Exhibit 10.1


 


PURCHASE AGREEMENT


 


THIS PURCHASE AGREEMENT
(the “Agreement”), dated as of August 7, 2019, by and between PHIO PHARMACEUTICALS CORP., a Delaware
corporation (the “Company”), and LINCOLN PARK CAPITAL FUND, LLC, an Illinois limited liability
company (the “Investor”).


 


WHEREAS:


 


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


 


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


 


		1.	CERTAIN DEFINITIONS.



 


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


 


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


 


(b)                
“Accelerated Purchase Minimum Price Threshold” means, with respect to any Accelerated Purchase
made pursuant to Section 2(b) hereof, any minimum per share price threshold set forth in the applicable Accelerated Purchase
Notice.


 


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


 


(d)                
“Accelerated Purchase Price” means, with respect to any particular Accelerated Purchase made pursuant
to Section 2(b) hereof, the lower of (i) ninety-five percent (95%) of the VWAP for the period beginning at 9:30:01
a.m., Eastern time, on the applicable Accelerated Purchase Date, or such other time publicly announced by Principal Market as the
official open (or commencement) of trading on the Principal Market on such applicable Accelerated Purchase Date (the “Accelerated
Purchase Commencement Time”), and ending at the earliest of (A) 4:00:00 p.m., Eastern time, on such applicable Accelerated
Purchase Date, or such other time publicly announced by Principal Market as the official close of trading on the Principal Market
on such applicable Accelerated Purchase Date, (B) such time, from and after the Accelerated Purchase Commencement Time for such
Accelerated Purchase, that the total number (or volume) of shares of Common Stock traded on the Principal Market has exceeded the
applicable Accelerated Purchase Share Volume Maximum, and (C) such time, from and after the Accelerated Purchase Commencement Time
for such Accelerated Purchase, that the Sale Price has fallen below the applicable Accelerated Purchase Minimum Price Threshold
(such earliest of (i)(A), (i)(B) and (i)(C) above, the “Accelerated Purchase Termination Time”), and (ii) the
Closing Sale Price of the Common Stock on such applicable Accelerated Purchase Date.


 


(e)                
“Accelerated Purchase Share Amount” means, with respect to an Accelerated Purchase made pursuant
to Section 2(b) hereof, the number of Purchase Shares directed by the Company to be purchased by the Investor in an Accelerated
Purchase Notice, which number of Purchase Shares shall not exceed the lesser of (i) 300% of the number of Purchase Shares directed
by the Company to be purchased by the Investor pursuant to the corresponding Regular Purchase Notice for the corresponding Regular
Purchase referred to in clause (i) of the second sentence of Section 2(b) hereof (subject to the Purchase Share limitations
contained in Section 2(a) hereof) and (ii) an amount equal to (A) the Accelerated Purchase Share Percentage multiplied by
(B) the total number (or volume) of shares of Common Stock traded on the Principal Market during the period on the applicable Accelerated
Purchase Date beginning at the Accelerated Purchase Commencement Time for such Accelerated Purchase and ending at the Accelerated
Purchase Termination Time for such Accelerated Purchase.


 


 


 


 


 






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


 


(g)                
“Accelerated Purchase Share Volume Maximum” means, with respect to an Accelerated Purchase made
pursuant to Section 2(b) hereof, a number of shares of Common Stock equal to (i) the applicable Accelerated Purchase Share
Amount to be purchased by the Investor pursuant to the applicable Accelerated Purchase Notice for such Accelerated Purchase, divided
by (ii) the Accelerated Purchase Share Percentage.


 


(h)                
 “Additional Accelerated Purchase Date” means, with respect to an Additional Accelerated Purchase
made pursuant to Section 2(c) hereof, the Business Day (i) that is the Accelerated Purchase Date with respect to the corresponding
Accelerated Purchase referred to in Section 2(b) hereof and (ii) on which the Investor receives, prior to 1:00 p.m., Eastern
time, on such Business Day, a valid Additional Accelerated Purchase Notice for such Additional Accelerated Purchase in accordance
with this Agreement.


 


(i)                  
 “Additional Accelerated Purchase Minimum Price Threshold” means, with respect to an Additional
Accelerated Purchase made pursuant to Section 2(c) hereof, any minimum per share price threshold set forth in the applicable
Additional Accelerated Purchase Notice.


 


(j)                 
“Additional Accelerated Purchase Notice” means, with respect to an Additional Accelerated Purchase
made pursuant to Section 2(c) hereof, an irrevocable written notice from the Company to the Investor directing the Investor
to purchase the applicable Additional Accelerated Purchase Share Amount at the Additional Accelerated Purchase Price for such Additional
Accelerated Purchase in accordance with this Agreement.


 


(k)                
“Additional Accelerated Purchase Price” means, with respect to an Additional Accelerated Purchase
made pursuant to Section 2(c) hereof, the lower of (i) ninety-five percent (95%) of the VWAP for the period on the applicable
Additional Accelerated Purchase Date, beginning at the latest of (A) the applicable Accelerated Purchase Termination Time with
respect to the corresponding Accelerated Purchase referred to in Section 2(b) hereof on such Additional Accelerated Purchase
Date, (B) the applicable Additional Accelerated Purchase Termination Time with respect to the most recently completed prior Additional
Accelerated Purchase on such Additional Accelerated Purchase Date, as applicable, and (C) the time at which all Purchase Shares
subject to all prior Accelerated Purchases and Additional Accelerated Purchases (as applicable), including, without limitation,
those that have been effected on the same Business Day as the applicable Additional Accelerated Purchase Date with respect to which
the applicable Additional Accelerated Purchase relates, have theretofore been received by the Investor as DWAC Shares in accordance
with this Agreement (such latest of (i)(A), (i)(B) and (i)(C) above, the “Additional Accelerated Purchase Commencement
Time”), and ending at the earliest of (X) 4:00 p.m., Eastern time, on such Additional Accelerated Purchase Date, or such
other time publicly announced by Principal Market as the official close of trading on the Principal Market on such Additional Accelerated
Purchase Date, (Y) such time, from and after the Additional Accelerated Purchase Commencement Time for such Additional Accelerated
Purchase, that total number (or volume) of shares of Common Stock traded on the Principal Market has exceeded the applicable Additional
Accelerated Purchase Share Volume Maximum, and (Z) such time, from and after the Additional Accelerated Purchase Commencement Time
for such Additional Accelerated Purchase, that the Sale Price has fallen below the applicable Additional Accelerated Purchase Minimum
Price Threshold (if any) (such earliest of (i)(X), (i)(Y) and (i)(Z) above, the “Additional Accelerated Purchase Termination
Time”), and (ii) the Closing Sale Price of the Common Stock on such Additional Accelerated Purchase Date.


