Exhibit 10.1





 


 PANACEA
LIFE SCIENCES, INC.


 


SERIES
B PREFERRED SECURITIES PURCHASE AGREEMENT


 


 


 


DECEMBER
3, 2019


 






     


     


    




 


TABLE
OF CONTENTS





Page


 





















	1.	Purchase and Sale of Preferred Stock, Convertible Note and Warrant.	1
	 	1.1	Sale and Issuance of Preferred Stock Convertible Note and Warrant.	1
	 	1.2	Closing; Delivery.	1
	 	1.3	Sale of Milestone Shares of Preferred Stock.	2
	 	1.4	Use of Proceeds	2
	 	1.5	Defined Terms Used in this Agreement	2
	 	 	 	 
	2.	Representations and Warranties of the Company	4
	 	2.1	Organization, Good Standing, Corporate Power and Qualification	5
	 	2.2	Capitalization	5
	 	2.3	Subsidiaries	6
	 	2.4	Authorization	6
	 	2.5	Valid Issuance of Series B Securities	7
	 	2.6	Governmental Consents and Filings	7
	 	2.7	Litigation	7
	 	2.8	and Compliance with Laws	7
	 	2.9	Intellectual Property	8
	 	2.10	Compliance with Other Instruments	9
	 	2.11	Agreements; Actions	9
	 	2.12	Certain Transactions	10
	 	2.13	Rights of Registration and Voting Rights	10
	 	2.14	Property	10
	 	2.15	Financial Statements	10
	 	2.16	Changes	11
	 	2.17	Employee Matters	12
	 	2.18	Tax Returns and Payments	13
	 	2.19	Insurance	13
	 	2.20	Employee Agreements	13
	 	2.21	Permits	14
	 	2.22	Corporate Documents	14
	 	2.23	83(b) Elections	14
	 	2.24	Environmental and Safety Laws	14
	 	2.25	Data Privacy	14
	 	2.26	Preclinical Development and Clinical Trials	15
	 	2.27	FDA Approvals	15
	 	2.28	Purchase Entirely for Own Account	15
	 	2.32	Accredited Investor	17
	 	 	 	 
	3.	Representations and Warranties of the Purchaser	17
	 	3.1	Authorization	18
	 	3.2	Valid Issuance of Purchase Common Stock	18
	 	3.3	Governmental Consents and Filings	18
	 	3.4	Litigation	18
	 	3.5	SEC Documents	18
	 	3.6	Purchaser Financial Statements	19
	 	3.7	Tax Returns and Payments	19














 






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TABLE
OF CONTENTS

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	 	3.8	Purchase Entirely for Own Account	19
	 	3.9	Disclosure of Information	19
	 	3.10	Restricted Securities	19
	 	3.11	No Public Market	20
	 	3.12	Legends	20
	 	3.13	Accredited Investor	20
	 	3.14	No General Solicitation	20
	 	3.15	Residence	20
	 	 	 	 
	4.	Conditions to the Purchaser’s Obligations at Closing	21
	 	4.1	Representations and Warranties	21
	 	4.2	Performance	21
	 	4.3	Compliance Certificate	21
	 	4.4	Qualifications	21
	 	4.5	Board of Directors	21
	 	4.6	Investors’ Rights Agreement	21
	 	4.7	Right of First Refusal and Co-Sale Agreement	21
	 	4.8	Voting Agreement	21
	 	4.9	Letter Agreement	21
	 	4.10	Restated Certificate	22
	 	4.11	Secretary’s Certificate	22
	 	4.12	Proceedings and Documents	22
	 	4.13	Preemptive Rights	22
	 	 	 	 
	5.	Conditions of the Company’s Obligations at Closing	22
	 	5.1	Representations and Warranties	22
	 	5.2	Performance	22
	 	5.3	Qualifications	22
	 	5.4	Investors’ Rights Agreement	22
	 	5.5	Right of First Refusal and Co-Sale Agreement	23
	 	5.6	Voting Agreement	23
	 	5.7	Letter Agreement	23
	 	5.8	Secretary’s Certificate	23
	 	5.9	Compliance Certificate	23
	 	 	 	 
	6.	Miscellaneous	23
	 	6.1	Survival of Warranties	23
	 	6.2	Successors and Assigns	23
	 	6.3	Governing Law	23
	 	6.4	Counterparts	23
	 	6.5	Titles and Subtitles	23
	 	6.6	Notices	23
	 	6.7	No Finder’s Fees	24
	 	6.8	Fees and Expenses	24
	 	6.9	Attorneys’ Fees	24
	 	6.10	Amendments and Waivers	24
	 	6.11	Severability	24
	 	6.12	Delays or Omissions	24




  






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TABLE
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	 	6.13	Entire Agreement	25
	 	6.14	Termination of Closing Obligations	25
	 	6.15	Dispute Resolution	25










 





	Exhibit A -	FORM OF SECOND AMENDED AND RESTATED ARTICLES OF INCORPORATION
	 	 
	Exhibit B - 	FORM OF NOTE
	 	 
	Exhibit C - 	FORM OF WARRANT
	 	 
	Exhibit D -	COMPANY DISCLOSURE SCHEDULE
	 	 
	Exhibit E - 	PURCHASER DISCLOSURE SCHEDULE
	 	 
	Exhibit F -	FORM OF INVESTORS’ RIGHTS AGREEMENT
	 	 
	Exhibit G -	Form of Right of First Refusal and Co-Sale Agreement
	 	 
	Exhibit H -	FORM OF VOTING AGREEMENT
	 	 
	Exhibit I - 	FORM OF LETTER AGREEMENT
	 	 
	Exhibit J - 	FORM OF SECURITY AGREEMENT












 






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SERIES
B PREFERRED SECURITIES PURCHASE AGREEMENT


 


THIS
SERIES B PREFERRED SECURITIES PURCHASE AGREEMENT (this “Agreement”), is made as of December 3, 2019 by and among
Panacea Life Sciences, Inc., a Colorado corporation (the “Company”), and 22nd Century Group, Inc.,
a Nevada corporation (the “Purchaser”).


 


The
parties hereby agree as follows:


 


1. 
Purchase and Sale of Preferred Stock, Convertible Note and Warrant.


 


1.1 
Sale and Issuance of Preferred Stock Convertible Note and Warrant.


 


(a) 
The Company shall adopt and file with the Secretary of State of the State of Colorado on or before the Initial Closing (as
defined below) the Second Amended and Restated Articles of Incorporation in the form of Exhibit A attached to this Agreement
(the “Restated Certificate”).


 


(b) 
Subject to the terms and conditions of this Agreement, the Purchaser agrees to purchase at the Initial Closing and the Company
agrees to sell and issue to the Purchaser at the Initial Closing 3,733,334 shares (the “Initial Shares”) of
Series B Preferred Stock, $0.01 par value per share (the “Series B Preferred Stock”), at a purchase price of
$1.875 per share (the “Series B Original Issue Price”). The shares of Series B Preferred Stock issued to the
Purchaser pursuant to this Agreement (including the Initial Shares, the Milestone Shares (as defined below), the Warrant Shares
(as defined below) and the Conversion Shares, (as defined below) shall be referred to in this Agreement as the “Shares.”


 


(c) 
Subject to the terms and conditions of this Agreement, the Purchaser agrees to purchase at the Initial Closing and the Company
agrees to sell and issue to the Purchaser, a secured convertible promissory note in the form of Exhibit B hereto (the “Note”)
in the principal amount of $7,000,000, which Note is convertible into 3,733,334 shares of Series B Preferred Stock, subject to
adjustment as provided in the Note (the “Conversion Shares”).


 


(d) 
The Company shall issue to the Purchaser a warrant, in substantially the form of Exhibit C, (a “Series B
Warrant”), for the purchase of shares (the “Warrant Shares”) of Series B Preferred Stock which
shall be exercisable at a price per share equal to $2.344, subject to adjustment as provided in the Series B Warrant.


 


1.2 
Closing; Delivery.


 


(a) 
The initial purchase and sale of the Initial Shares, the Series B Warrant and the Notes shall take place remotely via the
exchange of documents and signatures on the date hereof, or at such other time and place as the Company and the Purchaser mutually
agree upon, orally or in writing (which time and place are designated as the “Initial Closing”).


 






     


     


    

 


(b) 
At the Initial Closing, the Company shall deliver to the Purchaser a certificate representing the Initial Shares, the Note
and the Series B Warrant against payment of the purchase price therefor as follows: (i) $12 million by wire transfer to a bank
account designated by the Company, and (ii) the issuance by the Purchaser of a number of shares of Purchaser’s common stock,
$0.00001 par value per share (the “Purchaser Common Stock”) equal to the quotient of $2,000,000 divided by
the 30-day VWAP ending on the date of the Initial Closing; provided that the 30-day VWAP shall not be less than $1.00.


 


1.3 
Sale of Milestone Shares of Preferred Stock.


 


(a) 
After the Initial Closing, the Company shall sell, and the Purchaser shall purchase, on the same terms and conditions as
those contained in this Agreement, 5,333,334 additional shares of Series B Preferred Stock (the “Milestone Shares”)
at the Series B Original Issue Price per share, upon the certification by the Board (including the director appointed by the Purchaser)
that the Company has achieved at least an aggregate of $20,000,000 in gross revenues (calculated in accordance with GAAP (as defined
below)) for any twelve (12) consecutive month period following the Initial Closing (the “Milestone Event”).
The date of the purchase and sale of the Milestone Shares are referred to in this Agreement as the “Milestone Closing”
which such closing shall occur upon, or a reasonable time after, the Milestone Event.


 


(b) 
At the Milestone Closing, the Company shall deliver to the Purchaser a certificate representing the Milestone Shares against
payment of the purchase price therefor as follows: (i) $8,500,000 by wire transfer to a bank account designated by the Company,
and (ii) the issuance by the Purchaser of a number of shares of Purchaser Common Stock equal to the quotient of $1,500,000 divided
by the 30-day VWAP ending on the date of the Milestone Closing; provided that the 30-day VWAP shall not be less than $1.00.


 


1.4 
Use of Proceeds. In accordance with the directions of the Board of Directors of the Company (the “Board”),
as it shall be constituted in accordance with the Voting Agreement, the Company will use the proceeds from the sale of the Initial
Shares, the Milestone Shares, the Note and the Conversion Shares for (i) the repayment of up to $5,000,000 in aggregate principal
amount of indebtedness of the Company held by Quintel and (ii) product development, limited research studies as mutually agreed
between the parties, sales and marketing investments, capital investments, working capital and other general corporate purposes,
but excluding distributions to stockholders, repurchases of securities (except as in (ii) above) and acquisitions.


 


1.5 
Defined Terms Used in this Agreement. In addition to the terms defined above, the following terms used in this Agreement
shall be construed to have the meanings set forth or referenced below.


