Blueprint










SECURITIES
PURCHASE AGREEMENT

 


This
Securities Purchase Agreement (this “Agreement”) is dated as
July 18, 2019, between ParkerVision, Inc., a Florida corporation
(the “Company”), and each
purchaser identified on the signature pages hereto (each, including
its successors and assigns, a “Purchaser” and
collectively, the “Purchasers”).

 


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

 


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

 

 



ARTICLE I.



DEFINITIONS

 

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

 


“Acquiring Person” shall
have the meaning ascribed to such term in Section 4.5

 


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

 


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

 


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

 


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

 


   
          “Change in Control” means,
with respect to the Company:


 




(i)

other than a
shareholder that holds such a position at the date of this
Agreement, if a Person comes to have beneficial ownership, control
or direction over more than forty percent (40%) of the voting
rights attached to any class of voting securities of the Company;
or






 




(ii)

the sale or other
disposition by the Company and its Subsidiaries in a single
transaction, or in a series of transactions, of all or
substantially all of the Company’s respective
assets.






 

 


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

 


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

 


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

 


“Common Stock” means the
common stock of the Company, par value $0.01 per share, and any
other class of securities into which such securities may hereafter
be reclassified or changed.

 


“Common Stock Equivalents”
means any securities of the Company or the Subsidiaries which would
entitle the holder thereof to acquire at any time Common Stock,
including, without limitation, any debt, preferred stock, right,
option, warrant or other instrument that is at any time convertible
into or exercisable or exchangeable for, or otherwise entitles the
holder thereof to receive, Common Stock.

 


“Company Counsel” means
Graubard Miller, with offices located at 405 Lexington Avenue, New
York, New York 10174.

 


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

 


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

 


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

 


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

 


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


 


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

 


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

 


“Issuer Covered Person”
shall have the meaning ascribed to such term in Section
3.1(ff).

 


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

 


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

 


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

 


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

 


“Notes” means the 8%
Convertible Notes due, subject to the terms therein, 5 years from
their date of issuance, issued by the Company to the Purchasers
hereunder, in the form of Exhibit A attached
hereto.

 


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

 


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

 


“Public Information
Failure” shall have the meaning ascribed to such term
in Section 4.2(b).

 


“Public Information Failure
Payments” shall have the meaning ascribed to such term
in Section 4.2(b).

 


“Purchaser Party” shall
have the meaning ascribed to such term in Section 4.8.

 


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

 


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

 


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

 


“Required Minimum” means,
that number of shares of Common Stock equal to the sum of (i) the
aggregate principal amount of the Notes divided by the Conversion
Price and (ii) the aggregate interest payments over the term of the
Notes divided by the closing price of the Common Stock on the day
prior to the Closing Date.

 


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

 


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

 


“Securities” means the
Notes and the Underlying Shares.

 


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

 


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

 


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

 


“Trading Day” means a day
on which the principal Trading Market is open for
trading.

 


“Trading Market” means any
of the following markets or exchanges on which the Common Stock is
listed or quoted for trading on the date in question: the NYSE
American, the Nasdaq Capital Market, the Nasdaq Global Market, the
Nasdaq Global Select Market, the New York Stock Exchange or the
Over-the-Counter Bulletin Board (the OTCQB, the OTCQX or the
“Pink Sheets” published by The OTC Markets Group, Inc.
or a similar organization or agency succeeding to its functions or
reporting prices), or any successors to any of the
foregoing.

 


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

 


“Transfer Agent” means
American Stock Transfer & Trust Co., the current transfer agent of the
Company, with a mailing address of 6201 15th Avenue, Brooklyn, NY
11219, and any successor transfer agent of the
Company.

 


“Underlying Shares” means
the shares of Common Stock issued and issuable pursuant to the
terms of the Note, including without limitation, shares of Common
Stock issued and issuable in lieu of the cash payment of interest
on the Notes in accordance with the terms of the Notes, in each
case without respect to any limitation or restriction on the
conversion of the Notes.

 


 

 

 



ARTICLE II.



PURCHASE AND SALE

 

2.1 Closing. On the Closing Date,
upon the terms and subject to the conditions set forth herein,
substantially concurrent with the execution and delivery of this
Agreement by the parties hereto, the Company agrees to sell, and
the Purchasers, severally and not jointly, agree to purchase, up to
an aggregate of $700,000 in
principal amount of the Notes. Each Purchaser shall deliver to the
Company, via wire transfer or a certified check, immediately
available funds equal to such Purchaser’s Subscription Amount
as set forth on the signature page hereto executed by such
Purchaser, and the Company shall deliver to each Purchaser its
respective Note, as determined pursuant to Section 2.2(a), and the
Company and each Purchaser shall deliver the other items set forth
in Section 2.2 deliverable at the Closing. Upon satisfaction of the
covenants and conditions set forth in Sections 2.2 and 2.3, the
Closing shall occur at the offices of Company Counsel or such other
location as the parties shall mutually agree.

 

2.2 Deliveries.

 

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


 

(i)     
this Agreement duly executed by the Company;

 


(ii)
a Note with a
principal amount equal to such Purchaser’s Subscription
Amount, registered in the name of such Purchaser;

 

(iii) the
Company shall have provided each Purchaser with the Company’s
wire instructions, on Company letterhead

 

(iv) the
Registration Rights Agreement duly executed by the
Company.

 


 

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

 

(i) this Agreement duly
executed by such Purchaser;

 

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

 

(iii) the
Registration Rights Agreement duly executed by such
Purchaser.

 


 

2.3 Closing
Conditions.

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

 



ARTICLE III.



