Exhibit 10.1


 


SECURITIES PURCHASE AGREEMENT


 


This Securities Purchase
Agreement (this “Agreement”) is dated as of October 10, 2022, between Knightscope, Inc. a Delaware corporation (the
“Company”), and each purchaser identified on the signature pages hereto (each, including its successors and assigns,
a “Buyer” and collectively, the “Buyers”).


 


WHEREAS, subject to the terms
and conditions set forth in this Agreement and pursuant to Section 4(a)(2) of the Securities Act (as defined below), and Rule 506 promulgated
thereunder, the Company desires to issue and sell to each Buyer, and each Buyer, severally and not jointly, desires to purchase from
the Company, securities of the Company as more fully described in this Agreement.


 


NOW, THEREFORE, IN CONSIDERATION
of the mutual covenants contained in this Agreement, and for other good and valuable consideration, the receipt and adequacy of which
are hereby acknowledged, the Company and each Buyer agree as follows:


 


ARTICLE I. 


DEFINITIONS


 


1.1             
Definitions. In addition to the terms defined elsewhere in this Agreement: (a) capitalized terms that are not otherwise
defined herein have the meanings given to such terms in the Notes (as defined herein), and (b) the following terms have the meanings
set forth in this Section 1.1:


 


“Acquiring
Person” shall have the meaning ascribed to such term in Section 4.7.


 


“Action”
shall have the meaning ascribed to such term in Section 3.1(j).


 


“Affiliate”
means any Person that, directly or indirectly through one or more intermediaries, controls or is controlled by or is under common control
with a Person, as such terms are used in and construed under Rule 405 under the Securities Act.


 


“Board
of Directors” means the board of directors of the Company.


 


“BR Waiver”
means that certain waiver of B. Riley Financial, Inc. in the form attached hereto as Exhibit D.


 


“Business
Day” means any day other than Saturday, Sunday or other day on which commercial banks in The City of New York are authorized
or required by law to remain closed; provided, however, for clarification, commercial banks shall not be deemed to be authorized
or required by law to remain closed due to “stay at home”, “shelter-in-place”, “non-essential employee” 
or any other similar orders or restrictions or the closure of any physical branch locations at the direction of any governmental authority
so long as the electronic funds transfer systems (including for wire transfers) of commercial banks in The City of New York are generally
open for use by customers on such day.


 


“Buyer
Party” shall have the meaning ascribed to such term in Section 4.10.


 




     


     


    

 


“Closing”
means the closing of the purchase and sale of the Securities pursuant to Section 2.1.


 


“Closing
Date” means the Trading Day on which all of the Transaction Documents have been executed and delivered by the applicable parties
thereto, and all conditions precedent to (i) the Buyers’ obligations to pay the Subscription Amount and (ii) the Company’s
obligations to deliver the Securities, in each case, have been satisfied or waived.


 


“Commission”
means the United States Securities and Exchange Commission.


 


“Common
Stock” means the Class A common stock of the Company, par value $0.001 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.


 


“Company
Counsel” means Perkins Coie LLP, with offices located at 505 Howard Street, Suite 1000, San Francisco, California 94105.


 


“Conversion
Price” shall have the meaning ascribed to such term in the Notes.


 


“Conversion
Shares” shall have the meaning ascribed to such term in the Notes.


 


“Disclosure
Schedules” shall have the meaning ascribed to such term in Section 3.1.


 


“Disclosure
Time” means, (i) if this Agreement is signed on a day that is not a Trading Day or after 9:00 a.m. (New York City time) and
before midnight (New York City time) on any Trading Day, 9:29 a.m. (New York City time) on the Trading Day immediately following the
date hereof, and (ii) if this Agreement is signed between midnight (New York City time) and 9:00 a.m. (New York City time) on any Trading
Day, no later than 9:29 a.m. (New York City time) on the date hereof.


 


“Effective
Date” means the earliest of the date that (a) the initial Registration Statement has been declared effective by the Commission
registering the resale of all Underlying Shares, (b) all of the Underlying Shares have been sold pursuant to Rule 144 or may be sold
pursuant to Rule 144 without the requirement for the Company to be in compliance with the current public information required under Rule
144 and without volume or manner-of-sale restrictions, (c) following the one year anniversary of the Closing Date provided that a holder
of the Underlying Shares is not an Affiliate of the Company or (d) all of the Underlying Shares may be sold pursuant to an exemption
from registration under Section 4(a)(1) of the Securities Act without volume or manner-of-sale restrictions and Company Counsel has delivered
to such holders a standing written unqualified opinion that resales may then be made by such holders of the Underlying Shares pursuant
to such exemption which opinion shall be in form and substance reasonably acceptable to such holders.



 




    2


     


    

 


“Evaluation
Date” shall have the meaning ascribed to such term in Section 3.1(s).


 


“Exchange
Act” means the Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder.


 


“Exempt
Issuance” means (i) shares of Common Stock or standard options to purchase Common Stock issued to directors, officers, employees,
consultants or independent contractors of the Company for services rendered to the Company in their capacity as such pursuant to an Approved
Stock Plan (as defined above), provided that with respect to all such issuances (taking into account the shares of Common Stock issuable
upon exercise of such options and all cancellations and forfeitures) after the Subscription Date pursuant to this clause (i) other than
in connection with a stock-split or similar antidilution adjustments, the exercise price of any such options is not lowered, none of
such options are amended to increase the number of shares issuable thereunder and none of the terms or conditions of any such options
are otherwise materially changed in any manner that adversely affects any of the Buyers; (ii) shares of Common Stock issued upon the
conversion or exercise of Common Stock Equivalents (other than standard options to purchase Common Stock issued pursuant to an Approved
Stock Plan (as defined in the Warrants) that are covered by clause (i) above) issued prior to the date hereof, provided that the conversion
price of any such Common Stock Equivalents (other than standard options to purchase Common Stock issued pursuant to an Approved Stock
Plan that are covered by clause (i) above) is not lowered (except pursuant to anti-dilution adjustments applicable to the Company’s
preferred stock outstanding prior to the date hereof), none of such Common Stock Equivalents (other than standard options to purchase
Common Stock issued pursuant to an Approved Stock Plan that are covered by clause (i) above) are amended to increase the number of shares
issuable thereunder and none of the terms or conditions of any such Common Stock Equivalents (other than standard options to purchase
Common Stock issued pursuant to an Approved Stock Plan that are covered by clause (i) above) are otherwise materially changed in any
manner that adversely affects any of the Buyers; (iii) the shares of Common Stock issuable upon conversion of the Notes or otherwise
pursuant to the terms of the Notes; provided, that the terms of the Notes are not amended, modified or changed on or after the date hereof
(other than antidilution adjustments pursuant to the terms thereof in effect as of the date hereof and any amendments, modifications
or changes by any agreement by and between the Company and the Required Holders); (iv) the shares of Common Stock issuable upon exercise
of the Warrants; provided, that the terms of the Warrants are not amended, modified or changed on or after the date hereof (other than
antidilution adjustments pursuant to the terms thereof in effect as of the date hereof any amendments, modifications or changes by any
agreement by and between the Company and the Required Holders); (v) securities issued in connection with any bona fide strategic or commercial
alliances, acquisitions, mergers, licensing arrangements, strategic transactions and strategic partnerships approved by a majority of
the disinterested directors of the Company, provided that such securities are issued as “restricted securities” (as defined
in Rule 144) and carry no registration rights that require or permit the filing of any registration statement in connection therewith
during the prohibition period in Section 4.13(a) hereof, provided, further, that (x) the primary purpose of such issuance is not to raise
capital as reasonably determined by a majority of the disinterested directors of the Company, and (y) the purchaser or acquirer or recipient
of the securities in such issuance solely consists of either (I) the actual participants in such strategic or commercial alliance, strategic
or commercial licensing arrangement or strategic or commercial partnership, (II) the actual owners of such assets or securities acquired
in such acquisition or merger or (III) the stockholders, partners, employees, consultants, officers, directors or members of the foregoing
Persons, in each case, which is, itself or through its subsidiaries, an operating company or an owner of an asset, in a business synergistic
with the business of the Company and shall provide to the Company additional benefits in addition to the investment of funds, and (IV)
the number or amount of securities issued to such Persons by the Company shall not be disproportionate to each such Person’s actual
participation in (or fair market value of the contribution to) such strategic or commercial alliance or strategic or commercial partnership
or ownership of such assets or securities to be acquired by the Company, as applicable and (vi) shares of Common Stock issued pursuant
to the Permitted Equity Line or the Permitted ATM (each as defined below).




 




    3


     


    

 


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


 


“GAAP”
shall have the meaning ascribed to such term in Section 3.1(h).


 


“Indebtedness”
shall have the meaning ascribed to such term in Section 3.1(bb).


 


“Intellectual
Property Rights” shall have the meaning ascribed to such term in Section 3.1(o).


 


“KDW”
means Kelley Drye & Warren LLP, with offices located at 3 World Trade Center, 175 Greenwich Street, New York, New York 10007.


 


“Legend
Removal Date” shall have the meaning ascribed to such term in Section 4.1(c).


 


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


 


“Material
Adverse Effect” shall have the meaning assigned to such term in Section 3.1(b).


 


“Material
Permits” shall have the meaning ascribed to such term in Section 3.1(m).


 


“Maximum
Rate” shall have the meaning ascribed to such term in Section 5.17.


 


“Notes”
means the Original Issue Discount Senior Secured Convertible Notes due, subject to the terms therein, 24 months from their date of issuance
(subject to extension as set forth therein), issued by the Company to the Buyers hereunder, in the form of Exhibit A attached
hereto.


 




    4


     


    

 


“Participation
Maximum” shall have the meaning ascribed to such term in Section 4.12(a).


 


“Permitted
ATM” shall have the meaning ascribed to such term in Section 4.13(b).


 


“Permitted
Equity Line” shall have the meaning ascribed to such term in Section 4.13(b).


 


“Person”
means an individual or corporation, partnership, trust, incorporated or unincorporated association, joint venture, limited liability
company, joint stock company, government (or an agency or subdivision thereof) or other entity of any kind.


 


“Placement
Agent” means Digital Offering LLC.


 


“Pledged
Securities” means any and all certificates and other instruments representing or evidencing all of the capital stock and other
equity interests of the Subsidiaries.


 


“Pre-Notice”
shall have the meaning ascribed to such term in Section 4.12(b).


 


“Principal
Amount” means, as to each Buyer, the amounts set forth below such Buyer’s signature block on the signature pages hereto
next to the heading “Principal Amount,” in United States Dollars, which shall equal such Buyer’s Subscription Amount
multiplied by 1.215.


 


“Pro Rata
Portion” shall have the meaning ascribed to such term in Section 4.12(e).


 


“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.


 


“Prohibited
Holder” shall have the meaning ascribed to such term in Section 3.1(h).


 


“Public
Information Failure” shall have the meaning ascribed to such term in Section 4.3(b).


 


“Public
Information Failure Payments” shall have the meaning ascribed to such term in Section 4.3(b).


 


“Registration
Rights Agreement” means the Registration Rights Agreement, dated on or about the date hereof, among the Company and the Buyers,
in the form of Exhibit B attached hereto.


 




    5


     


    

 


“Registration
Statement” means a registration statement meeting the requirements set forth in the Registration Rights Agreement and covering
the resale of the Underlying Shares by each Buyer as provided for in the Registration Rights Agreement.


 


“Required
Approvals” shall have the meaning ascribed to such term in Section 3.1(e).


 


“Required
Reserve Amount” means, as of any date, the sum of (i) 200% of the maximum number of Conversion Shares issuable upon conversion
of the Notes (assuming for purposes hereof that (x) the Notes are convertible at the Alternate Conversion Price (as defined in the Notes)
assuming an Alternate Conversion Date (as defined in the Note) as of the date hereof, and (y) any such conversion shall not take into
account any limitations on the conversion of the Notes set forth in the Notes, and (ii) 100% of the maximum number of Warrant Shares
initially issuable upon exercise of the Warrants (without taking into account any limitations on the exercise of the Warrants set forth
therein).


 


“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
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 Reports”
shall have the meaning ascribed to such term in Section 3.1(h).


 


“Securities”
means the Notes, the Warrants and the Underlying Shares.


 


“Securities
Act” means the Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder.


 


“Security
Agreement” means the Security Agreement, dated the date hereof, among the Company and the Buyers, in the form of Exhibit
E attached hereto.


 


“Security
Documents” shall means initially the Security Agreement and any other documents and filing required thereunder in order to
grant the Buyers a first priority security interest in the assets of the Company as provided in the Security Agreement, including all
UCC-1 filing receipts; provided, that if after the date hereof the Company forms or otherwise acquires any Subsidiaries, such Security
Documents shall also include Guarantees from each such Subsidiary, the original Pledged Securities with respect to each such Subsidiaries,
along with medallion guaranteed executed blank stock powers to the Pledged Securities, and any other documents and filing required thereunder
in order to grant the Buyers a first priority security interest in the assets of each such Subsidiary as provided in the Security Agreement,
including all UCC-1 filing receipts with respect thereto.


 




    6


     


    

 


“Stockholder
Approval” means such approval as may be required by the applicable rules and regulations of the Nasdaq Stock Market (or any
successor entity) from the shareholders of the Company with respect to the transactions contemplated by the Transaction Documents, including
the issuance of all of the Underlying Shares in excess of 19.99% of the issued and outstanding Common Stock on the Closing Date.


 


“Short
Sales” means all “short sales” as defined in Rule 200 of Regulation SHO under the Exchange Act (but shall not be
deemed to include locating and/or borrowing shares of Common Stock). 


 


“Subscription
Amount” means, as to each Buyer, the aggregate amount to be paid for Notes and Warrants purchased hereunder as specified below
such Buyer’s name on the signature page of this Agreement and next to the heading “Subscription Amount,” in United
States dollars and in immediately available funds.


 


“Subsequent
Financing” shall have the meaning ascribed to such term in Section 4.12(a).


 


“Subsequent
Financing Notice” shall have the meaning ascribed to such term in Section 4.12(b).


