SECURITIES PURCHASE AGREEMENT


 


This SECURITIES
PURCHASE AGREEMENT (the “Agreement”), dated as of _____________, 2016, by and between HISPANICA INTERNATIONAL
DELIGHTS OF AMERICA, INC., a Delaware corporation, with headquarters located at
575 Lexington Ave., 4th Floor, New York, NY 10022 (the “Company”), and [____], a [__] company, with
its address at [___] (the “Buyer”).


 


WHEREAS:


 


A. The Company and
the Buyer are executing and delivering this Agreement in reliance upon the exemption from securities registration afforded by Section
4(a)(2) of the Securities Act of 1933, as amended (the “1933 Act”) and Rule 506(b) promulgated by the United States
Securities and Exchange Commission (the “SEC”) under the 1933 Act;


 


B. Buyer desires
to purchase from the Company, and the Company desires to issue and sell to the Buyer, upon the terms and conditions set forth in
this Agreement, a Convertible Promissory Note of the Company, in the aggregate principal amount of $ ___________________ (together
with any note(s) issued in replacement thereof or as a dividend thereon or otherwise with respect thereto in accordance with the
terms thereof, in the form attached hereto as Exhibit A, the “Note”), convertible into shares of common stock,
$0.001 par value per share, of the Company (the “Common Stock”), upon the terms and subject to the limitations and
conditions set forth in such Note;


 


C. The Buyer wishes
to purchase, upon the terms and conditions stated in this Agreement, such principal amount of the Note as is set forth immediately
below its name on the signature pages hereto;


 


D. The Buyer further
wishes to purchase, upon the terms and conditions stated in this Agreement, a warrant, in the form attached hereto as Exhibit
B (the “Warrant”), to purchase 250,000 shares of Common Stock (the “Warrant Shares”) with an exercise
price of $0.85 per share;


 


E. The Company wishes
to issue _____________ restricted shares of Common Stock to the Buyer as additional consideration for the purchase of the Note
by the Buyer (the “Issuance Shares”); and


 


F. In order to provide
for registration of the public resale under the 1933 Act of the Conversion Shares (as defined below), the Warrant Shares and the
Issuance Shares, the Company and the Buyer are concurrently with the execution of this Agreement executing a Registration Rights
Agreement, in the form attached hereto as Exhibit C (the “Registration Rights Agreement”).


 


NOW THEREFORE,
in consideration of the foregoing and of the agreements and covenants herein contained, and for other good and valuable consideration,
the receipt and sufficiency of which is hereby acknowledged, the Company and the Buyer hereby agree as follows:


 


1. Purchase and Sale of Note.


 


a.
Purchase of Note. On the Closing Date (as defined below), the Company shall issue and sell to the Buyer, and the Buyer agrees
to purchase from the Company, the Note in the principal amount as is set forth immediately below the Buyer’s name on the
signature pages hereto. 


 


b. Form of Payment.
On the Closing Date: (i) the Buyer shall pay the purchase price for the Note to be issued and sold to it at the Closing (as defined
below) (the “Purchase Price”) by wire transfer of immediately available funds to the escrow account established for
the Closing with Signature Bank, in accordance with the Signature Bank’s written wiring instructions, against delivery of
the Note in an amount equal to the Actual Amount of Purchase Price of Note as is set forth below the Buyer’s name on the
signature pages hereto, and (ii) the Company shall deliver such duly executed Note on behalf of the Company, to the Buyer, against
delivery of such Purchase Price.


 


c. Closing Date.
Subject to the satisfaction (or written waiver) of the conditions thereto set forth in Section 6 and Section 7 below, the date
and time of the issuance and sale of the Note pursuant to this Agreement (the “Closing Date”) shall be 4:00 PM, Eastern
Time on the date first written above, or such other mutually agreed upon time.


 


d. Closing.
The closing of the transactions contemplated by this Agreement (the “Closing”) shall occur on the Closing Date at such
location as may be agreed to by the parties (including via exchange of electronic signatures). Concurrently with the Closing, the
Company shall be permitted to sell promissory notes identical to the Note to third party investors up to an aggregate additional
principal amount (including original issuance discount) of $__________________.


 


1A.Warrant.
On the Closing Date, the Company shall issue and sell to the Buyer and the Buyer agrees to
purchase the Warrant from the Company.


 


1B.Issuance
Shares. Within three business days of the Closing Date, the Company shall issue the Issuance
Shares to the Buyer. As used in this Agreement, the term “business day” shall mean any day other than a Saturday,
Sunday or a day on which commercial banks in the City of New York, New York are authorized or required by law or executive order
to remain closed.


 


2.
Buyer’s Representations and Warranties. The Buyer represents and warrants to the Company as of the Closing
Date that:


 


a. Investment
Purpose. As of the Closing Date, the Buyer is purchasing the Note, the Warrant, the Warrant Shares, the Issuance Shares and
the shares of Common Stock issuable upon conversion of or otherwise pursuant to the Note and such additional shares of Common Stock,
if any, as are issuable on account of interest on the Note pursuant to this Agreement, such shares of Common Stock being collectively
referred to herein as the “Conversion Shares” and, collectively with the Note, the Warrant, the Warrant Shares and
the Issuance Shares, the “Securities”) for its own account and not with a present view towards the public sale or distribution
thereof, except pursuant to sales registered or exempted from registration under the 1933 Act; provided, however,
that by making the representations herein, the Buyer does not agree to hold any of the Securities for any minimum or other specific
term and reserves the right to dispose of the Securities at any time in accordance with or pursuant to a registration statement
or an exemption under the 1933 Act.


 


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


 


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


 


d. Information.
The Buyer understands that its investment in the Securities involves a significant degree of risk. The Buyer is not aware of any
facts that may constitute a breach of any of the Company's representations and warranties made herein. The Buyer has reviewed the
Company’s filings with the SEC including the Company’s Annual Report on Form 10-K for the fiscal year ended May 31,2016,
which was filed with the SEC on September 2, 2016. The Buyer understands that its investment in the Securities involves a significant
degree of risk.


 


e. Governmental
Review. The Buyer understands that no United States federal or state agency or any other government or governmental agency
has passed upon or made any recommendation or endorsement of the Securities.


 


f. Transfer
or Re-sale. The Buyer understands that (i) the sale or resale of the Securities has not been and is not being registered under
the 1933 Act or any applicable state securities laws, and the Securities may not be transferred unless (a) the Securities are sold
pursuant to an effective registration statement under the 1933 Act, (b) the Buyer shall have delivered to the Company, at the cost
of the Company, an opinion of counsel (which may be the Legal Counsel Opinion (as defined below that shall be in form, substance
and scope customary for opinions of counsel in comparable transactions to the effect that the Securities to be sold or transferred
may be sold or transferred pursuant to an exemption from such registration, which opinion shall be reasonably acceptable to the
Company, or (c) the Securities are sold pursuant to Rule 144, (ii) any sale of such Securities made in reliance on Rule 144 or
Rule 144A promulgated under the 1933 Act (collectively, “Rule 144”) may be made only in accordance with the terms of
said Rule and further, if said Rule is not applicable, any re-sale of such Securities under circumstances in which the seller (or
the person through whom the sale is made) may be deemed to be an underwriter (as that term is defined in the 1933 Act) may require
compliance with some other exemption under the 1933 Act or the rules and regulations of the SEC thereunder; and (iii) neither the
Company nor any other person is under any obligation to register such Securities under the 1933 Act or any state securities
laws or to comply with the terms and conditions of any exemption thereunder (in each case). Notwithstanding the foregoing or anything
else contained herein to the contrary, the Securities may be pledged in connection with a bona fide margin account or other
lending arrangement secured by the Securities, and such pledge of Securities shall not be deemed to be a transfer, sale or assignment
of the Securities hereunder, and the Buyer in effecting such pledge of Securities shall be not required to provide the Company
with any notice thereof or otherwise make any delivery to the Company pursuant to this Agreement or otherwise.


