Exhibit 10.2


 


REGISTRATION RIGHTS AGREEMENT


 


This Registration Rights Agreement
(this “Agreement”) is made and entered into as of October 15, 2021 between C-Bond Systems, Inc., a Colorado
corporation (the “Company”) and Mercer Street Global Opportunity Fund, LLC, a Delaware limited liability company
(“Holder”).


 


WHEREAS, the Company and the
Holder are parties to that certain Securities Purchase Agreement, dated as of the date of this Agreement (the “Purchase Agreement”),
pursuant to which the Holder is purchasing the Note and Warrants of the Company; and


 


WHEREAS, in connection with
the consummation of the transactions contemplated by the Purchase Agreement, and pursuant to the terms of the Purchase Agreement, the
parties desire to enter into this Agreement in order to grant certain registration rights to the Holder as set forth below.


 


NOW, THEREFORE, in consideration
of the foregoing and the mutual and dependent covenants hereinafter set forth, the parties agree as follows:


 


1. Defined Terms. Capitalized
terms used and not otherwise defined herein shall have the meanings set forth in the Securities Purchase Agreement.


 


“Advice”
shall have the meaning set forth in Section 6(d).


 


“Agreement”
shall have the meaning set forth in the Preamble.


 


“CDI 612.09”
means Section 612.09 of the Commission’s Compliance and Disclosure Interpretations.


 


“Closing”
means the first closing of the purchase and sale of the Notes and Warrants pursuant to the Purchase Agreement.


 


“Commission”
means the Securities and Exchange Commission.


 


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


 


“Effectiveness Date”
means, with respect to the Initial Registration Statement required to be filed hereunder or any other Registration Statement, shall be
the fifth Trading Day following the date on which the Company is notified by the Commission that one or more of the Registration Statements
will not be reviewed or is no longer subject to further review and comments.


 


“Effectiveness Period”
shall have the meaning set forth in Section 2(a).


 


“Event”
shall have the meaning set forth in Section 2(b).


 


“Event Date”
shall have the meaning set forth in Section 2(b).


 


“Filing Date”
means, with respect to the Initial Registration Statement required hereunder, 45 calendar days following the Closing, and with respect
to any additional Registration Statements which may be required pursuant to Section 2, the earliest practical date on which the Company
is permitted by SEC Guidance to file such additional Registration Statements related to the Registrable Securities.


 


“Holder”
or “Holders” means the holder or holders, as the case may be, from time to time of Registrable Securities.


 






     


    


    

 


“Indemnified Party”
shall have the meaning set forth in Section 5(c).


 


“Indemnifying Party”
shall have the meaning set forth in Section 5(c).


 


“Initial Registration
Statement” means the initial Registration Statement filed pursuant to this Agreement.


 


“Losses”
shall have the meaning set forth in Section 5(a).


 


“Notes”
means the Note issued to the Holder, under the Purchase Agreement.


 


“Person”
means an individual, corporation, partnership, joint venture, limited liability company, governmental authority, unincorporated organization,
trust, association or other entity.


 


“Plan of Distribution”
shall have the meaning set forth in Section 2(a).


 


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


 


“Prospectus”
means the prospectus included in a Registration Statement (including, without limitation, a prospectus that includes any information previously
omitted from a prospectus filed as part of an effective registration statement in reliance upon Rule 430A promulgated by the Commission
pursuant to the Securities Act), as amended or supplemented by any prospectus supplement, with respect to the terms of the offering of
any portion of the Registrable Securities covered by a Registration Statement, and all other amendments and supplements to the Prospectus,
including post-effective amendments, and all material incorporated by reference or deemed to be incorporated by reference in such Prospectus.


 


“Purchase Agreement”
shall have the meaning set forth in the Recitals.


 


“Registrable Securities”
means (a) all of the shares of Common Stock issuable under the Note and Warrants issued pursuant to the Purchase Agreement and (b) any
securities issued or issuable upon any stock split, dividend or other distribution, recapitalization or similar event with respect to
the foregoing.


 


“Registration Statement”
means any registration statement required to be filed hereunder pursuant to Section 2(a) and any additional registration statements contemplated
by Section 3(b), including (in each case) the Prospectus, amendments and supplements to any such registration statement or Prospectus,
including pre- and post-effective amendments, all exhibits thereto, and all material incorporated by reference or deemed to be incorporated
by reference in any such registration statement.


  


“Rule 144”
means Rule 144 promulgated by the Commission pursuant to the Securities Act, as such Rule may be amended from time to time, or any similar
rule or regulation hereafter adopted by the Commission having substantially the same effect as such Rule.


 


“Rule 415”
means Rule 415 promulgated by the Commission pursuant to the Securities Act, as such Rule may be amended or interpreted from time to time,
or any similar rule or regulation hereafter adopted by the Commission having substantially the same purpose and effect as such Rule.


 


“Rule 424”
means Rule 424 promulgated by the Commission pursuant to the Securities Act, as such Rule may be amended or interpreted from time to time,
or any similar rule or regulation hereafter adopted by the Commission having substantially the same purpose and effect as such Rule.


 


“SEC Guidance”
means (i) any publicly-available written or oral guidance (including CDI 612.09), comments, requirements or requests of the Commission
staff and (ii) the Securities Act.


  


“Selling Stockholder
Questionnaire” shall have the meaning set forth in Section 3(a).


 


“Warrants”
means, collectively, the Common Stock purchase warrants delivered to the Holder in accordance with the Purchase Agreement.


  






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2. Registration.