 


(a) 
“30-day VWAP” means, as of any date, the volume weighted average price per share of the Purchaser Common
Stock on the Principal Trading Market (as reported by Bloomberg L.P. (or its successor) or, if not available, by another authoritative
source mutually agreed by the Company and the Purchaser) from 9:30 a.m. (New York City time) on the Trading Day that is thirty
(30) Trading Days preceding such date to 4:00 p.m. (New York City time) on the last Trading Day immediately preceding such date.


 


(b) 
“Affiliate” means, with respect to any specified Person, any other Person who, directly or indirectly,
controls, is controlled by, or is under common control with such Person, including, without limitation, any general partner, managing
member, officer, director or trustee of such Person, or any venture capital fund or registered investment company now or hereafter
existing that is controlled by one or more general partners, managing members or investment advisers of, or shares the same management
company or investment adviser with, such Person.


  






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(c) 
“Closing” means either the Initial Closing or the Milestone Closing, as applicable.


 


(d) 
“Code” means the Internal Revenue Code of 1986, as amended.


 


(e)  “Company Intellectual Property” means all patents, patent applications, registered and unregistered
trademarks, trademark applications, registered and unregistered service marks, service mark applications, tradenames, copyrights,
trade secrets, domain names, information and proprietary rights and processes, similar or other intellectual property rights, subject
matter of any of the foregoing, tangible embodiments of any of the foregoing, licenses in, to and under any of the foregoing, and
any and all such cases that are owned or used by the Company in the conduct of the Company’s business as now conducted and
as presently proposed to be conducted.


 


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


 


(g) 
“Investors’ Rights Agreement” means the agreement among the Company and the Purchaser and certain
other stockholders of the Company dated as of the date of the Initial Closing, in the form of Exhibit F attached to this
Agreement.


 


(h) 
“Key Employee” means (i) Leslie Buttorff, (ii) Jordan D. Buttorff, (iii) Nick S. Buttorff, (iv) Nick
J. Cavarra and (v) James Baumgartner.


 


(i) 
“Knowledge” with respect to the Company, including the phrase “to the Company’s knowledge”
shall mean the actual and constructive knowledge of the Key Employees, and “Knowledge” with respect to the Purchaser,
including the phrase “to the Purchaser’s knowledge” shall mean the actual and constructive knowledge of
the executive officers of the Purchaser.


 


(j) 
“Letter Agreement” means the agreement, among the Company, the Key Employees, Quintel and the Purchaser,
in the form of Exhibit I attached to this Agreement.


 


(k) “Material
Adverse Effect” with respect to the Company, means a material adverse effect on the business, assets (including intangible
assets), liabilities, financial condition, property, or results of operations of the Company, and with respect to the Purchaser,
means a material adverse effect on the business, assets (including intangible assets), liabilities, financial condition, property,
or results of operations of the Purchaser.


 


(l) 
“Person” means any individual, corporation, partnership, trust, limited liability company, association
or other entity.


 


(m) 
“Preferred Stock” means the Company’s Series A Preferred Stock and Series B Preferred Stock.


 


(n) “Principal
Trading Market” means the trading market on which the Purchaser Common Stock is primarily listed on and quoted for trading,
and which, as of the Issue Date is the NYSE American.


 


(o) 
“Quintel” means Quintel-MC, Incorporated, a Colorado corporation.


 






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(p) 
“Right of First Refusal and Co-Sale Agreement” means the agreement among the Company, the Purchaser,
and certain other stockholders of the Company, dated as of the date of the Initial Closing, in the form of Exhibit G attached
to this Agreement.


 


(q) 
“SEC” means the United States Securities and Exchange Commission.


 


(r) 
“SEC Documents” means all forms, proxy statements, registration statements, reports, schedules, and other
documents filed, or required to be filed, by the Purchaser with the SEC pursuant to the Securities Laws.


 


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


 


(t) 
“Securities Laws” means the Securities Act and the Exchange Act and the rules and regulations promulgated
thereunder.


 


(u) 
“Security Agreement” means the agreement among the Company and the Purchaser, dated as of the date of
the Initial Closing and securing the obligations under the Notes in the form of Exhibit J attached to this Agreement.


 


(v) 
“Series A Preferred Stock” means the Company’s Series A Preferred Stock, $0.01 par value per share.


 


(w) 
“Series B Securities” means the Initial Shares, Milestone Shares, Notes, Conversion Shares, Series B
Warrants and Warrant Shares.


 


(x) 
“Shares” means the shares of Series B Preferred Stock issued at the Initial Closing, any Milestone Shares
issued at a Milestone Closing under Subsection 1.2(b), the Conversion Shares and the Warrant Shares.


 


(y) 
“Trading Day” means a day on which the Principal Trading Market is open for trading.


 


(z) 
“Transaction Agreements” means this Agreement, the Note, the Series B Warrant, the Security Agreement,
the Investors’ Rights Agreement, the Right of First Refusal and Co-Sale Agreement, Voting Agreement, the Letter Agreement
and any other agreements, instruments or documents entered into in connection with this Agreement.


 


(aa) 
“Voting Agreement” means the agreement among the Company, the Purchaser and certain other stockholders
of the Company, dated as of the date of the Initial Closing, in the form of Exhibit H attached to this Agreement.


 


2. 
Representations and Warranties of the Company. The Company hereby represents and warrants to the Purchaser
that, except as set forth on the Disclosure Schedule attached as Exhibit D to this Agreement, which exceptions shall be
deemed to be part of the representations and warranties made hereunder, the following representations are true and complete as
of the date of the Initial Closing, except as otherwise indicated. The Disclosure Schedule shall be arranged in sections corresponding
to the numbered and lettered sections and subsections contained in this Section 2, and the disclosures in any section or
subsection of the Disclosure Schedule shall qualify other sections and subsections in this Section 2 only to the extent
it is readily apparent from a reading of the disclosure that such disclosure is applicable to such other sections and subsections.3


 





 



 


3
NTD: All reps and warranties subject to further diligence review.


 




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For
purposes of these representations and warranties (other than those in Subsections 2.2, 2.3, 2.4, 2.5,
and 2.6), the term the “Company” shall include any subsidiaries of the Company, unless otherwise noted
herein.


 


2.1 
Organization, Good Standing, Corporate Power and Qualification. The Company is a corporation duly organized, validly
existing and in good standing under the laws of the State of Colorado and has all requisite corporate power and authority to carry
on its business as now conducted and as presently proposed to be conducted. The Company is duly qualified to transact business
and is in good standing in each jurisdiction in which the failure to so qualify would have a Material Adverse Effect.


 


2.2 
Capitalization.


 


(a) 
The authorized capital of the Company consists, as of the adoption and filing of the Restated Certificate with the Secretary
of State of the State of Colorado, of:


 


(i) 
(i)33,930,000 shares of common stock, $0.01 par value per share (the “Common Stock”), 18,404,331
shares of which are issued and outstanding immediately prior to the Initial Closing. All of the outstanding shares of Common Stock
have been duly authorized, are fully paid and nonassessable and were issued in compliance with all applicable federal and state
securities laws.


 


(ii) 
14,674,000 shares of Preferred Stock, of which (A) 13,174,000 shares have been designated Series B Preferred Stock,
none of which are issued and outstanding immediately prior to the Initial Closing and (B) 1,500,000 shares have been designated
Series A Preferred Stock, 1,500,000 of which are issued and outstanding immediately prior to the Initial Closing. The rights, privileges
and preferences of the Preferred Stock are as stated in the Restated Certificate and as provided by the Colorado Business Corporation
Act.


 


(b) 
The Company has reserved 3,235,000 shares of Common Stock for issuance to officers, directors, employees and consultants
of the Company pursuant to its 2017 Equity Incentive Plan duly adopted by the Board of Directors and approved by the Company stockholders
(the “Stock Plan”). Of such reserved shares of Common Stock, 1,345,000 shares have been issued pursuant to restricted
stock purchase agreements, options to purchase 844,002 shares have been granted and are currently outstanding, and 1,045,998 shares
of Common Stock remain available for issuance to officers, directors, employees and consultants pursuant to the Stock Plan. The
Company has furnished to the Purchaser complete and accurate copies of the Stock Plan and forms of agreements used thereunder.


 


(c) 
Except for (A) the conversion or exercise privileges of the Series B Securities to be issued under this Agreement, (B) the
rights provided in Section 4 of the Investors’ Rights Agreement, and (C) the securities and rights described in Subsections
2.2(a)(ii) and 2.2(b) of this Agreement and Subsection 2.2(b) of the Disclosure Schedule, there are no outstanding options,
warrants, rights (including conversion or preemptive rights and rights of first refusal or similar rights) or agreements, orally
or in writing, to purchase or acquire from the Company any shares of Common Stock or Preferred Stock, or any securities convertible
into or exchangeable for shares of Common Stock or Preferred Stock. All outstanding shares of the Company’s Common Stock
and all shares of the Company’s Common Stock underlying outstanding options are subject to (i) a right of first refusal in
favor of the Company upon any proposed transfer (other than transfers for estate planning purposes); and (ii) a lock-up or market
standoff agreement of not less than one hundred eighty (180) days following the Company’s initial public offering pursuant
to a registration statement filed with the Securities and Exchange Commission under the Securities Act. No person or entity (x)
has been granted full ratchet, formula adjustment, or any other type of, protection against dilution of their ownership interest
in the Company, (y) has been granted rights to receive the same or better rights in connection with any ownership interest in the
Company as any other person or entity may receive either pursuant to this Agreement or at any time hereafter or (z) have been granted
rights of redemption by the Company. No full ratchet, formula adjustment, or any other type of, protection against dilution of
any ownership interest in the Company has been triggered, nor will be triggered by the transactions provided for in this Agreement.


 






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(d) 
None of the Company’s restricted stock award agreements under the Stock Plan contains a provision for acceleration
of vesting (or lapse of a repurchase right) or other changes in the vesting provisions or other terms of such agreement or understanding
upon the occurrence of any event or combination of events, including without limitation in the case where the Company’s Stock
Plan is not assumed in an acquisition. The Company’s stock option agreements under the Stock Plan contain “double-trigger”
vesting acceleration upon the occurrence of both (i) a change of control of the Company and (ii) a termination of employment without
cause within 12 months of a change of control. The Company has never adjusted or amended the exercise price of any stock options
previously awarded, whether through amendment, cancellation, replacement grant, repricing, or any other means. Except as set forth
in the Restated Certificate, the Company has no obligation (contingent or otherwise) to purchase or redeem any of its capital stock.


 


(e) 
409A. The Company believes in good faith that any “nonqualified deferred compensation plan” (as
such term is defined under Section 409A(d)(1) of the Code and the guidance thereunder) under which the Company makes, is obligated
to make or promises to make, payments (each, a “409A Plan”) complies in all
material respects, in both form and operation, with the requirements of Section 409A of the Code and the guidance thereunder. To
the knowledge of the Company, no payment to be made under any 409A Plan is, or will be, subject to the penalties of Section 409A(a)(1)
of the Code.


