EXHIBIT
10.1


 


PURCHASE
AGREEMENT


 


THIS
PURCHASE AGREEMENT (the “Agreement”), dated as of October 12, 2015 (the “Effective Date”)
by and between CACHET FINANCIAL SOLUTIONS, INC., a Delaware corporation (the “Company”),
and LINCOLN PARK CAPITAL FUND, LLC, an Illinois limited liability company (the “Investor”).


 


WHEREAS:


 


Subject
to the terms and conditions set forth in this Agreement, the Company wishes to sell to the Investor, and the Investor wishes to
buy from the Company, up to Ten Million Dollars ($10,000,000) of the Company’s common stock, $0.0001 par value per share
(the “Common Stock”). The shares of Common Stock to be purchased hereunder are referred to herein as the “Purchase
Shares.”


 


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


 


1.
CERTAIN DEFINITIONS.


 


For
purposes of this Agreement, the following terms shall have the following meanings:


 


(a)
“Accelerated Purchase Share Amount” means, with respect to any Accelerated Purchase made pursuant to Section
2(c) hereof, the number of Purchase Shares directed by the Company to be purchased by the Investor on an Accelerated Purchase
Notice, which number of Purchase Shares shall not exceed the lesser of (i) 300% of the number of Purchase Shares to be purchased
by the Investor pursuant to the corresponding Regular Purchase Notice for the corresponding Regular Purchase referred to in Section
2(c) hereof (subject to the Purchase Share limitations contained in Section 2(a) hereof) and (ii) the Accelerated Purchase
Share Percentage multiplied by the trading volume of the Common Stock on the Principal Market during normal trading hours on the
Accelerated Purchase Date.


 


(b)
“Accelerated Purchase Date” means, with respect to any Accelerated Purchase made pursuant to Section 2(c)
hereof, the Business Day immediately following the applicable Purchase Date with respect to the corresponding Regular Purchase
referred to in Section 2(c) hereof.


 


(c)
“Accelerated Purchase Notice” means, with respect to any Accelerated Purchase made pursuant to Section 2(c)
hereof, an irrevocable written notice from the Company to the Investor directing the Investor to buy a specified Accelerated
Purchase Share Amount on the applicable Accelerated Purchase Date pursuant to Section 2(c) hereof at the applicable Accelerated
Purchase Price.


 


(d)
“Accelerated Purchase Share Percentage” means, with respect to any Accelerated Purchase made pursuant to Section
2(c) hereof, thirty percent (30%).


 


(e)
“Accelerated Purchase Price” means, with respect to any particular Accelerated Purchase made pursuant to Section
2(c) hereof, the lower of (i) ninety-four percent (94%) of the VWAP during (A) the entire trading day on the Accelerated Purchase
Date, if the volume of shares of Common Stock traded on the Principal Market on the Accelerated Purchase Date has not exceeded
the Accelerated Purchase Share Volume Maximum, or (B) the portion of the trading day of the Accelerated Purchase Date (calculated
starting at the beginning of normal trading hours) until such time at which the volume of shares of Common Stock traded on the
Principal Market has exceeded the Accelerated Purchase Share Volume Maximum or (ii) the Closing Sale Price on the Accelerated
Purchase Date (to be appropriately adjusted for any reorganization, recapitalization, non-cash dividend, stock split, reverse
stock split or other similar transaction).


 




    	



    	 



    

 


(f)
“Accelerated Purchase Share Volume Maximum” means a certain number of shares of Common Stock traded on the
Principal Market during normal trading hours on the Accelerated Purchase Date equal to (i) the amount of shares of Common Stock
properly directed by the Company to be purchased on the Accelerated Purchase Notice, divided by (ii) the Accelerated Purchase
Share Percentage (to be appropriately adjusted for any reorganization, recapitalization, non-cash dividend, stock split, reverse
stock split or other similar transaction).


 


(g)
“Available Amount” means, initially, Ten Million Dollars ($10,000,000) in the aggregate, which amount shall
be reduced by the Purchase Amount each time the Investor purchases shares of Common Stock pursuant to Section 2 hereof.


 


(h)
“Bankruptcy Law” means Title 11, U.S. Code, or any similar federal or state law for the relief of debtors.


 


(i)
“Business Day” means any day on which the Principal Market is open for trading, including any day on which
the Principal Market is open for trading for a period of time less than the customary time.


 


(j)
“Closing Sale Price” means, for any security as of any date, the last closing sale price for such security
on the Principal Market as reported by the Principal Market.


 


(k)
“Confidential Information” means any information disclosed by either party to the other party, either directly
or indirectly, in writing, orally or by inspection of tangible objects (including, without limitation, documents, prototypes,
samples, plant and equipment), which is designated as “Confidential,” “Proprietary” or some similar designation.
Information communicated orally shall be considered Confidential Information if such information is confirmed in writing as being
Confidential Information within ten (10) Business Days after the initial disclosure. Confidential Information may also include
information disclosed to a disclosing party by third parties. Confidential Information shall not, however, include any information
which (i) was publicly known and made generally available in the public domain prior to the time of disclosure by the disclosing
party; (ii) becomes publicly known and made generally available after disclosure by the disclosing party to the receiving party
through no action or inaction of the receiving party; (iii) is already in the possession of the receiving party at the time of
disclosure by the disclosing party as shown by the receiving party’s files and records immediately prior to the time of
disclosure; (iv) is obtained by the receiving party from a third party without a breach of such third party’s obligations
of confidentiality; (v) is independently developed by the receiving party without use of or reference to the disclosing party’s
Confidential Information, as shown by documents and other competent evidence in the receiving party’s possession; or (vi)
is required by law to be disclosed by the receiving party, provided that the receiving party gives the disclosing party prompt
written notice of such requirement prior to such disclosure and assistance in obtaining an order protecting the information from
public disclosure.


 


(l)
“Custodian” means any receiver, trustee, assignee, liquidator or similar official under any Bankruptcy Law.


 




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(m)
“DTC” means The Depository Trust Company, or any successor performing substantially the same function for the
Company.


 


(n)
“DWAC Shares” means shares of Common Stock that are (i) issued in electronic form, (ii) freely tradable and
transferable and without restriction on resale and (iii) timely credited by the Company to the Investor’s or its designee’s
specified Deposit/Withdrawal at Custodian (DWAC) account with DTC under its Fast Automated Securities Transfer (FAST) Program,
or any similar program hereafter adopted by DTC performing substantially the same function.


 


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


 


(p)
“Material Adverse Effect” means any material adverse effect on (i) the enforceability of any Transaction Document,
(ii) the results of operations, assets, business or financial condition of the Company and its Subsidiaries, taken as a whole,
other than any material adverse effect that resulted exclusively from (A) any change in the United States or foreign economies
or securities or financial markets in general that does not have a disproportionate effect on the Company and its Subsidiaries,
taken as a whole, (B) any change that generally affects the industry in which the Company and its Subsidiaries operate that does
not have a disproportionate effect on the Company and its Subsidiaries, taken as a whole, (C) any change arising in connection
with earthquakes, hostilities, acts of war, sabotage or terrorism or military actions or any escalation or material worsening
of any such hostilities, acts of war, sabotage or terrorism or military actions existing as of the date hereof, (D) any action
taken by the Investor, its affiliates or its or their successors and assigns with respect to the transactions contemplated by
this Agreement, (E) the effect of any change in applicable laws or accounting rules that does not have a disproportionate effect
on the Company and its Subsidiaries, taken as a whole, or (F) any change resulting from compliance with terms of this Agreement
or the consummation of the transactions contemplated by this Agreement, or (iii) the Company’s ability to perform in any
material respect on a timely basis its obligations under any Transaction Document to be performed as of the date of determination.


 


(q)
“Maturity Date” means the first day of the month immediately following the thirty-sixth (36) month anniversary
of the Commencement Date.


 


(r)
“PEA Period” means the period commencing at 9:30 a.m., Eastern time, on the twentieth (20th) Business Day immediately
prior to the filing of any post-effective amendment to the Registration Statement (as defined herein) or New Registration Statement
(as such term is defined in the Registration Rights Agreement), and ending at 9:30 a.m., Eastern time, on the Business Day immediately
following, the effective date of any post-effective amendment to the Registration Statement (as defined herein) or New Registration
Statement (as such term is defined in the Registration Rights Agreement).


 


(s)
“Person” means an individual or entity including but not limited to any limited liability company, a partnership,
a joint venture, a corporation, a trust, an unincorporated organization and a government or any department or agency thereof.


 


(t)
“Principal Market” means the OTCBB (or any nationally recognized successor thereto); provided, however, that
in the event the Company’s Common Stock is ever listed or traded on The NASDAQ Capital Market, The NASDAQ Global Market,
The NASDAQ Global Select Market, the New York Stock Exchange, the NYSE MKT, the OTCQB or the OTCQX operated by the OTC Markets
Group, Inc. (or any nationally recognized successor to any of the foregoing), then the “Principal Market” shall mean
such other market or exchange on which the Common Stock is then listed or traded.


 




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(u)
“Purchase Amount” means, with respect to any Regular Purchase, Additional Purchase or any Accelerated Purchase
made hereunder, the portion of the Available Amount to be purchased by the Investor pursuant to Section 2 hereof.


 


(v)
“Purchase Date” means, with respect to any Regular Purchase or Additional Purchase made pursuant to Section
2(a) or Section 2(b) hereof, the Business Day on which the Investor receives by 7:00 p.m., Eastern time, on such Business
Day a valid Regular Purchase Notice or Additional Purchase Notice, as applicable, that the Investor is to buy Purchase Shares
pursuant to Section 2(a) or Section 2(b) hereof.


 


(w)
“Purchase Price” means, with respect to any Regular Purchase made pursuant to Section 2(a) hereof, the lower
of: (i) the lowest Sale Price on the applicable Purchase Date and (ii) the arithmetic average of the three (3) lowest Closing
Sale Prices for the Common Stock during the twelve (12) consecutive Business Days ending on the Business Day immediately preceding
such Purchase Date (in each case, to be appropriately adjusted for any reorganization, recapitalization, non-cash dividend, stock
split or other similar transaction that occurs on or after the date of this Agreement).


 


(x)
“Regular Purchase Notice” means, with respect to any Regular Purchase pursuant to Section 2(a) hereof,
an irrevocable written notice from the Company to the Investor directing the Investor to buy such applicable amount of Purchase
Shares at the applicable Purchase Price as specified by the Company therein on the Purchase Date.


 


(y)
“Sale Price” means any trade price for the shares of Common Stock on the Principal Market as reported by the
Principal Market.


 


(z)
“SEC” means the U.S. Securities and Exchange Commission.


 


(aa)
“Securities” means, collectively, the Purchase Shares and the Commitment Shares.


 


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


 


(cc)
“Subsidiary” means any Person the Company wholly-owns or controls, or in which the Company, directly or indirectly,
owns a majority of the voting stock or similar voting interest, in each case that would be disclosable pursuant to Item 601(b)(21)
of Regulation S-K promulgated under the Securities Act.


 


(dd)
“Transaction Documents” means, collectively, this Agreement and the schedules and exhibits hereto, the Registration
Rights Agreement and the schedules and exhibits thereto, and each of the other agreements, documents, certificates and instruments
entered into or furnished by the parties hereto in connection with the transactions contemplated hereby and thereby.


 


(ee)
“Transfer Agent” means Corporate Stock Transfer, Inc., or such other Person who is then serving as the transfer
agent for the Company in respect of the Common Stock.


 


(ff)
“VWAP” means in respect of an applicable Accelerated Purchase Date, the volume weighted average price of the
Common Stock on the Principal Market, as reported on the Principal Market.


 




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2.
PURCHASE OF COMMON STOCK.


 


Subject
to the terms and conditions set forth in this Agreement, the Company has the right to sell to the Investor, and the Investor has
the obligation to purchase from the Company, Purchase Shares as follows:


 


(a)
Commencement of Regular Sales of Common Stock. Upon the satisfaction of the conditions set forth in Sections 7 and
8 hereof (the “Commencement” and the date of satisfaction of such conditions the “Commencement
Date”) and thereafter, the Company shall have the right, but not the obligation, to direct the Investor, by its delivery
to the Investor of a Regular Purchase Notice from time to time, to purchase up to Fifty Thousand (50,000) Purchase Shares (each
such purchase a “Regular Purchase”), at the Purchase Price on the Purchase Date; provided, however,
that (i) the Regular Purchase may be increased to up to Seventy-Five Thousand (75,000) Purchase Shares, provided that the Closing
Sale Price of the Common Stock is not below $1.00 on the Purchase Date, (ii) the Regular Purchase may be increased to up to One
Hundred Thousand (100,000) Purchase Shares, provided that the Closing Sale Price of the Common Stock is not below $1.50 and (iii)
the Regular Purchase may be increased to up to Two Hundred Thousand (200,000) Purchase Shares, provided that the Closing Sale
Price of the Common Stock is not below $2.50 on the Purchase Date (all of which share and dollar amounts shall be appropriately
adjusted for any reorganization, recapitalization, non-cash dividend, stock split or other similar transaction); provided,
further, however, that the Investor’s committed obligation under any single Regular Purchase shall not exceed
Five Hundred Thousand Dollars ($500,000). If the Company delivers any Regular Purchase Notice for a Purchase Amount in excess
of the limitations contained in the immediately preceding sentence, such Regular Purchase Notice shall be void ab initio
to the extent of the amount by which the amount of Purchase Shares set forth in such Regular Purchase Notice exceeds the amount
of Purchase Shares which the Company is permitted to include in such Purchase Notice in accordance herewith, and the Investor
shall have no obligation to purchase such excess Purchase Shares in respect of such Regular Purchase Notice; provided that the
Investor shall remain obligated to purchase the amount of Purchase Shares which the Company is permitted to include in such Regular
Purchase Notice. The Company may deliver multiple Regular Purchase Notices to the Investor so long as at least one (1) Business
Day has passed since the most recent Regular Purchase was completed. Notwithstanding the foregoing, the Company shall not deliver
any Regular Purchase Notices during the PEA Period.