 


(a) On or prior to the Filing
Date, the Company shall prepare and file with the Commission a Registration Statement covering the resale of all of the Registrable Securities
that are not then registered on an effective Registration Statement for an offering to be made on a continuous basis pursuant to Rule
415 in accordance with the Transaction Documents. Notwithstanding the preceding, if the Staff of
the SEC does not permit the Registration Statement to go effective as a result of the second Tranche not being funded, the Company shall
amend the Registration Statement to register only the shares of Common Stock underlying the Note and Warrant issued in connection with
the first Tranche, and the Company shall file a Registration Statement registering the shares of Common Stock underlying the Note and
Warrant issued under the second Tranche within ten (10) calendar days of the funding of the second Tranche. Each Registration Statement
filed hereunder shall be on Form S-1 and shall contain a description of the Holders planned distribution (unless otherwise directed by
at least an 75% majority in interest of the Holders) substantially in the form of “Plan of Distribution” attached hereto
as Annex A. The Company shall respond to any comments from the staff of the Commission within ten (10) Trading Days of the receipt
of such comments. In the event the amount of Registrable Securities which may be included in the Registration Statement is limited due
to SEC Guidance (provided that, the Company shall use diligent efforts to advocate with the Commission for the registration of all of
the Registrable Securities in accordance with the SEC Guidance, including without limitation, the CDI 612.09) the Company shall use its
best efforts to register such maximum portion of the Registrable Securities as permitted by SEC Guidance. Subject to the terms of this
Agreement, the Company shall use its commercially reasonable efforts to cause a Registration Statement to be declared effective under
the Securities Act as promptly as possible after the filing thereof, but in any event by the applicable Effectiveness Date, and shall
use its best efforts to keep such Registration Statement continuously effective under the Securities Act until all Registrable Securities
covered by such Registration Statement have been sold, or may be sold pursuant to Rule 144 without the volume or other limitations of
such rule, or not required to be registered in reliance upon the exemption in Section 4(a)(1) or 4(a)(7) under the Securities Act, in
either case as determined by the counsel to the Company pursuant to a written opinion letter to such effect, addressed and acceptable
to the Transfer Agent and the affected Holders (the “Effectiveness Period”). The Company shall telephonically request
effectiveness of a Registration Statement as of 5:00 p.m. New York City time on a Trading Day. The Company shall immediately notify the
Holders via facsimile or by e-mail of the effectiveness of a Registration Statement on the same Trading Day that the Company telephonically
confirms effectiveness with the Commission, which shall be the date requested for effectiveness of such Registration Statement. The Company
shall file a final Prospectus with the Commission as required by Rule 424 within three (3) Trading Days after the applicable Effectiveness
Date. Notwithstanding any other provision of this Agreement, if any SEC Guidance sets forth a limitation on the number of Registrable
Securities permitted to be registered on a particular Registration Statement (and notwithstanding that the Company used diligent efforts
to advocate with the Commission for the registration of all or a greater portion of Registrable Securities), unless otherwise directed
in writing by a Holder as to its Registrable Securities, the number of Registrable Securities to be registered on such Registration Statement
will be reduced on a pro rata basis based on the total number of unregistered Registrable Securities purchased by the Holder pursuant
to the Purchase Agreement with the Warrant Shares being cutback prior to any Conversion Shares. In the event of a cutback hereunder, the
Company shall give the Holder at least five (5) Trading Days prior written notice along with the calculations as to such Holder’s
allotment. Notwithstanding anything to the contrary in this Agreement, each Registration Statement and Prospectus shall state that Holder,
if selling the Registrable Securities pursuant to the Registration Statement, shall only sell such Registrable Securities at a fixed price
equal to the closing sale price of the Common Stock on the applicable Effectiveness Date until the Common Stock is quoted on the OTCQB
or OTCQX Market of OTC Markets, Inc., or a national securities exchange, and thereafter may be sold at prevailing market prices or privately
negotiated prices, provided, however, that if the Staff of the SEC will permit the Holder’s
resale of the Registrable Securities at prevailing market prices or privately negotiated prices while the Common Stock is quoted
on the OTC Pink Marketplace then the Company shall immediately amend the applicable Registration Statement and Prospectus to permit the
Holder’s resale in such manner.


 






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(b) If a Registration Statement
registering for resale all of the Registrable Securities (i) is not declared effective by the Commission by the Effectiveness Date of
the Initial Registration Statement or any other Registration Statement (unless the reason for such non-registration of all or any
portion of the Registrable Securities is solely as a result of (i) SEC Guidance under Rule 415 or similar rule and CDI 612.09 which limits
the number of Registrable Securities which may be included in a registration statement with respect to the Holders and/or (ii) if
the Staff of the SEC does not permit the Registration Statement to go effective as a result of the second Tranche not being funded provided
that the Company otherwise complies with Section 2(a) of this Agreement), or (ii) after the effective date of a Registration Statement,
such Registration Statement ceases for any reason to remain continuously effective as to all Registrable Securities included in such Registration
Statement, or the Holders are otherwise not permitted to utilize the Prospectus therein to resell such Registrable Securities, for more
than 30 calendar days during any 12-month period (any such failure or breach being referred to as an “Event”, and the
date on which such Event occurs, being referred to as “Event Date”), then, in addition to any other rights the Holders
may have hereunder or under applicable law, on each such Event Date and on each monthly anniversary of each such Event Date (if the applicable
Event shall not have been cured by such date) until the applicable Event is cured, the Company shall pay to each Holder an amount in cash,
as partial liquidated damages and not as a penalty, (i) on the Event Date an amount equal to 1% of the total outstanding balance of the
Note as of the Event Date and (ii) on each applicable monthly anniversary of such Event Date (if the applicable Event shall not have been
cured by such date), an amount equal to 1% of the total outstanding balance of the Note as of the applicable monthly anniversary of such
Event Date, during which such Event continues uncured. The partial liquidated damages pursuant to the terms hereof shall apply on a daily
pro rata basis for any portion of a month prior to the cure of an Event, provided, however, the foregoing liquidated damages
shall not accrue or be otherwise charged during any period in which the Investor is eligible to sell the Shares on any given day under
Rule 144 without the volume or other limitations of such rule, or in reliance upon the exemption in Section 4(a)(1) under the Securities
Act, or after such Investor has publicly sold its Registrable Securities.