 


(f) 
The Company has obtained valid waivers of any rights by other parties to purchase any of the Series B Securities covered
by this Agreement.


 


2.3 
Subsidiaries. The Company does not currently own or control, directly or indirectly, any interest in any other corporation,
partnership, trust, joint venture, limited liability company, association, or other business entity. The Company is not a participant
in any joint venture, partnership or similar arrangement.


 


2.4 
Authorization. All corporate action required to be taken by the Board and stockholders in order to authorize the
Company to enter into the Transaction Agreements, and to issue the Series B Securities at the Initial Closing and the Milestone
Closing and the Preferred Stock or Common Stock issuable upon conversion or exercise of the Series B Securities, has been taken
or will be taken prior to the Initial Closing. All action on the part of the officers of the Company necessary for the execution
and delivery of the Transaction Agreements, the performance of all obligations of the Company under the Transaction Agreements
to be performed as of the Initial Closing and/or the Milestone Closing, and the issuance and delivery of the Series B Securities
has been taken or will be taken prior to the Initial Closing. The Transaction Agreements, when executed and delivered by the Company,
shall constitute valid and legally binding obligations of the Company, enforceable against the Company in accordance with their
respective terms except (i) as limited by applicable bankruptcy, insolvency, reorganization, moratorium, fraudulent conveyance,
or other laws of general application relating to or affecting the enforcement of creditors’ rights generally, (ii) as limited
by laws relating to the availability of specific performance, injunctive relief, or other equitable remedies, or (iii) to
the extent the indemnification provisions contained in the Investors’ Rights Agreement may be limited by applicable federal
or state securities laws.


 






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2.5 
Valid Issuance of Series B Securities. (i) The Initial Shares and the Milestone Shares,
when issued, sold and delivered in accordance with the terms and for the consideration set forth in this Agreement, (ii) the Warrant
Shares, when issued upon exercise of the Series B Warrant in accordance with its terms, (iii) the Conversion Shares, when issued
upon conversion of the Note in accordance with its terms, and (iv) the Common Stock, when issued upon conversion of the Initial
Shares, the Milestone Shares, the Warrant Shares and the Conversion Shares in accordance with the Restated Certificate, will be
validly issued, fully paid and nonassessable and free of restrictions on transfer other than restrictions on transfer under the
Transaction Agreements, applicable state and federal securities laws and liens or encumbrances created by or imposed by the Purchaser.
Assuming the accuracy of the representations of the Purchaser in Section 3 of this Agreement and subject to the filings
described in the Voting Agreement, the Series B Securities will be issued in compliance with all applicable federal and state securities
laws. The Preferred Stock or Common Stock issuable upon conversion or exercise of the Note, Warrant, Initial Shares, Conversion
Shares and Milestone Shares has been duly reserved for issuance, and upon issuance in accordance with the terms of the Restated
Certificate, will be validly issued, fully paid and nonassessable and free of restrictions on transfer other than restrictions
on transfer under the Transaction Agreements, applicable federal and state securities laws and liens or encumbrances created by
or imposed by the Purchaser. Based in part upon the representations of the Purchaser in Section 3 of this Agreement and
in the Voting Agreement, the Common Stock issuable upon the conversion or exercise of the Series B Securities will be issued in
compliance with all applicable federal and state securities laws. No “bad actor” disqualifying event described in Rule
506(d)(1)(i)-(viii) of the Securities Act is applicable to the Company or, to the Company’s knowledge, any person affiliated
with the Company.


 


2.6 
Governmental Consents and Filings. Assuming the accuracy of the representations made by the Purchaser in Section 3
of this Agreement, no consent, approval, order or authorization of, or registration, qualification, designation, declaration or
filing with, any federal, state or local governmental authority is required on the part of the Company in connection with the consummation
of the transactions contemplated by this Agreement, except for (i) the filing of the Restated Certificate, which will have been
filed as of the Initial Closing, and (ii) filings pursuant to Regulation D of the Securities Act, and applicable state securities
laws, which have been made or will be made in a timely manner.


 


2.7 
Litigation and Compliance with Laws. To the Company’s knowledge and to the Knowledge of the Key Employees,
neither the Company nor any of its Affiliates is or in the past three (3) years has been in material violation of, or has been
charged with any violation of, any applicable law (excluding traffic violations and other minor offenses). There is no claim,
action, suit, proceeding, arbitration, complaint, charge or investigation pending or, to the Company’s knowledge, currently
threatened (i) against the Company or any officer, director or Key Employee of the Company; (ii) that questions the validity of
the Transaction Agreements or the right of the Company to enter into them, or to consummate the transactions contemplated by the
Transaction Agreements; or (iii) that would reasonably be expected to have, either individually or in the aggregate, a Material
Adverse Effect, nor does the Company have any knowledge of any basis for the foregoing. Neither the Company nor, to the Company’s
knowledge, any of its officers, directors or Key Employees is a party or is named as subject to the provisions of any order, writ,
injunction, judgment or decree of any court or government agency or instrumentality (in the case of officers, directors or Key
Employees, such as would affect the Company). There is no action, suit, proceeding or investigation by the Company pending or
which the Company intends to initiate. The foregoing includes, without limitation, actions, suits, proceedings or investigations
pending or threatened (or any basis therefor known to the Company) involving the prior employment of any of the Company’s
employees, their services provided in connection with the Company’s business, any information or techniques allegedly proprietary
to any of their former employers or their obligations under any agreements with prior employers.


 






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2.9 
Intellectual Property. The Company owns or possesses or, to the Company’s knowledge, believes it can acquire
on commercially reasonable terms sufficient legal rights to all Company Intellectual Property without any conflict with, or infringement
of, the rights of others, including prior employees or consultants with which any of them may be affiliated now or may have been
affiliated in the past. To the Company’s knowledge with respect to third-party patents, trademarks, service marks and tradenames
only, no product or service marketed or sold (or proposed to be marketed or sold) by the Company violates or will violate any license
or infringes or will infringe any intellectual property rights of any other party. Other than with respect to commercially available
software products under standard, non-negotiated, non-exclusive end-user object code license agreements that are not incorporated
into, or used in, the Company’s products or services, there are no outstanding options, licenses, agreements, claims, encumbrances
or shared ownership interests of any kind relating to the Company Intellectual Property, nor is the Company bound by or a party
to any options, licenses or agreements of any kind with respect to the patents, trademarks, service marks, trade names, domain
names, copyrights, trade secrets, licenses, information, proprietary rights and processes of any other Person. The Company has
not received any communications alleging that the Company has violated, or by conducting its business, would violate any of the
patents, trademarks, service marks, tradenames, domain names, copyrights, trade secrets, mask works or other proprietary rights
or processes of any other Person, and the Company is not aware of any potential basis for such an allegation or of any reason to
believe that such an allegation may be forthcoming. The Company has obtained and possesses valid licenses to use all of the software
programs present on the computers and other software-enabled electronic devices that it owns or leases or that it has otherwise
provided to its employees for their use in connection with the Company’s business. To the Company’s knowledge, it will
not be necessary to use any inventions of any of its employees or consultants (or Persons it currently intends to hire) made prior
to, or outside the scope of, their employment by or consulting relationship with the Company, including prior employees or consultants
with which any of them may be affiliated now or may have been affiliated in the past. Each current employee and consultant has
assigned to the Company all intellectual property rights he or she owns that are related to the Company’s business as now
conducted and as presently proposed to be conducted and all intellectual property rights that he, she or it solely or jointly conceived,
reduced to practice, developed or made during the period of his, her or its employment or consulting relationship with the Company
that (a) relate, at the time of conception, reduction to practice, development, or making of such intellectual property right,
to the Company’s business as then conducted or as then proposed to be conducted, (b) were developed on any amount of the
Company’s time or with the use of any of the Company’s equipment, supplies, facilities or information or (c) resulted
from the performance of services for the Company. Subsection 9 of the Disclosure Schedule lists all patents, patent applications,
registered trademarks, trademark applications, service marks, service mark applications, tradenames, registered copyrights, and
licenses to and under any of the foregoing, in each case owned by the Company. For purposes of this Subsection 2.9,
the Company shall be deemed to have knowledge of a patent right if the Company has actual knowledge of the patent right or would
be found to be on notice of such patent right as determined by reference to United States patent laws. To the extent the Company
uses any “open source” or “copyleft” software in its products or services or is a party to “open”
or “public source” or similar licenses with respect to all or any part of its products or services (each, an “Open
Source License”), the Company is in compliance with the terms of any such licenses, any such software and Open Source Licenses
are listed on the Disclosure Schedule, and the Company is not required (and, even if it distributed its software, would not be
required) under any such Open Source License to (a) make or permit any disclosure or to make available any source code for its
(or any of its licensors’) proprietary software or (b) distribute or make available any of the Company’s proprietary
software or intellectual property (or to permit any such distribution or availability). No government funding, facilities of a
university, college, other educational institution or research center, or funding from third parties was used in the development
of any Company Intellectual Property. No Person who was involved in, or who contributed to, the creation or development of any
Company Intellectual Property, has performed services for the government, university, college, or other educational institution
or research center in a manner that would affect Company’s rights in the Company Intellectual Property.


 






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2.10 
Compliance with Other Instruments. The Company is not in violation or default of any provisions of its Restated Certificate
or Bylaws. The Company is not in material violation or default (i) of any instrument, judgment, order, writ or decree, (ii) under
any note, indenture or mortgage, or (iii) under any lease, agreement, privacy policy, contract or purchase order to which it is
a party or by which it is bound, or (iv) to its knowledge, of any provision of federal or state statute, rule or regulation applicable
to the Company (including, without limitation, those related to food services, privacy, personally identifiable information or
export control). The execution, delivery and performance of the Transaction Agreements and the consummation of the transactions
contemplated by the Transaction Agreements will not result in any such violation or be in conflict with or constitute, with or
without the passage of time and giving of notice, either (X) a default under any such provision, instrument, judgment, order, writ,
decree, contract or agreement; or (Y) an event which results in the creation of any lien, charge or encumbrance upon any assets
of the Company or the suspension, revocation, forfeiture, or nonrenewal of any material permit or license applicable to the Company.


 


2.11 
Agreements; Actions.


 


(a) 
Except for the Transaction Agreements, there are no agreements, understandings, instruments, contracts or proposed transactions
to which the Company is a party or by which it is bound that involve (i) obligations (contingent or otherwise) of, or payments
to, the Company in excess of $25,000, (ii) the license or transfer of or other agreements regarding any patent, copyright,
trademark, trade secret or other proprietary right to or from the Company, (iii) the grant of rights to manufacture, produce,
assemble, license, market, or sell its products or services to any other Person that limits the Company’s exclusive right
to develop, manufacture, assemble, distribute, market or sell its products, or (iv) indemnification by the Company with respect
to infringements of proprietary rights. Collectively, all of the foregoing are “Material Contracts.” All Material Contracts
are valid, binding and enforceable against the Company and, to the Company’s knowledge, against the other parties thereto
in accordance with their respective terms, except (i) as limited by applicable bankruptcy, insolvency, reorganization, moratorium,
fraudulent conveyance, or other laws of general application relating to or affecting the enforcement of creditors’ rights
generally, (ii) as limited by laws relating to the availability of specific performance, injunctive relief, or other equitable
remedies. The Company is not in default under any Material Contract.