 


(b)
Additional Purchases. Subject to the terms and conditions of this Agreement, in addition to purchases of Purchase Shares
as described in Section 2(a) above, the Company shall have the right but not the obligation at any time on or after
the Commencement Date to direct the Investor to purchase up to One Hundred Thousand Dollars ($100,000) of Purchase Shares (such
purchases of additional Purchase Shares, “Additional Purchases”) at ninety-four percent (94%) of the Purchase
Price on the Purchase Date, by delivery to the Investor of written notice thereof (each such notice, an “Additional Purchase
Notice”) from time to time. The Company may deliver multiple Additional Purchase Notices to the Investor so long as
at least six (6) Business Days have passed since the most recent Additional Purchase was completed. Notwithstanding the foregoing,
the Company shall not deliver any Additional Purchase Notices during the PEA Period.


 




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(c)
Accelerated Purchases. Subject to the terms and conditions of this Agreement, in addition to purchases of Purchase Shares
as described in Section 2(a) and (b) above, the Company shall also have the right, but not the obligation,
to direct the Investor by the Company’s delivery to the Investor of an Accelerated Purchase Notice from time to time, and
the Investor thereupon shall have the obligation, to buy Purchase Shares at the Accelerated Purchase Price on the Accelerated
Purchase Date in an amount equal to the Accelerated Purchase Share Amount (each such purchase, an “Accelerated Purchase”).
The Company may deliver an Accelerated Purchase Notice to the Investor only on a Purchase Date on which the Company also properly
submitted a Regular Purchase Notice for a Regular Purchase and the Closing Sale Price is not below $1.00 (to be appropriately
adjusted for any reorganization, recapitalization, non-cash dividend, stock split or other similar transaction). If the Company
delivers any Accelerated Purchase Notice for an Accelerated Purchase Share Amount in excess of the limitations contained in the
definition of Accelerated Purchase Share Amount, such Accelerated Purchase Notice shall be void ab initio to the extent
of the amount by which the number of Purchase Shares set forth in such Accelerated Purchase Notice exceeds the Accelerated Purchase
Share Amount which the Company is permitted to include in such Accelerated Purchase Notice in accordance herewith (which shall
be confirmed in an Accelerated Purchase Confirmation (defined below)), and the Investor shall have no obligation to purchase such
excess Purchase Shares in respect of such Accelerated Purchase Notice; provided that the Investor shall remain obligated to purchase
the Accelerated Purchase Share Amount which the Company is permitted to include in such Accelerated Purchase Notice. Upon completion
of each Accelerated Purchase, the Accelerated Purchase Share Amount and the applicable Accelerated Purchase Price shall be set
forth on a confirmation of the Accelerated Purchase to be provided to the Company by the Investor (an “Accelerated Purchase
Confirmation”).


 


(d)
Payment for Purchase Shares. For each Regular Purchase and Additional Purchase, the Investor shall pay to the Company an
amount equal to the Purchase Amount with respect to such Regular Purchase or Additional Purchase (as applicable) as full payment
for such Purchase Shares via wire transfer of immediately available funds on the same Business Day that the Investor receives
such Purchase Shares, if such Purchase Shares are received by the Investor before 1:00 p.m., Eastern time, or, if such Purchase
Shares are received by the Investor after 1:00 p.m., Eastern time, the next Business Day. For each Accelerated Purchase, the Investor
shall pay to the Company an amount equal to the Purchase Amount with respect to such Accelerated Purchase as full payment for
such Purchase Shares via wire transfer of immediately available funds on the third Business Day following the date that the Investor
receives such Purchase Shares. If the Company or the Transfer Agent shall fail for any reason or for no reason to electronically
transfer any Purchase Shares as DWAC Shares in respect of a Regular Purchase, Additional Purchase or Accelerated Purchase (as
applicable) within three (3) Business Days following the receipt by the Company of the Purchase Price or Accelerated Purchase
Price, respectively, therefor in compliance with this Section 2(d), and if on or after such Business Day the Investor
purchases (in an open market transaction or otherwise) shares of Common Stock to deliver in satisfaction of a sale by the Investor
of such Purchase Shares that the Investor anticipated receiving from the Company in respect of such Regular Purchase, Additional
Purchase or Accelerated Purchase (as applicable), then the Company shall, within three (3) Business Days after the Investor’s
request, either (i) pay cash to the Investor in an amount equal to the Investor’s total purchase price (including brokerage
commissions, if any) for the shares of Common Stock so purchased (the “Cover Price”), at which point the Company’s
obligation to deliver such Purchase Shares as DWAC Shares shall terminate, or (ii) promptly honor its obligation to deliver to
the Investor such Purchase Shares as DWAC Shares and pay cash to the Investor in an amount equal to the excess (if any) of the
Cover Price over the total Purchase Price for such Regular Purchase and such Additional Purchase plus the total Accelerated Purchase
Price for such Accelerated Purchase (as applicable). The Company shall not issue any fraction of a share of Common Stock upon
any Regular Purchase, Additional Purchase or Accelerated Purchase. If the issuance would result in the issuance of a fraction
of a share of Common Stock, the Company shall round such fraction of a share of Common Stock up or down to the nearest whole share.
All payments made under this Agreement shall be made in lawful money of the United States of America by wire transfer of immediately
available funds to such account as the Company may from time to time designate by written notice in accordance with the provisions
of this Agreement. Whenever any amount expressed to be due by the terms of this Agreement is due on any day that is not a Business
Day, the same shall instead be due on the next succeeding day that is a Business Day.


 




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(e)
Beneficial Ownership Limitation. Notwithstanding anything to the contrary contained in this Agreement, the Company shall
not issue or sell, and the Investor shall not purchase or acquire, any shares of Common Stock under this Agreement which, when
aggregated with all other shares of Common Stock then beneficially owned by the Investor and its affiliates (as calculated pursuant
to Section 13(d) of the Exchange Act and Rule 13d-3 promulgated thereunder), would result in the beneficial ownership by the Investor
and its affiliates of more than 9.99% of the then issued and outstanding shares of Common Stock (the “Beneficial Ownership
Limitation”). Upon the written or oral request of the Investor, the Company shall promptly (but not later than 24 hours)
confirm orally or in writing to the Investor the number of shares of Common Stock then outstanding. The Investor and the Company
shall each cooperate in good faith in the determinations required hereby and the application hereof. The Investor’s written
certification to the Company of the applicability of the Beneficial Ownership Limitation, and the resulting effect thereof hereunder
at any time, shall be conclusive with respect to the applicability thereof and such result absent manifest error.


 


3.
INVESTOR’S REPRESENTATIONS AND WARRANTIES.


 


The
Investor represents and warrants to the Company that as of the date hereof and as of the Commencement Date:


 


(a)
Investment Purpose. The Investor is acquiring the Securities as principal for its own account and not with a view to or
for distributing or reselling such Securities or any part thereof in violation of the Securities Act or any applicable state securities
law, has no present intention of distributing any of such Securities in violation of the Securities Act or any applicable state
securities law and has no direct or indirect arrangement or understandings with any other Persons to distribute or regarding the
distribution of such Securities in violation of the Securities Act or any applicable state securities law (this representation
and warranty not limiting the Investor’s right to sell the Securities at any time pursuant to the Registration Statement
described herein or otherwise in compliance with applicable federal and state securities laws). The Investor is acquiring the
Securities hereunder in the ordinary course of its business.


 


(b)
Accredited Investor Status. The Investor is an “accredited investor” as that term is defined in Rule 501(a)(3)
of Regulation D promulgated under the Securities Act.


 


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


 


(d)
Information. The Investor understands that its investment in the Securities involves a high degree of risk. The Investor
(i) is able to bear the economic risk of an investment in the Securities including a total loss thereof, (ii) has such knowledge
and experience in financial and business matters that it is capable of evaluating the merits and risks of the proposed investment
in the Securities and (iii) has had an opportunity to ask questions of and receive answers from the officers of the Company concerning
the financial condition and business of the Company and others matters related to an investment in the Securities. Neither such
inquiries nor any other due diligence investigations conducted by the Investor or its representatives shall modify, amend or affect
the Investor’s right to rely on the Company’s representations and warranties contained in Section 4 below.
The Investor has sought such accounting, legal and tax advice as it has considered necessary to make an informed investment decision
with respect to its acquisition of the Securities.


 




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(e)
No Governmental Review. The Investor understands that no U.S. federal or state agency or any other government or governmental
agency has passed on or made any recommendation or endorsement of the Securities or the fairness or suitability of an investment
in the Securities nor have such authorities passed upon or endorsed the merits of the offering of the Securities.


 


(f)
Transfer or Sale. The Investor understands that (i) the Securities may not be offered for sale, sold, assigned or transferred
unless (A) registered pursuant to the Securities Act or (B) an exemption exists permitting such Securities to be sold, assigned
or transferred without such registration; (ii) any sale of the Securities made in reliance on Rule 144 may be made only in accordance
with the terms of Rule 144 and further, if Rule 144 is not applicable, any resale of the 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 Securities
Act) may require compliance with some other exemption under the Securities Act or the rules and regulations of the SEC thereunder.


 


(g)
Validity; Enforcement. This Agreement has been duly and validly authorized, executed and delivered on behalf of the Investor
and is a valid and binding agreement of the Investor enforceable against the Investor in accordance with its terms, subject as
to enforceability to general principles of equity and to applicable bankruptcy, insolvency, reorganization, moratorium, liquidation
and other similar laws relating to, or affecting generally, the enforcement of applicable creditors’ rights and remedies.


 


(h)
Residency. The Investor is a resident of the State of Illinois.


 


(i)
No Short Selling. The Investor represents and warrants to the Company that at no time prior to the date of this Agreement
has any of the Investor, its agents, representatives or affiliates engaged in or effected, in any manner whatsoever, directly
or indirectly, any (i) “short sale” (as such term is defined in Rule 200 of Regulation SHO of the Exchange Act) of
the Common Stock or (ii) hedging transaction, which establishes a net short position with respect to the Common Stock.


 


4.
REPRESENTATIONS AND WARRANTIES OF THE COMPANY.


 


The
Company represents and warrants to the Investor that as of the date hereof and as of the Commencement Date:


 


(a)
Organization and Qualification. The Company and each of its Subsidiaries is an entity duly incorporated or otherwise organized,
validly existing and in good standing under the laws of the jurisdiction of its incorporation or organization, with the requisite
corporate power and authority to own and use its properties and assets and to carry on its business as currently conducted. Neither
the Company nor any of its Subsidiaries is in violation or default of any of the provisions of its respective Certificate of Incorporation,
bylaws or other organizational or charter documents. Each of the Company and its Subsidiaries is duly qualified to conduct business
and is in good standing as a foreign corporation or other entity in each jurisdiction in which the nature of the business conducted
or property owned by it makes such qualification necessary, except where the failure to be so qualified or in good standing, as
the case may be, could not have or reasonably be expected to result in a Material Adverse Effect and no proceeding has been instituted
in any such jurisdiction revoking, limiting or curtailing or seeking to revoke, limit or curtail such power and authority or qualification.
The Company has no Subsidiaries except as set forth in Schedule 4(a) hereof.


 




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(b)
Authorization; Enforcement; Validity. (i) The Company has the requisite corporate power and authority to enter into and
perform its obligations under this Agreement and each of the other Transaction Documents, and to issue the Securities in accordance
with the terms hereof and thereof, (ii) the execution and delivery of the Transaction Documents by the Company and the consummation
by it of the transactions contemplated hereby and thereby, including without limitation, the issuance of the Commitment Shares
(as defined below in Section 5(e)) and the reservation for issuance and the issuance of the Purchase Shares issuable
under this Agreement, have been duly authorized by the Company’s Board of Directors and no further consent or authorization
is required by the Company, its Board of Directors or its stockholders, (iii) this Agreement has been, and each other Transaction
Document shall be on the Commencement Date, duly executed and delivered by the Company and (iv) this Agreement constitutes, and
each other Transaction Document upon its execution on behalf of the Company, shall constitute, the valid and binding obligations
of the Company enforceable against the Company in accordance with their terms, except as such enforceability may be limited by
general principles of equity or applicable bankruptcy, insolvency, reorganization, moratorium, liquidation or similar laws relating
to, or affecting generally, the enforcement of creditors’ rights and remedies. The Board of Directors of the Company has
approved the resolutions (the “Signing Resolutions”) substantially in the form as set forth as Exhibit C
attached hereto to authorize this Agreement and the transactions contemplated hereby. The Signing Resolutions are valid, in
full force and effect and have not been modified or supplemented in any respect. The Company has delivered to the Investor a true
and correct copy of a unanimous written consent adopting the Signing Resolutions executed by all of the members of the Board of
Directors of the Company. Except as set forth in this Agreement, no other approvals or consents of the Company’s Board of
Directors, any authorized committee thereof, and/or stockholders is necessary under applicable laws and the Company’s Certificate
of Incorporation and/or Bylaws to authorize the execution and delivery of this Agreement or any of the transactions contemplated
hereby, including, but not limited to, the issuance of the Commitment Shares and the issuance of the Purchase Shares.