 


3. Registration Procedures.


 


In connection with the Company’s
registration obligations hereunder, the Company shall:


 


(a) Not less than five Trading
Days prior to the filing of each Registration Statement and not less than one Trading Day prior to the filing of any related Prospectus
or any amendment or supplement thereto (including any document that would be incorporated or deemed to be incorporated therein by reference),
the Company shall (i) furnish to the Holders copies of all such documents proposed to be filed, which documents (other than those incorporated
or deemed to be incorporated by reference) will be subject to the review of the Holders or counsel for the Holders, and (ii) cause its
officers and directors, counsel and independent registered public accountants to respond to such inquiries as shall be necessary to conduct
a reasonable investigation within the meaning of the Securities Act. The Company shall not file a Registration Statement or any such Prospectus
or any amendments or supplements thereto to which the Holders of a majority of the Registrable Securities shall reasonably object in good
faith, provided that, the Company is notified of such objection in writing no later than three (3) Trading Days after the Holders have
been so furnished copies of a Registration Statement or two (2) Trading Days after the Holders have been so furnished copies of any related
Prospectus or amendments or supplements thereto. Each Holder agrees to furnish to the Company a completed questionnaire in the form attached
to this Agreement as Annex B (a “Selling Stockholder Questionnaire”) on a date that is not less than two Trading
Days prior to the Filing Date or by the end of the third Trading Day following the date on which such Holder receives draft materials
in accordance with this Section.


 


(b) (i) prepare and file with
the Commission such amendments, including post-effective amendments, to a Registration Statement and the Prospectus used in connection
therewith as may be necessary to keep a Registration Statement continuously effective as to the applicable Registrable Securities for
the Effectiveness Period and prepare and file with the Commission such additional Registration Statements in order to register for resale
under the Securities Act all of the Registrable Securities,


 


(ii) cause the related Prospectus
to be amended or supplemented by any required Prospectus supplement (subject to the terms of this Agreement), and, as so supplemented
or amended, to be filed pursuant to Rule 424,


 


(iii) respond to any comments
received from the Commission with respect to a Registration Statement or any amendment thereto within ten (10) Trading Days of the receipt
of such comments, and provide as promptly as reasonably possible to the Holders true and complete copies of all correspondence from and
to the Commission relating to a Registration Statement (provided that, the Company may excise any information contained therein which
would constitute material non-public information as to any Holder which has not executed a confidentiality agreement with the Company),
and


 






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(iv) comply with the provisions
of the Securities Act and the Exchange Act with respect to the disposition of all Registrable Securities covered by a Registration Statement
during the applicable period in accordance (subject to the terms of this Agreement) with the intended methods of disposition by the Holders
thereof set forth in such Registration Statement as so amended or in such Prospectus as so supplemented.


  


(c) Notify the Holders of Registrable
Securities to be sold (which notice shall, pursuant to clauses (iii) through (vi) hereof, be accompanied by an instruction to suspend
the use of the Prospectus until the requisite changes have been made) as promptly as reasonably possible (and, in the case of (i)(A) below,
not less than one Trading Day prior to such filing) and (if requested by any such Person) confirm such notice in writing no later than
one Trading Day following the day (i)(A) when a Prospectus or any Prospectus supplement or post-effective amendment to a Registration
Statement is proposed to be filed, (B) when the Commission notifies the Company whether there will be a “review” of such Registration
Statement and whenever the Commission comments in writing on such Registration Statement, and (C) with respect to a Registration Statement
or any post-effective amendment, when the same has become effective, (ii) of any request by the Commission or any other federal or state
governmental authority for amendments or supplements to a Registration Statement or Prospectus or for additional information, (iii) of
the issuance by the Commission or any other federal or state governmental authority of any stop order suspending the effectiveness of
a Registration Statement covering any or all of the Registrable Securities or the initiation of any Proceedings for that purpose; (iv)
of the receipt by the Company of any notification with respect to the suspension of the qualification or exemption from qualification
of any of the Registrable Securities for sale in any jurisdiction, or the initiation or threatening of any Proceeding for such purpose,
(v) of the occurrence of any event or passage of time that makes the financial statements included in a Registration Statement ineligible
for inclusion therein or any statement made in a Registration Statement or Prospectus or any document incorporated or deemed to be incorporated
therein by reference untrue in any material respect or that requires any revisions to a Registration Statement, Prospectus or other documents
so that, in the case of a Registration Statement or the Prospectus, as the case may be, it will not contain 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 and (vi) of the occurrence or existence of any pending corporate development
with respect to the Company that the Company believes may be material and that, in the determination of the Company, makes it not in the
best interest of the Company to allow continued availability of a Registration Statement or Prospectus, provided that, any and all of
such information shall remain confidential to each Holder until such information otherwise becomes public, unless disclosure by a Holder
is required by law; provided, further, that notwithstanding each Holder’s acknowledgement to keep such information
confidential, each such Holder makes no acknowledgement that any such information is material, non-public information.


 


(d) Use its best efforts to
avoid the issuance of, or, if issued, obtain the withdrawal of (i) any order stopping or suspending the effectiveness of a Registration
Statement, or (ii) any suspension of the qualification (or exemption from qualification) of any of the Registrable Securities for sale
in any jurisdiction, at the earliest practicable moment.


 


(e) Furnish to each Holder,
without charge, at least one conformed copy of each such Registration Statement and each amendment thereto, including financial statements
and schedules, all documents incorporated or deemed to be incorporated therein by reference to the extent requested by such Person, and
all exhibits to the extent requested by such Person (including those previously furnished or incorporated by reference) promptly after
the filing of such documents with the Commission; provided, that any such item which is available on the EDGAR system need not be furnished
in physical form, and such number of copies of the current Prospectus as each Holder may reasonably request.


 


(f) Subject to the terms of
this Agreement, the Company hereby consents to the use of such Prospectus and each amendment or supplement thereto by each of the selling
Holders in connection with the offering and sale of the Registrable Securities covered by such Prospectus and any amendment or supplement
thereto, except after the giving of any notice pursuant to Section 6(f).


 


(g) The Company shall cooperate
with any broker-dealer through which a Holder proposes to resell its Registrable Securities in effecting a filing with the FINRA Corporate
Financing Department pursuant to FINRA Rule 5110 and 5190 and NASD Rule 2710, as requested by any such Holder, and the Company shall pay
the filing fee required by such filing within two Trading Days of request therefor.


