Exhibit
10.1


 





FORM OF SECURITIES
PURCHASE AGREEMENT


 


This
SECURITIES PURCHASE AGREEMENT (this “Agreement”), dated as of April 2, 2020, is by and among Sigma Labs,
Inc., a Nevada corporation with headquarters located at 3900 Paseo del Sol, Santa Fe, NM 87507 (the “Company”),
and each of the investors listed on the Schedule of Buyers attached hereto (individually, a “Buyer” and collectively,
the “Buyers”).


 


RECITALS


 


A.
The Company and each Buyer desire to enter into this transaction to purchase (A) Series A Warrants (as defined below) in reliance
upon the exemption from securities registration afforded by Section 4(a)(2) of the 1933 Act, and Rule 506(b) of Regulation D (“Regulation
D”) as promulgated by the United States Securities and Exchange Commission (the “SEC”) under the
Securities Act of 1933, as amended (the “1933 Act”), and (B) (i) the Common Shares (as defined below), and
(ii) Series B Warrants (as defined below) pursuant to a currently effective shelf registration statement on Form S-3, which has
at least $1,500,000 of unallocated securities, including Common Stock (as defined below) and warrants to purchase Common Stock
registered thereunder (Registration Number 333-225377) (the “Registration Statement”), which Registration Statement
has been declared effective in accordance with the 1933 Act, by the SEC.


 


B.
Each Buyer wishes to purchase, and the Company wishes to sell, upon the terms and conditions stated in this Agreement, (i) such
aggregate number of shares of Common Stock as set forth opposite such Buyer’s name in column (3) on the Schedule of Buyers
(which aggregate amount for all Buyers shall be 493,027 shares of Common Stock and shall collectively be referred to herein as
the “Common Shares”), a Series A Warrant to initially acquire up to such aggregate number of shares of Common
Stock set forth opposite such Buyer’s name in column (4) on the Schedule of Buyers, as evidenced by a certificate in the
form attached hereto as Exhibit A-1 (the “Series A Warrants”) (as exercised, collectively, the
“Series A Warrant Shares”) and (iii) a Series B Warrant to initially acquire up to such aggregate number of
shares of Common Stock set forth opposite such Buyer’s name in column (5) on the Schedule of Buyers, as evidenced by a certificate
in the form attached hereto as Exhibit A-2 (the “Series B Warrants”, and together with the Series
A Warrants, the “Warrants”) (as exercised, collectively, the “Series B Warrant Shares”,
and together with the Series A Warrant Shares, the “Warrant Shares”).


 


C.
The Series A Warrants and the Series A Warrant Shares are collectively referred to herein as the “PIPE Securities”.
The Common Shares, the Series B Warrants and the Series B Warrant Shares are collectively referred to herein as the “RD
Securities”. The PIPE Securities and the RD Securities are collectively referred to herein as the “Securities”.


 




    	 	 	 



     


    

 


AGREEMENT


 


NOW,
THEREFORE, in consideration of the premises and the mutual covenants contained herein and for other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, the Company and each Buyer hereby agree as follows:



 


1.
PURCHASE AND SALE OF COMMON SHARES AND
WARRANTS.


 


(a)
Purchase of Common Shares and Warrants. Subject to the satisfaction (or waiver) of the conditions set forth in Sections
6 and 7 below, the Company shall issue and sell to each Buyer, and each Buyer severally, but not jointly, agrees to purchase from
the Company on the Closing Date (as defined below) (A) such aggregate number of Common Shares as is set forth opposite such Buyer’s
name in column (3) on the Schedule of Buyers, (B) Series A Warrants to initially acquire up to that aggregate number of Series
A Warrant Shares as is set forth opposite such Buyer’s name in column (4) on the Schedule of Buyers and (C) Series B Warrants
to initially acquire up to such aggregate number of Series B Warrant Shares as is set forth opposite such Buyer’s name in
column (5) on the Schedule of Buyers.


 


(b)
Closing. The closing (the “Closing”) of the purchase of the Common Shares and the Warrants by the Buyers
shall occur at the offices of Kelley Drye & Warren LLP, 101 Park Avenue, New York, NY 10178. The date and time of the Closing
(the “Closing Date”) shall be 10:00 a.m., New York time, on the first (1st) Business Day (as defined below)
on which the conditions to the Closing set forth in Sections 6 and 7 below are satisfied or waived (or such other date as is mutually
agreed to by the Company and each Buyer). As used herein “Business Day”
means any day, other than a Saturday, a Sunday, or a day on which commercial banking
or trust institutions in New York City, New York are authorized or obligated by law or executive order to close; provided that
banks shall not be deemed to be authorized or obligated to be closed due to a “shelter in place,” “non-essential
employee” or similar closure of physical branch locations at the direction of any governmental authority if such banks’
electronic funds transfer systems (including for wire transfers) are open for use by customers on such day.


 


(c)
Purchase Price. The aggregate purchase price for the Common Shares and the Warrants to be purchased by each Buyer (the
“Purchase Price”) shall be the amount set forth opposite such Buyer’s name in column (6) on the Schedule
of Buyers.


 


(d)
Form of Payment; Deliveries. On the Closing Date, (i) each Buyer shall pay its respective Purchase Price to the Company
for the Common Shares and the Warrants to be issued and sold to such Buyer at the Closing, by wire transfer of immediately available
funds in accordance with the Flow of Funds Letter (as defined below) (less, in the case of the lead Buyer, the amounts withheld
pursuant to Section 4(i)) and (ii) the Company shall (A) cause Issuer Direct Corporation (together with any subsequent transfer
agent, the “Transfer Agent”) through the Depository Trust Company (“DTC”) Fast Automated
Securities Transfer Program, to credit such aggregate number of Common Shares that each Buyer is purchasing as is set forth opposite
such Buyer’s name in column (3) of the Schedule of Buyers to such Buyer’s or its designee’s balance account
with DTC through its Deposit/Withdrawal at Custodian system, and (B) deliver to each Buyer (x) a Series A Warrant pursuant to
which such Buyer shall have the right to initially acquire up to that aggregate number of Series A Warrant Shares as is set forth
opposite such Buyer’s name in column (4) on the Schedule of Buyers and (y) a Series B Warrant pursuant to which such Buyer
shall have the right to initially acquire up to such aggregate number of Series B Warrant Shares as is set forth opposite such
Buyer’s name in column (5) on the Schedule of Buyers, in each case, duly executed on behalf of the Company and registered
in the name of such Buyer or its designee.


 




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2.
BUYER’S REPRESENTATIONS AND WARRANTIES.


 


Each
Buyer, severally and not jointly, represents and warrants to the Company with respect to only itself that, as of the date hereof
and as of the Closing Date:


 


(a)
Organization; Authority. Such Buyer is an entity duly organized, validly existing and in good standing under the laws of
the jurisdiction of its organization with the requisite power and authority to enter into and to consummate the transactions contemplated
by the Transaction Documents (as defined below) to which it is a party and otherwise to carry out its obligations hereunder and
thereunder.


 


(b)
No Public Sale or Distribution. Such Buyer (i) is acquiring its Series A Warrants, and (ii) upon exercise of its Series
A Warrants (other than pursuant to a Cashless Exercise (as defined in the Series A Warrants)) will acquire the Series A Warrant
Shares issuable upon exercise thereof, in each case, for its own account and not with a view towards, or for resale in connection
with, the public sale or distribution thereof in violation of applicable securities laws, except pursuant to sales registered
or exempted under the 1933 Act; provided, however, by making the representations herein, such Buyer does not agree, or make any
representation or warranty, to hold any of the Securities for any minimum or other specific term and reserves the right to dispose
of the Securities at any time in accordance with or pursuant to a registration statement or an exemption from registration under
the 1933 Act. Such Buyer does not presently have any agreement or understanding, directly or indirectly, with any Person to distribute
any of the Securities in violation of applicable securities laws. For purposes of this Agreement, “Person”
means an individual, a limited liability company, a partnership, a joint venture, a corporation, a trust, an unincorporated organization,
any other entity and any Governmental Entity or any department or agency thereof.


 


(c)
Accredited Investor or Other Qualified Status. Such Buyer is a “qualified institutional investor” as defined
in Rule 144A of the 1933 Act, an institutional accredited investor of a type listed in subsection (1), (2), (3), (7) or (8) of
Rule 501(a) of Regulation D, with a substantive, pre-existing relationship with the Company, or a “Qualified Investor”
within the meaning of Directive 2003/71/EC of the European Parliament and of the Council of November 4, 2003 (as amended to date,
the “Prospectus Directive,” including any implementing legislation in the United Kingdom), and/or a person who is
(a) an investment professional falling within articles 19(5) of the Financial Services and Markets Act 2000 (“FSMA”)
(Financial Promotion) Order 2005, as amended (the “Order”); (b) a person falling within article 49(2)(a) to
(d) “high net worth companies, unincorporated associations etc.” of the Order; or (c) a person to whom an invitation
or inducement to engage in investment activity (within the meaning of Section 21 of the FSMA) in connection with the issue or
sale of any securities may otherwise be lawfully communicated or caused to be communicated. In the case of a Buyer situated in
a member state of the European Economic Area (“EEA”), such Buyer is a person to whom an offer of the Securities
may be made without registration or delivery of a prospectus under an applicable exception under the national legislation of the
relevant member state of the EEA implementing the Prospectus Directive.


 




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


 


(e)
Information. Such Buyer and its advisors, if any, have been furnished with all materials relating to the business, finances
and operations of the Company and materials relating to the offer and sale of the Securities that have been requested by such
Buyer. Such Buyer and its advisors, if any, have been afforded the opportunity to ask questions of the Company. Neither such inquiries
nor any other due diligence investigations conducted by such Buyer or its advisors, if any, or its representatives shall modify,
amend or affect such Buyer’s right to rely on the Company’s representations and warranties contained herein. Such
Buyer understands that its investment in the Securities involves a high degree of risk. Such Buyer has sought such accounting,
legal and tax advice as it has considered necessary to make an informed investment decision with respect to its acquisition of
the Securities.


 


(f)
No Governmental Review. Such Buyer understands that no United States federal or state agency or any other government or
governmental agency has passed on or made any recommendation or endorsement of the Securities or the fairness or suitability of
the investment in the Securities nor have such authorities passed upon or endorsed the merits of the offering of the Securities.


 


(g)
Transfer or Resale. Such Buyer understands that except as provided in Section 4(j) hereof: (i) the PIPE Securities have
not been and are not being registered under the 1933 Act or any state securities laws, and may not be offered for sale, sold,
assigned or transferred unless (A) subsequently registered thereunder, (B) such Buyer shall have delivered to the Company (if
requested by the Company) an opinion of counsel, in a form reasonably acceptable to the Company, to the effect that such PIPE
Securities to be sold, assigned or transferred may be sold, assigned or transferred pursuant to an exemption from such registration,
or (C) such Buyer provides the Company with reasonable assurance that such PIPE Securities can be sold, assigned or transferred
pursuant to Rule 144 or Rule 144A promulgated under the 1933 Act (or a successor rule thereto) (collectively, “Rule 144”);
(ii) any sale of the PIPE Securities made in reliance on Rule 144 may be made only in accordance with the terms of Rule 144, and
further, if Rule 144 is not applicable, any resale of the PIPE Securities under circumstances in which the seller (or the Person
through whom the sale is made) may be deemed to be an underwriter (as that term is defined in the 1933 Act) may require compliance
with some other exemption under the 1933 Act or the rules and regulations of the SEC promulgated thereunder; and (iii) neither
the Company nor any other Person is under any obligation to register the PIPE Securities under the 1933 Act or any state securities
laws or to comply with the terms and conditions of any exemption thereunder. Notwithstanding the foregoing, the PIPE Securities
may be pledged in connection with a bona fide margin account or other loan or financing arrangement secured by the PIPE Securities
and such pledge of PIPE Securities shall not be deemed to be a transfer, sale or assignment of the PIPE Securities hereunder,
and no Buyer effecting a pledge of PIPE Securities shall be required to provide the Company with any notice thereof or otherwise
make any delivery to the Company pursuant to this Agreement or any other Transaction Document (as defined in Section 3(b)), including,
without limitation, this Section 2(f).


 




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(h)
Validity; Enforcement. This Agreement have been duly and validly authorized, executed and delivered on behalf of such Buyer
and shall constitute the legal, valid and binding obligations of such Buyer enforceable against such Buyer in accordance with
their respective terms, except as such enforceability may be limited by general principles of equity or to applicable bankruptcy,
insolvency, reorganization, moratorium, liquidation and other similar laws relating to, or affecting generally, the enforcement
of applicable creditors’ rights and remedies.


 


(i)
No Conflicts. The execution, delivery and performance by such Buyer of this Agreement and the consummation by such Buyer
of the transactions contemplated hereby and thereby will not (i) result in a violation of the organizational documents of such
Buyer, or (ii) conflict with, or constitute a default (or an event which with notice or lapse of time or both would become a default)
under, or give to others any rights of termination, amendment, acceleration or cancellation of, any agreement, indenture or instrument
to which such Buyer is a party, or (iii) result in a violation of any law, rule, regulation, order, judgment or decree (including
federal and state securities laws) applicable to such Buyer, except in the case of clauses (ii) and (iii) above, for such conflicts,
defaults, rights or violations which could not, individually or in the aggregate, reasonably be expected to have a material adverse
effect on the ability of such Buyer to perform its obligations hereunder.


 


(j)
Receipt of Prospectus Supplement. Such Buyer acknowledges receipt of the Company’s Prospectus Supplement relating
to the offering of the RD Securities, which Prospectus Supplement is required to be delivered to such Buyer pursuant to Section
4(c) below. Such Buyer acknowledges that it has had an opportunity to review the Prospectus Supplement prior to committing to
purchase any of the RD Securities.


 


(k)
No Group. Other than affiliates of such Buyer who are also Buyers under this Agreement, such Buyer is not under common
control with or acting in concert with any other Buyer and is not part of a “group” for purposes of the 1934 Act.


 


(l)
Residency. Such Buyer is a resident of that jurisdiction specified below its address of the Schedule of Buyers.


 




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3.
                                         REPRESENTATIONS
                                         AND WARRANTIES OF THE COMPANY.


 


The
Company represents and warrants to each of the Buyers that, as of the date hereof and as of the Closing Date:


 


(a)
Organization and Qualification. Each of the Company and each of its Subsidiaries are entities duly organized and validly
existing and in good standing under the laws of the jurisdiction in which they are formed, and have the requisite power and authority
to own their properties and to carry on their business as now being conducted and as presently proposed to be conducted. Each
of the Company and each of its Subsidiaries is duly qualified as a foreign entity to do business and is in good standing in every
jurisdiction in which its ownership of property or the nature of the business conducted by it makes such qualification necessary,
except to the extent that the failure to be so qualified or be in good standing would not reasonably be expected to have a Material
Adverse Effect (as defined below). As used in this Agreement, “Material Adverse Effect” means any material
adverse effect on (i) the business, properties, assets, liabilities, operations (including results thereof), condition (financial
or otherwise) or prospects of the Company or any Subsidiary, individually or taken as a whole, (ii) the transactions contemplated
hereby or in any of the other Transaction Documents or any other agreements or instruments to be entered into in connection herewith
or therewith or (iii) the authority or ability of the Company or any of its Subsidiaries to perform any of their respective obligations
under any of the Transaction Documents (as defined below). Other than the Persons (as defined below) set forth on Schedule 3(a)
the Company has no Subsidiaries. “Subsidiaries” means any Person in which the Company, directly or indirectly,
(A) owns any of the outstanding capital stock or holds any equity or similar interest of such Person or (B) controls or operates
all or any part of the business, operations or administration of such Person, and each of the foregoing, is individually referred
to herein as a “Subsidiary”.


 



(b)
Authorization; Enforcement; Validity. The Company has the requisite power and authority to enter into and perform its obligations
under this Agreement and the other Transaction Documents and to issue the Securities in accordance with the terms hereof and thereof.
The execution and delivery of this Agreement and the other Transaction Documents by the Company and the consummation by the Company
of the transactions contemplated hereby and thereby (including, without limitation, the issuance of the Common Shares, the issuance
of the Warrants and the reservation for issuance and issuance of the Warrant Shares issuable upon exercise of the Warrants) have
been duly authorized by the Company’s board of directors and (other than the filing with the SEC of (i) a Form D, (ii) the
8-K Filing (as defined below), and (iii) a prospectus supplement in connection with the Closing as required by the Registration
Statement pursuant to Rule 424(b) under the 1933 Act (the “Prospectus Supplement”) supplementing the base prospectus
forming part of the Registration Statement (the “Prospectus”) and any other filings as may be required by any
state securities agencies (collectively, the “Required Approvals”)) and no further filing, consent or authorization
is required by the Company, its board of directors or its shareholders or other governing body. This Agreement has been, and the
other Transaction Documents to which it is a party will be prior to the Closing, duly executed and delivered by the Company, and
each constitutes the legal, valid and binding obligations of the Company, enforceable against the Company in accordance with its
respective terms, except as such enforceability may be limited by general principles of equity or applicable bankruptcy, insolvency,
reorganization, moratorium, liquidation or similar laws relating to, or affecting generally, the enforcement of applicable creditors’
rights and remedies and except as rights to indemnification and to contribution may be limited by federal or state securities
law. “Transaction Documents” means, collectively, this Agreement, the Common Shares, the Warrants, the Irrevocable
Transfer Agent Instructions (as defined below) and each of the other agreements and instruments entered into or delivered by any
of the parties hereto in connection with the transactions contemplated hereby and thereby, as may be amended from time to time.