 


(c)
Capitalization. As of the date hereof, the authorized capital stock of the Company is set forth in Schedule 4(c)
hereof. Except as disclosed in the SEC Documents (as defined below), (i) no shares of the Company’s capital stock are subject
to preemptive rights or any other similar rights or any liens or encumbrances caused by the Company, (ii) there are no outstanding
debt securities, (iii) there are no outstanding options, warrants, scrip, rights to subscribe to, calls or commitments of any
character whatsoever relating to, or securities or rights convertible into, any shares of capital stock of the Company or any
of its Subsidiaries, or contracts, commitments, understandings 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 or options, warrants,
scrip, rights to subscribe to, calls or commitments of any character whatsoever relating to, or securities or rights convertible
into, any shares of capital stock of the Company or any of its Subsidiaries, (iv) there are no agreements or arrangements under
which the Company or any of its Subsidiaries is obligated to register the sale of any of their securities under the Securities
Act (except the Registration Rights Agreement), (v) there are no outstanding securities or instruments of the Company or any of
its Subsidiaries which contain any redemption or similar provisions, and there are no contracts, commitments, understandings or
arrangements by which the Company or any of its Subsidiaries is or may become bound to redeem a security of the Company or any
of its Subsidiaries, (vi) there are no securities or instruments containing anti-dilution or similar provisions that will be triggered
by the issuance of the Securities as described in this Agreement and (vii) the Company does not have any stock appreciation rights
or “phantom stock” plans or agreements or any similar plan or agreement. The Company has furnished to the Investor
true and correct copies of the Company’s Certificate of Incorporation, as amended and as in effect on the date hereof (the
“Certificate of Incorporation”), and the Company’s Bylaws, as amended and as in effect on the date hereof
(the “Bylaws”), and, except with respect to securities described in the SEC Documents, summaries of the terms
of all securities convertible into or exercisable for Common Stock, if any, and copies of any documents containing the material
rights of the holders thereof in respect thereto.


 




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(d)
Issuance of Securities. Upon issuance and payment therefor in accordance with the terms and conditions of this Agreement,
the Purchase Shares shall be validly issued, fully paid and nonassessable and free from all taxes, liens, charges, restrictions,
rights of first refusal and preemptive rights with respect to the issue thereof, with the holders being entitled to all rights
accorded to a holder of Common Stock. 12,000,000 shares of Common Stock have been duly authorized and reserved for issuance upon
purchase under this Agreement as Purchase Shares. 416,666 shares of Common Stock (subject to equitable adjustment for any reorganization,
recapitalization, non-cash dividend, stock split or other similar transaction) have been duly authorized and reserved for issuance
as Commitment Shares (as defined below in Section 5(e)) in accordance with this Agreement. The Commitment Shares shall
be validly issued, fully paid and nonassessable and free from all taxes, liens, charges, restrictions, rights of first refusal
and preemptive rights with respect to the issue thereof, with the holders being entitled to all rights accorded to a holder of
Common Stock.


 


(e)
No Conflicts. The execution, delivery and performance of the Transaction Documents by the Company and the consummation
by the Company of the transactions contemplated hereby and thereby (including, without limitation, the reservation for issuance
and issuance of the Purchase Shares and the Commitment Shares) will not (i) result in a violation of the Certificate of Incorporation,
any Certificate of Designations, Preferences and Rights of any outstanding series of preferred stock of the Company or the Bylaws
or (ii) conflict with, or constitute a default (or an event which with notice or lapse of time or both would become a default)
under, or 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 result in a violation of any law, rule, regulation, order, judgment
or decree (including federal and state securities laws and regulations and the rules and regulations of the Principal Market 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 in the case of conflicts, defaults, terminations, amendments, accelerations, cancellations and violations
under clause (ii), which could not reasonably be expected to result in a Material Adverse Effect. Neither the Company nor its
Subsidiaries is in violation of any term of or in default under its Certificate of Incorporation, any Certificate of Designation,
Preferences and Rights of any outstanding series of preferred stock of the Company or Bylaws or their organizational charter or
bylaws, respectively. Neither the Company nor any of its Subsidiaries is in violation of any term of or is in default under any
material contract, agreement, mortgage, indebtedness, indenture, instrument, judgment, decree or order or any statute, rule or
regulation applicable to the Company or its Subsidiaries, except for possible conflicts, defaults, terminations or amendments
that could not reasonably be expected to have a Material Adverse Effect. The business of the Company and its Subsidiaries is not
being conducted, and shall not be conducted, in violation of any law, ordinance, regulation of any governmental entity, except
for possible violations, the sanctions for which either individually or in the aggregate could not reasonably be expected to have
a Material Adverse Effect. Except as specifically contemplated by this Agreement and as required under the Securities Act or applicable
state securities laws and the rules and regulations of the Principal Market, the Company is not required to obtain any consent,
authorization or order of, or make any filing or registration with, any court or governmental agency or any regulatory or self-regulatory
agency in order for it to execute, deliver or perform any of its obligations under or contemplated by the Transaction Documents
in accordance with the terms hereof or thereof. Except as set forth elsewhere in this Agreement, all consents, authorizations,
orders, filings and registrations which the Company is required to obtain pursuant to the preceding sentence shall be obtained
or effected on or prior to the Commencement Date. Since one year prior to the date hereof, the Company has not received nor delivered
any notices or correspondence from or to the Principal Market. The Principal Market has not commenced any delisting proceedings
against the Company.


 




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(f)
SEC Documents; Financial Statements. The Company has filed all reports, schedules, forms, statements and other documents
required to be filed by the Company under the Securities Act and the Exchange Act, including pursuant to Section 13(a) or 15(d)
thereof, for the 24 months preceding the date hereof (or such shorter period as the Company was required by law or regulation
to file such material) (the foregoing materials, including the exhibits thereto and documents incorporated by reference therein,
being collectively referred to herein as the “SEC Documents”) on a timely basis or has received a valid extension
of such time of filing and has filed any such SEC Documents prior to the expiration of any such extension. As of their respective
dates, the SEC Documents complied in all material respects with the requirements of the Securities Act and the Exchange Act, as
applicable. None of the SEC Documents, when filed, contained any untrue statement of a material fact or omitted to state a material
fact required to be stated therein or necessary in order to make the statements therein, in the light of the circumstances under
which they were made, not misleading. The financial statements of the Company included in the SEC Documents comply in all material
respects with applicable accounting requirements and the rules and regulations of the SEC with respect thereto as in effect at
the time of filing. Such financial statements have been prepared in accordance with United States generally accepted accounting
principles applied on a consistent basis during the periods involved (“GAAP”), except as may be otherwise specified
in such financial statements or the notes thereto and except that unaudited financial statements may not contain all footnotes
required by GAAP, and fairly present in all material respects the financial position of the Company and its consolidated Subsidiaries
as of and for the dates thereof and the results of operations and cash flows for the periods then ended, subject, in the case
of unaudited statements, to normal, immaterial, year-end audit adjustments. Except for notices of effectiveness or no review,
or as set forth in the SEC Documents, the Company has received no notices or correspondence from the SEC for the one year preceding
the date hereof. The SEC has not commenced any enforcement proceedings against the Company or any of its Subsidiaries.


 


(g)
Absence of Certain Changes. Except as disclosed in the SEC Documents, since December 31, 2014, there has been no material
adverse change in the business, properties, operations, financial condition or results of operations of the Company or its Subsidiaries.
The Company has not taken any steps, and does not currently expect to take any steps, to seek protection pursuant to any Bankruptcy
Law nor does the Company or any of its Subsidiaries have any knowledge or reason to believe that its creditors intend to initiate
involuntary bankruptcy or insolvency proceedings.


 


(h)
Absence of Litigation. Except as set forth in Schedule 4(h) hereof, there is no action, suit, 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, the Common Stock or any of the Company’s
or its Subsidiaries’ officers or directors in their capacities as such, which could reasonably be expected to have a Material
Adverse Effect.


 


(i)
Acknowledgment Regarding Investor’s Status. The Company acknowledges and agrees that the Investor is acting solely
in the capacity of arm’s length purchaser with respect to the Transaction Documents and the transactions contemplated hereby
and thereby. The Company further acknowledges that the Investor is not 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 hereby and thereby and
any advice given by the Investor or any of its representatives or agents in connection with the Transaction Documents and the
transactions contemplated hereby and thereby is merely incidental to the Investor’s purchase of the Securities. The Company
further represents to the Investor that the Company’s decision to enter into the Transaction Documents has been based solely
on the independent evaluation by the Company and its representatives and advisors.


 




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(j)
No General Solicitation; No Integrated Offering. Neither the Company, nor any of its affiliates, nor any Person acting
on its or their behalf, has engaged in any form of general solicitation or general advertising (within the meaning of Regulation
D under the Securities Act) in connection with the offer or sale of the Securities. Neither the Company, nor or any of its affiliates,
nor any Person acting on their behalf has, directly or indirectly, made any offers or sales of any security or solicited any offers
to buy any security, under circumstances that would require registration of the offer and sale of any of the Securities under
the Securities Act, whether through integration with prior offerings or otherwise, or cause this offering of the Securities to
be integrated with prior offerings by the Company in a manner that would require stockholder approval pursuant to the rules of
the Principal Market on which any of the securities of the Company are listed or designated. The issuance and sale of the Securities
hereunder does not contravene the rules and regulations of the Principal Market.


 


(k)
Intellectual Property Rights. Except as set forth in Schedule 4(k) hereof, the Company and its Subsidiaries own or possess
adequate rights or licenses to use all material trademarks, trade names, service marks, service mark registrations, service names,
patents, patent rights, copyrights, inventions, licenses, approvals, governmental authorizations, trade secrets and rights necessary
to conduct their respective businesses as now conducted. None of the Company’s material trademarks, trade names, service
marks, service mark registrations, service names, patents, patent rights, copyrights, inventions, licenses, approvals, government
authorizations, trade secrets or other intellectual property rights have expired or terminated, or, by the terms and conditions
thereof, could expire or terminate within two years from the date of this Agreement. The Company and its Subsidiaries do not have
any knowledge of any infringement by the Company or its Subsidiaries of any material trademark, trade name rights, patents, patent
rights, copyrights, inventions, licenses, service names, service marks, service mark registrations, trade secret or other similar
rights of others, or of any such development of similar or identical trade secrets or technical information by others, and there
is no claim, action or proceeding being made or brought against, or to the Company’s knowledge, being threatened against,
the Company or its Subsidiaries regarding trademark, trade name, patents, patent rights, invention, copyright, license, service
names, service marks, service mark registrations, trade secret or other infringement, which could reasonably be expected to have
a Material Adverse Effect.


 


(l)
Environmental Laws. To the Company’s knowledge, the Company and its Subsidiaries (i) are in compliance with any and
all applicable foreign, federal, state and local laws and regulations relating to the protection of human health and safety, the
environment or hazardous or toxic substances or wastes, pollutants or contaminants (“Environmental Laws”),
(ii) have received all permits, licenses or other approvals required of them under applicable Environmental Laws to conduct their
respective businesses and (iii) are in compliance with all terms and conditions of any such permit, license or approval, except
where, in each of the three foregoing clauses, the failure to so comply could not reasonably be expected to have, individually
or in the aggregate, a Material Adverse Effect.


 


(m)
Title. Except as disclosed in the SEC Documents, the Company and its Subsidiaries have good and marketable title in fee
simple to all real property owned by them and good and marketable title in all personal property owned by them that is material
to the business of the Company and its Subsidiaries, in each case free and clear of all liens, encumbrances and defects (“Liens”)
and, except for Liens as do not materially affect the value of such property and do not materially interfere with the use made
and proposed to be made of such property by the Company and its Subsidiaries and Liens for the payment of federal, state or other
taxes, the payment of which is neither delinquent nor subject to penalties. 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 which the Company and
its Subsidiaries are in compliance with such exceptions as are not material and do not interfere with the use made and proposed
to be made of such property and buildings by the Company and its Subsidiaries.


 


(n)
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 been refused any insurance
coverage sought or applied for and 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 materially and adversely affect the condition, financial
or otherwise, or the earnings, business or operations of the Company and its Subsidiaries, taken as a whole.


 




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(o)
Regulatory Permits. The Company and its Subsidiaries possess all material certificates, authorizations and permits issued
by the appropriate federal, state or foreign regulatory authorities necessary to conduct their respective businesses, and neither
the Company nor any such Subsidiary has received any notice of proceedings relating to the revocation or modification of any such
certificate, authorization or permit.


 


(p)
Tax Status. The Company and each of its Subsidiaries has made or filed all federal and state income and all other material
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 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 provision reasonably adequate for the payment of all 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.


 


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


 


(r)
Application of Takeover Protections. The Company and its board of directors have taken or will take prior to the Commencement
Date all necessary action, if any, in order to render inapplicable any control share acquisition, business combination, poison
pill (including any distribution under a rights agreement) or other similar anti-takeover provision under the Certificate of Incorporation
or the laws of the state of its incorporation which is or could become applicable to the Investor as a result of the transactions
contemplated by this Agreement, including, without limitation, the Company’s issuance of the Securities and the Investor’s
ownership of the Securities.