 






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(h) Prior to any resale of Registrable
Securities by a Holder, use its commercially reasonable efforts to register or qualify or cooperate with the selling Holders in connection
with the registration or qualification (or exemption from the Registration or qualification) of such Registrable Securities for the resale
by the Holder under the securities or Blue Sky laws of such jurisdictions within the United States as any Holder reasonably requests in
writing, to keep each registration or qualification (or exemption therefrom) effective during the Effectiveness Period and to do any and
all other acts or things reasonably necessary to enable the disposition in such jurisdictions of the Registrable Securities covered by
each Registration Statement; provided, that, the Company shall not be required to qualify generally to do business in any jurisdiction
where it is not then so qualified, subject the Company to any material tax in any such jurisdiction where it is not then so subject or
file a general consent to service of process in any such jurisdiction.


 


(i) If requested by a Holder,
cooperate with such Holders to facilitate the timely preparation and delivery of certificates representing Registrable Securities to be
delivered to a transferee pursuant to a Registration Statement, which certificates shall be free, to the extent permitted by the Purchase
Agreement, of all restrictive legends, and to enable such Registrable Securities to be in such denominations and registered in such names
as any such Holder may request.


 


(j) If the Company notifies
the Holders in accordance with clauses (iii) through (vi) of Section 3(c) above to suspend the use of any Prospectus until the requisite
changes to such Prospectus have been made, then the Holders shall suspend use of such Prospectus. The Company will use its best efforts
to ensure that the use of the Prospectus may be resumed as promptly as is practicable.


 


(k) Comply with all applicable
rules and regulations of the Commission.


 


(l) The Company may require
each selling Holder to furnish to the Company a certified statement as to the number of shares of Common Stock beneficially owned by such
Holder and, if required by the Commission, the natural persons thereof that have voting and dispositive control over the shares. The Company
shall not be liable for any damages during any periods that the Company is unable to meet its obligations hereunder with respect to the
registration of the Registrable Securities solely because any Holder fails to furnish such information within three Trading Days of the
Company’s request.


  


4. Registration Expenses.
All fees and expenses incident to the performance of or compliance with this Agreement by the Company shall be borne by the Company whether
or not any Registrable Securities are sold pursuant to a Registration Statement. The fees and expenses referred to in the foregoing sentence
shall include, without limitation, (i) all registration and filing fees (including, without limitation, fees and expenses of the Company’s
counsel, independent registered public accountants and transfer agent) (A) with respect to filings made with the Commission, (B) with
respect to filings required to be made with any Trading Market on which the Common Stock is then listed for trading, (C) in compliance
with applicable state securities or Blue Sky laws reasonably agreed to by the Company in writing (including, without limitation, fees
and disbursements of counsel for the Company in connection with Blue Sky qualifications or exemptions of the Registrable Securities) and
(D) if not previously paid by the Company in connection with an issuer filing, with respect to any filing that may be required to be made
by any broker-dealer through which a Holder intends to make sales of Registrable Securities pursuant to FINRA Rule 5110 and 5190 and NASD
Rule 2710, so long as the broker-dealer is receiving no more than a customary brokerage commission in connection with such sale, (ii)
printing expenses (including, without limitation, expenses of printing certificates for Registrable Securities), and (iii) messenger,
telephone and delivery expenses, (iv) fees and disbursements of counsel for the Company. In addition, the Company shall be responsible
for all of its internal expenses incurred in connection with the consummation of the transactions contemplated by this Agreement (including,
without limitation, all salaries and expenses of its officers and employees performing legal or accounting duties), the expense of any
annual audit and the fees and expenses incurred in connection with the listing of the Registrable Securities on any Trading Market as
required hereunder. In no event shall the Company be responsible for any broker-dealer or similar commissions of any Holder or, except
to the extent provided for in the Transaction Documents, any legal fees or other costs of the Holders.


 






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5. Indemnification.


 


(a) Indemnification by the
Company. The Company shall, notwithstanding any termination of this Agreement, indemnify and hold harmless each Holder, the officers,
directors, members, partners, agents and employees (and any other Persons with a functionally equivalent role of a Person holding such
titles, notwithstanding a lack of such title or any other title) of each of them, each Person who controls any such Holder (within the
meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act) and the officers, directors, members, stockholders, partners,
agents and employees (and any other Persons with a functionally equivalent role of a Person holding such titles, notwithstanding a lack
of such title or any other title) of each such controlling Person, to the fullest extent permitted by applicable law, from and against
any and all losses, claims, damages, liabilities, costs (including, without limitation, reasonable attorneys’ fees and costs of
investigation and preparation) and expenses (collectively, “Losses”), as incurred, arising out of or relating to (1)
any untrue or alleged untrue statement of a material fact contained in a Registration Statement, any Prospectus or any form of prospectus
or in any amendment or supplement thereto or in any preliminary prospectus, or arising out of or relating to any omission or alleged omission
of a material fact required to be stated therein or necessary to make the statements therein (in the case of any Prospectus or supplement
thereto, in light of the circumstances under which they were made) not misleading or (2) any violation or alleged violation by the Company
of the Securities Act, the Exchange Act or any state securities law, or any rule or regulation thereunder, in connection with the performance
of its obligations under this Agreement, except to the extent that (i) such untrue statements or omissions are based solely upon information
regarding such Holder furnished in writing to the Company by such Holder expressly for use therein, or to the extent that such information
relates to such Holder or such Holder’s proposed method of distribution of Registrable Securities and was reviewed and expressly
approved in writing by such Holder expressly for use in a Registration Statement, such Prospectus or in any amendment or supplement thereto
(it being understood that the Holder has approved Annex A hereto for this purpose) or (ii) in the case of an occurrence of an event of
the type specified in Section 3(c)(iii)-(vi), the use by such Holder of an outdated or defective Prospectus after the Company has notified
such Holder in writing that the Prospectus is outdated or defective and prior to the receipt by such Holder of the Advice contemplated
in Section 6(d). The Company shall notify the Holders promptly of the institution, threat or assertion of any Proceeding arising from
or in connection with the transactions contemplated by this Agreement of which the Company is aware.


