SECURITIES
PURCHASE AGREEMENT


 


This
Securities Purchase Agreement (this “Agreement”) is dated as of December 15, 2017 between MGT Capital
Investments, Inc., a Delaware corporation (the “Company”), and each purchaser identified on the signature
pages hereto (each, including its successors and assigns, a “Purchaser” and collectively, the “Purchasers”).


 


WHEREAS,
subject to the terms and conditions set forth in this Agreement and pursuant to Section 4(2) of the Securities Act of 1933, as
amended (the “Securities Act”), and Rule 506 promulgated thereunder, the Company desires to issue and sell
to each Purchaser, and each Purchaser, severally and not jointly, desires to purchase from the Company, securities of the Company
as more fully described in this Agreement.


 


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


 


ARTICLE
I.

DEFINITIONS


 


1.1
Definitions. In addition to the terms defined elsewhere in this Agreement, capitalized terms that are not otherwise defined
herein have following terms have the meanings set forth in this Section 1.1:


 


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


 


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


 


“Business
Day” means any day except Saturday, Sunday, any day which is a federal legal holiday in the United States or any day
on which banking institutions in the State of New York are authorized or required by law or other governmental action to close.


 


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


 


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


 


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


 


“Common
Stock” means the common stock of the Company, par value $.001 per share, and any other class of securities into which
such securities may hereafter be reclassified or changed into.


 


“Company
Counsel” means Sichenzia Ross Ference Kesner LLP, 1185 Avenue of the Americas, New York, New York 10036.


 


“Disclosure
Schedules” shall have the meaning ascribed to such term in Section 2.1.


 


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


 




    	 	 	 



    	 



    





 


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


 


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


 


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


 


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


 


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


 


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


 


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


 


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


 


“SEC
Reports” means the reports, forms, statements and other documents required to be filed by the Company under the Exchange
Act.


 


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


 


“Subsidiary”
means any subsidiary of the Company and shall, where applicable, include any direct or indirect subsidiary of the Company formed
or acquired after the date hereof.


 


“Transaction
Documents” means this Agreement all exhibits and schedules thereto and hereto and any other documents or agreements
executed in connection with the transactions contemplated hereunder.


 




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ARTICLE
II. PURCHASE AND SALE


 


2.1
Closing. On the Closing Date, upon the terms and subject to the conditions set forth herein, substantially concurrent with
the execution and delivery of this Agreement by the parties hereto, the Company agrees to sell, and the Purchasers, severally
and not jointly, agree to purchase, up to an aggregate of $____ (the “Purchase Price”) in principal amount of the
Company’s Common Stock, at a purchase price of Four dollars ($4.00) per share (the “Per Share Purchase
Price”). In addition, for each share of Common Stock purchased by a Purchaser (each, a “Share”), the Purchaser
shall receive a detachable Warrant to purchase shares of Common Stock substantially in the form attached hereto as Exhibit
A (the “Warrant”) exercisable into the same number of shares of Common Stock at a price of $4.50, subject to terms
and conditions specified in the Warrant. Each Purchaser shall deliver to the Company, in accordance with the terms set forth in
the Subscription Agreement, via wire transfer or a certified check, immediately available funds equal to such Purchaser’s
Subscription Amount as set forth on the signature page hereto executed by such Purchaser and the Company shall deliver to each
Purchaser its respective Securities pursuant to Section 2.2(a) and Section 2.2(c). The Company and each Purchaser shall deliver
the other items set forth in Section 2.2, deliverable at the Closing. Upon satisfaction of the conditions set forth in Section
2.3 hereof, the Closing shall occur at the offices of Company Counsel or such other location as the parties shall mutually agree.


 


2.2
Deliverables.


 


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


 


(i)
this Agreement duly executed by the Company; and


 


(ii)
the Warrant duly executed by the Company.


 


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


 


(i)
this Agreement duly executed by such Purchaser; and


 


(ii)
such Purchaser’s Subscription Amount by wire transfer to the account as specified in writing by the Company.


 


(c)
Notwithstanding the foregoing or anything to the contrary herein, the Company will not issue or otherwise put in the Purchaser’s
name any Shares until the satisfaction of each of the following conditions (the “Share Delivery Conditions”): (i)
no Shares shall be delivered prior to the date that is six (6) months from the date hereof; (ii) the Purchaser shall have delivered
to the Company written notice specifying the number of Shares to be delivered (a “Share Delivery Notice”); and (iii)
such delivery of Shares will not result in the Purchaser owning Common Stock in excess of the Maximum Percentage (as defined below).
Upon satisfaction of the Share Delivery Conditions, the Company will deliver the number of Shares specified in the applicable
Share Delivery Notice within four (4) Business Days of the Purchaser’s delivery of the applicable Share Delivery Notice.