 


(s)
Disclosure. Except with respect to the material terms and conditions of the transactions contemplated by the Transaction
Documents that will be timely publicly disclosed by the Company, the Company confirms that neither it nor any other Person acting
on its behalf has provided the Investor or its agents or counsel with any information that it believes constitutes or might constitute
material, non-public information which is not otherwise disclosed in the Registration Statement or the SEC Documents. The Company
understands and confirms that the Investor will rely on the foregoing representation in effecting purchases and sales of securities
of the Company. All of the disclosure furnished by or on behalf of the Company to the Investor regarding the Company, its business
and the transactions contemplated hereby, including the disclosure schedules to this Agreement, is true and correct and does not
contain any untrue statement of a material fact or omit to state any material fact necessary in order to make the statements made
therein, in light of the circumstances under which they were made, not misleading. The press releases disseminated by the Company
during the 12 months preceding the date of this Agreement taken as a whole do not contain any untrue statement of a material fact
or omit to state a material fact required to be stated therein or necessary in order to make the statements therein, in light
of the circumstances under which they were made and when made, not misleading. The Company acknowledges and agrees that the Investor
neither makes nor has made any representations or warranties with respect to the transactions contemplated hereby other than those
specifically set forth in Section 3 hereof.


 




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(t)
Foreign Corrupt Practices. Neither the Company, nor to the knowledge of the Company, any agent or other Person acting on
behalf of the Company, has (i) directly or indirectly, used any funds for unlawful contributions, gifts, entertainment or other
unlawful expenses related to foreign or domestic political activity, (ii) made any unlawful payment to foreign or domestic government
officials or employees or to any foreign or domestic political parties or campaigns from corporate funds, (iii) failed to disclose
fully any contribution made by the Company (or made by any Person acting on its behalf of which the Company is aware) which is
in violation of law, or (iv) violated in any material respect any provision of the Foreign Corrupt Practices Act of 1977, as amended.


 


(u)
DTC Eligibility. The Company, through the Transfer Agent, currently participates in the DTC Fast Automated Securities Transfer
(FAST) Program and the Common Stock can be transferred electronically to third parties via the DTC Fast Automated Securities Transfer
(FAST) Program.


 


(v)
Sarbanes-Oxley. The Company is in compliance with all provisions of the Sarbanes-Oxley Act of 2002, as amended, which are
applicable to it as of the date hereof.


 


(w)
Certain Fees. Except as disclosed on Schedule 4(w), no brokerage or finder’s fees or commissions are or will
be payable by the Company to any broker, financial advisor or consultant, finder, placement agent, investment banker, bank or
other Person with respect to the transactions contemplated by the Transaction Documents. Except as disclosed on Schedule 4(w),
the Investor shall have no obligation with respect to any fees or with respect to any claims made by or on behalf of other Persons
for fees of a type contemplated in this Section 4(w) that may be due in connection with the transactions contemplated by
the Transaction Documents.


 


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


 


(y)
Listing and Maintenance Requirements. The Common Stock is registered pursuant to Section 12(b) or 12(g) of the Exchange
Act, and the Company has taken no action designed to, or which to its knowledge is likely to have the effect of, terminating the
registration of the Common Stock pursuant to the Exchange Act nor has the Company received any notification that the SEC is currently
contemplating terminating such registration. The Company has not, in the twelve (12) months preceding the date hereof, received
any notice from any Person to the effect that the Company is not in compliance with the listing or maintenance requirements of
the Principal Market. The Company is, and has no reason to believe that it will not in the foreseeable future continue to be,
in compliance with all such listing and maintenance requirements.


 


(z)
Accountants. The Company’s accountants are set forth in the SEC Documents and, to the knowledge of the Company, such
accountants are an independent registered public accounting firm as required by the Securities Act.


 




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(aa)
No Market Manipulation. The Company has not, and to its knowledge no Person acting on its behalf has, (i) taken, directly
or indirectly, any action designed to cause or to result in the stabilization or manipulation of the price of any security of
the Company to facilitate the sale or resale of any of the Securities, (ii) sold, bid for, purchased, or, paid any compensation
for soliciting purchases of, any of the Securities, or (iii) paid or agreed to pay to any Person any compensation for soliciting
another to purchase any other securities of the Company.


 


(bb)
Shell Company Status. The Company is not currently an issuer identified in Rule 144(i)(1)(i) under the Securities Act,
is subject to the reporting requirements of section 13 or 15(d) of the Exchange Act, has filed all reports and other materials
required to be filed by section 13 or 15(d) of the Exchange Act, as applicable, during the preceding 12 months, and, as of a date
at least one year prior to the Effective Date, has filed current “Form 10 information” with the Commission (as defined
in Rule 144(i)(3) of the Securities Act) reflecting its status as an entity that is no longer an issuer described in paragraph
Rule 144(i)(1)(i) of the Securities Act.


 


(cc)
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 contemplated hereby, any beneficial owner of 20% or more of
the Company’s outstanding voting equity securities, calculated on the basis of voting power, nor any promoter (as that term
is defined in Rule 405 under the Securities Act) connected with the Company in any capacity at the time of sale (each, an “Issuer
Covered Person”) is subject to any of the “Bad Actor” disqualifications described in Rule 506(d)(1)(i) to
(viii) under the Securities Act (a “Disqualification Event”), except for a Disqualification Event covered by
Rule 506(d)(2) or (d)(3) under the Securities Act. The Company has exercised reasonable care to determine whether any Issuer Covered
Person is subject to a Disqualification Event.


 


5.
COVENANTS.


 


(a)
Filing of Current Report and Registration Statement. The Company agrees that it shall, within the time required under the
Exchange Act, file with the SEC a report on Form 8-K relating to the transactions contemplated by, and describing the material
terms and conditions of, the Transaction Documents (the “Current Report”). The Company shall also file with
the SEC, within twenty (20) days of the Effective Date, a new registration statement (the “Registration Statement”)
covering only the resale of the Purchase Shares and the Commitment Shares in accordance with the terms of the Registration Rights
Agreement between the Company and the Investor, dated as of the date hereof (the “Registration Rights Agreement”).
The Company shall permit the Investor to review and comment upon the final pre-filing draft version of the Current Report at least
two (2) Business Days prior to its filing with the SEC, and the Company shall give due consideration to all such comments. The
Investor shall use its reasonable best efforts to comment upon the final pre-filing draft version of the Current Report within
one (1) Business Day from the date the Investor receives it from the Company.


 


(b)
Blue Sky. The Company shall take all such action, if any, as is reasonably necessary in order to obtain an exemption for
or to register or qualify (i) the issuance of the Commitment Shares and the sale of the Purchase Shares to the Investor under
this Agreement and (ii) any subsequent resale of all Commitment Shares and all Purchase Shares by the Investor, in each case,
under applicable securities or “Blue Sky” laws of the states of the United States in such states as is reasonably
requested by the Investor from time to time, and shall provide evidence of any such action so taken to the Investor.


 




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(c)
Listing/DTC. The Company shall promptly secure the listing of all of the Purchase Shares and Commitment Shares to be issued
to the Investor hereunder on the Principal Market (subject to official notice of issuance) and upon each other national securities
exchange or automated quotation system, if any, upon which the Common Stock is then listed, and shall maintain, so long as any
shares of Common Stock shall be so listed, such listing of all such Securities from time to time issuable hereunder. The Company
shall maintain the listing of the Common Stock on the Principal Market and shall comply in all respects with the Company’s
reporting, filing and other obligations under the bylaws or rules and regulations of the Principal Market. Neither the Company
nor any of its Subsidiaries shall take any action that would reasonably be expected to result in the delisting or suspension of
the Common Stock on the Principal Market. The Company shall promptly, and in no event later than the following Business Day, provide
to the Investor copies of any notices it receives from any Person regarding the continued eligibility of the Common Stock for
listing on the Principal Market. The Company shall pay all fees and expenses in connection with satisfying its obligations under
this Section 5(c). The Company shall take all action necessary to ensure that its Common Stock can be transferred
electronically as DWAC Shares.


 


(d)
Prohibition of Short Sales and Hedging Transactions. The Investor agrees that beginning on the date of this Agreement and
ending on the date of termination of this Agreement as provided in Section 11, the Investor and its agents, representatives
and affiliates shall not in any manner whatsoever enter into or effect, directly or indirectly, any (i) “short sale”
(as such term is defined in Rule 200 of Regulation SHO of the Exchange Act) of the Common Stock or (ii) hedging transaction, which
establishes a net short position with respect to the Common Stock.


 


(e)
Issuance of Commitment Shares. In consideration for the Investor’s execution and delivery of this Agreement, the
Company shall cause the Transfer Agent to issue on the date of this Agreement 416,666 shares of Common Stock (the “Commitment
Shares”) directly to the Investor and shall deliver to the Transfer Agent the Irrevocable Transfer Agent Instructions
in the form as set forth in Exhibit E attached hereto. For the avoidance of doubt, all of the Commitment Shares shall be
fully earned as of the date of this Agreement, whether or not the Commencement shall occur or any Purchase Shares are purchased
by the Investor under this Agreement and irrespective of any termination of this Agreement.


 


(f)
Due Diligence; Non-Public Information. The Investor shall have the right, from time to time as the Investor may reasonably
deem appropriate, to perform reasonable due diligence on the Company during normal business hours. The Company and its officers
and employees shall provide information and reasonably cooperate with the Investor in connection with any reasonable request by
the Investor related to the Investor’s due diligence of the Company. Each party hereto agrees not to disclose any Confidential
Information of the other party to any third party and shall not use the Confidential Information for any purpose other than in
connection with, or in furtherance of, the transactions contemplated hereby. Each party hereto acknowledges that the Confidential
Information shall remain the property of the disclosing party and agrees that it shall take all reasonable measures to protect
the secrecy of any Confidential Information disclosed by the other party. The Company confirms that neither it nor any other Person
acting on its behalf shall provide the Investor or its agents or counsel with any information that constitutes or might constitute
material, non-public information, unless a simultaneous public announcement thereof is made by the Company in the manner contemplated
by Regulation FD. In the event of a breach of the foregoing covenant by the Company or any Person acting on its behalf (as determined
in the reasonable good faith judgment of the Investor), in addition to any other remedy provided herein or in the other Transaction
Documents, the Investor shall have the right to make a public disclosure, in the form of a press release, public advertisement
or otherwise, of such material, non-public information without the prior approval by the Company; provided the Investor shall
have first provided notice to the Company that it believes it has received information that constitutes material, non-public information,
the Company shall have at least twenty-four (24) hours to publicly disclose such material, non-public information prior to any
such disclosure by the Investor, and the Company shall have failed to publicly disclose such material, non-public information
within such time period. The Investor shall not have any liability to the Company, any of its Subsidiaries, or any of their respective
directors, officers, employees, stockholders or agents, for any such disclosure. The Company understands and confirms that the
Investor shall be relying on the foregoing covenants in effecting transactions in securities of the Company.


 




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(g)
Purchase Records. The Investor and the Company shall each maintain records showing the remaining Available Amount at any
given time and the dates and Purchase Amounts for each Regular Purchase, Additional Purchase and Accelerated Purchase or shall
use such other method, reasonably satisfactory to the Investor and the Company.


 


(h)
Taxes. The Company shall pay any and all transfer, stamp or similar taxes that may be payable with respect to the issuance
and delivery of any shares of Common Stock to the Investor made under this Agreement.


 


(i)
Use of Proceeds. The Company will use the net proceeds from the offering as described in the Registration Statement or
the SEC Documents.


 


(j)
Other Transactions. The Company shall not enter into, announce or recommend to its stockholders any agreement, plan, arrangement
or transaction in or of which the terms thereof would restrict, materially delay, conflict with or impair the ability or right
of the Company to perform its obligations under the Transaction Documents, including, without limitation, the obligation of the
Company to deliver the Purchase Shares and the Commitment Shares to the Investor in accordance with the terms of the Transaction
Documents.


 


(k)
Integration. From and after the date of this Agreement, neither the Company, nor or any of its affiliates will, and the
Company shall use its reasonable best efforts to ensure that no Person acting on their behalf will, directly or indirectly, make
any offers or sales of any security or solicit any offers to buy any security, under circumstances that would require registration
of the offer and sale of any of the Securities under the Securities Act.