 


“Subsidiary”
means any direct or indirect subsidiary of the Company (including, without limitation, to the extent formed or acquired after the date
hereof); provided, that the Company has represented to the Buyers that no Subsidiaries exist as of the date hereof and none will be formed
or acquired on or prior to the Closing Date.


 


“Subsidiary
Guarantee” means the Subsidiary Guarantee, to be entered into by any Subsidiary formed or acquired after the date hereof in
favor of the Buyers, in the form of Exhibit F attached hereto.


 


“Trading
Day” means a day on which the principal Trading Market 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 NYSE American, the Nasdaq Capital Market, the Nasdaq Global Market, the Nasdaq Global Select Market, the New York Stock
Exchange (or any successors to any of the foregoing).


 


“Transaction
Documents” means this Agreement, the Notes, the Warrants, the Registration Rights Agreement, the Security Agreement, the Subsidiary
Guarantee, the Voting Agreement, the BR Waiver, all exhibits and schedules thereto and hereto and any other documents or agreements executed
in connection with the transactions contemplated hereunder.


 


“Transfer
Agent” means Computershare Trust Company, N.A., the current transfer agent of the Company, with a mailing address of ___________________
and any successor transfer agent of the Company.


 




    7


     


    

 


“Underlying
Shares” means the Warrant Shares and the Conversion Shares, including without limitation, shares of Common Stock issued and
issuable in lieu of the cash principal payments on the Notes in accordance with the terms of the Notes, in each case without respect
to any limitation or restriction on the conversion of the Notes or the exercise of the Warrants.


 


“Variable
Rate Transaction” shall have the meaning ascribed to such term in Section 4.13(b).


 


“Voting
Agreement” means the written agreement, in the form of Exhibit G attached hereto, of the stockholders set forth on Schedule
6 attached hereto and all of the officers and directors of the Company to vote all voting securities of the Company over which such Persons
have voting control as of the record date for the meeting of stockholders of the Company amounting to, in the aggregate, at least 45%
of the issued and outstanding Common Stock as of the Closing Date


 


“VWAP”
means, for any date, the price determined by the first of the following clauses that applies: (a) if the Common Stock is then listed
or quoted on a Trading Market, the daily volume weighted average price of the Common Stock for such date (or the nearest preceding date)
on the Trading Market on which the Common Stock is then listed or quoted as reported by Bloomberg L.P. (based on a Trading Day from 9:30
a.m. (New York City time) to 4:02 p.m. (New York City time)), (b)  if OTCQB or OTCQX is not a Trading Market, the volume weighted
average price of the Common Stock for such date (or the nearest preceding date) on OTCQB or OTCQX as applicable, (c) if the Common Stock
is not then listed or quoted for trading on OTCQB or OTCQX and if prices for the Common Stock are then reported on the Pink Open Market
(or a similar organization or agency succeeding to its functions of reporting prices), the most recent bid price per share of the Common
Stock so reported, or (d) in all other cases, the fair market value of a share of Common Stock as determined by an independent appraiser
selected in good faith by the Buyers of a majority in interest of the Notes then outstanding and reasonably acceptable to the Company,
the fees and expenses of which shall be paid by the Company.


 


“Warrant
Shares” means the shares of Common Stock issuable upon exercise of the Warrants.


 


“Warrants”
means, collectively, the Common Stock purchase warrants delivered to the Buyers at the Closing in accordance with Section 2.2(a) hereof,
which Warrants shall be exercisable immediately and have a term of exercise equal to five years, in the form of Exhibit C
attached hereto.


 


ARTICLE II. 


PURCHASE AND SALE


 


2.1             
Closing. On the Closing Date, upon the terms and subject to the conditions set forth herein, substantially concurrent with
the execution and delivery of this Agreement by the parties hereto, the Company agrees to sell, and the Buyers, severally and not jointly,
agree to purchase, an aggregate of $6,075,000 in principal amount of the Notes. Each Buyer shall deliver to the Company, via wire transfer,
immediately available funds equal to such Buyer’s Subscription Amount as set forth on the signature page hereto executed by such
Buyer, and the Company shall deliver to each Buyer its respective Note and a Warrant, as determined pursuant to Section 2.2(a), and the
Company and each Buyer shall deliver the other items set forth in Section 2.2 deliverable at the Closing. Upon satisfaction of the covenants
and conditions set forth in Sections 2.2 and 2.3, the Closing shall take place remotely by electronic transfer of the Closing documentation.






 




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2.2             
Deliveries.


 


(a)              
On or prior to the Closing Date, the Company shall deliver or cause to be delivered to each Buyer the following:


 


(i)            
this Agreement duly executed by the Company;




 


(ii)             
a legal opinion of Company Counsel, dated as of the Closing Date, in form and substance reasonably satisfactory to such Buyer;


 


(iii)           
a Note with a principal amount equal to 1.215 times such Buyer’s Subscription Amount, registered in the name of such Buyer;


 


(iv)            
a Warrant registered in the name of such Buyer to purchase up to a number of shares of Common Stock equal to 45% of the quotient
of (I) the Original Principal Amount of the Note divided by (II) 2.4013;


 


(v)              
a letter on, the letterhead of the Company, duly executed by the Chief Executive Officer or Chief Financial Officer of the Company,
setting forth the wire amounts of the Buyer and the wire transfer instructions of the Company;


 


(vi)            
the Security Agreement, duly executed by the Company;


 


(vii)         
appropriate financing statements on Form UCC-1 to be duly filed in such office or offices as may be necessary or, in the opinion
of the Collateral Agent (as defined in the Security Agreement), desirable to perfect the security interests purported to be created by
each Security Document (the “Perfection Certificate”);


 


(viii)       
certified copies of requests for copies of information on Form UCC-11, listing all effective financing statements which name as
debtor the Company or any of its Subsidiaries and which are filed in such office or offices as may be necessary or, in the opinion of
the Collateral Agent or the Buyers, desirable to perfect the security interests purported to be created by the Security Agreement, together
with copies of such financing statements, none of which, except as otherwise agreed in writing by the Collateral Agent, shall cover any
of the Collateral (as defined in the Security Agreement), and the results of searches for any tax Lien and judgment Lien filed against
such Person or its property, which results, except as otherwise agreed to in writing by the Collateral Agent and the Buyers, shall not
show any such Liens;


 


(ix)            
the Perfection Certificate, duly completed and executed by the Company and each of its Subsidiaries, in form and substance satisfactory
to the Buyers;


 




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(x)              
with respect to the Intellectual Property, if any, of the Company, the Company shall have duly executed and delivered to such
Buyer each Assignment For Security for the Intellectual Property of the Company and its Subsidiaries, in the form attached as Exhibit
A to the Security Agreement;


 


(xi)            
each Controlled Account Bank (as defined in the Notes) and the Collateral Agent shall have duly executed and delivered to such
Buyer a Controlled Account Agreement (as defined in the Notes) with respect to each account of the Company or any of its Subsidiaries
held at such Controlled Account Bank;


 


(xii)         
the duly completed and executed Voting Agreement in the form of Exhibit D hereof, by and between the Company and the stockholders
listed on Schedule 2.2(a)(xi) attached hereto;


 


(xiii)       
the Registration Rights Agreement duly executed by the Company;


 


(xiv)        
a certificate evidencing the formation and good standing of the Company issued by the Secretary of State of Delaware as of a date
within ten (10) days of the Closing Date;


 


(xv)          
a certificate evidencing the Company’s qualification as a foreign corporation and good standing issued by the Secretary
of State (or comparable office) of each jurisdiction in which the Company conducts business and is required to so qualify, as of a date
within ten (10) days of the Closing Date;


 


(xvi)        
a certified copy of the Company’s Amended and Restated Certificate of Incorporation (as amended and/or restated to date,
the “Certificate of Incorporation”) as certified by the Delaware Secretary of State within ten (10) days of the Closing
Date;


 


(xvii)     
a certificate, in the form reasonably acceptable to such Buyer, executed by the Secretary of the Company and dated as of the Closing
Date, as to (i) the resolutions as adopted by the Company’s board of directors in a form reasonably acceptable to such Buyer, (ii)
the Certificate of Incorporation of the Company, and (iii) the Bylaws of the Company, each as in effect at the Closing;


 


(xviii)   
a certificate, duly executed by the Chief Executive Officer of the Company, dated as of the Closing Date, consistent with Sections
2.3(b)(i) and 2.3(b)(ii) hereof and as to such other matters as may be reasonably requested by such Buyer in the form reasonably acceptable
to such Buyer;


 


(xix)        
a copy of the Irrevocable Transfer Agent Instructions, in the form acceptable to such Buyer, which instructions shall have been
delivered to and acknowledged in writing by the Transfer Agent;


 




    10


     


    

 


(xx)          
 a letter from the Transfer Agent certifying the number of shares of Common Stock outstanding on the Closing Date immediately
prior to the Closing Date;


 


(xxi)        
evidence of approval of the Principal Market to list or designate for quotation (as the case may be) the Conversion Shares and
the Warrant Shares; and


 


(xxii)     
such other documents, instruments or certificates relating to the transactions contemplated by this Agreement as such Buyer or
its counsel may reasonably request.


 


(b)              
On or prior to the Closing Date, each Buyer shall deliver or cause to be delivered to the Company, the following:


 


		(i)	this Agreement duly executed by such Buyer;



 


		(ii)	such Buyer’s Subscription Amount
                                            by wire transfer to the account specified in writing by the Company;



 


(iii)           
the Security Agreement duly executed by such Buyer; and


 


(iv)            
the Registration Rights Agreement duly executed by such Buyer.


 


2.3             
Closing Conditions.


 


(a)                 
The obligations of the Company hereunder in connection with the Closing are subject to the following conditions being met:


 


(i)                
the accuracy in all material respects (or, to the extent representations or warranties are qualified by materiality, in all respects)
on the Closing Date of the representations and warranties of the Buyers contained herein (unless as of a specific date therein in which
case they shall be accurate in all material respects (or, to the extent representations or warranties are qualified by materiality, in
all respects) as of such date);


 


(ii)             
all obligations, covenants and agreements of each Buyer required to be performed at or prior to the Closing Date shall have been
performed; and


 


(iii)            
the delivery by each Buyer of the items set forth in Section 2.2(b) of this Agreement.


 


(b)                 
The respective obligations of the Buyers hereunder in connection with the Closing are subject to the following conditions being
met:


 


(i)                
the accuracy in all material respects (or, to the extent representations or warranties are qualified by materiality or Material
Adverse Effect, in all respects) when made and on the Closing Date of the representations and warranties of the Company contained herein
(unless as of a specific date therein in which case they shall be accurate in all material respects or, to the extent representations
or warranties are qualified by materiality or Material Adverse Effects, in all respects) as of such date);


 




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(ii)             
all obligations, covenants and agreements of the Company required to be performed at or prior to the Closing Date shall have been
performed;


 


(iii)             
no Issuer Covered Person shall have suffered a Disqualification Event (each as defined under Commission Rule 506);


 


(iv)            
the delivery by the Company of the items set forth in Section 2.2(a) of this Agreement;


 


(v)              
there shall have been no Material Adverse Effect with respect to the Company;


 


(vi)            
The Permitted Equity Line has not been terminated or the registration statement with respect thereof hasn’t lapsed


 


(vii)         
from the date hereof to the Closing Date, trading in the Common Stock shall not have been suspended by the Commission or the Company’s
principal Trading Market and, at any time prior to the Closing Date, trading in securities generally as reported by Bloomberg L.P. shall
not have been suspended or limited, or minimum prices shall not have been established on securities whose trades are reported by such
service, or on any Trading Market, nor shall a banking moratorium have been declared either by the United States or New York State authorities
nor shall there have occurred any material outbreak or escalation of hostilities or other national or international calamity of such
magnitude in its effect on, or any material adverse change in, any financial market which, in each case, in the reasonable judgment of
such Buyer, makes it impracticable or inadvisable to purchase the Securities at the Closing.


 


ARTICLE III. 


REPRESENTATIONS AND WARRANTIES


 


3.1             
Representations and Warranties of the Company. Except as set forth in the Disclosure Schedules, which Disclosure Schedules
shall be deemed a part hereof and shall qualify any representation or otherwise made herein to the extent of the disclosure contained
in the corresponding section of the Disclosure Schedules, the Company hereby makes the following representations and warranties to each
Buyer:


 


(a)              
Subsidiaries. As of the date hereof and as of the Closing Date, the Company does not own, directly or indirectly, any capital
stock or other equity interests of any Person. Until such time as the Company has any Subsidiaries, all references to Subsidiaries or
any of them in the Transaction Documents shall be disregarded.


 




    12


     


    

 


(b)  
 Organization and Qualification. The Company and each of the Subsidiaries is an entity duly incorporated or otherwise organized,
validly existing and in good standing under the laws of the jurisdiction of its incorporation or organization, with the requisite power
and authority to own and use its properties and assets and to carry on its business as currently conducted. Neither the Company nor any
Subsidiary is in violation nor default of any of the provisions of its respective certificate or articles of incorporation, bylaws or
other organizational or charter documents. Each of the Company and the Subsidiaries is duly qualified to conduct business and is in good
standing as a foreign corporation or other entity in each jurisdiction in which the nature of the business conducted or property owned
by it makes such qualification necessary, except where the failure to be so qualified or in good standing, as the case may be, would
not have or reasonably be expected to result in: (i) a material adverse effect on the legality, validity or enforceability of any Transaction
Document, (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 any Transaction Document (any of (i), (ii) or (iii), a “Material
Adverse Effect”) and no Proceeding has been instituted in any such jurisdiction revoking, limiting or curtailing or seeking
to revoke, limit or curtail such power and authority or qualification.


 


(c)  
Authorization; Enforcement.