 


(b) Indemnification by Holders.
Each Holder shall, severally and not jointly, indemnify and hold harmless the Company, each director of the Company, each officer of the
Company who shall sign such Registration Statement, each underwriter, broker or other Person acting on behalf of the holders of Registrable
Securities and each Person who controls any of the foregoing Persons within the meaning of Section 15 of the Securities Act or Section
20 of the Exchange Act, to the fullest extent permitted by applicable law, from and against all Losses, as incurred, to the extent arising
out of or based solely upon: (x) such Holder’s failure to comply with the prospectus delivery requirements of the Securities Act
or (y) any untrue or alleged untrue statement of a material fact contained in any Registration Statement, any Prospectus, or in any amendment
or supplement thereto or in any preliminary prospectus, or arising out of or relating to any omission or alleged omission of a material
fact required to be stated therein or necessary to make the statements therein not misleading (i) to the extent, but only to the extent,
that such untrue statement or omission is contained in any information so furnished in writing by such Holder to the Company specifically
for inclusion in such Registration Statement or such Prospectus or (ii) to the extent that such information relates to such Holder’s
proposed method of distribution of Registrable Securities and was reviewed and expressly approved in writing by such Holder expressly
for use in a Registration Statement (it being understood that the Holder has approved Annex A hereto for this purpose), such Prospectus
or in any amendment or supplement thereto or (ii) in the case of an occurrence of an event of the type specified in Section 3(c)(iii)-(vi),
the use by such Holder of an outdated or defective Prospectus after the Company has notified such Holder in writing that the Prospectus
is outdated or defective and prior to the receipt by such Holder of the Advice contemplated in Section 6(d). In no event shall the liability
of any selling Holder hereunder be greater in amount than the dollar amount of the net proceeds (after underwriting fees, commissions,
or discounts) actually received by such Holder upon the sale of the Registrable Securities giving rise to such indemnification obligation.


 


(c) Conduct of Indemnification
Proceedings. If any Proceeding shall be brought or asserted against any Person entitled to indemnity hereunder (an “Indemnified
Party”), such Indemnified Party shall promptly notify the Person from whom indemnity is sought (the “Indemnifying Party”)
in writing, and the Indemnifying Party shall have the right to assume the defense thereof, including the employment of one law firm reasonably
satisfactory to the Indemnified Party and the payment of all fees and expenses incurred in connection with defense thereof except as otherwise
provided in this Section 5(c); provided, that, the failure of any Indemnified Party to give such notice shall not relieve the Indemnifying
Party of its obligations or liabilities pursuant to this Agreement, except (and only) to the extent that it shall be finally determined
by a court of competent jurisdiction (which determination is not subject to appeal or further review) that such failure shall have materially
prejudiced the Indemnifying Party.


 






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An Indemnified Party shall
have the right to employ separate counsel in any such Proceeding and to participate in the defense thereof, but the fees and expenses
of such counsel shall be at the expense of such Indemnified Party or Parties unless: (1) the Indemnifying Party has agreed in writing
to pay such fees and expenses, (2) the Indemnifying Party shall have failed promptly to assume the defense of such Proceeding and to employ
counsel reasonably satisfactory to such Indemnified Party in any such Proceeding, or (3) the named parties to any such Proceeding (including
any impleaded parties) include both such Indemnified Party and the Indemnifying Party, and counsel to the Indemnifying Party shall reasonably
believe that a material conflict of interest is likely to exist if the same counsel were to represent such Indemnified Party and the Indemnifying
Party (in which case, if such Indemnified Party notifies the Indemnifying Party in writing that it elects to employ separate counsel at
the expense of the Indemnifying Party, the Indemnifying Party shall not have the right to assume the defense thereof and the reasonable
fees and expenses of no more than one separate counsel shall be at the expense of the Indemnifying Party). The Indemnifying Party shall
not be liable for any settlement of any such Proceeding effected without its written consent, which consent shall not be unreasonably
withheld or delayed. No Indemnifying Party shall, without the prior written consent of the Indemnified Party, effect any settlement of
any pending Proceeding in respect of which any Indemnified Party is a party, unless such settlement includes an unconditional release
of such Indemnified Party from all liability on claims that are the subject matter of such Proceeding.


 


Subject to the terms of this
Agreement, all reasonable fees and expenses of the Indemnified Party (including reasonable fees and expenses to the extent incurred in
connection with investigating or preparing to defend such Proceeding in a manner not inconsistent with this Section) shall be paid to
the Indemnified Party, as incurred, within ten Trading Days of written notice thereof to the Indemnifying Party; provided, that, the Indemnified
Party shall promptly reimburse the Indemnifying Party for that portion of such fees and expenses applicable to such actions for which
such Indemnified Party is judicially determined not to be entitled to indemnification hereunder.


 


(d) Contribution. If
the indemnification under Section 5(a) or 5(b) is unavailable to an Indemnified Party or insufficient to hold an Indemnified Party harmless
for any Losses, then each Indemnifying Party shall contribute to the amount paid or payable by such Indemnified Party, in such proportion
as is appropriate to reflect the relative fault of the Indemnifying Party and Indemnified Party in connection with the actions, statements
or omissions that resulted in such Losses as well as any other relevant equitable considerations. The relative fault of such Indemnifying
Party and Indemnified Party shall be determined by reference to, among other things, whether any action in question, including any untrue
or alleged untrue statement of a material fact or omission or alleged omission of a material fact, has been taken or made by, or relates
to information supplied by, such Indemnifying Party or Indemnified Party, and the parties’ relative intent, knowledge, access to
information and opportunity to correct or prevent such action, statement or omission. The amount paid or payable by a party as a result
of any Losses shall be deemed to include, subject to the limitations set forth in this Agreement, any reasonable attorneys’ or other
fees or expenses incurred by such party in connection with any Proceeding to the extent such party would have been indemnified for such
fees or expenses if the indemnification provided for in this Section was available to such party in accordance with its terms.