 


(l)
Limitation on Variable Rate Transactions. From and after the date of this Agreement until the 36-month anniversary of the
date of this Agreement (irrespective of any earlier termination of this Agreement), the Company shall be prohibited from effecting
or entering into an agreement to effect any issuance by the Company or any of its Subsidiaries of Common Stock or Common Stock
Equivalents (or a combination of units thereof) involving a Variable Rate Transaction, other than in connection with an Exempt
Issuance. “Common Stock Equivalents” means any securities of the Company or its Subsidiaries which entitle
the holder thereof to acquire at any time Common Stock, including, without limitation, any debt, preferred stock, rights, options,
warrants or other instrument that is at any time convertible into or exercisable or exchangeable for, or otherwise entitles the
holder thereof to receive, Common Stock. “Variable Rate Transaction” means a transaction in which the Company
(i) issues or sells any debt or equity securities that are convertible into, exchangeable or exercisable for, or include the right
to receive additional shares of Common Stock or Common Stock Equivalents either (A) at a conversion price, exercise price or exchange
rate or other price that is based upon and/or varies with the trading prices of or quotations for the Common Stock at any time
after the initial issuance of such debt or equity securities, or (B) with a conversion, exercise or exchange price that is subject
to being reset at some future date after the initial issuance of such debt or equity security or upon the occurrence of specified
or contingent events directly or indirectly related to the business of the Company or the market for the Common Stock (including,
without limitation, any “full ratchet” or “weighted average” anti-dilution provisions) or (ii) enters
into any agreement, including, but not limited to, an “equity line of credit”, “at-the-market offering”
or other continuous offering or similar offering of Common Stock or Common Stock Equivalents, whereby the Company may sell Common
Stock or Common Stock Equivalents at a future determined price. “Exempt Issuance” means the issuance of (a)
Common Stock or options to employees, officers, directors or vendors of the Company pursuant to any stock or option plan duly
adopted for such purpose, by the Board of Directors or a majority of the members of a committee of directors established for such
purpose, (b) securities upon the exercise or exchange of or conversion of any Securities issued hereunder and/or other securities
exercisable or exchangeable for or convertible into Common Stock issued and outstanding on the date of this Agreement, provided
that such securities have not been amended since the date of this Agreement to increase the number of such securities or to decrease
the exercise price, exchange price or conversion price of such securities, and (c) securities issued pursuant to acquisitions
or strategic transactions approved by the Board of Directors or a majority of the members of a committee of directors established
for such purpose, which acquisitions or strategic transactions can have a Variable Rate Transaction component, provided that any
such issuance shall only be to a Person (or to the equity holders of a Person) which is, itself or through its subsidiaries, an
operating company or an asset in a business synergistic with the business of the Company and shall provide to the Company additional
benefits in addition to the investment of funds, but shall not include a transaction in which the Company is issuing securities
primarily for the purpose of raising capital or to an entity whose primary business is investing in securities.


 




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6.
TRANSFER AGENT INSTRUCTIONS.


 


(a)
On the date of this Agreement, the Company shall issue irrevocable instructions to the Transfer Agent substantially in the form
attached hereto as Exhibit E to issue the Commitment Shares in accordance with the terms of this Agreement (the “Irrevocable
Transfer Agent Instructions”). The certificate(s) representing the Commitment Shares, except as set forth below, shall
bear the following restrictive legend (the “Restrictive Legend”):


 


THE
SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE
STATE SECURITIES LAWS. THE SECURITIES HAVE BEEN ACQUIRED FOR INVESTMENT AND MAY NOT BE OFFERED FOR SALE, SOLD, TRANSFERRED OR
ASSIGNED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT FOR THE SECURITIES UNDER THE SECURITIES ACT OF 1933, AS AMENDED,
OR APPLICABLE STATE SECURITIES LAWS, UNLESS SOLD PURSUANT TO: (1) RULE 144 UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR (2)
AN OPINION OF HOLDER’S COUNSEL, IN A CUSTOMARY FORM, THAT REGISTRATION IS NOT REQUIRED UNDER SAID ACT OR APPLICABLE STATE
SECURITIES LAWS.


 


(b)
On the earlier of (i) the Commencement Date and (ii) such time that the Investor shall request, provided all conditions of Rule
144 under the Securities Act are met, the Company shall, no later than one (1) Business Day following the delivery by the Investor
to the Company or the Transfer Agent of one or more legended certificates representing the Commitment Shares (which certificates
the Investor shall promptly deliver on or prior to the first to occur of the events described in clauses (i) and (ii) of this
sentence), as directed by the Investor, issue and deliver (or cause to be issued and delivered) to the Investor, as requested
by the Investor, either: (A) a certificate representing such Commitment Shares that is free from all restrictive and other legends
or (B) a number of shares of Common Stock equal to the number of Commitment Shares represented by the certificate(s) so delivered
by the Investor as DWAC Shares. The Company shall take all actions to carry out the intent and accomplish the purposes of the
immediately preceding sentence, including, without limitation, delivering all such legal opinions, consents, certificates, resolutions
and instructions to the Transfer Agent, and any successor transfer agent of the Company, as may be requested from time to time
by the Investor or necessary or desirable to carry out the intent and accomplish the purposes of the immediately preceding sentence.
On the Commencement Date, the Company shall issue to the Transfer Agent, and any subsequent transfer agent, (i) irrevocable instructions
in the form substantially similar to those used by the Investor in substantially similar transactions (the “Commencement
Irrevocable Transfer Agent Instructions”) and (ii) the notice of effectiveness of the Registration Statement in the
form attached as an exhibit to the Registration Rights Agreement (the “Notice of Effectiveness of Registration Statement”),
in each case to issue the Commitment Shares and the Purchase Shares in accordance with the terms of this Agreement and the Registration
Rights Agreement. All Purchase Shares to be issued from and after Commencement to or for the benefit of the Investor pursuant
to this Agreement shall be issued only as DWAC Shares. The Company represents and warrants to the Investor that, while this Agreement
is effective, no instruction other than the Commencement Irrevocable Transfer Agent Instructions and the Notice of Effectiveness
of Registration Statement referred to in this Section 6(b) will be given by the Company to the Transfer Agent with
respect to the Commitment Shares or the Purchase Shares from and after Commencement, and the Commitment Shares and the Purchase
Shares covered by the Registration Statement shall otherwise be freely transferable on the books and records of the Company. The
Company agrees that if the Company fails to fully comply with the provisions of this Section 6(b) within five (5)
Business Days of the Investor providing the deliveries referred to above, the Company shall, at the Investor’s written instruction,
purchase such shares of Common Stock containing the Restrictive Legend from the Investor at the greater of the (i) Purchase Price
or Accelerated Purchase Price paid for such shares of Common Stock (as applicable) and (ii) the Closing Sale Price of the Common
Stock on the date of the Investor’s written instruction.


 




    	18



    	 



    

 


7.
CONDITIONS TO THE COMPANY’S RIGHT TO COMMENCE SALES OF PURCHASE
SHARES.


 


The
right of the Company hereunder to commence sales of the Purchase Shares on the Commencement Date is subject to the satisfaction
of each of the following conditions:


 


(a)
The Investor shall have executed each of the Transaction Documents and delivered the same to the Company;


 


(b)
The Registration Statement covering the resale of the Commitment Shares and Purchase Shares shall have been declared effective
under the Securities Act by the SEC and no stop order with respect to the Registration Statement shall be pending or threatened
by the SEC; and


 


(c)
The representations and warranties of the Investor shall be true and correct in all material respects as of the date hereof and
as of the Commencement Date as though made at that time.


 


8.
CONDITIONS TO THE INVESTOR’S OBLIGATION TO PURCHASE SHARES OF COMMON STOCK.


 


The
obligation of the Investor to buy Purchase Shares under this Agreement is subject to the satisfaction of each of the following
conditions on or prior to the Commencement Date and, once such conditions have been initially satisfied, there shall not be any
ongoing obligation to satisfy such conditions after the Commencement has occurred:


 


(a)
The Company shall have executed each of the Transaction Documents and delivered the same to the Investor;


 


(b)
The Company shall have issued or caused to be issued to the Investor (i) one or more certificates representing the Commitment
Shares free from all restrictive and other legends or (ii) a number of shares of Common Stock equal to the number of Commitment
Shares as DWAC Shares, in each case in accordance with Section 6(b);


 




    	19



    	 



    

 


(c)
The Common Stock shall be listed or quoted on the Principal Market (other than the OTCPink), trading in the Common Stock shall
not have been within the last 365 days suspended by the SEC or the Principal Market, and all Securities to be issued by the Company
to the Investor pursuant to this Agreement shall have been approved for listing or quotation on the Principal Market in accordance
with the applicable rules and regulations of the Principal Market, subject only to official notice of issuance;


 


(d)
The Investor shall have received the opinions of the Company’s legal counsel dated as of the Commencement Date substantially
in the form of Exhibit A attached hereto;


 


(e)
The representations and warranties of the Company shall be true and correct in all material respects (except to the extent that
any of such representations and warranties is already qualified as to materiality in Section 4 above, in which case, such representations
and warranties shall be true and correct without further qualification) as of the date hereof and as of the Commencement Date
as though made at that time (except for representations and warranties that speak as of a specific date, which shall be true and
correct as of such date) and the Company shall have performed, satisfied and complied with the covenants, agreements and conditions
required by the Transaction Documents to be performed, satisfied or complied with by the Company at or prior to the Commencement
Date. The Investor shall have received a certificate, executed by the CEO, President or CFO of the Company, dated as of the Commencement
Date, to the foregoing effect in the form attached hereto as Exhibit B;


 


(f)
The Board of Directors of the Company shall have adopted resolutions in the form attached hereto as Exhibit C which
shall be in full force and effect without any amendment or supplement thereto as of the Commencement Date;


 


(g)
As of the Commencement Date, the Company shall have reserved out of its authorized and unissued Common Stock, solely for the purpose
of effecting purchases of Purchase Shares hereunder, 12,000,000 shares of Common Stock.


 


(h)
The Commencement Irrevocable Transfer Agent Instructions and the Notice of Effectiveness of Registration Statement each shall
have been delivered to and acknowledged in writing by the Company and the Company’s Transfer Agent (or any successor transfer
agent);


 


(i)
The Company shall have delivered to the Investor a certificate evidencing the incorporation and good standing of the Company in
the State of Delaware issued by the Secretary of State of the State of Delaware as of a date within ten (10) Business Days of
the Commencement Date;


 


(j)
The Company shall have delivered to the Investor a certified copy of the Certificate of Incorporation as certified by the Secretary
of State of the State of Delaware within ten (10) Business Days of the Commencement Date;


 


(k)
The Company shall have delivered to the Investor a secretary’s certificate executed by the Secretary of the Company, dated
as of the Commencement Date, in the form attached hereto as Exhibit D;


 


(l)
The Registration Statement covering the resale of the Commitment Shares and Purchase Shares shall have been declared effective
under the Securities Act by the SEC and no stop order with respect to the Registration Statement shall be pending or threatened
by the SEC. The Company shall have prepared and filed with the SEC, not later than one (1) Business Day after the effective date
of the Registration Statement, a final and complete prospectus (the preliminary form of which shall be included in the Registration
Statement) and shall have delivered to the Investor a true and complete copy thereof. Such prospectus shall be current and available
for the resale by the Investor of all of the Securities covered thereby. The Current Report shall have been filed with the SEC,
as required pursuant to Section 5(a). All reports, schedules, registrations, forms, statements, information and
other documents required to have been filed by the Company with the SEC at or prior to the Commencement Date pursuant to the reporting
requirements of the Exchange Act shall have been filed with the SEC within the applicable time periods prescribed for such filings
under the Exchange Act;


 




    	20



    	 



    

 


(m)
No Event of Default has occurred, or any event which, after notice and/or lapse of time, would become an Event of Default has
occurred;


 


(n)
All federal, state and local governmental laws, rules and regulations applicable to the transactions contemplated by the Transaction
Documents and necessary for the execution, delivery and performance of the Transaction Documents and the consummation of the transactions
contemplated thereby in accordance with the terms thereof shall have been complied with, and all consents, authorizations and
orders of, and all filings and registrations with, all federal, state and local courts or governmental agencies and all federal,
state and local regulatory or self-regulatory agencies necessary for the execution, delivery and performance of the Transaction
Documents and the consummation of the transactions contemplated thereby in accordance with the terms thereof shall have been obtained
or made, including, without limitation, in each case those required under the Securities Act, the Exchange Act, applicable state
securities or “Blue Sky” laws or applicable rules and regulations of the Principal Market, or otherwise required by
the SEC, the Principal Market or any state securities regulators;


 


(o)
No statute, regulation, order, decree, writ, ruling or injunction shall have been enacted, entered, promulgated, threatened or
endorsed by any federal, state, local or foreign court or governmental authority of competent jurisdiction which prohibits the
consummation of or which would materially modify or delay any of the transactions contemplated by the Transaction Documents; and


 


(p)
No action, suit or proceeding before any federal, state, local or foreign arbitrator or any court or governmental authority of
competent jurisdiction shall have been commenced or threatened, and no inquiry or investigation by any federal, state, local or
foreign governmental authority of competent jurisdiction shall have been commenced or threatened, against the Company, or any
of the officers, directors or affiliates of the Company, seeking to restrain, prevent or change the transactions contemplated
by the Transaction Documents, or seeking material damages in connection with such transactions.