 






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(c)
Issuance of Securities; Registration Statement. The issuance of the Common Shares and the Warrants are duly authorized
and, upon issuance and payment in accordance with the terms of the Transaction Documents shall be validly issued, fully paid and
non-assessable and free from all preemptive or similar rights, mortgages, defects, claims, liens, pledges, charges, taxes, rights
of first refusal, encumbrances, security interests and other encumbrances (collectively “Liens”) with respect
to the issuance thereof. As of the Closing, the Company shall have reserved from its duly authorized capital stock not less than
100% of the maximum number of shares of Common Stock issuable upon exercise of the Warrants (without taking into account any limitations
on the exercise of the Warrants set forth in the Warrants). Upon exercise in accordance with the Warrants, the Warrant Shares,
when issued, will be validly issued, fully paid and nonassessable and free from all preemptive or similar rights or Liens with
respect to the issue thereof, with the holders being entitled to all rights accorded to a holder of Common Stock. Subject to the
accuracy of the representations and warranties of the Buyers in this Agreement, the offer and issuance by the Company of the PIPE
Securities is exempt from registration under the 1933 Act. The issuance by the Company of the RD Securities has been registered
under the 1933 Act, the RD Securities are being issued pursuant to the Registration Statement and all of the RD Securities are
freely transferable and freely tradable by each of the Buyers without restriction, whether by way of registration or some exemption
therefrom. The Registration Statement is effective and available for the issuance of the RD Securities thereunder and the Company
has not received any notice that the SEC has issued or intends to issue a stop-order with respect to the Registration Statement
or that the SEC otherwise has suspended or withdrawn the effectiveness of the Registration Statement, either temporarily or permanently,
or intends or has threatened in writing to do so. The “Plan of Distribution” section under the Registration Statement
(including the Prospectus Supplement) permits the issuance and sale of the RD Securities hereunder and as contemplated by the
other Transaction Documents. Upon receipt of the RD Securities, each of the Buyers will have acquire ownership of the RD Securities
free of any adverse claim. The Registration Statement and any prospectus included therein, including the Prospectus and the Prospectus
Supplement, complied in all material respects with the requirements of the 1933 Act, and the documents incorporated by reference
into the Registration Statement when filed, complied in all material respects with the requirements of the 1934 Act and, in each
case, with the rules and regulations of the SEC promulgated under the 1933 Act or the 1934 Act, as the case may be. At the time
the Registration Statement and any amendments thereto became effective the Registration Statement and any amendments thereto complied
and, upon the filing of the Prospectus Supplement after the date of this Agreement the Registration Statement will comply. in
all material respects with the requirements of the 1933 Act and did not and will not contain any untrue statement of a material
fact or omit to state any material fact required to be stated therein or necessary to make the statements therein not misleading.
The Prospectus and any amendments or supplements thereto, at the time the Prospectus or any amendment or supplement thereto was
issued and the Prospectus Supplement at the Closing Date, complied and will comply, as the case may be, in all material respects
with the requirements of the 1933 Act and did not, and will not, contain any untrue statement of a material fact or omit to state
a material fact necessary in order to make the statements therein, in light of the circumstances under which they were made, not
misleading. The Company meets all of the requirements of General Instruction I.B.6 for the use of Form S-3 under the 1933 Act
for the offering and sale of the RD Securities contemplated by this Agreement and the other Transaction Documents, and the SEC
has not notified the Company of any objection to the use of the form of the Registration Statement pursuant to Rule 401(g)(1)
under the 1933 Act. The Registration Statement meets the requirements set forth in Rule 415(a)(1)(x) under the 1933 Act. At the
earliest time after the filing of the Registration Statement that the Company or another offering participant made a bona fide
offer (within the meaning of Rule 164(h)(2) under the 1933 Act) relating to any of the RD Securities, the Company was not and
is not an “Ineligible Issuer” (as defined in Rule 405 under the 1933 Act). The Company (i) has not distributed any
offering material in connection with the offer or sale of any of the RD Securities and (ii) until no Buyer holds any of the RD
Securities, shall not distribute any offering material in connection with the offer or sale of any of the RD Securities to, or
by, any of the Buyers (if required), in each case, other than the Registration Statement, the Prospectus or the Prospectus Supplement.
In accordance with Rule 5110(b)(7)(C)(i) of the Financial Industry Regulatory Authority Manual, the offering of the Securities
has been registered with the SEC on Form S-3 under the 1933 Act pursuant to the standards for Form S-3 in effect prior to October
21, 1992, and the RD Securities are being offered pursuant to Rule 415 promulgated under the 1933 Act.


 




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(d)
No Conflicts. The execution, delivery and performance of the Transaction Documents by the Company and the consummation
by the Company of the transactions contemplated hereby and thereby (including, without limitation, the issuance of the Common
Shares, the Warrants and the Warrant Shares and the reservation for issuance of the Warrant Shares) will not (i) result in a violation
of the Articles of Incorporation (as defined below) (including, without limitation, any certificate of designation contained therein),
Bylaws (as defined below), certificate of formation, memorandum of association, articles of association, bylaws or other organizational
documents of the Company or any of its Subsidiaries, or any capital stock or other securities of the Company or any of its Subsidiaries,
(ii) conflict with, or constitute a default (or an event which with notice or lapse of time or both would become a default) in
any respect under, or give to others any rights of termination, amendment, acceleration or cancellation of, any agreement, indenture
or instrument to which the Company or any of its Subsidiaries is a party, or (iii) result in a violation of any law, rule, regulation,
order, judgment or decree (including, without limitation, foreign, federal and state securities laws and regulations and the rules
and regulations of the Nasdaq Capital Market (the “Principal Market”) and including all applicable foreign,
federal and state laws, rules and regulations) applicable to the Company or any of its Subsidiaries or by which any property or
asset of the Company or any of its Subsidiaries is bound or affected.


 


(e)
Consents. Neither the Company nor any Subsidiary is required to obtain any consent from, authorization or order of, or
make any filing or registration with (other than the Required Approvals), any Governmental Entity (as defined below) or any regulatory
or self-regulatory agency or any other Person in order for it to execute, deliver or perform any of its respective obligations
under or contemplated by the Transaction Documents, in each case, in accordance with the terms hereof or thereof. All consents,
authorizations, orders, filings and registrations which the Company or any Subsidiary is required to obtain pursuant to the preceding
sentence have been or will be obtained or effected on or prior to the Closing Date, and neither the Company nor any of its Subsidiaries
are aware of any facts or circumstances which might prevent the Company or any of its Subsidiaries from obtaining or effecting
any of the registration, application or filings contemplated by the Transaction Documents. Except as disclosed in the SEC Documents,
the Company is not in violation of the requirements of the Principal Market and has no knowledge of any facts or circumstances
which could reasonably lead to delisting or suspension of the Common Stock in the foreseeable future. “Governmental Entity”
means any nation, state, county, city, town, village, district, or other political jurisdiction of any nature, federal, state,
local, municipal, foreign, or other government, governmental or quasi-governmental authority of any nature (including any governmental
agency, branch, department, official, or entity and any court or other tribunal), multi-national organization or body; or body
exercising, or entitled to exercise, any administrative, executive, judicial, legislative, police, regulatory, or taxing authority
or power of any nature or instrumentality of any of the foregoing, including any entity or enterprise owned or controlled by a
government or a public international organization or any of the foregoing.


 




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(f)
Acknowledgment Regarding Buyer’s Purchase of Securities. The Company acknowledges and agrees that each Buyer is acting
solely in the capacity of an arm’s length purchaser with respect to the Transaction Documents and the transactions contemplated
hereby and thereby and that no Buyer is (i) an officer or director of the Company or any of its Subsidiaries, (ii) an “affiliate”
(as defined in Rule 144) of the Company or any of its Subsidiaries or (iii) to its knowledge, a “beneficial owner”
of more than 10% of the shares of Common Stock (as defined for purposes of Rule 13d-3 of the Securities Exchange Act of 1934,
as amended (the “1934 Act”)). The Company further acknowledges that no Buyer is acting as a financial advisor
or fiduciary of the Company or any of its Subsidiaries (or in any similar capacity) with respect to the Transaction Documents
and the transactions contemplated hereby and thereby, and any advice given by a Buyer or any of its representatives or agents
in connection with the Transaction Documents and the transactions contemplated hereby and thereby is merely incidental to such
Buyer’s purchase of the Securities. The Company further represents to each Buyer that the Company’s decision to enter
into the Transaction Documents to which it is a party has been based solely on the independent evaluation by the Company and its
respective representatives.


 


(g)
No General Solicitation; Placement Agent’s Fees. Neither the Company, nor any of its Subsidiaries or affiliates,
nor any Person acting on its or their behalf, has engaged in any form of general solicitation or general advertising (within the
meaning of Regulation D) in connection with the offer or sale of the Securities. The Company shall be responsible for the payment
of any placement agent’s fees, financial advisory fees, or brokers’ commissions (other than for Persons
engaged by any Buyer or its investment advisor) relating to or arising out of the transactions contemplated hereby, including,
without limitation, placement agent fees payable to Dawson James Securities Inc., as placement agent (the “Placement
Agent”) in connection with the sale of the Securities. The fees and expenses of the Placement Agent to be paid by the
Company or any of its Subsidiaries are as set forth on Schedule 3(f) attached hereto. The Company shall pay, and hold each Buyer
harmless against, any liability, loss or expense (including, without limitation, attorney’s fees and out-of-pocket
expenses) arising in connection with any such claim. The Company acknowledges that it has engaged the Placement Agent in connection
with the sale of the Securities. Other than the Placement Agent, neither the Company nor any of its Subsidiaries has engaged any
placement agent or other agent in connection with the offer or sale of the Securities.


 


(h)
No Integrated Offering. Other than with respect to the RD Securities, none of the Company, its Subsidiaries or any of their
affiliates, nor any Person acting on their behalf has, directly or indirectly, made any offers or sales of any security or solicited
any offers to buy any security, under circumstances that would require registration of the issuance of any of the Securities under
the 1933 Act, whether through integration with prior offerings or otherwise, or cause this offering of the Securities to require
approval of shareholders of the Company for purposes of the 1933 Act or under any applicable shareholder approval provisions,
including, without limitation, under the rules and regulations of any exchange or automated quotation system on which any of the
securities of the Company are listed or designated for quotation. None of the Company, its Subsidiaries, their affiliates nor
any Person acting on their behalf will take any action or steps that would require registration of the issuance of any of the
Securities under the 1933 Act or cause the offering of any of the Securities to be integrated with other offerings of securities
of the Company.


 




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(i)
Dilutive Effect. The Company understands and acknowledges that the number of Warrant Shares will increase in certain
circumstances. The Company further acknowledges that its obligation to issue the Warrant Shares upon exercise of the Warrants
in accordance with this Agreement and the Warrants is, absolute and unconditional regardless of the dilutive effect that such
issuance may have on the ownership interests of other shareholders of the Company.


 


(j)
Application of Takeover Protections; Rights Agreement. The Company and its board of directors have taken all necessary
action, if any, in order to render inapplicable any control share acquisition, interested shareholder, business combination, poison
pill (including, without limitation, any distribution under a rights agreement), shareholder rights plan or other similar anti-takeover
provision under the Articles of Incorporation, Bylaws or other organizational documents or the laws of the jurisdiction of its
incorporation or otherwise which is or could become applicable to any Buyer as a result of the transactions contemplated by this
Agreement, including, without limitation, the Company’s issuance of the Securities and any Buyer’s ownership of the
Securities. The Company and its board of directors have taken all necessary action, if any, in order to render inapplicable any
shareholder rights plan or similar arrangement relating to accumulations of beneficial ownership of shares of Common Stock or
a change in control of the Company or any of its Subsidiaries.


 


(k)
SEC Documents; Financial Statements. During the two (2) years prior to the date hereof, the Company has timely filed all
reports, schedules, forms, proxy statements, statements and other documents required to be filed by it with the SEC pursuant to
the reporting requirements of the 1934 Act (all of the foregoing filed prior to the date hereof and all exhibits and appendices
included therein and financial statements, notes and schedules thereto and documents incorporated by reference therein being hereinafter
referred to as the (“SEC Documents”). The Company has delivered or has made available to the Buyers or their
respective representatives true, correct and complete copies of each of the SEC Documents not available on the EDGAR system. As
of their respective dates, the SEC Documents complied in all material respects with the requirements of the 1934 Act and the rules
and regulations of the SEC promulgated thereunder applicable to the SEC Documents, and none of the SEC Documents, at the time
they were filed with the SEC, contained any untrue statement of a material fact or omitted to state a material fact required to
be stated therein or necessary in order to make the statements therein, in the light of the circumstances under which they were
made, not misleading. As of their respective dates, the financial statements of the Company included in the SEC Documents complied
in all material respects with applicable accounting requirements and the published rules and regulations of the SEC with respect
thereto as in effect as of the time of filing. Such financial statements have been prepared in accordance with generally accepted
accounting principles (“GAAP”), consistently applied, during the periods involved (except (i) as may be otherwise
indicated in such financial statements or the notes thereto, or (ii) in the case of unaudited interim statements, to the extent
they may exclude footnotes or may be condensed or summary statements) and fairly present in all material respects the financial
position of the Company as of the dates thereof and the results of its operations and cash flows for the periods then ended (subject,
in the case of unaudited statements, to normal year-end audit adjustments which will not be material, either individually or in
the aggregate). The reserves, if any, established by the Company or the lack of reserves, if applicable, are reasonable based
upon facts and circumstances known by the Company on the date hereof and there are no loss contingencies that are required to
be accrued by the Statement of Financial Accounting Standard No. 5 of the Financial Accounting Standards Board which are not provided
for by the Company in its financial statements or otherwise. No other information provided by or on behalf of the Company to any
of the Buyers which is not included in the SEC Documents (including, without limitation, information referred to in Section 2(e)
of this Agreement or in the disclosure schedules to this Agreement) contains any untrue statement of a material fact or omits
to state any material fact necessary in order to make the statements therein not misleading, in the light of the circumstance
under which they are or were made. The Company is not currently contemplating to amend or restate any of the financial statements
(including, without limitation, any notes or any letter of the independent accountants of the Company with respect thereto) included
in the SEC Documents (the “Financial Statements”), nor is the Company currently aware of facts or circumstances
which would require the Company to amend or restate any of the Financial Statements, in each case, in order for any of the Financials
Statements to be in compliance with GAAP and the rules and regulations of the SEC. The Company has not been informed by its independent
accountants that they recommend that the Company amend or restate any of the Financial Statements or that there is any need for
the Company to amend or restate any of the Financial Statements.


 




    	 	10	 



     


    

 


(l)
Absence of Certain Changes. Since the date of the Company’s most recent audited financial statements contained in
a Form 10-K, there has been no material adverse change and no material adverse development in the business, assets, liabilities,
properties, operations (including results thereof), condition (financial or otherwise) or prospects of the Company or any of its
Subsidiaries. Since the date of the Company’s most recent audited financial statements contained in a Form 10-K, neither
the Company nor any of its Subsidiaries has (i) declared or paid any dividends, (ii) sold any assets, individually or in the aggregate,
outside of the ordinary course of business or (iii) made any capital expenditures, individually or in the aggregate, outside of
the ordinary course of business. Neither the Company nor any of its Subsidiaries has taken any steps to seek protection pursuant
to any law or statute relating to bankruptcy, insolvency, reorganization, receivership, liquidation or winding up, nor does the
Company or any Subsidiary have any knowledge or reason to believe that any of their respective creditors intend to initiate involuntary
bankruptcy proceedings or any actual knowledge of any fact which would reasonably lead a creditor to do so. The Company and its
Subsidiaries, individually and on a consolidated basis, are not after giving effect to the transactions contemplated hereby to
occur at the Closing, will not be Insolvent (as defined below). For purposes of this Section 3(l), “Insolvent”
means, (i) with respect to the Company and its Subsidiaries, on a consolidated basis, (A) the present fair saleable value of the
Company’s and its Subsidiaries’ assets is less than the amount required to pay the Company’s and its Subsidiaries’
total Indebtedness (as defined below), (B) the Company and its Subsidiaries are unable to pay their debts and liabilities, subordinated,
contingent or otherwise, as such debts and liabilities become absolute and matured or (C) the Company and its Subsidiaries intend
to incur or believe that they will incur debts that would be beyond their ability to pay as such debts mature; and (ii) with respect
to the Company and each Subsidiary, individually, (A) the present fair saleable value of the Company’s or such Subsidiary’s
(as the case may be) assets is less than the amount required to pay its respective total Indebtedness, (B) the Company or such
Subsidiary (as the case may be) is unable to pay its respective debts and liabilities, subordinated, contingent or otherwise,
as such debts and liabilities become absolute and matured or (C) the Company or such Subsidiary (as the case may be) intends to
incur or believes that it will incur debts that would be beyond its respective ability to pay as such debts mature. Neither the
Company nor any of its Subsidiaries has engaged in any business or in any transaction, and is not about to engage in any business
or in any transaction, for which the Company’s or such Subsidiary’s remaining assets constitute unreasonably small
capital with which to conduct the business in which it is engaged as such business is now conducted and is proposed to be conducted.


 






    	11



     


    

 


(m)
No Undisclosed Events, Liabilities, Developments or Circumstances. No event, liability, development or circumstance has
occurred or exists, or is reasonably expected to exist or occur with respect to the Company, any of its Subsidiaries or any of
their respective businesses, properties, liabilities, prospects, operations (including results thereof) or condition (financial
or otherwise), that (i) would be required to be disclosed by the Company under applicable securities laws on a registration statement
on Form S-1 filed with the SEC relating to an issuance and sale by the Company of its Common Stock and which has not been publicly
announced, (ii) could have a material adverse effect on any Buyer’s investment hereunder or (iii) could have a Material
Adverse Effect.


 


(n)
Conduct of Business; Regulatory Permits. Neither the Company nor any of its Subsidiaries is in violation of any term of
or in default under its Articles of Incorporation, any certificate of designation, preferences or rights of any other outstanding
series of preferred stock of the Company or any of its Subsidiaries or Bylaws or their organizational charter, certificate of
formation, memorandum of association, articles of association, Articles of Incorporation or certificate of incorporation or bylaws,
respectively. Neither the Company nor any of its Subsidiaries is in violation of any judgment, decree or order or any statute,
ordinance, rule or regulation applicable to the Company or any of its Subsidiaries, and neither the Company nor any of its Subsidiaries
will conduct its business in violation of any of the foregoing, except in all cases for possible violations which could not, individually
or in the aggregate, have a Material Adverse Effect. Without limiting the generality of the foregoing, except as disclosed in
the SEC Documents, the Company is not in violation of any of the rules, regulations or requirements of the Principal Market and
has no knowledge of any facts or circumstances that could reasonably lead to delisting or suspension of the Common Stock by the
Principal Market in the foreseeable future. During the two years prior to the date hereof, (i) the Common Stock has been listed
or designated for quotation on the Principal Market, (ii) trading in the Common Stock has not been suspended by the SEC or the
Principal Market and (iii) the Company has received no communication, written or oral, from the SEC or the Principal Market regarding
the suspension or delisting of the Common Stock from the Principal Market. The Company and each of its Subsidiaries possess all
certificates, authorizations and permits issued by the appropriate regulatory authorities necessary to conduct their respective
businesses, except where the failure to possess such certificates, authorizations or permits would not have, individually or in
the aggregate, a Material Adverse Effect, and neither the Company nor any such Subsidiary has received any notice of proceedings
relating to the revocation or modification of any such certificate, authorization or permit. There is no agreement, commitment,
judgment, injunction, order or decree binding upon the Company or any of its Subsidiaries or to which the Company or any of its
Subsidiaries is a party which has or would reasonably be expected to have the effect of prohibiting or materially impairing any
business practice of the Company or any of its Subsidiaries, any acquisition of property by the Company or any of its Subsidiaries
or the conduct of business by the Company or any of its Subsidiaries as currently conducted other than such effects, individually
or in the aggregate, which have not had and would not reasonably be expected to have a Material Adverse Effect on the Company
or any of its Subsidiaries.