 


(d)
In the event the Company fails to deliver Shares within four (4) Business Days of the Purchaser’s delivery of a Share Delivery
Notice to the Company, then in such event a late fee equal to 2% of the aggregate Purchase Price (but in any event the cumulative
amount of such late fees for each delivery failure shall not exceed 200% of the aggregate Purchase Price) will be assessed for
each day beginning on the date that is five (5) Business Days from the date the Purchaser delivered the applicable Share Delivery
Notice to the Company until the applicable Shares are delivered to the Purchaser.


 




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2.3
Closing Conditions.




 


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


 


(i)
the accuracy in all material respects on the Closing Date of the representations and warranties of the Purchasers contained herein;


 


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


 


(iii)
the delivery by each Purchaser of the Subscription Amount as set forth in Section 2.2(b) of this Agreement.


 


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


 


(i)
the accuracy in all material respects when made and on the Closing Date of the representations and warranties of the Company contained
herein;


 


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


 


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


 


(iv)
there shall have been no Material Adverse Effect with respect to the Company since the date hereof.


 


ARTICLE
III. 

REPRESENTATIONS AND WARRANTIES


 


3.1
Representations and Warranties of the Company. Except as may set forth in any various schedules to this Agreement (the
“Disclosure Schedules”), which Disclosure Schedules shall be deemed a part hereof and shall qualify any representation
or otherwise made herein to the extent of the disclosure contained in the corresponding section of the Disclosure Schedules, the
Company hereby makes the following representations and warranties to each Purchaser:


 


(a)
Organization and Qualification. The Company and each of the Subsidiaries is an entity duly incorporated or otherwise organized,
validly existing and in good standing under the laws of the jurisdiction of its incorporation or organization, with the requisite
power and authority to own and use its properties and assets and to carry on its business as currently conducted. Neither the
Company nor any Subsidiary is in violation nor default of any of the provisions of its respective certificate or articles of incorporation,
bylaws or other organizational or charter documents. Each of the Company and the Subsidiaries is duly qualified to conduct business
and is in good standing as a foreign corporation or other entity in each jurisdiction in which the nature of the business conducted
or property owned by it makes such qualification necessary, except where the failure to be so qualified or in good standing, as
the case may be, could not have or reasonably be expected to result in: (i) a material adverse effect on the legality, validity
or enforceability of any Transaction Document, (ii) a material adverse effect on the results of operations, assets, business,
prospects or condition (financial or otherwise) of the Company and the Subsidiaries, taken as a whole, or (iii) a material adverse
effect on the Company’s ability to perform in any material respect on a timely basis its obligations under any Transaction
Document (any of (i), (ii) or (iii), a “Material Adverse Effect”) and except as set forth under Schedule 3.1(a),
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.


 




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


 


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


 


(d)
Filings, Consents and Approvals. The Company is not required to obtain any consent, waiver, authorization or order of,
or make any filing or registration with, any court or other federal, state, local or other governmental authority or other Person
in connection with the execution, delivery and performance by the Company of the Transaction Documents, other than: (i) the filings
required pursuant to Section 4.7 and (ii) such consents, waivers, or authorizations as have been obtained before the Closing (collectively,
the “Required Approvals”).


 












(e)
Issuance of the Securities. The Securities are duly authorized and, when issued and paid for in accordance with the applicable
Transaction Documents, will be duly and validly issued, fully paid and nonassessable, free and clear of all Liens imposed by the
Company other than restrictions on transfer provided for in the Transaction Documents.


 


(f)
Capitalization. The capitalization of the Company prior to Closing is as set forth in the Company’s SEC Reports.
Other than as set forth in the SEC Reports, no Person has any right of first refusal, preemptive right, right of participation,
or any similar right to participate in the transactions contemplated by the Transaction Documents except for such, if any, as
will have been validly waived before the Closing. The issuance and sale of the Securities will not obligate the Company to issue
shares of Common Stock or other securities to any Person (other than the Purchasers) and will not result in a right of any holder
of Company securities to adjust the exercise, conversion, exchange or reset price under any of such securities. All of the outstanding
shares of capital stock of the Company are validly issued, fully paid and nonassessable, have been issued in compliance with all
federal and state securities laws, and none of such outstanding shares was issued in violation of any preemptive rights or similar
rights to subscribe for or purchase securities. No further approval or authorization of any stockholder, the Board of Directors
or others is required for the issuance and sale of the Securities.