 


(b) 
The Company has not (i) declared or paid any dividends, or authorized or made any distribution upon or with respect
to any class or series of its capital stock, (ii) incurred any indebtedness for money borrowed or incurred any other liabilities
individually in excess of $100,000 or in excess of $200,000 in the aggregate, (iii) made any loans or advances to any Person,
other than ordinary advances for travel expenses, or (iv) sold, exchanged or otherwise disposed of any of its assets or rights,
other than the sale of its inventory in the ordinary course of business. For the purposes of (a) and (b) of this Subsection 2.11,
all indebtedness, liabilities, agreements, understandings, instruments, contracts and proposed transactions involving the same
Person (including Persons the Company has reason to believe are affiliated with each other) shall be aggregated for the purpose
of meeting the individual minimum dollar amounts of such subsection.


 


(c) 
The Company is not a guarantor or indemnitor of any indebtedness of any other Person.


 


2.12 
Certain Transactions.


 


(a) 
Other than (i) standard employee benefits generally made available to all employees, (ii) standard director and officer
indemnification agreements approved by the Board of Directors, and (iii) the purchase of shares of the Company’s capital
stock and the issuance of options to purchase shares of the Company’s Common Stock, in each instance, approved in the written
minutes of the Board of Directors (previously provided to the Purchaser or their counsel), there are no agreements, understandings
or proposed transactions between the Company and any of its officers, directors, consultants or Key Employees, or any Affiliate
thereof.


 






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(b) 
The Company is not indebted, directly or indirectly, to any of its directors, officers or employees or to their respective
spouses or children or to any Affiliate of any of the foregoing, other than in connection with expenses or advances of expenses
incurred in the ordinary course of business or employee relocation expenses and for other customary employee benefits made generally
available to all employees. None of the Company’s directors, officers or employees, or any members of their immediate families,
or any Affiliate of the foregoing are, directly or indirectly, indebted to the Company or, to the Company’s knowledge, have
any (i) material commercial, industrial, banking, consulting, legal, accounting, charitable or familial relationship with any of
the Company’s customers, suppliers, service providers, joint venture partners, licensees and competitors, (ii) direct or
indirect ownership interest in any firm or corporation with which the Company is affiliated or with which the Company has a business
relationship, or any firm or corporation which competes with the Company except that directors, officers, employees or stockholders
of the Company may own stock in (but not exceeding two percent (2%) of the outstanding capital stock of) publicly traded companies
that may compete with the Company; or (iii) financial interest in any contract with the Company, other than pursuant to employment
agreements and awards under the Stock Plan.


 


2.13 
Rights of Registration and Voting Rights. Except as provided in the Investors’ Rights Agreement, the Company
is not under any obligation to register under the Securities Act any of its currently outstanding securities or any securities
issuable upon exercise or conversion of its currently outstanding securities. To the Company’s knowledge, except as contemplated
in the Voting Agreement, no stockholder of the Company has entered into any agreements with respect to the voting of capital shares
of the Company.


 


2.14 
Property. The property and assets that the Company owns are free and clear of all mortgages, deeds of trust, liens,
loans and encumbrances, except for statutory liens for the payment of current taxes that are not yet delinquent and encumbrances
and liens that arise in the ordinary course of business and do not materially impair the Company’s ownership or use
of such property or assets. With respect to the property and assets it leases, the Company is in compliance with such leases and
holds a valid leasehold interest free of any liens, claims or encumbrances other than those of the lessors of such property or
assets. The Company does not own any real property.


 


2.15 
Financial Statements. . The Company has delivered to the Purchaser its unaudited financial statements (including
balance sheet and income statement) as of December 31, 2018 and for the fiscal year ended December 31, 2018 and its unaudited financial
statements (including balance sheet and income statement) as of October 31, 2019 and for the interim period ended October 31, 2019
(collectively, the “Financial Statements”). The Financial Statements have been prepared in accordance with generally
accepted accounting principles (“GAAP”) applied on a consistent basis throughout the periods indicated, except
that the unaudited Financial Statements may not contain all footnotes required by GAAP. The Financial Statements fairly present
in all material respects the financial condition and operating results of the Company as of the dates, and for the periods, indicated
therein, subject in the case of the unaudited Financial Statements to normal year-end audit adjustments. Except as set forth in
the Financial Statements, the Company has no material liabilities or obligations, contingent or otherwise, other than (i) liabilities
incurred in the ordinary course of business subsequent to September 30, 2019; (ii) obligations under contracts and commitments
incurred in the ordinary course of business; and (iii) liabilities and obligations of a type or nature not required under GAAP
to be reflected in the Financial Statements, which, in all such cases, individually and in the aggregate would not have a Material
Adverse Effect. The Company maintains and will continue to maintain a standard system of accounting established and administered
in accordance with GAAP.


 






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2.16 
Changes. Since October 31, 2019 there has not been:


 


(a) 
any change in the assets, liabilities, financial condition or operating results of the Company from that reflected in the
Financial Statements, except changes in the ordinary course of business that have not caused, in the aggregate, a Material Adverse
Effect;


 


(b) 
any damage, destruction or loss, whether or not covered by insurance, that would have a Material Adverse Effect;


 


(c) 
any waiver or compromise by the Company of a valuable right or of a material debt owed to it;


 


(d) 
any satisfaction or discharge of any lien, claim, or encumbrance or payment of any obligation by the Company, except in
the ordinary course of business and the satisfaction or discharge of which would not have a Material Adverse Effect;


 


(e) 
any material change to a material contract or agreement by which the Company or any of its assets is bound or subject;


 


(f) 
any material change in any compensation arrangement or agreement with any employee, officer, director or stockholder;


 


(g) 
any resignation or termination of employment of any officer or Key Employee of the Company;


 


(h) 
any mortgage, pledge, transfer of a security interest in, or lien, created by the Company, with respect to any of its material
properties or assets, except liens for taxes not yet due or payable and liens that arise in the ordinary course of business and
do not materially impair the Company’s ownership or use of such property or assets;


 


(i) 
any loans or guarantees made by the Company to or for the benefit of its employees, officers or directors, or any members
of their immediate families, other than travel advances and other advances made in the ordinary course of its business;


 


(j) 
any declaration, setting aside or payment or other distribution in respect of any of the Company’s capital stock,
or any direct or indirect redemption, purchase, or other acquisition of any of such stock by the Company;


 


(k) 
any sale, assignment or transfer of any Company Intellectual Property that could reasonably be expected to result in a Material
Adverse Effect;


 


(l) 
receipt of notice that there has been a loss of, or material order cancellation by, any major customer of the Company;


 






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(m) 
to the Company’s knowledge, any other event or condition of any character, other than events affecting the economy
or the Company’s industry generally, that could reasonably be expected to result in a Material Adverse Effect; or


 


(n) 
any arrangement or commitment by the Company to do any of the things described in this Subsection 2.16.


 


2.17 
Employee Matters.


 


(a) 
As of the date hereof, the Company employs 20 full-time employees and 4 part-time employees and engages 13 consultants or
independent contractors. Section 2.17(a) of the Disclosure Schedule sets forth a detailed description of all compensation,
including salary, bonus, severance obligations and deferred compensation paid or payable for each officer, employee, consultant
and independent contractor of the Company who received compensation in excess of $75,000 for the fiscal year ended December 31,
2018 or is anticipated to receive compensation in excess of $75,000 for the fiscal year ending December 31, 2019.


 


(b) 
To the Company’s knowledge, none of its employees is obligated under any contract (including licenses, covenants or
commitments of any nature) or other agreement, or subject to any judgment, decree or order of any court or administrative agency,
that would materially interfere with such employee’s ability to promote the interest of the Company or that would conflict
with the Company’s business as presently conducted or as presently proposed to be conducted. Neither the execution or delivery
of the Transaction Agreements, nor the carrying on of the Company’s business by the employees of the Company, nor the conduct
of the Company’s business as now conducted and as presently proposed to be conducted, will, to the Company’s knowledge,
conflict with or result in a breach of the terms, conditions, or provisions of, or constitute a default under, any contract, covenant
or instrument under which any such employee is now obligated.


 


(c) 
The Company is not delinquent in payments to any of its employees, consultants, or independent contractors for any wages,
salaries, commissions, bonuses, or other direct compensation for any service performed for it to the date hereof or amounts required
to be reimbursed to such employees, consultants or independent contractors. The Company has complied in all material respects with
all applicable state and federal equal employment opportunity laws and with other laws related to employment, including those related
to wages, hours, worker classification and collective bargaining. The Company has withheld and paid to the appropriate governmental
entity or is holding for payment not yet due to such governmental entity all amounts required to be withheld from employees of
the Company and is not liable for any arrears of wages, taxes, penalties or other sums for failure to comply with any of the foregoing.


 


(d) 
To the Company’s knowledge, no Key Employee intends to terminate employment with the Company or is otherwise likely
to become unavailable to continue as a Key Employee. The Company does not have a present intention to terminate the employment
of any of the foregoing. The employment of each employee of the Company is terminable at the will of the Company. Except as set
forth in Subsection 2.16(d) of the Disclosure Schedule or as required by law, upon termination of the employment of any such
employees, no severance or other payments will become due. Except as set forth in Subsection 2.16(d) of the Disclosure Schedule,
the Company has no policy, practice, plan or program of paying severance pay or any form of severance compensation in connection
with the termination of employment services.


 






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(e) 
The Company has not made any representations regarding equity incentives to any officer, employee, director or consultant
that are inconsistent with the share amounts and terms set forth in the minutes of meetings of the Board.


 


(f) 
Subsection 2.17(f) of the Disclosure Schedule sets forth each employee benefit plan maintained, established or sponsored
by the Company, or which the Company participates in or contributes to, which is subject to the Employee Retirement Income Security
Act of 1974, as amended (“ERISA”). The Company has made all required contributions and has no liability to any
such employee benefit plan, other than liability for health plan continuation coverage described in Part 6 of Title I(B) of ERISA,
and has complied in all material respects with all applicable laws for any such employee benefit plan.


 


(g) 
To the Company’s Knowledge, none of the Key Employees or directors of the Company has been (a) convicted in a criminal
proceeding or named as a subject of a pending criminal proceeding (excluding traffic violations and other minor offenses); (b)
subject to any order, judgment or decree (not subsequently reversed, suspended, or vacated) of any court of competent jurisdiction
permanently or temporarily enjoining him or her from engaging, or otherwise imposing limits or conditions on his or her engagement
in any securities, investment advisory, banking, insurance, or other type of business or acting as an officer or director of a
public company; or (c) found by a court of competent jurisdiction in a civil action or by the Securities and Exchange Commission
or the Commodity Futures Trading Commission to have violated any federal or state securities, commodities, or unfair trade practices
Law, which such judgment or finding has not been subsequently reversed, suspended, or vacated.