 




    	 	12	 



     


    

 


(o)
Foreign Corrupt Practices. Neither the Company, the Company’s subsidiary or any director, officer, agent, employee,
nor any other person acting for or on behalf of the foregoing (individually and collectively, a “Company Affiliate”)
have violated the U.S. Foreign Corrupt Practices Act (the “FCPA”) or any other applicable anti-bribery or anti-corruption
laws, nor has any Company Affiliate offered, paid, promised to pay, or authorized the payment of any money, or offered, given,
promised to give, or authorized the giving of anything of value, to any officer, employee or any other person acting in an official
capacity for any Governmental Entity to any political party or official thereof or to any candidate for political office (individually
and collectively, a “Government Official”) or to any person under circumstances where such Company Affiliate
knew or was aware of a high probability that all or a portion of such money or thing of value would be offered, given or promised,
directly or indirectly, to any Government Official, for the purpose of:


 


(i)
(A) influencing any act or decision of such Government Official in his/her official capacity, (B) inducing such Government Official
to do or omit to do any act in violation of his/her lawful duty, (C) securing any improper advantage, or (D) inducing such Government
Official to influence or affect any act or decision of any Governmental Entity, or


 


(ii)
assisting the Company or its Subsidiaries in obtaining or retaining business for or with, or directing business to, the Company
or its Subsidiaries.


 


(p)
Sarbanes-Oxley Act. The Company and each Subsidiary is in compliance with any and all applicable requirements of the Sarbanes-Oxley
Act of 2002, as amended, and any and all applicable rules and regulations promulgated by the SEC thereunder.


 


(q)
Transactions With Affiliates. Except as disclosed in the SEC Documents, no current or former employee, partner, director,
officer or shareholder (direct or indirect) of the Company or its Subsidiaries, or any associate, or, to the knowledge of the
Company, any affiliate of any thereof, or any relative with a relationship no more remote than first cousin of any of the foregoing,
is presently, or has ever been, (i) a party to any transaction with the Company or its Subsidiaries (including any contract, agreement
or other arrangement providing for the furnishing of services by, or rental of real or personal property from, or otherwise requiring
payments to, any such director, officer or shareholder or such associate or affiliate or relative Subsidiaries (other than for
ordinary course services as employees, officers or directors of the Company or any of its Subsidiaries)) or (ii) the direct or
indirect owner of an interest in any corporation, firm, association or business organization which is a competitor, supplier or
customer of the Company or its Subsidiaries (except for a passive investment (direct or indirect) in less than 5% of the common
stock of a company whose securities are traded on or quoted through an Eligible Market (as defined below)), nor does any such
Person receive income from any source other than the Company or its Subsidiaries which relates to the business of the Company
or its Subsidiaries or should properly accrue to the Company or its Subsidiaries. No employee, officer, shareholder or director
of the Company or any of its Subsidiaries or member of his or her immediate family is indebted to the Company or its Subsidiaries,
as the case may be, nor is the Company or any of its Subsidiaries indebted (or committed to make loans or extend or guarantee
credit) to any of them, other than (i) for payment of salary for services rendered, (ii) reimbursement for reasonable expenses
incurred on behalf of the Company, and (iii) for other standard employee benefits made generally available to all employees or
executives (including stock option agreements outstanding under any stock option plan approved by the Board of Directors of the
Company).


 




    	 	13	 



     


    

 


(r)
Equity Capitalization.


 


(i)
Definitions:


 


(A)
“Common Stock” means (x) the Company’s shares of common stock, $0.001 par value per share, and (y) any
capital stock into which such common stock shall have been changed or any share capital resulting from a reclassification of such
common stock.


 


(B)
“Preferred Stock” means (x) the Company’s blank check preferred stock, $0.001 par value per share, the
terms of which may be designated by the board of directors of the Company in a certificate of designations and (y) any capital
stock into which such preferred stock shall have been changed or any share capital resulting from a reclassification of such preferred
stock (other than a conversion of such preferred stock into Common Stock in accordance with the terms of such certificate of designations).


 


(ii)
Authorized and Outstanding Capital Stock. As of the date hereof, the authorized capital stock of the Company consists of
(A) 8,000,000 shares of Common Stock, of which, 2,069,339 are issued and outstanding and 5,855,738 shares are reserved for issuance
pursuant to Convertible Securities (as defined below) (other than the Warrants) exercisable or exchangeable for, or convertible
into, shares of Common Stock and (B) 10,000,000 shares of Preferred Stock, 3,835 of which were previously issued and 908 of which
are currently outstanding. No shares of Common Stock are held in the treasury of the Company


 


(iii)
Valid Issuance; Available Shares; Affiliates. All of such outstanding shares are duly authorized and have been, or upon
issuance will be, validly issued and are fully paid and nonassessable. Schedule 3(r)(iii) sets forth the number of shares
of Common Stock that are (A) reserved for issuance pursuant to Convertible Securities (as defined below) (other than the Warrants)
and (B) that are, as of the date hereof, owned by Persons who are “affiliates” (as defined in Rule 405 of the 1933
Act and calculated based on the assumption that only officers, directors and holders of at least 10% of the Company’s issued
and outstanding Common Stock are “affiliates” without conceding that any such Persons are “affiliates”
for purposes of federal securities laws) of the Company or any of its Subsidiaries. Except as disclosed in the SEC Documents,
to the Company’s knowledge, no Person owns 10% or more of the Company’s issued and outstanding shares of Common Stock
(calculated based on the assumption that all Convertible Securities (as defined below), whether or not presently exercisable or
convertible, have been fully exercised or converted (as the case may be) taking account of any limitations on exercise or conversion
(including “blockers”) contained therein without conceding that such identified Person is a 10% shareholder for purposes
of federal securities laws).


 




    	 	14	 



     


    

 


(iv)
Existing Securities; Obligations. Except as disclosed in the SEC Documents or in Schedule 3(r)(iii): (A) none of
the Company’s or any Subsidiary’s shares, interests or capital stock is subject to preemptive rights or any other
similar rights or Liens suffered or permitted by the Company or any Subsidiary; (B) there are no outstanding options, warrants,
scrip, rights to subscribe to, calls or commitments of any character whatsoever relating to, or securities or rights convertible
into, or exercisable or exchangeable for, any shares, interests or capital stock of the Company or any of its Subsidiaries, or
contracts, commitments, understandings or arrangements by which the Company or any of its Subsidiaries is or may become bound
to issue additional shares, interests or capital stock of the Company or any of its Subsidiaries or options, warrants, scrip,
rights to subscribe to, calls or commitments of any character whatsoever relating to, or securities or rights convertible into,
or exercisable or exchangeable for, any shares, interests or capital stock of the Company or any of its Subsidiaries; (C) there
are no agreements or arrangements under which the Company or any of its Subsidiaries is obligated to register the sale of any
of their securities under the 1933 Act; (D) there are no outstanding securities or instruments of the Company or any of its Subsidiaries
which contain any redemption or similar provisions, and there are no contracts, commitments, understandings or arrangements by
which the Company or any of its Subsidiaries is or may become bound to redeem a security of the Company or any of its Subsidiaries;
(E) there are no securities or instruments containing anti-dilution or similar provisions that will be triggered by the issuance
of the Securities; and (F) neither the Company nor any Subsidiary has any stock appreciation rights or “phantom stock”
plans or agreements or any similar plan or agreement.


 


(v)
Organizational Documents. The Company has furnished to the Buyers true, correct and complete copies of the Company’s
Articles of Incorporation, as amended and as in effect on the date hereof (the “Articles of Incorporation”),
and the Company’s bylaws, as amended and as in effect on the date hereof (the “Bylaws”), and the terms
of all Convertible Securities and the material rights of the holders thereof in respect thereto.


 






    	15



     


    

 


(s)
Indebtedness and Other Contracts. Neither the Company nor any of its Subsidiaries, (i) except as set forth in the SEC Documents,
has any outstanding debt securities, notes, credit agreements, credit facilities or other agreements, documents or instruments
evidencing Indebtedness of the Company or any of its Subsidiaries or by which the Company or any of its Subsidiaries is or may
become bound, (ii) is a party to any contract, agreement or instrument, the violation of which, or default under which, by the
other party(ies) to such contract, agreement or instrument could reasonably be expected to result in a Material Adverse Effect,
(iii) has any financing statements securing obligations in any amounts filed in connection with the Company or any of its Subsidiaries;
(iv) is in violation of any term of, or in default under, any contract, agreement or instrument relating to any Indebtedness,
except where such violations and defaults would not result, individually or in the aggregate, in a Material Adverse Effect, or
(v) is a party to any contract, agreement or instrument relating to any Indebtedness, the performance of which, in the judgment
of the Company’s officers, has or is expected to have a Material Adverse Effect. Neither the Company nor any of its Subsidiaries
have any liabilities or obligations required to be disclosed in the SEC Documents which are not so disclosed in the SEC Documents,
other than those incurred in the ordinary course of the Company’s or its Subsidiaries’ respective businesses and which,
individually or in the aggregate, do not or could not have a Material Adverse Effect. For purposes of this Agreement: (x) “Indebtedness”
of any Person means, without duplication (A) all indebtedness for borrowed money, (B) all obligations issued, undertaken or assumed
as the deferred purchase price of property or services (including, without limitation, “capital leases” in accordance
with GAAP) (other than trade payables entered into in the ordinary course of business consistent with past practice), (C) all
reimbursement or payment obligations with respect to letters of credit, surety bonds and other similar instruments, (D) all obligations
evidenced by notes, bonds, debentures or similar instruments, including obligations so evidenced incurred in connection with the
acquisition of property, assets or businesses, (E) all indebtedness created or arising under any conditional sale or other title
retention agreement, or incurred as financing, in either case with respect to any property or assets acquired with the proceeds
of such indebtedness (even though the rights and remedies of the seller or bank under such agreement in the event of default are
limited to repossession or sale of such property), (F) all monetary obligations under any leasing or similar arrangement which,
in connection with GAAP, consistently applied for the periods covered thereby, is classified as a capital lease, (G) all indebtedness
referred to in clauses (A) through (F) above secured by (or for which the holder of such Indebtedness has an existing right, contingent
or otherwise, to be secured by) any Lien upon or in any property or assets (including accounts and contract rights) owned by any
Person, even though the Person which owns such assets or property has not assumed or become liable for the payment of such indebtedness,
and (H) all Contingent Obligations in respect of indebtedness or obligations of others of the kinds referred to in clauses (A)
through (G) above; and (y) “Contingent Obligation” means, as to any Person, any direct or indirect liability,
contingent or otherwise, of that Person with respect to any Indebtedness, lease, dividend or other obligation of another Person
if the primary purpose or intent of the Person incurring such liability, or the primary effect thereof, is to provide assurance
to the obligee of such liability that such liability will be paid or discharged, or that any agreements relating thereto will
be complied with, or that the holders of such liability will be protected (in whole or in part) against loss with respect thereto.


 


(t)
Litigation. There is no action, suit, arbitration, proceeding, inquiry or investigation before or by the Principal Market,
any court, public board, other Governmental Entity, self-regulatory organization or body pending or, to the knowledge of the Company,
threatened against or affecting the Company or any of its Subsidiaries, the Common Stock or any of the Company’s or its
Subsidiaries’ officers or directors, whether of a civil or criminal nature or otherwise, in their capacities as such, which,
except as disclosed in the SEC Documents, is outside of the ordinary course of business or individually or in the aggregate material
to the Company or any of its Subsidiaries. No director, officer or employee of the Company or any of its subsidiaries has willfully
violated 18 U.S.C. §1519 or engaged in spoliation in reasonable anticipation of litigation. Without limitation of the foregoing,
there has not been, and to the knowledge of the Company, there is not pending or contemplated, any investigation by the SEC involving
the Company, any of its Subsidiaries or any current or former director or officer of the Company or any of its Subsidiaries. The
SEC has not issued any stop order or other order suspending the effectiveness of any registration statement filed by the Company
under the 1933 Act or the 1934 Act, including, without limitation, the Registration Statement. After reasonable inquiry of its
employees, the Company is not aware of any fact which might result in or form the basis for any such action, suit, arbitration,
investigation, inquiry or other proceeding. Neither the Company nor any of its Subsidiaries is subject to any order, writ, judgment,
injunction, decree, determination or award of any Governmental Entity.


 




    	 	16	 



     


    

 


(u)
Insurance. The Company and each of its Subsidiaries are insured by insurers of recognized financial responsibility against
such losses and risks and in such amounts as management of the Company believes to be prudent and customary in the businesses
in which the Company and its Subsidiaries are engaged. Neither the Company nor any such Subsidiary has been refused any insurance
coverage sought or applied for, and neither the Company nor any such Subsidiary has any reason to believe that it will be unable
to renew its existing insurance coverage as and when such coverage expires or to obtain similar coverage from similar insurers
as may be necessary to continue its business at a cost that would not have a Material Adverse Effect.


 


(v)
Employee Relations. Neither the Company nor any of its Subsidiaries is a party to any collective bargaining agreement or
employs any member of a union. The Company and its Subsidiaries believe that their relations with their employees are good. No
executive officer (as defined in Rule 501(f) promulgated under the 1933 Act) or other key employee of the Company or any of its
Subsidiaries has notified the Company or any such Subsidiary that such officer intends to leave the Company or any such Subsidiary
or otherwise terminate such officer’s employment with the Company or any such Subsidiary. No executive officer or other
key employee of the Company or any of its Subsidiaries is, or is now expected to be, in violation of any material term of any
employment contract, confidentiality, disclosure or proprietary information agreement, non-competition agreement, or any other
contract or agreement or any restrictive covenant, and the continued employment of each such executive officer or other key employee
(as the case may be) 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 federal, state, local and foreign laws and regulations respecting
labor, employment and employment practices and benefits, terms and conditions of employment and wages and hours, except where
failure to be in compliance would not, either individually or in the aggregate, reasonably be expected to result in a Material
Adverse Effect.


 


(w)
Title.


 


(i)
Real Property. Each of the Company and its Subsidiaries holds good title to all real property, leases in real property,
facilities or other interests in real property owned or held by the Company or any of its Subsidiaries (the “Real Property”)
owned by the Company or any of its Subsidiaries (as applicable). The Real Property is free and clear of all Liens and is not subject
to any rights of way, building use restrictions, exceptions, variances, reservations, or limitations of any nature except for
(a) Liens for current taxes not yet due and (b) zoning laws and other land use restrictions that do not impair the present or
anticipated use of the property subject thereto. Any Real Property held under lease by the Company or any of its Subsidiaries
are held by them under valid, subsisting and enforceable leases with such exceptions as are not material and do not interfere
with the use made and proposed to be made of such property and buildings by the Company or any of its Subsidiaries.


 




    	 	17	 



     


    

 


(ii)
Fixtures and Equipment. Each of the Company and its Subsidiaries (as applicable) has good title to, or a valid leasehold
interest in, the tangible personal property, equipment, improvements, fixtures, and other personal property and appurtenances
that are used by the Company or its Subsidiary in connection with the conduct of its business (the “Fixtures and Equipment”).
The Fixtures and Equipment are structurally sound, are in good operating condition and repair, are adequate for the uses to which
they are being put, are not in need of maintenance or repairs except for ordinary, routine maintenance and repairs and are sufficient
for the conduct of the Company’s and/or its Subsidiaries’ businesses (as applicable) in the manner as conducted prior
to the Closing. Each of the Company and its Subsidiaries owns all of its Fixtures and Equipment free and clear of all Liens except
for (a) Liens for current taxes not yet due and (b) zoning laws and other land use restrictions that do not impair the present
or anticipated use of the property subject thereto.


 


(x)
Intellectual Property Rights. The Company and its Subsidiaries own or possess adequate rights or licenses to use all trademarks,
trade names, service marks, service mark registrations, service names, original works of authorship, patents, patent rights, copyrights,
inventions, licenses, approvals, governmental authorizations, trade secrets and other intellectual property rights and all applications
and registrations therefor (“Intellectual Property Rights”) necessary to conduct their respective businesses
as now conducted and presently proposed to be conducted. Except as set forth in Schedule 3(w)(ii)(ii), none of the Company’s
Intellectual Property Rights have expired or terminated or have been abandoned or are expected to expire or terminate or are expected
to be abandoned, within three years from the date of this Agreement. The Company does not have any knowledge of any infringement
by the Company or its Subsidiaries of Intellectual Property Rights of others. There is no claim, action or proceeding being made
or brought, or to the knowledge of the Company or any of its Subsidiaries, being threatened, against the Company or any of its
Subsidiaries regarding its Intellectual Property Rights. Neither the Company nor any of its Subsidiaries is aware of any facts
or circumstances which might give rise to any of the foregoing infringements or claims, actions or proceedings. The Company and
its Subsidiaries have taken reasonable security measures to protect the secrecy, confidentiality and value of all of their Intellectual
Property Rights.


 


(y)
Environmental Laws. (i) The Company and its Subsidiaries (A) are in compliance with any and all Environmental Laws (as
defined below), (B) have received all permits, licenses or other approvals required of them under applicable Environmental Laws
to conduct their respective businesses and (C) are in compliance with all terms and conditions of any such permit, license or
approval where, in each of the foregoing clauses (A), (B) and (C), the failure to so comply could be reasonably expected to have,
individually or in the aggregate, a Material Adverse Effect. The term “Environmental Laws” means all federal, state,
local or foreign laws relating to pollution or protection of human health or the environment (including, without limitation, ambient
air, surface water, groundwater, land surface or subsurface strata), including, without limitation, laws relating to emissions,
discharges, releases or threatened releases of chemicals, pollutants, contaminants, or toxic or hazardous substances or wastes
(collectively, “Hazardous Materials”) into the environment, or otherwise relating to the manufacture, processing,
distribution, use, treatment, storage, disposal, transport or handling of Hazardous Materials, as well as all authorizations,
codes, decrees, demands or demand letters, injunctions, judgments, licenses, notices or notice letters, orders, permits, plans
or regulations issued, entered, promulgated or approved thereunder.


 




    	 	18	 



     


    

 


(ii)
No Hazardous Materials:


 


(A)
have been disposed of or otherwise released into any Real Property (as defined below) in violation of any Environmental Laws;
or


 


(B)
are present on, over, beneath, in or upon any Real Property or any portion thereof in quantities that would constitute a violation
of any Environmental Laws. No prior use by the Company or any of its Subsidiaries of any Real Property has occurred that violates
any Environmental Laws, which violation would have a material adverse effect on the business of the Company or any of its Subsidiaries.


