 

“Person” means an individual, a limited liability company, a partnership, a
joint venture, a corporation, a trust, an unincorporated organization, any other
entity and a government or any department or agency thereof.

 

“Proceeding” means an action, claim, suit, investigation or proceeding
(including, without limitation, an informal investigation or partial proceeding,
such as a deposition), whether commenced or threatened.

 

“Rule 144” means Rule 144 under the Securities Act.

 

“Subsidiaries” means any Person in which the Company, directly or indirectly,
(I) owns any of the outstanding capital stock or holds any equity or similar
interest of such Person or (II) controls or operates all or any part of the
business, operations or administration of such Person, and each of the
foregoing, is individually referred to herein as a “Subsidiary.”

 

“Trading Day” means a day on which the principal Trading Market for the
Company’s common stock is open for trading.

 

“Trading Market” means any of the following markets or exchanges on which the
common stock is listed or quoted for trading on the date in question: the Nasdaq
Capital Market, the NYSE MKT, the Nasdaq Global Market, the Nasdaq Global Select
Market, the New York Stock Exchange, or the OTC Markets (or any successors to
any of the foregoing).

 

Section 1.3                                    Section 3(a)(9) Exchange. 
Pursuant to the Exchange, the Holder irrevocably agrees that the Holder shall
return the Warrants to the Company for cancellation in exchange for the issuance
by the Company of the Shares in accordance with Section 1.1. The

 

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issuance of the Shares to the Holder in the Exchange will be made without
registration of any of the Shares under the Securities Act of 1933, as amended
(together with the rules and regulations thereunder, the “Securities Act”), in
reliance upon the exemption therefrom provided by Section 3(a)(9) of the
Securities Act. The Holder acknowledges that the Company is relying upon the
truth and accuracy of, and the Holder’s compliance with, its representations,
warranties, agreements, acknowledgments and understandings set forth herein in
order to determine the availability of such exemption and the eligibility of the
Holder for the Exchange. Neither the Company nor the Holder shall take any
position contrary to this Section 1.3.

 

Section 1.4                                    Closing.  The closing of the
transactions contemplated by this Agreement (the “Closing”) shall occur on 9:00
a.m., New York City Time, on the first (1st) Trading Day on which the conditions
to the Closing set forth in Section 1.5 below are satisfied or, where legally
permissible, waived, or at such other time on the same date hereof or such other
date as the parties may agree in writing (such time and date, the “Closing
Date”). On the Closing Date, the Warrants shall be cancelled. The Company shall
issue the Shares in accordance with the terms hereof. On the Closing, Holder
shall return the Warrants being exchanged to the Company or execute whatever
documents of conveyance or transfer may be necessary or reasonably desirable to
confirm to the Company that such Warrants have all been cancelled. On the
Closing Date, the Company agrees to deliver to the Holder the Shares.

 

Section 1.5                                    Conditions to Closing.

 

(a)               The obligation of the Holder hereunder to consummate the
transactions contemplated hereby at the Closing is subject to the satisfaction,
at or before the Closing Date, of each of the following conditions, provided
that these conditions are for the Holder’s sole benefit and may, where legally
permissible, be waived by the Holder at any time in its sole discretion by
providing the Company with prior written notice thereof:

 

(i)                                     The Company shall have duly executed and
delivered to the Holder this Agreement.

 

(ii)                                  The representations and warranties of the
Company in this Agreement shall be true and correct in all material respects on
and as of the Closing Date with the same effect as if made on the Closing Date
and the Company has complied in all material respects with all the agreements
and satisfied all the conditions on its part to be performed or satisfied at or
prior to the Closing Date.

 

(iii)                               No statute, rule, regulation, executive
order, decree, ruling or injunction shall have been enacted, entered,
promulgated or endorsed by any court or governmental authority of competent
jurisdiction that prohibits the consummation of any of the transactions
contemplated by this Agreement.

 

(iv)                              The Exchange shall have been duly approved by
the Company’s shareholders.

 

(b)               The obligation of the Company hereunder to consummate the
transactions contemplated hereby at the Closing is subject to the satisfaction,
at or before the Closing Date, of each of the following conditions, provided
that these conditions are for the Company’s sole benefit

 

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and may, where legally permissible, be waived by the Company at any time in its
sole discretion by providing the Holder with prior written notice thereof:

 

(i)                                     The representations and warranties of
the Holder in this Agreement shall be true and correct in all material respects
on and as of the Closing Date with the same effect as if made on the Closing
Date and the Holder shall have complied in all material respects with all the
agreements and satisfied all the conditions on their part to be performed or
satisfied at or prior to the Closing Date.

 

(ii)                               No statute, rule, regulation, executive
order, decree, ruling or injunction shall have been enacted, entered,
promulgated or endorsed by any court or governmental authority of competent
jurisdiction that prohibits the consummation of any of the transactions
contemplated by this Agreement.

 

(iii)                               The Exchange shall have been duly approved
by the Company’s shareholders.

 

Section 1.6                                    Right of Holder. Notwithstanding
any provision in this Agreement to the contrary, the Holder maintains its right
to Exercise the Warrants until the Exchange has been approved by the
Shareholders.

 

ARTICLE II

 

Representations and Warranties of the Holder

 

The Holder hereby makes the following representations and warranties, each of
which is true and correct on and as of the date hereof and the Closing Date:

 

Section 2.1                                    Existence and Power.

 

(a)               The Holder is an individual or, if it is an entity, it is duly
organized, validly existing and in good standing under the laws of the
jurisdiction of its organization and has the power, authority and capacity to
execute and deliver this Agreement, to perform its obligations hereunder, and to
consummate the transactions contemplated hereby.

 

(b)               The execution of this Agreement by the Holder and the
consummation by the Holder of the transactions contemplated hereby do not and
will not constitute or result in a breach, violation, conflict or default under
any note, bond, mortgage, deed, indenture, lien, instrument, contract,
agreement, lease or license to which the Holder is a party, whether written or
oral, express or implied, or any statute, law, ordinance, decree, order,
injunction, rule, directive, judgment or regulation of any court, administrative
or regulatory body, governmental authority, arbitrator, mediator or similar body
on the part of the Holder or on the part of any other party thereto or cause the
acceleration or termination of any obligation or right of the Holder, except for
such breaches, conflicts, defaults, rights or violations which would not,
individually or in the aggregate, reasonably be expected to have a material
adverse effect on the ability of the Holder to perform its obligations
hereunder.