 


The parties hereto agree that
it would not be just and equitable if contribution pursuant to this Section 5(d) were determined by pro rata allocation or by any other
method of allocation that does not take into account the equitable considerations referred to in the immediately preceding paragraph.
Notwithstanding the provisions of this Section 5(d), no Holder shall be required to contribute, in the aggregate, any amount in excess
of the amount by which the net proceeds actually received by such Holder from the sale of the Registrable Securities subject to the Proceeding
exceeds the amount of any damages that such Holder has otherwise been required to pay by reason of such untrue or alleged untrue statement
or omission or alleged omission.


 


The indemnity and contribution
agreements contained in this Section are in addition to any liability that the Indemnifying Parties may have to the Indemnified Parties.


 






    8 


    


    

 


6. Miscellaneous.


 


(a) Remedies. In the
event of a breach by the Company or by a Holder of any of their respective obligations under this Agreement, each Holder or the Company,
as the case may be, in addition to being entitled to exercise all rights granted by law and under this Agreement, including recovery of
damages, shall be entitled to specific performance of its rights under this Agreement. The Company and each Holder agree that monetary
damages would not provide adequate compensation for any Losses incurred by reason of a breach by it of any of the provisions of this Agreement
and hereby further agrees that, in the event of any action for specific performance in respect of such breach, it shall not assert or
shall waive the defense that a remedy at law would be adequate.


 


(b) Prohibition on Filing
Other Registration Statements Neither the Company nor any of its security holders (other than the Holders in such capacity pursuant
hereto) may include securities of the Company in any Registration Statements filed pursuant to this Agreement other than the Registrable
Securities. The Company shall not file any other registration statements until all Registrable Securities are registered pursuant to a
Registration Statement that is declared effective by the Commission, provided that this Section 6(b) shall not prohibit the Company from
filing amendments to registration statements filed prior to the date of this Agreement. In the event that, under SEC Guidance, there is
a limitation on the number of Registrable Securities that may be included in a Registration Statement, securities of the Company that
have been registered on an effective registration statement of the Company as of the date of this Agreement shall be registered prior
to any of the Registrable Securities. Thereafter, the Holders shall have priority over any other security holders with outstanding registration
rights until all Registrable Securities are registered pursuant to a Registration Statement that is declared effective by the Commission.
Any reduction pursuant to this Section 6(b) in the number of Registrable Securities registered shall be done on a pro rata basis in accordance
with the Holders’ investment made pursuant to the Purchase Agreement.


  


(c) Compliance. Each
Holder covenants and agrees that it will comply with the prospectus delivery requirements of the Securities Act as applicable to it in
connection with sales of Registrable Securities pursuant to a Registration Statement.


 


(d) Discontinued Disposition.
By its acquisition of Registrable Securities, each Holder agrees that, upon receipt of a notice from the Company of the occurrence of
any event of the kind described in Section 3(c)(iii) through (vi), such Holder will immediately discontinue disposition of such Registrable
Securities under a Registration Statement until it is advised in writing (the “Advice”) by the Company that the use
of the applicable Prospectus (as it may have been supplemented or amended) may be resumed. The Company will use its best efforts to ensure
that the use of the Prospectus may be resumed as promptly as is practicable.


 


(e) Amendments and Waivers.
The provisions of this Agreement, including the provisions of this sentence, may not be amended, modified or supplemented, and waivers
or consents to departures from the provisions hereof may not be given, unless the same shall be in writing and signed by the Company and
the Holders of more than 50% of the Registrable Securities. If a Registration Statement does not register all of the Registrable Securities
pursuant to a waiver or amendment done in compliance with the previous sentence, then the number of Registrable Securities to be registered
for each Holder shall be reduced pro rata among all Holders and each Holder shall have the right to designate which of its Registrable
Securities shall be omitted from such Registration Statement. Notwithstanding the foregoing, a waiver or consent to depart from the provisions
hereof with respect to a matter that relates exclusively to the rights of a Holder or some Holders and that does not directly or indirectly
affect the rights of other Holders may be given by such Holder or Holders of all of the Registrable Securities to which such waiver or
consent relates; provided, however, that the provisions of this sentence may not be amended, modified, or supplemented except
in accordance with the provisions of the first sentence of this Section 6(e).


 


(f) Notices. Any and
all notices or other communications or deliveries required or permitted to be provided hereunder shall be delivered as set forth in the
Purchase Agreement.


 


(g) Successors and Assigns.
This Agreement shall inure to the benefit of and be binding upon the successors and permitted assigns of each of the parties and shall
inure to the benefit of each Holder. The Company may not assign (except by merger) its rights or obligations hereunder without the prior
written consent of all of the Holders of the then outstanding Registrable Securities. Each Holder may assign their respective rights hereunder
in the manner and to the Persons as permitted under the Purchase Agreement.


 






    9 


    


    

 


(h) No Inconsistent Agreements.
Neither the Company nor any of its Subsidiaries has entered, as of the date hereof, nor shall the Company or any of its Subsidiaries,
on or after the date of this Agreement, enter into any agreement with respect to its securities, that would have the effect of impairing
the rights granted to the Holders in this Agreement or otherwise conflicts with the provisions hereof. Neither the Company nor any of
its Subsidiaries has previously entered into any agreement granting any registration rights with respect to any of its securities to any
Person that have not been satisfied in full.


 


(i) Execution and Counterparts.
This Agreement 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.


 


(j) Governing Law; Venue.
All questions concerning the choice of law and venue, construction, validity, enforcement and interpretation of this Agreement shall be
determined in accordance with the provisions of the Purchase Agreement.


 


(k) Cumulative Remedies.
The remedies provided herein are cumulative and not exclusive of any other remedies provided by law.


 


(l) Severability. If
any term, provision, covenant or restriction of this Agreement is held by a court of competent jurisdiction to be invalid, illegal, void
or unenforceable, the remainder of the terms, provisions, covenants and restrictions set forth herein shall remain in full force and effect
and shall in no way be affected, impaired or invalidated, and the parties hereto shall use their commercially reasonable efforts to find
and employ an alternative means to achieve the same or substantially the same result as that contemplated by such term, provision, covenant
or restriction. It is hereby stipulated and declared to be the intention of the parties that they would have executed the remaining terms,
provisions, covenants and restrictions without including any of such that may be hereafter declared invalid, illegal, void or unenforceable.