 


g. Legends.
The Buyer understands that until such time as the Issuance Shares, the Note and, upon conversion of the Note in accordance with
its terms, the Conversion Shares, the Warrants and, upon exercise of the Warrants in accordance with their respective terms, the
Warrant Shares, have been registered under the 1933 Act or may be sold pursuant to Rule 144 without any restriction as to the number
of securities as of a particular date that can then be immediately sold, the Securities may bear a restrictive legend in substantially
the following form (and a stop-transfer order may be placed against transfer of the certificates for such Securities):


 


“NEITHER THE ISSUANCE
AND SALE OF THE SECURITIES REPRESENTED BY THIS CERTIFICATE NOR THE SECURITIES INTO WHICH THESE SECURITIES ARE [CONVERTIBLE/EXERCISABLE]
HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE STATE SECURITIES LAWS. THE SECURITIES MAY NOT
BE OFFERED FOR SALE, SOLD, TRANSFERRED OR ASSIGNED (I) IN THE ABSENCE OF (A) AN EFFECTIVE REGISTRATION STATEMENT FOR THE SECURITIES
UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR (B) AN OPINION OF COUNSEL (WHICH COUNSEL SHALL BE SELECTED BY THE HOLDER), IN
A GENERALLY ACCEPTABLE FORM AND REASONABLY ACCEPTABLE TO THE COMPANY, THAT REGISTRATION IS NOT REQUIRED UNDER SAID ACT OR (II)
UNLESS SOLD PURSUANT TO RULE 144 UNDER SAID ACT. NOTWITHSTANDING THE FOREGOING, THE SECURITIES MAY BE PLEDGED IN CONNECTION WITH
A BONA FIDE MARGIN ACCOUNT OR OTHER LOAN OR FINANCING ARRANGEMENT SECURED BY THE SECURITIES.”


 


The
legend set forth above shall be removed and the Company shall issue a certificate for the applicable shares of Common Stock without
such legend to the holder of any Security upon which it is stamped or (as requested by such holder) issue the
applicable shares of Common Stock to such holder by electronic delivery by crediting the account of such holder’s
broker with The Depository Trust Company (“DTC”), if, unless otherwise
required by applicable state securities laws, (a) following a sale thereof under an effective registration statement filed under
the 1933 Act covering the resale of such Security, (b) following any sale of such Security pursuant to Rule 144 (assuming
the transferor is not an affiliate of the Company), (c) if such Security is eligible to be transferred under Rule 144 without volume
or manner of sale restrictions (provided that the Buyer provides the Company with reasonable assurances that such Securities are
eligible for transfer under Rule 144, which at the option of the Company may include an opinion of Buyer’s counsel or an
opinion from the Company’s counsel (“Legal Opinion”’) ), or (d) in connection with a transfer (other than
under Rule 144) the Buyer provides the Company with an opinion of counsel, in form, substance and scope customary for opinions
of counsel in comparable transactions and reasonably acceptable to the Company, to the effect that a public sale or transfer of
such Security may be made without registration under the 1933 Act. The Buyer agrees to sell all Securities, including those represented
by a certificate(s) from which the legend has been removed, in compliance with applicable prospectus delivery requirements, if
any.


 


Notwithstanding
the foregoing, certificates evidencing the Conversion Shares, Issuance Shares and Warrant Shares shall not contain any legend (including
the legend set forth in this Section 2(g)), (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 Conversion Shares, Issuance
Shares or Warrant Shares pursuant to Rule 144, (iii) if such Conversion Shares, Issuance Shares or Warrant Shares are eligible
for sale under Rule 144, or (iv) if such legend is not required under applicable requirements of the Securities Act (including
judicial interpretations and pronouncements issued by the staff of the Commission). The Company shall cause its counsel to issue
a legal opinion to the Transfer Agent if required by the Transfer Agent to effect the removal of the legend hereunder. If all or
any portion of a Warrant is exercised at a time when there is an effective registration statement to cover the resale of the Warrant
Shares, or if such Warrant Shares may be sold under Rule 144 and the Company is then in compliance with the current public information
required under Rule 144, or if the Conversion Shares, Issuance Shares or Warrant 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 as to such Conversion
Shares, Issuance Shares or Warrant Shares 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 Conversion Shares,
Issuance Shares or Warrant Shares shall be issued free of all legends. The Company agrees that following the effective date of
a registration statement or at such time as such legend is no longer required under this Section 2(g) it will, no later than three
Trading Days following the delivery by a Buyer to the Company or the Transfer Agent of a certificate representing Conversion Shares,
Issuance Shares or Warrant Shares, as the case may be, issued with a restrictive legend (such third Trading Day, 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 2. Certificates for Securities 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.


 


In addition to such
Buyer’s other available remedies, the Company shall pay to a Buyer in cash, (i) as partial liquidated damages “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 this Section 2(g),
$10 per Trading Day (increasing to $20 per Trading Day five (5) Trading Days after such damages have begun to accrue) for each
Trading Day after the Legend Removal Date until such certificate 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 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 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 lowest closing sale price of
the Common Stock on any Trading Day during the period commencing on the date of the delivery by such Buyer to the Company of the
applicable Underlying Shares (as the case may be) and ending on the date of such delivery and payment under this clause. 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 representing
Securities as set forth in this Section 2 is predicated upon the Company’s reliance upon this understanding.


 


 


h. Authorization;
Enforcement. This Agreement has been duly and validly authorized by the Buyer and has been duly executed and delivered on behalf
of the Buyer, and this Agreement constitutes a valid and binding agreement of the Buyer enforceable in accordance with its terms,
except as enforcement may be limited by bankruptcy, insolvency, reorganization, moratorium
or other similar laws affecting creditors’ rights generally and except as may be limited by the exercise of judicial discretion
in applying principles of equity.


 


i. Residency.
The Buyer is a resident of the jurisdiction set forth immediately below the Buyer’s name on the signature pages hereto.


 


j. Certain Trading
Activities. Other than consummating the transactions contemplated hereunder, such Buyer has not directly or indirectly, nor
has any Person acting on behalf of or pursuant to any understanding with such Purchaser, executed any purchases or sales, including
Short Sales, of the securities of the Company during the period commencing as of the time that such Purchaser 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 Purchaser 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 avoidance of doubt, nothing contained herein shall constitute a representation
or warranty, or preclude any actions, with respect to the identification of the availability of, or securing of, available shares
to borrow in order to effect Short Sales or similar transactions in the future. “Short Sales” means all “short
sales” as defined in Rule 200 promulgated under Regulation SHO under the Securities Exchange Act of 1934, as amended (the
“1934 Act”).


 


k. Experience
of the Buyer. The 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. The 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.


 


l. Organization;
Authority


. The Buyer is an
entity duly organized, validly existing and in good standing under the laws of the jurisdiction of its organization with the requisite
power and authority to enter into and to consummate the transactions contemplated by this Agreement and all documents contemplated
by this Agreement to which it is a party and otherwise to carry out its obligations hereunder and thereunder.


 


3.
Representations and Warranties of the Company. The Company represents and warrants to the Buyer as of the Closing
Date that, except as otherwise disclosed in the Company’s public filings and reports with the Securities and Exchange Commission
or as attached as a schedule hereto:


 


a.
Organization and Qualification. The Company and each of its Subsidiaries (as defined below), if any, is a corporation duly
organized, validly existing and in good standing under the laws of the jurisdiction in which it is incorporated, with full power
and authority (corporate and other) to own, lease, use and operate its properties and to carry on its business as and where now
owned, leased, used, operated and conducted. Schedule 3(a), if attached hereto, sets forth a list of all of the Subsidiaries of
the Company and the jurisdiction in which each is incorporated. The Company and each of its Subsidiaries is duly qualified as a
foreign corporation to do business and is in good standing in every jurisdiction in which its ownership or use of property or the
nature of the business conducted by it makes such qualification necessary except where the failure to be so qualified or in good
standing would not have a Material Adverse Effect. “Material Adverse Effect” means any material adverse effect on the
business, operations, assets, financial condition or prospects of the Company or its Subsidiaries, if any, taken as a whole, or
on the transactions contemplated hereby or by the agreements or instruments to be entered into in connection herewith. “Subsidiaries”
means any corporation or other organization, whether incorporated or unincorporated, in which the Company owns, directly or indirectly,
a majority equity or other ownership interest.