 


(l)                  
“Additional Accelerated Purchase Share Amount” means, with respect to an Additional Accelerated
Purchase made pursuant to Section 2(c) hereof, the number of Purchase Shares directed by the Company to be purchased by
the Investor on an Additional Accelerated Purchase Notice, which number of Purchase Shares shall not exceed the lesser of (i) 300%
of the number of Purchase Shares directed by the Company to be purchased by the Investor pursuant to the corresponding Regular
Purchase Notice for the corresponding Regular Purchase referred to clause (i) of the second sentence of Section 2(c) hereof
(subject to the Purchase Share limitations contained in Section 2(a) hereof) and (ii) an amount equal to (A) the Additional
Accelerated Purchase Share Percentage multiplied by (B) the total number (or volume) of shares of Common Stock traded on the Principal
Market during the period on the applicable Additional Accelerated Purchase Date beginning at the Additional Accelerated Purchase
Commencement Time for such Additional Accelerated Purchase and ending at the Additional Accelerated Purchase Termination Time for
such Additional Accelerated Purchase.


 


 


 


 






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


 


(n)                
“Additional Accelerated Purchase Share Volume Maximum” means, with respect to an Additional Accelerated
Purchase made pursuant to Section 2(c) hereof, a number of shares of Common Stock equal to (i) the applicable Additional
Accelerated Purchase Share Amount to be purchased by the Investor pursuant to the applicable Additional Accelerated Purchase Notice
for such Additional Accelerated Purchase, divided by (ii) the Additional Accelerated Purchase Share Percentage.


 


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


 


(p)                
“Average Price” means a price per Purchase Share (rounded to the nearest tenth of a cent) equal
to the quotient obtained by dividing (i) the aggregate gross purchase price paid by the Investor for all Purchase Shares purchased
pursuant to this Agreement, by (ii) the aggregate number of Purchase Shares issued pursuant to this Agreement.


 


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


 


(a)                
“Base Price” means a price per Purchase Share equal to the sum of (i) the Signing Market Price and (ii)
$0.0417 (subject to adjustment for any reorganization, recapitalization, non-cash dividend, stock split, reverse stock split or
other similar transaction that occurs on or after the date of this Agreement).


 


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


 


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


 


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


 


 


 


 






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


 


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


 


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


 


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


 


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


 


(z)                
“Maturity Date” means the first day of the month immediately following the thirty (30) month anniversary
of the Commencement Date.


 


(aa)              
“PEA Period” means the period commencing at 9:30 a.m., Eastern time, on the fifth (5th)
Business Day immediately prior to the filing of any post-effective amendment to the Registration Statement (as defined herein)
or New Registration Statement (as such term is defined in the Registration Rights Agreement), and ending at 9:30 a.m., Eastern
time, on the Business Day immediately following, the effective date of any post-effective amendment to the Registration Statement
(as defined herein) or New Registration Statement (as such term is defined in the Registration Rights Agreement).


 


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


 


(cc)              
“Principal Market” means The Nasdaq Capital Market (or any nationally recognized successor thereto);
provided, however, that in the event the Company’s Common Stock is ever listed or traded on The Nasdaq Global Market, The
Nasdaq Global Select Market, the New York Stock Exchange, the NYSE American, the NYSE Arca, the OTC Bulletin Board, the OTCQX operated
by the OTC Markets Group, Inc. or the OTCQB operated by the OTC Markets Group, Inc. (or any nationally recognized successor to
any of the foregoing), then the “Principal Market” shall mean such other market or exchange on which the Company’s
Common Stock is then listed or traded.


 


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


 


 


 


 






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(ee)             
“Purchase Date” means, with respect to any Regular Purchase made pursuant to Section 2(a)
hereof, the Business Day on which the Investor receives by 6:00 p.m., Eastern time, of such Business Day a valid Regular Purchase
Notice that the Investor is to buy Purchase Shares pursuant to Section 2(a) hereof.


 


(ff)              
“Purchase Price” means, with respect to any Regular Purchase made pursuant to Section 2(a)
hereof, the lower of: (i) the lowest Sale Price on the applicable Purchase Date and (ii) the arithmetic average of the three
(3) lowest Closing Sale Prices for the Common Stock during the ten (10) consecutive Business Days ending on the Business Day immediately
preceding such Purchase Date (in each case, to be appropriately adjusted for any reorganization, recapitalization, non-cash dividend,
stock split or other similar transaction that occurs on or after the date of this Agreement).


 


(gg)             
“Registration Rights Agreement” means that certain Registration Rights Agreement, of even date
herewith between the Company and the Investor.


 


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


 


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


 


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


 


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


 


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


 


(mm)           
“Signing Market Price” means $0.3767, representing the consolidated closing bid price of the Common
Stock on The Nasdaq Capital Market on the date of this Agreement, which is calculated as the lower of (i) the most recent closing
price of the Common Stock on the Nasdaq Capital Market immediately preceding the execution of this Agreement or (ii) the average
of the closing price of the Common Stock on the Nasdaq Capital Market for the five Business Days immediately preceding the signing
of this Agreement.


 


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


 


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


 


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


 


(qq)            
“VWAP” means the volume weighted average price of the Common Stock on the Principal Market, as
reported on the Principal Market or by another reputable source such as Bloomberg, L.P.