 






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(g)
Litigation. There is no action, suit, inquiry, notice of violation, proceeding or investigation pending or, to the knowledge
of the Company, threatened against or affecting the Company, any Subsidiary or any of their respective properties before or by
any court, arbitrator, governmental or administrative agency or regulatory authority (federal, state, county, local or foreign)
(collectively, an “Action”) which (i) adversely affects or challenges the legality, validity or enforceability
of any of the Transaction Documents or (ii) could, if there were an unfavorable decision, have or reasonably be expected to result
in a Material Adverse Effect. Neither the Company nor any Subsidiary, nor any director or officer thereof, is or has been the
subject of any Action involving a claim of violation of or liability under federal or state securities laws or a claim of breach
of fiduciary duty.


 


(h)
Compliance. To the Company’s knowledge, neither the Company nor any Subsidiary: (i) is in default under or in violation
of (and no event has occurred that has not been waived that, with notice or lapse of time or both, would result in a default by
the Company or any Subsidiary under), nor has the Company or any Subsidiary received notice of a claim that it is in default under
or that it is in violation of, any indenture, loan or credit agreement or any other material agreement or instrument to which
it is a party or by which it or any of its properties is bound (whether or not such default or violation has been waived), (ii)
is in violation of any order of any court, arbitrator or governmental body or (iii) is or has been in violation of any statute,
rule or regulation of any governmental authority, including without limitation all foreign, federal, state and local laws applicable
to its business, except in each of the foregoing cases as could not have or reasonably be expected to result in a Material Adverse
Effect.


 






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



 



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(j)
Title to Assets. The Company and the Subsidiaries have good and marketable title in fee simple to all real property and
good and marketable title in all personal property owned by it that, in each case, is material to the business of the Company
and the Subsidiaries, in each case free and clear of all Liens, 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 the Subsidiaries
and Liens for the payment of federal, state or other taxes, the payment of which is neither delinquent nor subject to penalties
in any material respect. Any real property and facilities held under lease by the Company and the Subsidiaries are held by them
under valid, subsisting and enforceable leases with which the Company and the Subsidiaries are in compliance.


 


(k)
Certain Fees. 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. The Purchasers shall have no obligation with respect to any fees or with respect to any claims made
by or on behalf of other Persons for fees of a type contemplated in this Section that may be due in connection with the transactions
contemplated by the Transaction Documents.


 


(l)
Private Placement. Assuming the accuracy of the Purchasers’ representations and warranties set forth in Section 3.2,
no registration under the Securities Act is required for the offer and sale of the Securities by the Company to the Purchasers
as contemplated hereby.


 


(m)
Tax Status. Except for matters that would not, individually or in the aggregate, have or reasonably be expected to result
in a Material Adverse Effect, the Company and each Subsidiary has filed all necessary federal, state and foreign income and franchise
tax returns and has paid or accrued all taxes shown as due thereon, and the Company has no knowledge of a tax deficiency which
has been asserted or threatened against the Company or any Subsidiary.


 


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


 






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


 


3.2
Representations and Warranties of the Purchasers. Each Purchaser, for itself and for no other Purchaser, hereby represents
and warrants as of the date hereof and as of the Closing Date to the Company as follows:


 







(a)
Organization; Authority. The Purchaser, (i) if a natural person, represents that the Purchaser has reached the age of 21
and has full power and authority to execute and deliver this Securities Purchase Agreement and all other related agreements or
certificates and to carry out the provisions hereof and thereof; (ii) if a corporation, partnership, or limited liability company,
or association, joint stock company, trust, unincorporated organization or other entity, it is duly organized, validly existing
and in good standing under the laws of the jurisdiction of its organization with full right, corporate or partnership power and
authority to enter into and to consummate the transactions contemplated by the Transaction Documents and otherwise to carry out
its obligations hereunder and thereunder. The execution and delivery of the Transaction Documents and performance by such Purchaser
of the transactions contemplated by the Transaction Documents have been duly authorized by all necessary corporate or similar
action on the part of such Purchaser. Each Transaction Document to which it is a party has been duly executed by such Purchaser,
and when delivered by such Purchaser in accordance with the terms hereof, will constitute the valid and legally binding obligation
of such Purchaser, enforceable against it in accordance with its terms, except: (i) as limited by general equitable principles
and applicable bankruptcy, insolvency, reorganization, moratorium and other laws of general application affecting enforcement
of creditors’ rights generally, (ii) as limited by laws relating to the availability of specific performance, injunctive
relief or other equitable remedies and (iii) insofar as indemnification and contribution provisions may be limited by applicable
law.