 

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Section 2.2                                    Valid and Enforceable Agreement;
Authorization.  This Agreement has been duly executed and delivered by the
Holder and constitutes a legal, valid and binding obligation of the Holder,
enforceable against the Holder in accordance with its terms, except that such
enforcement may be subject to (a) bankruptcy, insolvency, reorganization,
moratorium or other similar laws affecting or relating to enforcement of
creditors’ rights generally, and (b) general principles of equity.

 

Section 2.3                                    Title to Warrants.  The Holder
has good and valid title to the Warrants as set forth on the signature
pages hereto, free and clear of any mortgage, lien, pledge, charge, security
interest, encumbrance, title retention agreement, option, equity or other
adverse claim thereto. The Holder has not, in whole or in part, (i) assigned,
transferred, hypothecated, pledged or otherwise disposed of the Warrants or its
rights in such Warrants, or (ii) given any person or entity any transfer order,
power of attorney or other authority of any nature whatsoever with respect to
such Warrants which would limit the Holder’s power to transfer the Warrants
hereunder.

 

Section 2.4                                    Investment Decision.  The Holder
is an “accredited investor” within the meaning of Rule 501(a)(3) under the
Securities Act and was not organized for the purpose of acquiring the Shares.
The Holder is knowledgeable, sophisticated and experienced in business and
financial matters and has previously invested in securities similar to the
Shares. The Holder is able to bear the economic risk of its investment in the
Shares and is presently able to afford the complete loss of such investment.

 

The Holder (or its authorized representative) has had the opportunity to review
the SEC Reports. The Holder has had such opportunity to ask questions of the
Company and its representative and to obtain from representatives of the Company
such information as is necessary to permit it to evaluate the merits and risks
of its investment in the Company. The Holder has independently, without reliance
upon any representatives of the Company and based on such information as the
Holder deemed appropriate, made its own analysis and decision to enter into this
Agreement. The Holder has had the opportunity to consult with its accounting,
tax, financial and legal advisors to be able to evaluate the risks involved in
the Exchange pursuant hereto and to make an informed investment decision with
respect to such exchange.

 

The Holder acknowledges that the Company is relying on the truth and accuracy of
the foregoing representations and warranties in the offering of the Shares to
the Holder without having first registered the Shares under the Securities Act.

 

Section 2.5                                    Understandings or Arrangements. 
Such Holder is acquiring the Shares as principal for its own account and has no
direct or indirect arrangement or understandings with any other persons to
distribute or regarding the distribution of such Shares (this representation and
warranty not limiting such Holder’s right to sell the Shares in compliance with
applicable federal and state securities laws). Such Holder understands that the
Shares are “restricted securities” and have not been registered under the
Securities Act or any applicable state securities law and is acquiring such
Shares as principal for his, her or its own account and not with a view to or
for distributing or reselling such Shares or any part thereof in violation of
the Securities Act or any applicable state securities law, has no present
intention of distributing any of such Shares in violation of the Securities Act
or any applicable state securities law and has no

 

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direct or indirect arrangement or understandings with any other persons to
distribute or regarding the distribution of such Holder in violation of the
Securities Act or any applicable state securities law (this representation and
warranty not limiting such Holder’s right to sell such Holder pursuant to a
registration statement or otherwise in compliance with applicable federal and
state securities laws). The Holder agrees to the imprinting of a legend on the
Shares in substantially the following form:

 

THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED, OR APPLICABLE STATE SECURITIES LAWS 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 FORM ACCEPTABLE
TO THE COMPANY, THAT REGISTRATION IS NOT REQUIRED UNDER SAID ACT OR APPLICABLE
STATE SECURITIES LAWS OR UNLESS SOLD PURSUANT TO RULE 144 UNDER SAID ACT.

 

Section 2.6                                    Affiliate Status.  The Holder is
not, and has not been during the preceding three months, an “affiliate” of the
Company as such term is defined in Rule 144 under the Securities Act.

 

Section 2.7                                    Professional Advice.  With
respect to the tax, accounting and other economic considerations involved in the
Exchange, the Holder is not relying on the Company or any of its affiliates, and
the Holder has carefully considered and has, to the extent the Holder believes
such discussion is necessary, discussed with the Holder’s professional legal,
tax, accounting and financial advisors the implications of the Exchange for the
Holder’s particular tax, accounting and financial situation.

 

Section 2.8                                    No Solicitation.  The Holder was
not solicited by anyone on behalf of the Company to enter into this transaction.
The Holder has not engaged any third party as broker or finder or incurred or
become obligated to pay any broker’s commission or finder’s fee in connection
with the transactions contemplated by this Agreement.

 

ARTICLE III

 

Representations, Warranties and Covenants of the Company

 

The Company hereby makes the following representations, warranties, and
covenants each of which is true and correct on and as of the date hereof and the
Closing Date and shall survive the Closing Date and the transactions
contemplated hereby to the extent set forth herein.

 

Section 3.1                                    Existence and Power.

 

(a)               The Company is duly incorporated, validly existing and in good
standing under the laws of the state of Nevada, with the requisite power and
authority to own and use its properties and assets and to carry on its business
as currently conducted. The Company has the requisite power and authority to
execute and deliver this Agreement, to perform its obligations hereunder and
consummate the transactions contemplated hereby. The execution and delivery of
this Agreement by the Company and the consummation by the Company of the
transactions

 

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contemplated hereby and thereby, including, without limitation, the issuance of
the Shares hereunder and thereunder, have been duly authorized by the Board of
Directors of the Company, and, subject to the satisfaction of the closing
conditions set forth in this Agreement (including, without limitation, approval
of the Exchange by the Company’s shareholders), no further consent, approval or
authorization is required by the Company or of its Board of Directors or
shareholders in order for the Company to perform its obligations hereunder and
thereunder and to consummate the transactions contemplated hereby and thereby,
including, without limitation, the issuance of the Shares hereunder and
thereunder.