 


b.
Authorization; Enforcement. (i) The Company has all requisite corporate power and authority to enter into and perform
this Agreement, the Note, the Warrant and the Registration Rights Agreement, and to consummate the transactions contemplated hereby
and thereby and to issue the Securities, in accordance with the terms hereof and thereof, (ii) the execution and delivery of this
Agreement, the Issuance Shares, the Note, the Warrant, and the Registration Rights Agreement and (if applicable) the Conversion
Shares and the Warrant Shares by the Company and the consummation by it of the transactions contemplated hereby and thereby (including
without limitation, the issuance of the Note, the Warrant, the Issuance Shares, and the issuance and reservation for issuance of
the Conversion Shares and the Warrant Shares issuable upon conversion or exercise of the Note and the Warrant) have been duly authorized
by the Company’s Board of Directors and no further consent or authorization of the Company, its Board of Directors, or its
shareholders is required, (iii) this Agreement, the Note, the Warrant and the Registration Rights Agreement (together with any
other instruments executed in connection herewith or therewith) have been duly executed and delivered by the Company by its authorized
representative, and such authorized representative is the true and official representative
with authority to sign this Agreement, the Note, the Warrant, the Registration Rights Agreement
and the other instruments documents executed in connection herewith or therewith and bind the Company accordingly, and (iv) this
Agreement constitutes, and upon execution and delivery by the Company of the Note, the Warrant and the Registration Rights
Agreement, each of such instruments will constitute, a legal, valid and binding obligation
of the Company enforceable against the Company in accordance with its terms.


 


c.
Capitalization; Governing Documents. As of May 31, 2016, the authorized capital stock of the Company consists of: 100,000,000
authorized shares of Common Stock, of which 13,040,471 shares
were issued and outstanding, and 10,000,000 authorized shares of preferred stock, of
which 1,200,000 were issued and outstanding. All of such outstanding shares of capital stock are, or upon issuance will be, duly
authorized, validly issued, fully paid and non-assessable. No shares of capital stock of the Company are subject to preemptive
rights or any other similar rights of the shareholders of the Company or any liens or encumbrances imposed through the actions
or failure to act of the Company. As of the effective date of this Agreement, other than as publicly announced prior to such date
and reflected in the SEC filings of the Company (i) there are no outstanding options, warrants, scrip, rights to subscribe for,
puts, calls, rights of first refusal, agreements, understandings, claims or other commitments or rights of any character whatsoever
relating to, or securities or rights convertible into or exchangeable for any shares of capital stock of the Company or any of
its Subsidiaries, or arrangements by which the Company or any of its Subsidiaries is or may become bound to issue additional shares
of capital stock of the Company or any of its Subsidiaries, (ii) there are no agreements or arrangements under which the Company
or any of its Subsidiaries is obligated to register the sale of any of its or their securities under the 1933 Act and (iii) there
are no anti-dilution or price adjustment provisions contained in any security issued by the Company (or in any agreement providing
rights to security holders) that will be triggered by the issuance of any of the Securities, except as provided for in Schedule
3 (b) The Company has furnished to the Buyer true and correct copies of the Company’s Certificate of Incorporation as in
effect on the date hereof (“Certificate of Incorporation”), the Company’s By-laws, as in effect on the date hereof
(the “By-laws”), and the terms of all securities convertible into or exercisable for Common Stock of the Company and
the material rights of the holders thereof in respect thereto.


 


d.
Issuance of Conversion Shares and Warrant Shares. The Conversion Shares are duly authorized and reserved for issuance
and, upon conversion of the Note in accordance with their respective terms, will be validly issued, fully paid and non-assessable,
and free from all taxes, liens, claims and encumbrances with respect to the issue thereof and shall not be subject to preemptive
rights or other similar rights of shareholders of the Company and will not impose personal liability upon the holder thereof. The
Warrant Shares are duly authorized and reserved for issuance and, upon exercise of the Warrant in accordance with its terms, will
be validly issued, fully paid and non-assessable, and free from all taxes, liens, claims and encumbrances with respect to the issue
thereof and shall not be subject to preemptive rights or other similar rights of shareholders of the Company and will not impose
personal liability upon the holder thereof.


 


e.
Issuance of Issuance Shares. The Issuance Shares are duly authorized and will be validly issued, fully paid and non-assessable,
and free from all taxes, liens, claims and encumbrances with respect to the issue thereof and shall not be subject to preemptive
rights or other similar rights of shareholders of the Company and will not impose personal liability upon the holder thereof.


 


f. Acknowledgment
of Dilution. The Company understands and acknowledges the potentially dilutive effect to the Common Stock upon the issuance
of the Issuance Shares and, upon conversion of the Note, the Conversion Shares, and, upon exercise of the Warrant, the Warrant
Shares. The Company further acknowledges that its obligation to issue Issuance Shares and, upon conversion of the Note or exercise
of the Warrant, the Conversion Shares and the Warrant Shares, respectively, in accordance with this Agreement, the Note and the
Warrant is absolute and unconditional regardless of the dilutive effect that such issuance may have on the ownership interests
of other shareholders of the Company.


 


g. No
Conflicts. The execution, delivery and performance of this Agreement, the Note, the Warrant and the Registration Rights
Agreement by the Company and the consummation by the Company of the transactions contemplated
hereby and thereby (including, without limitation, the issuance of the Issuance Shares and the issuance and reservation for issuance
of the Conversion Shares and the Warrant Shares) will not (i) conflict with or result in a violation of any provision of the Certificate
of Incorporation or By-laws, or (ii) violate or conflict with, or result in a breach of any provision of, or constitute a default
(or an event which with notice or lapse of time or both could become a default) under, or give to others any rights of termination,
amendment, acceleration or cancellation of, any agreement, note, evidence of indebtedness, indenture, patent, patent license or
instrument to which the Company or any of its Subsidiaries is a party (except for possible violations or conflicts as would not,
individually or in the aggregate, have a Material Adverse Effect) or (iii) result in a violation of any law, rule, regulation,
order, judgment or decree (including federal and state securities laws and regulations and regulations of any self-regulatory organizations
to which the Company or its securities are subject) applicable to the Company or any of its Subsidiaries or by which any property
or asset of the Company or any of its Subsidiaries is bound or affected (except for such conflicts, defaults, terminations, amendments,
accelerations, cancellations and violations as would not, individually or in the aggregate, have a Material Adverse Effect). Neither
the Company nor any of its Subsidiaries is in violation of its Certificate of Incorporation, By-laws or other organizational documents
and neither the Company nor any of its Subsidiaries is in default (and no event has occurred which with notice or lapse of time
or both could put the Company or any of its Subsidiaries in default) under, and neither the Company nor any of its Subsidiaries
has taken any action or failed to take any action that would give to others any rights of termination, amendment, acceleration
or cancellation of, any agreement, indenture or instrument to which the Company or any of its Subsidiaries is a party or by which
any property or assets of the Company or any of its Subsidiaries is bound or affected, except for possible defaults as would not,
individually or in the aggregate, have a Material Adverse Effect. The businesses of the Company and its Subsidiaries, if any, are
not being conducted, and shall not be conducted so long as the Buyer owns any of the Securities, in violation of any law, ordinance
or regulation of any governmental entity. Except as specifically contemplated by this Agreement and as required under the 1933
Act and any applicable state securities laws, the Company is not required to obtain any consent, authorization or order of, or
make any filing or registration with, any court, governmental agency, regulatory agency, self-regulatory organization or stock
market or any third party in order for it to execute, deliver or perform any of its obligations under this Agreement, the Note,
the Warrant or the Registration Rights Agreement in accordance with the terms hereof
or thereof or to issue and sell the Note and the Warrant in accordance with the terms hereof and to issue Issuance Shares
and, upon conversion of the Note, Conversion Shares and, upon exercise of the Warrant, the Warrant Shares.
All consents, authorizations, orders, filings and registrations which the Company is required to obtain pursuant to the preceding
sentence have been obtained or effected on or prior to the date hereof. If the Company is listed on the Over-the-Counter
Bulletin Board, the OTCQB Market operated by OTC Markets Group, Inc. or any successor to such markets (collectively, the “OTCBB”),
the Company is not in violation of the listing requirements of the OTCBB and does not reasonably anticipate that the Common Stock
will be delisted by the OTCBB in the foreseeable future. The Company and its Subsidiaries are unaware of any facts or circumstances,
which might give rise to any of the foregoing.