 


(i)                
The Company has the requisite corporate power and authority to enter into and to consummate the transactions contemplated by this
Agreement and each of the other Transaction Documents and otherwise to carry out its obligations hereunder and thereunder. The execution
and delivery of this Agreement and each of the other Transaction Documents by the Company and the consummation by it of the transactions
contemplated hereby and thereby have been duly authorized by all necessary action on the part of the Company and no further action is
required by the Company, the Board of Directors or the Company’s stockholders in connection herewith or therewith other than in
connection with the Required Approvals. This Agreement and each other Transaction Document to which it is a party has been (or upon delivery
will have been) duly executed by the Company and, when delivered in accordance with the terms hereof and thereof, will constitute the
valid and binding obligation of the Company enforceable against the Company in accordance with its terms, except (i) as limited by general
equitable principles and applicable bankruptcy, insolvency, reorganization, moratorium and other laws of general application affecting
enforcement of creditors’ rights generally, (ii) as limited by laws relating to the availability of specific performance, injunctive
relief or other equitable remedies and (iii) insofar as indemnification and contribution provisions may be limited by applicable law.





 




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(d)  
No Conflicts. The execution, delivery and performance by the Company of this Agreement and the other Transaction Documents
to which it is a party, the issuance and sale of the Securities and the consummation by it of the transactions contemplated hereby and
thereby do not and will not (i) conflict with or violate any provision of the Company’s or any Subsidiary’s certificate or
articles of incorporation, bylaws or other organizational or charter documents, or (ii) conflict with, or constitute a default (or an
event that with notice or lapse of time or both would become a default) under, result in the creation of any Lien upon any of the properties
or assets of the Company or any Subsidiary, or give to others any rights of termination, amendment, anti-dilution or similar adjustments,
acceleration or cancellation (with or without notice, lapse of time or both) of, any agreement, credit facility, debt or other instrument
(evidencing a Company or Subsidiary debt or otherwise) or other understanding to which the Company or any Subsidiary is a party or by
which any property or asset of the Company or any Subsidiary is bound or affected, or (iii) subject to the Required Approvals, conflict
with or result in a violation of any law, rule, regulation, order, judgment, injunction, decree or other restriction of any court or
governmental authority to which the Company or a Subsidiary is subject (including federal and state securities laws and regulations),
or by which any property or asset of the Company or a Subsidiary is bound or affected; except in the case of each of clauses (ii) and
(iii), such as would not have or reasonably be expected to result in a Material Adverse Effect.


 


(e)  
Filings, Consents and Approvals. The Company is not required to obtain any consent, waiver, authorization or order of,
give any notice to, or make any filing or registration with, any court or other federal, state, local or other governmental authority
or other Person in connection with the execution, delivery and performance by the Company of the Transaction Documents, other than: (i)
the filings required pursuant to Section 4.6 of this Agreement, (ii) the filing with the Commission pursuant to the Registration Rights
Agreement, (iii) the notice and/or application(s) to each applicable Trading Market for the issuance and sale of the Securities and the
listing of the Conversion Shares and Warrant Shares for trading thereon in the time and manner required thereby, (iv) the filing of Form
D with the Commission and such filings as are required to be made under applicable state securities laws and (v) Stockholder Approval
(collectively, the “Required Approvals”).


 


(f)  Issuance
of the Securities. The Securities are duly authorized and, when issued and paid for in accordance with the applicable Transaction
Documents, will be duly and validly issued, fully paid and nonassessable, free and clear of all Liens imposed by the Company other than
restrictions on transfer provided for in the Transaction Documents or under federal or state securities laws. The Underlying Shares,
when issued in accordance with the terms of the Transaction Documents, will be validly issued, fully paid and nonassessable, free and
clear of all Liens imposed by the Company other than restrictions on transfer provided for in the Transaction Documents or under federal
or state securities laws. The Company has reserved from its duly authorized capital stock a number of shares of Common Stock for issuance
of the Underlying Shares at least equal to the Required Reserve Amount on the date hereof.


 




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(g)  
Capitalization. The capitalization of the Company as of the date hereof is as set forth on Schedule 3.1(g), which
Schedule 3.1(g) shall also include the number of shares of Common Stock and Common Stock Equivalents owned beneficially, and of
record, by Affiliates of the Company as of the date hereof. The Company has not issued any capital stock since its most recently filed
periodic report under the Exchange Act, other than pursuant to the exercise of employee stock options under the Company’s equity
incentive plans, the issuance of shares of Common Stock or stock options to employees and directors pursuant to the Company’s equity
incentive plan and pursuant to the conversion and/or exercise of Common Stock Equivalents outstanding as of the date of the most recently
filed periodic report under the Exchange Act, or issuances of capital stock to consultants in the ordinary course of business. No Person
has any right of first refusal, preemptive right, right of participation, or any similar right to participate in the transactions contemplated
by the Transaction Documents. Except as a result of the purchase and sale of the Securities or as disclosed in the SEC Reports (as defined
below), 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 Securities will not obligate the Company or any Subsidiary to issue
shares of Common Stock or other securities to any Person (other than the Buyers). Except as set forth on Schedule 3.1(g) or as disclosed
in the SEC Reports, there are no outstanding securities or instruments of the Company or any Subsidiary with any provision that adjusts
the exercise, conversion, exchange or reset price of such security or instrument upon an issuance of securities by the Company or any
Subsidiary. Except as disclosed in the SEC Reports, 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. Except as disclosed in the SEC Reports, there are no stockholders agreements, voting
agreements or other similar agreements with respect to the Company’s capital stock to which the Company is a party or, to the knowledge
of the Company, between or among any of the Company’s stockholders. The Exchange Cap (as defined in the Notes) available and reserved
as of the date hereof to the Buyers for the issuance of shares of Common Stock pursuant to the Notes and the Warrants is [ ] and will
not include shares of Common Stock issued pursuant to the Permitted Equity Line.


 


(h)  
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 Commission with respect
thereto as in effect at the time of filing. Such financial statements have been prepared in accordance with United States generally accepted
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.


 




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(i)    
Material Changes; Undisclosed Events, Liabilities or Developments. Since the date of the latest audited financial statements
included within the SEC Reports, except as set forth on Schedule 3.1(i), (i) there has been no event, occurrence or development
that has had or that would 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 stockholders 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 equity incentive plans. The Company does not have pending before the Commission any request for confidential
treatment of information. Except for the issuance of the Securities contemplated by this Agreement or as set forth on Schedule 3.1(i),
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.


 


(j)    
Litigation. Except as set forth on Schedule 3.1(j), there is no material 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”). None of the Actions set forth on Schedule
3.1(j), (i) adversely affects or challenges the legality, validity or enforceability of any of the Transaction Documents or the Securities
or (ii) would, 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 Commission 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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(k)  
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. 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 would not, individually or in the aggregate, reasonably be expected to have a Material Adverse
Effect.


 


(l)    
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 would not have or reasonably be
expected to result in a Material Adverse Effect.


 


(m) 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 would be reasonably expected to have, individually or in the aggregate, a Material Adverse Effect.


 




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(n)  
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 would 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.


 


(o)  
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 and (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. 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.


 


(p)  
Intellectual Property. The Company and the Subsidiaries have, or have rights to use, all 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 would reasonably be expected to have a Material Adverse Effect (collectively, the “Intellectual
Property Rights”). To the Company’s knowledge, 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 would not have or reasonably be expected
to not have a Material Adverse Effect. To the knowledge of the Company, all such Intellectual Property Rights are enforceable and there
is no existing infringement by another Person of any of the Intellectual Property Rights. 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 would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.


 






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


 


(r)   
Transactions with Affiliates and Employees. Except as set forth on Schedule 3.1(r), 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 equity incentive plan of the Company.


 


(s)   
Sarbanes-Oxley; Internal Accounting Controls. The Company and the Subsidiaries are in compliance in all material respects
with any and all applicable requirements of the Sarbanes-Oxley Act of 2002, as amended, 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) that
have materially affected, or is reasonably likely to materially affect, the internal control over financial reporting of the Company
and its Subsidiaries.


 






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(t)      Certain Fees. Except for fees payable by the Company to Digital Offering and disclosed to the Buyers, no brokerage or finder’s
fees or commissions are or will be payable by the Company or any Subsidiaries to any broker, financial advisor or consultant, finder,
placement agent, investment banker, bank or other Person with respect to the transactions contemplated by the Transaction Documents.
The Buyers shall have no obligation with respect to any fees or with respect to any claims made by or on behalf of other Persons for
fees of a type contemplated in this Section that may be due in connection with the transactions contemplated by the Transaction Documents.


 


(u)  
Private Placement. Assuming the accuracy of the Buyers’ representations and warranties set forth in Section 3.2,
no registration under the Securities Act is required for the offer and sale of the Securities by the Company to the Buyers as contemplated
hereby. The issuance and sale of the Securities hereunder does not contravene the rules and regulations of the Trading Market.


 


(v)  
Investment Company. The Company is not, and is not an Affiliate of, and immediately after receipt of payment for the Securities,
will not be or be an Affiliate of, an “investment company” within the meaning of the Investment Company Act of 1940, as amended.


 


(w) Registration
Rights. Except as set forth on Schedule 3.1(w), other than each of the Buyers, 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 Subsidiaries.


 


(x)  
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. 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.


 






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(y)  
Application of Takeover Protections. Assuming the accuracy of the representations and warranties of Buyers in Section 3.2(h),
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 Buyers as a result of the Buyers and the Company fulfilling their obligations or exercising their rights
under the Transaction Documents, including without limitation as a result of the Company’s issuance of the Securities and the Buyers’
ownership of the Securities.


 


(z)  
Disclosure. Except with respect to the material terms and conditions of the transactions contemplated by the Transaction
Documents (including the use of proceeds of the Notes), the Company confirms that neither it nor any other Person acting on its behalf
has provided any of the Buyers or their agents or counsel with any information that it believes constitutes or might constitute material,
non-public information for purposes of U.S. federal securities laws. The Company understands and confirms that the Buyers 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 Buyers regarding the Company and its Subsidiaries, their respective businesses and the transactions contemplated
hereby, including the Disclosure Schedules to this Agreement, is true and correct in all material respects and does not contain any untrue
statement of a material fact or omit to state any material fact necessary in order to make the statements made therein, in the light
of the circumstances under which they were made, not misleading. 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 the light of the circumstances under which
they were made and when made, not misleading. The Company acknowledges and agrees that no Buyer makes or has made any representations
or warranties with respect to the transactions contemplated hereby other than those specifically set forth in Section 3.2 hereof.


 


(aa)           
No Integrated Offering. Assuming the accuracy of the Buyers’ representations and warranties set forth in Section
3.2, neither the Company, nor any of its Affiliates, nor any Person acting on its or their behalf has, directly or indirectly, made any
offers or sales of any security or solicited any offers to buy any security, under circumstances that would cause this offering of the
Securities to be integrated with prior offerings by the Company for purposes of (i) the Securities Act which would require the registration
of any such securities under the Securities Act, or (ii) any applicable shareholder approval provisions of any Trading Market on which
any of the securities of the Company are listed or designated.


 






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(bb)          
 Solvency. Based on the consolidated financial condition of the Company as of the Closing Date, after giving effect to the
receipt by the Company of the proceeds from the sale of the Securities hereunder, (i) the fair saleable value of the Company’s
assets exceeds the amount that will be required to be paid on or in respect of the Company’s existing debts and other liabilities
(including known contingent liabilities) as they mature, (ii) the Company’s assets do not constitute unreasonably small capital
to carry on its business as now conducted and as proposed to be conducted including its capital needs taking into account the particular
capital requirements of the business conducted by the Company, consolidated and projected capital requirements and capital availability
thereof, and (iii) the current cash flow of the Company, together with the proceeds the Company would receive, were it to liquidate all
of its assets, after taking into account all anticipated uses of the cash, would be sufficient to pay all amounts on or in respect of
its liabilities when such amounts are required to be paid. The Company does not intend to incur debts beyond its ability to pay such
debts as they mature (taking into account the timing and amounts of cash to be payable on or in respect of its debt). The Company has
no knowledge of any facts or circumstances which lead it to believe that it will file for reorganization or liquidation under the bankruptcy
or reorganization laws of any jurisdiction within one year from the Closing Date. Schedule 3.1(bb) sets forth as of the date hereof
all outstanding secured and unsecured Indebtedness of the Company or any Subsidiary, or for which the Company or any Subsidiary has commitments.
For the purposes of this Agreement, “Indebtedness” means (x) any liabilities for borrowed money or amounts owed in
excess of $50,000 (other than trade accounts payable incurred in the ordinary course of business), (y) all guaranties, endorsements and
other contingent obligations in respect of indebtedness of others, whether or not the same are or should be reflected in the Company’s
consolidated balance sheet (or the notes thereto), except guaranties by endorsement of negotiable instruments for deposit or collection
or similar transactions in the ordinary course of business; and (z) the present value of any lease payments in excess of $50,000 due
under leases required to be capitalized in accordance with GAAP. Neither the Company nor any Subsidiary is in default with respect to
any Indebtedness.


 


(cc)           
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 provision 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.


 


(dd)          
No General Solicitation. Neither the Company nor any Person acting on behalf of the Company has offered or sold any of
the Securities by any form of general solicitation or general advertising. The Company has offered the Securities for sale only to the
Buyers and certain other “accredited investors” within the meaning of Rule 501 under the Securities Act.


 






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(ee)           
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 FCPA.


 


(ff) 
Accountants. The Company’s accounting firm is set forth on Schedule 3.1(ff) of the Disclosure Schedules. 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, 2022.


 


(gg)          
Seniority. As of the Closing Date, no Indebtedness or other claim against the Company is senior to the Notes in right of
payment, whether with respect to interest or upon liquidation or dissolution, or otherwise, other than indebtedness secured by purchase
money security interests (which is senior only as to underlying assets covered thereby) and capital lease obligations (which is senior
only as to the property covered thereby).


 


(hh)          
No Disagreements with Accountants and Lawyers. There are no disagreements of any kind presently existing, or reasonably
anticipated by the Company to arise, between the Company and the accountants and lawyers formerly or presently employed by the Company
and the Company is current with respect to any fees owed to its accountants and lawyers which could affect the Company’s ability
to perform any of its obligations under any of the Transaction Documents.