REPRESENTATIONS AND WARRANTIES

 

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

 

(a) Subsidiaries; Organization and
Qualification. All of the direct and indirect subsidiaries
of the Company are set forth on Schedule 3.1(a). The Company owns,
directly or indirectly, all of the capital stock or other equity
interests of each Subsidiary free and clear of any Liens, and all
of the issued and outstanding shares of capital stock of each
Subsidiary are validly issued and are fully paid, non-assessable
and free of preemptive and similar rights to subscribe for or
purchase securities. The Company and each of its subsidiaries is an
entity duly incorporated or otherwise organized, validly existing
and in good standing under the laws of the jurisdiction of its
incorporation or organization (as applicable), with the requisite
power and authority to own and use its properties and assets and to
carry on its business as currently conducted. Neither the Company
nor any subsidiary is in violation or default of any of the
provisions of its articles of incorporation, bylaws or other
organizational or charter documents. Each of the Company and its
subsidiaries is duly qualified to conduct business and is in good
standing as a foreign corporation or other entity in each
jurisdiction in which the nature of the business conducted or
property owned by it makes such qualification necessary, except
where the failure to be so qualified or in good standing, as the
case may be, could not have or reasonably be expected to result in
(i) a material adverse effect on the legality, validity or
enforceability of any Transaction Document, (ii) a material adverse
effect on the results of operations, assets, business, prospects or
condition (financial or otherwise) of the Company, taken as a
whole, or (iii) a material adverse effect on the Company’s
ability to perform in any material respect its obligations under
any Transaction Document (any of (i), (ii) or (iii), a
“Material Adverse
Effect”), and no Proceeding has been instituted in any
such jurisdiction revoking, limiting or curtailing or seeking to
revoke, limit or curtail such power and authority or
qualification.

 

(b) Authorization;
Enforcement.

 

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

 


 

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

 

(d) Filings, Consents and
Approvals. The Company is not required to obtain any
consent, waiver, authorization or order of, give any notice to, or
make any filing or registration with, any court or other federal,
state, local or other governmental authority or other Person in
connection with the execution, delivery and performance by the
Company of the Transaction Documents, other than: (i) such filings,
if any, as are required to be made under applicable Federal and
state securities laws, including the filings required pursuant to
Section 4.4, the filing with the Commission of a Registration
Statement and the filing with the Commission of a Form D, (ii) such
notices or applications, if any, as are required to be given or
made to the Trading Market for the issuance and sale of the Shares
and the listing of the Shares for trading thereon and (iii) such
filings as are required to be made under applicable state
securities laws (the “Required
Approvals”).

 

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

 

(f) Capitalization. The
capitalization of the Company as of the date hereof is as set forth
on Schedule 3.1(f)
of the Disclosure Schedules. Except as set forth in the SEC Reports
or Schedule 3.1(f),
the Company has not issued any capital stock since its most recently filed periodic report under the
Exchange Act, other than pursuant to the exercise of
employee stock options and the vesting of restricted stock units
under the Company’s equity incentive plans and pursuant to
the conversion or exercise or exchange of Common Stock Equivalents
outstanding as of the date of the most recently filed periodic
report under the Exchange Act. No Person has any right of first
refusal, preemptive right, right of participation, or any similar
right to participate in the transactions contemplated by the
Transaction Documents. Except as set forth in the SEC Reports or
Schedule 3.1(f) and
except for outstanding awards under the Company’s equity
incentive plans, there are no outstanding options, warrants, scrip
rights to subscribe to, calls or commitments of any character
whatsoever relating to, or securities, rights or obligations
convertible into or exercisable or exchangeable for, or giving any
Person any right to subscribe for or acquire any shares of Common
Stock or the capital stock of any Subsidiary, or contracts,
commitments, understandings or arrangements by which the Company or
any Subsidiary is or may become bound to issue additional shares of
Common Stock or Common Stock Equivalents or capital stock of any
Subsidiary. The issuance and sale of the Securities will not
obligate the Company or any Subsidiary to issue shares of Common
Stock or other securities to any Person (other than the Purchasers)
and will not result in a right of any holder of Company securities
to adjust the exercise, conversion, exchange or reset price under
any of such securities. There are no outstanding securities or
instruments of the Company or any Subsidiary that contain any
redemption or similar provisions, and there are no contracts,
commitments, understandings or arrangements by which the Company or
any Subsidiary is or may become bound to redeem a security of the
Company or such Subsidiary. All of the outstanding shares of
capital stock of the Company are duly authorized, validly issued,
fully paid and nonassessable, have been issued in compliance with
all federal and state securities laws, and none of such outstanding
shares was issued in violation of any preemptive rights or similar
rights to subscribe for or purchase securities. No further approval
or authorization of any stockholder, the Board of Directors or
others is required for the issuance and sale of the Securities,
except as provided in Section 4.9. There are no stockholders
agreements, voting agreements or other similar agreements with
respect to the Company’s capital stock to which the Company
is a party or, to the knowledge of the Company, between or among
any of the Company’s stockholders.

 

(g) SEC Reports; Financial
Statements. The Company has filed all reports, schedules,
forms, statements and other documents required to be filed by the
Company under the Securities Act and the Exchange Act, including
pursuant to Section 13(a) or 15(d) thereof, for the two years
preceding the date hereof (or such shorter period as the Company
was required by law or regulation to file such material) (the
foregoing materials, including the exhibits thereto and documents
incorporated by reference therein, being collectively referred to
herein as the “SEC
Reports”) on a timely basis or has received a valid
extension of such time of filing and has filed any such SEC Reports
prior to the expiration of any such extension. As of their
respective dates, the SEC Reports complied in all material respects
with the requirements of the Securities Act and the Exchange Act,
as applicable, and none of the SEC Reports, when filed, contained
any untrue statement of a material fact or omitted to state a
material fact required to be stated therein or necessary in order
to make the statements therein, in the light of the circumstances
under which they were made, not misleading. The financial
statements of the Company included in the SEC Reports comply in all
material respects with applicable accounting requirements and the
rules and regulations of the Commission with respect thereto as in
effect at the time of filing. Such financial statements have been
prepared in accordance with United States generally accepted
accounting principles applied on a consistent basis during the
periods involved (“GAAP”), except as may be
otherwise specified in such financial statements or the notes
thereto and except that unaudited financial statements may not
contain all footnotes required by GAAP, and fairly present in all
material respects the financial position of the Company and its
consolidated Subsidiaries as of and for the dates thereof and the
results of operations and cash flows for the periods then ended,
subject, in the case of unaudited statements, to normal,
immaterial, year-end audit adjustments.