 


2.18 
Tax Returns and Payments. There are no federal, state, county, local or foreign taxes due and payable by the Company
which have not been timely paid. There are no accrued and unpaid federal, state, country, local or foreign taxes of the Company
which are due, whether or not assessed or disputed. There have been no examinations or audits of any tax returns or reports by
any applicable federal, state, local or foreign governmental agency. The Company has duly and timely filed all federal, state,
county, local and foreign tax returns required to have been filed by it and there are in effect no waivers of applicable statutes
of limitations with respect to taxes for any year.


 


2.19 
Insurance. The Company has in full force and effect insurance policies concerning such casualties as would be reasonable
and customary for companies like the Company. with extended coverage, sufficient in amount (subject to reasonable deductions) to
allow it to replace any of its properties that might be damaged or destroyed.


 


2.20 
Employee Agreements. Each current and former employee, consultant and officer of the Company has executed an agreement
with the Company regarding confidentiality and proprietary information in the form or forms delivered to the counsel for the Purchaser
(the “Confidential Information Agreements”). No current employee, consultant or officer has excluded works or
inventions or other subject matter from his or her assignment of inventions pursuant to such person’s Confidential Information
Agreement. Each current employee has executed a non-competition and non-solicitation agreement substantially in the form or forms
delivered to the counsel for the Purchaser. The Company is not aware that any of its employees, consultants or officers is in violation
of any agreement covered by this Subsection 2.20, and the Company will use its commercially reasonable efforts to prevent
any such violation.


 


2.21 
Permits. The Company has all franchises, permits, licenses and any similar authority necessary for the conduct of
its business, the lack of which could reasonably be expected to have a Material Adverse Effect. The Company is not in default in
any material respect under any of such franchises, permits, licenses or other similar authority.


 






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2.22 
Corporate Documents. The Restated Certificate and Bylaws of the Company are in the form provided to the Purchaser.
The copy of the minute books of the Company provided to the Purchaser contains minutes of all meetings of directors and stockholders
and all actions by written consent without a meeting by the directors and stockholders since the date of incorporation and accurately
reflects in all material respects all actions by the directors (and any committee of directors) and stockholders with respect to
all transactions referred to in such minutes.


 


2.23 
83(b) Elections. To the Company’s knowledge, all elections and notices under Section 83(b) of the Code have
been or will be timely filed by all individuals who have acquired unvested shares of the Company’s Common Stock.


 


2.24 
Environmental and Safety Laws. To its knowledge (a) the Company is and has been in compliance with all Environmental
Laws; (b) there has been no release or to the Company’s knowledge threatened release of any pollutant, contaminant or
toxic or hazardous material, substance or waste or petroleum or any fraction thereof (each a “Hazardous Substance”),
on, upon, into or from any site currently or heretofore owned, leased or otherwise used by the Company; (c) there have been
no Hazardous Substances generated by the Company that have been disposed of or come to rest at any site that has been included
in any published U.S. federal, state or local “superfund” site list or any other similar list of hazardous or toxic
waste sites published by any governmental authority in the United States; and (d) there are no underground storage tanks located
on, no polychlorinated biphenyls (“PCBs”) or PCB-containing equipment used or stored on, and no hazardous waste
as defined by the Resource Conservation and Recovery Act, as amended, stored on, any site owned or operated by the Company, except
for the storage of hazardous waste in compliance with Environmental Laws. The Company has made available to the Purchaser true
and complete copies of all material environmental records, reports, notifications, certificates of need, permits, pending permit
applications, correspondence, engineering studies and environmental studies or assessments.


 


For
purposes of this Subsection 2.24, “Environmental Laws” means any law, regulation, or other applicable
requirement relating to (a) releases or threatened release of Hazardous Substance; (b) pollution or protection of employee health
or safety, public health or the environment; or (c) the manufacture, handling, transport, use, treatment, storage, or disposal
of Hazardous Substances.


 


2.25 
Data Privacy. In connection with its collection, storage, transfer (including, without limitation, any transfer across
national borders) and/or use of any personally identifiable information from any individuals, including, without limitation, any
customers, prospective customers, employees and/or other third parties (collectively “Personal Information”),
the Company is and has been in compliance with the Company’s privacy policies and the requirements of any contract or codes
of conduct to which the Company is a party and, to the Company’s knowledge, all applicable laws in all relevant jurisdictions.
The Company has commercially reasonable physical, technical, organizational and administrative security measures and policies in
place to protect its confidential information and all Personal Information collected by it or on its behalf from and against unauthorized
access, use and/or disclosure. To the extent the Company maintains or transmits protected health information, as defined under
45 C.F.R. § 160.103, the Company is in compliance with the applicable requirements of the Health Insurance Portability and
Accountability Act of 1996, as amended by the Health Information Technology for Economic and Clinical Health Act, including all
rules and regulations promulgated thereunder. The Company is and has been in compliance in all material respects with all laws
relating to data loss, theft and breach of security notification obligations.


 






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2.26 
Preclinical Development and Clinical Trials. The studies, tests, preclinical
development and clinical trials, if any, conducted by or on behalf of the Company are being conducted in all material respects
in accordance with experimental protocols, procedures and controls pursuant to accepted professional and scientific standards for
products or product candidates comparable to those being developed by the Company and all applicable laws and regulations,
including the Federal Food, Drug, and Cosmetic Act and 21 C.F.R. parts 50, 54, 56, 58, 312,
and 812. The descriptions of, protocols for, and data and other results of, the studies, tests, development and trials conducted
by or on behalf of the Company that have been furnished or made available to the Purchaser are accurate and complete. The Company
is not aware of any studies, tests, development or trials the results of which reasonably call into question the results of the
studies, tests, development and trials conducted by or on behalf of the Company, and the Company has not received any notices or
correspondence from the FDA or any other Governmental Entity or any Institutional Review Board or comparable authority requiring
the termination, suspension or material modification of any studies, tests, preclinical development or clinical trials conducted
by or on behalf of the Company.


 


2.27 
FDA Approvals. The Company possesses all permits, licenses, registrations, certificates, authorizations, orders and
approvals from the appropriate federal, state or foreign regulatory authorities necessary to conduct its business as now conducted,
including all such permits, licenses, registrations, certificates, authorizations, orders and approvals required by the U.S. Food
and Drug Administration (“FDA”) or any other federal, state or foreign agencies or bodies engaged in the regulation
of drugs, pharmaceuticals, medical devices or biohazardous
materials. The Company has not received any notice of proceedings relating to the suspension, modification, revocation or cancellation
of any such permit, license, registration, certificate, authorization, order or approval. Neither the Company nor, to the Company's
knowledge, any officer, employee or agent of the Company has been convicted of any crime or engaged in any conduct that has previously
caused or would reasonably be expected to result in (A) disqualification or debarment by the FDA under 21 U.S.C. Sections 335(a)
or (b), or any similar law, rule or regulation of any other Governmental Entities, (B) debarment,
suspension, or exclusion under any Federal Healthcare Programs or by the General Services Administration, or (C) exclusion
under 42 U.S.C. Section 1320a-7 or any similar law, rule or regulation of any Governmental Entities. Neither the Company nor any
of its officers, employees, or to the Knowledge of the Company, any of its contractors or agents is the subject of any pending
or threatened investigation by FDA pursuant to its “Fraud, Untrue Statements of Material Facts, Bribery, and Illegal Gratuities”
policy as stated at 56 Fed. Reg. 46191 (September 10, 1991) (the “FDA Application Integrity Policy”) and
any amendments thereto, or by any other similar Governmental Entity pursuant to any similar policy. Neither the Company nor any
of its officers, employees, contractors, and agents has committed any act, made any statement or failed to make any statement that
would reasonably be expected to provide a basis for FDA to invoke the FDA Application Integrity Policy or for any similar governmental
entity to invoke a similar policy. Neither the Company nor any of its officers, employees, or to the Company’s Knowledge,
any of its contractors or agents has made any materially false statements on, or material omissions from, any notifications, applications,
approvals, reports and other submissions to FDA or any similar governmental entity.


 


2.28 
Purchase Entirely for Own Account. This Agreement is made with the Company in reliance upon the Company’s representation
to the Purchaser, which by the Company’s execution of this Agreement, the Company hereby confirms, that the Purchaser Common
Stock to be acquired by the Company will be acquired for investment for the Company’s own account, not as a nominee or agent,
and not with a view to the resale or distribution of any part thereof, and that the Company has no present intention of selling,
granting any participation in, or otherwise distributing the same (other than to an Affiliate of the Company). By executing this
Agreement, the Company further represents that the Company does not presently have any contract, undertaking, agreement or arrangement
with any Person to sell, transfer or grant participations to such Person or to any third Person, with respect to any of the Purchaser
Common Stock, other than to an Affiliate of the Company.


 






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2.29 
Disclosure of Information. The Company has had an opportunity to discuss the Purchaser’s business, management,
financial affairs and the terms and conditions of the offering of the Purchaser Common Stock with the Purchaser’s management.
The foregoing, however, does not limit or modify the representations and warranties of the Purchaser in Section 3 of
this Agreement or the right of the Company to rely thereon.


 


2.30 
Restricted Securities. The Company understands that the Purchaser Common Stock has not been, and will not be, registered
under the Securities Act, by reason of a specific exemption from the registration provisions of the Securities Act which depends
upon, among other things, the bona fide nature of the investment intent and the accuracy of the Company’s representations
as expressed herein. The Company understands that the Purchaser Common Stock is “restricted securities” under applicable
U.S. federal and state securities laws and that, pursuant to these laws, the Company must hold the Purchaser Common Stock indefinitely
unless they are registered with the Securities and Exchange Commission and qualified by state authorities, or an exemption from
such registration and qualification requirements is available. The Company acknowledges that the Purchaser has no obligation to
register or qualify the Purchaser Common Stock for resale; provided that, to the extent the Purchaser Common Stock is eligible
for resale pursuant to Rule 144 under the Securities Act (“Rule 144”), the Purchaser shall use commercially
reasonable efforts to facilitate the Company’s or any Company Affiliate’s resale of the Purchase Common Stock pursuant
to Rule 144, including by instructing the Purchaser’s transfer agent to take any steps necessary to facilitate such resale.
The Company further acknowledges that if an exemption from registration or qualification is available, it may be conditioned on
various requirements including, but not limited to, the time and manner of sale, the holding period for the Purchaser Common Stock,
and on requirements relating to the Purchaser which are outside of the Company’s control, and which the Purchaser is under
no obligation and may not be able to satisfy.