 


(b)
Own Account. Such Purchaser understands that the Securities are “restricted securities” and have not been registered
under the Securities Act or any applicable state securities law and is acquiring the Securities as principal for its own account
and not with a view to or for distributing or reselling such Securities or any part thereof in violation of the Securities Act
or any applicable state securities law, has no present intention of distributing any of such Securities in violation of the Securities
Act or any applicable state securities law and has no direct or indirect arrangement or understandings with any other persons
to distribute or regarding the distribution of such Securities in violation of the Securities Act or any applicable state securities
law. Such Purchaser is acquiring the Securities hereunder in the ordinary course of its business.


 


(c)
Purchaser Status. At the time such Purchaser was offered the Securities, it was, and as of the date hereof it is, an “accredited
investor” within the meaning of Regulation D, Rule 501(a), promulgated by the Commission under the Securities Act and will
submit to the Company such further assurances of such status as may be reasonably requested by the Company.


 


(d)
Experience of Such Purchaser. Such Purchaser, either alone or together with its representatives, has such knowledge, sophistication
and experience in business and financial matters so as to be capable of evaluating the merits and risks of the prospective investment
in the Securities, and has so evaluated the merits and risks of such investment. Such Purchaser is able to bear the economic risk
of an investment in the Securities and, at the present time, is able to afford a complete loss of such investment. The Purchaser
and its advisers, if any, have had a reasonable opportunity to ask questions of and receive answers from a person or persons acting
on behalf of the Company concerning the offering and the business, financial condition and results of operations of the Company,
and all such questions have been answered to the full satisfaction of the Purchaser and its advisers, if any;


 






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(e)
Non-Reliance. In evaluating the suitability of an investment in the Company, the Purchaser has not relied upon any representation
or information (oral or written) other than as stated in this Agreement;



 


(f)
Risk Factors.


 


(i)
The Purchaser understands and agrees that purchase of the Securities is a high-risk investment and the Purchaser is able to afford
an investment in a speculative venture having the risks and objectives of the Company. The Purchase has carefully read and considered
the matters set forth this Agreement and, the matters contained in the Company’s SEC Reports, including those matters set
forth under the caption “Risk Factors” contained in Company’s various SEC Reports. Purchaser understands that
any of such risk may materially adversely affect the Company’s operations and future prospects.


 


(ii)
The Purchase is aware that a number of law firms have announced that they are investigating claims on behalf of shareholders of
the Company regarding potential violations of the Exchange Act. In addition, the Company and its Board of Directors have been
served with a Summons and Complaint alleging that the members of the Board of Directors have breached their fiduciary duties.
While the Company and the Board of Directors believe that there are no merits to the alleged claims, the results of any investigation,
or the outcome of any claims that may brought against the Company or its Board of Directors cannot be predicted with certainty.
Moreover, regardless of the outcome, investigations can have an adverse impact on us because it may entail a significant amount
of costs to defend the Company against any claims, such claims may negatively affect morale of employees and may divert the attention
of management.


 


(iii)
The Purchaser is aware that it must bear the substantial economic risks of the investment in the Securities indefinitely because
none of the Securities may be publicly sold, hypothecated or otherwise disposed of unless subsequently registered under the Securities
Act and applicable state securities laws or an exemption from such registration is available. Legends will be placed on the certificates
representing the Securities to the effect that such securities have not been registered under the Securities Act or applicable
state securities laws and appropriate notations thereof will be made in the Company’s books.


 


(g)
Public Filings. The Purchaser is aware that an investment in the Securities involves a number of very significant risks
and has carefully read and considered the disclosure in the Company’s Form 10-K for the year ended December 31, 2016, its
Form 10-Q for the quarter ended September 30, 2017, and all other disclosure filings made by the Company which are available on
the Edgar System at SEC.gov and understands that certain risks may materially adversely affect the Company’s operations
and future prospects


 


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


 


(i)
Acknowledgment of Restricted Securities. The Purchaser has read and understands the following:


 