 


h.
SEC Documents; Financial Statements. The Company has filed all reports, schedules, forms, statements and other documents
required to be filed by it with the SEC pursuant to the reporting requirements of the 1934 Act (all of the foregoing filed prior
to the date hereof and all exhibits included therein and financial statements and schedules thereto and documents (other than exhibits
to such documents) incorporated by reference therein, being hereinafter referred to herein as the “SEC Documents”).
As of their respective dates, the SEC Documents complied in all material respects with the requirements of the 1934 Act and the
rules and regulations of the SEC promulgated thereunder applicable to the SEC Documents, and none of the SEC Documents, at the
time they were filed with the SEC, contained any untrue statement of a material fact or omitted to state a material fact required
to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they were
made, not misleading. None of the statements made in any such SEC Documents is, or has been, required to be amended or updated
under applicable law (except for such statements as have been amended or updated in subsequent filings prior the date hereof).
As of their respective dates, the financial statements of the Company included in the SEC Documents complied as to form in all
material respects with applicable accounting requirements and the published rules and regulations of the SEC with respect thereto.
Such financial statements have been prepared in accordance with United States generally accepted accounting principles, consistently
applied, during the periods involved and fairly present in all material respects the consolidated financial position of the Company
and its consolidated Subsidiaries as of the dates thereof and the consolidated results of their operations and cash flows for the
periods then ended (subject, in the case of unaudited statements, to normal year-end audit adjustments). Except as set forth in
the financial statements of the Company included in the SEC Documents, the Company has no liabilities, contingent or otherwise,
other than (i) liabilities incurred in the ordinary course of business subsequent to December 31, 2014, and (ii) obligations under
contracts and commitments incurred in the ordinary course of business and not required under generally accepted accounting principles
to be reflected in such financial statements, which, individually or in the aggregate, are not material to the financial condition
or operating results of the Company. The Company is subject to the reporting requirements of the 1934 Act. 


 


i.
Absence of Certain Changes. Except as set forth in the SEC Documents, since March
31, 2015, there has been no material adverse change and no material adverse development in the assets, liabilities, business,
properties, operations, financial condition, results of operations, prospects or 1934 Act reporting status of the Company or any
of its Subsidiaries.


 


j. Absence
of Litigation. There is no action, suit, claim, proceeding, inquiry or investigation before or by any court, public board,
government agency, self-regulatory organization or body pending or, to the knowledge of the Company or any of its Subsidiaries,
threatened against or affecting the Company or any of its Subsidiaries, or their officers or directors in their capacity as such,
that could have a Material Adverse Effect. The SEC Documents contain a complete list and summary description of any pending or,
to the knowledge of the Company, threatened proceeding against or affecting the Company or any of its Subsidiaries, without regard
to whether it would have a Material Adverse Effect. The Company and its Subsidiaries are unaware of any facts or circumstances,
which might give rise to any of the foregoing.


 


k. Intellectual
Property. The Company and each of its Subsidiaries owns or possesses the requisite licenses or rights to use all patents, patent
applications, patent rights, inventions, know-how, trade secrets, trademarks, trademark applications, service marks, service names,
trade names and copyrights (“Intellectual Property”) necessary to enable it to conduct its business as now operated
(and, as presently contemplated to be operated in the future); there is no claim or action by any person pertaining to, or proceeding
pending, or to the Company’s knowledge threatened, which challenges the right of the Company or of a Subsidiary with respect
to any Intellectual Property necessary to enable it to conduct its business as now operated (and, as presently contemplated to
be operated in the future); to the best of the Company’s knowledge, the Company’s or its Subsidiaries’ current
and intended products, services and processes do not infringe on any Intellectual Property or other rights held by any person;
and the Company is unaware of any facts or circumstances which might give rise to any of the foregoing. The Company and each of
its Subsidiaries have taken reasonable security measures to protect the secrecy, confidentiality and value of their Intellectual
Property.


 


l. No
Materially Adverse Contracts, Etc. Neither the Company nor any of its Subsidiaries is subject to any charter, corporate or
other legal restriction, or any judgment, decree, order, rule or regulation which in the judgment of the Company’s officers
has or is expected in the future to have a Material Adverse Effect. Neither the Company nor any of its Subsidiaries is a party
to any contract or agreement, which in the judgment of the Company’s officers has or is expected to have a Material Adverse
Effect.


 


m. Tax
Status. The Company and each of its Subsidiaries has made or filed all federal, state and foreign income and all other tax
returns, reports and declarations required by any jurisdiction to which it is subject (unless and only to the extent that the Company
and each of its Subsidiaries has set aside on its books provisions reasonably adequate for the payment of all material unpaid and
unreported taxes) and 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, except those being contested in good faith and has set aside on its
books provisions reasonably adequate for the payment of all material taxes for periods subsequent to the periods to which such
returns, reports or declarations apply. There are no unpaid taxes in any material amount claimed to be due by the taxing authority
of any jurisdiction, and the officers of the Company know of no basis for any such claim. The Company has not executed a waiver
with respect to the statute of limitations relating to the assessment or collection of any foreign, federal, state or local tax.
None of the Company’s tax returns is presently being audited by any taxing authority.


 


n.
Transactions with Affiliates. Except for arm’s length transactions pursuant to which the Company or any of its Subsidiaries
makes payments in the ordinary course of business upon terms no less favorable than the Company or any of its Subsidiaries could
obtain from third parties and other than the grant of stock options described in the SEC Documents, none of the officers, directors,
or employees of the Company is presently a party to any transaction with the Company or any of its Subsidiaries (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, or otherwise requiring payments to or from
any officer, director or such employee or, to the knowledge of the Company, any corporation, partnership, trust or other entity
in which any officer, director, or any such employee has a substantial interest or is an officer, director, trustee or partner.


 


o.
Disclosure. All information relating to or concerning the Company or any of its Subsidiaries set forth in this Agreement
is true and correct in all material respects and the Company has not omitted to state any material fact necessary in order to make
the statements made herein, in light of the circumstances under which they were made, not misleading. No event or circumstance
has occurred or exists with respect to the Company or any of its Subsidiaries or its or their business, properties, prospects,
operations or financial conditions, which, under applicable law, rule or regulation, requires public disclosure or announcement
by the Company but which has not been so publicly announced or disclosed (assuming for this purpose that the Company’s reports
filed under the 1934 Act are being incorporated into an effective registration statement filed by the Company under the 1933 Act).


 


p.
Acknowledgment Regarding Buyer’s Purchase of Securities. The Company acknowledges and agrees that the Buyer
is acting solely in the capacity of arm’s length purchaser with respect to this Agreement and the transactions contemplated
hereby. The Company further acknowledges that the Buyer is not acting as a financial advisor or fiduciary of the Company (or in
any similar capacity) with respect to this Agreement and the transactions contemplated hereby and any statement made by the Buyer
or any of its respective representatives or agents in connection with this Agreement and the transactions contemplated hereby is
not advice or a recommendation and is merely incidental to the Buyer’s purchase of the Securities. The Company further represents
to the Buyer that the Company’s decision to enter into this Agreement has been based solely on the independent evaluation
of the Company and its representatives.


 


q. No
Integrated Offering. Neither the Company, nor any of its affiliates, nor, to the knowledge of the Company, any person acting
on its or their behalf, has directly or indirectly made any offers or sales in any security or solicited any offers to buy any
security under circumstances that would require registration under the 1933 Act of the issuance of the Securities to the Buyer.
The issuance of the Securities to the Buyer will not be integrated with any other issuance of the Company’s securities (past,
current or future) for purposes of any shareholder approval provisions applicable to the Company or its securities.