 

(h) Material Changes; Undisclosed Events,
Liabilities or Developments. Since the date of the latest
audited financial statements included within the SEC Reports,
except as set forth on Schedule 3.1(h) of the Disclosure
Schedules, (i) there has been no event, occurrence or
development that has had or that could reasonably be expected to
result in a Material Adverse Effect, (ii) the Company has not
incurred any liabilities (contingent or otherwise) other than (A)
trade payables and accrued expenses incurred in the ordinary course
of business consistent with past practice and (B) liabilities not
required to be reflected in the Company’s financial
statements pursuant to GAAP or disclosed in filings made with the
Commission, (iii) the Company has not altered its method of
accounting, (iv) the Company has not declared or made any dividend
or distribution of cash or other property to its stockholders or
purchased, redeemed or made any agreements to purchase or redeem
any shares of its capital stock, except in connection with the
payment of the exercise price of, or withholding taxes for, awards
under the Company’s equity incentive plans and (v) the
Company has not issued any equity securities to any officer,
director or Affiliate, except pursuant to existing Company equity
incentive plans. Except for the issuance of the Securities
contemplated by this Agreement or as set forth on Schedule 3.1(h), no event,
liability, fact, circumstance, occurrence or development has
occurred or exists or is reasonably expected to occur or exist with
respect to the Company or its Subsidiaries or their respective
businesses, prospects, properties, operations, assets or financial
condition, that would be required to be disclosed by the Company
under applicable securities laws at the time this representation is
made or deemed made that has not been publicly disclosed at least 1
Trading Day prior to the date that this representation is
made.

 

(i) Litigation. Except as set forth
in the SEC Reports, there is no action, suit, inquiry, notice of
violation, proceeding or investigation pending or, to the knowledge
of the Company, threatened against or affecting the Company, any
Subsidiary or any of their respective properties before or by any
court, arbitrator, governmental or administrative agency or
regulatory authority (federal, state, county, local or foreign)
(collectively, an “Action”) which (i)
adversely affects or challenges the legality, validity or
enforceability of any of the Transaction Documents or the
Securities or (ii) could, if there were an unfavorable decision,
have or reasonably be expected to result in a Material Adverse
Effect. Neither the Company nor any Subsidiary, nor any director or
officer thereof, is or has been the subject of any Action involving
a claim of violation of or liability under federal or state
securities laws or a claim of breach of fiduciary duty. There has
not been, and to the knowledge of the Company, there is not pending
or contemplated, any investigation by the Commission involving the
Company or any current or former director or officer of the
Company. The Commission has not issued any stop order or other
order suspending the effectiveness of any registration statement
filed by the Company or any Subsidiary under the Exchange Act or
the Securities Act.

 

(j) Labor Relations. No labor
dispute exists or, to the knowledge of the Company, is imminent
with respect to any of the employees of the Company, which could
reasonably be expected to result in a Material Adverse Effect. None
of the Company’s or its Subsidiaries’ employees is a
member of a union that relates to such employee’s
relationship with the Company or such Subsidiary, and neither the
Company nor any of its Subsidiaries is a party to a collective
bargaining agreement, and the Company and its Subsidiaries believe
that their relationships with their employees are good. To the
knowledge of the Company, no executive officer of the Company or
any Subsidiary, is, or is now expected to be, in violation of any
material term of any employment contract, confidentiality,
disclosure or proprietary information agreement or non-competition
agreement, or any other contract or agreement or any restrictive
covenant in favor of any third party, and the continued employment
of each such executive officer does not subject the Company or any
of its Subsidiaries to any liability with respect to any of the
foregoing matters. The Company and its Subsidiaries are in
compliance with all U.S. federal, state, local and foreign laws and
regulations relating to employment and employment practices, terms
and conditions of employment and wages and hours, except where the
failure to be in compliance could not, individually or in the
aggregate, reasonably be expected to have a Material Adverse
Effect.

 

(k) Compliance. Neither the Company
nor any Subsidiary: (i) is in default under or in violation of (and
no event has occurred that has not been waived that, with notice or
lapse of time or both, would result in a default by the Company or
any Subsidiary under), nor has the Company or any Subsidiary
received notice of a claim that it is in default under or that it
is in violation of, any indenture, loan or credit agreement or any
other agreement or instrument to which it is a party or by which it
or any of its properties is bound (whether or not such default or
violation has been waived), (ii) is in violation of any judgment,
decree or order of any court, arbitrator or other governmental
authority or (iii) is or has been in violation of any statute,
rule, ordinance or regulation of any governmental authority,
including without limitation all foreign, federal, state and local
laws relating to taxes, environmental protection, occupational
health and safety, product quality and safety and employment and
labor matters, except in each case as could not have or reasonably
be expected to result in a Material Adverse Effect.

 

(l) Environmental Laws. The Company
and its Subsidiaries (i) are in compliance with all federal, state,
local and foreign laws relating to pollution or protection of human
health or the environment (including ambient air, surface water,
groundwater, land surface or subsurface strata), including laws
relating to emissions, discharges, releases or threatened releases
of chemicals, pollutants, contaminants, or toxic or hazardous
substances or wastes (collectively, “Hazardous Materials”)
into the environment, or otherwise relating to the manufacture,
processing, distribution, use, treatment, storage, disposal,
transport or handling of Hazardous Materials, as well as all
authorizations, codes, decrees, demands, or demand letters,
injunctions, judgments, licenses, notices or notice letters,
orders, permits, plans or regulations, issued, entered, promulgated
or approved thereunder (“Environmental Laws”);
(ii) have received all permits licenses or other approvals required
of them under applicable Environmental Laws to conduct their
respective businesses; and (iii) are in compliance with all terms
and conditions of any such permit, license or approval where in
each clause (i), (ii) and (iii), the failure to so comply could be
reasonably expected to have, individually or in the aggregate, a
Material Adverse Effect.

 

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

 

(n) Title to Assets. The Company
and its subsidiary have good and marketable title in fee simple to
all real property owned by it that is material to the business of
the Company and good and marketable title in all personal property
owned by it that is material to the business of the Company, in
each case free and clear of all Liens, except for Liens as do not
materially affect the value of such property and do not materially
interfere with the use made and proposed to be made of such
property by the Company and Liens for the payment of federal, state
or other taxes, the payment of which is neither delinquent nor
subject to penalties. Any real property and facilities held under
lease by the Company are held by it under valid, subsisting and
enforceable leases with which the Company is in
compliance.

 

(o) Intellectual Property. The
Company and its subsidiary own, possess, or can acquire on
reasonable terms, all Intellectual Property necessary for the
conduct of its business as now conducted or as described in the SEC
Reports to be conducted, except as such failure to own, possess, or
acquire such rights would not result in a Material Adverse Effect.
Except as set forth in the SEC Reports, (i) to the knowledge of the
Company, there is no infringement, misappropriation or violation by
third parties of any such Intellectual Property, except as such
infringement, misappropriation or violation would not result in a
Material Adverse Effect; (ii) there is no pending or, to the
knowledge of the Company, threatened action, suit, proceeding or
claim by others challenging the Company’s rights in or to any
such Intellectual Property, and the Company is unaware of any facts
which would form a reasonable basis for any such claim; (iii) the
Intellectual Property owned by the Company and to the knowledge of
the Company, the Intellectual Property licensed to the Company has
not been adjudged invalid or unenforceable, in whole or in part,
and there is no pending or threatened action, suit, proceeding or
claim by others challenging the validity or scope of any such
Intellectual Property, and the Company is unaware of any facts
which would form a reasonable basis for any such claim; (iv) there
is no pending or threatened action, suit, proceeding or claim by
others that the Company infringes, misappropriates or otherwise
violates any Intellectual Property or other proprietary rights of
others, the Company has not received any written notice of such
claim, and the Company is unaware of any other fact which would
form a reasonable basis for any such claim; and (v) to the
Company’s knowledge, no employee of the Company is in or has
ever been in violation of any term of any employment contract,
patent disclosure agreement, invention assignment agreement,
non-competition agreement, non-solicitation agreement,
nondisclosure agreement or any restrictive covenant to or with a
former employer where the basis of such violation relates to such
employee’s employment with the Company or actions undertaken
by the employee while employed with the Company, except as such
violation would not result in a Material Adverse Effect.
“Intellectual
Property” shall mean all patents, patent applications,
trade and service marks, trade and service mark registrations,
trade names, copyrights, licenses, inventions, trade secrets,
technology, know-how and other intellectual property.

 

(p) Insurance. The Company and its
subsidiaries are insured by insurers of recognized financial
responsibility against such losses and risks and in such amounts as
are prudent and customary in the businesses in which the Company
and the subsidiaries are engaged, including, but not limited to,
directors and officers insurance coverage. Neither the Company nor
any subsidiary has any reason to believe that it will not be able
to renew its existing insurance coverage as and when such coverage
expires or to obtain similar coverage from similar insurers as may
be necessary to continue its business without a significant
increase in cost.

 

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

 

(r) Sarbanes-Oxley; Internal Accounting
Controls. The Company and the Subsidiaries are in compliance
with any and all applicable requirements of the Sarbanes-Oxley Act
of 2002 that are effective as of the date hereof, and any and all
applicable rules and regulations promulgated by the Commission
thereunder that are effective as of the date hereof and as of the
Closing Date. The Company and the
Subsidiaries maintain a system of internal accounting controls
sufficient to provide reasonable assurance that: (i) transactions
are executed in accordance with management’s general or
specific authorizations, (ii) transactions are recorded as
necessary to permit preparation of financial statements in
conformity with GAAP and to maintain asset accountability, (iii)
access to assets is permitted only in accordance with
management’s general or specific authorization, and (iv) the
recorded accountability for assets is compared with the existing
assets at reasonable intervals and appropriate action is taken with
respect to any differences. The Company and the Subsidiaries have
established disclosure controls and procedures (as defined in
Exchange Act Rules 13a-15(e) and 15d-15(e)) for the Company and the
Subsidiaries and designed such disclosure controls and procedures
to ensure that information required to be disclosed by the Company
in the reports it files or submits under the Exchange Act is
recorded, processed, summarized and reported, within the time
periods specified in the Commission’s rules and forms. The
Company’s certifying officers have evaluated the
effectiveness of the disclosure controls and procedures of the
Company and the Subsidiaries as of the end of the period covered by
the most recently filed periodic report under the Exchange Act
(such date, the “Evaluation
Date”). The Company
presented in its most recently filed periodic report under the
Exchange Act the conclusions of the certifying officers about the
effectiveness of the disclosure controls and procedures based on
their evaluations as of the Evaluation Date. Since the Evaluation
Date, there have been no changes in the internal control over
financial reporting (as such term is defined in the Exchange Act)
that have materially affected, or is reasonably likely to
materially affect, the internal control over financial reporting of
the Company and its Subsidiaries.

 

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

 

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

 

(u) Investment Company. The Company
is not, and is not an Affiliate of, and immediately after receipt
of payment for the Securities, will not be or be an Affiliate of,
an “investment company” within the meaning of the
Investment Company Act of 1940, as amended. The Company shall
conduct its business in a manner so that it will not become an
“investment company” subject to registration under the
Investment Company Act of 1940, as amended.

 

(v) Registration Rights. Other than
with respect to the Company’s existing registration
statements filed under the Securities Act, or as otherwise
disclosed in the SEC Reports or Schedule 3.1(v) and other than
each of the Purchasers, no Person has any right to cause the
Company or any Subsidiary to effect the registration under the
Securities Act of any securities of the Company or any
Subsidiaries.

 

(w) Listing and Maintenance
Requirements. The Common Stock is registered pursuant to
Section 12(b) or 12(g) of the Exchange Act. The Company has taken
no action designed to, or which to its knowledge is likely to have
the effect of, terminating the registration of the Common Stock
under the Exchange Act nor has the Company received any
notification that the Commission is contemplating terminating such
registration. The Common Stock is currently eligible for electronic
transfer through the Depository Trust Company or another
established clearing corporation and the Company is current in
payment of the fees to the Depository Trust Company (or such other
established clearing corporation) in connection with such
electronic transfer.

 

(x) Disclosure. Except with respect
to the material terms and conditions of the transactions
contemplated by the Transaction Documents, the Company confirms
that neither it nor any other Person acting on its behalf has
provided any of the Purchasers or their agents or counsel with any
information that it believes constitutes or might constitute
material, non-public information. The Company understands and
confirms that the Purchasers will rely on the foregoing
representation in effecting transactions in securities of the
Company. All of the disclosure furnished by or on behalf of the
Company to the Purchasers regarding the Company and its
Subsidiaries, their respective businesses and the transactions
contemplated hereby, including the Disclosure Schedules to this
Agreement, is true and correct and does not contain any untrue
statement of a material fact or omit to state any material fact
necessary in order to make the statements made therein, in the
light of the circumstances under which they were made, not
misleading.

 

(y) Tax Status. Except for matters
that would not, individually or in the aggregate, have or
reasonably be expected to result in a Material Adverse Effect, the
Company and its Subsidiaries each (i) has made or filed all United
States federal, state and local income and all foreign income and
franchise tax returns, reports and declarations required by any
jurisdiction to which it is subject, (ii) has paid all taxes and
other governmental assessments and charges that are material in
amount, shown or determined to be due on such returns, reports and
declarations and (iii) has set aside on its books provision
reasonably adequate for the payment of all material taxes for
periods subsequent to the periods to which such returns, reports or
declarations apply. There are no unpaid taxes in any material
amount claimed to be due by the taxing authority of any
jurisdiction, and the officers of the Company or of any Subsidiary
know of no basis for any such claim.

 

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

 

(aa) Accountants.
The Company’s accounting firm is BDO USA, LLP. To the
knowledge and belief of the Company, such accounting firm (i) is a
registered public accounting firm as required by the Exchange Act
and (ii) shall express its opinion with respect to the financial
statements to be included in the Company’s Annual Report for
the fiscal year ending December 31, 2019.

 

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

 

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

 

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

 

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

 

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

 

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

 

(hh) No
Additional Agreements. The Company has not entered into any
agreement or understanding with any Purchaser or other individual
purchasing Shares with respect to the transactions contemplated
hereby or by any of the other Transaction Documents other than as
specified herein or therein. For the avoidance of doubt, each
Purchaser has the same rights with respect to the purchase of
Shares as each of the other Purchasers other than as explicitly set
forth herein or in any of the other Transaction
Documents.

 

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

 

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

 

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

 

(c) Purchaser Status. At the time
such Purchaser was offered the Securities, it was, and as of the
date hereof it is, and on each date on which it converts any Notes
it will be an “accredited investor” as defined in Rule
501(a)(1), (a)(2), (a)(3), (a)(7) or (a)(8) under the Securities
Act. Such Purchaser is not required to be registered as a
broker-dealer under Section 15 of the Exchange Act.

 

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

 

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

 

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

 

(g) Certain Transactions and
Confidentiality. Other than consummating the transactions
contemplated hereunder, such Purchaser has not, nor has any Person
acting on behalf of or pursuant to any understanding with such
Purchaser, directly or indirectly executed any purchases or sales,
including Short Sales, of the securities of the Company during the
period commencing as of the time that such Purchaser first received
a term sheet (written or oral) from the Company or any other Person
representing the Company setting forth the material terms of the
transactions contemplated hereunder and ending immediately prior to
the execution hereof. The Purchaser
covenants and agrees that neither it, nor any Affiliate acting on
its behalf or pursuant to any understanding with it will execute
any Short Sales of the Common Stock or (ii) hedging transaction,
which establishes a net short position with respect to the
Company’s Common Stock during the period commencing with the
execution of this Agreement and ending on the earlier Maturity Date
(as defined in the Notes) of the Notes or the full repayment or
conversion of the Notes; provided that this provision shall not
prohibit any sales made where a corresponding Notice of Conversion
is tendered to the Company and the shares received upon such
conversion or exercise are used to close out such sale; provided,
further that this provision shall not operate to restrict a
Purchaser’s trading under any prior securities purchase
agreement containing contractual rights that explicitly protects
such trading in respect of the previously issued
securities.

 

 



ARTICLE IV.



OTHER AGREEMENTS OF THE PARTIES

 

4.1 Transfer
Restrictions.

 

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

 

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

 


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

 


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

 

(c) Certificates
evidencing the Underlying Shares shall not contain any legend
(including the legend set forth in Section 4.1(b) hereof): (i)
while a registration statement (including the Registration
Statement) covering the resale of such security is effective under
the Securities Act, (ii) following any sale of such Underlying
Shares pursuant to Rule 144, (iii) if such Underlying Shares are
eligible for sale under Rule 144 or (iv) if such legend is not
required under applicable requirements of the Securities Act
(including judicial interpretations and pronouncements issued by
the staff of the Commission). The Company shall cause its counsel
to issue a legal opinion to the Transfer Agent promptly if required
by the Transfer Agent to effect the removal of the legend
hereunder, provided that the Purchaser has delivered any documents
required by the Company’s counsel in connection therewith
(including any representations, certifications or covenants by the
Purchaser or its broker). If all or any portion of a Note is
converted at a time when there is an effective registration
statement to cover the resale of the Underlying Shares, or if such
Underlying Shares may be sold under Rule 144 without the
requirement for the Company to be in compliance with the current
public information required under Rule 144 as to such Underlying
Shares and without volume or manner-of-sale restrictions or if such
legend is not otherwise required under applicable requirements of
the Securities Act (including judicial interpretations and
pronouncements issued by the staff of the Commission) then such
Underlying Shares shall be issued free of all legends. The Company
agrees that following such time as such legend is no longer
required under this Section 4.1(c), it will, no later than two (2)
Trading Days following the delivery by a Purchaser to the Transfer
Agent of a certificate representing Underlying Shares, as
applicable, issued with a restrictive legend together with such
documents or instruments as may be required by the Transfer Agent
(including any representations, certifications or covenants by the
Purchaser or its broker) (such date, the “Legend Removal Date”),
deliver or cause to be delivered to such Purchaser a certificate
representing such shares that is free from all restrictive and
other legends. The Company may not make any notation on its records
or give instructions to the Transfer Agent that enlarge the
restrictions on transfer set forth in this Section 4. Certificates
for Underlying Shares subject to legend removal hereunder shall be
transmitted by the Transfer Agent to the Purchaser by crediting the
account of the Purchaser’s prime broker with the Depository
Trust Company System as directed by such Purchaser.


 


 

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

 

4.2 Furnishing of Information; Public
Information.

 

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

 


       
       (b)    At any
time during the period commencing from the six (6) month
anniversary of the date hereof and ending at such time that all of
the Securities may be sold without the requirement for the Company
to be in compliance with Rule 144(c)(1) and otherwise without
restriction or limitation pursuant to Rule 144, if the Company (i)
shall fail for any reason to satisfy the current public information
requirement under Rule 144(c) or (ii) has ever been an issuer
described in Rule 144 (i)(1)(i) or becomes such an issuer in the
future, and the Company shall fail to satisfy any condition set
forth in Rule 144(i)(2) (a “Public Information
Failure”) then, in addition to such Purchaser’s
other available remedies, the Company shall pay to a Purchaser, in
cash, as partial liquidated damages and not as a penalty, by reason
of any such delay in or reduction of its ability to sell the
Securities, an amount in cash equal to one percent (1.0%) of the
aggregate Subscription Amount of such Purchaser’s Securities
on the day of a Public Information Failure and on every thirtieth
(30th) day
(pro rated for periods totaling less than thirty days) thereafter
until the earlier of (a) the date such Public Information Failure
is cured and (b) such time that such public information is no
longer required  for the Purchasers to transfer the Underlying
Shares pursuant to Rule 144, up to a maximum of three percent (3%)
of the aggregate Subscription Amount of such Purchaser’s
Securities on the day of a Public Information Failure. The payments
to which a Purchaser shall be entitled pursuant to this Section
4.2(b) are referred to herein as “Public Information Failure
Payments.”  Public Information
Failure Payments shall
be paid on the earlier of (i) the last day of the calendar month
during which such Public Information Failure Payments are incurred and (ii) the
third (3rd) Business Day after
the event or failure giving rise to the Public Information
Failure Payments is
cured.  In the event the Company fails to make Public
Information Failure Payments in a timely manner, such
Public Information Failure Payments shall bear interest at
the rate of 1.5% per month (prorated for partial months) until paid
in full. Nothing herein shall limit such Purchaser’s right to
pursue actual damages for the Public Information Failure, and such
Purchaser shall have the right to pursue all remedies available to
it at law or in equity including, without limitation, a decree of
specific performance and/or injunctive relief.

 

4.3 Conversion Procedures. The form
of Notice of Conversion included in the Notes set forth the totality of the
procedures required of the Purchasers in order to or convert the
Notes. Without limiting the preceding sentences, no ink-original
Notice of Conversion shall be required, nor shall any medallion
guarantee (or other type of guarantee or notarization) of any
Notice of Conversion form be required in order to or convert the
Notes. No additional legal opinion, other information or
instructions shall be required of the Purchasers to convert their
Notes. The Company shall honor conversions of the Notes, subject to
Section 4.9, and shall deliver Underlying Shares in accordance with
the terms, conditions and time periods set forth in the Transaction
Documents.

 

4.4 Securities Laws Disclosure;
Publicity. The Company shall issue a press release (or,
alternatively, a Current Report on Form 8-K) disclosing the
material terms of the transactions contemplated hereby, including
the Transaction Documents as exhibits thereto, with the Commission
within the time required by the Exchange Act. From and after the
issuance of such press release, the Company represents to the
Purchasers that it shall have publicly disclosed all material,
non-public information delivered to any of the Purchasers by the
Company or any of its Subsidiaries, or any of their respective
officers, directors, employees or agents in connection with the
transactions contemplated by the Transaction Documents. In
addition, effective upon the issuance of such press release, the
Company acknowledges and agrees that any and all confidentiality or
similar obligations under any agreement, whether written or oral,
between the Company, any of its Subsidiaries or any of their
respective officers, directors, agents, employees or Affiliates on
the one hand, and any of the Purchasers or any of their Affiliates
on the other hand, shall terminate. The Company and each Purchaser
shall consult with each other in issuing any other press releases
with respect to the transactions contemplated hereby, and neither
the Company nor any Purchaser shall issue any such press release
nor otherwise make any such public statement without the prior
consent of the Company, with respect to any press release of any
Purchaser, or without the prior consent of each Purchaser, with
respect to any press release of the Company, which consent shall
not unreasonably be withheld or delayed, except if such disclosure
is required by law, in which case the disclosing party shall
promptly provide the other party with prior notice of such public
statement or communication. Notwithstanding the foregoing, the
Company shall not publicly disclose the name of any Purchaser, or
include the name of any Purchaser in any filing with the Commission
or any regulatory agency or Trading Market, without the prior
written consent of such Purchaser, except (a) as required by
federal securities law in connection with (i) any registration
statement contemplated by the Registration Rights Agreement and
(ii) the filing of final Transaction Documents with the Commission
and (b) to the extent such disclosure is required by law or Trading
Market regulations, in which case the Company shall provide the
Purchasers with prior notice of such disclosure permitted under
this clause (b).

 

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

 

4.6 Non-Public Information. Except
with respect to the material terms and conditions of the
transactions contemplated by the Transaction Documents, which shall
be disclosed pursuant to Section 4.4, the Company covenants and
agrees that neither it, nor any other Person acting on its behalf
will provide any Purchaser or its agents or counsel with any
information that constitutes, or the Company reasonably believes
constitutes, material non-public information, unless prior thereto
such Purchaser shall have consented to the receipt of such
information and agreed with the Company to keep such information
confidential. The Company understands and confirms that each
Purchaser shall be relying on the foregoing covenant in effecting
transactions in securities of the Company. To the extent that any
notice provided pursuant to any Transaction Document constitutes,
or contains, material, non-public information regarding the Company
or any Subsidiaries, the Company shall simultaneously file such
notice with the Commission pursuant to a Current Report on Form
8-K. The Company understands and confirms that each Purchaser shall
be relying on the foregoing covenant in effecting transactions in
securities of the Company.

 

4.7 Use of Proceeds. The Company
shall use the net proceeds from the sale of the Securities
hereunder for working capital purposes and shall not use such
proceeds for: (a) the redemption of any Common Stock or Common
Stock Equivalents or (b) the settlement of any outstanding
litigation.

 

4.8 Indemnification of Purchasers.
Subject to the provisions of this Section 4.8, the Company will
indemnify and hold each Purchaser and its directors, officers,
shareholders, members, partners, employees and agents (and any
other Persons with a functionally equivalent role of a Person
holding such titles notwithstanding a lack of such title or any
other title), each Person who controls such Purchaser (within the
meaning of Section 15 of the Securities Act and Section 20 of the
Exchange Act), and the directors, officers, shareholders, agents,
members, partners or employees (and any other Persons with a
functionally equivalent role of a Person holding such titles
notwithstanding a lack of such title or any other title) of such
controlling persons (each, a “Purchaser Party”)
harmless from any and all losses, liabilities, obligations, claims,
contingencies, damages, costs and expenses, including all
judgments, amounts paid in settlements, court costs and reasonable
attorneys’ fees and costs of investigation that any such
Purchaser Party may suffer or incur as a result of or relating to
(a) any breach of any of the representations, warranties, covenants
or agreements made by the Company in this Agreement or in the other
Transaction Documents or (b) any action instituted against the
Purchaser Parties in any capacity, or any of them or their
respective Affiliates, by any stockholder of the Company who is not
an Affiliate of such Purchaser Party, with respect to any of the
transactions contemplated by the Transaction Documents (unless such
action is solely based upon a material breach of such Purchaser
Party’s representations, warranties or covenants under the
Transaction Documents or any agreements or understandings such
Purchaser Party may have with any such stockholder or any
violations by such Purchaser Party of state or federal securities
laws or any conduct by such Purchaser Party which is finally
judicially determined to constitute fraud, gross negligence or
willful misconduct). If any action shall be brought against any
Purchaser Party in respect of which indemnity may be sought
pursuant to this Agreement, such Purchaser Party shall promptly
notify the Company in writing, and the Company shall have the right
to assume the defense thereof with counsel of its own choosing
reasonably acceptable to the Purchaser Party. Any Purchaser Party
shall have the right to employ separate counsel in any such action
and participate in the defense thereof, but the fees and expenses
of such counsel shall be at the expense of such Purchaser Party
except to the extent that (i) the employment thereof has been
specifically authorized by the Company in writing, (ii) the Company
has failed after a reasonable period of time to assume such defense
and to employ counsel or (iii) in such action there is, in the
reasonable opinion of counsel, a material conflict on any material
issue between the position of the Company and the position of such
Purchaser Party, in which case the Company shall be responsible for
the reasonable fees and expenses of no more than one such separate
counsel. The Company will not be liable to any Purchaser Party
under this Agreement (y) for any settlement by a Purchaser Party
effected without the Company’s prior written consent, which
shall not be unreasonably withheld or delayed; or (z) to the
extent, but only to the extent that a loss, claim, damage or
liability is attributable to any Purchaser Party’s breach of
any of the representations, warranties, covenants or agreements
made by such Purchaser Party in this Agreement or in the other
Transaction Documents.

 

4.9  Reservation of Securities. As
of the date hereof, the Company has reserved, free of preemptive
rights, that number of shares of Common Stock equal to the Required
Minimum for the purpose of enabling the Company to issue Shares
pursuant to this Agreement. Any conversion rights or other rights
to receive shares that the Holder(s) have either under this
Agreement or in the Notes will be conditioned on the Company having
available sufficient authorized shares in excess of the outstanding
and reserved shares outlined in Schedule 3.1(f).

 

4.10 Listing
of Common Stock. The Company hereby agrees to use best
efforts to maintain the listing or quotation of the Common Stock on
the Trading Market on which it is currently listed, and
concurrently with the Closing, if required, the Company shall apply
to list or quote all of the Shares on such Trading Market. The
Company further agrees, if the Company applies to have the Common
Stock traded on any other Trading Market, it will then include in
such application all of the Shares, and will take such other action
as is necessary to cause all of the Shares to be listed on such
other Trading Market as promptly as possible. The Company will then
take all action reasonably necessary to continue the listing or
quotation and trading of its Common Stock on a Trading Market and
will comply in all respects with the Company’s reporting,
filing and other obligations under the bylaws or rules of the
Trading Market. The Company agrees to maintain the eligibility of
the Common Stock for electronic transfer through the Depository
Trust Company or another established clearing corporation,
including, without limitation, by timely payment of fees to the
Depository Trust Company or such other established clearing
corporation in connection with such electronic
transfer.