THE
SECURITIES OFFERED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT, OR ANY STATE SECURITIES LAWS AND ARE BEING OFFERED
AND SOLD IN RELIANCE ON EXEMPTIONS FROM THE REGISTRATION REQUIREMENTS OF SAID ACT AND SUCH LAWS. THE SECURITIES ARE SUBJECT TO
RESTRICTIONS ON TRANSFERABILITY AND RESALE AND MAY NOT BE TRANSFERRED OR RESOLD EXCEPT AS PERMITTED UNDER SAID ACT AND SUCH LAWS
PURSUANT TO REGISTRATION OR EXEMPTION THEREFROM. THE SECURITIES HAVE NOT BEEN RECOMMENDED, APPROVED OR DISAPPROVED BY THE SECURITIES
AND EXCHANGE COMMISSION, ANY STATE SECURITIES COMMISSION OR ANY OTHER REGULATORY AUTHORITY, NOR HAVE ANY OF THE FOREGOING AUTHORITIES
PASSED UPON OR ENDORSED THE MERITS OF THIS OFFERING OR THE ACCURACY OR ADEQUACY OF THE MEMORANDUM OR THIS SECURITIES PURCHASE
AGREEMENT. ANY REPRESENTATION TO THE CONTRARY IS UNLAWFUL


 




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ARTICLE
IV.


OTHER
AGREEMENTS OF THE PARTIES


 


4.1
Transfer Restrictions.


 


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


 


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


 


[NEITHER
THIS SECURITY [NOR THE SECURITIES INTO WHICH THIS SECURITY IS [EXERCISEABLE]] HAS [NOT] BEEN REGISTERED WITH THE SECURITIES AND
EXCHANGE COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE IN RELIANCE UPON AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES
ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO AN
EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT
SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS AS EVIDENCED
BY A LEGAL OPINION OF COUNSEL TO THE TRANSFEROR TO SUCH EFFECT, THE SUBSTANCE OF WHICH SHALL BE REASONABLY ACCEPTABLE TO THE COMPANY.
THIS SECURITY MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT OR OTHER LOAN SECURED BY SUCH SECURITIES.


 


(c)
Certificates evidencing the shares of Securities shall be eligible for removal of the restrictive legend, (a) following any sale
of such shares of Securities pursuant to Rule 144, or (b) if such Securities are eligible for sale under Rule 144, without the
requirement for the Company to be in compliance with the current public information required under Rule 144 as to such Securities
and without volume or manner- of-sale restrictions, (c) following any sale of such shares of Securities, pursuant to the plan
of distribution in an effective registration statement (in compliance with any prospectus delivery requirements), or (d) if such
legend is not required under applicable requirements of the Securities Act (including judicial interpretations and pronouncements
issued by the staff of the Commission) (the “Removal Date”). The Company shall cause its counsel to
issue a legal opinion to its transfer agent promptly after the Removal Date if required by the transfer agent to effect the removal
of the legend hereunder as permitted by applicable law then in effect. The Company agrees that following the Removal Date, it
will, no later than five (5) trading days following the delivery by a Purchaser to the Company or the transfer agent of a certificate
representing the Securities, as the case may be, issued with a restrictive legend, together with any reasonable certifications
requested by the Company, the Company’s counsel or the transfer agent (such fifth (5th) trading day, the “Legend
Removal Date”), deliver or cause to be delivered to such Purchaser a certificate representing such shares that is
free from all restrictive and other legends. The Company may not make any notation on its records or give instructions to the
transfer agent that enlarge the restrictions on transfer set forth herein. Certificates for Securities subject to legend removal
hereunder shall be transmitted by the transfer agent to the Purchaser by crediting the account of the Purchaser’s prime
broker with the Depository Trust Company System as directed by such Purchaser if the transfer agent is then a participant in such
system and the Company is eligible to use such system and as directed by such Purchaser if either (i) there is an effective registration
statement permitting the resale of such Securities by the Purchaser (and the Purchaser provides the Company or the Company’s
counsel with any requested certifications with respect to future sales of such shares) or (ii) the shares are eligible for resale
by the Purchaser under Rule 144, without the requirement for the Company to be in compliance with the current public information
required under Rule 144 as to such Securities and without volume or manner-of-sale restrictions.


 




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


 


4.2
Integration. The Company shall not sell, offer for sale or solicit offers to buy or otherwise negotiate in respect of any
security (as defined in Section 2 of the Securities Act) that would be integrated with the offer or sale of the Securities to
the Purchasers in a manner that would require the registration under the Securities Act of the sale of the Securities to the Purchasers.


 


4.3
Use of Proceeds. The Company shall use the net proceeds from the sale of the Securities hereunder for general working capital
purposes.