 


9.
INDEMNIFICATION.


 


In
consideration of the Investor’s execution and delivery of the Transaction Documents and acquiring the Securities hereunder
and in addition to all of the Company’s other obligations under the Transaction Documents, the Company shall defend, protect,
indemnify and hold harmless the Investor and all of its affiliates, stockholders, officers, directors, employees and direct or
indirect investors and any of the foregoing Person’s 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 the Transaction Documents or any other certificate, instrument or document contemplated hereby
or thereby, (b) any breach of any covenant, agreement or obligation of the Company contained in the Transaction Documents or any
other certificate, instrument or document contemplated hereby or thereby, or (c) any cause of action, suit or claim brought or
made against such Indemnitee and arising out of or resulting from the execution, delivery, performance or enforcement of the Transaction
Documents or any other certificate, instrument or document contemplated hereby or thereby, other than, in the case of clause (c),
with respect to Indemnified Liabilities which directly and primarily result from the fraud, gross negligence or willful misconduct
of an Indemnitee. The indemnity in this Section 9 shall not apply to amounts paid in settlement of any claim if such settlement
is effected without the prior written consent of the Company, which consent shall not be unreasonably withheld, conditioned or
delayed. 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 which is permissible under applicable
law. Payment under this indemnification shall be made within thirty (30) days from the date Investor makes written request for
it. A certificate containing reasonable detail as to the amount of such indemnification submitted to the Company by Investor shall
be conclusive evidence, absent manifest error, of the amount due from the Company to Investor. If any action shall be brought
against any Indemnitee in respect of which indemnity may be sought pursuant to this Agreement, such Indemnitee shall promptly
notify the Company in writing, and the Company shall have the right to assume the defense thereof with counsel of its own choosing
reasonably acceptable to the Indemnitee. Any Indemnitee shall have the right to employ separate counsel in any such action and
participate in the defense thereof, but the fees and expenses of such counsel shall be at the expense of such Indemnitee, except
to the extent that (i) the employment thereof has been specifically authorized by the Company in writing, (ii) the Company has
failed after a reasonable period of time to assume such defense and to employ counsel or (iii) in such action there is, in the
reasonable opinion of such separate counsel, a material conflict on any material issue between the position of the Company and
the position of such Indemnitee, in which case the Company shall be responsible for the reasonable fees and expenses of no more
than one such separate counsel.


 




    	21



    	 



    

 


10.
EVENTS OF DEFAULT.


 


An
“Event of Default” shall be deemed to have occurred at any time as any of the following events occurs:


 


(a)
the effectiveness of a registration statement registering the resale of the Securities lapses for any reason (including, without
limitation, the issuance of a stop order or similar order) or such registration statement (or the prospectus forming a part thereof)
is unavailable to the Investor for resale of any or all of the Securities to be issued to the Investor under the Transaction Documents,
and such lapse or unavailability continues for a period of ten (10) consecutive Business Days or for more than an aggregate of
thirty (30) Business Days in any 365-day period, but excluding a lapse or unavailability where (i) the Company terminates a registration
statement after the Investor has confirmed in writing that all of the Securities covered thereby have been resold or (ii) the
Company supersedes one registration statement with another registration statement, including (without limitation) by terminating
a prior registration statement when it is effectively replaced with a new registration statement covering Securities (provided
in the case of this clause (ii) that all of the Securities covered by the superseded (or terminated) registration statement that
have not theretofore been resold are included in the superseding (or new) registration statement);


 


(b)
the suspension of the Common Stock from trading on the Principal Market for a period of three (3) consecutive Business Days, provided
that the Company may not direct the Investor to purchase any shares of Common Stock during any such suspension;


 


(c)
the delisting of the Common Stock from the OTCBB, provided, however, that the Common Stock is not immediately thereafter trading
on the New York Stock Exchange, The NASDAQ Capital Market, The NASDAQ Global Market, The NASDAQ Global Select Market, the NYSE
MKT, the OTCQB or the OTCQX operated by the OTC Markets Group, Inc. (or nationally recognized successor to any of the foregoing);


 




    	22



    	 



    

 


(d)
the failure for any reason by the Transfer Agent to issue Purchase Shares to the Investor within three (3) Business Days after
the applicable Purchase Date or Accelerated Purchase Date (as applicable) on which the Investor is entitled to receive such Purchase
Shares;


 


(e)
the Company breaches any representation, warranty, covenant or other term or condition under any Transaction Document if such
breach could have a Material Adverse Effect and except, in the case of a breach of a covenant which is reasonably curable, only
if such breach continues for a period of at least five (5) Business Days;


 


(f)
if any Person commences a proceeding against the Company pursuant to or within the meaning of any Bankruptcy Law;


 


(g)
if the Company, pursuant to or within the meaning of any Bankruptcy Law, (i) commences a voluntary case, (ii) consents to the
entry of an order for relief against it in an involuntary case, (iii) consents to the appointment of a Custodian of it or for
all or substantially all of its property, or (iv) makes a general assignment for the benefit of its creditors;


 


(h)
a court of competent jurisdiction enters an order or decree under any Bankruptcy Law that (i) is for relief against the Company
in an involuntary case, (ii) appoints a Custodian of the Company or for all or substantially all of its property, or (iii) orders
the liquidation of the Company or any Subsidiary; or


 


(i)
if at any time the Company is not eligible to transfer its Common Stock electronically as DWAC Shares.


 


In
addition to any other rights and remedies under applicable law and this Agreement, so long as an Event of Default has occurred
and is continuing, or if any event which, after notice and/or lapse of time, would become an Event of Default, has occurred and
is continuing, the Company shall not deliver to the Investor any Regular Purchase Notice, Additional Purchase Notice or Accelerated
Purchase Notice.


 


11.
TERMINATION


 


This
Agreement may be terminated only as follows:


 


(a)
If pursuant to or within the meaning of any Bankruptcy Law, the Company commences a voluntary case or any Person commences a proceeding
against the Company, a Custodian is appointed for the Company or for all or substantially all of its property, or the Company
makes a general assignment for the benefit of its creditors (any of which would be an Event of Default as described in Sections
10(f), 10(g) and 10(h) hereof), this Agreement shall automatically terminate without any liability or payment
to the Company (except as set forth below) without further action or notice by any Person.


 


(b)
In the event that the Commencement shall not have occurred on or before December 31, 2015, due to the failure to satisfy the conditions
set forth in Sections 7 and 8 above with respect to the Commencement, either the Company or the Investor shall have
the option to terminate this Agreement at the close of business on such date or thereafter without liability of any party to any
other party (except as set forth below); provided, however, that the right to terminate this Agreement under this Section 11(b)
shall not be available to any party if such party is then in breach of any covenant or agreement contained in this Agreement
or any representation or warranty of such party contained in this Agreement fails to be true and correct such that the conditions
set forth in Section 7(c) or Section 8(e), as applicable, could not then be satisfied.


 




    	23



    	 



    

 


(c)
At any time after the Commencement Date, the Company shall have the option to terminate this Agreement for any reason or for no
reason by delivering notice (a “Company Termination Notice”) to the Investor electing to terminate this Agreement
without any liability whatsoever of any party to any other party under this Agreement (except as set forth below). The Company
Termination Notice shall not be effective until one (1) Business Day after it has been received by the Investor.


 


(d)
This Agreement shall automatically terminate on the date that the Company sells and the Investor purchases the full Available
Amount as provided herein, without any action or notice on the part of any party and without any liability whatsoever of any party
to any other party under this Agreement (except as set forth below).


 


(e)
If, for any reason or for no reason, the full Available Amount has not been purchased in accordance with Section 2 of this
Agreement by the Maturity Date, this Agreement shall automatically terminate on the Maturity Date, without any action or notice
on the part of any party and without any liability whatsoever of any party to any other party under this Agreement (except as
set forth below).


 


Except
as set forth in Sections 11(a) (in respect of an Event of Default under Sections 10(f), 10(g)
and 10(h)), 11(d) and 11(e), any termination of this Agreement pursuant to this Section
11 shall be effected by written notice from the Company to the Investor, or the Investor to the Company, as the case may be,
setting forth the basis for the termination hereof. The representations and warranties and covenants of the Company and the Investor
contained in Sections 3, 4, 5, and 6 hereof, the indemnification provisions set forth in Section
9 hereof and the agreements and covenants set forth in Sections 10, 11 and 12 shall survive the
Commencement and any termination of this Agreement. No termination of this Agreement shall (i) affect the Company’s or the
Investor’s rights or obligations under (A) this Agreement with respect to pending Regular Purchases, Additional Purchases
and Accelerated Purchases and the Company and the Investor shall complete their respective obligations with respect to any pending
Regular Purchases, Additional Purchases and Accelerated Purchases under this Agreement and (B) the Registration Rights Agreement,
which shall survive any such termination, or (ii) be deemed to release the Company or the Investor from any liability for intentional
misrepresentation or willful breach of any of the Transaction Documents.


 


12.
MISCELLANEOUS.


 


(a)
Governing Law; Jurisdiction; Jury Trial. The corporate laws of the State of Delaware shall govern all issues concerning
the relative rights of the Company and its stockholders. All other questions concerning the construction, validity, enforcement
and interpretation of this Agreement and the other Transaction Documents shall be governed by the internal laws of the State of
Illinois, without giving effect to any choice of law or conflict of law provision or rule (whether of the State of Illinois or
any other jurisdictions) that would cause the application of the laws of any jurisdictions other than the State of Illinois. Each
party hereby irrevocably submits to the exclusive jurisdiction of the state and federal courts sitting in the State of Illinois,
County of Cook, for the adjudication of any dispute hereunder or under the other Transaction Documents or in connection herewith
or therewith, or with any transaction contemplated hereby or discussed herein, and hereby irrevocably waives, and agrees not to
assert in any suit, action or proceeding, any claim that it is not personally subject to the jurisdiction of any such court, that
such suit, action or proceeding is brought in an inconvenient forum or that the venue of such suit, action or proceeding is improper.
Each party hereby irrevocably waives personal service of process and consents to process being served in any such suit, action
or proceeding by mailing a copy thereof to such party at the address for such 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 manner permitted by law. 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
HEREWITH OR ARISING OUT OF THIS AGREEMENT OR ANY TRANSACTION CONTEMPLATED HEREBY.


 




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(b)
Counterparts. This Agreement may be executed in identical counterparts, both of which shall be considered one and the same
agreement and shall become effective when counterparts have been signed by each party and delivered to the other party; provided
that a facsimile signature or signature delivered by e-mail in a “.pdf” format data file 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 signature.


 


(c)
Headings. The headings of this Agreement are for convenience of reference and shall not form part of, or affect the interpretation
of, this Agreement.


 


(d)
Severability. If any provision of this Agreement shall be invalid or unenforceable in any jurisdiction, such invalidity
or unenforceability shall not affect the validity or enforceability of the remainder of this Agreement in that jurisdiction or
the validity or enforceability of any provision of this Agreement in any other jurisdiction.


 


(e)
Entire Agreement. The Transaction Documents supersede all other prior oral or written agreements between the Investor,
the Company, their affiliates and Persons acting on their behalf with respect to the subject matter thereof, and this Agreement,
the other Transaction Documents 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
Investor makes any representation, warranty, covenant or undertaking with respect to such matters. The Company acknowledges and
agrees that is has not relied on, in any manner whatsoever, any representations or statements, written or oral, other than as
expressly set forth in the Transaction Documents.


 


(f)
Notices. Any notices, consents or other communications required or permitted to be given under the terms of this Agreement
must be in writing and will be deemed to have been delivered: (i) upon receipt when delivered personally; (ii) upon receipt when
sent by facsimile or email (provided confirmation of transmission is mechanically or electronically generated and kept on file
by the sending party); or (iii) one Business Day after deposit with a nationally recognized overnight delivery service, in each
case properly addressed to the party to receive the same. The addresses for such communications shall be:


 


	 	If
    to the Company:
	 	 	 
	 	 	Cachet
    Financial Solutions, Inc.

    18671 Lake Drive East

    Southwest Tech Center A

    Minneapolis, MN 55317

    Telephone: 952.698.6980

    Facsimile: 952.698.6999

    E-mail: jmack@cachetfinancial.com

    Attention: Jeffrey C. Mack, Chief Executive Officer


 




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	 	 	With
    a copy to (which shall not constitute notice or service of process):
	 	 	 
	 	 	Briggs and Morgan,
    P.A. 

    80 South 8th Street 

    Minneapolis, MN 55402 

    Telephone: 612.977.8400

    Facsimile: 612.977.8650

    E-mail: skozachok@briggs.com 

    Attention: Steve Kozachok
	 	 
	 	If
    to the Investor:
	 	 	 
	 	 	Lincoln Park Capital
    Fund, LLC

    440 North Wells, Suite 410

    Chicago, IL 60654

    Telephone: 312.822.9300

    Facsimile: 312.822.9301

    E-mail: jscheinfeld@lpcfunds.com/jcope@lpcfunds.com

    Attention: Josh Scheinfeld/Jonathan Cope
	 	 	 
	 	 	With
    a copy to (which shall not constitute notice or service of process):
	 	 	 
	 	 	K&L Gates,
    LLP

    200 S. Biscayne Blvd., Ste. 3900

    Miami, Florida 33131

    Telephone: 305.539.3306

    Facsimile: 305.358.7095

    E-mail: clayton.parker@klgates.com

    Attention: Clayton E. Parker, Esq.
	 	 
	 	If
    to the Transfer Agent:
	 	 	 
	 	 	Corporate
    Stock Transfer, Inc.

    3200 Cherry Creek Drive S.

    Denver, Colorado 80209

    Telephone: 303.282.4800

    Facsimile: 303.282.5800

    E-mail: cbell@corporatestock.com

    Attention: Carolyn Bell


 


or
at such other address and/or facsimile number and/or to the attention of such other Person as the recipient party has specified
by written notice given to each other party three (3) Business Days prior to the effectiveness of such change. Written confirmation
of receipt (A) given by the recipient of such notice, consent or other communication, (B) mechanically or electronically generated
by the sender’s facsimile machine or email account containing the time, date, and recipient facsimile number or email address,
as applicable, and an image of the first page of such transmission or (C) provided by a nationally recognized overnight delivery
service, shall be rebuttable evidence of personal service, receipt by facsimile or receipt from a nationally recognized overnight
delivery service in accordance with clause (i), (ii) or (iii) above, respectively.