 


(m) Headings. The headings
in this Agreement are for convenience only, do not constitute a part of the Agreement and shall not be deemed to limit or affect any of
the provisions hereof.


 


(n) Independent Nature of
Holders’ Obligations and Rights. The obligations of each Holder hereunder are several and not joint with the obligations of
any other Holder hereunder, and no Holder shall be responsible in any way for the performance of the obligations of any other Holder hereunder.
Nothing contained herein or in any other agreement or document delivered at any closing, and no action taken by any Holder pursuant hereto
or thereto, shall be deemed to constitute the Holders as a partnership, an association, a joint venture or any other kind of entity, or
create a presumption that the Holders are in any way acting in concert with respect to such obligations or the transactions contemplated
by this Agreement. Each Holder shall be entitled to protect and enforce its rights, including without limitation the rights arising out
of this Agreement, and it shall not be necessary for any other Holder to be joined as an additional party in any proceeding for such purpose.


 


[Signature Pages Follow]


 






    10 


    


    

 


IN WITNESS WHEREOF, the parties
have executed this Registration Rights Agreement as of the date first written above.


 


	 	C-BOND SYSTEMS, INC.
	 	 	
    

	 	By: 	 /s/ Scott R. Silverman
	 	 	Name:  	 Scott R. Silverman
	 	 	Title: 	Chief Executive Officer


  


[Signature Page to Registration Rights Agreement]


 









    11 


    


    

 


Name of Holder: Mercer Street Global Opportunity Fund, LLC


 


Signature of Authorized Signatory of Holder: /s/ Jonathan Juchno


  


Name of Authorized Signatory: Jonathan Juchno


  


Title of Authorized Signatory: Managing Member


 


[Signature Page to Registration Rights Agreement]


 


 



 






    12 


    


    

 


Annex A


 


Plan of Distribution


 


Each Selling Stockholder (the
“Selling Stockholders”) of the Common Stock and any of their pledgees, assignees and successors-in-interest may, from
time to time, sell any or all of their shares of Common Stock on the OTC Markets or any other stock exchange, market or trading facility
on which the shares are traded or in private transactions. These sales shall be at a fixed price equal to the closing sale price of the
Common Stock on the effectiveness date of this registration statement until the Common Stock is quoted on the OTCQB or OTCQX Market of
OTC Markets, Inc., or a national securities exchange, and thereafter may be sold at prevailing market prices or privately negotiated prices.
A Selling Stockholder may use any one or more of the following methods when selling shares:


 


	 	☐	ordinary
    brokerage transactions and transactions in which the broker-dealer solicits purchasers;


 


	 	☐	block
    trades in which the broker-dealer will attempt to sell the shares as agent but may position and resell a portion of the block as
    principal to facilitate the transaction;


 


	 	☐	purchases
    by a broker-dealer as principal and resale by the broker-dealer for its account;


 


	 	☐	an
    exchange distribution in accordance with the rules of the applicable exchange;


 


	 	☐	privately
    negotiated transactions;


 


	 	☐	settlement
    of short sales entered into after the effective date of the registration statement of which this prospectus is a part;


 


	 	☐	broker-dealers
    may agree with the Selling Stockholders to sell a specified number of such shares at a stipulated price per share;


 


	 	☐	through
    the writing or settlement of options or other hedging transactions, whether through an options exchange or otherwise;


 


	 	☐	a
    combination of any such methods of sale; or


 


	 	☐	any
    other method permitted pursuant to applicable law.


 


The Selling Stockholders may
also sell shares under Rule 144 under the Securities Act of 1933, as amended (the “Securities Act”), if available,
rather than under this prospectus.


 


Broker-dealers engaged by
the Selling Stockholders may arrange for other brokers or dealers to participate in sales. Broker-dealers may receive commissions or discounts
from the Selling Stockholders (or, if any broker-dealer acts as agent for the purchaser of shares, from the purchaser) in amounts to be
negotiated, but, except as set forth in a supplement to this Prospectus, in the case of an agency transaction not in excess of a customary
brokerage commission in compliance with FINRA Rule 2121 or NASD Rule 2440; and in the case of a principal transaction a markup or markdown
in compliance with NASD IM-2440.


 


In connection with the sale
of the Common Stock or interests therein, the Selling Stockholders may enter into hedging transactions with broker-dealers or other financial
institutions, which may in turn engage in short sales of the Common Stock in the course of hedging the positions they assume. The Selling
Stockholders may also sell shares of the Common Stock short and deliver these securities to close out their short positions, or loan or
pledge the Common Stock to broker-dealers that in turn may sell these securities. The Selling Stockholders may also enter into option
or other transactions with broker-dealers or other financial institutions or the creation of one or more derivative securities which require
the delivery to such broker-dealer or other financial institution of shares offered by this prospectus, which shares such broker-dealer
or other financial institution may resell pursuant to this prospectus (as supplemented or amended to reflect such transaction).


 






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The Selling Stockholders and
any broker-dealers or agents that are involved in selling the shares may be deemed to be “underwriters” within the meaning
of the Securities Act in connection with such sales. In such event, any commissions received by such broker-dealers or agents and any
profit on the resale of the shares purchased by them may be deemed to be underwriting commissions or discounts under the Securities Act.
Each Selling Stockholder has informed the Company that it does not have any written or oral agreement or understanding, directly or indirectly,
with any person to distribute the Common Stock. In no event shall any broker-dealer receive fees, commissions and markups which, in the
aggregate, would exceed eight percent.


 


The Company is required to
pay certain fees and expenses incurred by the Company incident to the registration of the shares. The Company has agreed to indemnify
the Selling Stockholders against certain losses, claims, damages and liabilities, including liabilities under the Securities Act.