 

(b)               The execution of this Agreement by the Company and the
consummation by the Company of the transactions contemplated hereby and thereby
(i) do not require the consent, approval, authorization, order, registration or
qualification of, or filing with, any governmental authority or court, or body
or arbitrator having jurisdiction over the Company, except for any filings
required under state securities laws or with the SEC; and (ii) do not and will
not constitute or result in a breach, violation or default under any note, bond,
mortgage, deed, indenture, lien, instrument, contract, agreement, lease or
license, whether written or oral, express or implied, or with the articles of
incorporation or bylaws of the Company, or any statute, law, ordinance, decree,
order, injunction, rule, directive, judgment or regulation of any court,
administrative or regulatory body, governmental authority, arbitrator, mediator
or similar body on the part of the Company or on the part of any other party
thereto or cause the acceleration or termination of any obligation or right of
the Company or any other party thereto, except for such breaches, violations or
defaults which would not reasonably be expected to, singly or in the aggregate,
result in (i) a material adverse effect on the legality, validity or
enforceability of this Agreement, (ii) a material adverse effect on the results
of operations, assets, business, prospects or condition (financial or otherwise)
of the Company and the Subsidiaries, taken as a whole, or (iii) a material
adverse effect on the Company’s ability to perform in any material respect on a
timely basis its obligations under this Agreement (any of (i), (ii) or (iii), a
“Material Adverse Effect”)

 

Section 3.2                                    Valid and Enforceable Agreement;
Authorization.  This Agreement has been duly executed and delivered by the
Company and constitutes a legal, valid and binding obligation of the Company,
enforceable against the Company in accordance with its terms, except that such
enforcement may be subject to (a) bankruptcy, insolvency, reorganization,
moratorium or other similar laws affecting or relating to enforcement of
creditors’ rights generally, and (b) general principles of equity.

 

Section 3.3                                    Valid Issuance of
Securities.  The issuance of the Shares is duly authorized and, upon issuance in
accordance with the terms of this Agreement, the Shares will be validly issued,
fully paid and non-assessable. Assuming the accuracy of the representations of
the Holder in Article II of this Agreement, the Shares will be issued in
compliance with all applicable federal and state securities laws. The offer and
issuance of the Shares is exempt from registration under the Securities Act
pursuant to the exemption provided by Section 3(a)(9) thereof and is exempt
under any applicable state securities or “blue sky” laws. The Company has a
sufficient number of authorized and unissued shares of common stock to
consummate the Exchange.

 

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Section 3.4                                    No Broker.  The Company has not
engaged any third party as broker or finder or incurred or become obligated to
pay any broker’s commission or finder’s fee in connection with the transactions
contemplated by this Agreement.

 

Section 3.5.                                 Capitalization. The capitalization
of the Company is as set forth in its SEC Reports. Except as set forth in the
SEC Reports, no Person has any right of first refusal, preemptive right, right
of participation, or any similar right to participate in the transactions
contemplated by this Agreement. Except as set forth in the SEC Reports, there
are no outstanding options, warrants, scrip rights to subscribe to, calls or
commitments of any character whatsoever relating to, or securities, rights or
obligations convertible into or exercisable or exchangeable for, or giving any
Person any right to subscribe for or acquire, any shares of common stock or the
capital stock of any Subsidiary, or contracts, commitments, understandings or
arrangements by which the Company or any Subsidiary is or may become bound to
issue additional shares of Common Stock or Common Stock Equivalents or capital
stock of any Subsidiary. The issuance and sale of the Shares will not obligate
the Company or any Subsidiary to issue shares of Common Stock or other
securities to any Person (other than the Holder) and will not result in a right
of any holder of Company securities to adjust the exercise, conversion, exchange
or reset price under any of such securities. There are no outstanding securities
or instruments of the Company or any Subsidiary that contain any redemption or
similar provisions, and there are no contracts, commitments, understandings or
arrangements by which the Company or any Subsidiary is or may become bound to
redeem a security of the Company or such Subsidiary. The Company does not have
any stock appreciation rights or “phantom stock” plans or agreements or any
similar plan or agreement. All of the outstanding shares of capital stock of the
Company are duly authorized, validly issued, fully paid and nonassessable, have
been issued in compliance with all federal and state securities laws, and none
of such outstanding shares was issued in violation of any preemptive rights or
similar rights to subscribe for or purchase securities. No further approval or
authorization of any stockholder, the Board of Directors or others is required
for the issuance and sale of the Shares except as contemplated under this
Agreement.

 

Section 3.6                                    SEC Reports; Financial
Statements.  The Company has filed all reports, schedules, forms, statements and
other documents required to be filed by the Company under the Securities Act and
the Exchange Act, including pursuant to Section 13(a) or 15(d) thereof, for the
two years preceding the date hereof (or such shorter period as the Company was
required by law or regulation to file such material) (the foregoing materials,
including the exhibits thereto and documents incorporated by reference therein,
being collectively referred to herein as the “SEC Reports”) on a timely basis or
has received a valid extension of such time of filing and has filed any such SEC
Reports prior to the expiration of any such extension.  As of their respective
dates, the SEC Reports complied in all material respects with the requirements
of the Securities Act and the Exchange Act, as applicable, and none of the SEC
Reports, when filed, 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. The Company has never been an issuer
subject to Rule 144(i) under the Securities Act. The financial statements of the
Company included in the SEC Reports comply in all material respects with
applicable accounting requirements and the rules and regulations of the SEC with
respect thereto as in effect at the time of filing.  Such financial statements
have been prepared in accordance with United States generally accepted

 

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accounting principles applied on a consistent basis during the periods involved
(“GAAP”), except as may be otherwise specified in such financial statements or
the notes thereto and except that unaudited financial statements may not contain
all footnotes required by GAAP, and fairly present in all material respects the
financial position of the Company and its consolidated Subsidiaries as of and
for the dates thereof and the results of operations and cash flows for the
periods then ended, subject, in the case of unaudited statements, to normal,
immaterial, year-end audit adjustments.

 

Section 3.7.                                 Material Changes; Undisclosed
Events, Liabilities or Developments.  Since the date of the latest audited
financial statements included within the SEC Reports, except as specifically
disclosed in a subsequent SEC Report filed prior to the date hereof, (i) there
has been no event, occurrence or development that has had or that could
reasonably be expected to result in a Material Adverse Effect, (ii) the Company
has not incurred any liabilities (contingent or otherwise) other than (A) trade
payables and accrued expenses incurred in the ordinary course of business
consistent with past practice and (B) liabilities not required to be reflected
in the Company’s financial statements pursuant to GAAP or disclosed in filings
made with the Commission, (iii) the Company has not altered its method of
accounting, (iv) the Company has not declared or made any dividend or
distribution of cash or other property to its stockholder or purchased, redeemed
or made any agreements to purchase or redeem any shares of its capital stock and
(v) the Company has not issued any equity securities to any officer, director or
Affiliate, except pursuant to existing Company stock option plans.  The Company
does not have pending before the Commission any request for confidential
treatment of information. Except for the issuance of the Shares contemplated by
this Agreement no event, liability, fact, circumstance, occurrence or
development has occurred or exists or is reasonably expected to occur or exist
with respect to the Company or its Subsidiaries or their respective businesses,
prospects, properties, operations, assets or financial condition that would be
required to be disclosed by the Company under applicable securities laws at the
time this representation is made or deemed made that has not been publicly
disclosed at least 1 Trading Day prior to the date that this representation is
made.