 


r.
No Brokers. Except with respect to Garden State Securities, Inc. (“GSS”) in which the Company will pay GSS a
10% cash fee and 10% warrants based on the amount of securities issued,  
the Company has taken no action, which would give rise to any claim by any person for brokerage commissions, transaction fees or
similar payments relating to this Agreement or the transactions contemplated hereby. The Company shall be responsible for all brokerage
or similar commissions arising out of the transactions contemplated hereby. The Company has agrred to pay lead investor’s
legal counsel the sum of $10,000 from the proceeds of the Note at closing.


 


s. Permits;
Compliance. The Company and each of its Subsidiaries is in possession of all franchises, grants, authorizations, licenses,
permits, easements, variances, exemptions, consents, certificates, approvals and orders necessary to own, lease and operate its
properties and to carry on its business as it is now being conducted (collectively, the “Company Permits”), and there
is no action pending or, to the knowledge of the Company, threatened regarding suspension or cancellation of any of the Company
Permits. Neither the Company nor any of its Subsidiaries is in conflict with, or in default or violation of, any of the Company
Permits, except for any such conflicts, defaults or violations which, individually or in the aggregate, would not reasonably be
expected to have a Material Adverse Effect. Since January 1, 2014, neither the Company
nor any of its Subsidiaries has received any notification with respect to possible conflicts, defaults or violations of applicable
laws, except for notices relating to possible conflicts, defaults or violations, which conflicts, defaults or violations would
not have a Material Adverse Effect.


 


t. Environmental
Matters.


 


(i)
There are, to the Company’s knowledge, with respect to the Company or any of its Subsidiaries or any predecessor of
the Company, no past or present violations of Environmental Laws (as defined below), releases of any material into the environment,
actions, activities, circumstances, conditions, events, incidents, or contractual obligations which may give rise to any common
law environmental liability or any liability under the Comprehensive Environmental Response, Compensation and Liability Act of
1980 or similar federal, state, local or foreign laws and neither the Company nor any of its Subsidiaries has received any notice
with respect to any of the foregoing, nor is any action pending or, to the Company’s knowledge, threatened in connection
with any of the foregoing. The term ”Environmental Laws” means all federal, state,
local or foreign laws relating to pollution or protection of human health or the environment (including, without limitation, ambient
air, surface water, groundwater, land surface or subsurface strata), including, without limitation, 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.


 


(ii) Other than those
that are or were stored, used or disposed of in compliance with applicable law, no Hazardous Materials are contained on or about
any real property currently owned, leased or used by the Company or any of its Subsidiaries, and no Hazardous Materials were released
on or about any real property previously owned, leased or used by the Company or any of its Subsidiaries during the period the
property was owned, leased or used by the Company or any of its Subsidiaries, except in the normal course of the Company’s
or any of its Subsidiaries’ business.


 


(iii) There are no
underground storage tanks on or under any real property owned, leased or used by the Company or any of its Subsidiaries that are
not in compliance with applicable law.


 


u.
Title to Property. The Company and its Subsidiaries have good and marketable title in fee simple to all real property and
good and marketable title to all personal property owned by them which is material to the business of the Company and its Subsidiaries,
in each case free and clear of all liens, encumbrances and defects except such as are described in Schedule 3(u), if attached hereto,
or such as would not have a Material Adverse Effect. Any real property and facilities held under lease by the Company and its Subsidiaries
are held by them under valid, subsisting and enforceable leases with such exceptions as would not have a Material Adverse Effect.


 


v.
Insurance. The Company and each of its Subsidiaries are insured by insurers of recognized financial responsibility against
such losses and risks and in such amounts as management of the Company believes to be prudent and customary in the businesses in
which the Company and its Subsidiaries are engaged. Neither the Company nor any such 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 at a cost that would not have a Material Adverse Effect. Upon written
request the Company will provide to the Buyer true and correct copies of all policies relating to directors’ and officers’
liability coverage, errors and omissions coverage, and commercial general liability coverage.


 


w. Internal Accounting
Controls. The Company and each of its Subsidiaries maintain a system of internal accounting controls sufficient, in the judgment
of the Company’s Board of Directors, 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 generally accepted accounting principles 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.


 


x. Foreign Corrupt
Practices. Neither the Company, nor any of its Subsidiaries, nor, to the knowledge of the Company, any director, officer, agent,
employee or other person acting on behalf of the Company or any Subsidiary has, in the course of his actions for, or on behalf
of, the Company, used any corporate funds for any unlawful contribution, gift, entertainment or other unlawful expenses relating
to political activity; made any direct or indirect unlawful payment to any foreign or domestic government official or employee
from corporate funds; violated or is in violation of any provision of the U.S. Foreign Corrupt Practices Act of 1977, as amended,
or made any bribe, rebate, payoff, influence payment, kickback or other unlawful payment to any foreign or domestic government
official or employee.


 


y. Solvency.
The Company (after giving effect to the transactions contemplated by this Agreement) is solvent (i.e., its assets have a
fair market value in excess of the amount required to pay its probable liabilities on its existing debts as they become absolute
and matured) and currently the Company has no information that would lead it to reasonably conclude that the Company would not,
after giving effect to the transaction contemplated by this Agreement, have the ability to, nor does it intend to take any action
that would impair its ability to, pay its debts from time to time incurred in connection therewith as such debts mature. The Company’s
financial statements for its most recent fiscal year end and interim financial statements have been prepared assuming the Company
will continue as a going concern, which contemplates the realization of assets and the satisfaction of liabilities in the normal
course of business.


 


z. No Investment
Company. The Company is not, and upon the issuance and sale of the Securities as contemplated by this Agreement will not be
an “investment company” required to be registered under the Investment Company Act of 1940 (an “Investment Company”).
The Company is not controlled by an Investment Company.


 


aa. No Off Balance
Sheet Arrangements. There is no transaction, arrangement, or other relationship between the Company or any of its Subsidiaries
and an unconsolidated or other off balance sheet entity that is required to be disclosed by the Company in its 1934 Act filings
and is not so disclosed or that otherwise could be reasonably likely to have a Material Adverse Effect.


 


bb. No Disqualification
Events. 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 1933 Act) connected with the Company in any capacity at the time of sale (each, an “Issuer Covered Person”) is
subject to any of the “Bad Actor” disqualifications described in Rule 506(d)(1)(i) to (viii) under the 1933 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.


 


cc. Manipulation
of Price. 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, or that could reasonably be expected to cause or 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.


 


dd. Acknowledgment
Regarding Buyers’ Purchase of Securities. The Company acknowledges and agrees that each of the Buyers are 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.


 


ee. Information.
The Company has not disclosed to the Buyer any material nonpublic information regarding the Company and will not disclose such
information unless such information is disclosed to the public prior to or promptly following such disclosure to the Buyer.


 


4.
ADDITIONAL COVENANTS, AGREEMENTS AND ACKNOWLEDGEMENTS. 


 


a. Best Efforts.
The parties shall use their best efforts to satisfy timely each of the conditions described in Section 6 and 7 of this Agreement.


 


b. Form D; Blue
Sky Laws. If required by applicable law, the Company agrees to file a Form D with respect to the Securities as required under
Regulation D and to provide a copy thereof to the Buyer promptly after such filing. The Company shall after the Closing Date, take
such action as the Company shall reasonably determine is necessary to qualify the Securities for sale to the Buyer at the applicable
closing pursuant to this Agreement under applicable securities or “blue sky” laws of the states of the United States
(or to obtain an exemption from such qualification), and shall provide evidence of any such action so taken to the Buyer.


 


c. Use of Proceeds.
The Company shall use the proceeds for any and all general working capital purposes.


 


d. Right of Participation
in Subsequent Offerings.


 


i.From
the date first written above until the later of (A) the 12-month anniversary of the date hereof and (B) the date the Note (including
all principal, interest, fees and expenses related thereto) is  fully repaid or converted, the
Company will not, (i) directly or indirectly, offer, sell, grant any option to purchase, or otherwise dispose of (or announce any
offer, sale, grant or any option to purchase or other disposition of) any of its or its Subsidiaries' debt, equity or equity equivalent
securities, including without limitation any debt, preferred shares, options, warrants or other instrument or security that is,
at any time during its life and under any circumstances, convertible into or exchangeable or exercisable for Common Stock (any
such offer, sale, grant, disposition or announcement being referred to as a “Subsequent Offering”) or (ii) enter
into any definitive agreement with regard to the foregoing, in each case unless the Company shall have first complied with this
Section 4(d), except for any grants of stock, options to purchase stock, restricted stock units to its directors, officers, employees,
consultants or its corporate collaborators or pursuant to any merger or acquisition event. 