 


Because Selling Stockholders
may be deemed to be “underwriters” within the meaning of the Securities Act, they will be subject to the prospectus delivery
requirements of the Securities Act including Rule 172 thereunder. In addition, any securities covered by this prospectus which qualify
for sale pursuant to Rule 144 under the Securities Act may be sold under Rule 144 rather than under this prospectus. There is no underwriter
or coordinating broker acting in connection with the proposed sale of the resale shares by the Selling Stockholders.


 


The shares will be sold only
through registered or licensed brokers or dealers if required under applicable state securities laws. In addition, in certain states,
the shares may not be sold unless they have been registered or qualified for sale in the applicable state or an exemption from the registration
or qualification requirement is available and is complied with.


 


Under applicable rules and
regulations under the Exchange Act, any person engaged in the distribution of the shares may not simultaneously engage in market making
activities with respect to the Common Stock for the applicable restricted period, as defined in Regulation M, prior to the commencement
of the distribution. In addition, the Selling Stockholders will be subject to applicable provisions of the Exchange Act and the rules
and regulations thereunder, including Regulation M, which may limit the timing of purchases and sales of shares of the Common Stock by
the Selling Stockholders or any other person. We will make copies of this prospectus available to the Selling Stockholders and have informed
them of the need to deliver a copy of this prospectus to each purchaser at or prior to the time of the sale (including by compliance with
Rule 172 under the Securities Act).


 






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Annex B


 


Selling Stockholder Notice and Questionnaire


 


The undersigned beneficial
owner of Common Stock (the “Registrable Securities”) of C-BOND SYSTEMS, INC., a Colorado corporation (the “Company”),
understands that the Company has filed or intends to file with the Securities and Exchange Commission (the “Commission”)
a registration statement (the “Registration Statement”) for the registration and resale under Rule 415 of the Securities
Act of 1933, as amended (the “Securities Act”), of the Registrable Securities, in accordance with the terms of the
Registration Rights Agreement (the “Registration Rights Agreement”) to which this document is annexed. A copy of the
Registration Rights Agreement is available from the Company upon request at the address set forth below. All capitalized terms not otherwise
defined herein shall have the meanings ascribed thereto in the Registration Rights Agreement.


 


Certain legal consequences
arise from being named as a selling stockholder in the Registration Statement and the related prospectus. Accordingly, holders and beneficial
owners of Registrable Securities are advised to consult their own securities law counsel regarding the consequences of being named or
not being named as a selling stockholder in the Registration Statement and the related prospectus.


 


NOTICE


 


The undersigned beneficial
owner (the “Selling Stockholder”) of Registrable Securities hereby elects to include the Registrable Securities owned
by it in the Registration Statement.


 


The undersigned hereby provides the following
information to the Company and represents and warrants that such information is accurate:


 


QUESTIONNAIRE


 


		1.	Name.


 


	 	(a)	Full Legal Name of Selling Stockholder
	 	 	 
	 	 	 
	 	(b)	Full Legal Name of Registered Holder (if not the same as (a) above) through which Registrable Securities are held:
	 	 	 
	 	 	 
	 	(c)	Full Legal Name of Natural Control Person (which means a natural person who directly or indirectly alone or with others has power to vote or dispose of the securities covered by this Questionnaire):
	 	 	 


 


		2.	Address for Notices to Selling Stockholder:


 


 



 


 



 







 



 


Telephone:


_____________________________________________________________________________________


____________________________________________________________________________________


 


Contact Person:


___________________________________________________________________________________


 






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		3.	Broker-Dealer Status:


 


	 	(a)	Are you a broker-dealer?


 


Yes ☐
      No ☐


 


	 	(b)	If “yes” to Section 3(a), did you receive your Registrable Securities as compensation for investment banking services to the Company?


 


Yes ☐
      No ☐


 


	 	Note:	If “no” to Section 3(b), the Commission’s staff has indicated that you should be identified as an underwriter in the Registration Statement.


 


	 	(c)	Are you an affiliate of a broker-dealer?


 


Yes ☐
      No ☐


 


	 	(d)	If you are an affiliate of a broker-dealer, do you certify that you purchased the Registrable Securities in the ordinary course of business, and at the time of the purchase of the Registrable Securities to be resold, you had no agreements or understandings, directly or indirectly, with any person to distribute the Registrable Securities?


 


Yes ☐
      No ☐


 


	 	Note:	If “no” to Section 3(d), the Commission’s staff has indicated that you should be identified as an underwriter in the Registration Statement.


 


		4.	Beneficial Ownership of Securities of the Company Owned by the Selling Stockholder.


 


Except as set forth below in this
Item 4, the undersigned is not the beneficial or registered owner of any securities of the Company other than the securities issuable
pursuant to the Purchase Agreement.


 


	 	(a)	Type and Amount of other securities beneficially owned by the Selling Stockholder:
	 	 	 
	 	 	 


 


		5.	Relationships with the Company:


 


Except as set forth below, neither
the undersigned nor any of its affiliates, officers, directors or principal equity holders (owners of 5% of more of the equity securities
of the undersigned) has held any position or office or has had any other material relationship with the Company (or its predecessors or
affiliates) during the past three years.


 


State any exceptions here:


 


 



 


 



 


The undersigned agrees to
promptly notify the Company of any inaccuracies or changes in the information provided herein that may occur subsequent to the date hereof
at any time while the Registration Statement remains effective.


 


By signing below, the undersigned
consents to the disclosure of the information contained herein in its answers to Items 1 through 5 and the inclusion of such information
in the Registration Statement and the related prospectus and any amendments or supplements thereto. The undersigned understands that such
information will be relied upon by the Company in connection with the preparation or amendment of the Registration Statement and the related
prospectus.


 






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IN WITNESS WHEREOF the undersigned,
by authority duly given, has caused this Notice and Questionnaire to be executed and delivered either in person or by its duly authorized
agent.


 


	Date:	 	 	Beneficial Owner:	 


 


	 	By:	
	 	 	Name:	 
	 	 	Title:	 


 


PLEASE EMAIL A COPY OF THE COMPLETED AND EXECUTED
NOTICE AND QUESTIONNAIRE TO:


 


 


 


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