 




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(g)
Successors and Assigns. This Agreement shall be binding upon and inure to the benefit of the parties and their respective
successors and assigns. The Company shall not assign this Agreement or any rights or obligations hereunder without the prior written
consent of the Investor, including by merger or consolidation. The Investor may not assign its rights or obligations under this
Agreement.


 


(h)
No 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)
Publicity. The Company shall afford the Investor and its counsel with the opportunity to review and comment upon, shall
consult with the Investor and its counsel on the form and substance of, and shall give due consideration to all such comments
from the Investor or its counsel on, any press release, SEC filing or any other public disclosure by or on behalf of the Company
relating to the Investor, its purchases hereunder or any aspect of the Transaction Documents or the transactions contemplated
thereby, not less than 24 hours prior to the issuance, filing or public disclosure thereof. The Investor must be provided with
a final version of any such press release, SEC filing or other public disclosure at least 24 hours prior to any release, filing
or use by the Company thereof. The Company agrees and acknowledges that its failure to fully comply with this provision constitutes
a Material Adverse Effect.


 


(j)
Further Assurances. 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 consummate and make effective, as soon as reasonably possible, the Commencement, and to carry out the intent
and accomplish the purposes of this Agreement and the consummation of the transactions contemplated hereby.


 


(k)
No Financial Advisor, Placement Agent, Broker or Finder. The Company represents and warrants to the Investor that it has
not engaged any financial advisor, placement agent, broker or finder in connection with the transactions contemplated hereby.
The Investor represents and warrants to the Company that it has not engaged any financial advisor, placement agent, broker or
finder in connection with the transactions contemplated hereby. The Company shall be responsible for the payment of any fees or
commissions, if any, of any financial advisor, placement agent, broker or finder relating to or arising out of the transactions
contemplated hereby. The Company shall pay, and hold the Investor harmless against, any liability, loss or expense (including,
without limitation, attorneys’ fees and out of pocket expenses) arising in connection with any such claim.


 


(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)
Remedies, Other Obligations, Breaches and Injunctive Relief. The Investor’s remedies provided in this Agreement,
including, without limitation, the Investor’s remedies provided in Section 9, shall be cumulative and in addition to all
other remedies available to the Investor under this Agreement, at law or in equity (including a decree of specific performance
and/or other injunctive relief), no remedy of the Investor contained herein shall be deemed a waiver of compliance with the provisions
giving rise to such remedy and nothing herein shall limit the Investor’s right to pursue actual damages for any failure
by the Company to comply with the terms of this Agreement. The Company acknowledges that a breach by it of its obligations hereunder
will cause irreparable harm to the Investor and that the remedy at law for any such breach may be inadequate. The Company therefore
agrees that, in the event of any such breach or threatened breach, the Investor shall be entitled, in addition to all other available
remedies, to an injunction restraining any breach, without the necessity of showing economic loss and without any bond or other
security being required.


 




    	27



    	 



    

 


(n)
Enforcement Costs. If: (i) this Agreement is placed by the Investor in the hands of an attorney for enforcement or is enforced
by the Investor through any legal proceeding; (ii) an attorney is retained to represent the Investor in any bankruptcy, reorganization,
receivership or other proceedings affecting creditors’ rights and involving a claim under this Agreement; or (iii) an attorney
is retained to represent the Investor in any other proceedings whatsoever in connection with this Agreement, then the Company
shall pay to the Investor, as incurred by the Investor, all reasonable costs and expenses including attorneys’ fees incurred
in connection therewith, in addition to all other amounts due hereunder.


 


(o)
Amendment and Waiver; Failure or Indulgence Not Waiver. No provision of this Agreement may be amended or waived by the
parties from and after the date that is one (1) Business Day immediately preceding the filing of the Registration Statement with
the SEC. Subject to the immediately preceding sentence, (i) no provision of this Agreement may be amended other than by a written
instrument signed by both parties hereto and (ii) no provision of this Agreement may be waived other than in a written instrument
signed by the party against whom enforcement of such waiver is sought. No failure or delay in the exercise of any power, right
or privilege hereunder 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 privilege.


 


**
Signature Page Follows **


 




    	28



    	 



    

 


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


 


	 	THE
    COMPANY:
	 	 	 
	 	CACHET
    FINANCIAL SOLUTIONS, INC.
	 	 	 
	 	By:	/s/
    Jeffrey C. Mack
	 	Name:	Jeffrey
    C. Mack
	 	Title:	Chief
    Executive Officer
	 	 	 
	 	INVESTOR:
	 	 	 
	 	LINCOLN
    PARK CAPITAL FUND, LLC
	 	BY:	LINCOLN
    PARK CAPITAL, LLC
	 	BY:	ROCKLEDGE
    CAPITAL CORPORATION
	 	 	 
	 	By:	/s/
    Josh Scheinfeld
	 	Name:	Josh
    Scheinfeld
	 	Title:	President


 




    	29



    	 



    

 


EXHIBITS


 


	Exhibit
    A 	Form
    of Company Counsel Opinion
	Exhibit
    B	Form
    of Officer’s Certificate
	Exhibit
    C 	Form
    of Resolutions of Board of Directors of the Company
	Exhibit
    D 	Form
    of Secretary’s Certificate
	Exhibit
    E 	Form
    of Letter to Transfer Agent


 




    	30



    	 



    

 


DISCLOSURE
SCHEDULES


 


Schedule
4(a) – Subsidiaries


 


Cachet
Financial Solutions Inc., a Minnesota corporation is a wholly owned subsidiary of the Company


 


Schedule
4(c) – Authorized Capital Stock


 


500,000,000
shares


 


Schedule
4(h) – Absence of Litigation


 


As
previously disclosed, an entity named Cachet Banq contacted Cachet Financial Solutions, Inc. (the “Company”) in December
2010 regarding Cachet Banq’s U.S. Trademark Registration No. 2,857,465 (registered on June 29, 2004) for the standard character
mark CACHET covering “financial services, namely automated clearinghouse processing services for the payroll service industry.”
Cachet Banq alleged that the Company’s use of “CACHET” infringes on their federal trademark registration. On
March 4, 2013, Cachet Banq filed a trademark infringement lawsuit against the Company in the United States District Court for
the Central District of California (the “Court”). The parties then filed cross motions for summary judgment.


 


On
September 21, 2015, the Court issued an Order (1) granting Cachet Banq’s motion for summary judgment, (2) denying the Company’s
motion for summary judgment, (3) ordering Cachet Banq to file a memorandum of points and authorities regarding remedies sought
by it (the “Memorandum”) by September 28, 2015, (4) ordering the Company to file a response to the Memorandum by October
5, 2015 and (5) ordering Cachet Banq to file a reply in support of the Memorandum by October 12, 2015.


 


The
Company believes that the Court’s order was in error, and plans to appeal its decision.


 


Schedule
4(k) – Intellectual Property Rights


 


See
Schedule 4(h)


 


Schedule
4(w) – Certain Fees


 


The
Company may be obligated to pay Scarsdale Equities, LLC or one or more of its affiliates a fee in connection with the sale of
the Purchase Shares hereunder.


 




    	31



    	 



    

 


EXHIBIT
A


 


FORM
OF COMPANY COUNSEL OPINION


 


Capitalized
terms used herein but not defined herein, have the meaning set forth in the Purchase Agreement. Based on the foregoing, and subject
to the assumptions and qualifications set forth herein, we are of the opinion that:


 


1.
The Company is a corporation existing and in good standing under the laws of the State of Delaware.


 


2.
The Company has the corporate power to execute and deliver, and perform its obligations under, each Transaction Document to which
it is a party. To our knowledge, the Company has the corporate power to conduct its business as it is now conducted, and to own
and use the properties owned and used by it.


 


3.
The execution, delivery and performance by the Company of the Transaction Documents to which it is a party have been duly authorized
by all necessary corporate action on the part of the Company. The execution and delivery of the Transaction Documents by the Company,
the performance of the obligations of the Company thereunder and the consummation by it of the transactions contemplated therein
have been duly authorized and approved by the Company’s Board of Directors and no further consent, approval or authorization
of the Company, its Board of Directors or its stockholders is required. The Transaction Documents to which the Company is a party
have been duly executed and delivered by the Company and are the valid and binding obligations of the Company, enforceable against
the Company in accordance with their terms except as such enforceability may be limited by general principles of equity or applicable
bankruptcy, insolvency, reorganization, moratorium, liquidation or similar laws relating to, or affecting creditor’s rights
and remedies.


 


4.
The execution, delivery and performance by the Company of the Transaction Documents and the consummation by the Company of the
transactions contemplated thereby including the offering, sale and issuance of the Commitment Shares and the Purchase Shares in
accordance with the terms and conditions of the Purchase Agreement, do not: (i) conflict with, constitute a breach of or default
(or an event which, with the giving of notice or lapse of time or both, constitutes or could constitute a breach or a default),
under (a) the Certificate of Incorporation or the Bylaws of the Company, (b) to our knowledge, any agreement, note, lease, mortgage,
deed or other material instrument to which the Company is a party or by which the Company or any of its assets are bound attached
as an exhibit to an SEC Document (“Material Agreements”), (ii) to our knowledge, result in any violation of any statute,
law, rule or regulation applicable to the Company, or (iii) to our knowledge, violate any order, writ, injunction or decree applicable
to the Company or any of its subsidiaries.


 


5.
The issuance of the Purchase Shares and the Commitment Shares pursuant to the terms and conditions of the Transaction Documents
has been duly authorized by all necessary corporate action on the part of the Company. Assuming the Commitment Shares were issued
and paid for in accordance with the Purchase Agreement, the Commitment Shares are validly issued, fully paid and non-assessable,
and to our knowledge, free of all taxes, liens, charges, restrictions, rights of first refusal and preemptive rights. 12,000,000
shares of Common Stock have been properly reserved for issuance as Purchase Shares under the Purchase Agreement. When issued and
paid for in accordance with the Purchase Agreement, the Purchase Shares shall be validly issued, fully paid and non-assessable,
and to our knowledge, free of all taxes, liens, charges, restrictions, rights of first refusal and preemptive rights. To our knowledge,
the execution and delivery of the Registration Rights Agreement do not, and the performance by the Company of its obligations
thereunder shall not, give rise to any rights of any other Person for the registration under the Securities Act of any shares
of Common Stock or other securities of the Company which have not been waived.


 




    	32



    	 



    

 


6.
As of the date hereof, the authorized capital stock of the Company consists of 500,000,000 shares of common stock, $0.0001 par
value per share, of which to our knowledge __________ shares are issued and outstanding.


 


7.
Assuming the accuracy of the representations and your compliance with the covenants made by you in the Transaction Documents,
the offering, sale and issuance of the Commitment Shares and the Purchase Shares to you pursuant to the Transaction Documents
is exempt from registration under the Securities Act.


 


8.
Other than that which has been obtained and completed prior to the date hereof, no authorization, approval, consent, filing or
other order of any federal or state governmental body, regulatory agency, or stock exchange or market, or any court, or, to our
knowledge any third party is required to be obtained by the Company to enter into and perform its obligations under the Transaction
Documents or for the Company to issue and sell the Commitment Shares and the Purchase Shares as contemplated by the Transaction
Documents.


 


9.
The Common Stock is registered pursuant to Section 12(g) of the Exchange Act. To our knowledge, since one year preceding the date
of the Purchase Agreement, the Company has been in compliance with the reporting requirements of the Exchange Act applicable to
it. To our knowledge, since one year preceding the date of the Purchase Agreement, the Company has not received any written notice
from any Person stating that the Company has not been in compliance with any of the rules and regulations (including the requirements
for continued listing) of the Principal Market.


 


10.
The Company is not, and after giving effect to the issuance of the Commitment Shares and the Purchase Shares and the application
of the proceeds as described in the Prospectus, will not be, an “investment company,” as that term is defined in the
Investment Company Act of 1940, as amended.


 


11.
Except as described in the Registration Statement and the Prospectus, none of the Material Agreements grants to any person the
right to require the Company to file a registration statement under the Securities Act with respect to any securities of the Company
owned or to be owned by such person or to require the Company to include such securities in the securities registered pursuant
to the Registration Statement or in any securities being registered pursuant to any other registration statement filed by the
Company under the Securities Act.


 


[THE
FOLLOWING MAY BE MADE IN A SEPARATE NEGATIVE ASSURANCES LETTER]


 


As
counsel to the Company, we reviewed the Registration Statement and the Prospectus, and participated in discussions with your representatives
and those of the Company, at which the contents of the Registration Statement and the Prospectus were discussed. Between the date
of the Transaction Documents and the time of the delivery of this letter, we participated in further discussions with your representatives
and those of the Company, and we reviewed certain certificates of officers of the Company and public officials delivered to you
today.


 


The
purpose of our engagement was not to establish or to confirm factual matters set forth in the Registration Statement and the Prospectus,
and we have not undertaken any obligation to verify independently any of the factual matters set forth in the Registration Statement
and the Prospectus. Moreover, many of the determinations required to be made in the preparation of the Registration Statement
and the Prospectus involve matters of a non-legal nature, including without limitation accounting matters.


 




    	33



    	 



    

 


Subject
to the foregoing, we confirm to you that, on the basis of the information that we gained in the course of performing the services
referred to above, nothing came to our attention that caused us to believe that: (a) the Registration Statement, as of its effective
date, contained an untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary
to make the statements therein not misleading, or (b) the Prospectus, as of its date and as of the date and time of delivery of
this letter, contained or contains any untrue statement of a material fact or omitted or omits to state any material fact necessary
to make the statements therein, in light of the circumstances under which they were made, not misleading; provided, however,
that we do not assume any responsibility for the accuracy, completeness or fairness of the statements contained in the Registration
Statement or the Prospectus, and we do not express any belief as to the financial statements and related notes, financial statement
schedules or financial statistics or other financial or accounting data and information contained in or omitted from the Registration
Statement or the Prospectus.