 


		2.	PURCHASE OF COMMON STOCK.



 


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


 


 


 


 






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(a)                
Commencement of Regular Sales of Common Stock. Upon the satisfaction of the conditions set forth in Sections
7 and 8 hereof (the “Commencement” and the date of satisfaction of such conditions the “Commencement
Date”) and thereafter, the Company shall have the right, but not the obligation, to direct the Investor, by its delivery
to the Investor of a Regular Purchase Notice from time to time, to purchase up to the greater of (i) Two Hundred Thousand (200,000)
Purchase Shares, subject to adjustment as set forth below in this Section 2(a) (such maximum number of Purchase Shares,
as may be adjusted from time to time, (the “Regular Purchase Share Limit”)), or (ii) Fifty Thousand Dollars
($50,000) at the Purchase Price on the Purchase Date (each such purchase, a “Regular Purchase”); provided,
however, that (i) the Regular Purchase Share Limit may be increased at the election of the Company to up to Three Hundred
Thousand (300,000) Purchase Shares, provided that the Closing Sale Price of the Common Stock is not below $0.60 on the Purchase
Date, (ii) the Regular Purchase may be increased at the election of the Company to up to Four Hundred Thousand (400,000) Purchase
Shares, provided that the Closing Sale Price of the Common Stock is not below $0.80 on the Purchase Date, and (iii) the Regular
Purchase may be increased at the election of the Company to up to Five Hundred Thousand (500,000) Purchase Shares, provided that
the Closing Sale Price of the Common Stock is not below $1.00 on the Purchase Date; provided, further, however,
that the Investor’s committed obligation under any single Regular Purchase shall not exceed One Million Dollars ($1,000,000).
If the Company delivers any Regular Purchase Notice for a Purchase Amount in excess of the limitations contained in the immediately
preceding sentence, such Regular Purchase Notice shall be void ab initio to the extent of the amount by which the amount
of Purchase Shares set forth in such Regular Purchase Notice exceeds the amount of Purchase Shares which the Company is permitted
to include in such Regular Purchase Notice in accordance herewith, and the Investor shall have no obligation to purchase such excess
Purchase Shares in respect of such Regular Purchase Notice; provided that the Investor shall remain obligated to purchase the amount
of Purchase Shares which the Company is permitted to include in such Regular Purchase Notice. The Company may deliver multiple
Regular Purchase Notices to the Investor as often as every Business Day, so long as the Company has not failed to deliver Purchase
Shares for all prior Regular Purchases, Accelerated Purchases and Additional Accelerated Purchases, including, without limitation,
those that have been effected on the same Business Day as the applicable Purchase Date, have theretofore been received by the Investor
as DWAC Shares in accordance with this Agreement. Notwithstanding the foregoing, the Company shall not deliver any Regular Purchase
Notices during the PEA Period.


 


(b)                
Accelerated Purchases. Subject to the terms and conditions of this Agreement, beginning one (1) Business Day
following the Commencement Date and thereafter, in addition to purchases of Purchase Shares as described in Section 2(a)
above, the Company shall also have the right, but not the obligation, to direct the Investor by the Company’s delivery to
the Investor of an Accelerated Purchase Notice from time to time, and the Investor thereupon shall have the obligation, to buy
Purchase Shares at the Accelerated Purchase Price on the Accelerated Purchase Date in an amount not exceeding the Accelerated Purchase
Share Amount in accordance with this Agreement (each such purchase, an “Accelerated Purchase”). The Company
may deliver an Accelerated Purchase Notice to the Investor only on a Purchase Date on which (i) the Company also properly submitted
a Regular Purchase Notice providing for a Regular Purchase of a number of Purchase Shares not less than the Regular Purchase Share
Limit then in effect on such Purchase Date in accordance with this Agreement (including, without limitation, giving effect to any
increase to the Regular Purchase Share Limit as a result of the Closing Sale Price of the Common Stock exceeding certain thresholds
set forth in Section 2(a) above on such Purchase Date and any other adjustments to the Regular Purchase Share Limit, in
each case pursuant to Section 2(a) above) and (ii) if all Purchase Shares subject to all prior Regular Purchases, Accelerated
Purchases and Additional Accelerated Purchases, including, without limitation, those that have been effected on the same Business
Day as the applicable Accelerated Purchase Date with respect to which the applicable Accelerated Purchase relates, have theretofore
been received by the Investor as DWAC Shares in accordance with this Agreement. If the Company delivers any Accelerated Purchase
Notice directing the Investor to purchase an amount of Purchase Shares that exceeds the Accelerated Purchase Share Amount that
the Company is then permitted to include in such Accelerated Purchase Notice, such Accelerated Purchase Notice shall be void ab
initio to the extent (and only to the extent) of the amount by which the number of Purchase Shares set forth in such Accelerated
Purchase Notice exceeds the Accelerated Purchase Share Amount which the Company is permitted to include in such Accelerated Purchase
Notice in accordance herewith (which shall be confirmed in an Accelerated Purchase Confirmation (defined below)), and the Investor
shall have no obligation to purchase such excess Purchase Shares in respect of such Accelerated Purchase Notice; provided that
the Investor shall remain obligated to purchase the Accelerated Purchase Share Amount which the Company is permitted to include
in such Accelerated Purchase Notice. Within one (1) Business Day after completion of each Accelerated Purchase Date, the Accelerated
Purchase Share Amount and the applicable Accelerated Purchase Price shall be set forth on a confirmation of the Accelerated Purchase
to be provided to the Company by the Investor (an “Accelerated Purchase Confirmation”). Notwithstanding the
foregoing, the Company shall not deliver any Accelerated Purchase Notices during the PEA Period.