 


2.31 
Legends. The Company understands that the Purchaser Common Stock may be notated with one or all of the following
legends:


 


“THE
SHARES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AND HAVE BEEN ACQUIRED FOR INVESTMENT AND
NOT WITH A VIEW TO, OR IN CONNECTION WITH, THE SALE OR DISTRIBUTION THEREOF. NO SUCH TRANSFER MAY BE EFFECTED WITHOUT AN EFFECTIVE
REGISTRATION STATEMENT RELATED THERETO OR AN OPINION OF COUNSEL IN A FORM SATISFACTORY TO THE COMPANY THAT SUCH REGISTRATION IS
NOT REQUIRED UNDER THE SECURITIES ACT OF 1933.”


 


(a) 
Any legend set forth in, or required by, the other Transaction Agreements.


 


(b) 
Any legend required by the securities laws of any state to the extent such laws are applicable to the Purchaser Common Stock
represented by the certificate, instrument, or book entry so legended.


 


2.32 
Accredited Investor. The Company is an accredited investor as defined in Rule 501(a) of Regulation D promulgated
under the Securities Act.


 


2.33 
No General Solicitation. Neither the Company, nor any of its officers, directors, employees, agents, stockholders
or partners has either directly or indirectly, including, through a broker or finder (a) engaged in any general solicitation,
or (b) published any advertisement in connection with the offer and sale of the Purchaser Common Stock.


 






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2.34 
Residence. The office of the Company in which its principal place of business is identified in the address or addresses
of the Company set forth on signature page hereto.


 


2.35 Obligations
of Management. Except as set forth on Section 2.35 of the Disclosure Schedule, each officer of the Company and Key Employee
is currently devoting all of his or her business time to the conduct of the business of the Company, and is not devoting any business
time to the conduct of any other business. The Company does not have any Knowledge that any officer of the Company or Key Employee
is planning to work less than full time at the Company in the future. No officer or Key Employee is currently working for or, to
the Company’s Knowledge, plans to work for a competitive enterprise, whether or not such officer or Key Employee is or will
be compensated by such enterprise.


 


2.36 Foreign
Corrupt Practices Act. Neither the Company nor any of the Company’s directors, officers, employees or agents have, directly
or indirectly, made, offered, promised or authorized any payment or gift of any money or anything of value to or for the benefit
of any “foreign official” (as such term is defined in the U.S. Foreign Corrupt Practices Act of 1977, as amended (the
 “FCPA”)), foreign political party or official thereof or candidate for foreign political office for the purpose
of (i) influencing any official act or decision of such official, party or candidate, (ii) inducing such official, party or candidate
to use his, her or its influence to affect any act or decision of a foreign governmental authority, or (iii) securing any improper
advantage, in the case of (i), (ii) and (iii) above in order to assist the Company or any of its affiliates in obtaining or retaining
business for or with, or directing business to, any person. Neither the Company nor any of its directors, officers, employees or
agents have made or authorized any bribe, rebate, payoff, influence payment, kickback or other unlawful payment of funds or received
or retained any funds in violation of any law, rule or regulation. The Company further represents that it has maintained, and has
caused each of its subsidiaries and affiliates to maintain, systems of internal controls (including, but not limited to, accounting
systems, purchasing systems and billing systems) to ensure compliance with the FCPA or any other applicable anti-bribery or anti-corruption
law. Neither the Company, or, to the Company’s Knowledge, any of its officers, directors or employees are the subject of
any allegation, voluntary disclosure, investigation, prosecution or other enforcement action related to the FCPA or any other anti-corruption
law.


 


2.37 Disclosure.
The Company has made available to the Purchaser all the information reasonably available to the Company that the Purchaser has
requested for deciding whether to acquire the Series B Securities. No representation or warranty of the Company contained in this
Agreement, as qualified by the Company Disclosure Schedule, and no certificate furnished or to be furnished to Purchaser at the
Closing contains or will contain, as applicable, any untrue statement of a material fact or omits to state a material fact necessary
in order to make the statements contained herein or therein not misleading in light of the circumstances under which they were
made. It is understood that this representation is qualified by the fact that the Company has not delivered to the Purchaser, and
has not been requested to deliver, a private placement or similar memorandum or any written disclosure of the types of information
customarily furnished to purchasers of securities.


 


3. 
Representations and Warranties of the Purchaser. The Purchaser hereby represents and warrants to the Company
that, except (i) as set forth on the Disclosure Schedule attached as Exhibit E to this Agreement, and (ii) as set forth
in the SEC Documents, which in each case exceptions shall be deemed to be part of the representations and warranties made hereunder,
the following representations are true and complete as of the date of the Initial Closing, except as otherwise indicated. The Disclosure
Schedule shall be arranged in sections corresponding to the numbered and lettered sections and subsections contained in this Section
3 and the disclosures in any section or subsection of the Disclosure Schedule shall qualify other sections and subsections
in this Section 3 only to the extent it is readily apparent from a reading of the disclosure that such disclosure is applicable
to such other sections and subsections.


 






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3.1 
Authorization. The Purchaser has full power and authority to enter into the Transaction Agreements. The Transaction
Agreements to which the Purchaser is a party, when executed and delivered by the Purchaser, will constitute valid and legally binding
obligations of the Purchaser, enforceable in accordance with their terms, except (a) as limited by applicable bankruptcy,
insolvency, reorganization, moratorium, fraudulent conveyance and any other laws of general application affecting enforcement of
creditors’ rights generally, and as limited by laws relating to the availability of specific performance, injunctive relief
or other equitable remedies, or (b) to the extent the indemnification provisions contained in the Investors’ Rights
Agreement may be limited by applicable federal or state securities laws.


 


3.2 
Valid Issuance of Purchase Common Stock. The Purchaser Common Stock, when issued, sold
and delivered in accordance with the terms and for the consideration set forth in the Transaction Agreements, will be validly issued,
fully paid and nonassessable and free of restrictions on transfer other than restrictions on transfer under the Transaction Agreements
and applicable state and federal securities laws. Assuming the accuracy of the representations of the Company in Section 2
of this Agreement, the Purchaser Common Stock will be issued in compliance with all applicable federal and state securities laws.


 


3.3 
Governmental Consents and Filings. Except as set forth in Subsection 3.3 of the Disclosure Schedule, assuming
the accuracy of the representations made by the Company in Section 2 of this Agreement, no consent, approval, order
or authorization of, or registration, qualification, designation, declaration or filing with, any federal, state or local governmental
authority is required on the part of the Purchaser in connection with the consummation of the transactions contemplated by this
Agreement, except for the filings pursuant to Regulation D of the Securities Act, and applicable state securities laws, which
have been made or will be made in a timely manner.


 


3.4 
Litigation. There is no claim, action, suit, proceeding, arbitration, complaint, charge or investigation pending
or currently threatened (i) against the Purchaser or any officer or director of the Purchaser; (ii) that questions the validity
of the Transaction Agreements or the right of the Company to enter into them, or to consummate the transactions contemplated by
the Transaction Agreements; or (iii) that would reasonably be expected to have, either individually or in the aggregate, a Material
Adverse Effect, nor is the Purchaser aware of any basis for the foregoing. Neither the Purchaser nor, to the Purchaser’s
knowledge, any of its officers or directors is a party or is named as subject to the provisions of any order, writ, injunction,
judgment or decree of any court or government agency or instrumentality (in the case of officers or directors, such as would affect
the Purchaser). There is no action, suit, proceeding or investigation by the Purchaser pending or which the Purchaser intends to
initiate. The foregoing includes, without limitation, actions, suits, proceedings or investigations pending or threatened (or any
basis therefor known to the Purchaser) involving the prior employment of any of the Purchaser’s employees, their services
provided in connection with the Purchaser’s business, any information or techniques allegedly proprietary to any of their
former employers or their obligations under any agreements with prior employers.


 


3.5 
SEC Documents. The Purchaser has filed all required SEC Documents required to be filed by it with the SEC since January
1, 2018. As of their respective dates, the SEC Documents (a) were prepared in accordance and complied in all material respects
with the requirements of the Securities Laws applicable to such SEC Documents, and (b) did not at the time they were filed (or
if amended or superseded by a filing prior to the date of this Agreement then on the date of such filing) contain any untrue statement
of a material fact or omit to state a material fact required to be stated therein or necessary in order to make the statements
therein, in the light of the circumstances under which they were made, not misleading. None of the Purchaser’s subsidiaries
is required to file any forms, reports or other documents with the SEC.


 


3.6 
Purchaser Financial Statements. The financial statements of the Purchaser included in the SEC Documents (the “Purchaser
Financial Statements”) comply as to form in all material respects with applicable accounting requirements and the published
rules and regulations of the SEC with respect thereto. The Purchaser Financial Statements have been prepared in accordance with
generally accepted accounting principles (“GAAP”) applied on a consistent basis throughout the periods indicated,
except that the unaudited Financial Statements may not contain all footnotes required by GAAP. The Financial Statements fairly
present in all material respects the financial condition and operating results of the Purchaser as of the dates, and for the periods,
indicated therein, subject in the case of the unaudited Purchaser Financial Statements to normal year-end audit adjustments.


 






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3.7 
Tax Returns and Payments. There are no federal, state, county, local or foreign taxes due and payable by the Purchaser
which have not been timely paid. There are no accrued and unpaid federal, state, country, local or foreign taxes of the Purchaser
which are due, whether or not assessed or disputed. There have been no examinations or audits of any tax returns or reports by
any applicable federal, state, local or foreign governmental agency. The Purchaser has duly and timely filed all federal, state,
county, local and foreign tax returns required to have been filed by it and there are in effect no waivers of applicable statutes
of limitations with respect to taxes for any year.


 


3.8 
Purchase Entirely for Own Account. This Agreement is made with the Purchaser in reliance upon the Purchaser’s
representation to the Company, which by the Purchaser’s execution of this Agreement, the Purchaser hereby confirms, that
the Series B Securities to be acquired by the Purchaser will be acquired for investment for the Purchaser’s own account,
not as a nominee or agent, and not with a view to the resale or distribution of any part thereof, and that the Purchaser has no
present intention of selling, granting any participation in, or otherwise distributing the same. By executing this Agreement, the
Purchaser further represents that the Purchaser does not presently have any contract, undertaking, agreement or arrangement with
any Person to sell, transfer or grant participations to such Person or to any third Person, with respect to any of the Series B
Securities. The Purchaser has not been formed for the specific purpose of acquiring the Series B Securities.


 


3.9 
Disclosure of Information. The Purchaser has had an opportunity to discuss the Company’s business, management,
financial affairs and the terms and conditions of the offering of the Series B Securities with the Company’s management and
has had an opportunity to review the Company’s facilities. The foregoing, however, does not limit or modify the representations
and warranties of the Company in Section 2 of this Agreement or the right of the Purchaser to rely thereon.