 


ii.At least
three (3) 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, shall
include a term sheet or similar document relating thereto as an attachment and offer to issue and sell to or exchange with the
Buyer at least fifty percent (50%) of the Offered Securities (the “Subscription Amount”).


 


iii.To
accept an Offer, in whole or in part, the Buyer must deliver a written notice to the Company prior to the end of the 2nd
Trading Day after the Buyer’s receipt of the Subsequent Financing Notice (the “Offer Period”), setting
forth the portion of the Subscription Amount that the Buyer elects to purchase (the “Notice of Acceptance”).
The Company shall have one (1) Trading Day from the expiration of the Offer Period to complete the Subsequent Offering and in connection
therewith to issue and sell the Subscription Amount to the Buyer but only upon terms and conditions (including, without limitation,
unit prices and interest rates) that are not more favorable to the Buyer or less favorable to the Company than those set forth
in the Offer Notice. Following such first Trading Day following the Offer Period, the Company shall either (A) publicly announce
the consummation of the Subsequent Offering or (B) notify the Buyer  the termination of the Subsequent
Offering and after such time the Buyer shall not be in possession of material non-public information.


 


iv.Notwithstanding
anything to the contrary contained herein, if the Company desires to modify or amend the terms and conditions of the Offer prior
to the expiration of the Offer Period, the Company shall be required to comply with the above procedures again if the terms were
a new Subsequent Offering; provided that at least five (5) Trading Days shall have lapsed between the Offer Periods.


 


v.If by the
3rd Business Day following delivery of the Offer Notice no public disclosure regarding a transaction with respect to
the Offered Securities has been made, and no notice regarding the abandonment of such transaction has been received by the Buyer,
such transaction shall be deemed to have been abandoned and the Buyer shall not be deemed to be in possession of any material,
non-public information with respect to the Company.


vi.The Company
and the Buyer agree that if the Buyer elected to participate in the Subsequent Financing, the transaction documents related to
the Subsequent Financing shall not include any term or provision whereby suhc Buyer shall be required to agree to any restrictions
on trading as to any of the Securities purchased hereunder 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.


 


f. Listing.
The Company will, so long as the Buyer owns any of the Securities, maintain the listing and trading of its Common Stock on the
OTCBB or any equivalent replacement exchange or electronic quotation system (including but not limited to the Pink Sheets electronic
quotation system) and will comply in all respects with the Company’s reporting, filing and other obligations under the bylaws
or rules of the Financial Industry Regulatory Authority (“FINRA”) and such exchanges, as applicable. The Company shall
promptly provide to the Buyer copies of any notices it receives from the OTCBB and any other exchanges or electronic quotation
systems on which the Common Stock is then traded regarding the continued eligibility of the Common Stock for listing on such exchanges
and quotation systems.


 


g. Corporate
Existence. The Company will, so long as the Buyer beneficially owns any of the Securities, maintain its corporate existence
and shall not sell all or substantially all of the Company’s assets, except in the event of a merger or consolidation or
sale of all or substantially all of the Company’s assets, where the surviving or successor entity in such transaction (i)
assumes the Company’s obligations hereunder and under the agreements and instruments entered into in connection herewith
and (ii) is a publicly traded corporation whose Common Stock is listed for trading or quotation on the OTCBB, any tier of the NASDAQ
Stock Market, the New York Stock Exchange, the NYSE MKT or any foreign exchange.


 


h. No
Integration. The Company shall not make any offers or sales of any security (other than the Securities) under circumstances
that would require registration of the Securities being offered or sold hereunder under the 1933 Act or cause the offering of the
Securities to be integrated with any other offering of securities by the Company for the purpose of any stockholder approval provision
applicable to the Company or its securities.


 


i. No
Dilutive Issuances. So long as the Company shall have any obligation under the Note, and in addition to any adjustment in the
Conversion Price as provided for therein, the Company shall not sell or grant any option to purchase or sell or grant any right
to reprice, or otherwise dispose of or issue (or announces any sale, grant or any option to purchase or other disposition), any
Common Stock or other securities convertible into, exercisable for or otherwise entitled the any person or entity the right to
acquire shares of Common Stock at an effective price per share that is lower than the then Fixed Conversion Price (a “Dilutive
Issuance”); provided, however, that the Company may engage in a Dilutive Issuance on the express condition that proceeds
from the Dilutive Issuance shall be used to prepay the Note in accordance with Section 1.9, with such prepayment to occur at the
closing of and directly from the proceeds of the Dilutive Issuance.


 


j. Compliance
with 1934 Act. For so long as the Buyer beneficially owns the Note, the Company shall comply with the reporting requirements
of the 1934 Act; and the Company shall continue to be subject to the reporting requirements of the 1934 Act. During the period
that the Buyer beneficially owns the Note or the Warrant, if the Company shall (i) fail for any reason to satisfy the requirements
of Rule 144 the Company shall pay in cash or in shares at the Company’s option to the Holder on each day after the Deadline
and during such Conversion Failure an amount equal to 2.0% of the value of converted amount priced at the closing sale price of
the common stock at the Deadline.


 


k. Disclosure
of Transactions and Other Material Information. By 5:30 p.m., New York time, on the third business date following the date
this Agreement has been fully executed, the Company shall file a Current Report on Form 8-K describing the terms of the transactions
contemplated by this Agreement in the form required by the 1934 Act and attaching this Agreement, the form of Note, the Warrant
and the Registration Rights Agreement (the “8-K Filing”). From and after the filing of the 8-K Filing with the SEC,
the Buyer shall not be in possession of any material, nonpublic information received from the Company, any of its Subsidiaries
or any of their respective officers, directors, employees or agents that is not disclosed in the 8-K Filing. In addition, effective
upon the filing of the 8-K Filing, 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, affiliates, employees or agents, on the one hand, and the Buyer or any of its affiliates, on the other hand, shall terminate.


 


l.
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. 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.


 


5.
Transfer Agent Instructions. The Company shall issue irrevocable instructions
to its transfer agent to issue certificates, registered in the name of the Buyer or its nominee, for the Issuance Shares and, upon
conversion of the Note, the Conversion Shares and upon exercise of the Warrant, the Warrant
Shares, in such amounts as specified from time to time by the Buyer to the Company in accordance with the terms thereof
(the “Irrevocable Transfer Agent Instructions”). ]In the event that the Company proposes to replace its transfer agent,
the Company shall provide, prior to the effective date of such replacement, a fully executed Irrevocable Transfer Agent Instructions
in a form as initially delivered pursuant to this Agreement (including but not limited to the provision to irrevocably reserved
shares of Common Stock in the Reserved Amount (as defined in the Note)) signed by the successor transfer agent to the Company and
the Company. Prior to registration of the Issuance Shares, the Warrant Shares or the Conversion Shares under the 1933 Act or the
date on which the Issuance Shares or Conversion Shares may be sold pursuant to Rule 144 without any restriction as to the number
of Securities as of a particular date that can then be immediately sold, all such certificates shall bear the restrictive legend
specified in Section 2(g) of this Agreement. The Company warrants that: (i) no instruction other than the Irrevocable Transfer
Agent Instructions referred to in this Section 5 will be given by the Company to its transfer agent and that the Securities shall
otherwise be freely transferable on the books and records of the Company as and to the extent provided in this Agreement and the
Note; (i) it will not direct its transfer agent not to transfer or delay, impair, and/or hinder its transfer agent in transferring
(or issuing)(electronically or in certificated form) any certificate for Securities to be issued to the Buyer upon conversion of
or otherwise pursuant to the Note or upon exercise of or otherwise pursuant to the Warrant as and when required by the Note, the
Warrant, this Agreement and the Registration Rights Agreement; and (ii) it will not fail to remove (or directs its transfer agent
not to remove or impairs, delays, and/or hinders its transfer agent from removing) any restrictive legend (or to withdraw any stop
transfer instructions in respect thereof) on any certificate for any Securities issued to the Buyer upon conversion of or otherwise
pursuant to the Note or upon exercise of or otherwise pursuant to the Warrant as and when required by the Note, the Warrant, this
Agreement and the Registration Rights Agreement. Nothing in this Section shall affect in any way the Buyer’s obligations
and agreement set forth in Section 2(g) hereof to comply with all applicable prospectus delivery requirements, if any, upon re-sale
of the Securities. If the Buyer provides the Company, at the cost of the Buyer, with (i) an opinion of counsel in form, substance
and scope customary for opinions in comparable transactions, to the effect that a public sale or transfer of such Securities may
be made without registration under the 1933 Act and such sale or transfer is effected or (ii) the Buyer provides reasonable assurances
that the Securities can be sold pursuant to Rule 144, the Company shall permit the transfer, and, in the case of the Securities,
promptly instruct its transfer agent to issue one or more certificates, free from restrictive legend, in such name and in such
denominations as specified by the Buyer.