 


 


 


 






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(c)                
Additional Accelerated Purchases. Subject to the terms and conditions of this Agreement, beginning one (1)
Business Day following the Commencement Date and thereafter, in addition to purchases of Purchase Shares as described in Section
2(a) and Section 2(b) above, the Company shall also have the right, but not the obligation, to direct the Investor,
by its timely delivery to the Investor of an Additional Accelerated Purchase Notice on an Additional Accelerated Purchase Date
in accordance with this Agreement, to purchase the applicable Additional Accelerated Purchase Share Amount at the applicable Additional
Accelerated Purchase Price therefor in accordance with this Agreement (each such purchase, an “Additional Accelerated
Purchase”). The Company may deliver multiple Additional Accelerated Purchase Notices to the Investor on an Additional
Accelerated Purchase Date; provided, however, that the Company may deliver an Additional Accelerated Purchase Notice to the Investor
only (i) on a Business Day that is also the Accelerated Purchase Date for an Accelerated Purchase with respect to which the Company
properly submitted to the Investor an Accelerated Purchase Notice in accordance with this Agreement on the applicable Purchase
Date for a Regular Purchase of a number of Purchase Shares not less than the Regular Purchase Share Limit then in effect in accordance
with this Agreement (including, without limitation, giving effect to any increase to the Regular Purchase Share Limit as a result
of the Closing Sale Price of the Common Stock exceeding certain thresholds set forth in Section 2(a) above on such Purchase
Date and any other adjustments to the Regular Purchase Share Limit, in each case pursuant to Section 2(a) above), and (ii)
if all Purchase Shares subject to all prior Regular Purchases, Accelerated Purchases and Additional Accelerated Purchases, including,
without limitation, those that have been effected on the same Business Day as the applicable Additional Accelerated Purchase Date
with respect to which the applicable Additional Accelerated Purchase relates, have theretofore been received by the Investor as
DWAC Shares in accordance with this Agreement. If the Company delivers any Additional Accelerated Purchase Notice directing the
Investor to purchase an amount of Purchase Shares that exceeds the Additional Accelerated Purchase Share Amount that the Company
is then permitted to include in such Additional Accelerated Purchase Notice in accordance with the terms of this Agreement, such
Additional Accelerated Purchase Notice shall be void ab initio to the extent (and only to the extent) of the amount by which the
number of Purchase Shares set forth in such Additional Accelerated Purchase Notice exceeds the Additional Accelerated Purchase
Share Amount that the Company is then permitted to include in such Additional Accelerated Purchase Notice in accordance with the
terms of this Agreement (which shall be confirmed in an Additional Accelerated Purchase Confirmation (defined below)), and the
Investor shall have no obligation to purchase such excess Purchase Shares in respect of such Additional Accelerated Purchase Notice;
provided, however, that the Investor shall remain obligated to purchase the Additional Accelerated Purchase Share Amount which
the Company is permitted to include in such Additional Accelerated Purchase Notice. Within one (1) Business Day after completion
of each Additional Accelerated Purchase Date, the Investor will provide to the Company a written confirmation of each Additional
Accelerated Purchase on such Additional Accelerated Purchase Date setting forth the applicable Additional Accelerated Purchase
Share Amount and Additional Accelerated Purchase Price for each such Additional Accelerated Purchase on such Additional Accelerated
Purchase Date (each, an “Additional Accelerated Purchase Confirmation”). Notwithstanding the foregoing, the
Company shall not deliver any Additional Accelerated Purchase Notices during the PEA Period.


 


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


 


 


 


 






    	 	7	 



     

    

 


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


 


(f)                 
Compliance with Principal Market Rules.


 


(i)                  
Exchange Cap. Subject to Section 2(f)(ii) below, the Company shall not issue or sell any shares of
Common Stock pursuant to this Agreement, and the Investor shall not purchase or acquire any shares of Common Stock pursuant to
this Agreement, to the extent that after giving effect thereto, the aggregate number of shares of Common Stock that would be issued
pursuant to this Agreement and the transactions contemplated hereby would be equal or greater to 5,015,730 shares of Common Stock
(to be appropriately adjusted for any reorganization, recapitalization, non-cash dividend, stock split, reverse stock split or
other similar transaction), representing 19.99% of the shares of Common Stock outstanding on the date of this Agreement (which
number of shares shall be reduced, on a share-for-share basis, by the number of shares of Common Stock issued or issuable pursuant
to any transaction or series of transactions that may be aggregated with the transactions contemplated by this Agreement under
applicable rules of the Nasdaq Capital Market or any other Principal Market on which the Common Stock may be listed or quoted)
(the “Exchange Cap”), unless and until the Company elects to solicit stockholder approval of the issuance of
Common Stock as contemplated by this Agreement and the stockholders of the Company have in fact approved such issuance in accordance
with the applicable rules and regulations of the Nasdaq Capital Market, any other Principal Market on which the Common Stock may
be listed or quoted, and the Company’s Certificate of Incorporation, as amended (the “Certificate of Incorporation”),
and the Company’s Bylaws, as amended (the “Bylaws”). For the avoidance of doubt, the Company may, but
shall be under no obligation to, request its stockholders to approve the issuance of Common Stock as contemplated by this Agreement;
provided, that if stockholder approval is not obtained in accordance with this Section 2(f)(i), the Exchange Cap shall be
applicable for all purposes of this Agreement and the transactions contemplated hereby at all times during the term of this Agreement
(except as set forth in Section 2(f)(ii) below).


 


(ii)                
At-Market Transaction. Notwithstanding Section 2(f)(i) above and subject to the prior approval of the
Nasdaq Capital Market or any other Principal Market on which the Common Stock may be listed or quoted (to the extent required),
the Exchange Cap shall not be applicable for any purposes of this Agreement and the transactions contemplated hereby, solely to
the extent that (and only for so long as) the Average Price shall equal or exceed the Base Price and in accordance with any other
applicable rules of the Nasdaq Capital Market or any other Principal Market on which the Common Stock may be listed or quoted (it
being hereby acknowledged and agreed that the Exchange Cap shall be applicable for all purposes of this Agreement and the transactions
contemplated hereby at all other times during the term of this Agreement, unless the stockholder approval referred to in Section
2(f)(i) is obtained).


 


 


 


 






    	 	8	 



     

    

 


(iii)               
General. The Company shall not issue any Securities pursuant to this Agreement if such issuance would reasonably
be expected to result in (A) a violation of the Securities Act or (B) a breach of the rules and regulations of the Principal Market.
Furthermore, the Company agrees that it shall not issue any Securities pursuant to this Agreement if, at the time of such issuance
(Y) the effectiveness of the Registration Statement registering the Securities has lapsed for any reason (including, without limitation,
the issuance of a stop order or similar order) or (Z) the Registration Statement is unavailable for the sale by the Company to
the Investor (or the resale by the Investor, as the case may be) of any or all of the Securities to be issued to the Investor under
the Transaction Documents. The provisions of this Section 2(f) shall be implemented in a manner otherwise than in strict
conformity with the terms hereof only if necessary to ensure compliance with the Securities Act and the rules and regulations of
the Principal Market.