 


3.10 
Restricted Securities. The Purchaser understands that the Series B Securities have not been, and will not be, registered
under the Securities Act, by reason of a specific exemption from the registration provisions of the Securities Act which depends
upon, among other things, the bona fide nature of the investment intent and the accuracy of the Purchaser’s representations
as expressed herein. The Purchaser understands that the Series B Securities are “restricted securities” under applicable
U.S. federal and state securities laws and that, pursuant to these laws, the Purchaser must hold the Series B Securities indefinitely
unless they are registered with the Securities and Exchange Commission and qualified by state authorities, or an exemption from
such registration and qualification requirements is available. The Purchaser acknowledges that the Company has no obligation to
register or qualify the Series B Securities, or the Common Stock into which it may be converted, for resale except as set forth
in the Investors’ Rights Agreement. The Purchaser further acknowledges that if an exemption from registration or qualification
is available, it may be conditioned on various requirements including, but not limited to, the time and manner of sale, the holding
period for the Series B Securities, and on requirements relating to the Company which are outside of the Purchaser’s control,
and which the Company is under no obligation and may not be able to satisfy.


 


3.11 
No Public Market. The Purchaser understands that no public market now exists for the Series B Securities, and that
the Company has made no assurances that a public market will ever exist for the Series B Securities.


 






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3.12 
Legends. The Purchaser understands that the Series B Securities and any securities issued in respect of or exchange
for the Series B Securities, may be notated with one or all of the following legends:


 


“THE SHARES
REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AND HAVE BEEN ACQUIRED FOR INVESTMENT AND NOT WITH
A VIEW TO, OR IN CONNECTION WITH, THE SALE OR DISTRIBUTION THEREOF. NO SUCH TRANSFER MAY BE EFFECTED WITHOUT AN EFFECTIVE REGISTRATION
STATEMENT RELATED THERETO OR AN OPINION OF COUNSEL IN A FORM SATISFACTORY TO THE COMPANY THAT SUCH REGISTRATION IS NOT REQUIRED
UNDER THE SECURITIES ACT OF 1933.”


 


(a) 
Any legend set forth in, or required by, the other Transaction Agreements.


 


(b) 
Any legend required by the securities laws of any state to the extent such laws are applicable to the Series B Securities
represented by the certificate, instrument, or book entry so legended.


 


3.13 
Accredited Investor. The Purchaser is an accredited investor as defined in Rule 501(a) of Regulation D promulgated
under the Securities Act.


 


3.14 
No General Solicitation. Neither the Purchaser, nor any of its officers, directors, employees, agents, stockholders
or partners has either directly or indirectly, including, through a broker or finder (a) engaged in any general solicitation,
or (b) published any advertisement in connection with the offer and sale of the Series B Securities.


 


3.15 
Residence. The office of the Purchaser in which its principal place of business is identified in the address or addresses
of the Purchaser set forth on signature page hereto.


 


3.16 Disclosure.
The Purchaser has made available to the Company all the information reasonably available to the Purchaser that the Company has
requested for deciding whether to enter into the Transaction Agreements. No representation or warranty of the Purchaser contained
in this Agreement, as qualified by the Purchaser Disclosure Schedule, and no certificate furnished or to be furnished to the Company
at the Closing contains or will contain, as applicable, any untrue statement of a material fact or omits to state a material fact
necessary in order to make the statements contained herein or therein not misleading in light of the circumstances under which
they were made. It is understood that this representation is qualified by the fact that the Purchaser has not delivered to the
Company, and has not been requested to deliver, a private placement or similar memorandum or any written disclosure of the types
of information customarily furnished to purchasers of securities.


 


4. 
Conditions to the Purchaser’s Obligations at Closing. The
obligations of the Purchaser to purchase Series B Securities at the Initial Closing or any Milestone Closing are subject to the
fulfillment, on or before such Closing, of each of the following conditions, unless otherwise waived:


 


4.1 
Representations and Warranties. The representations and warranties of the Company contained in Section 2
shall be true and correct in all respects as of such Closing; provided that the Company shall have the opportunity to amend,
supplement and update the Company Disclosure Schedule as of the Milestone Closing with respect to any fact, occurrence, event,
effect, change, circumstance or development occurring between the Initial Closing and the Milestone Closing, and such amendment,
supplement or update will be deemed to have amended the Company Disclosure Schedule and to have modified the Company’s representations
and warranties contained herein as of the Milestone Closing.


 






    	 	20	 



     


    

 


4.2 
Performance. The Company shall have performed and complied with all covenants, agreements, obligations and conditions
contained in this Agreement that are required to be performed or complied with by the Company on or before such Closing.


 


4.3 
Compliance Certificate. The CEO of the Company shall deliver to the Purchaser at such Closing a certificate certifying
that the conditions specified in Subsections  4.1 and 4.2 have been fulfilled.


 


4.4 
Qualifications. All authorizations, approvals or permits, if any, of any governmental authority or regulatory body
of the United States or of any state that are required in connection with the lawful issuance and sale of the Series B Securities
pursuant to this Agreement shall be obtained and effective as of such Closing.


 


4.5 
Board of Directors. As of the Initial Closing, the authorized size of the Board shall
be three (3), and the Board shall be comprised of Leslie Buttorff, Adam Desmond and Clifford B. Fleet.


 


4.6 
Investors’ Rights Agreement. The Company and the Purchaser (other than the Purchaser relying upon this condition
to excuse the Purchaser’s performance hereunder) shall have executed and delivered the Investors’ Rights Agreement.


 


4.7 
Right of First Refusal and Co-Sale Agreement. The Company, the Purchaser (other than the Purchaser relying upon this
condition to excuse the Purchaser’s performance hereunder), and the other stockholders of the Company named as parties thereto
shall have executed and delivered the Right of First Refusal and Co-Sale Agreement.


 


4.8 
Voting Agreement. The Company, the Purchaser (other than the Purchaser relying upon this condition to excuse the
Purchaser’s performance hereunder), and the other stockholders of the Company named as parties thereto shall have executed
and delivered the Voting Agreement.


 


4.9 
Letter Agreement. The Company, Quintel, the Key Employees and the Purchaser (other than the Purchaser relying upon
this condition to excuse the Purchaser’s performance hereunder) shall have executed and delivered the Letter Agreement.


 


4.10 
Restated Certificate. The Company shall have filed the Restated Certificate with the Secretary of State of Colorado
on or prior to the Closing, which shall continue to be in full force and effect as of the Closing.


 


4.11 
Secretary’s Certificate. The Secretary of the Company shall have delivered to the Purchaser at the Closing
a certificate certifying (i) the Bylaws of the Company, (ii) resolutions of the Board approving the Transaction Agreements and
the transactions contemplated under the Transaction Agreements, and (iii) resolutions of the stockholders of the Company approving
the Restated Certificate and the other matters contemplated by the Transaction Agreements.


 


4.12 
Proceedings and Documents. All corporate and other proceedings in connection with the transactions contemplated at
the Closing and all documents incident thereto shall be reasonably satisfactory in form and substance to the Purchaser, and the
Purchaser (or its counsel) shall have received all such counterpart original and certified or other copies of such documents as
reasonably requested. Such documents may include good standing certificates.


 






    	 	21	 



     


    

 


4.13 
Preemptive Rights. The Company shall have fully satisfied (including with respect to rights of timely notification)
or obtained enforceable waivers in respect of any preemptive or similar rights directly or indirectly affecting any of its securities.


 


4.15 D&O
Insurance. Following the Initial Closing, the Company will obtain and maintain a Directors’ and Officers’ (D&O)
Insurance Policy on commercially reasonable terms, as determined by the Company’s Board of Directors, on directors and officers
of the Company in the aggregate amount of $5,000,000 payable to the Company.


 


5. 
Conditions of the Company’s Obligations at Closing. The obligations of the Company to sell Series B
Securities to the Purchaser at the Initial Closing or any Milestone Closing are subject to the fulfillment, on or before the Closing,
of each of the following conditions, unless otherwise waived:


 


5.1 
Representations and Warranties. The representations and warranties of the Purchaser contained in Section 3
shall be true and correct in all respects as of such Closing; provided that the Purchaser shall have the opportunity to
amend, supplement and update the Purchaser Disclosure Schedule as of the Milestone Closing with respect to any fact, occurrence,
event, effect, change, circumstance or development occurring between the Initial Closing and the Purchaser Closing, and such amendment,
supplement or update will be deemed to have amended the Purchaser Disclosure Schedule and to have modified the Purchaser’s
representations and warranties contained herein as of the Milestone Closing.


 


5.2 
Performance. The Purchaser shall have performed and complied with all covenants, agreements, obligations and conditions
contained in this Agreement that are required to be performed or complied with by them on or before such Closing.


 


5.3 
Qualifications. All authorizations, approvals or permits, if any, of any governmental authority or regulatory body
of the United States or of any state that are required in connection with the lawful issuance and sale of the Series B Securities
pursuant to this Agreement shall be obtained and effective as of the Closing.


 


5.4 
Investors’ Rights Agreement. The Purchaser shall have executed and delivered the Investors’ Rights Agreement.


 


5.5 
Right of First Refusal and Co-Sale Agreement. The Purchaser and the other stockholders of the Company named as parties
thereto shall have executed and delivered the Right of First Refusal and Co-Sale Agreement.


 


5.6 
Voting Agreement. The Purchaser and the other stockholders of the Company named as parties thereto shall have executed
and delivered the Voting Agreement.


 


5.7 
Letter Agreement. The Purchaser shall have executed and delivered the Letter Agreement.


 


5.8 Secretary’s
Certificate. The Secretary of the Purchaser shall have delivered to the Company at the Closing a certificate certifying (i)
the Bylaws of the Purchaser and (ii) resolutions of the Board of the Purchaser approving the Transaction Agreements and the transactions
contemplated under the Transaction Agreements.


 






    	 	22	 



     


    

 


5.9 Compliance
Certificate. The CEO of the Purchaser shall deliver to the Company at such Closing a certificate certifying that the conditions
specified in Subsections  5.1 and 5.2 have been fulfilled.


  


6. 
Miscellaneous.


 


6.1 
Survival of Warranties. Unless otherwise set forth in this Agreement, the representations and warranties of the Company
and the Purchaser contained in or made pursuant to this Agreement shall survive the execution and delivery of this Agreement and
the Closing.


 


6.2 
Successors and Assigns. The terms and conditions of this Agreement shall
inure to the benefit of and be binding upon the respective successors and assigns of the parties. Nothing in this Agreement, express
or implied, is intended to confer upon any party other than the parties hereto or their respective successors and assigns any rights,
remedies, obligations or liabilities under or by reason of this Agreement, except as expressly provided in this Agreement.


 


6.3 
Governing Law. This Agreement shall be governed by the internal law
of the State of Delaware without regard to conflict of law principles that would result in the application of any law other than
the law of the State of Delaware.