 


(ii) 
Acknowledgment Regarding Buyers’ Purchase of Securities. The Company acknowledges and agrees that each of the Buyers
is acting solely in the capacity of an arm’s length purchaser with respect to the Transaction Documents and the transactions contemplated
thereby. The Company further acknowledges that no Buyer is acting as a financial advisor or fiduciary of the Company (or in any similar
capacity) with respect to the Transaction Documents and the transactions contemplated thereby and any advice given by any Buyer or any
of their respective representatives or agents in connection with the Transaction Documents and the transactions contemplated thereby
is merely incidental to the Buyers’ purchase of the Securities. The Company further represents to each Buyer that the Company’s
decision to enter into this Agreement and the other Transaction Documents has been based solely on the independent evaluation of the
transactions contemplated hereby by the Company and its representatives.


 






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(jj) 
 Acknowledgment Regarding Buyer’s Trading Activity.
Anything in this Agreement or elsewhere herein to the contrary notwithstanding (except for Sections 3.2(g) and 4.15 hereof), it is understood
and acknowledged by the Company that: (i) none of the Buyers has been asked by the Company to agree, nor has any Buyer agreed, to desist
from purchasing or selling, long and/or short, securities of the Company, or “derivative” securities based on securities
issued by the Company or to hold the Securities for any specified term, (ii) past or future open market or other transactions by any
Buyer, specifically including, without limitation, Short Sales or “derivative” transactions, before or after the closing
of this or future private placement transactions, may negatively impact the market price of the Company’s publicly-traded securities,
(iii) any Buyer, and counter-parties in “derivative” transactions to which any such Buyer is a party, directly or indirectly,
may presently have a “short” position in the Common Stock and (iv) each Buyer shall not be deemed to have any affiliation
with or control over any arm’s length counter-party in any “derivative” transaction. The Company further understands
and acknowledges that (y) one or more Buyers may engage in hedging activities at various times during the period that the Securities
are outstanding, including, without limitation, during the periods that the value of the Underlying Shares deliverable with respect to
Securities are being determined, and (z) such hedging activities (if any) could reduce the value of the existing stockholders' equity
interests in the Company at and after the time that the hedging activities are being conducted.  The Company acknowledges that such
aforementioned hedging activities do not constitute a breach of any of the Transaction Documents.


 


(kk)          
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 Securities, (ii) sold, bid for, purchased, or paid any compensation for soliciting purchases
of, any of the Securities, or (iii) paid or agreed to pay to any Person any compensation for soliciting another to purchase any other
securities of the Company.


 


(ll) 
Form S-1 Eligibility.The Company is eligible to register the resale of the Underlying
Shares for resale by the Buyer on Form S-1 promulgated under the Securities Act.


 


(mm)     
Equity Incentive Plans. Each stock option granted by the Company under the Company’s equity incentive plans was granted
(i) in accordance with the terms of such equity incentive plans and (ii) with an exercise price at least equal to the fair market value
of the Common Stock on the date such stock option would be considered granted under GAAP and applicable law. No stock option granted
under the Company’s equity incentive plans has been backdated. The Company has not knowingly granted, and there is no and has been
no Company policy or practice to knowingly grant, stock options prior to, or otherwise knowingly coordinate the grant of stock options
with, the release or other public announcement of material information regarding the Company or its Subsidiaries or their financial results
or prospects.


 






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(nn)           Cybersecurity. 
(i)(x) To the Company’s knowledge, there has been no material security breach or other compromise of or relating to any of the
Company’s or any Subsidiary’s information technology and computer systems, networks, hardware, software, data (including
the data of its respective customers, employees, suppliers, vendors and any third party data maintained by or on behalf of it),
equipment or technology (collectively, “IT Systems and Data”) and (y) the Company and the Subsidiaries have not
been notified of, and has no knowledge of any event or condition that would reasonably be expected to result in, any security breach
or other compromise to its IT Systems and Data; (ii) the Company and the Subsidiaries are presently in compliance with all
applicable laws or statutes and all judgments, orders, rules and regulations of any court or arbitrator or governmental or
regulatory authority, internal policies and contractual obligations relating to the privacy and security of IT Systems and Data and
to the protection of such IT Systems and Data from unauthorized use, access, misappropriation or modification, except as would not,
individually or in the aggregate, have a Material Adverse Effect; (iii) the Company and the Subsidiaries have implemented and
maintained commercially reasonable safeguards to maintain and protect its material confidential information and the integrity,
continuous operation, redundancy and security of all IT Systems and Data; and (iv) the Company and the Subsidiaries have implemented
backup and disaster recovery technology consistent with industry standards and practices.


 


(oo)          
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 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”).


 


(pp)          
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 Buyer’s
request.


 


(qq)          
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.


 


(rr) 
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.


 






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(ss) No Disqualification
Events. With respect to the Securities to be offered and sold hereunder in reliance on Rule 506 under the Securities Act, none of
the Company, any of its predecessors, any affiliated issuer, any director, executive officer, other officer of the Company participating
in the offering hereunder, any beneficial owner of 20% or more of the Company’s outstanding voting equity securities, calculated
on the basis of voting power, nor any promoter (as that term is defined in Rule 405 under the Securities Act) connected with the Company
in any capacity at the time of sale (each, an “Issuer Covered Person” and, together, “Issuer Covered Persons”)
is subject to any of the "Bad Actor" disqualifications described in Rule 506(d)(1)(i) to (viii) under the Securities Act (a
“Disqualification Event”), except for a Disqualification Event covered by Rule 506(d)(2) or (d)(3). The Company has
exercised reasonable care to determine whether any Issuer Covered Person is subject to a Disqualification Event. The Company has complied,
to the extent applicable, with its disclosure obligations under Rule 506(e), and has furnished to the Buyers a copy of any disclosures
provided thereunder.


 


(tt) 
Other Covered Persons. Other than Digital Offering, the Company is not aware of any person (other than any Issuer Covered
Person) that has been or will be paid (directly or indirectly) remuneration for solicitation of purchasers in connection with the sale
of any Securities.


 


(uu)          
Notice of Disqualification Events. The Company will notify the Buyers in writing, prior to the Closing Date of (i) any
Disqualification Event relating to any Issuer Covered Person and (ii) any event that would, with the passage of time, become a Disqualification
Event relating to any Issuer Covered Person.


 


3.2             
Representations and Warranties of the Buyers. Each Buyer, for itself and for no other Buyer, hereby represents and warrants
as of the date hereof and as of the Closing Date to the Company as follows (unless as of a specific date therein, in which case they
shall be accurate as of such date):


 


(a)  
Organization; Authority. Such Buyer is either an individual or an entity duly incorporated or formed, validly existing
and in good standing under the laws of the jurisdiction of its incorporation or formation with full right, corporate, partnership, limited
liability company or similar power and authority to enter into and to consummate the transactions contemplated by the Transaction Documents
and otherwise to carry out its obligations hereunder and thereunder. The execution and delivery of the Transaction Documents and performance
by such Buyer of the transactions contemplated by the Transaction Documents have been duly authorized by all necessary corporate, partnership,
limited liability company or similar action, as applicable, on the part of such Buyer. Each Transaction Document to which it is a party
has been duly executed by such Buyer, and when delivered by such Buyer in accordance with the terms hereof, will constitute the valid
and legally binding obligation of such Buyer, enforceable against it in accordance with its terms, except (i) as limited by general equitable
principles and applicable bankruptcy, insolvency, reorganization, moratorium and other laws of general application affecting enforcement
of creditors’ rights generally, (ii) as limited by laws relating to the availability of specific performance, injunctive relief
or other equitable remedies and (iii) insofar as indemnification and contribution provisions may be limited by applicable law.


 






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(b)  
 Own Account. Such Buyer understands that the Securities are “restricted securities” and have not been registered
under the Securities Act or any applicable state securities law and is acquiring the Securities as principal for its own account and
not with a view to or for distributing or reselling such Securities 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 Securities in violation of the Securities Act or any applicable
state securities law and has no direct or indirect arrangement or understandings with any other persons to distribute or regarding the
distribution of such Securities in violation of the Securities Act or any applicable state securities law (this representation and warranty
not limiting such Buyer’s right to sell the Securities pursuant to the Registration Statement or otherwise in compliance with applicable
federal and state securities laws). Such Buyer is acquiring the Securities hereunder in the ordinary course of its business.


 


(c)  
Buyer Status. At the time such Buyer was offered the Securities, it was, and as of the date hereof it is, and on each date
on which it exercises any Warrants or converts any Notes it will be an “accredited investor” as defined in Rule 501(a)(1),
(a)(2), (a)(3), (a)(7), (a)(8), (a)(9), (a)(12), or (a)(13) under the Securities Act.


 


(d)  
Experience of Such Buyer. Such Buyer, either alone or together with its representatives, has such knowledge, sophistication
and experience in business and financial matters so as to be capable of evaluating the merits and risks of the prospective investment
in the Securities, and has so evaluated the merits and risks of such investment. Such Buyer is able to bear the economic risk of an investment
in the Securities and, at the present time, is able to afford a complete loss of such investment.


 


(e)  
General Solicitation. Such Buyer is not, to such Buyer’s knowledge, purchasing the Securities as a result of any
advertisement, article, notice or other communication regarding the Securities published in any newspaper, magazine or similar media
or broadcast over television or radio or presented at any seminar or, to the knowledge of such Buyer, any other general solicitation
or general advertisement.


 


(f)   
Access to Information. Such Buyer acknowledges that it has had the opportunity to review the Transaction Documents (including
all exhibits and schedules thereto) and the SEC Reports and has been afforded (i) the opportunity to ask such questions as it has deemed
necessary of, and to receive answers from, representatives of the Company concerning the terms and conditions of the offering of the
Securities and the merits and risks of investing in the Securities; (ii) access to information about the Company and its financial condition,
results of operations, business, properties, management and prospects sufficient to enable it to evaluate its investment; and (iii) the
opportunity to obtain such additional information that the Company possesses or can acquire without unreasonable effort or expense that
is necessary to make an informed investment decision with respect to the investment.


 






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(g)   Certain
Transactions and Confidentiality. Other than consummating the transactions contemplated hereunder, such Buyer has not, nor has
any Person acting on behalf of or pursuant to any understanding with such Buyer, directly or indirectly executed any purchases or
sales, including Short Sales, of the securities of the Company during the period commencing as of the
time that such Buyer first received a term sheet (written or oral) from the Company or any other Person representing the Company
setting forth the material terms of the transactions contemplated hereunder and ending immediately prior to the execution hereof.
Notwithstanding the foregoing, in the case of a Buyer that is a multi-managed investment vehicle whereby separate portfolio managers
manage separate portions of such Buyer’s assets and the portfolio managers have no direct knowledge of the investment
decisions made by the portfolio managers managing other portions of such Buyer’s assets, the representation set forth above
shall only apply with respect to the portion of assets managed by the portfolio manager that made the investment decision to
purchase the Securities covered by this Agreement. Other than to other Persons party to this Agreement or to such Buyer’s
representatives, including, without limitation, its officers, directors, partners, legal and other advisors, employees, agents and
Affiliates, such Buyer has maintained the confidentiality of all disclosures made to it in connection with this transaction
(including the existence and terms of this transaction). Notwithstanding the foregoing, for the avoidance of doubt, nothing
contained herein shall constitute a representation or warranty against, or a prohibition of, any actions with respect to the
borrowing of, arrangement to borrow, identification of the availability of, and/or securing of, securities of the Company in order
for such Buyer (or its broker or other financial representative) to effect Short Sales or similar transactions in the
future.


 


(h)  
Not a Prohibited Holder. Such Buyer (i) is not a person that is, or is owned or controlled by a person that is (1) the
subject of any sanctions administered or enforced by the U.S. Department of Treasury’s Office of Foreign Assets Control, the UN
Security Council, the European Union, Her Majesty’s Treasury, or other relevant sanctions authority (collectively, “Sanctions”),
nor (2) located, organized or resident in a country or territory that is the subject of Sanctions including, without limitation, Cuba,
Iran, North Korea, Syria and the Crimea, Luhansk and Donetsk regions of Ukraine (a “Prohibited Holder”) and (ii) further
affirms that the funds that such Buyer will pay the Company in the transactions contemplated hereby will comply with all applicable U.S.
or other money laundering laws.


 


The Company acknowledges and agrees that the
representations contained in this Section 3.2 shall not modify, amend or affect such Buyer’s right to rely on the Company’s
representations and warranties contained in this Agreement or any representations and warranties contained in any other Transaction Document
or any other document or instrument executed and/or delivered in connection with this Agreement or the consummation of the transactions
contemplated hereby. Notwithstanding the foregoing, for the avoidance of doubt, nothing contained herein shall constitute a representation
or warranty, or preclude any actions, with respect to locating or borrowing shares in order to effect Short Sales or similar transactions
in the future.


 


ARTICLE IV. 


OTHER AGREEMENTS OF THE PARTIES


 


4.1             
Transfer Restrictions.


 


(a)   The
Securities may only be disposed of in compliance with state and federal securities laws. In connection with any transfer of
Securities other than pursuant to an effective registration statement or Rule 144, to the Company or to an Affiliate of a Buyer or
in connection with a pledge as contemplated in Section 4.1(b), the Company may require the transferor thereof to provide to the
Company an opinion of counsel selected by the transferor and reasonably acceptable to the Company, the form and substance of which
opinion shall be reasonably satisfactory to the Company, to the effect that such transfer does not require registration of such
transferred Securities under the Securities Act. As a condition of transfer, any such transferee shall agree in writing to be bound
by the terms of this Agreement and the Registration Rights Agreement and shall have the rights and obligations of a Buyer under this
Agreement and the Registration Rights Agreement.