 


		3.	INVESTOR’S REPRESENTATIONS AND WARRANTIES.



 


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


 


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


 


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


 


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


 


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


 


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


 


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


 


 


 


 


 






    	 	9	 



     

    

 


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


 


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


 


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


 


		4.	REPRESENTATIONS AND WARRANTIES OF THE COMPANY.



 


The Company represents
and warrants to the Investor, except as set forth in the disclosure schedules attached hereto, which exceptions shall be deemed
to be a part of the representations and warranties made hereunder, that as of the date hereof and as of the Commencement Date:


 


(a)                
Organization and Qualification. The Company and each of its Subsidiaries is an entity duly incorporated or
otherwise organized, validly existing and in good standing under the laws of the jurisdiction of its incorporation or organization,
with the requisite corporate power and authority to own and use its properties and assets and to carry on its business as currently
conducted. Neither the Company nor any of its Subsidiaries is in violation or default of any of the provisions of its respective
certificate or Certificate of Incorporation, bylaws or other organizational or charter documents. Each of the Company and its Subsidiaries
is duly qualified to conduct business and is in good standing as a foreign corporation or other entity in each jurisdiction in
which the nature of the business conducted or property owned by it makes such qualification necessary, except where the failure
to be so qualified or in good standing, as the case may be, could not have or reasonably be expected to result in a Material Adverse
Effect and no proceeding has been instituted in any such jurisdiction revoking, limiting or curtailing or seeking to revoke, limit
or curtail such power and authority or qualification. The Company has no Subsidiaries except as set forth on Exhibit 21.1 to the
Company’s Annual Report on Form 10-K for the year ended December 31, 2018.


 


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


 


 


 


 






    	 	10	 



     

    

 


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


 


(d)                
Issuance of Securities. Upon issuance and payment therefor in accordance with the terms and conditions of
this Agreement, the Purchase Shares shall be validly issued, fully paid and nonassessable and free from all taxes, liens, charges,
restrictions, rights of first refusal and preemptive rights with respect to the issue thereof, with the holders being entitled
to all rights accorded to a holder of Common Stock. 26,546,323 shares of Common Stock have been duly authorized and reserved for
issuance upon purchase under this Agreement as Purchase Shares. 500,000 shares of Common Stock (subject to equitable adjustment
for any reorganization, recapitalization, non-cash dividend, stock split or other similar transaction) have been duly authorized
and reserved for issuance as Commitment Shares (as defined below in Section 5(e)) in accordance with this Agreement. The
Commitment Shares shall be validly issued, fully paid and nonassessable and free from all taxes, liens, charges, restrictions,
rights of first refusal and preemptive rights with respect to the issue thereof, with the holders being entitled to all rights
accorded to a holder of Common Stock.


 


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


 


 


 


 






    	 	11	 



     

    

 


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


 


(g)                
Absence of Certain Changes. Except as disclosed in the SEC Documents, since December 31, 2018, there has been
no material adverse change in the business, properties, operations, financial condition or results of operations of the Company
or its Subsidiaries. The Company has not taken any steps, and does not currently expect to take any steps, to seek protection pursuant
to any Bankruptcy Law nor does the Company or any of its Subsidiaries have any knowledge or reason to believe that its creditors
intend to initiate involuntary bankruptcy or insolvency proceedings. The Company is financially solvent and is generally able to
pay its debts as they become due.


 


(h)                
Absence of Litigation. There is no action, suit, proceeding, inquiry or investigation before or by any court,
public board, government agency, self-regulatory organization or body pending or, to the knowledge of the Company or any of its
Subsidiaries, threatened against or affecting the Company, the Common Stock or any of the Company’s or its Subsidiaries’
officers or directors in their capacities as such, which could reasonably be expected to have a Material Adverse Effect.


 


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


 


 


 


 






    	 	12	 



     

    

 


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


 


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


 


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


 


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


 


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


 


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


 


 


 


 






    	 	13	 



     

    

 


(p)                
Tax Status. The Company and each of its Subsidiaries has made or filed all federal and state income and all
other material tax returns, reports and declarations required by any jurisdiction to which it is subject (unless and only to the
extent that the Company and each of its Subsidiaries has set aside on its books provisions reasonably adequate for the payment
of all unpaid and unreported taxes) and has paid all taxes and other governmental assessments and charges that are material in
amount, shown or determined to be due on such returns, reports and declarations, except those being contested in good faith and
has set aside on its books provision reasonably adequate for the payment of all taxes for periods subsequent to the periods to
which such returns, reports or declarations apply. There are no unpaid taxes in any material amount claimed to be due by the taxing
authority of any jurisdiction, and the officers of the Company know of no basis for any such claim.


 


(q)                
Transactions With Affiliates. Except as set forth in the SEC Documents, none of the officers or directors
of the Company and, to the knowledge of the Company, none of the employees of the Company is presently a party to any transaction
with the Company or any Subsidiary (other than for services as employees, officers and directors), including any contract, agreement
or other arrangement providing for the furnishing of services to or by, providing for rental of real or personal property to or
from, or otherwise requiring payments to or from any officer, director or such employee or, to the knowledge of the Company, any
entity in which any officer, director, or any such employee has a substantial interest or is an officer, director, trustee or partner,
in each case in excess of lesser of (i) $120,000 or (i) 1% of the average of the Company's total assets at year end for the last
two completed fiscal years, other than for (i) payment of salary or consulting fees for services rendered, (ii) reimbursement for
expenses incurred on behalf of the Company and (iii) other employee benefits, including stock option agreements under any stock
option plan of the Company.