 


6.4 
Counterparts. This Agreement may be executed in two (2) or more counterparts, each of which shall be deemed an original,
but all of which together shall constitute one and the same instrument. Counterparts may be delivered via facsimile, electronic
mail (including pdf or any electronic signature complying with the U.S. federal ESIGN Act of 2000, e.g., www.docusign.com)
or other transmission method and any counterpart so delivered shall be deemed to have been duly and validly delivered and be valid
and effective for all purposes.


 


6.5 
Titles and Subtitles. The titles and subtitles used in this Agreement
are used for convenience only and are not to be considered in construing or interpreting this Agreement.


 


6.6 
Notices. All notices and other communications given or made pursuant
to this Agreement shall be in writing and shall be deemed effectively given upon the earlier of actual receipt, or (a) personal
delivery to the party to be notified, (b) when sent, if sent by electronic mail or facsimile during normal business hours of the
recipient, and if not sent during normal business hours, then on the recipient’s next business day, (c) five (5) days after
having been sent by registered or certified mail, return receipt requested, postage prepaid, or (d) one (1) business day after
deposit with a nationally recognized overnight courier, freight prepaid, specifying next business day delivery, with written verification
of receipt. All communications shall be sent to the respective parties at their address as set forth on the signature page, or
to such e-mail address, facsimile number or address as subsequently modified by written notice given in accordance with this Subsection 6.6.
If notice is given to the Company, it shall be sent to 16194 W 45th Drive, Golden, CO 80403, Attention: Chief Executive Officer,
a copy (which shall not constitute notice) shall also be sent to Holland & Hart LLP, 1800 Broadway, Suite 300, Boulder, CO
80302, Attention: Amos Barclay, Email: AWBarclay@hollandhart.com; and if notice is given to the Purchaser, it shall be sent to
8560 Main Street, Suite 4, Williamsville, New York 14221, Attention: Chief Executive Officer a copy (which shall not constitute
notice) shall also be given to Troutman Sanders LLP, 1001 Haxall Point 15th Floor Richmond, VA 23219, Attention: Coby Beck, Email:
coby.beck@troutman.com.


 






    	 	23	 



     


    

 


6.7 
No Finder’s Fees. Other than the Company’s fees payable to Golden Eagle Partners for its services in
connection with the transactions contemplated hereby, each party represents that it neither is nor will be obligated for any finder’s
fee or commission in connection with this transaction. The Purchaser agrees to indemnify and to hold harmless the Company from
any liability for any commission or compensation in the nature of a finder’s or broker’s fee arising out of this transaction
(and the costs and expenses of defending against such liability or asserted liability) for which the Purchaser or any of its
officers, employees or representatives is responsible. The Company agrees to indemnify and hold harmless the Purchaser from any
liability for any commission or compensation in the nature of a finder’s or broker’s fee arising out of this transaction
(and the costs and expenses of defending against such liability or asserted liability) for which the Company or any of its officers,
employees or representatives is responsible.


 


6.8 
Fees and Expenses. 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 and the other Transaction Agreements.


 


6.9 
Attorneys’ Fees. If any action at law or in equity (including, arbitration) is necessary to enforce or interpret
the terms of any of the Transaction Agreements, the prevailing party shall be entitled to reasonable attorneys’ fees, costs
and necessary disbursements in addition to any other relief to which such party may be entitled.


 


6.10 
Amendments and Waivers. Except as set forth in Subsection 1.3(a) of this Agreement, any term of this
Agreement may be amended, terminated or waived only with the written consent of the Company and (i) the holders of at least 50%
of the then-outstanding Shares. Any amendment or waiver effected in accordance with this Subsection 6.10 shall be binding
upon the Purchaser and each transferee of the Shares (or the Common Stock issuable upon conversion thereof), each future holder
of all such securities, and the Company.


 


6.11 
Severability. The invalidity or unenforceability of any provision hereof shall in no way affect the validity or enforceability
of any other provision.


 


6.12 
Delays or Omissions. No delay or omission to exercise any right, power or remedy accruing to any party under this
Agreement, upon any breach or default of any other party under this Agreement, shall impair any such right, power or remedy of
such non-breaching or non-defaulting party nor shall it be construed to be a waiver of any such breach or default, or an acquiescence
therein, or of or in any similar breach or default thereafter occurring; nor shall any waiver of any single breach or default be
deemed a waiver of any other breach or default theretofore or thereafter occurring. Any waiver, permit, consent or approval of
any kind or character on the part of any party of any breach or default under this Agreement, or any waiver on the part of any
party of any provisions or conditions of this Agreement, must be in writing and shall be effective only to the extent specifically
set forth in such writing. All remedies, either under this Agreement or by law or otherwise afforded to any party, shall be cumulative
and not alternative.


 


6.13 
Entire Agreement. This Agreement (including the Exhibits hereto), the Restated Certificate and the other Transaction
Agreements constitute the full and entire understanding and agreement between the parties with respect to the subject matter hereof,
and any other written or oral agreement relating to the subject matter hereof existing between the parties are expressly canceled.


 


6.14 
Termination of Closing Obligations. The Purchaser shall have the right to terminate its obligations to complete the Initial
Closing and any Milestone Closing, as the case may be, if prior to the occurrence thereof, any of the following occurs:


 






    	 	24	 



     


    

 


(a) 
the Company consummates a Deemed Liquidation Event (as defined in the Restated Certificate);


 


(b) 
the closing of an initial public offering of the Company, in which case the Purchaser may terminate their obligations hereunder
immediately prior to, or contingent upon, such closing; or


 


(c) 
the Company (i) applies for or consents to the appointment of a receiver, trustee, custodian or liquidator of itself or
substantially all of its property, (ii) becomes subject to the appointment of a receiver, trustee, custodian or liquidator of itself
or substantially all of its property, (iii) makes an assignment for the benefit of creditors, (iv) institutes any proceedings under
the United States Bankruptcy Code or any other federal or state bankruptcy, reorganization, receivership, insolvency or other similar
law affecting the rights of creditors generally, or files a petition or answer seeking reorganization or an arrangement with creditors
to take advantage of any insolvency law, or files an answer admitting the material allegations of a bankruptcy, reorganization
or insolvency petition filed against it, or (v) becomes subject to any involuntary proceedings under the United States Bankruptcy
Code or any other federal or state bankruptcy, reorganization, receivership, insolvency or other similar law affecting the rights
of creditors generally, when proceeding is not dismissed within thirty (30) days of filing, or have an order for relief entered
against it in any proceedings under the United States Bankruptcy Code.


 


6.15 
Dispute Resolution. The parties (a) hereby irrevocably and unconditionally submit to the jurisdiction of the federal
courts of the United States of America for the district of Delaware or the courts of the state of Delaware for the purpose of any
suit, action or other proceeding arising out of or based upon this Agreement, (b) agree not to commence any suit, action or other
proceeding arising out of or based upon this Agreement except in the federal courts of the United States of America for the district
of Delaware or the courts of the state of Delaware, and (c) hereby waive, and agree not to assert, by way of motion, as a defense,
or otherwise, in any such suit, action or proceeding, any claim that it is not subject personally to the jurisdiction of the above-named
courts, that its property is exempt or immune from attachment or execution, that the suit, action or proceeding is brought in an
inconvenient forum, that the venue of the suit, action or proceeding is improper or that this Agreement or the subject matter hereof
may not be enforced in or by such court.


 


Waiver
of Jury Trial: EACH PARTY HEREBY WAIVES ITS RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING
OUT OF THIS AGREEMENT, THE OTHER TRANSACTION AGREEMENTS, THE SERIES B SECURITIES OR THE SUBJECT MATTER HEREOF OR THEREOF. THE SCOPE
OF THIS WAIVER IS INTENDED TO BE ALL-ENCOMPASSING OF ANY AND ALL DISPUTES THAT MAY BE FILED IN ANY COURT AND THAT RELATE TO THE
SUBJECT MATTER OF THIS TRANSACTION, INCLUDING, WITHOUT LIMITATION, CONTRACT CLAIMS, TORT CLAIMS (INCLUDING NEGLIGENCE), BREACH
OF DUTY CLAIMS, AND ALL OTHER COMMON LAW AND STATUTORY CLAIMS. THIS SECTION HAS BEEN FULLY DISCUSSED BY EACH OF THE PARTIES HERETO
AND THESE PROVISIONS WILL NOT BE SUBJECT TO ANY EXCEPTIONS. EACH PARTY HERETO HEREBY FURTHER WARRANTS AND REPRESENTS THAT SUCH
PARTY HAS REVIEWED THIS WAIVER WITH ITS LEGAL COUNSEL, AND THAT SUCH PARTY KNOWINGLY AND VOLUNTARILY WAIVES ITS JURY TRIAL RIGHTS
FOLLOWING CONSULTATION WITH LEGAL COUNSEL.


 


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IN
WITNESS WHEREOF, the parties have executed this Series B Preferred Securities Purchase Agreement as of the date first written above.


 





	 	COMPANY:	 
	 	 	 
	 	PANACEA LIFE SCIENCES, INC.
	 	 
	 	 
	 	By: 	/s/ Leslie Buttorff
	 	Name:	Leslie Buttorff
	 	Title:	CEO
	 	 	 
	 	 	 
	 	Address: 	16194 West 45th Drive,
	 	 	Golden, CO 80403
	 	 	 
	 	Attn: 	Leslie Buttorff
	 	Telephone:	303-434-0215
	 	Facsimile: 	 
	 	Email:	leslie.buttorff@panacealife.com







  





	 	PURCHASER:
	 	 
	 	22ND CENTURY GROUP, INC.
	 	 
	 	 	 
	 	By: 	/s/ Clifford B. Fleet
	 	Name:	Clifford B. Fleet
	 	Title:	President and CEO
	 	 	 
	 	 	 
	 	Address: 	8560 Main Street, Suite 4, 
	 	 	Williamsville, New York 14221
	 	 	 
	 	Attn: 	Chief Executive Officer
	 	Telephone:	716-270-1523
	 	Facsimile: 	716-877-3064
	 	Email:	cfleet@xxiicentury.com







 






    
 


     


    

 


EXHIBITS


 





	Exhibit A -	FORM OF SECOND AMENDED AND RESTATED ARTICLES OF INCORPORATION
	 	 
	Exhibit B - 	FORM OF NOTE
	 	 
	Exhibit C - 	FORM OF WARRANT
	 	 
	Exhibit D -	COMPANY DISCLOSURE SCHEDULE
	 	 
	Exhibit E - 	PURCHASER DISCLOSURE SCHEDULE
	 	 
	Exhibit F -	FORM OF INVESTORS’ RIGHTS AGREEMENT
	 	 
	Exhibit G -	Form of Right of First Refusal and Co-Sale Agreement
	 	 
	Exhibit H -	FORM OF VOTING AGREEMENT
	 	 
	Exhibit I - 	FORM OF LETTER AGREEMENT
	 	 
	Exhibit J - 	FORM OF SECURITY AGREEMENT