 


4.4
Equal Treatment of Purchasers. No consideration (including any modification of any Transaction Document) shall be offered
or paid to any Person to amend or consent to a waiver or modification of any provision of any of the Transaction Documents unless
the same consideration is also offered to all parties to the Transaction Documents. For clarification purposes, this provision
constitutes a separate right granted to each Purchaser by the Company and negotiated separately by each Purchaser, and is intended
for the Company to treat the Purchasers as a class and shall not in any way be construed as the Purchasers acting in concert or
as a group with respect to the purchase, disposition or voting of Securities or otherwise.


 


4.5
Form D; Blue Sky Filings. The Company agrees to timely file a Form D with respect to the Securities as required under Regulation
D and to provide a copy thereof, promptly upon request of any Purchaser. The Company shall take such action as the Company shall
reasonably determine is necessary in order to obtain an exemption for, or to qualify the Securities for, sale to the Purchasers
at the Closing under applicable securities or “Blue Sky” laws of the states of the United States, and shall provide
evidence of such actions promptly upon request of any Purchaser.


 


4.6
Share Reserve. In order to allow for, as of the relevant date of determination, the purchase of all of the Shares to be
purchased hereunder, the Company shall take all action necessary from time to time to reserve for the benefit of the Purchaser
a number of authorized but unissued shares of Common Stock equal to the number of Shares being purchased by Purchaser hereunder
(such amount is referred to as the “Share Reserve”). If at any time the Share Reserve is less than required
herein, the Company shall immediately increase the Share Reserve in an amount equal to no less than the deficiency. If the Company
does not have sufficient authorized and unissued shares of Common Stock available to increase the Share Reserve, the Company shall
call a special meeting of the stockholders as soon as practicable after such occurrence, but in no event later than thirty (30)
calendar days after such occurrence, and hold such meeting as soon as practicable thereafter, but in no event later than sixty
(60) calendar days after such occurrence, for the sole purpose of increasing the number of authorized shares of Common Stock.
The Company’s management shall recommend to the Company’s stockholders to vote in favor of increasing the number of
authorized shares of Common Stock. Management shall also vote all of its shares in favor of increasing the number of authorized
shares of Common Stock. The Company shall use its best efforts to cause such additional shares of Common Stock to be authorized
so as to comply with the requirements of this subsection.


 




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4.7
Ownership Limitation. Notwithstanding anything to the contrary contained in this Agreement, if at any time the Purchaser
shall or would be issued shares of Common Stock hereunder, but such issuance would cause the Purchaser (together with its affiliates)
to own a number of shares exceeding 4.99% of the number of shares of Common Stock outstanding on such date (the “Maximum
Percentage”), the Company must not issue to the Purchaser shares of the Common Stock which would exceed the Maximum Percentage.
The shares of Common Stock issuable to the Purchaser that would cause the Maximum Percentage to be exceeded are referred to herein
as the “Ownership Limitation Shares”. The Company will reserve the Ownership Limitation Shares for the exclusive benefit
of the Purchaser. From time to time, the Purchaser may notify the Company in writing of the number of the Ownership Limitation
Shares that may be issued to the Purchaser without causing the Purchaser to exceed the Maximum Percentage. Upon receipt of such
notice, the Company shall be unconditionally obligated to immediately issue such designated shares to the Purchaser, with a corresponding
reduction in the number of the Ownership Limitation Shares. For purposes of this Section, beneficial ownership of Common Stock
will be determined under Section 13(d) of the Exchange Act. By written notice to the Company, the Purchaser may increase, decrease
or waive the Maximum Percentage as to itself but any such waiver will not be effective until the 61st day after delivery thereof.
The foregoing 61-day notice requirement is enforceable, unconditional and non-waivable and shall apply to all affiliates and assigns
of the Purchaser.


 


ARTICLE
V.

MISCELLANEOUS


 


5.1
Termination. This Agreement may be terminated by any party hereto without any effect whatsoever on the obligations between
the Company and the other Purchasers, by written notice to the other parties, if the Closing has not been consummated on or before
December 31, 2017; provided, however, that such termination will not affect the right of any party to sue for any
breach by the other party (or parties). Notwithstanding the foregoing, once the Purchaser has delivered the Purchase Price to
the Company, the Company may not terminate this Agreement for any reason and shall be obligated to deliver the Shares and the
Warrant to the Purchaser in accordance with the terms of this Agreement.


 


5.2
Fees and Expenses. Except as expressly set forth in the Transaction Documents to the contrary, each party shall pay the
fees and expenses of its advisers, counsel, accountants and other experts, if any, and all other expenses incurred by such party
incident to the negotiation, preparation, execution, delivery and performance of this Agreement. The Company shall pay all transfer
agent fees, stamp taxes and other taxes and duties levied in connection with the delivery of any Securities to the Purchasers.