 

Section 3.8.                                 Litigation.  Except in the ordinary
course of the Company’s business, as a patent infringement monetization company,
there is no action, suit, inquiry, notice of violation, proceeding or
investigation pending or, to the knowledge of the Company, threatened against or
affecting the Company, any Subsidiary or any of their respective properties
before or by any court, arbitrator, governmental or administrative agency or
regulatory authority (federal, state, county, local or foreign) (collectively,
an “Action”) which (i) adversely affects or challenges the legality, validity or
enforceability of any of this Agreement or (ii) could, if there were an
unfavorable decision, have or reasonably be expected to result in a Material
Adverse Effect.  Neither the Company nor any Subsidiary, nor any director or
officer thereof, is or has been the subject of any Action involving a claim of
violation of or liability under federal or state securities laws or a claim of
breach of fiduciary duty. 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 or any current or former director or officer of the
Company.  The Commission has not issued any stop order or other order suspending
the effectiveness of any registration statement filed by the Company or any
Subsidiary under the Exchange Act or the Securities Act.

 

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Section 3.9.                                 Labor Relations.  No labor dispute
exists or, to the knowledge of the Company, is imminent with respect to any of
the employees of the Company, which could reasonably be expected to result in a
Material Adverse Effect. None of the Company’s or its Subsidiaries’ employees is
a member of a union that relates to such employee’s relationship with the
Company or such Subsidiary, and neither the Company nor any of its Subsidiaries
is a party to a collective bargaining agreement, and the Company and its
Subsidiaries believe that their relationships with their employees are good. To
the knowledge of the Company, no executive officer of the Company or any
Subsidiary, is, or is now expected to be, in violation of any material term of
any employment contract, confidentiality, disclosure or proprietary information
agreement or non-competition agreement, or any other contract or agreement or
any restrictive covenant in favor of any third party, and the continued
employment of each such executive officer does not subject the Company or any of
its Subsidiaries to any liability with respect to any of the foregoing matters.
To the knowledge of the Company, the Company and its Subsidiaries are in
compliance with all U.S. federal, state, local and foreign laws and regulations
relating to employment and employment practices, terms and conditions of
employment and wages and hours, except where the failure to be in compliance
could not, individually or in the aggregate, reasonably be expected to have a
Material Adverse Effect.

 

Section 3.10                             Compliance.  Neither the Company nor
any Subsidiary: (i) is in default under or in violation of (and no event has
occurred that has not been waived that, with notice or lapse of time or both,
would result in a default by the Company or any Subsidiary under), nor has the
Company or any Subsidiary received notice of a claim that it is in default under
or that it is in violation of, any indenture, loan or credit agreement or any
other agreement or instrument to which it is a party or by which it or any of
its properties is bound (whether or not such default or violation has been
waived), (ii) is in violation of any judgment, decree or order of any court,
arbitrator or other governmental authority or (iii) is or has been in violation
of any statute, rule, ordinance or regulation of any governmental authority,
including without limitation all foreign, federal, state and local laws relating
to taxes, environmental protection, occupational health and safety, product
quality and safety and employment and labor matters, except in each case as
could not have or reasonably be expected to result in a Material Adverse Effect.

 

Section 3.11                             Environmental Laws. The Company and its
Subsidiaries (i) are in compliance with all federal, state, local and foreign
laws relating to pollution or protection of human health or the environment
(including ambient air, surface water, groundwater, land surface or subsurface
strata), including laws relating to emissions, discharges, releases or
threatened releases of chemicals, pollutants, contaminants, or toxic or
hazardous substances or wastes (collectively, “Hazardous Materials”) into the
environment, or otherwise relating to the manufacture, processing, distribution,
use, treatment, storage, disposal, transport or handling of Hazardous Materials,
as well as all authorizations, codes, decrees, demands, or demand letters,
injunctions, judgments, licenses, notices or notice letters, orders, permits,
plans or regulations, issued, entered, promulgated or approved thereunder
(“Environmental Laws”); (ii) have received all permits licenses or other
approvals required of them under applicable Environmental Laws to conduct their
respective businesses; and (iii) are in compliance with all terms and conditions
of any such permit, license or approval where in each clause (i), (ii) and
(iii), the failure to so comply could be reasonably expected to have,
individually or in the aggregate, a Material Adverse Effect.

 

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Section 3.12                             Regulatory Permits.  The Company and
the Subsidiaries possess all certificates, authorizations and permits issued by
the appropriate federal, state, local or foreign regulatory authorities
necessary to conduct their respective businesses as described in the SEC
Reports, except where the failure to possess such permits could not reasonably
be expected to result in a Material Adverse Effect (“Material Permits”), and
neither the Company nor any Subsidiary has received any notice of proceedings
relating to the revocation or modification of any Material Permit.

 

Section 3.13                             Title to Assets.  The Company and the
Subsidiaries have good and marketable title in fee simple to all real property
owned by them and good and marketable title in all personal property owned by
them that is material to the business of the Company and the Subsidiaries, in
each case free and clear of all Liens, except for (i) Liens as do not materially
affect the value of such property and do not materially interfere with the use
made and proposed to be made of such property by the Company and the
Subsidiaries;  (ii) Liens for the payment of federal, state or other taxes, for
which appropriate reserves have been made therefor in accordance with GAAP and,
the payment of which is neither delinquent nor subject to penalties and
(iii) Liens disclosed in the Company’s SEC Reports. Any real property and
facilities held under lease by the Company and the Subsidiaries are held by them
under valid, subsisting and enforceable leases with which the Company and the
Subsidiaries are in compliance.