 






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(b)  
The Buyers agree to the imprinting, so long as is required by this Section 4.1, of a legend on any of the Securities in the following
form:


 


[NEITHER] THIS SECURITY [NOR THE SECURITIES
INTO WHICH THIS SECURITY IS [EXERCISABLE] [CONVERTIBLE]] HAS [NOT] BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION OR THE
SECURITIES COMMISSION OF ANY STATE IN RELIANCE UPON AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
“SECURITIES ACT”), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER
THE SECURITIES ACT OR PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE
SECURITIES ACT AND IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS. THIS SECURITY [AND THE SECURITIES ISSUABLE UPON [EXERCISE] [CONVERSION]
OF THIS SECURITY] MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT WITH A REGISTERED BROKER-DEALER OR OTHER LOAN WITH A FINANCIAL
INSTITUTION THAT IS AN “ACCREDITED INVESTOR” AS DEFINED IN RULE 501(a) UNDER THE SECURITIES ACT OR OTHER LOAN SECURED BY
SUCH SECURITIES.


 


The Company acknowledges
and agrees that a Buyer may from time to time pledge pursuant to a bona fide margin agreement with a registered broker-dealer or grant
a security interest in some or all of the Securities to a financial institution that is an “accredited investor” as defined
in Rule 501(a) under the Securities Act and, if required under the terms of such arrangement, such Buyer may transfer pledged or secured
Securities to the pledgees or secured parties. Such a pledge or transfer would not be subject to approval of the Company and no legal
opinion of legal counsel of the pledgee, secured party or pledgor shall be required in connection therewith. Further, no notice shall
be required of such pledge. At the appropriate Buyer’s expense, the Company will execute and deliver such reasonable documentation
as a pledgee or secured party of Securities may reasonably request in connection with a pledge or transfer of the Securities, including,
if the Securities are subject to registration pursuant to the Registration Rights Agreement, the preparation and filing of any required
prospectus supplement under Rule 424(b)(3) under the Securities Act or other applicable provision of the Securities Act to appropriately
amend the list of Selling Stockholders (as defined in the Registration Rights Agreement) thereunder.


 






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(c)  
 Certificates evidencing the Underlying Shares shall not contain any legend (including the legend set forth in Section 4.1(b)
hereof): (i) while a registration statement (including the Registration Statement) covering the resale of such security is effective
under the Securities Act, (ii) following any sale of such Underlying Shares pursuant to Rule 144 (assuming cashless exercise of the Warrants),
(iii) if such Underlying Shares are eligible for sale under Rule 144 (assuming cashless exercise of the Warrants), without the volume
or manner-of-sale restriction or (iv) if such legend is not required under applicable requirements of the Securities Act (including judicial
interpretations and pronouncements issued by the staff of the Commission). The Company shall cause its counsel to issue a legal opinion
to the Transfer Agent or the Buyer promptly after the Effective Date and at such other times as such legend is no longer required under
this Section 4.1(c), and in any event within such time as to enable the Transfer Agent to remove the legend hereunder by the Legend Removal
Date if required by the Transfer Agent to effect the removal of the legend hereunder, or if requested by a Buyer, respectively. If all
or any portion of a Note is converted or Warrant is exercised at a time when there is an effective registration statement to cover the
resale of the Underlying Shares, or if such Underlying Shares may be sold under Rule 144 without the requirement for the Company to be
in compliance with the current public information required under Rule 144 (assuming cashless exercise of the Warrants) as to such Underlying
Shares and without volume or manner-of-sale restrictions or if such legend is not otherwise required under applicable requirements of
the Securities Act (including judicial interpretations and pronouncements issued by the staff of the Commission) then such Underlying
Shares shall be issued free of all legends. The Company agrees that following the Effective Date or at such other time as such legend
is no longer required under this Section 4.1(c), it will, no later than the earlier of (i) two (2) Trading Days and (ii) the number of
Trading Days comprising the Standard Settlement Period (as defined below) following the delivery by a Buyer to the Company or the Transfer
Agent of a certificate representing Underlying Shares, as applicable, issued with a restrictive legend (such date, the “Legend
Removal Date”), deliver or cause to be delivered to such Buyer 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. Certificates for Underlying Shares subject to legend removal hereunder shall
be transmitted by the Transfer Agent to the Buyer by crediting the account of the Buyer’s prime broker with the Depository Trust
Company System as directed by such Buyer. 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 Underlying Shares, as applicable, issued with a restrictive legend.


 


(d)   In
addition to such Buyer’s other available remedies, the Company shall pay to a Buyer, in cash, (i) as partial liquidated
damages and not as a penalty, for each $1,000 of Underlying Shares (based on the VWAP of the Common Stock on the date such
Securities are submitted to the Transfer Agent) delivered for removal of the restrictive legend and subject to Section 4.1(c), $10
per Trading Day (increasing to $20 per Trading Day five (5) Trading Days after the Legend Removal Date) for each Trading Day after
the Legend Removal Date until such certificate (or, in the absence of certificates, book-entry) is delivered without a legend and
(ii) if the Company fails to (a) issue and deliver (or cause to be delivered) to a Buyer by the Legend Removal Date a certificate
(or, in the absence of certificates, book-entry) representing the Securities so delivered to the Company by such Buyer that is free
from all restrictive and other legends and (b) if after the Legend Removal Date such Buyer purchases (in an open market transaction
or otherwise) shares of Common Stock to deliver in satisfaction of a sale by such Buyer of all or any portion of the number of
shares of Common Stock, or a sale of a number of shares of Common Stock equal to all or any portion of the number of shares of
Common Stock that such Buyer anticipated receiving from the Company without any restrictive legend, then, an amount equal to the
excess of such Buyer’s total purchase price (including brokerage commissions and other reasonable out-of-pocket expenses, if
any) for the shares of Common Stock so purchased (including brokerage commissions and other out-of-pocket expenses, if any) (the
“Buy-In Price”) over the product of (A) such number of Underlying Shares
that the Company was required to deliver to such Buyer by the Legend Removal Date multiplied by (B) the VWAP of the Common Stock on
the date such Buyer requested the applicable removal of a legend on such Underlying Shares.


 






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(e)  
Each Buyer, severally and not jointly with the other Buyers, agrees with the Company that such Buyer will sell any Securities
pursuant to either the registration requirements of the Securities Act, including any applicable prospectus delivery requirements, or
an exemption therefrom, and that if Securities are sold pursuant to a Registration Statement, they will be sold in compliance with the
plan of distribution set forth therein, and acknowledges that the removal of the restrictive legend from certificates (or, in the absence
of certificates, book-entry) representing Securities as set forth in this Section 4.1 is predicated upon the Company’s reliance
upon this understanding.


 


4.2             
Acknowledgment of Dilution. The Company acknowledges that the issuance of the Securities may result in dilution of the
outstanding shares of Common Stock, which dilution may be substantial under certain market conditions. The Company further acknowledges
that its obligations under the Transaction Documents, including, without limitation, its obligation to issue the Underlying Shares pursuant
to the Transaction Documents, are unconditional and absolute and not subject to any right of set off, counterclaim, delay or reduction,
regardless of the effect of any such dilution or any claim the Company may have against any Buyer and regardless of the dilutive effect
that such issuance may have on the ownership of the other stockholders of the Company.


 


4.3             
Furnishing of Information. Until the earlier of the time that (i) no Buyer owns Securities or (ii) the Warrants have expired,
the Company covenants to maintain the registration of the Common Stock under Section 12(b) or 12(g) of the Exchange Act and to timely
file (or obtain extensions in respect thereof and file within the applicable grace period) all reports required to be filed by the Company
after the date hereof pursuant to the Exchange Act even if the Company is not then subject to the reporting requirements of the Exchange
Act.


 


4.4              Integration.
The Company shall not sell, offer for sale or solicit offers to buy or otherwise negotiate in respect of any security (as defined in
Section 2 of the Securities Act) that would be integrated with the offer or sale of the Securities in a manner that would require
the registration under the Securities Act of the sale of the Securities or that would be integrated with the offer or sale of the
Securities for purposes of the rules and regulations of any Trading Market such that it would require shareholder approval prior to
the closing of such other transaction unless shareholder approval is obtained before the closing of such subsequent transaction.


 






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4.5             
Conversion and Exercise Procedures. Each of the form of Notice of Exercise included in the Warrants and the form of Notice
of Conversion included in the Notes set forth the totality of the procedures required of the Buyers in order to exercise the Warrants
or convert the Notes. Without limiting the preceding sentences, no ink-original Notice of Exercise or Notice of Conversion shall be required,
nor shall any medallion guarantee (or other type of guarantee or notarization) of any Notice of Exercise or Notice of Conversion form
be required in order to exercise the Warrants or convert the Notes. No additional legal opinion, other information or instructions shall
be required of the Buyers to exercise their Warrants or convert their Notes. The Company shall honor exercises of the Warrants and conversions
of the Notes and shall deliver Underlying Shares in accordance with the terms, conditions and time periods set forth in the Transaction
Documents.


 


4.6             
Securities Laws Disclosure; Publicity. The Company shall (a) by the Disclosure Time, issue a press release disclosing the
material terms of the transactions contemplated hereby, and (b) file a Current Report on Form 8-K, including the Transaction Documents
as exhibits thereto, with the Commission within the time required by the Exchange Act. From and after the issuance of such press release,
the Company represents to the Buyers that it shall have publicly disclosed all material, non-public information delivered to any of the
Buyers by the Company or any of its Subsidiaries, or any of their respective officers, directors, employees, Affiliates or agents, in
connection with the transactions contemplated by the Transaction Documents. In addition, effective upon the issuance of such press release,
the Company acknowledges and agrees that any and all confidentiality or similar obligations under any agreement, whether written or oral,
between the Company, any of its Subsidiaries or any of their respective officers, directors, agents, employees, Affiliates or agents,
on the one hand, and any of the Buyers or any of their Affiliates on the other hand, shall terminate and be of no further force or effect.
The Company understands and confirms that each Buyer shall be relying on the foregoing covenant in effecting transactions in securities
of the Company. The Company and each Buyer shall consult with each other in issuing any other press releases with respect to the transactions
contemplated hereby, and neither the Company nor any Buyer shall issue any such press release nor otherwise make any such public statement
without the prior consent of the Company, with respect to any press release of any Buyer, or without the prior consent of each Buyer,
with respect to any press release of the Company, which consent shall not unreasonably be withheld or delayed, except if such disclosure
is required by law, in which case the disclosing party shall promptly provide the other party with prior notice of such public statement
or communication. Notwithstanding the foregoing, the Company shall not publicly disclose the name of any Buyer, or include the name of
any Buyer in any filing with the Commission or any regulatory agency or Trading Market, without the prior written consent of such Buyer,
except (a) as required by federal securities law or rule or form promulgated thereunder in connection with (i) any registration statement
contemplated by the Registration Rights Agreement and (ii) the filing of final Transaction Documents with the Commission and (b) to the
extent such disclosure is required by law or rule or form promulgated thereunder or Trading Market regulations, in which case the Company
shall provide the Buyers with prior notice of such disclosure permitted under this clause (b) and reasonably cooperate with such Buyer
regarding such disclosure.


 






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4.7             
 Shareholder Rights Plan. No claim will be made or enforced by the Company or, with the consent of the Company, any other
Person, that any Buyer is an “Acquiring Person” under any control share acquisition, business combination, poison
pill (including any distribution under a rights agreement) or similar anti-takeover plan or arrangement in effect or hereafter adopted
by the Company, or that any Buyer could be deemed to trigger the provisions of any such plan or arrangement, by virtue of receiving Securities
under the Transaction Documents or under any other agreement between the Company and the Buyers.


 


4.8             
Non-Public Information. Except with respect to the material terms and conditions of the transactions contemplated by the
Transaction Documents, which shall be disclosed pursuant to Section 4.6, the Company covenants and agrees that neither it, nor any other
Person acting on its behalf will provide any Buyer or its agents or counsel with any information that constitutes, or the Company reasonably
believes constitutes, material non-public information, unless prior thereto such Buyer shall have consented in writing to the receipt
of such information and agreed in writing with the Company to keep such information confidential. The Company understands and confirms
that each Buyer shall be relying on the foregoing covenant in effecting transactions in securities of the Company. To the extent that
the Company, any of its Subsidiaries, or any of their respective officers, director, agents, employees or Affiliates delivers any material,
non-public information to a Buyer without such Buyer’s consent, the Company hereby covenants and agrees that such Buyer shall not
have any duty of confidentiality to the Company, any of its Subsidiaries, or any of their respective officers, directors, employees,
Affiliates, or agents, or a duty to the Company, any of its Subsidiaries or any of their respective officers, directors, employees, Affiliates
or agents, not to trade on the basis of, such material, non-public information, provided that the Buyer shall remain subject to applicable
law. To the extent that any notice provided pursuant to any Transaction Document constitutes, or contains, material, non-public information
regarding the Company or any Subsidiaries, unless the applicable Buyer has consented in writing to the non-disclosure of such material
non-public information (but only to the extent of the period of non-disclosure agreed upon by such Buyer and the Company), the Company
shall simultaneously with the delivery of such notice file such notice with the Commission pursuant to a Current Report on Form 8-K.
The Company understands and confirms that each Buyer shall be relying on the foregoing covenant in effecting transactions in securities
of the Company.


 


4.9             
Use of Proceeds. The Company shall use the net proceeds from the sale of the Securities hereunder for general corporate
purposes, including working capital, acquisitions, and capital expenditures, and shall not use such proceeds: (a) except as set forth
on Schedule 4.9 attached hereto, for the satisfaction of any portion of the Company’s debt (other than payment of trade
payables in the ordinary course of the Company’s business and prior practices), (b) for the redemption of any Common Stock or Common
Stock Equivalents, (c) for the settlement of any outstanding litigation or (d) in violation of FCPA or OFAC regulations.