 


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


 












5.4
Notices. Any and all notices or other communications or deliveries required or permitted to be provided hereunder shall
be in writing and shall be deemed given and effective on the earliest of: (a) one Business Day after the date of transmission,
if such notice or communication is delivered via facsimile at the facsimile number set forth on the signature pages attached hereto
prior to 5:30 p.m. (New York City time) on a Business Day, with written confirmation of successful transmission, (b) the next
Business Day after the date of transmission, if such notice or communication is delivered via facsimile at the facsimile number
set forth on the signature pages attached hereto on a day that is not a Business Day or later than 5:30 p.m. (New York City time)
on any Business Day, (c) the second Business Day following the date of mailing, if sent by U.S. nationally recognized overnight
courier service or (d) upon actual receipt by the party to whom such notice is required to be given. The address for such notices
and communications shall be as set forth on the signature pages attached hereto.


 


5.5
Amendments; Waivers. No provision of this Agreement may be waived, modified, supplemented or amended except in a written
instrument signed, in the case of an amendment, by the Company and the Purchasers, in the case of a waiver, by the party against
whom enforcement of any such waived provision is sought. No waiver of any default with respect to any provision, condition or
requirement of this Agreement shall be deemed to be a continuing waiver in the future or a waiver of any subsequent default or
a waiver of any other provision, condition or requirement hereof, nor shall any delay or omission of any party to exercise any
right hereunder in any manner impair the exercise of any such right.



 






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


 


5.7
Successors and Assigns. This Agreement shall be binding upon and inure to the benefit of the parties and their successors
and permitted assigns. The Company may not assign this Agreement or any rights or obligations hereunder without the prior written
consent of each Purchaser (other than by merger). Any Purchaser may assign any or all of its rights under this Agreement to any
Person to whom such Purchaser assigns or transfers any Securities, provided that such transfer complies with all applicable federal
and state securities laws and that such transferee agrees in writing with the Company to be bound, with respect to the transferred
Securities, by the provisions of the Transaction Documents that apply to the “Purchasers.”


 


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


 


5.9
Governing Law. All questions concerning the construction, validity, enforcement and interpretation of the Transaction Documents
shall be governed by and construed and enforced in accordance with the internal laws of the State of New York, without regard
to the principles of conflicts of law thereof. Each party agrees that all legal proceedings concerning the interpretations, enforcement
and defense of the transactions contemplated by this Agreement and any other Transaction Documents (whether brought against a
party hereto or its respective affiliates, directors, officers, shareholders, employees or agents) shall be commenced exclusively
in the state and federal courts sitting in the City of New York. Each party hereby irrevocably submits to the exclusive jurisdiction
of the state and federal courts sitting in the City of New York, borough of Manhattan for the adjudication of any dispute hereunder
or in connection herewith or with any transaction contemplated hereby or discussed herein (including with respect to the enforcement
of any of the Transaction Documents), and hereby irrevocably waives, and agrees not to assert in any 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 improper
or is an inconvenient venue for such proceeding. Each party hereby irrevocably waives personal service of process and consents
to process being served in any such suit, action or proceeding by mailing a copy thereof via registered or certified mail or overnight
delivery (with evidence of delivery) to such party at the address in effect for notices to it under this Agreement and agrees
that such service shall constitute good and sufficient service of process and notice thereof. Nothing contained herein shall be
deemed to limit in any way any right to serve process in any other manner permitted by law. If either party shall commence an
action or proceeding to enforce any provisions of the Transaction Documents, then the prevailing party in such action or proceeding
shall be reimbursed by the other party for its reasonable attorneys’ fees and other costs and expenses incurred with the
investigation, preparation and prosecution of such action or proceeding.


 







5.10
Survival. The representations and warranties shall survive the Closing and the delivery of the Securities until, with respect
to each Purchaser, the Securities held by such Purchaser has been exercised in full at which time they shall expire such respect
to Purchaser and shall no longer be of any force or effect.


 


5.11
Execution. This Agreement may be executed in two or more counterparts, all of which when taken together shall be considered
one and the same agreement and shall become effective when counterparts have been signed by each party and delivered to the other
party, it being understood that both parties need not sign the same counterpart. In the event that any signature is delivered
by facsimile transmission or by e-mail delivery of a “.pdf” format data file, such signature shall create a valid
and binding obligation of the party executing (or on whose behalf such signature is executed) with the same force and effect as
if such facsimile or “.pdf” signature page were an original thereof.