 

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

 

4.12 Certain
Transactions and Confidentiality. Each Purchaser, severally
and not jointly with the other Purchasers, covenants that neither
it, nor any Affiliate acting on its behalf or pursuant to any
understanding with it will execute any purchases or sales,
including Short Sales, of any of the Company’s securities
during the period commencing with the execution of this Agreement
and ending at such time that the transactions contemplated by this
Agreement are first publicly announced pursuant to the initial
press release as described in Section 4.4.  Each Purchaser,
severally and not jointly with the other Purchasers, covenants that
until such time as the transactions contemplated by this Agreement
are publicly disclosed by the Company pursuant to the initial press
release as described in Section 4.4, such Purchaser will maintain
the confidentiality of the existence and terms of this transaction
and the information included in the Disclosure Schedules.
Notwithstanding the foregoing, and notwithstanding anything
contained in this Agreement to the contrary (except for Section
3.2(g)), the Company expressly acknowledges and agrees that (i) no
Purchaser makes any representation, warranty or covenant hereby
that it will not engage in effecting transactions in any securities
of the Company after the time that the transactions contemplated by
this Agreement are first publicly announced pursuant to the initial
press release as described in Section 4.4, (ii) no Purchaser shall
be restricted or prohibited from effecting any transactions in any
securities of the Company in accordance with applicable securities
laws from and after the time that the transactions contemplated by
this Agreement are first publicly announced pursuant to the initial
press release as described in Section 4.4 and (iii) no Purchaser
shall have any duty of confidentiality or duty not to trade in the
securities of the Company to the Company or its Subsidiaries after
the issuance of the initial press release as described in Section
4.4. 

 

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

 

 



ARTICLE V.



MISCELLANEOUS

 

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

 

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

 

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

 

5.4 Notices. Any and all notices or
other communications or deliveries required or permitted to be
provided hereunder shall be in writing and shall be deemed given
and effective on the earliest of: (a) the date of transmission, if
such notice or communication is delivered via facsimile at the
facsimile number or email attachment at the email address as set
forth on the signature pages attached hereto at or prior to 5:30
p.m. (New York City time) on a Trading Day, (b) the next Trading
Day after the date of transmission, if such notice or communication
is delivered via facsimile at the facsimile number or email
attachment as set forth on the signature pages attached hereto on a
day that is not a Trading Day or later than 5:30 p.m. (New York
City time) on any Trading Day, (c) the second (2nd) Trading Day
following the date of mailing, if sent by U.S. nationally
recognized overnight courier service or (d) upon actual receipt by
the party to whom such notice is required to be given. The address
for such notices and communications shall be as set forth on the
signature pages attached hereto. To the extent that any notice
provided pursuant to any Transaction Document constitutes, or
contains, material, non-public information regarding the Company or
any of the Subsidiaries, the Company shall simultaneously file such
notice with the Commission pursuant to a Current Report on Form
8-K.

 

5.5 Amendments; Waivers. No
provision of this Agreement may be waived, modified, supplemented
or amended except in a written instrument signed, in the case of an
amendment, by the Company and Purchasers which purchased at least
51% in interest of the Notes based on the initial Subscription
Amounts hereunder or, in the case of a waiver, by the party against
whom enforcement of any such waived provision is sought, provided
that if any amendment, modification or waiver disproportionately
and adversely impacts a Purchaser (or group of Purchasers), the
consent of such disproportionately impacted Purchaser (or group of
Purchasers) shall also be required. No waiver of any default with
respect to any provision, condition or requirement of this
Agreement shall be deemed to be a continuing waiver in the future
or a waiver of any subsequent default or a waiver of any other
provision, condition or requirement hereof, nor shall any delay or
omission of any party to exercise any right hereunder in any manner
impair the exercise of any such right. Any proposed amendment or
waiver that disproportionately, materially and adversely affects
the rights and obligations of any Purchaser relative to the
comparable rights and obligations of the other Purchasers shall
require the prior written consent of such adversely affected
Purchaser. Any amendment effected in accordance with this Section
5.5 shall be binding upon each Purchaser and holder of Securities
and the Company.

 

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

 

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

 

5.8 No Third-Party Beneficiaries.
This Agreement is intended for the benefit of the parties hereto
and their respective successors and permitted assigns and is not
for the benefit of, nor may any provision hereof be enforced by,
any other Person, except as otherwise set forth in Section
4.8.

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 


 

 



(Signature Pages Follow)

 


 







 











 






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

 


	


PARKERVISION, INC.


 


 

	

Address
for Notice:


7915
Baymeadows Way


Suite
400


Jacksonville,
FL 32256


	

By:__________________________________________


     Name:
Jeffrey Parker


     Title:
Chief Executive Officer


 


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

	

Email:
cpoehlman@parkervision.com


jparker@parkervision.com


Fax:
904-330-0111


	

Graubard
Miller


The
Chrysler Building


405
Lexington Avenue, 11th Floor


New
York, NY 10174


Attention:
David Alan Miller, Esq.


Fax:
(212) 818-8881


 


 


 

	
 







 


[REMAINDER
OF PAGE INTENTIONALLY LEFT BLANK


SIGNATURE
PAGE FOR PURCHASER FOLLOWS]

 


 







 











 






[PURCHASER
SIGNATURE PAGES TO PRKR SECURITIES PURCHASE AGREEMENT]


 


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

 


Name of
Purchaser:
________________________________________________________


Signature of Authorized Signatory of
Purchaser: _________________________________


Name of
Authorized Signatory:
_______________________________________________


Title
of Authorized Signatory:
________________________________________________



Email Address of
Authorized Signatory:
________________________________________






Facsimile Number of
Authorized Signatory:
_____________________________________


Address
for Notice to Purchaser:


 


 


 


 


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


 


 


 


 


 


 


 



Subscription
Amount:
$_____________                                     








 


EIN
Number: _______________________