 


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


 


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


 


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


 


 


 


 






    	 	14	 



     

    

 


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


 


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


 


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


 


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


 


(y)                
Listing and Maintenance Requirements. The Common Stock is registered pursuant to Section 12(b) or 12(g) of
the Exchange Act, and the Company has taken no action designed to, or which to its knowledge is likely to have the effect of, terminating
the registration of the Common Stock pursuant to the Exchange Act nor has the Company received any notification that the SEC is
currently contemplating terminating such registration. Except as set forth in the SEC Documents, the Company has not, in the twelve
(12) months preceding the date hereof, received any notice from the Principal Market to the effect that the Company is not in compliance
with the listing or maintenance requirements of the Principal Market. Although, as of the date of this Agreement, the Company is
not in compliance with Nasdaq Listing Rule 5550(a)(2) for continued listing on The Nasdaq Capital Market, the Company is, and has
no reason to believe that it will not in the foreseeable future continue to be, in compliance with all such listing and maintenance
requirements of the Principal Market.


 


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


 


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


 


(bb)            
Shell Company Status. The Company is not currently, and has never been, an issuer identified in Rule 144(i)(1)
under the Securities Act.


 


(cc)             
No Disqualification Events. None of the Company, any of its predecessors, any affiliated issuer, any director,
executive officer, other officer of the Company participating in the offering contemplated hereby, any beneficial owner of 20%
or more of the Company’s outstanding voting equity securities, calculated on the basis of voting power, nor any promoter
(as that term is defined in Rule 405 under the Securities Act) connected with the Company in any capacity at the time of sale (each,
an “Issuer Covered Person”) is subject to any of the “Bad Actor” disqualifications described in
Rule 506(d)(1)(i) to (viii) under the Securities Act (a “Disqualification Event”), except for a Disqualification
Event covered by Rule 506(d)(2) or (d)(3) under the Securities Act. The Company has exercised reasonable care to determine whether
any Issuer Covered Person is subject to a Disqualification Event.


 


 


 


 






    	 	15	 



     

    

 


		5.	COVENANTS.



 


(a)                
Filing of Current Report and Registration Statement. The Company agrees that it shall, within the time required
under the Exchange Act, file with the SEC a report on Form 8-K relating to the transactions contemplated by, and describing the
material terms and conditions of, the Transaction Documents (the “Current Report”). The Company shall also file
with the SEC, by August 30, 2019, a new registration statement (the “Registration Statement”) registering the
resale of up to 8,125,946 Purchase Shares and 500,000 Commitment Shares in accordance with the terms of the Registration Rights
Agreement. The Company shall permit the Investor to review and comment upon the final pre-filing draft version of the Current Report
at least two (2) Business Days prior to its filing with the SEC, and the Company shall, and the Company shall not file the Current
Report or the Registration Statement with the SEC in a form to which the Investor reasonably objects. The Investor shall use its
reasonable best efforts to comment upon the final pre-filing draft version of the Current Report within one (1) Business Day from
the date the Investor receives it from the Company.


 


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


 


(c)                
Listing/DTC. The Company shall promptly secure the listing of all of the Purchase Shares and Commitment Shares
to be issued to the Investor hereunder on the Principal Market (subject to official notice of issuance) and upon each other national
securities exchange or automated quotation system, if any, upon which the Common Stock is then listed, and shall use reasonable
best efforts to maintain, so long as any shares of Common Stock shall be so listed, such listing of all such Securities from time
to time issuable hereunder. The Company shall use reasonable best efforts to maintain the listing of the Common Stock on the Principal
Market and shall comply in all respects with the Company’s reporting, filing and other obligations under the bylaws or rules
and regulations of the Principal Market. Neither the Company nor any of its Subsidiaries shall take any action that would reasonably
be expected to result in the delisting or suspension of the Common Stock on the Principal Market. The Company shall promptly, and
in no event later than the following Business Day, provide to the Investor copies of any notices it receives from any Person regarding
the continued eligibility of the Common Stock for listing on the Principal Market; provided, however, that the Company shall not
provide the Investor copies of any such notice that the Company reasonably believes constitutes material non-public information,
and the Company would not be required to publicly disclose such notice in any report or statement filed with the SEC under the
Exchange Act (including on Form 8-K) or the Securities Act. The Company shall pay all fees and expenses in connection with satisfying
its obligations under this Section 5(c). The Company shall take all action necessary to ensure that its Common Stock
can be transferred electronically as DWAC Shares.


 


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


 


(e)                
Issuance of Commitment Shares. In consideration for the Investor’s execution and delivery of this Agreement,
the Company shall cause the Transfer Agent to issue as promptly as practicable following the date of this Agreement 500,000 shares
of Common Stock (the “Commitment Shares”) directly to the Investor and shall deliver to the Transfer Agent the
Irrevocable Transfer Agent Instructions in the form as set forth in Exhibit D attached hereto. For the avoidance of doubt,
all of the Commitment Shares shall be fully earned as of the date of this Agreement, whether or not the Commencement shall occur
or any Purchase Shares are purchased by the Investor under this Agreement and irrespective of any termination of this Agreement.


 


 


 


 






    	 	16	 



     

    

 


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


 


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


 


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


 


(i)                  
Aggregation.  From and after the date of this Agreement, neither the Company, nor or any of its affiliates
will, and the Company shall use its reasonable best efforts to ensure that no Person acting on their behalf will, directly or indirectly,
make any offers or sales of any security or solicit any offers to buy any security, under circumstances that would cause this offering
of the Securities by the Company to the Investor to be aggregated with other offerings by the Company in a manner that would require
stockholder approval pursuant to the rules of the Principal Market on which any of the securities of the Company are listed or
designated, unless stockholder approval is obtained before the closing of such subsequent transaction in accordance with the rules
of such Principal Market.


 


(j)                 
Use of Proceeds. The Company will use the net proceeds from the offering for any corporate purpose at the
sole discretion of the Company.