 


(iii)
Neither the Company nor any of its Subsidiaries knows of any other person who or entity which has stored, treated, recycled, disposed
of or otherwise located any Hazardous Materials on any Real Property, including, without limitation, such substances as asbestos
and polychlorinated biphenyls.


 


(iv)
None of the Real Properties are on any federal or state “Superfund” list or Liability Information System (“CERCLIS”)
list or any state environmental agency list of sites under consideration for CERCLIS, nor subject to any environmental related
Liens.


 


(z)
Subsidiary Rights. The Company or one of its Subsidiaries has the unrestricted right to vote, and (subject to limitations
imposed by applicable law) to receive dividends and distributions on, all capital securities of its Subsidiaries as owned by the
Company or such Subsidiary.


 


(aa)
Tax Status. The Company and each of its Subsidiaries (i) has timely made or filed all foreign, federal and state income
and all other tax returns, reports and declarations required by any jurisdiction to which it is subject, (ii) has timely paid
all taxes and other governmental assessments and charges that are material in amount, shown or determined to be due on such returns,
reports and declarations, except those being contested in good faith and (iii) has set aside on its books provision reasonably
adequate for the payment of all taxes for periods subsequent to the periods to which such returns, reports or declarations apply.
There are no unpaid taxes in any material amount claimed to be due by the taxing authority of any jurisdiction, and the officers
of the Company and its Subsidiaries know of no basis for any such claim. The Company is not operated in such a manner as to qualify
as a passive foreign investment company, as defined in Section 1297 of the U.S. Internal Revenue Code of 1986, as amended (the
“Code”). The net operating loss carryforwards (“NOLs”) for United States federal income
tax purposes of the consolidated group of which the Company is the common parent, if any, shall not be adversely effected by the
transactions contemplated hereby. The transactions contemplated hereby do not constitute an “ownership change” within
the meaning of Section 382 of the Code, thereby preserving the Company’s ability to utilize such NOLs.


 




    	 	19	 



     


    

 


(bb)
Internal Accounting and Disclosure Controls. The Company and each of its Subsidiaries maintains internal control over financial
reporting (as such term is defined in Rule 13a-15(f) under the 1934 Act) that is effective to provide reasonable assurance regarding
the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally
accepted accounting principles, including 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 and liability accountability, (iii) access to assets or incurrence of liabilities is permitted
only in accordance with management’s general or specific authorization and (iv) the recorded accountability for assets and
liabilities is compared with the existing assets and liabilities at reasonable intervals and appropriate action is taken with
respect to any difference. The Company maintains disclosure controls and procedures (as such term is defined in Rule 13a-15(e)
under the 1934 Act) that are effective in ensuring that information required to be disclosed by the Company in the reports that
it files or submits under the 1934 Act is recorded, processed, summarized and reported, within the time periods specified in the
rules and forms of the SEC, including, without limitation, controls and procedures designed to ensure that information required
to be disclosed by the Company in the reports that it files or submits under the 1934 Act is accumulated and communicated to the
Company’s management, including its principal executive officer or officers and its principal financial officer or officers,
as appropriate, to allow timely decisions regarding required disclosure. Neither the Company nor any of its Subsidiaries has received
any notice or correspondence from any accountant, Governmental Entity or other Person relating to any potential material weakness
or significant deficiency in any part of the internal controls over financial reporting of the Company or any of its Subsidiaries.


 


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


 


(dd)
Investment Company Status. The Company is not, and upon consummation of the sale of the Securities will not be, an “investment
company,” an affiliate of an “investment company,” a company controlled by an “investment company”
or an “affiliated person” of, or “promoter” or “principal underwriter” for, an “investment
company” as such terms are defined in the Investment Company Act of 1940, as amended.


 




    	 	20	 



     


    

 


(ee)
Acknowledgement Regarding Buyers’ Trading Activity. It is understood and acknowledged by the Company that (i) following
the public disclosure of the transactions contemplated by the Transaction Documents, in accordance with the terms thereof, none
of the Buyers have been asked by the Company or any of its Subsidiaries to agree, nor has any Buyer agreed with the Company or
any of its Subsidiaries, to desist from effecting any transactions in or with respect to (including, without limitation, purchasing
or selling, long and/or short) any securities of the Company, or “derivative” securities based on securities issued
by the Company or to hold any of the Securities for any specified term; (ii) any Buyer, and counterparties in “derivative”
transactions to which any such Buyer is a party, directly or indirectly, presently may have a “short” position in
the Common Stock which was established prior to such Buyer’s knowledge of the transactions contemplated by the Transaction
Documents; (iii) each Buyer shall not be deemed to have any affiliation with or control over any arm’s length counterparty
in any “derivative” transaction; and (iv) each Buyer may rely on the Company’s obligation to timely deliver
shares of Common Stock upon exercise or exchange, as applicable, of the Securities as and when required pursuant to the Transaction
Documents for purposes of effecting trading in the Common Stock of the Company. The Company further understands and acknowledges
that following the public disclosure of the transactions contemplated by the Transaction Documents pursuant to the Press Release
(as defined below) one or more Buyers may engage in hedging and/or trading activities (including, without limitation, the location
and/or reservation of borrowable shares of Common Stock) at various times during the period that the Securities are outstanding,
including, without limitation, during the periods that the value and/or number of the Warrant Shares deliverable with respect
to the Securities are being determined and such hedging and/or trading activities (including, without limitation, the location
and/or reservation of borrowable shares of Common Stock), if any, can reduce the value of the existing shareholders’ equity
interest in the Company both at and after the time the hedging and/or trading activities are being conducted. The Company acknowledges
that such aforementioned hedging and/or trading activities do not constitute a breach of this Agreement, the Warrants or any other
Transaction Document or any of the documents executed in connection herewith or therewith.


 


(ff)
Manipulation of Price. Neither the Company nor any of its Subsidiaries has, and, to the knowledge of the Company, no Person
acting on their behalf has, directly or indirectly, (i) taken any action designed to cause or to result in the stabilization or
manipulation of the price of any security of the Company or any of its Subsidiaries 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 (other
than the Placement Agent), (iii) paid or agreed to pay to any Person any compensation for soliciting another to purchase any other
securities of the Company or any of its Subsidiaries or (iv) paid or agreed to pay any Person for research services with respect
to any securities of the Company or any of its Subsidiaries.


 


(gg)
U.S. Real Property Holding Corporation. Neither the Company nor any of its Subsidiaries is, or has ever been, and so long
as any of the Securities are held by any of the Buyers, shall become, a U.S. real property holding corporation within the meaning
of Section 897 of the Code, and the Company and each Subsidiary shall so certify upon any Buyer’s request.


 


(hh)
Registration Eligibility. The Company is eligible to register the issuance of the RD Securities by the Company using Form
S-3 promulgated under the 1933 Act. The Company is eligible to register the PIPE Securities for resale by the Buyers using Form
S-3 promulgated under the 1933 Act.


 


(ii)
Transfer Taxes. On the Closing Date, all stock transfer or other taxes (other than income or similar taxes) which are required
to be paid in connection with the issuance, sale and transfer of the Securities to be sold to each Buyer hereunder will be, or
will have been, fully paid or provided for by the Company, and all laws imposing such taxes will be or will have been complied
with.


 




    	 	21	 



     


    

 


(jj)
Bank Holding Company Act. Neither the Company nor any of its Subsidiaries is subject to the Bank Holding Company Act of
1956, as amended (the “BHCA”) and to regulation by the Board of Governors of the Federal Reserve System (the
“Federal Reserve”). Neither the Company nor any of its Subsidiaries or affiliates owns or controls, directly
or indirectly, five percent (5%) or more of the outstanding shares of any class of voting securities or twenty-five percent (25%)
or more of the total equity of a bank or any entity that is subject to the BHCA and to regulation by the Federal Reserve. Neither
the Company nor any of its Subsidiaries or affiliates exercises a controlling influence over the management or policies of a bank
or any entity that is subject to the BHCA and to regulation by the Federal Reserve.


 


(kk)
[Intentionally Omitted]


 


(ll)
Illegal or Unauthorized Payments; Political Contributions. Neither the Company nor any of its Subsidiaries nor, to the
best of the Company’s knowledge (after reasonable inquiry of its officers and directors), any of the officers, directors,
employees, agents or other representatives of the Company or any of its Subsidiaries or any other business entity or enterprise
with which the Company or any Subsidiary is or has been affiliated or associated, has, directly or indirectly, made or authorized
any payment, contribution or gift of money, property, or services, whether or not in contravention of applicable law, (i) as a
kickback or bribe to any Person or (ii) to any political organization, or the holder of or any aspirant to any elective or appointive
public office except for personal political contributions not involving the direct or indirect use of funds of the Company or
any of its Subsidiaries.


 


(mm)
Money Laundering. The Company and its Subsidiaries are in compliance with, and have not previously violated, the USA Patriot
Act of 2001 and all other applicable U.S. and non-U.S. anti-money laundering laws and regulations, including, but not limited
to, the laws, regulations and Executive Orders and sanctions programs administered by the U.S. Office of Foreign Assets Control,
including, without limitation, (i) Executive Order 13224 of September 23, 2001 entitled, “Blocking Property and Prohibiting
Transactions With Persons Who Commit, Threaten to Commit, or Support Terrorism” (66 Fed. Reg. 49079 (2001)); and (ii) any
regulations contained in 31 CFR, Subtitle B, Chapter V.


 


(nn)
Management. Except as set forth in Schedule 3(nn) hereto, during the past five year period, no current or former
officer or director or, to the knowledge of the Company, no current ten percent (10%) or greater shareholder of the Company or
any of its Subsidiaries has been the subject of:


 


(i)
a petition under bankruptcy laws or any other insolvency or moratorium law or the appointment by a court of a receiver, fiscal
agent or similar officer for such Person, or any partnership in which such person was a general partner at or within two years
before the filing of such petition or such appointment, or any corporation or business association of which such person was an
executive officer at or within two years before the time of the filing of such petition or such appointment;


 


(ii)
a conviction in a criminal proceeding or a named subject of a pending criminal proceeding (excluding traffic violations that do
not relate to driving while intoxicated or driving under the influence);


 




    	 	22	 



     


    

 


(iii)
any order, judgment or decree, not subsequently reversed, suspended or vacated, of any court of competent jurisdiction, permanently
or temporarily enjoining any such person from, or otherwise limiting, the following activities:


 


(1)
Acting as a futures commission merchant, introducing broker, commodity trading advisor, commodity pool operator, floor broker,
leverage transaction merchant, any other person regulated by the United States Commodity Futures Trading Commission or an associated
person of any of the foregoing, or as an investment adviser, underwriter, broker or dealer in securities, or as an affiliated
person, director or employee of any investment company, bank, savings and loan association or insurance company, or engaging in
or continuing any conduct or practice in connection with such activity;


 


(2)
Engaging in any particular type of business practice; or


 


(3)
Engaging in any activity in connection with the purchase or sale of any security or commodity or in connection with any violation
of securities laws or commodities laws;


 


(iv)
any order, judgment or decree, not subsequently reversed, suspended or vacated, of any authority barring, suspending or otherwise
limiting for more than sixty (60) days the right of any such person to engage in any activity described in the preceding sub paragraph,
or to be associated with persons engaged in any such activity;


 


(v)
a finding by a court of competent jurisdiction in a civil action or by the SEC or other authority to have violated any securities
law, regulation or decree and the judgment in such civil action or finding by the SEC or any other authority has not been subsequently
reversed, suspended or vacated; or


 


(vi)
a finding by a court of competent jurisdiction in a civil action or by the Commodity Futures Trading Commission to have violated
any federal commodities law, and the judgment in such civil action or finding has not been subsequently reversed, suspended or
vacated.


 


(oo)
Stock Option Plans. Each stock option granted by the Company was granted (i) in accordance with the terms of the applicable
stock option plan of the Company and (ii) with an exercise price at least equal to the fair market value of the Common Stock on
the date such stock option would be considered granted under GAAP and applicable law. No stock option granted under the Company’s
stock option plan has been backdated. The Company has not knowingly granted, and there is no and has been no policy or practice
of the Company to knowingly grant, stock options prior to, or otherwise knowingly coordinate the grant of stock options with,
the release or other public announcement of material information regarding the Company or its Subsidiaries or their financial
results or prospects.


 




    	 	23	 



     


    

 


(pp)
No Disagreements with Accountants and Lawyers. There are no material disagreements of any kind presently existing, or reasonably
anticipated by the Company to arise, between the Company and the accountants and lawyers formerly or presently employed by the
Company and the Company is current with respect to any fees owed to its accountants and lawyers which could affect the Company’s
ability to perform any of its obligations under any of the Transaction Documents. In addition, on or prior to the date hereof,
the Company had discussions with its accountants about its financial statements previously filed with the SEC. Based on those
discussions, the Company has no reason to believe that it will need to restate any such financial statements or any part thereof.


 


(qq)
No Disqualification Events. With respect to Securities to be offered and sold hereunder in reliance on Rule 506(b) under
the 1933 Act (“Regulation D Securities”), none of the Company, any of its predecessors, any affiliated issuer,
any director, executive officer, other officer of the Company participating in the offering contemplated hereby, any beneficial
owner of 20% or more of the Company’s outstanding voting equity securities, calculated on the basis of voting power, nor
any promoter (as that term is defined in Rule 405 under the 1933 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 1933 Act (a “Disqualification
Event”), except for a Disqualification Event covered by Rule 506(d)(2) or (d)(3). The Company has exercised reasonable
care to determine whether any Issuer Covered Person is subject to a Disqualification Event. The Company has complied, to the extent
applicable, with its disclosure obligations under Rule 506(e), and has furnished to the Buyers a copy of any disclosures provided
thereunder.


 


(rr)
Other Covered Persons. The Company is not aware of any Person (other than the Placement Agent) that has been or will be
paid (directly or indirectly) remuneration for solicitation of Buyers or potential purchasers in connection with the sale of any
Regulation D Securities.


 


(ss)
No Additional Agreements. The Company does not have any agreement or understanding with any Buyer with respect to the transactions
contemplated by the Transaction Documents other than as specified in the Transaction Documents.


 


(tt)
Public Utility Holding Act None of the Company nor any of its Subsidiaries is a “holding company,” or an “affiliate”
of a “holding company,” as such terms are defined in the Public Utility Holding Act of 2005.


 


(uu)
Federal Power Act. None of the Company nor any of its Subsidiaries is subject to regulation as a “public utility”
under the Federal Power Act, as amended.


 


(vv)
Registration Rights. No holder of securities of the Company has rights to the registration of any securities of the Company
because of the issuance of the Securities hereunder that could expose the Company to material liability or any Buyer to any liability
or that could impair the Company’s ability to consummate the issuance and sale of the Securities in the manner, and at the
times, contemplated hereby, which rights have not been waived by the holder thereof as of the date hereof.


 


(ww)
Compliance With FINRA Rule 5110. At the time the Registration Statement was declared effective by the SEC, and as of the
date hereof and as of the Closing Date, the Company has a 1934 Act reporting history in excess of 36 months.


 




    	 	24	 



     


    

 


(xx)
Disclosure. The Company confirms that neither it nor any other Person acting on its behalf has provided any of the Buyers
or their agents or counsel with any information that constitutes or could reasonably be expected to constitute material, non-public
information concerning the Company or any of its Subsidiaries, other than the existence of the transactions contemplated by this
Agreement and the other Transaction Documents. The Company understands and confirms that each of the Buyers will rely on the foregoing
representations in effecting transactions in securities of the Company. All disclosure provided to the Buyers regarding the Company
and its Subsidiaries, their businesses and the transactions contemplated hereby, including the schedules to this Agreement, furnished
by or on behalf of the Company or any of its Subsidiaries 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. All of the written information furnished after the date hereof by or on behalf of
the Company or any of its Subsidiaries to each Buyer pursuant to or in connection with this Agreement and the other Transaction
Documents, taken as a whole, will be true and correct in all material respects as of the date on which such information is so
provided and will 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. Each press release
issued by the Company or any of its Subsidiaries during the twelve (12) months preceding the date of this Agreement did not at
the time of release contain any untrue statement of a material fact or omit to state a material fact required to be stated therein
or necessary in order to make the statements therein, in the light of the circumstances under which they are made, not misleading.
No event or circumstance has occurred or information exists with respect to the Company or any of its Subsidiaries or its or their
business, properties, liabilities, prospects, operations (including results thereof) or conditions (financial or otherwise), which,
under applicable law, rule or regulation, requires public disclosure at or before the date hereof or announcement by the Company
but which has not been so publicly disclosed. All financial projections and forecasts that have been prepared by or on behalf
of the Company or any of its Subsidiaries and made available to you have been prepared in good faith based upon reasonable assumptions
and represented, at the time each such financial projection or forecast was delivered to each Buyer, the Company’s best
estimate of future financial performance (it being recognized that such financial projections or forecasts are not to be viewed
as facts and that the actual results during the period or periods covered by any such financial projections or forecasts may differ
from the projected or forecasted results). The Company acknowledges and agrees that no Buyer makes or has made any representations
or warranties with respect to the transactions contemplated hereby other than those specifically set forth in Section 2.


 


4.
COVENANTS.


 


(a)
Reasonable Best Efforts. Each Buyer shall use its reasonable best efforts to timely satisfy each of the covenants hereunder
and conditions to be satisfied by it as provided in Section 6 of this Agreement. The Company shall use its reasonable best efforts
to timely satisfy each of the covenants hereunder and conditions to be satisfied by it as provided in Section 7 of this Agreement.


 




    	 	25	 



     


    

 


(b)
Amendments to the Registration Statement; Prospectus Supplements; Free Writing Prospectuses.


 


(i)
Amendments to the Registration Statement; Prospectus Supplements; Free Writing Prospectuses. Except as provided in this
Agreement and other than periodic reports required to be filed pursuant to the 1934 Act, the Company shall not file with the SEC
any amendment to the Registration Statement that relates to the Buyer, this Agreement, the Warrants or the transactions contemplated
hereby or thereby or file with the SEC any Prospectus Supplement that relates to the Buyer, this Agreement, the Warrants or the
transactions contemplated hereby or thereby with respect to which (a) the Buyer shall not previously have been advised, (b) the
Company shall not have given due consideration to any comments thereon received from the Buyer or its counsel, or (c) the Buyer
shall reasonably object after being so advised, unless the Company reasonably has determined that it is necessary to amend the
Registration Statement or make any supplement to the Prospectus to comply with the 1933 Act or any other applicable law or regulation,
in which case the Company shall promptly (but in no event later than 24 hours) so inform the Buyer, the Buyer shall be provided
with a reasonable opportunity to review and comment upon any disclosure relating to the Buyer and the Company shall expeditiously
furnish to the Buyer an electronic copy thereof. In addition, for so long as, in the reasonable opinion of counsel for the Buyer,
the Prospectus (or in lieu thereof, the notice referred to in Rule 173(a) under the 1933 Act) is required to be delivered in connection
with any acquisition or sale of RD Securities by the Buyer, the Company shall not file any Prospectus Supplement with respect
to the RD Securities without delivering or making available a copy of such Prospectus Supplement, together with the Prospectus,
to the Buyer promptly.