 


5.12
Severability. If any term, provision, covenant or restriction of this Agreement is held by a court of competent jurisdiction
to be invalid, illegal, void or unenforceable, the remainder of the terms, provisions, covenants and restrictions set forth herein
shall remain in full force and effect and shall in no way be affected, impaired or invalidated, and the parties hereto shall use
their commercially reasonable efforts to find and employ an alternative means to achieve the same or substantially the same result
as that contemplated by such term, provision, covenant or restriction. It is hereby stipulated and declared to be the intention
of the parties that they would have executed the remaining terms, provisions, covenants and restrictions without including any
of such that may be hereafter declared invalid, illegal, void or unenforceable.


 






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5.13
Replacement of Securities. If any certificate or instrument evidencing any Securities is mutilated, lost, stolen or destroyed,
the Company shall issue or cause to be issued in exchange and substitution for and upon cancellation thereof (in the case of mutilation),
or in lieu of and substitution therefor, a new certificate or instrument, but only upon receipt of evidence reasonably satisfactory
to the Company of such loss, theft or destruction. The applicant for a new certificate or instrument under such circumstances
shall also pay any reasonable third-party costs (including customary indemnity) associated with the issuance of such replacement
Securities.


 


5.14
Remedies. In addition to being entitled to exercise all rights provided herein or granted by law, including recovery of
damages, each of the Purchasers and the Company will be entitled to specific performance under the Transaction Documents. The
parties agree that monetary damages may not be adequate compensation for any loss incurred by reason of any breach of obligations
contained in the Transaction Documents and hereby agrees to waive and not to assert in any action for specific performance of
any such obligation the defense that a remedy at law would be adequate.


 







5.15
Independent Nature of Purchasers’ Obligations and Rights . The obligations of each Purchaser under any Transaction
Document are several and not joint with the obligations of any other Purchaser, and no Purchaser shall be responsible in any way
for the performance or non-performance of the obligations of any other Purchaser under any Transaction Document. Nothing contained
herein or in any other Transaction Document, and no action taken by any Purchaser pursuant thereto, shall be deemed to constitute
the Purchasers as a partnership, an association, a joint venture or any other kind of entity, or create a presumption that the
Purchasers are in any way acting in concert or as a group with respect to such obligations or the transactions contemplated by
the Transaction Documents. Each Purchaser shall be entitled to independently protect and enforce its rights, including, without
limitation, the rights arising out of this Agreement or out of the other Transaction Documents, and it shall not be necessary
for any other Purchaser to be joined as an additional party in any proceeding for such purpose. Each Purchaser has been represented
by its own separate legal counsel in their review and negotiation of the Transaction Documents. The Company has elected to provide
all Purchasers with the same terms and Transaction Documents for the convenience of the Company and not because it was required
or requested to do so by the Purchasers.


 


5.16
Saturdays, Sundays, Holidays, etc. If the last or appointed day for the taking of any action or the expiration of any right
required or granted herein shall not be a Business Day, then such action may be taken, or such right may be exercised on the next
succeeding Business Day.


 


5.17
Construction. The parties agree that each of them and/or their respective counsel has reviewed and had an opportunity to
revise the Transaction Documents and, therefore, the normal rule of construction to the effect that any ambiguities are to be
resolved against the drafting party shall not be employed in the interpretation of the Transaction Documents or any amendments
hereto.


 


5.18
WAIVER OF JURY TRIAL. IN ANY ACTION,
SUIT, OR PROCEEDING IN ANY JURISDICTION BROUGHT BY ANY PARTY AGAINST ANY OTHER PARTY, THE PARTIES EACH KNOWINGLY AND INTENTIONALLY,
TO THE GREATEST EXTENT PERMITTED BY APPLICABLE LAW, HEREBY ABSOLUTELY, UNCONDITIONALLY, IRREVOCABLY AND EXPRESSLY WAIVES FOREVER
TRIAL BY JURY.


 


                              [SIGNATURE
PAGES FOLLOW]


 




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


 


MGT
Capital Investments, Inc.,


 


	 	Address
    for Notice:	 
	 	 	 	 
	 	512
    S. Mangum St. Suite 408, Durham, NC 27701	 
	 	 	 	 
	 	By:	Robert
    Ladd	 
	 	 	 	 
	 	Name:	Robert
    Ladd	 
	 	 	 	 
	 	Title:	President
    and Chief Executive Officer	 


 


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


 


[REMAINDER
OF PAGE INTENTIONALLY LEFT BLANK]


 


[SIGNATURE
PAGE FOR PURCHASER FOLLOWS]