 


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


 


 


 


 






    	 	17	 



     

    

 


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


 


(m)              
Limitation on Variable Rate Transactions. From and after the date of this Agreement until the thirty (30)
month anniversary of the date of this Agreement (irrespective of any earlier termination of this Agreement), the Company shall
be prohibited from effecting or entering into an agreement to effect any issuance by the Company or any of its Subsidiaries of
Common Stock or Common Stock Equivalents (or a combination of units thereof) involving a Variable Rate Transaction, other than
in connection with an Exempt Issuance. The Investor shall be entitled to seek injunctive relief against the Company and its Subsidiaries
to preclude any such issuance, which remedy shall be in addition to any right to collect damages, without the necessity of showing
economic loss and without any bond or other security being required. “Common Stock Equivalents” means any securities
of the Company or its Subsidiaries which entitle the holder thereof to acquire at any time Common Stock, including, without limitation,
any debt, preferred stock, rights, options, warrants or other instrument that is at any time convertible into or exercisable or
exchangeable for, or otherwise entitles the holder thereof to receive, Common Stock. “Variable Rate Transaction”
means a transaction in which the Company (i) issues or sells any debt or equity securities that are convertible into, exchangeable
or exercisable for, or include the right to receive additional shares of Common Stock or Common Stock Equivalents either (A) at
a conversion price, exercise price or exchange rate or other price that is based upon and/or varies with the trading prices of
or quotations for the Common Stock at any time after the initial issuance of such debt or equity securities, or (B) with a conversion,
exercise or exchange price that is subject to being reset at some future date after the initial issuance of such debt or equity
security or upon the occurrence of specified or contingent events directly or indirectly related to the business of the Company
or the market for the Common Stock (including any “full ratchet” anti-dilution provisions) or (ii) enters into any
agreement, including, but not limited to, an “equity line of credit”, “at-the-market offering” or other
continuous offering or similar offering of Common Stock or Common Stock Equivalents, whereby the Company may sell Common Stock
or Common Stock Equivalents at a future determined price. For the avoidance of doubt, the offering and sale by the Company of a
warrant with either (i) a customary “cashless exercise” term, or (ii) a customary weighted-average price anti-dilution
adjustment that is triggered by the Company’s subsequent sale of equity securities at a price that is lower than the applicable
conversion price shall not be deemed to be a prohibited Variable Rate Transaction. “Exempt Issuance” means the
issuance of (a) Common Stock or options to employees, officers, directors or vendors of the Company pursuant to any stock or option
plan duly adopted for such purpose, by the Board of Directors or a majority of the members of a committee of directors established
for such purpose, (b) securities upon the exercise or exchange of or conversion of any Securities issued hereunder and/or other
securities exercisable or exchangeable for or convertible into Common Stock issued and outstanding on the date of this Agreement,
provided that such securities have not been amended since the date of this Agreement to increase the number of such securities
or to decrease the exercise price, exchange price or conversion price of such securities, (c) securities in any “at-the-market
offering” with or conducted by a registered broker dealer and (d) securities issued pursuant to acquisitions or strategic
transactions approved by the Board of Directors or a majority of the members of a committee of directors established for such purpose,
which acquisitions or strategic transactions can have a Variable Rate Transaction component, provided that any such issuance shall
only be to a Person (or to the equity holders of a Person) which is, itself or through its subsidiaries, an operating company or
an asset in a business synergistic with the business of the Company and shall provide to the Company additional benefits in addition
to the investment of funds, but shall not include a transaction in which the Company is issuing securities primarily for the purpose
of raising capital or to an entity whose primary business is investing in securities.


 


 


 


 






    	 	18	 



     

    

 


		6.	TRANSFER AGENT INSTRUCTIONS.



 


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


 


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


 


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


 


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



 


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


 


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


 


 


 


 






    	 	19	 



     

    

 


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


 


(c)                
All Securities to be issued by the Company to the Investor under the Transaction Documents shall have been approved
for listing on the Principal Market in accordance with the applicable rules and regulations of the Principal Market, subject only
to official notice of issuance; and


 


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


 


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



 


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


 


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


 


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


 


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


 


(d)                
The Investor shall have received the opinions of the Company’s legal counsel dated as of the Commencement Date
substantially in the form heretofore agreed by the parties;


'


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


 


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


 


(g)                
As of the Commencement Date, the Company shall have reserved out of its authorized and unissued Common Stock, (i)
solely for the purpose of effecting purchases of Purchase Shares hereunder, 26,546,323 shares of Common Stock;


 


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


 


 


 


 






    	 	20	 



     

    

 


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


 


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


 


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


 


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


 


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


 


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


 


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


 


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


 


 


 


 






    	 	21	 



     

    

 


		9.	INDEMNIFICATION.



 


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


 


		10.	EVENTS OF DEFAULT.



 


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


 


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


 


 


 


 






    	 	22	 



     

    

 


(b)                
the suspension of the Common Stock from trading on the Principal Market for a period of one (1) Business Day, provided
that the Company may not direct the Investor to purchase any shares of Common Stock during any such suspension;


 


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


 


(d)                
If at any time after the Commencement Date, the Exchange Cap is reached unless and until stockholder approval is
obtained pursuant to Section 2(f) hereof. The Exchange Cap shall be deemed to be reached at such time if, upon submission
of a Regular Purchase Notice or Accelerated Purchase Notice under this Agreement, the issuance of such shares of Common Stock would
exceed that number of shares of Common Stock which the Company may issue under this Agreement without breaching the Company’s
obligations under the rules or regulations of the Principal Market;


 


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


 


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


 


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


 


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


 


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


 


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


 


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


 


		11.	TERMINATION



 


This Agreement may
be terminated only as follows:


 


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


 


 


 


 






    	 	23	 



     

    

 


(b)                
In the event that the Commencement shall not have occurred on or before October 30, 2019, due to the failure to satisfy
the conditions set forth in Sections 7 and 8 above with respect to the Commencement, either the Company or the Investor
shall have the option to terminate this Agreement at the close of business on such date or thereafter without liability of any
party to any other party (except as set forth below); provided, however, that the right to terminate this Agreement under this
Section 11(b) shall not be available to any party if such party is then in breach of any covenant or agreement contained
in this Agreement or any representation or warranty of such party contained in this Agreement fails to be true and correct such
that the conditions set forth in Section 7(d) or Section 8(e), as applicable, could not then be satisfied.