 

Section 3.14                             Intellectual Property.  The Company and
the Subsidiaries have, or have rights to use, all material patents, patent
applications, trademarks, trademark applications, service marks, trade names,
trade secrets, inventions, copyrights, licenses and other intellectual property
rights and similar rights necessary or required for use in connection with their
respective businesses as described in the SEC Reports and which the failure to
so have could have a Material Adverse Effect (collectively, the “Intellectual
Property Rights”). Other than as disclosed in the SEC Reports, none of, and
neither the Company nor any Subsidiary has received a notice (written or
otherwise) that any of, the Intellectual Property Rights has expired, terminated
or been abandoned, or is expected to expire or terminate or be abandoned, within
two (2) years from the date of this Agreement. Neither the Company nor any
Subsidiary has received, since the date of the latest audited financial
statements included within the SEC Reports, a written notice of a claim or
otherwise has any knowledge that the Intellectual Property Rights violate or
infringe upon the rights of any Person, except as could not have or reasonably
be expected to not have a Material Adverse Effect or as is an inherent part of
its business as a patent infringement monetization company. To the knowledge of
the Company, all such Intellectual Property Rights are enforceable. The Company
and its Subsidiaries have taken reasonable security measures to protect the
secrecy, confidentiality and value of all of their intellectual properties,
except where failure to do so could not, individually or in the aggregate,
reasonably be expected to have a Material Adverse Effect.

 

Section 3.15                             Insurance.  The Company and the
Subsidiaries are insured by insurers of recognized financial responsibility
against such losses and risks and in such amounts as are prudent and customary
in the businesses in which the Company and the Subsidiaries are engaged,
including, but not limited to, directors and officers insurance coverage at
least equal to the aggregate Subscription Amount. Neither the Company nor any
Subsidiary has any reason to believe that it will not be able to renew its
existing insurance coverage as and when such

 

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coverage expires or to obtain similar coverage from similar insurers as may be
necessary to continue its business without a significant increase in cost.

 

Section 3.16                             Transactions With Affiliates and
Employees.  Except as set forth in the SEC Reports, none of the officers or
directors of the Company or any Subsidiary and, to the knowledge of the Company,
none of the employees of the Company or any Subsidiary is presently a party to
any transaction with the Company or any Subsidiary (other than for services as
employees, officers and directors), including any contract, agreement or other
arrangement providing for the furnishing of services to or by, providing for
rental of real or personal property to or from, providing for the borrowing of
money from or lending of money to or otherwise requiring payments to or from any
officer, director or such employee or, to the knowledge of the Company, any
entity in which any officer, director, or any such employee has a substantial
interest or is an officer, director, trustee, stockholder, member or partner, in
each case in excess of $120,000 other than for (i) payment of salary or
consulting fees for services rendered, (ii) reimbursement for expenses incurred
on behalf of the Company and (iii) other employee benefits, including stock
option agreements under any stock option plan of the Company.

 

Section 3.17                             Sarbanes-Oxley; Internal Accounting
Controls.  The Company and the Subsidiaries are in compliance with any and all
applicable requirements of the Sarbanes-Oxley Act of 2002 that are effective as
of the date hereof, and any and all applicable rules and regulations promulgated
by the Commission thereunder that are effective as of the date hereof and as of
the Closing Date. The Company and the Subsidiaries maintain a system of internal
accounting controls sufficient to provide reasonable assurance that:
(i) transactions are executed in accordance with management’s general or
specific authorizations, (ii) transactions are recorded as necessary to permit
preparation of financial statements in conformity with GAAP and to maintain
asset accountability, (iii) access to assets is permitted only in accordance
with management’s general or specific authorization, and (iv) the recorded
accountability for assets is compared with the existing assets at reasonable
intervals and appropriate action is taken with respect to any differences. The
Company and the Subsidiaries have established disclosure controls and procedures
(as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the Company and
the Subsidiaries and designed such disclosure controls and procedures to ensure
that information required to be disclosed by the Company in the reports it files
or submits under the Exchange Act is recorded, processed, summarized and
reported, within the time periods specified in the Commission’s rules and forms.
The Company’s certifying officers have evaluated the effectiveness of the
disclosure controls and procedures of the Company and the Subsidiaries as of the
end of the period covered by the most recently filed periodic report under the
Exchange Act (such date, the “Evaluation Date”). The Company presented in its
most recently filed periodic report under the Exchange Act the conclusions of
the certifying officers about the effectiveness of the disclosure controls and
procedures based on their evaluations as of the Evaluation Date. Since the
Evaluation Date, there have been no changes in the internal control over
financial reporting (as such term is defined in the Exchange Act) of the Company
and its Subsidiaries that have materially affected, or is reasonably likely to
materially affect, the internal control over financial reporting of the Company
and its Subsidiaries.

 

Section 3.18.                       Investment Company. The Company is not, and
is not an Affiliate of an “investment company” within the meaning of the
Investment Company Act of 1940, as amended.

 

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Section 3.19                             Registration Rights.  Other than the
Purchase Agreement Holder or as set forth in the SEC Reports, no Person has any
right to cause the Company or any Subsidiary to effect the registration under
the Securities Act of any securities of the Company or any Subsidiary.

 

Section 3.20                             Listing and Maintenance Requirements. 
The Common Stock is registered pursuant to Section 12(b) or 12(g) of the
Exchange Act, and the Company has taken no action designed to, or which to its
knowledge is likely to have the effect of, terminating the registration of the
Common Stock under the Exchange Act nor has the Company received any
notification that the Commission is contemplating terminating such
registration.  The Company has not, in the 12 months preceding the date hereof,
received notice from any Trading Market on which the Common Stock is or has been
listed or quoted to the effect that the Company is not in compliance with the
listing or maintenance requirements of such Trading Market, except as set forth
in the SEC Reports. The Company is, and has no reason to believe that it will
not in the foreseeable future continue to be, in compliance with all such
listing and maintenance requirements. The Common Stock is currently eligible for
electronic transfer through the Depository Trust Company or another established
clearing corporation and the Company is current in payment of the fees to the
Depository Trust Company (or such other established clearing corporation) in
connection with such electronic transfer.

 

Section 3.21.                          Application of Takeover Protections.  The
Company and the Board of Directors have taken all necessary action, if any, in
order to render inapplicable any control share acquisition, business
combination, poison pill (including any distribution under a rights agreement)
or other similar anti takeover provision under the Company’s certificate of
incorporation (or similar charter documents) or the laws of its state of
incorporation that is or could become applicable to the Holder as a result of
the Holder and the Company fulfilling their obligations or exercising their
rights under this Agreement, including without limitation as a result of the
Company’s issuance of the Shares and the Holder’s ownership of the Shares.