 






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4.10          Indemnification
of Buyers. Subject to the provisions of this Section 4.10, the Company will indemnify and hold each Buyer and its directors,
officers, shareholders, members, partners, employees and agents (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), each Person who controls such Buyer (within the
meaning of Section 15 of the Securities Act and Section 20 of the Exchange Act), and the directors, officers, shareholders, agents,
members, partners or 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 such controlling persons (each, a “Buyer Party”)
harmless from any and all losses, liabilities, obligations, claims, contingencies, damages, costs and expenses, including all
judgments, amounts paid in settlements, court costs and reasonable attorneys’ fees and costs of investigation that any such
Buyer Party may suffer or incur as a result of or relating to (a) any breach of any of the representations, warranties, covenants or
agreements made by the Company in this Agreement or in the other Transaction Documents or (b) any action instituted against the
Buyer Parties in any capacity, or any of them or their respective Affiliates, by any stockholder of the Company who is not an
Affiliate of such Buyer Party, with respect to any of the transactions contemplated by the Transaction Documents (unless such action
is solely based upon a material breach of such Buyer Party’s representations, warranties or covenants under the Transaction
Documents or any agreements or understandings such Buyer Party may have with any such stockholder or any violations by such Buyer
Party of state or federal securities laws or any conduct by such Buyer Party which is finally judicially determined to constitute
fraud, gross negligence or willful misconduct). If any action shall be brought against any Buyer Party in respect of which indemnity
may be sought pursuant to this Agreement, such Buyer Party shall promptly notify the Company in writing, and the Company shall have
the right to assume the defense thereof with counsel of its own choosing reasonably acceptable to the Buyer Party. Any Buyer Party
shall have the right to employ separate counsel in any such action and participate in the defense thereof, but the fees and expenses
of such counsel shall be at the expense of such Buyer Party except to the extent that (i) the employment thereof has been
specifically authorized by the Company in writing, (ii) the Company has failed after a reasonable period of time to assume such
defense and to employ counsel or (iii) in such action there is, in the reasonable opinion of counsel, a material conflict on any
material issue between the position of the Company and the position of such Buyer Party, in which case the Company shall be
responsible for the reasonable fees and expenses of no more than one such separate counsel. The Company will not be liable to any
Buyer Party under this Agreement (y) for any settlement by a Buyer Party effected without the Company’s prior written consent,
which shall not be unreasonably withheld or delayed; or (z) to the extent, but only to the extent that a loss, claim, damage or
liability is primarily attributable to any Buyer Party’s breach of any of the representations, warranties, covenants or
agreements made by such Buyer Party in this Agreement or in the other Transaction Documents or any conduct by a Buyer Party which is
finally judicially determined to constitute fraud, gross negligence or willful misconduct or a violation of applicable securities
laws. The indemnification required by this Section 4.10 shall be made by periodic payments of the amount thereof during the course
of the investigation or defense, as and when bills are received or are incurred; provided, that if any Buyer Party is finally
judicially determined not to be entitled to indemnification or payment under this Section 4.10, such Buyer Party shall promptly
reimburse the Company for any payments that are advanced under this sentence. The indemnity agreements contained herein shall be in
addition to any cause of action or similar right of any Buyer Party against the Company or others and any liabilities the Company
may be subject to pursuant to law.


 


4.11         
Reservation and Listing of Securities.


 


(a)  
The Company shall maintain a reserve of the Required Reserve Amount from its duly authorized shares of Common Stock for issuance
pursuant to the Transaction Documents in such amount as may then be required to fulfill its obligations in full under the Transaction
Documents.


 






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(b)  
 If, on any date, the number of authorized but unissued (and otherwise unreserved) shares of Common Stock is less than the Required
Reserve Amount on such date, then the Board of Directors shall use its reasonable best efforts to amend the Company’s certificate
or articles of incorporation to increase the number of authorized but unissued shares of Common Stock to at least the Required Reserve
Amount at such time, as soon as possible and in any event not later than the 75th day after such date.


 


(c)  
The Company shall, if applicable: (i) in the time and manner required by the principal Trading Market, prepare and file with such
Trading Market an additional shares listing application covering a number of shares of Common Stock at least equal to the Required Reserve
Amount on the date of such application, (ii) take all steps necessary to cause such shares of Common Stock to be approved for listing
or quotation on such Trading Market as soon as possible thereafter, (iii) provide to the Buyers evidence of such listing or quotation
and (iv) maintain the listing or quotation of such Common Stock on any date at least equal to the Required Reserve Amount on such date
on such Trading Market or another Trading Market. The Company agrees to maintain the eligibility of the Common Stock for electronic transfer
through the Depository Trust Company or another established clearing corporation, including, without limitation, by timely payment of
fees to the Depository Trust Company or such other established clearing corporation in connection with such electronic transfer.


 


4.12         
Participation in Future Financing.


 


(a)  
From the date hereof until the later of (x) March 15, 2025 and (y) the 12 month anniversary of the date no Notes remain outstanding,
upon any issuance by the Company or any of its Subsidiaries of Common Stock or Common Stock Equivalents for cash consideration, Indebtedness
or a combination of units thereof (a “Subsequent Financing”), the Buyers in the aggregate shall have the right to
participate in up to an amount of the Subsequent Financing equal to 22.5% of the Subsequent Financing (the “Participation Maximum”)
on the same terms, conditions and price provided for in the Subsequent Financing.


 


(b)  
At least five (5) Trading Days prior to the closing of the Subsequent Financing, the Company shall deliver to each Buyer a written
notice of its intention to effect a Subsequent Financing (“Pre-Notice”), which Pre-Notice shall ask such Buyer if
it wants to review the details of such financing (such additional notice, a “Subsequent Financing Notice”). Upon the
request of a Buyer, and only upon a request by such Buyer, for a Subsequent Financing Notice, the Company shall promptly, but no later
than one (1) Trading Day after such request, deliver a Subsequent Financing Notice to such Buyer. The Subsequent Financing Notice shall
describe in reasonable detail the proposed terms of such Subsequent Financing, the amount of proceeds intended to be raised thereunder
and the Person or Persons through or with whom such Subsequent Financing is proposed to be effected and shall include a term sheet or
similar document relating thereto as an attachment.


 


(c)   Any
Buyer desiring to participate in such Subsequent Financing must provide written notice to the Company by not later than 5:30 p.m.
(New York City time) on the third (3rd) Trading Day after all of the Buyers have received the Pre-Notice that such Buyer is willing
to participate in the Subsequent Financing, the amount of such Buyer’s participation, and representing and warranting that
such Buyer has such funds ready, willing, and available for investment on the terms set forth in the Subsequent Financing Notice. If
the Company receives no such notice from a Buyer as of such third (3rd) Trading Day, such Buyer shall be deemed to have
notified the Company that it does not elect to participate in such Subsequent Financing.


 






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(d)  
If by 5:30 p.m. (New York City time) on the third (3rd ) Trading Day after all of the Buyers have received the Pre-Notice, notifications
by the Buyers of their willingness to participate in the Subsequent Financing (or to cause their designees to participate) is, in the
aggregate, less than the Participant Maximum of the Subsequent Financing, then the Company may effect the remaining portion of the Participant
Maximum of such Subsequent Financing on the terms and with the Persons set forth in the Subsequent Financing Notice.


 


(e)  
If by 5:30 p.m. (New York City time) on the third (3rd ) Trading Day after all of the Buyers have received the Pre-Notice, the
Company receives responses to a Subsequent Financing Notice from Buyers seeking to purchase more than the aggregate amount of the Participation
Maximum, each such Buyer shall have the right to purchase its Pro Rata Portion (as defined below) of the Participation Maximum. 
“Pro Rata Portion” means the ratio of (x) the Subscription Amount of Securities purchased on the Closing Date by a
Buyer participating under this Section 4.12 and (y) the sum of the aggregate Subscription Amounts of Securities purchased on the Closing
Date by all Buyers participating under this Section 4.12.


 


(f)   
The Company must provide the Buyers with a second Subsequent Financing Notice, and the Buyers will again have the right of participation
set forth above in this Section 4.12, if the Subsequent Financing subject to the initial Subsequent Financing Notice is not consummated
for any reason on the terms set forth in such Subsequent Financing Notice within thirty (30) Trading Days after the date of delivery
of the initial Subsequent Financing Notice.


 


(g)  
The Company and each Buyer agree that if any Buyer elects to participate in the Subsequent Financing, the transaction documents
related to the Subsequent Financing shall not include any term or provision that, directly or indirectly, will, or is intended to, exclude
one or more of the Buyers from participating in a Subsequent Financing, including, but not limited to, provisions whereby such Buyer
shall be required to agree to any restrictions on trading as to any securities of the Company or be required to consent to any amendment
to or termination of, or grant any waiver, release or the like under or in connection with, this Agreement, without the prior written
consent of such Buyer.


 


(h)   Notwithstanding
anything to the contrary in this Section 4.12 and unless otherwise agreed to by such Buyer, the Company shall either confirm in
writing to such Buyer that the transaction with respect to the Subsequent Financing has been abandoned or shall publicly disclose
its intention to issue the securities in the Subsequent Financing, in either case in such a manner such that such Buyer will not be
in possession of any material, non-public information, by the tenth (10th) Business Day following delivery of the Subsequent
Financing Notice. If by such tenth (10th) Business Day, no public disclosure regarding a transaction with respect to the Subsequent
Financing has been made, and no notice regarding the abandonment of such transaction has been received by such Buyer, such
transaction shall be deemed to have been abandoned and such Buyer shall not be deemed to be in possession of any material,
non-public information with respect to the Company or any of its Subsidiaries.


 


(i)    
Notwithstanding the foregoing, this Section 4.12 shall not apply in respect of an Exempt Issuance.




 






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4.13         
Subsequent Equity Sales.


 


(a)              
From the date hereof until 90 calendar days after the Effective Date, neither the Company nor any Subsidiary shall (i) issue,
enter into any agreement to issue or announce the issuance or proposed issuance of any shares of Common Stock or Common Stock Equivalents,
other than in connection with the Permitted Equity Line, the Permitted ATM or the issuance of stock options or restricted shares under
the Company’s equity incentive plans, or (ii) file any registration statement or any amendment or supplement thereto, in each case
other than as contemplated pursuant to the Registration Rights Agreement.


 


(b)              
From the date hereof until such time as no Buyer holds any of the Warrants, other than a new or existing (A) equity line of credit
offering program under Rule 415 with B. Riley Financial, Inc. (or its broker-dealer subsidiary) (including any Additional Permitted Equity
Line (as defined below), the “Permitted Equity Line”) or (B) an at-the-market offering program under Rule 415 with
B. Riley Financial, Inc. (or its broker-dealer subsidiary) or any other sales agent that is a bona fide broker dealer (the “Permitted
ATM”), the Company shall be prohibited from effecting or entering into an agreement to effect any issuance by the Company or
any of its Subsidiaries of Common Stock or Common Stock Equivalents (or a combination of units thereof) involving a Variable Rate Transaction.
“Variable Rate Transaction” means a transaction in which the Company (i) issues or sells any debt or equity securities
that are convertible into, exchangeable or exercisable for, or include the right to receive, additional shares of Common Stock either
(A) at a conversion price, exercise price or exchange rate or other price that is based upon, and/or varies with, the trading prices
of or quotations for the shares of Common Stock at any time after the initial issuance of such debt or equity securities or (B) with
a conversion, exercise or exchange price that is subject to being reset at some future date after the initial issuance of such debt or
equity security or upon the occurrence of specified or contingent events directly or indirectly related to the business of the Company
or the market for the Common Stock or (ii) enters into, or effects a transaction under, any agreement, including, but not limited to,
an equity line of credit or an “at-the-market offering”, whereby the Company may issue securities at a future determined
price; provided, the Company may enter into (and/or issue securities pursuant to) a Permitted Equity Line or Permitted ATM. Any Buyer
shall be entitled to obtain injunctive relief against the Company to preclude any such issuance, which remedy shall be in addition to
any right to collect damages.


 






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(c)  
 Unless Stockholder Approval has been obtained and deemed effective, neither the Company nor any Subsidiary shall make any issuance
whatsoever of Common Stock or Common Stock Equivalents which would cause any adjustment of the Conversion Price to the extent the holders
of Notes would not be permitted, pursuant to Section 3(d)(ii) of the Notes, to convert their respective outstanding Notes and exercise
their respective Warrants in full, ignoring for such purposes the other conversion or exercise limitations therein. Any Buyer shall be
entitled to obtain injunctive relief against the Company to preclude any such issuance, which remedy shall be in addition to any right
to collect damages.


 


(d)  
The Company shall not consummate a Dilutive Issuance (as defined in the Notes) prior to the Stockholder Approval Date (as defined
below).


 


(e)  
Notwithstanding the foregoing, this Section 4.13 shall not apply in respect of an Exempt Issuance, except that no Variable Rate
Transaction shall be an Exempt Issuance.


 


4.14         
Equal Treatment of Buyers. No consideration (including any modification of any Transaction Document) shall be offered or
paid to any Person to amend or consent to a waiver or modification of any provision of the Transaction Documents unless the same consideration
is also offered to all of the parties to such Transaction Documents. Further, the Company shall not make any payment of principal or
interest on the Notes in amounts which are disproportionate to the respective principal amounts outstanding on the Notes at any applicable
time. For clarification purposes, this provision constitutes a separate right granted to each Buyer by the Company and negotiated separately
by each Buyer, and is intended for the Company to treat the Buyers as a class and shall not in any way be construed as the Buyers acting
in concert or as a group with respect to the purchase, disposition or voting of Securities or otherwise.