 


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


 


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


 


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


 


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


 


		12.	MISCELLANEOUS.



 


(a)                
Governing Law; Jurisdiction; Jury Trial. The corporate laws of the State of Delaware shall govern all issues
concerning the relative rights of the Company and its stockholders. All other questions concerning the construction, validity,
enforcement and interpretation of this Agreement and the other Transaction Documents shall be governed by the internal laws of
the State of Illinois, without giving effect to any choice of law or conflict of law provision or rule (whether of the State of
Illinois or any other jurisdictions) that would cause the application of the laws of any jurisdictions other than the State of
Illinois. Each party hereby irrevocably submits to the exclusive jurisdiction of the state and federal courts sitting in the State
of Illinois, County of Cook, for the adjudication of any dispute hereunder or under the other Transaction Documents or in connection
herewith or therewith, or with any transaction contemplated hereby or discussed herein, and hereby irrevocably waives, and agrees
not to assert in any suit, action or proceeding, any claim that it is not personally subject to the jurisdiction of any such court,
that such suit, action or proceeding is brought in an inconvenient forum or that the venue of such suit, action or proceeding is
improper. Each party hereby irrevocably waives personal service of process and consents to process being served in any such suit,
action or proceeding by mailing a copy thereof to such party at the address for such notices to it under this Agreement and agrees
that such service shall constitute good and sufficient service of process and notice thereof. Nothing contained herein shall be
deemed to limit in any way any right to serve process in any manner permitted by law. EACH PARTY HEREBY IRREVOCABLY WAIVES ANY
RIGHT IT MAY HAVE, AND AGREES NOT TO REQUEST, A JURY TRIAL FOR THE ADJUDICATION OF ANY DISPUTE HEREUNDER OR IN CONNECTION
HEREWITH OR ARISING OUT OF THIS AGREEMENT OR ANY TRANSACTION CONTEMPLATED HEREBY.


 


 


 


 






    	 	24	 



     

    

 


(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; provided that a facsimile signature or signature delivered by e-mail in a “.pdf” format data file
shall be considered due execution and shall be binding upon the signatory thereto with the same force and effect as if the signature
were an original signature.


 


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


 


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


 


(e)                
Entire Agreement. The Transaction Documents supersede all other prior oral or written agreements between the
Investor, the Company, their affiliates and Persons acting on their behalf with respect to the subject matter thereof, and this
Agreement, the other Transaction Documents and the instruments referenced herein contain the entire understanding of the parties
with respect to the matters covered herein and therein and, except as specifically set forth herein or therein, neither the Company
nor the Investor makes any representation, warranty, covenant or undertaking with respect to such matters. The Company acknowledges
and agrees that is has not relied on, in any manner whatsoever, any representations or statements, written or oral, other than
as expressly set forth in the Transaction Documents.


 


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


 


If to the Company:


 


Phio Pharmaceuticals Corp.


257 Simarano Drive, Suite 101

Marlborough, MA 01752


Telephone:        508-767-3861


E-mail:               gdispersyn@phiopharma.com


Attention:          Gerrit Dispersyn,
Dr. Med. Sc


 


If to the Investor:


 


Lincoln Park Capital Fund, LLC


440 North Wells, Suite 410


Chicago, IL 60654


Telephone:        312.822.9300


Facsimile:          312.822.9301


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


Attention:          Josh Scheinfeld/Jonathan
Cope


 


 


 


 






    	 	25	 



     

    

 


With a copy to (which shall not
constitute notice or service of process):


 


K&L Gates,
LLP


200 S. Biscayne
Blvd., Ste. 3900


Miami, Florida
33131


Telephone:        305.539.3306


Facsimile:          305.358.7095


E-mail:               clayton.parker@klgates.com


Attention:          Clayton E. Parker,
Esq.


 


If to the Transfer Agent:


 


Computershare


462 South 4th Street, Suite 1600


Louisville, KY 40202


Telephone:        800-962-4284


 


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


 


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


 


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


 


(i)                  
Publicity. The Company shall afford the Investor and its counsel with the opportunity to review and comment
upon, shall consult with the Investor and its counsel on the form and substance of, and shall give due consideration to all such
comments from the Investor or its counsel on, any press release, SEC filing or any other public disclosure by or on behalf of the
Company relating to the Investor, its purchases hereunder or any aspect of the Transaction Documents or the transactions contemplated
thereby, not less than 24 hours prior to the issuance, filing or public disclosure thereof. The Investor must be provided with
a final version of any such press release, SEC filing or other public disclosure at least 24 hours prior to any release, filing
or use by the Company thereof. The Company agrees and acknowledges that its failure to fully comply with this provision constitutes
a Material Adverse Effect.


 


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


 


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


 


 


 


 






    	 	26	 



     

    

 


(l)                  
No Strict Construction. The language used in this Agreement will be deemed to be the language chosen by the
parties to express their mutual intent, and no rules of strict construction will be applied against any party.


 


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


 


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


 


(o)                
Amendment and Waiver; Failure or Indulgence Not Waiver. No provision of this Agreement may be amended or waived
by the parties from and after the date that is one (1) Business Day immediately preceding the filing of the Registration Statement
with the SEC. Subject to the immediately preceding sentence, (i) no provision of this Agreement may be amended other than by a
written instrument signed by both parties hereto and (ii) no provision of this Agreement may be waived other than in a written
instrument signed by the party against whom enforcement of such waiver is sought. No failure or delay in the exercise of any power,
right or privilege hereunder shall operate as a waiver thereof, nor shall any single or partial exercise of any such power, right
or privilege preclude other or further exercise thereof or of any other right, power or privilege.


 


** Signature Page Follows **


 


 


 


 


 


 


 






    	 	27	 



     

    

 


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


 


 


 


THE COMPANY:


 


PHIO PHARMACEUTICALS CORP.



 


 


 


By:       /s/
Gerrit Dispersyn                                     


Name: Gerrit Dispersyn,
Dr. Med. Sc.


Title: President & CEO


 


 


INVESTOR:


 


LINCOLN PARK CAPITAL FUND,
LLC


BY: LINCOLN PARK CAPITAL,
LLC


BY: Rockledge
Capital Corp


 


 


 


By:       /s/  Josh
Scheinfeld                                     


Name: Josh Scheinfeld


Title: President


 


 


 


 




 


 


 


 






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