 


We
inform you that the Registration Statement became effective under the Securities Act on _______, 201__ and that no stop order
suspending the effectiveness of the Registration Statement has been issued under the Securities Act.


 


We
are not representing the Company in any pending litigation in which it is a named defendant that challenges the validity or enforceability
of, or seeks to enjoin the performance of, the Transaction Documents.


 


Further,
we confirm to you that the Registration Statement, as of its effective date, and the Prospectus, as of its date, appeared to us
on their face to respond in all material respects to the requirements of Form S-1, except that the foregoing statement does not
address any requirement relating to financial statements, notes or schedules and financial and accounting data or information
contained in or omitted from the Registration Statement or the Prospectus Supplement.


 




    	34



    	 



    

 


EXHIBIT
B


 


FORM
OF OFFICER’S CERTIFICATE


 


This
Officer’s Certificate (“Certificate”) is being delivered pursuant to Section 8(e) of that certain
Purchase Agreement dated as of October 12, 2015 (“Purchase Agreement”), by and between CACHET FINANCIAL
SOLUTIONS, INC. , a Delaware corporation (the “Company”), and LINCOLN PARK CAPITAL FUND, LLC (the
“Investor”). Terms used herein and not otherwise defined shall have the meanings ascribed to them in the Purchase
Agreement.


 


The
undersigned, Darin McAreavey, Chief Financial Officer of the Company, hereby certifies as follows:


 


1.
I am the Chief Financial Officer of the Company and make the statements contained in this Certificate;


 


2.
The representations and warranties of the Company are true and correct in all material respects (except to the extent that any
of such representations and warranties is already qualified as to materiality in Section 4 of the Purchase Agreement, in which
case, such representations and warranties are true and correct without further qualification) as of the date when made and as
of the Commencement Date as though made at that time (except for representations and warranties that speak as of a specific date,
in which case such representations and warranties are true and correct as of such date);


 


3.
The Company has performed, satisfied and complied in all material respects with covenants, agreements and conditions required
by the Transaction Documents to be performed, satisfied or complied with by the Company at or prior to the Commencement Date.


 


4.
The Company has not taken any steps, and does not currently expect to take any steps, to seek protection pursuant to any Bankruptcy
Law nor does the Company or any of its Subsidiaries have any knowledge or reason to believe that its creditors intend to initiate
involuntary bankruptcy or insolvency proceedings.


 


IN
WITNESS WHEREOF, I have hereunto signed my name as of the date first set forth above.


 


	 	 	 
	 	Name:	Darin
    McAreavey
	 	Title:	Chief
    Financial Officer


 


The
undersigned, as Secretary of the Company, hereby certifies that Darin McAreavey is the duly elected, appointed, qualified and
acting Chief Financial Officer of Cachet Financial Solutions, Inc. and that the signature appearing above is his genuine signature.


 


	 	 
	 	Secretary


 




    	35



    	 



    

 


EXHIBIT
C


 


UNANIMOUS
WRITTEN CONSENT OF


THE
BOARD OF DIRECTORS OF


CACHET
FINANCIAL SOLUTIONS, INC.


 


The
undersigned, constituting all of the members of the Board of Directors (the “Board”) of Cachet Financial Solutions,
Inc., a Delaware corporation (the “Corporation”), acting pursuant to Delaware General Corporation Law Section 141(f)
and Section 3.8 of the Company’s Bylaws, hereby adopt the following resolutions in writing:


 


WHEREAS,
there has been presented to the Board of Directors of the Corporation a draft of the Purchase Agreement (the “Purchase Agreement”)
by and between the Corporation and Lincoln Park Capital Fund, LLC (“Lincoln Park”), providing for the purchase by
Lincoln Park of up to Ten Million Dollars ($10,000,000) of the Corporation’s common stock, $0.0001 par value per share (the
“Common Stock”), a copy of which is attached hereto as Appendix A; and


 


WHEREAS,
after careful consideration of the Purchase Agreement, the documents incident thereto and other factors deemed relevant by the
Board of Directors, the Board of Directors has determined that it is advisable and in the best interests of the Corporation to
engage in the transactions contemplated by the Purchase Agreement, including, but not limited to, the issuance of 416,666 shares
of Common Stock to Lincoln Park as a commitment fee (the “Commitment Shares”) and the sale of shares of Common Stock
to Lincoln Park up to the available amount under the Purchase Agreement (the “Purchase Shares”).


 


Transaction
Documents


 


NOW,
THEREFORE, BE IT RESOLVED, that the transactions described in the Purchase Agreement are hereby approved and Jeffrey Mack and
Darin McAreavey (the “Authorized Officers”) are severally authorized to execute and deliver the Purchase Agreement,
and any other agreements or documents contemplated thereby, with such amendments, changes, additions and deletions as the Authorized
Officers deem appropriate to approve on behalf of the Corporation, such approval to be conclusively evidenced by the signature
of an Authorized Officer thereon; and


 


FURTHER
RESOLVED, that the terms and provisions of the registration rights agreement (the “Registration Rights Agreement”)
by and among the Corporation and Lincoln Park, a copy of which is attached hereto as Appendix B, are hereby approved and the Authorized
Officers are authorized to execute and deliver the Registration Rights Agreement (pursuant to the terms of the Purchase Agreement),
with such amendments, changes, additions and deletions as the Authorized Officer deem appropriate to approve on behalf of, the
Corporation, such approval to be conclusively evidenced by the signature of an Authorized Officer thereon; and


 


FURTHER
RESOLVED, that the terms and provisions of the forms of Commencement Irrevocable Transfer Agent Instructions and Notice of Effectiveness
of Registration Statement, copies of which are attached hereto as Appendix C and D respectively (collectively, the “Instructions”),
are hereby approved and the Authorized Officers are authorized to execute and deliver the Instructions on behalf of the Corporation
in accordance with the Purchase Agreement, with such amendments, changes, additions and deletions as the Authorized Officers may
deem appropriate to approve on behalf of the Corporation, such approval to be conclusively evidenced by the signature of an Authorized
Officer thereon; and


 




    	36



    	 



    

 


Issuance
of Common Stock


 


FURTHER
RESOLVED, that the Corporation is hereby authorized to issue to Lincoln Park the Commitment Shares, and that upon issuance of
the Commitment Shares pursuant to the Purchase Agreement, the Commitment Shares shall be duly authorized, validly issued, fully
paid and nonassessable with no personal liability attaching to the ownership thereof; and


 


FURTHER
RESOLVED, that the Corporation is hereby authorized to issue the Purchase Shares in accordance with the terms of the Purchase
Agreement and that, upon issuance of the Purchase Shares pursuant to the Purchase Agreement, the Purchase Shares will be duly
authorized, validly issued, fully paid and nonassessable with no personal liability attaching to the ownership thereof; and


 


FURTHER
RESOLVED, that the Corporation shall initially reserve 12,000,000 shares of Common Stock for issuance as Purchase Shares under
the Purchase Agreement.


 


Approval
of Actions


 


FURTHER
RESOLVED, that, without limiting the foregoing, the Authorized Officers are, and each of them hereby is, authorized and directed
to proceed on behalf of the Corporation and to take all such steps as deemed necessary or appropriate, with the advice and assistance
of counsel, to cause the Corporation to consummate the agreements referred to herein and to perform its obligations under such
agreements; and


 


FURTHER
RESOLVED, that the Authorized Officers be, and each of them hereby is, authorized, empowered and directed on behalf of and in
the name of the Corporation, to take or cause to be taken all such further actions and to execute and deliver or cause to be executed
and delivered all such further agreements, amendments, documents, certificates, reports, schedules, applications, notices, letters
and undertakings and to incur and pay all such fees and expenses as in their judgment shall be necessary, proper or desirable
to carry into effect the purpose and intent of any and all of the foregoing resolutions, and that all actions heretofore taken
by any officer or director of the Corporation in connection with the transactions contemplated by the agreements described herein
are hereby approved, ratified and confirmed in all respects.


 




    	37



    	 



    

 


IN
WITNESS WHEREOF, the Board of Directors has executed and delivered this Consent effective as of October ___, 2015.


 


	 	 
	Jeffrey
    C. Mack	 
	 	 
	 	 
	James
    L. Davis	 
	 	 
	 	 
	Michael
    J. Hanson	 
	 	 
	 	 
	Rod
    Jardine	 


 


being all
of the directors of CACHET FINANCIAL SOLUTIONS, INC.


 




    	38



    	 



    

 


EXHIBIT
D


 


FORM
OF SECRETARY’S CERTIFICATE


 


This
Secretary’s Certificate (“Certificate”) is being delivered pursuant to Section 8(k) of that certain Purchase
Agreement dated as of October 12, 2015 (“Purchase Agreement”), by and between CACHET FINANCIAL SOLUTIONS, INC.,
a Delaware corporation (the “Company”) and LINCOLN PARK CAPITAL FUND, LLC (the “Investor”), pursuant
to which the Company may sell to the Investor up to Ten Million Dollars ($10,000,000) of the Company’s Common Stock, $0.001
par value per share (the “Common Stock”). Terms used herein and not otherwise defined shall have the meanings ascribed
to them in the Purchase Agreement.


 


The
undersigned, ____________, Secretary of the Company, hereby certifies as follows:


 


1.
I am the Secretary of the Company and make the statements contained in this Secretary’s Certificate.


 


2.
Attached hereto as Exhibit A and Exhibit B are true, correct and complete copies of the Company’s Bylaws (“Bylaws”)
and Certificate of Incorporation (“Charter”), in each case, as amended through the date hereof, and no action has
been taken by the Company, its directors, officers or stockholders, in contemplation of the filing of any further amendment relating
to or affecting the Bylaws or Charter.


 


3.
Attached hereto as Exhibit C are true, correct and complete copies of the resolutions duly adopted by the Board of Directors
of the Company on October ___, 2015, at which a quorum was present and acting throughout. Such resolutions have not been amended,
modified or rescinded and remain in full force and effect and such resolutions are the only resolutions adopted by the Company’s
Board of Directors, or any committee thereof, or the stockholders of the Company relating to or affecting (i) the entering into
and performance of the Purchase Agreement, or the issuance, offering and sale of the Purchase Shares and the Commitment Shares
and (ii) and the performance of the Company of its obligation under the Transaction Documents as contemplated therein.


 


4.
As of the date hereof, the authorized, issued and reserved capital stock of the Company is as set forth on Exhibit D hereto.


 


IN
WITNESS WHEREOF, I have hereunto signed my name on this ___ day of October, 2015.


 


	 	 
	 	Secretary


 


The
undersigned, as Chief Financial Officer of the Company, hereby certifies that ____________ is the duly elected, appointed, qualified
and acting Secretary of the Company, and that the signature appearing above is his genuine signature.


 


	 	 


 




    	39



    	 



    

 


EXHIBIT
E


 


FORM
OF LETTER TO THE TRANSFER AGENT FOR THE ISSUANCE OF THE 

COMMITMENTS SHARES AT SIGNING OF THE PURCHASE AGREEMENT


 


[COMPANY
LETTERHEAD]


 


[DATE]


 


[TRANSFER
AGENT]

__________________

__________________

__________________


 


Re: Issuance
of Common Stock to Lincoln Park Capital Fund, LLC


 


Dear ________,


 


On
behalf of CACHET FINANCIAL SOLUTIONS, INC. (the “Company”), you are hereby instructed to issue as soon
as possible a share certificate representing an aggregate of 416,666 shares of our common stock in the name of Lincoln
Park Capital Fund, LLC. The share certificate should be dated [DATE OF THE PURCHASE AGREEMENT]. I have included a true
and correct copy of a unanimous written consent executed by all of the members of the Board of Directors of the Company adopting
resolutions approving the issuance of these shares. The share certificate should bear the following restrictive legend:


 


THE
SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE
STATE SECURITIES LAWS. THE SECURITIES HAVE BEEN ACQUIRED FOR INVESTMENT AND MAY NOT BE OFFERED FOR SALE, SOLD, TRANSFERRED OR
ASSIGNED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT FOR THE SECURITIES UNDER THE SECURITIES ACT OF 1933, AS AMENDED,
OR APPLICABLE STATE SECURITIES LAWS, UNLESS SOLD PURSUANT TO: (1) RULE 144 UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR (2)
AN OPINION OF HOLDER’S COUNSEL, IN A CUSTOMARY FORM, THAT REGISTRATION IS NOT REQUIRED UNDER SAID ACT OR APPLICABLE STATE
SECURITIES LAWS.


 




    	40



    	 



    

 


The share
certificate should be sent as soon as possible via overnight mail to the following address:


 


Lincoln
Park Capital Fund, LLC


440
North Wells, Suite 410


Chicago,
IL 60654


Attention:
Josh Scheinfeld/Jonathan Cope


 


Thank you
very much for your help. Please call me at ______________ if you have any questions or need anything further.


 


CACHET
FINANCIAL SOLUTIONS, INC.


 


	BY	 	 
	 	Darin
    McAreavey	 
	 	Chief
    Financial Officer	 


 




    	41