 


(ii)
The Company has not made, and agrees that unless it obtains the prior written consent of the Buyer it will not make, an offer
relating to the RD Securities that would constitute an “issuer free writing prospectus” as defined in Rule 433 promulgated
under the 1933 Act (an “Issuer Free Writing Prospectus”) or that would otherwise constitute a “free writing
prospectus” as defined in Rule 405 promulgated under the 1933 Act (a “Free Writing Prospectus”) required
to be filed by the Company or the Buyer with the SEC or retained by the Company or the Buyer under Rule 433 under the 1933 Act.
The Buyer has not made, and agrees that unless it obtains the prior written consent of the Company it will not make, an offer
relating to the RD Securities that would constitute a Free Writing Prospectus required to be filed by the Company with the SEC
or retained by the Company under Rule 433 under the 1933 Act. Any such Issuer Free Writing Prospectus or other Free Writing Prospectus
consented to by the Buyer or the Company is referred to in this Agreement as a “Permitted Free Writing Prospectus.”
The Company agrees that, to the extent the Company is eligible to issue a free writing prospectus, (x) it has treated and will
treat, as the case may be, each Permitted Free Writing Prospectus as an Issuer Free Writing Prospectus and (y) it has complied
and will comply, as the case may be, with the requirements of Rules 164 and 433 under the 1933 Act applicable to any Permitted
Free Writing Prospectus, including in respect of timely filing with the SEC, legending and record keeping.


 




    	 	26	 



     


    

 


(c)
Prospectus Delivery. Immediately prior to execution of this Agreement, the Company shall have delivered to the Buyer, and
as soon as practicable after execution of this Agreement the Company shall file, Prospectus Supplement with respect to the RD
Securities to be issued on the Closing Date, as required under, and in conformity with, the 1933 Act, including Rule 424(b) thereunder.
The Company shall provide the Buyer a reasonable opportunity to comment on a draft of each Prospectus Supplement and any Issuer
Free Writing Prospectus, shall give due consideration to all such comments and, subject to the provisions of Section 4(a) hereof,
shall deliver or make available to the Buyer, without charge, an electronic copy of each form of Prospectus Supplement, together
with the Prospectus, and any Permitted Free Writing Prospectus on the Closing Date. The Company consents to the use of the Prospectus
(and of any Prospectus Supplements thereto) in accordance with the provisions of the 1933 Act and with the securities or “blue
sky” laws of the jurisdictions in which the RD Securities may be sold by the Buyer, in connection with the offering and
sale of the RD Securities and for such period of time thereafter as the Prospectus (or in lieu thereof, the notice referred to
in Rule 173(a) under the 1933 Act) is required by the 1933 Act to be delivered in connection with sales of the RD Securities.
If during such period of time any event shall occur that in the judgment of the Company and its counsel is required to be set
forth in the Registration Statement or the Prospectus or any Permitted Free Writing Prospectus or should be set forth therein
in order to make the statements made therein (in the case of the Prospectus, in light of the circumstances under which they were
made) not misleading, or if it is necessary to amend the Registration Statement or supplement or amend the Prospectus or any Permitted
Free Writing Prospectus to comply with the 1933 Act or any other applicable law or regulation, the Company shall forthwith prepare
and, subject to Section 4(a) above, file with the SEC an appropriate amendment to the Registration Statement or Prospectus Supplement
to the Prospectus (or supplement to the Permitted Free Writing Prospectus) and shall expeditiously furnish or make available to
the Buyer an electronic copy thereof.


 


(d)
Stop Orders. The Company shall advise the Buyer promptly (but in no event later than 24 hours) and shall confirm such oral
or written advice in writing: (i) of the Company’s receipt of notice of any request by the SEC for amendment of or a supplement
to the Registration Statement, the Prospectus, any Permitted Free Writing Prospectus or for any additional information; (ii) of
the Company’s receipt of notice of the issuance by the SEC of any stop order suspending the effectiveness of the Registration
Statement or prohibiting or suspending the use of the Prospectus or any Prospectus Supplement, or of the suspension of qualification
of the RD Securities for offering or sale in any jurisdiction, or the initiation or contemplated initiation of any proceeding
for such purpose; (iii) of the Company becoming aware of the happening of any event, which makes any statement of a material fact
made in the Registration Statement, the Prospectus or any Permitted Free Writing Prospectus untrue or which requires the making
of any additions to or changes to the statements then made in the Registration Statement, the Prospectus or any Permitted Free
Writing Prospectus in order to state a material fact required by the 1933 Act to be stated therein or necessary in order to make
the statements then made therein (in the case of the Prospectus, in light of the circumstances under which they were made) not
misleading, or of the necessity to amend the Registration Statement or supplement the Prospectus or any Permitted Free Writing
Prospectus to comply with the 1933 Act or any other law or (iv) if at any time following the date hereof the Registration Statement
is not effective or is not otherwise available for the issuance of the RD Securities or any Prospectus contained therein is not
available for use for any other reason. Thereafter, the Company shall promptly notify such holders when the Registration Statement,
the Prospectus, any Permitted Free Writing Prospectus and/or any amendment or supplement thereto, as applicable, is effective
and available for the issuance of the RD Securities. If at any time the SEC shall issue any stop order suspending the effectiveness
of the Registration Statement or prohibiting or suspending the use of the Prospectus or any Prospectus Supplement, the Company
shall use best efforts to obtain the withdrawal of such order at the earliest possible time.


 




    	 	27	 



     


    

 


(e)
Blue Sky. The Company shall file a Form D with respect to the PIPE Securities as required under Regulation D and to provide
a copy thereof to each Buyer promptly after such filing. The Company shall, on or before the Closing Date, 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 Buyers at the Closing pursuant to this Agreement under applicable securities or “Blue Sky” laws of the states
of the United States (or to obtain an exemption from such qualification), and shall provide evidence of any such action so taken
to the Buyers on or prior to the Closing Date. Without limiting any other obligation of the Company under this Agreement, the
Company shall timely make all filings and reports relating to the offer and sale of the Securities required under all applicable
securities laws (including, without limitation, all applicable federal securities laws and all applicable “Blue Sky”
laws), and the Company shall comply with all applicable foreign, federal, state and local laws, statutes, rules, regulations and
the like relating to the offering and sale of the Securities to the Buyers.


 


(f)
Reporting Status. Until the date on which the Buyers shall have sold all of the Securities (the “Reporting Period”),
the Company shall timely file all reports required to be filed with the SEC pursuant to the 1934 Act, and the Company shall not
terminate its status as an issuer required to file reports under the 1934 Act even if the 1934 Act or the rules and regulations
thereunder would no longer require or otherwise permit such termination.


 


(g)
Use of Proceeds. The Company will use the proceeds from the sale of the Securities as described in the Prospectus Supplement,
but not, directly or indirectly, for (i) except as set forth on Schedule 4(d), the satisfaction of any indebtedness of the Company
or any of its Subsidiaries, (ii) the redemption or repurchase of any securities of the Company or any of its Subsidiaries, or
(iii) the settlement of any outstanding litigation.


 


(h)
Financial Information. The Company agrees to send the following to each holder of Warrants (each, an “Investor”)
during the Reporting Period (i) unless the following are filed with the SEC through EDGAR and are available to the public through
the EDGAR system, within one (1) Business Day after the filing thereof with the SEC, a copy of its Annual Reports on Form 10-K
and Quarterly Reports on Form 10-Q, any interim reports or any consolidated balance sheets, income statements, shareholders’
equity statements and/or cash flow statements for any period other than annual, any Current Reports on Form 8-K and any registration
statements (other than on Form S-8) or amendments filed pursuant to the 1933 Act, (ii) unless the following are either filed with
the SEC through EDGAR or are otherwise widely disseminated via a recognized news release service (such as PR Newswire), on the
same day as the release thereof, facsimile copies of all press releases issued by the Company or any of its Subsidiaries and (iii)
unless the following are filed with the SEC through EDGAR, copies of any notices and other information made available or given
to the shareholders of the Company generally, contemporaneously with the making available or giving thereof to the shareholders.


 




    	 	28	 



     


    

 


(i)
Listing. The Company shall promptly secure the listing or designation for quotation (as the case may be) of all of the
Underlying Securities (as defined below) upon each national securities exchange and automated quotation system, if any, upon which
the Common Stock is then listed or designated for quotation (as the case may be) (subject to official notice of issuance) and
shall maintain such listing or designation for quotation (as the case may be) of all Underlying Securities from time to time issuable
under the terms of the Transaction Documents on such national securities exchange or automated quotation system. The Company shall
maintain the Common Stock’s listing or authorization for quotation (as the case may be) on the Principal Market, The New
York Stock Exchange, the NYSE American, the Nasdaq Capital Market, the Nasdaq Global Market or the Nasdaq Global Select Market
(each, an “Eligible Market”). Neither the Company nor any of its Subsidiaries shall take any action which could
be reasonably expected to result in the delisting or suspension of the Common Stock on an Eligible Market. The Company shall pay
all fees and expenses in connection with satisfying its obligations under this Section 4(h). “Underlying Securities”
means the (i) the Common Shares, (ii) the Warrant Shares and (iii) any capital stock of the Company issued or issuable with respect
to the Common Shares, the Warrant Shares, or the Warrants, respectively, including, without limitation, (1) as a result of any
stock split, stock dividend, recapitalization, exchange or similar event or otherwise and (2) shares of capital stock of the Company
into which the shares of Common Stock are converted or exchanged and shares of capital stock of a Successor Entity (as defined
in the Warrants) into which the shares of Common Stock are converted or exchanged, in each case, without regard to any limitations
on exercise of the Warrants.


 


(j)
Fees. The Company shall reimburse the lead Buyer a non-accountable fee of $50,000 for all costs and expenses incurred by
it or its affiliates in connection with the structuring, documentation, negotiation and closing of the transactions contemplated
by the Transaction Documents (including, without limitation, as applicable, all reasonable legal fees of outside counsel and disbursements
of Kelley Drye & Warren, LLP, counsel to the lead Buyer, any other reasonable fees and expenses in connection with the structuring,
documentation, negotiation and closing of the transactions contemplated by the Transaction Documents and due diligence and regulatory
filings in connection therewith) (the “Transaction Expenses”) and shall be withheld by the lead Buyer from
its Purchase Price at the Closing; provided, that the Company shall promptly reimburse Kelley Drye & Warren, LLP on demand
for all Transaction Expenses not so reimbursed through such withholding at the Closing. In addition to the Transaction Expenses,
the Company shall be responsible for the payment of any placement agent’s fees, financial advisory fees, transfer agent
fees, DTC fees or broker’s commissions (other than for Persons engaged by any Buyer) relating to or arising out of the transactions
contemplated hereby (including, without limitation, any fees or commissions payable to the Placement Agent, who is the Company’s
sole placement agent in connection with the transactions contemplated by this Agreement). The Company shall pay, and hold each
Buyer harmless against, any liability, loss or expense (including, without limitation, reasonable attorneys’ fees and out-of-pocket
expenses) arising in connection with any claim relating to any such payment. Except as otherwise set forth in the Transaction
Documents, each party to this Agreement shall bear its own expenses in connection with the sale of the Securities to the Buyers.


 




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(k)
Pledge of Securities. Notwithstanding anything to the contrary contained in this Agreement, the Company acknowledges and
agrees that the PIPE Securities may be pledged by an Investor in connection with a bona fide margin agreement or other loan or
financing arrangement that is secured by the PIPE Securities. The pledge of PIPE Securities shall not be deemed to be a transfer,
sale or assignment of the PIPE Securities hereunder, and no Investor effecting a pledge of PIPE Securities shall be required to
provide the Company with any notice thereof or otherwise make any delivery to the Company pursuant to this Agreement or any other
Transaction Document, including, without limitation, Section 2(g) hereof; provided that an Investor and its pledgee shall be required
to comply with the provisions of Section 2(g) hereof in order to effect a sale, transfer or assignment of PIPE Securities to such
pledgee. The Company hereby agrees to execute and deliver such documentation as a pledgee of the PIPE Securities may reasonably
request in connection with a pledge of the PIPE Securities to such pledgee by a Buyer.


 


(l)
Disclosure of Transactions and Other Material Information.


 


(i)
Disclosure of Transaction. On or before 9:30 a.m., New York time, on the first (1st) Business Day after the date of this
Agreement, the Company shall file a Current Report on Form 8-K describing all the material terms of the transactions contemplated
by the Transaction Documents in the form required by the 1934 Act and attaching all the material Transaction Documents (including,
without limitation, this Agreement (and all schedules to this Agreement) and the form of the Warrants) (including all attachments,
the “8-K Filing”). From and after the filing of the 8-K Filing, the Company shall have disclosed all material,
non-public information (if any) provided to any of the Buyers 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 filing of the 8-K Filing, the Company acknowledges and agrees that any and all confidentiality or similar obligations
under any agreement, whether written or oral, between the Company, any of its Subsidiaries or any of their respective officers,
directors, affiliates, employees or agents, on the one hand, and any of the Buyers or any of their affiliates, on the other hand,
shall terminate.


 




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(ii)
Limitations on Disclosure. The Company shall not, and the Company shall cause each of its Subsidiaries and each of its
and their respective officers, directors, employees and agents not to, provide any Buyer with any material, non-public information
regarding the Company or any of its Subsidiaries from and after the date hereof without the express prior written consent of such
Buyer (which may be granted or withheld in such Buyer’s sole discretion). In the event of a breach of any of the foregoing
covenants, or any of the covenants or agreements contained in any other Transaction Document, by the Company, any of its Subsidiaries,
or any of its or their respective officers, directors, employees and agents (as determined in the reasonable good faith judgment
of such Buyer), in addition to any other remedy provided herein or in the Transaction Documents, such Buyer shall have the right
to make a public disclosure, in the form of a press release, public advertisement or otherwise, of such breach or such material,
non-public information, as applicable, without the prior approval by the Company, any of its Subsidiaries, or any of its or their
respective officers, directors, employees or agents. No Buyer shall have any liability to the Company, any of its Subsidiaries,
or any of its or their respective officers, directors, employees, affiliates, shareholders or agents, for any such disclosure.
To the extent that the Company delivers any material, non-public information to a Buyer without such Buyer’s consent, the
Company hereby covenants and agrees that such Buyer shall not have any duty of confidentiality with respect to, or a duty not
to trade on the basis of, such material, non-public information. Subject to the foregoing, neither the Company, its Subsidiaries
nor any Buyer shall issue any press releases or any other public statements with respect to the transactions contemplated hereby;
provided, however, the Company shall be entitled, without the prior approval of any Buyer, to make the any press release or other
public disclosure with respect to such transactions (i) in substantial conformity with the 8-K Filing and contemporaneously therewith
and (ii) as is required by applicable law and regulations (provided that in the case of clause (i) each Buyer shall be consulted
by the Company in connection with any such press release or other public disclosure prior to its release). Without the prior written
consent of the applicable Buyer (which may be granted or withheld in such Buyer’s sole discretion), the Company shall not
(and shall cause each of its Subsidiaries and affiliates to not) disclose the name of such Buyer in any filing, announcement,
release or otherwise. Notwithstanding anything contained in this Agreement to the contrary and without implication that the contrary
would otherwise be true, the Company expressly acknowledges and agrees that no Buyer shall have (unless expressly agreed to by
a particular Buyer after the date hereof in a written definitive and binding agreement executed by the Company and such particular
Buyer (it being understood and agreed that no Buyer may bind any other Buyer with respect thereto)), any duty of confidentiality
with respect to, or a duty not to trade on the basis of, any material, non-public information regarding the Company or any of
its Subsidiaries.