 


4.15          Certain
Transactions and Confidentiality. Each Buyer, severally and not jointly with the other Buyers, covenants that neither it, nor
any Affiliate acting on its behalf or pursuant to any understanding with it will execute any purchases or sales, including Short
Sales, of any of the Company’s securities during the period commencing with the execution of this Agreement and ending at such
time that the transactions contemplated by this Agreement are first publicly announced pursuant to the initial press release as
described in Section 4.6.  Each Buyer, severally and not jointly with the other Buyers, covenants that until such time as the
transactions contemplated by this Agreement are publicly disclosed by the Company pursuant to the initial press release as described
in Section 4.6, such Buyer will maintain the confidentiality of the existence and terms of this transaction and the information
included in the Disclosure Schedules (other than as disclosed to its legal and other representatives). Notwithstanding the
foregoing, and notwithstanding anything contained in this Agreement to the contrary, the Company expressly acknowledges and agrees
that (i) no Buyer makes any representation, warranty or covenant hereby that it will not engage in effecting transactions in any
securities of the Company after the time that the transactions contemplated by this Agreement are first publicly announced pursuant
to the initial press release as described in Section 4.6, (ii) no Buyer shall be restricted or prohibited from effecting any
transactions in any securities of the Company in accordance with applicable securities laws from and after the time that the
transactions contemplated by this Agreement are first publicly announced pursuant to the initial press release as described in
Section 4.6 and (iii) no Buyer shall have any duty of confidentiality or duty not to trade in the securities of the Company to the
Company, any of its Subsidiaries, or any of their respective officers, directors, employees, Affiliates or agent, after the issuance
of the initial press release as described in Section 4.6.  Notwithstanding the foregoing, in the case of a Buyer that is a
multi-managed investment vehicle whereby separate portfolio managers manage separate portions of such Buyer’s assets and the
portfolio managers have no direct knowledge of the investment decisions made by the portfolio managers managing other portions of
such Buyer’s assets, the covenant set forth above shall only apply with respect to the portion of assets managed by the
portfolio manager that made the investment decision to purchase the Securities covered by this Agreement.


 






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4.16         
Form D; Blue Sky Filings. The Company agrees to timely file a Form D with respect to the Securities as required under Regulation
D and to provide a copy thereof, promptly upon request of any Buyer. The Company shall take such action as the Company shall reasonably
determine is necessary in order to obtain an exemption for, or to qualify the Securities for, sale to the Buyers at the Closing under
applicable securities or “Blue Sky” laws of the states of the United States, and shall provide evidence of such actions promptly
upon request of any Buyer.


 


4.17         
Capital Changes. Until the one year anniversary of the Effective Date, the Company shall not undertake a reverse or forward
stock split or reclassification of the Common Stock without the prior written consent of the Buyers holding a majority in principal amount
outstanding of the Notes (except as necessary to remain on a Trading Market).


 


4.18         
Voting Agreements. The Company shall not amend, modify, waive or terminate any provision of any of the Voting Agreements
except to extend the term of the lock-up period and shall enforce the provisions of each Voting Agreement in accordance with its terms.
If any party to a Voting Agreement breaches any provision of a Voting Agreement, the Company shall promptly use its best efforts to seek
specific performance of the terms of such Voting Agreement. Notwithstanding the foregoing, no Buyer shall be a third party beneficiary
of any Voting Agreement.


 


4.19          No
Net Short Position. Each Buyer hereby agrees solely with the Company, severally and not jointly, and not with any other Buyer,
for so long as such Buyer owns any Notes, such Buyer shall not maintain a Net Short Position (as defined below). For purposes
hereof, a “Net Short Position” by a person means a position whereby such person has executed one or more sales of
Common Stock that is marked as a short sale (but not including any sale marked “short exempt”) and that is executed at a
time when such Buyer has no equivalent offsetting long position in the Common Stock (or is deemed to have a long position hereunder
or otherwise in accordance with Regulation SHO of the 1934 Act); provided, that, for purposes of such calculations, any short sales
either (x) consummated at a price greater than or equal to (A) the Conversion Price, (y) that is a result of a bona-fide trading
error on behalf of such Buyer (or its affiliates) or (z) that would otherwise be marked as a “long” sale, but for the
occurrence of a Conversion Failure (as defined in the Notes), a Delivery Failure (as defined in the Warrants), an Equity Conditions
Failure (as defined in the Notes) and/or any other breach by the Company (or its affiliates or agents, including, without
limitation, the Transfer Agent) of any Transaction Document, in each case, shall be excluded from such calculations. For purposes of
determining whether a Buyer has an equivalent offsetting “long” position in the Common Stock, (A) all Common Stock that
is owned by such Buyer shall be deemed held “long” by such Buyer, (B) all Common Stock that would be issuable upon
conversion or exercise in full of all Securities issuable to such Buyer or then held by such Buyer, as applicable (assuming that
such Securities were then fully convertible or exercisable, notwithstanding any provisions to the contrary, and giving effect to any
conversion or exercise price adjustments that would take effect given only the passage of time) shall be deemed to be held long by
such Buyer, and (C) at any other time the Company is required (or has elected (or is deemed to have elected)) to issue shares of
Common Stock to such Buyer pursuant to the terms of the Notes and/or the Warrants, as applicable, any shares of Common Stock issued
or issuable to such Buyer (or its designee, if applicable) in connection therewith shall be deemed held “long” by such
Buyer from and after the date that is two (2) Trading Days prior to the deadline for delivery of such shares of Common Stock to such
Buyer, as set forth in the Notes and/or the Warrants, as applicable, until such time as such Buyer shall no longer beneficially own
such shares of Common Stock.


 






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4.20         
Stockholder Approval.


 


(a)   Permitted
Equity Line Stockholder Approval. At all times the Company has not satisfied the Excess Cash Condition (as defined in the Notes)
and any Notes remain outstanding, the Company shall have the ability to issue up to the greater of (x) the aggregate amounts then
outstanding under the Notes and (y) the difference of (A) $10 million less (B) the amount of Available Cash (as defined in the
Notes) of the Company in excess of $3 million, as applicable, in shares of Common Stock pursuant to a Permitted Equity Line and/or
the Permitted ATM without violating the rules and regulations of the Principal Market and the rules and regulations of the
Commission) (the “Market Issuance Availability Condition”). If at any time after the date hereof, any Notes
remain outstanding and the Market Issuance Availability Condition is not satisfied, the Company shall deliver written notice to the
Buyers and, if requested by the Buyers in writing (the “EL Approval Request Date”), the Company shall use its
reasonable best efforts to obtain (or be permitted to use) a Permitted Equity Line that will satisfy the Market Issuance
Availability Condition (the “Additional Permitted Equity Line”) and, if the approval of the stockholders of the
Company is necessary to issue such aggregate number of shares of Common Stock pursuant to such Additional Permitted Equity Line
necessary to satisfy the Market Issuance Availability Condition, the Company shall provide each stockholder entitled to vote at a
special meeting of stockholders of the Company (the “EL Stockholder Meeting”), which shall be promptly called and
held not later than the sixtieth (60th) calendar day after the EL Approval Request Date (the “EL Stockholder
Meeting Deadline”), a proxy statement, in each case, in a form reasonably acceptable to the Buyers and Kelley Drye &
Warren LLP, at the expense of the Company, with the Company obligated to reimburse the expenses of Kelley Drye & Warren LLP
incurred in connection therewith in an amount not exceed $5,000. The proxy statement, if any, shall solicit each of the
Company’s stockholder’s affirmative vote at the EL Stockholder Meeting for approval of resolutions (“EL
Stockholder Resolutions”) providing for the approval of the issuance of all of the shares of Common Stock issued and
issuable pursuant to such Additional Permitted Equity Line in compliance with the rules and regulations of the Company’s
principal Trading Market (such affirmative approval being referred to herein as the “EL Stockholder Approval”,
and the date such EL Stockholder Approval is obtained, the “EL Stockholder Approval Date”), and the Company shall
use its reasonable best efforts to solicit its stockholders’ approval of such resolutions and to cause the Board of Directors
of the Company to recommend to the stockholders that they approve such resolutions. The Company shall be obligated to seek to obtain
the EL Stockholder Approval by the EL Stockholder Meeting Deadline. If, despite the Company’s reasonable best efforts the EL
Stockholder Approval is not obtained on or prior to the EL Stockholder Meeting Deadline, the Company shall cause an additional
Stockholder Meeting to be held on or prior to three-month anniversary of the EL Stockholder Meeting Deadline. If, despite the
Company’s reasonable best efforts the EL Stockholder Approval is not obtained after such subsequent stockholder meetings, the
Company shall cause an additional Stockholder Meeting to be held semi-annually thereafter until such EL Stockholder Approval is
obtained; provided that, if applicable, the Company’s obligation to hold additional EL Stockholder Meetings to obtain the EL
Stockholder Approval shall terminate on the date no Notes or Warrants remain outstanding.


 






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(b)  
Stockholder Approval of Securities. The Company shall provide each stockholder entitled to vote at a special meeting of
stockholders of the Company (the “Stockholder Meeting”), which shall be promptly called and held not later than the
earlier to occur of (i) the date of a stockholder meeting with respect to the Permitted Equity Line set forth in clause (a) above, (ii)
the forty-fifth (45th) day after the initial date after the date hereof (if any) that the market capitalization of the Company
is less than $50 million and (iii) the first annual meeting of stockholders occurring after the date hereof (the “Stockholder
Meeting Deadline”), a proxy statement, in each case, in a form reasonably acceptable to the Buyers and Kelley Drye & Warren
LLP, at the expense of the Company, with the Company obligated to reimburse the expenses of Kelley Drye & Warren LLP incurred in
connection therewith in an amount not exceed $5,000. The proxy statement, if any, shall solicit each of the Company’s stockholder’s
affirmative vote at the Stockholder Meeting for approval of resolutions (“Stockholder Resolutions”) providing for
the approval of the issuance of all of the Securities in compliance with the rules and regulations of the Company’s principal Trading
Market (without regard to any limitations on conversion or exercise set forth in the Notes or Warrants, respectively) (such affirmative
approval being referred to herein as the “Stockholder Approval”, and the date such Stockholder Approval is obtained,
the “Stockholder Approval Date”), and the Company shall use its reasonable best efforts to solicit its stockholders’
approval of such resolutions and to cause the Board of Directors of the Company to recommend to the stockholders that they approve such
resolutions. The Company shall be obligated to seek to obtain the Stockholder Approval by the Stockholder Meeting Deadline. If, despite
the Company’s reasonable best efforts the Stockholder Approval is not obtained on or prior to the Stockholder Meeting Deadline,
the Company shall cause an additional Stockholder Meeting to be held on or prior to three month anniversary of the Stockholder Meeting
Deadline. If, despite the Company’s reasonable best efforts the Stockholder Approval is not obtained after such subsequent stockholder
meetings, the Company shall cause an additional Stockholder Meeting to be held semi-annually thereafter until such Stockholder Approval
is obtained; provided that, if applicable, the Company’s obligation to hold additional Stockholder Meetings to obtain the Stockholder
Approval shall terminate on the date no Notes or Warrants remain outstanding.


 


4.21         
Closing Documents. On or prior to thirty (30) Business Days after the Closing Date, the Company agrees to deliver, or cause
to be delivered, to each Buyer and KDW a complete electronic closing set of the executed Transaction Documents, Securities and any other
document required to be delivered to any party pursuant to this Agreement.


 


4.22          Collateral
Agent. Each Buyer hereby (i) appoints Alto Opportunity Master Fund, SPC - Segregated Master Portfolio B, as the collateral agent
hereunder and under the Security Documents (in such capacity, the “Collateral Agent”), and (ii) authorizes the
Collateral Agent (and its officers, directors, employees and agents) to take such action on such Buyer’s behalf in accordance
with the terms hereof and thereof. The Collateral Agent shall not have, by reason hereof or any of the other Security Documents, a
fiduciary relationship in respect of any Buyer. Neither the Collateral Agent nor any of its officers, directors, employees or agents
shall have any liability to any Buyer for any action taken or omitted to be taken in connection hereof or any other Security
Document except to the extent caused by its own gross negligence or willful misconduct, and each Buyer agrees to defend, protect,
indemnify and hold harmless the Collateral Agent and all of its officers, directors, employees and agents (collectively, the
“Collateral Agent Indemnitees”) from and against any losses, damages, liabilities, obligations, penalties,
actions, judgments, suits, fees, costs and expenses (including, without limitation, reasonable attorneys’ fees, costs and
expenses) incurred by such Collateral Agent Indemnitee, whether direct, indirect or consequential, arising from or in connection
with the performance by such Collateral Agent Indemnitee of the duties and obligations of Collateral Agent pursuant hereto or any of
the Security Documents. The Collateral Agent shall not be required to exercise any discretion or take
any action, but shall be required to act or to refrain from acting (and shall be fully protected in so acting or refraining from
acting) upon the instructions of the Required Holders, and such instructions shall be binding upon all holders of Notes; provided,
however, that the Collateral Agent shall not be required to take any action which, in the reasonable opinion of the Collateral
Agent, exposes the Collateral Agent to liability or which is contrary to this Agreement or any other Transaction Document or
applicable law. The Collateral Agent shall be entitled to rely upon any written notices, statements, certificates, orders or other
documents or any telephone message believed by it in good faith to be genuine and correct and to have been signed, sent or made by
the proper Person, and with respect to all matters pertaining to this Agreement or any of the other Transaction Documents and its
duties hereunder or thereunder, upon advice of counsel selected by it.


 






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4.23         
Successor Collateral Agent.


 


(a)  
The Collateral Agent may resign from the performance of all its functions and duties hereunder and under the other Transaction
Documents at any time by giving at least ten (10) Business Days’ prior written notice to the Company and each holder of Notes.
Such resignation shall take effect upon the acceptance by a successor Collateral Agent of appointment pursuant to clauses (b) and (c)
below or as otherwise provided below. If at any time the Collateral Agent (together with its affiliates) beneficially owns less than
$100,000 in aggregate principal amount of Notes, the Required Holders may, by written consent, remove the Collateral Agent from all its
functions and duties hereunder and under the other Transaction Documents.


 


(b)  
Upon any such notice of resignation or removal, the Required Holders shall appoint a successor collateral agent. Upon the acceptance
of any appointment as Collateral Agent hereunder by a successor agent, such successor collateral agent shall thereupon succeed to and
become vested with all the rights, powers, privileges and duties of the collateral agent, and the Collateral Agent shall be discharged
from its duties and obligations under this Agreement and the other Transaction Documents. After the Collateral Agent’s resignation
or removal hereunder as the collateral agent, the provisions of this Section 4.23 shall inure to its benefit as to any actions taken
or omitted to be taken by it while it was the Collateral Agent under this Agreement and the other Transaction Documents.


 


(c)   If
a successor collateral agent shall not have been so appointed within ten (10) Business Days of receipt of a written notice of
resignation or removal, the Collateral Agent shall then appoint a successor collateral agent who shall serve as the Collateral Agent
until such time, if any, as the Required Holders appoint a successor collateral agent as provided above.


 






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(d)  
In the event that a successor Collateral Agent is appointed pursuant to the provisions of this Section 4.23 that is not a Buyer
or an affiliate of any Buyer (or the Required Holders or the Collateral Agent (or its successor), as applicable, notify the Company that
they or it wants to appoint such a successor Collateral Agent pursuant to the terms of this Section 4.23), the Company and each Subsidiary
thereof covenants and agrees to promptly take all actions reasonably requested by the Required Holders or the Collateral Agent (or its
successor), as applicable, from time to time, to secure a successor Collateral Agent satisfactory to the requesting part(y)(ies), in
their sole discretion, including, without limitation, by paying all reasonable and customary fees and expenses of such successor Collateral
Agent, by having the Company and each Subsidiary thereof agree to indemnify any successor Collateral Agent pursuant to reasonable and
customary terms and by each of the Company and each Subsidiary thereof executing a collateral agency agreement or similar agreement and/or
any amendment to the Security Documents reasonably requested or required by the successor Collateral Agent.


 


ARTICLE V. 


MISCELLANEOUS


 


5.1             
Termination.  This Agreement may be terminated by any Buyer, as to such Buyer’s obligations hereunder only and
without any effect whatsoever on the obligations between the Company and the other Buyers, by written notice to the other parties, if
the Closing has not been consummated on or before the fifth (5th) Trading Day following the date hereof, provided,
however, that no such termination will affect the right of any party to sue for any breach by any other party (or parties).


 


5.2             
Fees and Expenses. At the Closing, the Company has agreed to pay KDW the non-accountable sum of $75,000 for its legal fees
and expenses, $50,000 of which has been paid prior to the Closing. Accordingly, in lieu of the foregoing payments, the aggregate amount
that the lead investor is to pay for the Securities at the Closing shall be reduced by $25,000 in lieu thereof. Except as expressly set
forth in the Transaction Documents to the contrary, each party shall pay the fees and expenses of its advisers, counsel, accountants
and other experts, if any, and all other expenses incurred by such party incident to the negotiation, preparation, execution, delivery
and performance of this Agreement. The Company shall pay all Transfer Agent fees (including, without limitation, any fees required for
same-day processing of any instruction letter delivered by the Company and any conversion or exercise notice delivered by a Buyer), stamp
taxes and other taxes and duties levied in connection with the delivery of any Securities to the Buyers.


 


5.3             
Entire Agreement. The Transaction Documents, together with the exhibits and schedules thereto, contain the entire understanding
of the parties with respect to the subject matter hereof and thereof and supersede all prior agreements and understandings, oral or written,
with respect to such matters, which the parties acknowledge have been merged into such documents, exhibits and schedules.


 


5.4              Notices.
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 time of transmission, if such notice or communication is delivered
via email attachment 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 time of transmission, if such notice or communication is delivered
via email attachment 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.


 






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5.5             
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 Buyers which purchased at least 50.1% in interest of the Notes based
on the initial Subscription Amounts hereunder (or, prior to the Closing, the Company and each Buyer) (as applicable, the “Required
Holders”) or, in the case of a waiver, by the party against whom enforcement of any such waived provision is sought, provided
that if any amendment, modification or waiver disproportionately and adversely impacts a Buyer (or group of Buyers), the consent of such
disproportionately impacted Buyer (or group of Buyers) shall also be required; provided, that Sections 4.22 and 4.33 may not be amended,
modified or waived without the written consent of the Collateral Agent. 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. Any proposed amendment or waiver that disproportionately, materially and adversely
affects the rights and obligations of any Buyer relative to the comparable rights and obligations of the other Buyers shall require the
prior written consent of such adversely affected Buyer. Any amendment effected in accordance with this Section 5.5 shall be binding upon
each Buyer and holder of Securities and the Company.


 


5.6             
Headings. The headings herein are for convenience only, do not constitute a part of this Agreement and shall not be deemed
to limit or affect any of the provisions hereof.


 


5.7             
Successors and Assigns. 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 Buyer (other than by merger). Any Buyer may assign any or all of its rights under this Agreement to any Person to whom such Buyer
assigns or transfers any Securities, provided that such transferee agrees in writing to be bound, with respect to the transferred Securities,
by the provisions of the Transaction Documents that apply to the “Buyers.”


 


5.8             
No Third Party Beneficiaries. This Agreement is intended for the benefit of the parties hereto and their respective successors
and permitted assigns and is not for the benefit of, nor may any provision hereof be enforced by, any other Person, except as otherwise
set forth in Section 4.10.


 


5.9              Governing
Law. All questions concerning the construction, validity, enforcement and interpretation of the Transaction Documents 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 and any other Transaction Documents (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 any of the Transaction Documents), 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 the Transaction Documents, then, in addition to the obligations of the Company under
Section 4.10, 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.


 






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5.10         
Survival. The representations and warranties contained herein shall survive the Closing and the delivery of the Securities.


 


5.11         
Execution. 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 each other party,
it being understood that the parties need not sign the same counterpart. In the event that any signature is delivered 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 “.pdf” signature page were an original thereof.


 


5.12         
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.


 


5.13          Rescission
and Withdrawal Right. Notwithstanding anything to the contrary contained in (and without limiting any similar provisions of) any
of the other Transaction Documents, whenever any Buyer exercises a right, election, demand or option under a Transaction Document
and the Company does not timely perform its related obligations within the periods therein provided, then such Buyer may rescind or
withdraw, in its sole discretion from time to time upon written notice to the Company, any relevant notice, demand or election in
whole or in part without prejudice to its future actions and rights; provided, however, that, in the case of a
rescission of a conversion of a Note or exercise of a Warrant, the applicable Buyer shall be required to return any shares of Common
Stock subject to any such rescinded conversion or exercise notice concurrently with the return to such Buyer of the aggregate
exercise price paid to the Company for such shares and the restoration of such Buyer’s right to acquire such shares pursuant
to such Buyer’s Warrant (including, issuance of a replacement warrant certificate evidencing such restored right).


 






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5.14         
Replacement of Securities. If any certificate or instrument evidencing any Securities is mutilated, lost, stolen or destroyed,
the Company shall issue or cause to be issued in exchange and substitution for and upon cancellation thereof (in the case of mutilation),
or in lieu of and substitution therefor, a new certificate or instrument, but only upon receipt of evidence reasonably satisfactory to
the Company of such loss, theft or destruction. The applicant for a new certificate or instrument under such circumstances shall also
pay any reasonable third-party costs (including customary indemnity) associated with the issuance of such replacement Securities.


 


5.15         
Remedies. In addition to being entitled to exercise all rights provided herein or granted by law, including recovery of
damages, each of the Buyers and the Company will be entitled to specific performance under the Transaction Documents. The parties agree
that monetary damages may not be adequate compensation for any loss incurred by reason of any breach of obligations contained in the
Transaction Documents and hereby agree to waive and not to assert in any Action for specific performance of any such obligation the defense
that a remedy at law would be adequate.


 


5.16         
Payment Set Aside. To the extent that the Company makes a payment or payments to any Buyer pursuant to any Transaction
Document or a Buyer enforces or exercises its rights thereunder, and such payment or payments or the proceeds of such enforcement or
exercise or any part thereof are subsequently invalidated, declared to be fraudulent or preferential, set aside, recovered from, disgorged
by or are required to be refunded, repaid or otherwise restored to the Company, a trustee, receiver or any other Person under any law
(including, without limitation, any bankruptcy law, state or federal law, common law or equitable cause of action), then to the extent
of any such restoration the obligation or part thereof originally intended to be satisfied shall be revived and continued in full force
and effect as if such payment had not been made or such enforcement or setoff had not occurred.


 


5.17         
Usury. To the extent it may lawfully do so, the Company hereby agrees not to insist upon or plead or in any manner whatsoever
claim, and will resist any and all efforts to be compelled to take the benefit or advantage of, usury laws wherever enacted, now or at
any time hereafter in force, in connection with any Action or Proceeding that may be brought by any Buyer in order to enforce any right
or remedy under any Transaction Document. Notwithstanding any provision to the contrary contained in any Transaction Document, it is
expressly agreed and provided that the total liability of the Company under the Transaction Documents for payments in the nature of interest
shall not exceed the maximum lawful rate authorized under applicable law (the “Maximum Rate”), and, without limiting
the foregoing, in no event shall any rate of interest or default interest, or both of them, when aggregated with any other sums in the
nature of interest that the Company may be obligated to pay under the Transaction Documents exceed such Maximum Rate. It is agreed that
if the maximum contract rate of interest allowed by law and applicable to the Transaction Documents is increased or decreased by statute
or any official governmental action subsequent to the date hereof, the new maximum contract rate of interest allowed by law will be the
Maximum Rate applicable to the Transaction Documents from the effective date thereof forward, unless such application is precluded by
applicable law. If under any circumstances whatsoever, interest in excess of the Maximum Rate is paid by the Company to any Buyer with
respect to indebtedness evidenced by the Transaction Documents, such excess shall be applied by such Buyer to the unpaid principal balance
of any such indebtedness or be refunded to the Company, the manner of handling such excess to be at such Buyer’s election.


 






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5.18         
Independent Nature of Buyers’ Obligations and Rights. The obligations of each Buyer under any Transaction Document
are several and not joint with the obligations of any other Buyer, and no Buyer shall be responsible in any way for the performance or
non-performance of the obligations of any other Buyer under any Transaction Document. Nothing contained herein or in any other Transaction
Document, and no action taken by any Buyer pursuant hereto or thereto, shall be deemed to constitute the Buyers as a partnership, an
association, a joint venture or any other kind of entity, or create a presumption that the Buyers are in any way acting in concert or
as a group with respect to such obligations or the transactions contemplated by the Transaction Documents. Except as may otherwise be
provided in the Security Documents, each Buyer shall be entitled to independently protect and enforce its rights, including, without
limitation, the rights arising out of this Agreement or out of the other Transaction Documents, and it shall not be necessary for any
other Buyer to be joined as an additional party in any Proceeding for such purpose. Each Buyer has been represented by its own separate
legal counsel in its review and negotiation of the Transaction Documents. For reasons of administrative convenience only, each Buyer
and its respective counsel have chosen to communicate with the Company through KDW. KDW does not represent any of the Buyers and only
represents the lead investor. The Company has elected to provide all Buyers with the same terms and Transaction Documents for the convenience
of the Company and not because it was required or requested to do so by any of the Buyers. It is expressly understood and agreed that
each provision contained in this Agreement and in each other Transaction Document is between the Company and a Buyer, solely, and not
between the Company and the Buyers collectively and not between and among the Buyers.


 


5.19         
Liquidated Damages. The Company’s obligations to pay any partial liquidated damages or other amounts owing under
the Transaction Documents is a continuing obligation of the Company and shall not terminate until all unpaid partial liquidated damages
and other amounts have been paid notwithstanding the fact that the instrument or security pursuant to which such partial liquidated damages
or other amounts are due and payable shall have been canceled.


 


5.20         
Saturdays, Sundays, Holidays, etc.If the last or appointed day for the taking of any action or the expiration of any
right required or granted herein shall not be a Business Day, then such action may be taken or such right may be exercised on the next
succeeding Business Day.


 






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5.21         
 Construction. The parties agree that each of them and/or their respective counsel have reviewed and had an opportunity
to revise the Transaction Documents and, therefore, the normal rule of construction to the effect that any ambiguities are to be resolved
against the drafting party shall not be employed in the interpretation of the Transaction Documents or any amendments thereto. In addition,
each and every reference to share prices and shares of Common Stock in any Transaction Document shall be subject to adjustment for reverse
and forward stock splits, stock dividends, stock combinations and other similar transactions of the Common Stock that occur after the
date of this Agreement.


 


5.22         
WAIVER OF JURY TRIAL. IN ANY ACTION, SUIT, OR PROCEEDING IN ANY JURISDICTION BROUGHT BY ANY PARTY AGAINST ANY OTHER
PARTY, THE PARTIES EACH KNOWINGLY AND INTENTIONALLY, TO THE GREATEST EXTENT PERMITTED BY APPLICABLE LAW, HEREBY ABSOLUTELY, UNCONDITIONALLY,
IRREVOCABLY AND EXPRESSLY WAIVES FOREVER TRIAL BY JURY. 


 


(Signature Pages Follow)


 






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


 


	KNIGHTSCOPE, INC.	 	Address for Notice:
	 	 	 
	 	 	 
	By:	/s/ Mallorie Burak	 	Email:
	 	Name: Mallorie Burak	 	 
	 	Title: Chief Financial Officer	 	 
	 	 	 	 
	With a copy to (which shall not constitute notice):	 	 



 


Perkins Coie LLP


505 Howard Street


Suite 1000


San Francisco, California 94105


Attention: David Dedyo and Ned A. Prusse


Email: ddedyo@perkinscoie.com and nprusse@perkinscoie.com


 


[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK


SIGNATURE PAGE FOR BUYER FOLLOWS]


 






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[BUYER
SIGNATURE PAGES TO KNIGHTSCOPE SECURITIES PURCHASE AGREEMENT]


 


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


 


 


Name of Buyer:


 


Signature of Authorized Signatory of Buyer: ____________________________________________


Name of Authorized Signatory:



Title of Authorized Signatory:


 


Email Address of Authorized Signatory: _____________________________________________


 


Address for Notice to Buyer:


 


 


 


 


Address for Delivery of Securities to Buyer (if not same as address
for notice):


 


 


 


 


 


Subscription Amount: $_____________


 


Principal Amount (1.215 x Subscription Amount): $_____________


 


Warrant Shares: _________________ Beneficial Ownership Blocker  ̈
4.99% or   ̈ 9.99%


 


 


[SIGNATURE PAGES CONTINUE]


 






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