 


The Company acknowledges
that a breach by it of its obligations hereunder will cause irreparable harm to the Buyer, by vitiating the intent and purpose
of the transactions contemplated hereby. Accordingly, the Company acknowledges that the remedy at law for a breach of its obligations
under this Section 5 may be inadequate and agrees, in the event of a breach or threatened breach by the Company of the provisions
of this Section, that the Buyer shall be entitled, in addition to all other available remedies, to an injunction restraining any
breach and requiring immediate transfer, without the necessity of showing economic loss and without any bond or other security
being required.


 


6. Conditions to
the Company’s Obligation to Sell. The obligation of the Company hereunder to issue and sell the Note to the Buyer at
the Closing is subject to the satisfaction, at or before the Closing Date, of each of the following conditions thereto, provided
that these conditions are for the Company’s sole benefit and may be waived by the Company at any time in its sole discretion:


 


a. The Buyer shall
have executed this Agreement and delivered the same to the Company.


 


b. The Buyer shall
have delivered the Purchase Price in accordance with Section 1(b) above.


 


c. The representations
and warranties of the Buyer shall be true and correct in all material respects as of the date when made and as of the Closing Date,
as though made at that time (except for representations and warranties that speak as of a specific date), and the Buyer shall have
performed, satisfied and complied in all material respects with the covenants, agreements and conditions required by this Agreement
to be performed, satisfied or complied with by the Buyer at or prior to the Closing Date.





d. No litigation,
statute, rule, regulation, executive order, decree, ruling or injunction shall have been enacted, entered, promulgated or endorsed
by or in any court or governmental authority of competent jurisdiction or any self-regulatory organization having authority over
the matters contemplated hereby which prohibits the consummation of any of the transactions contemplated by this Agreement.


 


7. Conditions to
The Buyer’s Obligation to Purchase. The obligation of the Buyer hereunder to purchase the Note, on the Closing Date,
is subject to the satisfaction, at or before the Closing Date, of each of the following conditions, provided that these conditions
are for the Buyer’s sole benefit and may be waived by the Buyer at any time in its sole discretion:


 


a. The Company shall
have executed this Agreement and the Registration Rights Agreement and delivered the same to the Buyer.


 


b. The Company shall
have delivered to the Buyer the duly executed Note and Warrant in such denominations as the Buyer shall request and in accordance
with Section 1(b) above.


 


c. The Irrevocable
Transfer Agent Instructions, in form and substance satisfactory to the Buyer, shall have been delivered to and acknowledged in
writing by the Company’s Transfer Agent.


	 


d. The
representations and warranties of the Company shall be true and correct in all material respects as of the date when made and as
of Closing Date, as though made at such time (except for representations and warranties that speak as of a specific date) and the
Company shall have performed, satisfied and complied in all material respects with the covenants, agreements and conditions required
by this Agreement to be performed, satisfied or complied with by the Company at or prior to the Closing Date.





e. No
litigation, statute, rule, regulation, executive order, decree, ruling or injunction shall have been enacted, entered, promulgated
or endorsed by or in any court or governmental authority of competent jurisdiction or any self-regulatory organization having authority
over the matters contemplated hereby which prohibits the consummation of any of the transactions contemplated by this Agreement.


 


f. No
event shall have occurred which could reasonably be expected to have a Material Adverse Effect on the Company including but not
limited to a change in the 1934 Act reporting status of the Company or the failure of the Company to be timely in its 1934 Act
reporting obligations.


 


g. Trading
in the Common Stock on the OTCBB shall not have been suspended by the SEC, FINRA or the OTCBB.


 


h. The
Company shall have delivered to the Buyer a certificate evidencing the formation and good standing of the Company and each of its
Subsidiaries in such entity’s jurisdiction of formation issued by the Secretary of State (or comparable office) of such jurisdiction,
as of a date within ten (10) days of the Closing Date.


i. The
Company shall have deliverd to the Buyer an opinion of counsel reasonably satisfactory to the Buyer.


 


8. Governing Law; Miscellaneous.


 


a.
Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of New
York without regard to principles of conflicts of laws. Any action brought by either party against the other concerning the transactions
contemplated by this Agreement, the Note, the Warrant, the Registration Rights Agreement or any other agreement, certificate, instrument
or document contemplated hereby shall be brought only in the state courts of New York or in the federal courts located in the State
and County of New York. The parties to this Agreement hereby irrevocably waive any objection to jurisdiction and venue of any action
instituted hereunder and shall not assert any defense based on lack of jurisdiction or venue or based upon forum non-conveniens.
EACH PARTY HEREBY IRREVOCABLY WAIVES ANY RIGHT IT MAY HAVE, AND AGREES NOT TO REQUEST, A JURY TRIAL FOR THE ADJUDICATION OF
ANY DISPUTE HEREUNDER OR IN CONNECTION WITH OR ARISING OUT OF THIS AGREEMENT OR ANY TRANSACTIONS CONTEMPLATED HEREBY. The prevailing
party shall be entitled to recover from the other party its reasonable attorney’s fees and costs. In the event that any provision
of this Agreement or any other agreement delivered in connection herewith is invalid or unenforceable under any applicable statute
or rule of law, then such provision shall be deemed inoperative to the extent that it may conflict therewith and shall be deemed
modified to conform with such statute or rule of law. Any such provision which may prove invalid or unenforceable under any law
shall not affect the validity or enforceability of any other provision of this Agreement, the Note, the Warrant, the Registration
Rights Agreement or any other agreement, certificate, instrument or document contemplated hereby or thereby. Each party hereby
irrevocably waives personal service of process and consents to process being served in any suit, action or proceeding in connection
with this Agreement, the Note, the Warrant, the Registration Rights Agreement or any other agreement, certificate, instrument or
document contemplated hereby or thereby 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.


 


b. Counterparts.
This Agreement may be executed in one or more counterparts, each of which shall be deemed an original but all of which shall constitute
one and the same agreement and shall become effective when counterparts have been signed by each party and delivered to the other
party. A facsimile or .pdf signature shall be considered due execution and shall be binding upon the signatory thereto with the
same force and effect as if the signature were an original, not a facsimile or .pdf signature. Delivery of a counterpart signature
hereto by facsimile or email/.pdf transmission shall be deemed validly delivery thereof.


 



     

     

    

c. Construction;
Headings. This Agreement shall be deemed to be jointly drafted by the Company and the Buyer and shall not be construed against
any person as the drafter hereof. The headings of this Agreement are for convenience of reference only and shall not form part
of, or affect the interpretation of, this Agreement.


 


d. Severability.
In the event that any provision of this Agreement is invalid or unenforceable under any applicable statute or rule of law, then
such provision shall be deemed inoperative to the extent that it may conflict therewith and shall be deemed modified to conform
with such statute or rule of law. Any provision hereof which may prove invalid or unenforceable under any law shall not affect
the validity or enforceability of any other provision hereof.