 


(m)
Additional Issuance of Securities. The Company agrees that for the period commencing on the date hereof and ending on the
date immediately following the 90th calendar day after the Closing Date (the “Restricted Period”), neither
the Company nor any of its Subsidiaries shall directly or indirectly:


 


(i)
file a registration statement under the 1933 Act relating to securities that are not the Common Shares (other than a registration
statement on Form S-8 or such supplements or amendments to registration statements that are outstanding and have been declared
effective by the SEC as of the date hereof (solely to the extent necessary to keep such registration statements effective and
available and not with respect to any Subsequent Placement));


 


(ii)
amend or modify (whether by an amendment, waiver, exchange of securities, or otherwise) any of the Company’s warrants to
purchase Common Stock that are outstanding as of the date hereof; or


 




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(iii)
issue, offer, sell, grant any option or right to purchase, or otherwise dispose of (or announce any issuance, offer, sale, grant
of any option or right to purchase or other disposition of) any equity security or any equity-linked or related security (including,
without limitation, any “equity security” (as that term is defined under Rule 405 promulgated under the 1933 Act)),
any Convertible Securities (as defined below), any debt, any preferred stock or any purchase rights (any such issuance, offer,
sale, grant, disposition or announcement (whether occurring during the Restricted Period or at any time thereafter) is referred
to as a “Subsequent Placement”). Notwithstanding the foregoing, this Section 4(m) shall not apply in respect
of the issuance of (i) shares of Common Stock or options to purchase Common Stock to directors, officers, consultants or employees
of the Company in their capacity as such pursuant to an Approved Stock Plan (as defined below), provided that (1) all such issuances
(taking into account the shares of Common Stock issuable upon exercise of such options) after the date hereof pursuant to this
clause (i) do not, in the aggregate, exceed more than 15% of the Common Stock issued and outstanding immediately prior to the
date hereof and (2) the exercise price of any such options is not lowered, none of such options are amended to increase the number
of shares issuable thereunder and none of the terms or conditions of any such options are otherwise materially changed in any
manner that adversely affects any of the Buyers; (ii) Convertible Securities and/or shares of Common Stock issued upon the conversion
or exercise of Convertible Securities (other than options to purchase Common Stock issued pursuant to an Approved Stock Plan that
are covered by clause (i) above) issued prior to the date hereof or in the Insider Financing (as defined below), provided that
the conversion, exercise or other method of issuance (as the case may be) of any such Convertible Security is made solely pursuant
to the conversion, exercise or other method of issuance (as the case may be) provisions of such Convertible Security that were
in effect on the date immediately prior to the date of this Agreement, the conversion, exercise or issuance price of any such
Convertible Securities (other than options to purchase Common Stock issued pursuant to an Approved Stock Plan that are covered
by clause (i) above) is not lowered, none of such Convertible Securities (other than options to purchase Common Stock issued pursuant
to an Approved Stock Plan that are covered by clause (i) above) are amended to increase the number of shares issuable thereunder
and none of the terms or conditions of any such Convertible Securities (other than options to purchase Common Stock issued pursuant
to an Approved Stock Plan that are covered by clause (i) above) are otherwise materially changed in any manner that adversely
affects any of the Buyers; (iii) the Common Shares, (iv) the Warrant Shares; provided, that the terms of the Warrants are not
amended, modified or changed on or after the Closing Date, (v) shares of Common Stock and/or Convertible Securities issued either
(x) to the Placement Agent in connection with the issuance of the Securities or (y) to the Placement Agent (and/or other underwriters
or placement agents) in connection with a Subsequent Placement; provided, that (I) such shares of Common Stock and/or Convertible
Securities, as applicable, are issued as actual reasonable compensation for services rendered by such Placement Agent (and/or
other underwriters or placement agents) in connection therewith and (II) if such Common Stock and/or Convertible Securities, as
applicable, are issued pursuant to a registration statement (or otherwise are unrestricted securities or available to be resold
pursuant to and effective registration statement), the applicable shares of Common Stock and/or Convertible Securities, as applicable,
shall be subject to a lock-up agreement, in form and substance reasonably satisfactory to the Required Holders, restricting the
resale of such shares of Common Stock and/or Convertible Securities, as applicable, for a period of at least 120 days after the
date of issuance thereof and (vi) shares of Common Stock and Common Stock issued upon the conversion or exercise of Convertible
Securities (other than options to purchase Common Stock issued pursuant to an Approved Stock Plan on or after the date of this
Agreement that are covered by clause (i) above) issued or issuable pursuant to strategic alliances, strategic mergers and acquisitions,
strategic partnerships, strategic license agreements and other similar transactions, provided that (I) the primary purpose of
such issuance is not to raise capital, (II) the purchaser or acquirer of such shares of Common Stock and/or Convertible Securities
in such issuance solely consists of the actual participants in such strategic transaction or the shareholders, partners, members
or Affiliates of the such participants, and (III) to the extent there are multiple participants in such transaction, the number
or amount (as the case may be) of such shares of Common Stock and/or Convertible Securities issued to such Person by the Company
in such transaction shall not be disproportionate to such Person’s actual participation in such strategic transaction (each
of the foregoing in clauses (i) through (v), collectively the “Excluded Securities”). “Approved Stock
Plan” means any employee benefit plan or other agreement which has been approved by the board of directors of the Company
prior to or subsequent to the date hereof pursuant to which shares of Common Stock and options to purchase Common Stock may be
issued to any employee, consultant, officer or director for services provided to the Company in their capacity as such. “Convertible
Securities” means any capital stock or other security of the Company or any of its Subsidiaries that is at any time
and under any circumstances directly or indirectly convertible into, exercisable or exchangeable for, or which otherwise entitles
the holder thereof to acquire, any capital stock or other security of the Company (including, without limitation, Common Stock)
or any of its Subsidiaries.


 




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(n)
Conduct of Business. The business of the Company and its Subsidiaries shall not be conducted in violation of any law, ordinance
or regulation of any Governmental Entity, except where such violations would not reasonably be expected to result, either individually
or in the aggregate, in a Material Adverse Effect.


 


(o)
Dilutive Issuances. For so long as any Warrants remain outstanding, the Company shall not, in any manner, enter into or
affect any Dilutive Issuance (as defined in the Warrants) if the effect of such Dilutive Issuance is to cause the Company to be
required to issue upon exercise of any Warrant any shares of Common Stock in excess of that number of shares of Common Stock which
the Company may issue upon exercise of the Warrants without breaching the Company’s obligations under the rules or regulations
of the Principal Market.


 


(p)
Passive Foreign Investment Company. The Company shall conduct its business, and shall cause its Subsidiaries to conduct
their respective businesses, in such a manner as will ensure that the Company will not be deemed to constitute a passive foreign
investment company within the meaning of Section 1297 of the Code.


 


(q)
Corporate Existence. So long as any Buyer beneficially owns any Warrants, the Company shall not be party to any Fundamental
Transaction (as defined in the Warrants) unless the Company is in compliance with the applicable provisions governing Fundamental
Transactions set forth in the Warrants.


 


(r)
Stock Splits. So long as any Warrants remain outstanding, the Company shall not effect any stock combination, reverse stock
split or other similar transaction (or make any public announcement or disclosure with respect to any of the foregoing) without
the prior written consent of the Required Holders (as defined below).


 


(s)
Exercise Procedures. The form of Exercise Notice (as defined in the Warrants) included in the Warrants sets forth the totality
of the procedures required of the Buyers in order to exercise the Warrants. No legal opinion or other information or instructions
shall be required of the Buyers to exercise their Warrants. The Company shall honor exercises of the Warrants and shall deliver
the Warrant Shares in accordance with the terms, conditions and time periods set forth in the Warrants. Without limiting the preceding
sentences, no ink-original Exercise Notice shall be required, nor shall any medallion guarantee (or other type of guarantee or
notarization) of any Exercise Notice form be required in order to exercise the Warrants.


 




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(t)
Regulation M. The Company will not take any action prohibited by Regulation M under the 1934 Act, in connection with the
distribution of the Securities contemplated hereby.


 


(u)
General Solicitation. None of the Company, any of its affiliates (as defined in Rule 501(b) under the 1933 Act) or any
person acting on behalf of the Company or such affiliate will solicit any offer to buy or offer or sell the PIPE Securities by
means of any form of general solicitation or general advertising within the meaning of Regulation D, including: (i) any advertisement,
article, notice or other communication published in any newspaper, magazine or similar medium or broadcast over television or
radio; and (ii) any seminar or meeting whose attendees have been invited by any general solicitation or general advertising.


 


(v)
Integration. None of the Company, any of its affiliates (as defined in Rule 501(b) under the 1933 Act), or any person acting
on behalf of the Company or such affiliate will sell, offer for sale, or solicit offers to buy or otherwise negotiate in respect
of any security (as defined in the 1933 Act) which will be integrated with the sale of the Securities in a manner which would
require the registration of the PIPE Securities under the 1933 Act or require shareholder approval under the rules and regulations
of the Principal Market and the Company will take all action that is appropriate or necessary to assure that its offerings of
other securities will not be integrated for purposes of the 1933 Act or the rules and regulations of the Principal Market, with
the issuance of PIPE Securities contemplated hereby.


 


(w)
Notice of Disqualification Events. The Company will notify the Buyers 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.


 


(x)
Shareholder Approval. The Company shall provide each shareholder entitled to vote at an annual or special meeting of shareholders
of the Company (the “Shareholder Meeting”), which shall be promptly called and held not later than July 31,
2020 (the “Shareholder Meeting Deadline”), a proxy statement, in a form reasonably acceptable to the Buyers
and Kelley Drye & Warren LLP, at the expense of the Company, with the Company obligated to reimburse the expenses of Kelley
Drye & Warren LLP incurred in connection therewith in an amount not exceed $5,000, soliciting each such shareholder’s
affirmative vote at the Shareholder Meeting for approval of resolutions (“Shareholder Resolutions”) providing
for (x) the issuance of all of the Securities in compliance with the rules and regulations of the Principal Market (without regard
to any limitations on exercise with respect thereto) (the “Transaction Shareholder Approval”, and the date
such Transaction Shareholder Approval is obtained, the “Transaction Shareholder Approval Date”) and (y) the
increase of the authorized shares of the Company from 8,000,000 to at least 9,500,000 (the “Share Increase Shareholder
Approval”, and the date such Share Increase Shareholder Approval is obtained, the “Share Increase Shareholder
Approval Date”), and the Company shall use its reasonable best efforts to solicit its shareholders’ approval of
such resolutions and to cause the Board of Directors of the Company to recommend to the shareholders that they approve such resolutions.
The Company shall be obligated to seek to obtain the Transaction Shareholder Approval and the Share Increase Shareholder Approval
(collectively, the “Shareholder Approval”, and the date such Shareholder Approval is obtained, the “Shareholder
Approval Date”), and the Company shall use its reasonable best efforts to solicit its shareholders’ approval of
such resolutions and to cause the Board of Directors of the Company to recommend to the shareholders that they approve such resolutions.
The Company shall be obligated to seek to obtain the Shareholder Approval by the Shareholder Meeting Deadline. If, despite the
Company’s reasonable best efforts the Shareholder Approval is not obtained on or prior to the Shareholder Meeting Deadline,
the Company shall cause an additional Shareholder Meeting to be held on or prior to December 31, 2020. If, despite the Company’s
reasonable best efforts the Shareholder Approval is not obtained after such subsequent shareholder meetings, the Company shall
cause an additional Shareholder Meeting to be held semi-annually thereafter until such Shareholder Approval is obtained.


 




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(y)
Closing Documents. On or prior to fourteen (14) calendar days after the Closing Date, the Company agrees to deliver, or
cause to be delivered, to each Buyer and Kelley Drye & Warren, LLP a complete closing set of the executed Transaction Documents,
Securities and any other document required to be delivered to any party pursuant to Section 7 hereof or otherwise.


 


5.
REGISTER; TRANSFER AGENT INSTRUCTIONS;
LEGEND.


 


(a)
Register. The Company shall maintain at its principal executive offices (or such other office or agency of the Company
as it may designate by notice to each holder of Securities), a register for the Common Shares and the Warrants in which the Company
shall record the name and address of the Person in whose name the Common Shares and the Warrants have been issued (including the
name and address of each transferee), the number of Common Shares held by such Person and the number of Warrant Shares issuable
upon exercise of the Warrants held by such Person. The Company shall keep the register open and available at all times during
business hours for inspection of any Buyer or its legal representatives.


 


(b)
Transfer Agent Instructions. The Company shall issue irrevocable instructions to its Transfer Agent and any subsequent
transfer agent in a form acceptable to each of the Buyers (the “Irrevocable Transfer Agent Instructions”) to
issue certificates or credit shares to the applicable balance accounts at DTC, registered in the name of each Buyer or its respective
nominee(s), for the Common Shares and the Warrant Shares in such amounts as specified from time to time by each Buyer to the Company
upon the exercise of the Warrants (as the case may be). The Company represents and warrants that no instruction other than the
Irrevocable Transfer Agent Instructions referred to in this Section 5(b) will be given by the Company to its Transfer Agent with
respect to the Securities, and that the Securities shall otherwise be freely transferable on the books and records of the Company,
as applicable, to the extent provided in this Agreement and the other Transaction Documents. If a Buyer effects a sale, assignment
or transfer of the Securities, the Company shall permit the transfer and shall promptly instruct its Transfer Agent to issue one
or more certificates or credit shares to the applicable balance accounts at DTC in such name and in such denominations as specified
by such Buyer to effect such sale, transfer or assignment. The Company acknowledges that a breach by it of its obligations hereunder
will cause irreparable harm to a Buyer. Accordingly, the Company acknowledges that the remedy at law for a breach of its obligations
under this Section 5(b) will be inadequate and agrees, in the event of a breach or threatened breach by the Company of the provisions
of this Section 5(b), that a Buyer shall be entitled, in addition to all other available remedies, to an order and/or injunction
restraining any breach and requiring immediate issuance and transfer, without the necessity of showing economic loss and without
any bond or other security being required. The Company shall cause its counsel to issue each legal opinion referred to in the
Irrevocable Transfer Agent Instructions to the Transfer Agent as follows: (i) at the Closing with respect to the Common Shares,
(ii) upon each exercise of the Warrants (unless such issuance covered by a prior legal opinion previously delivered to the Transfer
Agent), and (iii) on each date a registration statement with respect to the issuance or resale of any of the Securities is declared
effective by the SEC. Any fees (with respect to the Transfer Agent, counsel to the Company or otherwise) associated with the issuance
of such opinions or the removal of any legends on any of the Securities shall be borne by the Company.


 




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(c)
Legends. Each Buyer understands that the PIPE Securities have been issued (or will be issued in the case of the Series
A Warrant Shares) pursuant to an exemption from registration or qualification under the 1933 Act and applicable state securities
laws, and except as set forth below, the Securities shall bear any legend as required by the “blue sky” laws of any
state and a restrictive legend in substantially the following form (and a stop-transfer order may be placed against transfer of
such stock certificates):


 


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


 






    	36



     


    

 


(d)
No Legends on RD Securities; Removal of Legends on PIPE Securities. Certificates evidencing RD Securities shall be unrestricted
and shall not be required to contain any legend. Certificates evidencing PIPE Securities shall not be required to contain the
legend set forth in Section 5(b) above or any other legend (i) while a registration statement (including a Registration Statement)
covering the resale of such PIPE Securities is effective under the 1933 Act, (ii) following any sale of such PIPE Securities pursuant
to Rule 144 (assuming neither the transferor nor the transferee is an affiliate of the Company), (iii) if such PIPE Securities
are eligible to be sold, assigned or transferred under Rule 144 (provided that a Buyer provides the Company with reasonable assurances
that such PIPE Securities are eligible for sale, assignment or transfer under Rule 144 which shall not include an opinion of Buyer’s
counsel), (iv) in connection with a sale, assignment or other transfer (other than under Rule 144), provided that such Buyer provides
the Company with an opinion of counsel to such Buyer, in a generally acceptable form, to the effect that such sale, assignment
or transfer of the PIPE Securities may be made without registration under the applicable requirements of the 1933 Act or (v) if
such legend is not required under applicable requirements of the 1933 Act (including, without limitation, controlling judicial
interpretations and pronouncements issued by the SEC). With respect to RD Securities or, with respect to PIPE Securities, if a
legend is not required pursuant to the foregoing with respect to such PIPE Securities, the Company shall no later than two (2)
Trading Days (or such earlier date as required pursuant to the 1934 Act or other applicable law, rule or regulation for the settlement
of a trade initiated on the date such Buyer delivers such legended certificate representing such Securities to the Company) following
the delivery by a Buyer to the Company or the transfer agent (with notice to the Company) of a certificate representing such RD
Securities or a legended certificate representing such PIPE Securities (endorsed or with stock powers attached, signatures guaranteed,
and otherwise in form necessary to affect the reissuance and/or transfer, if applicable), together with any other deliveries from
such Buyer as may be required above in this Section 5(c), as directed by such Buyer, either: (A) provided that the Company’s
transfer agent is participating in the DTC Fast Automated Securities Transfer Program and such Securities are Common Shares or
Warrant Shares, credit the aggregate number of shares of Common Stock to which such Buyer shall be entitled to such Buyer’s
or its designee’s balance account with DTC through its Deposit/Withdrawal at Custodian system or (B) if the Company’s
transfer agent is not participating in the DTC Fast Automated Securities Transfer Program, issue and deliver (via reputable overnight
courier) to such Buyer, a certificate representing such Securities that is free from all restrictive and other legends, registered
in the name of such Buyer or its designee (the date by which such credit is so required to be made to the balance account of such
Buyer’s or such Buyer’s nominee with DTC or such certificate is required to be delivered to such Buyer pursuant to
the foregoing is referred to herein as the “Share Delivery Deadline”). The Company shall be responsible for
any transfer agent fees or DTC fees with respect to any issuance of Securities or the removal of any legends with respect to any
Securities in accordance herewith.


 




    	 	37	 



     


    

 


(e)
Failure to Timely Deliver; Buy-In. If the Company fails to fail, for any reason or for no reason, to issue and deliver
(or cause to be delivered) to a Buyer (or its designee) by the applicable Share Delivery Deadline, either (I) if the Transfer
Agent is not participating in the DTC Fast Automated Securities Transfer Program, a certificate for the number of Common Shares
or Warrant Shares (as the case may be) to which such Buyer is entitled and register such Common Shares or Warrant Shares (as the
case may be) on the Company’s share register or, if the Transfer Agent is participating in the DTC Fast Automated Securities
Transfer Program, to credit the balance account of such Buyer or such Buyer’s designee with DTC for such number of Common
Shares or Warrant Shares (as the case may be) submitted for legend removal by such Buyer pursuant to Section 5(c) above or (II)
if after the initial effective date of a registration statement covering the resale of the Warrant Shares submitted for legend
removal by such Buyer pursuant to Section 5(c) above, such registration statement is not available for the resale of such shares
of Common Stock (the “Unavailable Shares”) and the Company fails to promptly (x) so notify such Buyer and (y)
deliver the Warrant Shares electronically without any restrictive legend by crediting such aggregate number of Warrant Shares
submitted for legend removal by such Buyer pursuant to Section 5(c) above to such Buyer’s or its designee’s balance
account with DTC through its Deposit/Withdrawal At Custodian system (the event described in the immediately foregoing clause (II)
is hereinafter referred as a “Notice Failure” and together with the event described in clause (I) above, a
“Delivery Failure”), then, in addition to all other remedies available to such Buyer, the Company shall pay
in cash to such Buyer on each day after the Share Delivery Deadline and during such Delivery Failure an amount equal to 2% of
the product of (A) the sum of the number of shares of Common Stock not issued to such Buyer on or prior to the Share Delivery
Deadline and to which such Buyer is entitled, and (B) any trading price of the Common Stock selected by such Buyer in writing
as in effect at any time during the period beginning on the date of the delivery by such Buyer to the Company of the applicable
Common Shares or Warrant Shares (as the case may be) and ending on the applicable Share Delivery Deadline. In addition to the
foregoing, if on or prior to the Required Delivery Date either (I) if the Transfer Agent is not participating in the DTC Fast
Automated Securities Transfer Program, the Company shall fail to issue and deliver a certificate to a Buyer and register such
shares of Common Stock on the Company’s share register or, if the Transfer Agent is participating in the DTC Fast Automated
Securities Transfer Program, credit the balance account of such Buyer or such Buyer’s designee with DTC for the number of
shares of Common Stock to which such Buyer submitted for legend removal by such Buyer pursuant to Section 5(c) above (ii) below
or (II) a Notice Failure occurs, and if on or after such Trading Day such Buyer purchases (in an open market transaction or otherwise)
shares of Common Stock to deliver in satisfaction of a sale by such Buyer of shares of Common Stock submitted for legend removal
by such Buyer pursuant to Section 5(c) above that such Buyer is entitled to receive from the Company (a “Buy-In”),
then the Company shall, within two (2) Trading Days after such Buyer’s request and in such Buyer’s discretion, either
(i) pay cash to such Buyer in an amount equal to such Buyer’s total purchase price (including brokerage commissions and
other out-of-pocket expenses, if any, for the shares of Common Stock so purchased) (the “Buy-In Price”), at
which point the Company’s obligation to so deliver such certificate or credit such Buyer’s balance account shall terminate
and such shares shall be cancelled, or (ii) promptly honor its obligation to so deliver to such Buyer a certificate or certificates
or credit the balance account of such Buyer or such Buyer’s designee with DTC representing such number of shares of Common
Stock that would have been so delivered if the Company timely complied with its obligations hereunder and pay cash to such Buyer
in an amount equal to the excess (if any) of the Buy-In Price over the product of (A) such number of shares of Common Shares or
Warrant Shares (as the case may be) that the Company was required to deliver to such Buyer by the Required Delivery Date multiplied
by (B) the lowest Closing Sale Price (as defined in the Warrants) of the Common Stock on any Trading Day during the period commencing
on the date of the delivery by such Buyer to the Company of the applicable Common Shares or Warrant Shares (as the case may be)
and ending on the date of such delivery and payment under this clause (ii). Nothing shall limit such Buyer’s right to pursue
any other remedies available to it hereunder, at law or in equity, including, without limitation, a decree of specific performance
and/or injunctive relief with respect to the Company’s failure to timely deliver certificates representing shares of Common
Stock (or to electronically deliver such shares of Common Stock) as required pursuant to the terms hereof. Notwithstanding anything
herein to the contrary, with respect to any given Notice Failure and/or Delivery Failure, this Section 5(d) shall not apply to
the applicable Buyer the extent the Company has already paid such amounts in full to such Buyer with respect to such Notice Failure
and/or Delivery Failure, as applicable, pursuant to the analogous sections of the Note or Warrant, as applicable, held by such
Buyer.