 

Section 3.22.                          Disclosure.  Except with respect to the
material terms and conditions of the transactions contemplated by this
Agreement, the Company confirms that neither it nor any other Person acting on
its behalf has provided the Holder or its agents or counsel with any information
that it believes constitutes or might constitute material, non-public
information which is not otherwise disclosed in the SEC Reports. The Company
understands and confirms that the Holder will rely on the foregoing
representation in effecting transactions in securities of the Company.  All of
the disclosure furnished by or on behalf of the Company to the Holder regarding
the Company and its Subsidiaries, their respective businesses and the
transactions contemplated hereby, 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 light of the circumstances
under which they were made, not misleading. The press releases disseminated by
the Company during the twelve months preceding the date of this Agreement taken
as a whole do not contain any untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary in order to
make the statements therein, in light of the circumstances under which they were
made and when made, not misleading. The Company acknowledges and agrees that the
Holder makes no and has made no representations or warranties with respect to
the transactions contemplated hereby other than those specifically set forth in
Article II hereof.

 

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Section 3.23                             Tax Status.  Except for matters that
would not, individually or in the aggregate, have or reasonably be expected to
result in a Material Adverse Effect, the Company and its Subsidiaries each
(i) has made or filed all United States federal, state and local income and all
foreign income and franchise tax returns, reports and declarations required by
any jurisdiction to which it is subject, (ii) has paid all taxes and other
governmental assessments and charges that are material in amount, shown or
determined to be due on such returns, reports and declarations and (iii) has set
aside on its books provisions reasonably adequate for the payment of all
material taxes for periods subsequent to the periods to which such returns,
reports or declarations apply.  There are no unpaid taxes in any material amount
claimed to be due by the taxing authority of any jurisdiction, and the officers
of the Company or of any Subsidiary know of no basis for any such claim.

 

Section 3.24                             Foreign Corrupt Practices.  Neither the
Company nor any Subsidiary, nor to the knowledge of the Company or any
Subsidiary, any agent or other person acting on behalf of the Company or any
Subsidiary, has (i) directly or indirectly, used any funds for unlawful
contributions, gifts, entertainment or other unlawful expenses related to
foreign or domestic political activity, (ii) made any unlawful payment to
foreign or domestic government officials or employees or to any foreign or
domestic political parties or campaigns from corporate funds, (iii) failed to
disclose fully any contribution made by the Company or any Subsidiary (or made
by any person acting on its behalf of which the Company is aware) which is in
violation of law, or (iv) violated in any material respect any provision of the
FCPA.

 

Section 3.25                             Accountants.  The Company’s accounting
firm is BDO USA, LLP.  To the knowledge and belief of the Company, such
accounting firm (i) is a registered public accounting firm as required by the
Exchange Act and (ii) shall express its opinion with respect to the financial
statements to be included in the Company’s Annual Report for the fiscal year
ending December 31, 2017.

 

Section 3.26                             Acknowledgment Regarding Holder’s
Acquisition of Shares. The Company acknowledges and agrees that the Holder is
acting solely in the capacity of an arm’s length party with respect to this
Agreement and the transactions contemplated thereby.  The Company further
acknowledges that the Holder is not acting as a financial advisor or fiduciary
of the Company (or in any similar capacity) with respect to this Agreement and
the transactions contemplated thereby and any advice given by the Holder or any
of its representatives or agents in connection with this Agreement and the
transactions contemplated thereby is merely incidental to the Holder’s
acquisition of the Shares. The Company further represents to the Holder that the
Company’s decision to enter into this Agreement has been based solely on the
independent evaluation of the transactions contemplated hereby by the Company
and its representatives.

 

Section 3.27                          Regulation M Compliance.  The Company has
not, and to its knowledge no one acting on its behalf has, (i) taken, directly
or indirectly, any action designed to cause or to result in the stabilization or
manipulation of the price of any security of the Company to facilitate the sale
or resale of any of the Shares, (ii) sold, bid for, purchased, or, paid any
compensation for soliciting the Exchange of any of the Shares.

 

Section 3.28                          Office of Foreign Assets Control.  Neither
the Company nor any Subsidiary nor, to the Company’s knowledge, any director,
officer, agent, employee or affiliate of the

 

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Company  or any Subsidiary is currently subject to any U.S. sanctions
administered by the Office of Foreign Assets Control of the U.S. Treasury
Department (“OFAC”).

 

Section 3.29                             U.S. Real Property Holding
Corporation.  The Company is not and has never been a U.S. real property holding
corporation within the meaning of Section 897 of the Internal Revenue Code of
1986, as amended, and the Company shall so certify upon Holder’s request.

 

Section 3.30                             Bank Holding Company Act.  Neither the
Company nor any of its Subsidiaries or Affiliates is subject to the Bank Holding
Company Act of 1956, as amended (the “BHCA”) and to regulation by the Board of
Governors of the Federal Reserve System (the “Federal Reserve”).  Neither the
Company nor any of its Subsidiaries or Affiliates owns or controls, directly or
indirectly, five percent (5%) or more of the outstanding shares of any class of
voting securities or twenty-five percent or more of the total equity of a bank
or any entity that is subject to the BHCA and to regulation by the Federal
Reserve.  Neither the Company nor any of its Subsidiaries or Affiliates
exercises a controlling influence over the management or policies of a bank or
any entity that is subject to the BHCA and to regulation by the Federal Reserve.

 

Section 3.31                             Money Laundering.  The operations of
the Company and its Subsidiaries are and have been conducted at all times in
compliance with applicable financial record-keeping and reporting requirements
of the Currency and Foreign Transactions Reporting Act of 1970, as amended,
applicable money laundering statutes and applicable rules and regulations
thereunder (collectively, the “Money Laundering Laws”), and no Action or
Proceeding by or before any court or governmental agency, authority or body or
any arbitrator involving the Company or any Subsidiary with respect to the Money
Laundering Laws is pending or, to the knowledge of the Company or any
Subsidiary, threatened.

 

ARTICLE IV

 

Additional Agreements

 

Section 4.1                                    Reasonable Best Efforts.  The
Holder shall use its reasonable best efforts to timely satisfy each of the
conditions to be satisfied by it as provided in Section 1.4(b) of this
Agreement. The Company shall use its reasonable best efforts to timely satisfy
each of the conditions to be satisfied by it as provided in Section 1.5(a) of
this Agreement.

 

Section 4.2                                    Registration Rights. The Shares
shall be included in the first Registration Statemen the Company prepares and
files with the SEC subsequent to the execution of this agreement.  The Company
shall prepare and file, by October 15, 2017, a registration statement with the
SEC for the resale of the Shares to be made on a continuous basis pursuant to
Rule 415 under the Securities Act (the “Registration Statement”). The
Registration Statement shall be on Form S-1 or, if the Company is so eligible,
on Form S-3 (except if the Company is not then eligible to register for resale
the Shares on Form S-1 or Form S-3, as the case may be, in which case such
registration shall be on another appropriate form in accordance herewith). The
Company shall use its reasonable best efforts to have such Registration
Statement declared effective by the SEC as soon as practicable thereafter, and
no later than November 1, 2017 (the “Effectiveness Deadline”). The Holder shall
furnish to the Company such information regarding

 

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such Holder as reasonably requested by the Company to effect the registration of
such Holder’s Shares. In the event that the Registration Statement is not
declared effective by the Effectiveness Deadline, then, in addition to any other
rights the Holder may have hereunder or under applicable law, the Company shall
pay to the Holder on each monthly anniversary of the Effectiveness Deadline (if
the Registration Statement has not been declared effective) until the
Registration Statement has been declared effective an amount, as partial
liquidated damages and not as a penalty, equal to 1.0% of the Subscription
Amount (pro rated for any partial month in which the Registration Statement in
not effective) by such Holder under the Purchase Agreement, provided, however,
the Company shall not pay to the Holder more than 6.0% of the Subscription
Amount for such Holder pursuant to this Section 4.2.

 

Section 4.3                                    Disclosure of Transactions and
Other Material Information.  The Company shall by 9:00 a.m. (New York City time)
on the Trading Day immediately following the date of execution of this
Agreement, and the Closing Date, respectively, issue a press release (the
“Current Report”) disclosing the material terms of the transactions contemplated
hereby and the closing thereof, as applicable. From and after the issuance of
such press release, the Company represents to the Holder that the Company shall
have publicly disclosed all material, non-public information delivered to the
Holder as of such time 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 this Agreement. The Company shall file a Current
Report on Form 8-K disclosing all material terms of this Agreement and including
the form of this Agreement as an exhibit thereto simultaneously with the filing
of the Company’s proxy statement for approval of the Exchange.

 

Section 4.4                                    Removal of Legends. The Company
shall cause certificates evidencing the Shares to not contain any legend:
(i) while a registration statement covering the resale of such Shares is
effective under the Securities Act, or (ii) following any sale of such Shares
pursuant to Rule 144, (iii) if such Shares are eligible for sale under Rule 144
without regard to the current information requirements under Rule 144(c). The
Company agrees that following such time as such legend is no longer required
under this Section 4.4, the Company will upon written request of the Holder, no
later than the earlier of (i) three Trading Days and (ii) the number of Trading
Days comprising the Standard Settlement Period (as defined below) following the
delivery by the Holder of a written request for legend removal and a certificate
representing Shares eligible for such legend removal issued with a restrictive
legend (such third Trading Day, the “Legend Removal Date”), deliver or cause to
be delivered to such Holder a certificate representing such shares that is free
from all restrictive and other legends. The Company may not make any notation on
its records or give instructions to the Transfer Agent that enlarge the
restrictions on transfer set forth in this Section 4.4. The Company shall cause
certificates for Shares subject to legend removal hereunder to be transmitted by
the Transfer Agent to the Holder by crediting the account of the Holder’s prime
broker with the Depository Trust Company System as directed by such Holder. As
used herein, “Standard Settlement Period” means the standard settlement period,
expressed in a number of Trading Days, on the Company’s primary Trading Market
with respect to the Common Stock as in effect on the date of delivery of a
certificate representing Warrant Shares issued with a restrictive legend.

 

Section 4.5.                                 Shareholder Approval of Exchange.
The Company shall hold a shareholder meeting within 45 days of the date hereof
at which the Company shall present to shareholders a

 

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proposal for approval of the Exchange. In the event the Exchange is not approved
at such shareholder meeting, the Company shall hold an additional shareholder
meeting, within 90 days of the first such shareholder meeting, at which the
Company shall present to shareholders a proposal for approval of the Exchange.
Until such time as the Exchange is approved by shareholders of the Company, the
Company shall continue to hold shareholder meetings, each held within 90 days of
the prior shareholder meeting. In the event that the Exchange has not been
approved by shareholders of the Company within 45 days of the date hereof (the
“Shareholder Approval Deadline”), then, in addition to any other rights the
Holder may have hereunder or under applicable law, the Company shall pay to the
Holder on each 45-day anniversary of the Shareholder Approval Deadline (if such
shareholder approval has not been obtained) until such shareholder approval has
been obtained as partial liquidated damages and not as a penalty, equal to 1.0%
of the Subscription Amount by such Holder under the Purchase Agreement for each
month past the Shareholder Approval Deadline that the shareholder approval has
not been obtained (pro rated for any partial month in which such shareholder
approval has not been obtained), provided, however, the Company shall not pay to
the Holder more than 12.0% of the Subscription Amount for such Holder pursuant
to this Section 4.5.

 

ARTICLE V

 

Miscellaneous Provisions

 

Section 5.1                                    Survival of Representations and
Warranties.  The agreements of the Company, as set forth herein, and the
respective representations and warranties of the Holder and the Company as set
forth herein in Articles II and III, respectively, shall survive until the
Closing Date.

 

Section 5.2                                    Notice.  Any and all notices or
other communications or deliveries required or permitted to be provided
hereunder shall be in writing and shall be deemed given and effective on the
earliest of: (a) the date of transmission, if such notice or communication is
delivered via facsimile at the facsimile number or email at the email address as
set forth on the signature pages attached hereto at or prior to 5:30 p.m. (New
York City time) on a Trading Day, (b) the next Trading Day after the date of
transmission, if such notice or communication is delivered via facsimile at the
facsimile number or email at the email address as set forth on the signature
pages attached hereto on a day that is not a Trading Day or later than 5:30
p.m. (New York City time) on any Trading Day, (c) the second (2nd) Trading Day
following the date of mailing, if sent by U.S. nationally recognized overnight
courier service or (d) upon actual receipt by the party to whom such notice is
required to be given. The address for such notices and communications shall be
as set forth on the signature pages attached hereto.

 

Section 5.3                                    Entire Agreement.  This Agreement
and the other documents and agreements executed in connection with the Exchange
embody the entire agreement and understanding of the parties hereto with respect
to the subject matter hereof and supersede all prior and contemporaneous oral or
written agreements, representations, warranties, contracts, correspondence,
conversations, memoranda and understandings between or among the parties or any
of their agents, representatives or affiliates relative to such subject matter,
including, without limitation, any term sheets, emails or draft documents.

 

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Section 5.4                                    Assignment; Binding
Agreement.  This Agreement shall be binding upon and inure to the benefit of the
parties and their successors and permitted assigns. The Company may not assign
this Agreement or any rights or obligations hereunder without the prior written
consent of each Holder (other than by merger). Any Holder may assign any or all
of its rights under this Agreement to any Person to whom such Holder assigns or
transfers any Warrants, provided that such transferee agrees in writing to be
bound, with respect to the transferred Warrants, by the provisions of this
Agreement.

 

Section 5.5                                    Counterparts.  This Agreement may
be executed in multiple counterparts, and on separate counterparts, each of
which shall be deemed an original, but all of which taken together shall
constitute one and the same instrument. Any counterpart or other signature
hereupon delivered by facsimile shall be deemed for all purposes as constituting
good and valid execution and delivery of this Agreement by such party.

 

Section 5.6                                    Remedies Cumulative.  Except as
otherwise provided herein, all rights and remedies of the parties under this
Agreement are cumulative and without prejudice to any other rights or remedies
available at law.

 

Section 5.7                                    Governing Law.  All questions
concerning the construction, validity, enforcement and interpretation of this
Agreement shall be governed by and construed and enforced in accordance with the
internal laws of the State of New York, without regard to the principles of
conflicts of law thereof. Each party agrees that all legal Proceedings
concerning the interpretations, enforcement and defense of the transactions
contemplated by this Agreement (whether brought against a party hereto or its
respective affiliates, directors, officers, shareholders, partners, members,
employees or agents) shall be commenced exclusively in the state and federal
courts sitting in the City of New York. Each party 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 with any transaction contemplated hereby or
discussed herein (including with respect to the enforcement of this Agreement),
and hereby irrevocably waives, and agrees not to assert in any Action or
Proceeding, any claim that it is not personally subject to the jurisdiction of
any such court, that such Action or Proceeding is improper or is an inconvenient
venue for such Proceeding. Each party hereby irrevocably waives personal service
of process and consents to process being served in any such Action or Proceeding
by mailing a copy thereof via registered or certified mail or overnight delivery
(with evidence of delivery) to such party at the address in effect for notices
to it under this Agreement and agrees that such service shall constitute good
and sufficient service of process and notice thereof. Nothing contained herein
shall be deemed to limit in any way any right to serve process in any other
manner permitted by law. If any party shall commence an Action or Proceeding to
enforce any provisions of this Agreement, then, the prevailing party in such
Action or Proceeding shall be reimbursed by the non-prevailing party for its
reasonable attorneys’ fees and other costs and expenses incurred with the
investigation, preparation and prosecution of such Action or Proceeding.

 

Section 5.8                                    No Third Party Beneficiaries or
Other Rights.  This Agreement is intended for the benefit of the parties hereto
and their respective permitted successors and assigns, and is not for the
benefit of, nor may any provision hereof be enforced by, any other Person.

 

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Section 5.9                                    Amendments; Waivers.  No
provision of this Agreement may be waived, modified, supplemented or amended
except in a written instrument signed, in the case of an amendment, by the
Company and the Holder. No waiver of any default with respect to any provision,
condition or requirement of this Agreement shall be deemed to be a continuing
waiver in the future or a waiver of any subsequent default or a waiver of any
other provision, condition or requirement hereof, nor shall any delay or
omission of any party to exercise any right hereunder in any manner impair the
exercise of any such right..

 

Section 5.10                             Word Meanings.  The words such as
“herein,” “hereinafter,” “hereof” and “hereunder” refer to this Agreement as a
whole and not merely to a subdivision in which such words appear unless the
context otherwise requires. The singular shall include the plural, and vice
versa, unless the context otherwise requires. The masculine shall include the
feminine and neuter, and vice versa, unless the context otherwise requires.

 

Section 5.11                             Further Assurances.  The Holder and the
Company each hereby agree to execute and deliver, or cause to be executed and
delivered, such other documents, instruments and agreements, and take such other
actions, as either party may reasonably request in connection with the
transactions contemplated by this Agreement.

 

Section 5.12                             Costs and Expenses.  The Holder and the
Company shall each pay their own respective costs and expenses incurred in
connection with the negotiation, preparation, execution and performance of this
Agreement, including, but not limited to, attorneys’ fees.

 

Section 5.13                             Headings.  The headings in this
Agreement are for convenience of reference only and shall not limit or otherwise
affect the meaning hereof.

 

Section 5.14                             Severability. If any one or more of the
provisions contained herein, or the application thereof in any circumstance, is
held invalid, illegal or unenforceable, the validity, legality and
enforceability of any such provision in every other respect and of the remaining
provisions contained herein shall not be affected or impaired thereby.

 

Section 5.16 Holder.

 

[the remainder of this page is intentionally left blank]

 

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

 

 

MARATHON PATENT GROUP, INC.

Address for Notice:
11100 Santa Monica Blvd., Ste. 380
Los Angeles, CA

 

 

 

 

By:

 

 

 

 

Name:

E-Mail:

 

Title:

Fax:

 

 

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

 

 

 

 

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK

SIGNATURE PAGE FOR HOLDER FOLLOWS]

 

Signature Page to Exchange Agreement

 

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

 

 

Name of Holder:

 

 

Signature of Authorized Signatory of Holder:

 

 

Name of Authorized Signatory:

 

 

Title of Authorized Signatory:

 

 

Email Address of Authorized Signatory:

 

 

Facsimile Number of Authorized Signatory:

 

 

Address for Notice to Holder:

 

 

Number of Warrants Exchanged:

 

Address for Delivery of Shares to Holder (if not same as address for notice):

 

 

EIN Number:

 

 

 

Signature Page to Exchange Agreement

 

21

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