 


e. Entire Agreement;
Amendments. This Agreement, the Note, the Warrant, the Registration Rights Agreement and the instruments referenced herein
contain the entire understanding of the parties with respect to the matters covered herein and therein and, except as specifically
set forth herein or therein, neither the Company nor the Buyer makes any representation, warranty, covenant or undertaking with
respect to such matters. No provision of this Agreement or any agreement or instrument contemplated hereby may be waived or amended
other than by an instrument in writing signed by the Buyer.


 


f. 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 theBuyers are in any way acting in concert or as a group
with respect to such obligations or the transactions contemplated by the Transaction 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. 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 Purchasers collectively and not between and among the Buyer.


 


g. Notices.
All notices, demands, requests, consents, approvals, and other communications required or permitted hereunder shall be in writing
and, unless otherwise specified herein, shall be (i) personally served, (ii) deposited in the mail, registered or certified, return
receipt requested, postage prepaid, (iii) delivered by reputable air courier service with charges prepaid, or (iv) transmitted
by hand delivery, telegram, e-mail or facsimile, addressed as set forth below or to such other address as such party shall have
specified most recently by written notice. Any notice or other communication required or permitted to be given hereunder shall
be deemed effective (a) upon hand delivery or delivery by e-mail or facsimile, with accurate confirmation generated by the transmitting
facsimile machine, at the address or number designated below (if delivered on a business day during normal business hours where
such notice is to be received), or the first business day following such delivery (if delivered other than on a business day during
normal business hours where such notice is to be received) or (b) on the second business day following the date of mailing by express
courier service, fully prepaid, addressed to such address, or upon actual receipt of such mailing, whichever shall first occur.
The addresses for such communications shall be:


 


If to the Company, to:


 


HISPANICA
INTERNATIONAL DELIGHTS OF AMERICA,INC.


575 Lexington
Ave. 4th Floor


New York, NY 10022


Attention: Chief Executive Officer


e-mail:foleonzo@hidainc.com


 


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


 


[___]


 


If to buyer:


 


[___]


 


With a copy by e-mail only to (which copy shall
not constitute notice):


 


Email to:


[__]


 


g. Successors
and Assigns. This Agreement shall be binding upon and inure to the benefit of the parties and their successors and assigns.
Neither the Company nor the Buyer shall assign this Agreement or any rights or obligations hereunder without the prior written
consent of the other. Notwithstanding the foregoing, subject to Section 2(f), the Buyer may assign its rights hereunder to any
person that purchases Securities in a private transaction from the Buyer or to any of its “affiliates,” as that term
is defined under the 1934 Act, without the consent of the Company.


 


h. Third Party
Beneficiaries. This Agreement is intended for the benefit of the parties hereto and their respective permitted successors and
assigns, and is not for the benefit of, nor may any provision hereof be enforced by, any other person.


 


i. Survival.
The representations and warranties of the Company and the agreements and covenants set forth in this Agreement shall survive the
closing hereunder notwithstanding any due diligence investigation conducted by or on behalf of the Buyer. The Company agrees to
indemnify and hold harmless the Buyer and all their officers, directors, employees and agents for loss or damage arising as a result
of or related to any breach or alleged breach by the Company of any of its representations, warranties and covenants set forth
in this Agreement or any of its covenants and obligations under this Agreement, including advancement of expenses as they are incurred.


 


j. Publicity.
The Company, and the Buyer shall have the right to review a reasonable period of time before issuance of any press releases, SEC,
OTCBB or FINRA filings, or any other public statements with respect to the transactions contemplated hereby; provided, however,
that the Company shall be entitled, without the prior approval of the Buyer, to make any press release or SEC, OTCBB (or other
applicable trading market) or FINRA filings with respect to such transactions as is required by applicable law and regulations
(although the Buyer shall be consulted by the Company in connection with any such press release prior to its release and shall
be provided with a copy thereof and be given an opportunity to comment thereon).


 


k. Expense Reimbursement;
Further Assurances. At the Closing to occur as of the Closing Date, the Company shall pay on behalf of the Buyer or reimburse
the Buyer for its legal fees and expenses incurred in connection with this Agreement in the cumulative total amount of $10,000
to be taken out of the proceeds of this Offering. Each party shall do and perform, or cause to be done and performed, all such
further acts and things, and shall execute and deliver all such other agreements, certificates, instruments and documents, as the
other party may reasonably request in order to carry out the intent and accomplish the purposes of this Agreement and the consummation
of the transactions contemplated hereby.


 


l. No Strict
Construction. The language used in this Agreement will be deemed to be the language chosen by the parties to express their
mutual intent, and no rules of strict construction will be applied against any party.


 


m. Indemnification.
In consideration of the Buyer’s execution and delivery of this Agreement and acquiring the Securities hereunder, and in addition
to all of the Company’s other obligations under this Agreement, the Note, the Warrant or the Registration Rights Agreement,
the Company shall defend, protect, indemnify and hold harmless the Buyer and its stockholders, partners, members, officers, directors,
employees and direct or indirect investors and any of the foregoing persons’ agents or other representatives (including,
without limitation, those retained in connection with the transactions contemplated by this Agreement) (collectively, the “Indemnitees”)
from and against any and all actions, causes of action, suits, claims, losses, costs, penalties, fees, liabilities and damages,
and expenses in connection therewith (irrespective of whether any such Indemnitee is a party to the action for which indemnification
hereunder is sought), and including reasonable attorneys’ fees and disbursements (the “Indemnified Liabilities”),
incurred by any Indemnitee as a result of, or arising out of, or relating to (a) any misrepresentation or breach of any representation
or warranty made by the Company in this Agreement, the Note or the Warrant or any other agreement, certificate, instrument or document
contemplated hereby or thereby, (b) any breach of any covenant, agreement or obligation of the Company contained in this Agreement,
the Note or the Warrant or any other agreement, certificate, instrument or document contemplated hereby or thereby or (c) any cause
of action, suit or claim brought or made against such Indemnitee by a third party (including for these purposes a derivative action
brought on behalf of the Company) and arising out of or resulting from (i) the execution, delivery, performance or enforcement
of this Agreement, the Note, the Warrant or the Registration Rights Agreement or any other agreement, certificate, instrument or
document contemplated hereby or thereby, (ii) any transaction financed or to be financed in whole or in part, directly or indirectly,
with the proceeds of the issuance of the Securities, or (iii) the status of the Buyer or holder of the Securities as an investor
in the Company pursuant to the transactions contemplated by this Agreement. To the extent that the foregoing undertaking by the
Company may be unenforceable for any reason, the Company shall make the maximum contribution to the payment and satisfaction of
each of the Indemnified Liabilities that is permissible under applicable law.


 


o. Payment Set
Aside. To the extent that the Company makes a payment or payments to the Buyer hereunder or pursuant to the Note or the Warrant,
or the Buyer enforces or exercises its rights hereunder or 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
or entity under any law (including, without limitation, any bankruptcy law, foreign, 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.


 


p. Failure or
Indulgence Not Waiver. No failure or delay on the part of the Buyer in the exercise of any power, right or privilege hereunder
or under the Note, the Warrant or the Registration Rights Agreement shall operate as a waiver thereof, nor shall any single or
partial exercise of any such power, right or privilege preclude other or further exercise thereof or of any other right, power
or privileges. All rights and remedies of the Buyer existing hereunder and thereunder are cumulative to, and not exclusive of,
any rights or remedies otherwise available.


 


 


 


[Signature Page Follows]


 



     

     

    

 


IN WITNESS WHEREOF,
the undersigned Buyer and the Company have caused this Agreement to be duly executed as of the date first above written.


 


HISPANICA
INTERNATIONAL DELIGHTS OF AMERICA, INC.


 


 


 


	By:	 	 
	 	Fernando Oswaldo Leonzo.	 
	 	Title:  Chied Executive Officer	 


 


 


[ ]


 


By: [ ]


 


 


 


	By:	 	 
	 	Name:	 
	 	Title:	 
	 	 	 
	 	Address:	 


 


 


SUBSCRIPTION AMOUNT:


 


	Principal Amount: $	 
	Actual Amount of Purchase Price: $              	 


 


 


 



     

     

    



 


Schedule 3a


Company’s Subsidiaries


Energy Source Distributors, Inc.,
a California corporation