 




    	 	38	 



     


    

 


(f)
FAST Compliance. While any Warrants remain outstanding, the Company shall maintain a transfer agent that participates in
the DTC Fast Automated Securities Transfer Program.


 


6.
CONDITIONS TO THE COMPANY’S OBLIGATION
TO SELL.


 


The
obligation of the Company hereunder to issue and sell the Common Shares and the related Warrants to each Buyer at the Closing
is subject to the satisfaction, at or before the Closing Date, of each of the following conditions, provided that these conditions
are for the Company’s sole benefit and may be waived by the Company at any time in its sole discretion by providing each
Buyer with prior written notice thereof:


 


(a)
Such Buyer shall have executed each of the other Transaction Documents to which it is a party and delivered the same to the Company.


 


(b)
Such Buyer and each other Buyer shall have delivered to the Company the Purchase Price (less, in the case of any Buyer, the amounts
withheld pursuant to Section 4(j)) for the Common Shares and the related Warrants being purchased by such Buyer at the Closing
by wire transfer of immediately available funds in accordance with the Flow of Funds Letter.


 


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


 


7.
CONDITIONS TO EACH BUYER’S OBLIGATION
TO PURCHASE.


 


The
obligation of each Buyer hereunder to purchase its Common Shares and its related Warrants at the Closing is subject to the satisfaction,
at or before the Closing Date, of each of the following conditions, provided that these conditions are for each Buyer’s
sole benefit and may be waived by such Buyer at any time in its sole discretion by providing the Company with prior written notice
thereof:


 


(a)
The Company shall have duly executed and delivered to such Buyer each of the Transaction Documents and the Company shall have
duly executed and delivered to such Buyer (x) such aggregate number of Common Shares set forth across from such Buyer’s
name in column (3) of the Schedule of Buyers, (y) Series A Warrants (initially for such aggregate number of Series A Warrant Shares
as is set forth across from such Buyer’s name in column (4) of the Schedule of Buyers) and (z) Series B Warrants (initially
for such aggregate number of Series B Warrant Shares as is set forth across from such Buyer’s name in column (4) of the
Schedule of Buyers), in each case, as being purchased by such Buyer at the Closing pursuant to this Agreement.


 




    	 	39	 



     


    

 


(b)
Such Buyer shall have received the opinion of TroyGould PC, the Company’s counsel, dated as of the Closing Date, in the
form acceptable to such Buyer.


 


(c)
The Company shall have delivered to such Buyer a copy of the Irrevocable Transfer Agent Instructions, in the form acceptable to
such Buyer, which instructions shall have been delivered to and acknowledged in writing by the Company’s transfer agent.


 


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


 


(e)
The Company shall have delivered to such Buyer a certificate evidencing the Company’s qualification as a foreign corporation
and good standing issued by the Secretary of State (or comparable office) of each jurisdiction in which the Company conducts business
and is required to so qualify, as of a date within ten (10) days of the Closing Date.


 


(f)
The Company shall have delivered to such Buyer a certificate, in the form acceptable to such Buyer, executed by the Secretary
of the Company and dated as of the Closing Date, as to (i) the resolutions consistent with Section 3(b) as adopted by the Company’s
board of directors in a form reasonably acceptable to such Buyer, (ii) the Articles of Incorporation of the Company and (iii)
the Bylaws of the Company, each as in effect at the Closing.


 


(g)
Each and every representation and warranty of the Company shall be true and correct as of the date when made and as of the Closing
Date as though originally made at that time (except for representations and warranties that speak as of a specific date, which
shall be true and correct as of such specific date) and the Company shall have performed, satisfied and complied in all respects
with the covenants, agreements and conditions required to be performed, satisfied or complied with by the Company at or prior
to the Closing Date. Such Buyer shall have received a certificate, duly executed by the Chief Executive Officer of the Company,
dated as of the Closing Date, to the foregoing effect and as to such other matters as may be reasonably requested by such Buyer
in the form acceptable to such Buyer.


 


(h)
The Company shall have delivered to such Buyer a letter from the Company’s transfer agent certifying the number of shares
of Common Stock outstanding on the Closing Date immediately prior to the Closing.


 


(i)
The Common Stock (A) shall be designated for quotation or listed (as applicable) on the Principal Market and (B) shall not have
been suspended, as of the Closing Date, by the SEC or the Principal Market from trading on the Principal Market nor shall suspension
by the SEC or the Principal Market have been threatened, as of the Closing Date, either (I) in writing by the SEC or the Principal
Market or (II) by falling below the minimum maintenance requirements of the Principal Market.


 


(j)
The Company shall have obtained all governmental, regulatory or third party consents and approvals, if any, necessary for the
sale of the Securities, including without limitation, those required by the Principal Market, if any. No statute, rule, regulation,
executive order, decree, ruling or injunction shall have been enacted, entered, promulgated or endorsed by any court or Governmental
Entity of competent jurisdiction that prohibits the consummation of any of the transactions contemplated by the Transaction Documents.


 




    	 	40	 



     


    

 


(k)
Since the date of execution of this Agreement, no event or series of events shall have occurred that reasonably would have or
result in a Material Adverse Effect.


 


(l)
The Company shall have obtained approval of the Principal Market to list or designate for quotation (as the case may be) the Common
Shares and the Warrant Shares.


 


(m)
Such Buyer shall have received a letter on the letterhead of the Company, duly executed by the Chief Executive Officer or Chief
Financial Officer of the Company, setting forth the wire amounts of each Buyer and the wire transfer instructions of the Company
(the “Flow of Funds Letter”).


 


(n)
From the date hereof to the Closing Date, (i) trading in the Common Stock shall not have been suspended by the SEC or the Principal
Market (except for any suspension of trading of limited duration agreed to by the Company, which suspension shall be terminated
prior to the Closing), and, (ii) at any time prior to the Closing Date, trading in securities generally as reported by Bloomberg
L.P. shall not have been suspended or limited, or minimum prices shall not have been established on securities whose trades are
reported by such service, or on the Principal Market, nor shall a banking moratorium have been declared either by the United States
or New York State authorities nor shall there have occurred any material outbreak or escalation of hostilities or other national
or international calamity of such magnitude in its effect on, or any material adverse change in, any financial market which, in
each case, in the reasonable judgment of each Buyer, makes it impracticable or inadvisable to purchase the Securities at the Closing


 


(o)
The Registration Statement shall be effective and available for the issuance and sale of the RD Securities hereunder and the Company
shall have delivered to such Buyer the Prospectus and the Prospectus Supplement as required thereunder.


 


(p)
The Company and its Subsidiaries shall have delivered to such Buyer such other documents, instruments or certificates relating
to the transactions contemplated by this Agreement as such Buyer or its counsel may reasonably request.


 


8.
TERMINATION.


 


In
the event that the Closing shall not have occurred with respect to a Buyer within five (5) days of the date hereof, then such
Buyer shall have the right to terminate its obligations under this Agreement with respect to itself at any time on or after the
close of business on such date without liability of such Buyer to any other party; provided, however, (i) the right to terminate
this Agreement under this Section 8 shall not be available to such Buyer if the failure of the transactions contemplated by this
Agreement to have been consummated by such date is the result of such Buyer’s breach of this Agreement and (ii) the abandonment
of the sale and purchase of the Common Shares and the Warrants shall be applicable only to such Buyer providing such written notice,
provided further that no such termination shall affect any obligation of the Company under this Agreement to reimburse such Buyer
for the expenses described in Section 4(j) above. Nothing contained in this Section 8 shall be deemed to release any party from
any liability for any breach by such party of the terms and provisions of this Agreement or the other Transaction Documents or
to impair the right of any party to compel specific performance by any other party of its obligations under this Agreement or
the other Transaction Documents.


 




    	 	41	 



     


    

 


9.
MISCELLANEOUS.


 


(a)
Governing Law; Jurisdiction; Jury Trial. All questions concerning the construction, validity, enforcement and interpretation
of this Agreement shall be governed by the internal laws of the State of New York, without giving effect to any choice of law
or conflict of law provision or rule (whether of the State of New York or any other jurisdictions) that would cause the application
of the laws of any jurisdictions other than the State of New York. The Company 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 under any of the other Transaction Documents or with any transaction contemplated hereby or thereby,
and hereby irrevocably waives, and agrees not to assert in any suit, action or proceeding, any claim that it is not personally
subject to the jurisdiction of any such court, that such suit, action or proceeding is brought in an inconvenient forum or that
the venue of such suit, action or proceeding is improper. Each party hereby irrevocably waives personal service of process and
consents to process being served in any such suit, action or proceeding by mailing a copy thereof to such party at the address
for such notices to it under this Agreement and agrees that such service shall constitute good and sufficient service of process
and notice thereof. Nothing contained herein shall be deemed to limit in any way any right to serve process in any manner permitted
by law. Nothing contained herein shall be deemed or operate to preclude any Buyer from bringing suit or taking other legal action
against the Company in any other jurisdiction to collect on the Company’s obligations to such Buyer or to enforce a judgment
or other court ruling in favor of such Buyer. EACH PARTY HEREBY IRREVOCABLY WAIVES ANY RIGHT IT MAY HAVE TO, AND AGREES NOT
TO REQUEST, A JURY TRIAL FOR THE ADJUDICATION OF ANY DISPUTE HEREUNDER OR UNDER ANY OTHER TRANSACTION DOCUMENT OR IN CONNECTION
WITH OR ARISING OUT OF THIS AGREEMENT, ANY OTHER TRANSACTION DOCUMENT OR ANY TRANSACTION CONTEMPLATED HEREBY OR THEREBY.


 


(b)
Counterparts. This Agreement may be executed in two or more identical counterparts, all of which shall be considered one
and the same agreement and shall become effective when counterparts have been signed by each party and delivered to the other
party. In the event that any signature is delivered by facsimile transmission or by an e-mail which contains a portable document
format (.pdf) file of an executed signature page, such signature page 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 signature page were an original
thereof.


 


(c)
Headings; Gender. The headings of this Agreement are for convenience of reference and shall not form part of, or affect
the interpretation of, this Agreement. Unless the context clearly indicates otherwise, each pronoun herein shall be deemed to
include the masculine, feminine, neuter, singular and plural forms thereof. The terms “including,” “includes,”
“include” and words of like import shall be construed broadly as if followed by the words “without limitation.”
The terms “herein,” “hereunder,” “hereof” and words of like import refer to this entire Agreement
instead of just the provision in which they are found.


 




    	 	42	 



     


    

 


(d)
Severability; Maximum Payment Amounts. If any provision of this Agreement is prohibited by law or otherwise determined
to be invalid or unenforceable by a court of competent jurisdiction, the provision that would otherwise be prohibited, invalid
or unenforceable shall be deemed amended to apply to the broadest extent that it would be valid and enforceable, and the invalidity
or unenforceability of such provision shall not affect the validity of the remaining provisions of this Agreement so long as this
Agreement as so modified continues to express, without material change, the original intentions of the parties as to the subject
matter hereof and the prohibited nature, invalidity or unenforceability of the provision(s) in question does not substantially
impair the respective expectations or reciprocal obligations of the parties or the practical realization of the benefits that
would otherwise be conferred upon the parties. The parties will endeavor in good faith negotiations to replace the prohibited,
invalid or unenforceable provision(s) with a valid provision(s), the effect of which comes as close as possible to that of the
prohibited, invalid or unenforceable provision(s). Notwithstanding anything to the contrary contained in this Agreement or any
other Transaction Document (and without implication that the following is required or applicable), it is the intention of the
parties that in no event shall amounts and value paid by the Company and/or any of its Subsidiaries (as the case may be), or payable
to or received by any of the Buyers, under the Transaction Documents (including without limitation, any amounts that would be
characterized as “interest” under applicable law) exceed amounts permitted under any applicable law. Accordingly,
if any obligation to pay, payment made to any Buyer, or collection by any Buyer pursuant the Transaction Documents is finally
judicially determined to be contrary to any such applicable law, such obligation to pay, payment or collection shall be deemed
to have been made by mutual mistake of such Buyer, the Company and its Subsidiaries and such amount shall be deemed to have been
adjusted with retroactive effect to the maximum amount or rate of interest, as the case may be, as would not be so prohibited
by the applicable law. Such adjustment shall be effected, to the extent necessary, by reducing or refunding, at the option of
such Buyer, the amount of interest or any other amounts which would constitute unlawful amounts required to be paid or actually
paid to such Buyer under the Transaction Documents. For greater certainty, to the extent that any interest, charges, fees, expenses
or other amounts required to be paid to or received by such Buyer under any of the Transaction Documents or related thereto are
held to be within the meaning of “interest” or another applicable term to otherwise be violative of applicable law,
such amounts shall be pro-rated over the period of time to which they relate.


 




    	 	43	 



     


    

 


(e)
Entire Agreement; Amendments. This Agreement, the other Transaction Documents and the schedules and exhibits attached hereto
and thereto and the instruments referenced herein and therein supersede all other prior oral or written agreements between the
Buyers, the Company, its Subsidiaries, their affiliates and Persons acting on their behalf, including, without limitation, any
transactions by any Buyer with respect to Common Stock or the Securities, and the other matters contained herein and therein,
and this Agreement, the other Transaction Documents, the schedules and exhibits attached hereto and thereto and the instruments
referenced herein and therein contain the entire understanding of the parties solely with respect to the matters covered herein
and therein; provided, however, nothing contained in this Agreement or any other Transaction Document (other than pursuant to
those certain waivers entered into on or prior to the date hereof, each by and between the Company and a holder of Series D Preferred
Stock of the Company, reducing the requirement to reserve shares of Common Stock as described therein) shall (or shall be deemed
to) (i) have any effect on any agreements any Buyer has entered into with, or any instruments any Buyer has received from, the
Company or any of its Subsidiaries prior to the date hereof with respect to any prior investment made by such Buyer in the Company
or (ii) waive, alter, modify or amend in any respect any obligations of the Company or any of its Subsidiaries, or any rights
of or benefits to any Buyer or any other Person, in any agreement entered into prior to the date hereof between or among the Company
and/or any of its Subsidiaries and any Buyer, or any instruments any Buyer received from the Company and/or any of its Subsidiaries
prior to the date hereof, and all such agreements and instruments shall continue in full force and effect. Except as specifically
set forth herein or therein, neither the Company nor any Buyer makes any representation, warranty, covenant or undertaking with
respect to such matters. For clarification purposes, the Recitals are part of this Agreement. No provision of this Agreement may
be amended other than by an instrument in writing signed by the Company and the Required Holders (as defined below), and any amendment
to any provision of this Agreement made in conformity with the provisions of this Section 9(e) shall be binding on all Buyers
and holders of Securities, as applicable, provided that no such amendment shall be effective to the extent that it (A) applies
to less than all of the holders of the Securities then outstanding or (B) imposes any obligation or liability on any Buyer without
such Buyer’s prior written consent (which may be granted or withheld in such Buyer’s sole discretion). No waiver shall
be effective unless it is in writing and signed by an authorized representative of the waiving party, provided that the Required
Holders may waive any provision of this Agreement, and any waiver of any provision of this Agreement made in conformity with the
provisions of this Section 9(e) shall be binding on all Buyers and holders of Securities, as applicable, provided that no such
waiver shall be effective to the extent that it (1) applies to less than all of the holders of the Securities then outstanding
(unless a party gives a waiver as to itself only) or (2) imposes any obligation or liability on any Buyer without such Buyer’s
prior written consent (which may be granted or withheld in such Buyer’s sole discretion). [No consideration (other than
reimbursement of legal fees) shall be offered or paid to any Person to amend or consent to a waiver or modification of any provision
of any of the Transaction Documents unless the same consideration also is offered to all of the parties to the Transaction Documents,
all holders of the Common Shares, or all holders of the Warrants (as the case may be). From the date hereof and while any Warrants
are outstanding, the Company shall not be permitted to receive any consideration from a Buyer or a holder of Warrants that is
not otherwise contemplated by the Transaction Documents in order to, directly or indirectly, induce the Company or any Subsidiary
(i) to treat such Buyer or holder of Warrants in a manner that is more favorable than to other similarly situated Buyers or holders
of Warrants, as applicable, or (ii) to treat any Buyer(s) or holder(s) of Warrants in a manner that is less favorable than the
Buyer or holder of Warrants that is paying such consideration; provided, however, that the determination of whether a Buyer has
been treated more or less favorably than another Buyer shall disregard any securities of the Company purchased or sold by any
Buyer.] The Company has not, directly or indirectly, made any agreements with any Buyers relating to the terms or conditions of
the transactions contemplated by the Transaction Documents except as set forth in the Transaction Documents. Without limiting
the foregoing, the Company confirms that, except as set forth in this Agreement, no Buyer has made any commitment or promise or
has any other obligation to provide any financing to the Company, any Subsidiary or otherwise. As a material inducement for each
Buyer to enter into this Agreement, the Company expressly acknowledges and agrees that (x) no due diligence or other investigation
or inquiry conducted by a Buyer, any of its advisors or any of its representatives shall affect such Buyer’s right to rely
on, or shall modify or qualify in any manner or be an exception to any of, the Company’s representations and warranties
contained in this Agreement or any other Transaction Document and (y) unless a provision of this Agreement or any other Transaction
Document is expressly preceded by the phrase “except as disclosed in the SEC Documents,” nothing contained in any
of the SEC Documents shall affect such Buyer’s right to rely on, or shall modify or qualify in any manner or be an exception
to any of, the Company’s representations and warranties contained in this Agreement or any other Transaction Document. “Required
Holders” means (I) prior to the Closing Date, Buyers entitled to purchase, in the aggregate, at least a majority of
the number of Common Shares at the Closing and (II) on or after the Closing Date, holders of, in the aggregate, at least a majority
of the Underlying Securities as of such time (excluding any Underlying Securities held by the Company or any of its Subsidiaries
as of such time) issued or issuable hereunder or pursuant to the Warrants provided, that such Buyers or holders of Underlying
Securities, as applicable, must include ___________________ so long as it beneficially owns any of the Underlying Securities
(on an as-exercised basis without regard to any limitations on exercise thereof).


 




    	 	44	 



     


    

 


(f)
Notices. Any notices, consents, waivers or other communications required or permitted to be given under the terms of this
Agreement must be in writing and will be deemed to have been delivered: (i) upon receipt, when delivered personally; (ii) upon
receipt, when sent by facsimile (provided confirmation of transmission is mechanically or electronically generated and kept on
file by the sending party) or electronic mail (provided that such sent email is kept on file (whether electronically or otherwise)
by the sending party and the sending party does not receive an automatically generated message from the recipient’s email
server that such e-mail could not be delivered to such recipient); or (iii) one (1) Business Day after deposit with an overnight
courier service with next day delivery specified, in each case, properly addressed to the party to receive the same. The addresses,
facsimile numbers and e-mail addresses for such communications shall be:


 


If
to the Company:


 


Sigma
Labs, Inc.


3900
Paseo del Sol


Santa
Fe, NM 87507


Telephone:
(505) 984-3251


Attention:
Chief Executive Officer


Email:
rice@sigmalabsinc.com


 


With
a copy (for informational purposes only) to:


 


TroyGould
PC


1801
Century Park East, Suite 1600


Los
Angeles, CA 90067


Telephone:
(310) 553-4441


Attention:
Darren Freedman


Email:
dfreedman@troygould.com


 




    	 	45	 



     


    

 


If
to the Transfer Agent:


 


Issuer
Direct Corporation


1981
Murray Holladay Road, Suite 100


Salt
Lake City, UT 84117


Telephone:
(801) 272-9294


Attention:
Julie Felix


Email:
Julie.felix@issuerdirect.com


 


If
to a Buyer, to its address, e-mail address and facsimile number set forth on the Schedule of Buyers, with copies to such Buyer’s
representatives as set forth on the Schedule of Buyers,


 


with
a copy (for informational purposes only) to:


 


Kelley
Drye & Warren LLP


101
Park Avenue


New
York, NY 10178


Telephone:
(212) 808-7540


Facsimile:
(212) 808-7897


Attention:
Michael A. Adelstein, Esq.


E-mail:
madelstein@kelleydrye.com


 


or
to such other address, e-mail address and/or facsimile number and/or to the attention of such other Person as the recipient party
has specified by written notice given to each other party five (5) days prior to the effectiveness of such change, provided that
Kelley Drye & Warren LLP shall only be provided copies of notices sent to the lead Buyer. Written confirmation of receipt
(A) given by the recipient of such notice, consent, waiver or other communication, (B) mechanically or electronically generated
by the sender’s facsimile machine or e-mail containing the time, date, recipient facsimile number and, with respect to each
facsimile transmission, an image of the first page of such transmission or (C) provided by an overnight courier service shall
be rebuttable evidence of personal service, receipt by facsimile or receipt from an overnight courier service in accordance with
clause (i), (ii) or (iii) above, respectively.


 


(g)
Successors and Assigns. This Agreement shall be binding upon and inure to the benefit of the parties and their respective
successors and assigns, including any purchasers of any of the Warrants (but excluding any purchasers of Underlying Securities,
unless pursuant to a written assignment by such Buyer). The Company shall not assign this Agreement or any rights or obligations
hereunder without the prior written consent of the Required Holders, including, without limitation, by way of a Fundamental Transaction
(as defined in the Warrants) (unless the Company is in compliance with the applicable provisions governing Fundamental Transactions
set forth in the Warrants). A Buyer may assign some or all of its rights hereunder in connection with any transfer of any of its
Securities without the consent of the Company, in which event such assignee shall be deemed to be a Buyer hereunder with respect
to such assigned rights.


 


(h)
No Third Party Beneficiaries. This Agreement is intended for the benefit of the parties hereto and their respective permitted
successors and assigns, and is not for the benefit of, nor may any provision hereof be enforced by, any other Person, other than
the Indemnitees referred to in Section 9(k).


 




    	 	46	 



     


    

 


(i)
Survival. The representations, warranties, agreements and covenants shall survive the Closing. Each Buyer shall be responsible
only for its own representations, warranties, agreements and covenants hereunder.


 


(j)
Further Assurances. Each party shall do and perform, or cause to be done and performed, all such further acts and things,
and shall execute and deliver all such other agreements, certificates, instruments and documents, as any other party may reasonably
request in order to carry out the intent and accomplish the purposes of this Agreement and the consummation of the transactions
contemplated hereby.


 


(k)
Indemnification.


 


(i)
In consideration of each Buyer’s execution and delivery of the Transaction Documents and acquiring the Securities thereunder
and in addition to all of the Company’s other obligations under the Transaction Documents, the Company shall defend, protect,
indemnify and hold harmless each Buyer and each holder of any Securities and all of their shareholders, partners, members, officers,
directors, employees and direct or indirect investors and any of the foregoing Persons’ agents or other representatives
(including, without limitation, those retained in connection with the transactions contemplated by this Agreement) (collectively,
the “Indemnitees”) from and against any and all actions, causes of action, suits, claims, losses, costs, penalties,
fees, liabilities and damages, and expenses in connection therewith (irrespective of whether any such Indemnitee is a party to
the action for which indemnification hereunder is sought), and including reasonable attorneys’ fees and disbursements (the
“Indemnified Liabilities”), incurred by any Indemnitee as a result of, or arising out of, or relating to (i)
any misrepresentation or breach of any representation or warranty made by the Company or any Subsidiary in any of the Transaction
Documents, (ii) any breach of any covenant, agreement or obligation of the Company or any Subsidiary contained in any of the Transaction
Documents or (iii) any cause of action, suit, proceeding or claim brought or made against such Indemnitee by a third party (including
for these purposes a derivative action brought on behalf of the Company or any Subsidiary) or which otherwise involves such Indemnitee
that arises out of or results from (A) the execution, delivery, performance or enforcement of any of the Transaction Documents,
(B) any transaction financed or to be financed in whole or in part, directly or indirectly, with the proceeds of the issuance
of the Securities, (C) any disclosure properly made by such Buyer pursuant to Section 4(k), or (D) the status of such Buyer or
holder of the Securities either as an investor in the Company pursuant to the transactions contemplated by the Transaction Documents
or as a party to this Agreement (including, without limitation, as a party in interest or otherwise in any action or proceeding
for injunctive or other equitable relief). To the extent that the foregoing undertaking by the Company may be unenforceable for
any reason, the Company shall make the maximum contribution to the payment and satisfaction of each of the Indemnified Liabilities
which is permissible under applicable law.


 




    	 	47	 



     


    

 


(ii)
Promptly after receipt by an Indemnitee under this Section 9(k) of notice of the commencement of any action or proceeding (including
any governmental action or proceeding) involving an Indemnified Liability, such Indemnitee shall, if a claim in respect thereof
is to be made against the Company under this Section 9(k), deliver to the Company a written notice of the commencement thereof,
and the Company shall have the right to participate in, and, to the extent the Company so desires, to assume control of the defense
thereof with counsel mutually satisfactory to the Company and the Indemnitee; provided, however, that an Indemnitee shall have
the right to retain its own counsel with the fees and expenses of such counsel to be paid by the Company if: (A) the Company has
agreed in writing to pay such fees and expenses; (B) the Company shall have failed promptly to assume the defense of such Indemnified
Liability and to employ counsel reasonably satisfactory to such Indemnitee in any such Indemnified Liability; or (C) the named
parties to any such Indemnified Liability (including any impleaded parties) include both such Indemnitee and the Company, and
such Indemnitee shall have been advised by counsel that a conflict of interest is likely to exist if the same counsel were to
represent such Indemnitee and the Company (in which case, if such Indemnitee notifies the Company in writing that it elects to
employ separate counsel at the expense of the Company, then the Company shall not have the right to assume the defense thereof
and such counsel shall be at the expense of the Company), provided further, that in the case of clause (C) above the Company shall
not be responsible for the reasonable fees and expenses of more than one (1) separate legal counsel for the Indemnitees. The Indemnitee
shall reasonably cooperate with the Company in connection with any negotiation or defense of any such action or Indemnified Liability
by the Company and shall furnish to the Company all information reasonably available to the Indemnitee which relates to such action
or Indemnified Liability. The Company shall keep the Indemnitee reasonably apprised at all times as to the status of the defense
or any settlement negotiations with respect thereto. The Company shall not be liable for any settlement of any action, claim or
proceeding effected without its prior written consent, provided, however, that the Company shall not unreasonably withhold, delay
or condition its consent. The Company shall not, without the prior written consent of the Indemnitee, consent to entry of any
judgment or enter into any settlement or other compromise which does not include as an unconditional term thereof the giving by
the claimant or plaintiff to such Indemnitee of a release from all liability in respect to such Indemnified Liability or litigation,
and such settlement shall not include any admission as to fault on the part of the Indemnitee. Following indemnification as provided
for hereunder, the Company shall be subrogated to all rights of the Indemnitee with respect to all third parties, firms or corporations
relating to the matter for which indemnification has been made. The failure to deliver written notice to the Company within a
reasonable time of the commencement of any such action shall not relieve the Company of any liability to the Indemnitee under
this Section 9(k), except to the extent that the Company is materially and adversely prejudiced in its ability to defend such
action.


 


(iii)
The indemnification required by this Section 9(k) shall be made by periodic payments of the amount thereof during the course of
the investigation or defense, within ten (10) days after bills are received or Indemnified Liabilities are incurred.


 




    	 	48	 



     


    

 


(iv)
The indemnity agreement contained herein shall be in addition to (A) any cause of action or similar right of the Indemnitee against
the Company or others, and (B) any liabilities the Company may be subject to pursuant to the law.


 


(l)
Construction. The language used in this Agreement will be deemed to be the language chosen by the parties to express their
mutual intent, and no rules of strict construction will be applied against any party. No specific representation or warranty shall
limit the generality or applicability of a more general representation or warranty. Each and every reference to share prices,
shares of Common Stock and any other numbers in this Agreement that relate to the Common Stock shall be automatically adjusted
for any stock splits, stock dividends, stock combinations, recapitalizations or other similar transactions that occur with respect
to the Common Stock after the date of this Agreement. Notwithstanding anything in this Agreement to the contrary, for the avoidance
of doubt, nothing contained herein shall constitute a representation or warranty against, or a prohibition of, any actions with
respect to the borrowing of, arrangement to borrow, identification of the availability of, and/or securing of, securities of the
Company in order for such Buyer (or its broker or other financial representative) to effect short sales or similar transactions
in the future.


 


(m)
Remedies. Each Buyer and in the event of assignment by Buyer of its rights and obligations hereunder, each holder of Securities,
shall have all rights and remedies set forth in the Transaction Documents and all rights and remedies which such holders have
been granted at any time under any other agreement or contract and all of the rights which such holders have under any law. Any
Person having any rights under any provision of this Agreement shall be entitled to enforce such rights specifically (without
posting a bond or other security), to recover damages by reason of any breach of any provision of this Agreement and to exercise
all other rights granted by law. Furthermore, the Company recognizes that in the event that it or any Subsidiary fails to perform,
observe, or discharge any or all of its or such Subsidiary’s (as the case may be) obligations under the Transaction Documents,
any remedy at law would inadequate relief to the Buyers. The Company therefore agrees that the Buyers shall be entitled to specific
performance and/or temporary, preliminary and permanent injunctive or other equitable relief from any court of competent jurisdiction
in any such case without the necessity of proving actual damages and without posting a bond or other security. The remedies provided
in this Agreement and the other Transaction Documents shall be cumulative and in addition to all other remedies available under
this Agreement and the other Transaction Documents, at law or in equity (including a decree of specific performance and/or other
injunctive relief).


 


(n)
Withdrawal Right. Notwithstanding anything to the contrary contained in (and without limiting any similar provisions of)
the Transaction Documents, whenever any Buyer exercises a right, election, demand or option under a Transaction Document and the
Company or any Subsidiary does not timely perform its related obligations within the periods therein provided, then such Buyer
may rescind or withdraw, in its sole discretion from time to time upon written notice to the Company or such Subsidiary (as the
case may be), any relevant notice, demand or election in whole or in part without prejudice to its future actions and rights.


 




    	 	49	 



     


    

 


(o)
Payment Set Aside; Currency. To the extent that the Company makes a payment or payments to any Buyer hereunder or pursuant
to any of the other Transaction Documents or any of the Buyers enforce or exercise their rights hereunder or thereunder, and such
payment or payments or the proceeds of such enforcement or exercise or any part thereof are subsequently invalidated, declared
to be fraudulent or preferential, set aside, recovered from, disgorged by or are required to be refunded, repaid or otherwise
restored to the Company, a trustee, receiver or any other Person under any law (including, without limitation, any bankruptcy
law, foreign, state or federal law, common law or equitable cause of action), then to the extent of any such restoration the obligation
or part thereof originally intended to be satisfied shall be revived and continued in full force and effect as if such payment
had not been made or such enforcement or setoff had not occurred. Unless otherwise expressly indicated, all dollar amounts referred
to in this Agreement and the other Transaction Documents are in United States Dollars (“U.S. Dollars”), and
all amounts owing under this Agreement and all other Transaction Documents shall be paid in U.S. Dollars. All amounts denominated
in other currencies (if any) shall be converted into the U.S. Dollar equivalent amount in accordance with the Exchange Rate on
the date of calculation. “Exchange Rate” means, in relation to any amount of currency to be converted into
U.S. Dollars pursuant to this Agreement, the U.S. Dollar exchange rate as published in the Wall Street Journal on the relevant
date of calculation.


 


(p)
Judgment Currency.


 


(i)
If for the purpose of obtaining or enforcing judgment against the Company in connection with this Agreement or any other Transaction
Document in any court in any jurisdiction it becomes necessary to convert into any other currency (such other currency being hereinafter
in this Section 9(p) referred to as the “Judgment Currency”) an amount due in US Dollars under this Agreement,
the conversion shall be made at the Exchange Rate prevailing on the Trading Day immediately preceding:


 


(1)
the date actual payment of the amount due, in the case of any proceeding in the courts of New York or in the courts of any other
jurisdiction that will give effect to such conversion being made on such date: or


 


(2)
the date on which the foreign court determines, in the case of any proceeding in the courts of any other jurisdiction (the date
as of which such conversion is made pursuant to this Section 9(p)(i)(1) being hereinafter referred to as the “Judgment
Conversion Date”).


 


(ii)
If in the case of any proceeding in the court of any jurisdiction referred to in Section 9(p)(i)(1) above, there is a change in
the Exchange Rate prevailing between the Judgment Conversion Date and the date of actual payment of the amount due, the applicable
party shall pay such adjusted amount as may be necessary to ensure that the amount paid in the Judgment Currency, when converted
at the Exchange Rate prevailing on the date of payment, will produce the amount of US Dollars which could have been purchased
with the amount of Judgment Currency stipulated in the judgment or judicial order at the Exchange Rate prevailing on the Judgment
Conversion Date.


 


(iii)
Any amount due from the Company under this provision shall be due as a separate debt and shall not be affected by judgment being
obtained for any other amounts due under or in respect of this Agreement or any other Transaction Document.


 




    	 	50	 



     


    

 


(q)
Independent Nature of Buyers’ Obligations and Rights. The obligations of each Buyer under the Transaction Documents
are several and not joint with the obligations of any other Buyer, and no Buyer shall be responsible in any way for the performance
of the obligations of any other Buyer under any Transaction Document. Nothing contained herein or in any other Transaction Document,
and no action taken by any Buyer pursuant hereto or thereto, shall be deemed to constitute the Buyers as, and the Company acknowledges
that the Buyers do not so constitute, a partnership, an association, a joint venture or any other kind of group or entity, or
create a presumption that the Buyers are in any way acting in concert or as a group or entity, and the Company shall not assert
any such claim with respect to such obligations or the transactions contemplated by the Transaction Documents or any matters,
and the Company acknowledges that the Buyers are not acting in concert or as a group, and the Company shall not assert any such
claim, with respect to such obligations or the transactions contemplated by the Transaction Documents. The decision of each Buyer
to purchase Securities pursuant to the Transaction Documents has been made by such Buyer independently of any other Buyer. Each
Buyer acknowledges that no other Buyer has acted as agent for such Buyer in connection with such Buyer making its investment hereunder
and that no other Buyer will be acting as agent of such Buyer in connection with monitoring such Buyer’s investment in the
Securities or enforcing its rights under the Transaction Documents. The Company and each Buyer confirms that each Buyer has independently
participated with the Company and its Subsidiaries in the negotiation of the transaction contemplated hereby with the advice of
its own counsel and advisors. Each Buyer shall be entitled to independently protect and enforce its rights, including, without
limitation, the rights arising out of this Agreement or out of any other Transaction Documents, and it shall not be necessary
for any other Buyer to be joined as an additional party in any proceeding for such purpose. The use of a single agreement to effectuate
the purchase and sale of the Securities contemplated hereby was solely in the control of the Company, not the action or decision
of any Buyer, and was done solely for the convenience of the Company and its Subsidiaries and not because it was required or requested
to do so by any Buyer. It is expressly understood and agreed that each provision contained in this Agreement and in each other
Transaction Document is between the Company, each Subsidiary and a Buyer, solely, and not between the Company, its Subsidiaries
and the Buyers collectively and not between and among the Buyers.


 


[signature
pages follow]


 




    	 	51	 



     


    

 


IN
WITNESS WHEREOF, each Buyer and the Company have caused their respective signature page to this Agreement to be duly executed
as of the date first written above.


 


	 	COMPANY:
	 	 
	 	SIGMA
    LABS, INC.
	 	 	 
	 	By:	
	 	Name:	
	 	Title:	 


 




    	 	 	 



     


    

 


IN
WITNESS WHEREOF, each Buyer and the Company have caused their respective signature page to this Agreement to be duly executed
as of the date first written above.


 


	 	BUYER:
	 	 
	 	
	 	 	 
	 	By:	
	 	Name:	
	 	Title: