Exhibit
10.1


 


SECURITIES
PURCHASE AGREEMENT


 


This
Securities Purchase Agreement (this “Agreement”) is dated as of October 23, 2014, between Wally World Media,
Inc., a Nevada corporation (the “Company”), and each purchaser identified on the signature pages hereto (each,
including its successors and permitted assigns, a “Purchaser” and collectively, the “Purchasers”).


 


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


 


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


 


ARTICLE
I.


DEFINITIONS


 


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


 


“Acquiring
Person” shall have the meaning ascribed to such term in Section 4.7.


 


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


 


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


 


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


 


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


 


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


 


“Closing
Date” means the Business Day on which all of the Transaction Documents have been executed and delivered by the applicable
parties thereto, and all conditions precedent to (i) the Purchasers’ obligations to pay the Subscription Amount at such
Closing, and (ii) the Company’s obligations to deliver the Securities to be issued and sold at such Closing, in each case,
have been satisfied or waived, but in no event later than the tenth Business Day following the date hereof.


 


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


 






    	 



    	 



    

 


“Common
Stock” means the common stock of the Company, par value $0.0001 per share, and any other class of securities into which
such securities may hereafter be reclassified or changed.


 


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


 


“Company
Counsel” means Szaferman, Lakind, Blumstein & Blader, P.C., 101 Grovers Mill Road, Suite 200, Lawrenceville, NJ
08648, Attn: Gregg Jaclin, Esq., facsimile: (609) 275-4511.


 


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


 


“Disclosure
Schedules” means the Disclosure Schedules of the Company delivered concurrently herewith.


 


“Effective
Date” means the earliest of the date that (a) a registration statement has been declared effective by the Commission
including therein all of the Underlying Shares for public unrestricted resale, or (b) all of the Underlying Shares have been sold
pursuant to Rule 144 or may be sold pursuant to Rule 144 without the requirement for the Company to be in compliance with the
current public information requirement under Rule 144 and without volume or manner-of-sale restrictions; and Company counsel has
delivered to such holders a standing written unqualified opinion that resales may then be made by such holders of the Underlying
Shares pursuant to such registration statement or exemption which opinion shall be in form and substance reasonably acceptable
to such holders.


 


“Equity
Line of Credit” shall have the meaning ascribed to such term in Section 4.13.““Evaluation Date”
shall have the meaning ascribed to such term in Section 3.1(r).


 


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


 


“Exempt
Issuance” means the issuance of (a) shares of Common Stock and options to officers, directors, employees, or consultants
of the Company, prior to and after the Closing Date up to the amounts and on the terms set forth on Schedule 4.13, (b)
securities upon the exercise or exchange of or conversion of any Securities issued hereunder, including shares paid as interest
on the Notes pursuant to Section 2.a) of the Notes (subject to adjustment for forward and reverse stock splits and the like that
occur after the date hereof) and/or other securities exercisable or exchangeable for or convertible into shares of Common Stock
issued and outstanding on the date of this Agreement, provided that such securities and any term thereof have not been amended
since the date of this Agreement to increase the number of such securities or to decrease the issue price, exercise price, exchange
price or conversion price of such securities and which securities and the principal terms thereof are set forth on Schedule
3.1(g), and described in the SEC Reports filed not later than ten (10) days before the Closing Date, (c) securities issued
pursuant to acquisitions or strategic transactions approved by a majority of the disinterested directors of the Company, provided
that any such issuance shall only be to a Person (or to the equityholders of a Person) which is, itself or through its subsidiaries,
an operating company or an owner of an asset in a business synergistic with the business of the Company and shall be intended
to provide to the Company substantial 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, (d) as set forth on Schedule 3.1(g), and (e) securities issued or issuable pursuant to this
Agreement, the Notes or the Warrants, including, without limitation, Section 4.18, or upon exercise or conversion of any such
securities.


 






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“FCPA”
means the Foreign Corrupt Practices Act of 1977, as amended.


 


“Form
8-K” shall have the meaning ascribed to such term in Section 4.6.


 


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


 


“G&M”
shall mean Grushko & Mittman, P.C., with offices located at 515 Rockaway Avenue, Valley Stream, New York 11581, Fax: 212-697-3575.


 


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


 


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


 


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


 


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


 


“Listing
Default” shall have the meaning ascribed to such term in Section 4.11.


 


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


 


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


 


“Maximum
Rate” shall have the meaning ascribed to such term in Section 5.17.


 


“Money
Laundering Laws” shall have the meaning ascribed to such term in Section 3.1(gg).


 


“Notes”
means the convertible notes due six (6) months after their respective issue dates, in the form of Exhibit A hereto.


 


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


 


“Participation
Maximum” shall have the meaning ascribed to such term in Section 4.18(a).


 


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


 


“Pre-Notice”
shall have the meaning ascribed to such term in Section 4.18.


 






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


 


“Pro-Rata
Portion” shall have the meaning ascribed to such term in Section 4.18.


 


“Protection
Period” shall have the meaning ascribed to such term in Section 4.15.


 


“Public
Information Failure” shall have the meaning ascribed to such term in Section 4.3(b).


 


“Public
Information Failure Payments” shall have the meaning ascribed to such term in Section 4.3(b).


 


“Purchaser
Party” shall have the meaning ascribed to such term in Section 4.10.


 


“Registration
Expenses” shall have the meaning ascribed to such term in Section 4.23.


 


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


 


“Required
Minimum” means, as of any date, the maximum aggregate number of shares of Common Stock then issued or potentially issuable
in the future pursuant to the Transaction Documents, including any Underlying Shares issuable upon exercise in full of all Warrants
or conversion in full of all Notes, ignoring any conversion or exercise limits set forth therein, and assuming that any previously
unconverted Notes will be held until the third anniversary of the Final Closing Date.


 


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


 


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


 


“Securities”
means the Notes, the Warrants, and the Underlying Shares.


 


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


 


“Selling
Expenses” shall have the meaning ascribed to such term in Section 4.23.


 


“Share
Dilution Adjustment” shall have the meaning ascribed to such term in Section 4.15.


 


“Share
Dilutive Issuance” shall have the meaning ascribed to such term in Section 4.15.


 


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


 


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


 






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“Subsequent
Financing” shall have the meaning ascribed to such term in Section 4.18.


 


“Subsequent
Financing Notice” shall have the meaning ascribed to such term in Section 4.18.


 


“Subsidiary”
means with respect to any entity at any date, any direct or indirect corporation, limited or general partnership, limited liability
company, trust, estate, association, joint venture or other business entity of which (A) more than 30% of (i) the outstanding
capital stock having (in the absence of contingencies) ordinary voting power to elect a majority of the board of directors or
other managing body of such entity, (ii) in the case of a partnership or limited liability company, the interest in the capital
or profits of such partnership or limited liability company or (iii) in the case of a trust, estate, association, joint venture
or other entity, the beneficial interest in such trust, estate, association or other entity business is, at the time of determination,
owned or controlled directly or indirectly through one or more intermediaries, by such entity, or (B) is under the actual control
of the Company.


 


“Termination
Date” shall have the meaning ascribed to such term in Section 2.1.


 


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


 


“Trading
Market” means any of the following markets or exchanges on which the Common Stock is listed or quoted for trading on
the date in question: the NYSE MKT, the Nasdaq Capital Market, the Nasdaq Global Market, the Nasdaq Global Select Market, the
New York Stock Exchange, the OTC Bulletin Board, the OTCQB, or the OTCQX (or any successors to any of the foregoing).


 


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


 


“Transfer
Agent” means VStock Transfer LLC, and any successor transfer agent of the Company.


 


“Underlying
Shares” means the shares of Common Stock issued and issuable upon conversion of the Notes and upon exercise of the Warrants
and issued and issuable in lieu of the cash payment of interest on the Notes in accordance with the terms of the Notes and any
other shares of Common Stock issued or issuable to a Purchaser in connection with or pursuant to the Securities or Transaction
Documents.


 


“Variable
Priced Equity Linked Instruments” shall have the meaning ascribed to such term in Section 4.13.


 


“Variable
Rate Transaction” shall have the meaning ascribed to such term in Section 4.13.


 






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“VWAP”
means, for any date, the price determined by the first of the following clauses that applies: (a) if the Common Stock is then
listed or quoted on a Trading Market, the daily volume weighted average price of the Common Stock for such date (or the nearest
preceding date) on the Trading Market on which the Common Stock is then listed or quoted as reported by Bloomberg L.P. (based
on a Trading Day from 9:30 a.m. (New York City time) to 4:02 p.m. (New York City time)), (b) if the OTC Bulletin Board is not
a Trading Market, the volume weighted average price of the Common Stock for such date (or the nearest preceding date) on the OTC
Bulletin Board, (c) if the Common Stock is not then listed or quoted for trading on the OTC Bulletin Board and if prices for the
Common Stock are then reported on the OTCQX, OTCQB or OTC Pink Marketplace maintained by the OTC Markets Group, Inc. (or a similar
organization or agency succeeding to its functions of reporting prices), the volume weighted average price of the Common Stock
on the first such facility (or a similar organization or agency succeeding to its functions of reporting prices), or (d) in all
other cases, the fair market value of a share of Common Stock as determined by an independent appraiser selected in good faith
by the Purchasers of a majority in interest of the Securities then outstanding and reasonably acceptable to the Company, the fees
and expenses of which shall be paid by the Company.


 


“Warrants”
means, collectively, the Common Stock purchase warrants delivered to the Purchasers at the Closing in accordance with Section
2.2(a) hereof, which Warrants shall be exercisable immediately and have a term of exercise equal to 5 years, in the form of Exhibit
B attached hereto.


 


“Warrant
Dilutive Issuance” shall have the meaning ascribed to such term in Section 4.15.


 


“Warrant
Dilution Adjustment” shall have the meaning ascribed to such term in Section 4.15.


 


“Warrant
Shares” means the shares of Common Stock issuable upon exercise of the Warrants.


 


ARTICLE
II.


PURCHASE
AND SALE


 


2.1Closing.
On the Closing Date, upon the terms and subject to the conditions set forth herein, substantially concurrent with the execution
and delivery of this Agreement by the parties hereto, the Company agrees to sell, and the Purchasers, severally and not jointly,
agree to purchase, an aggregate of $250,000 of principal amount of Notes representing such Purchaser’s Subscription Amount
as set forth on the signature page hereto executed by such Purchaser, and Warrants as determined pursuant to Section 2.2(a) (such
purchase and sale being the “Closing”. Each Purchaser shall deliver to the Company such Purchaser’s Subscription
Amount, and the Company shall deliver to each Purchaser its respective Note and Warrants, as determined pursuant to Section 2.2(a),
and the Company and each Purchaser shall deliver the other items set forth in Section 2.2 deliverable at the Closing. Upon satisfaction
of the covenants and conditions set forth in Sections 2.2 and 2.3, the Closing shall occur at the offices of G&M or such other
location as the parties shall mutually agree. Notwithstanding anything herein to the contrary, the Closing Date shall occur on
or before October 15, 2014 (“Termination Date”). If the Closing is not held on or before the Termination Date,
the Company shall cause all subscription documents and funds to be returned, without interest or deduction to each prospective
Purchaser.


 






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2.2Deliveries.


 


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


 


(i)
this Agreement duly executed by the Company;


 


(ii)a
legal opinion of Company Counsel, substantially in the form of Exhibit H attached hereto;


 


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


 


(iv)Class
A Warrant registered in the name of such Purchaser to purchase up to a number of shares of Common Stock equal to 100% of such
Purchaser’s Subscription Amount divided by the Conversion Price, with an exercise price equal to $0.05 per share, subject
to adjustment as provided therein; and


 


(v)Class
B Warrant registered in the name of such Purchaser to purchase up to a number of shares of Common Stock equal to 100% of such
Purchaser’s Subscription Amount divided by the Conversion Price, with an exercise price equal to $0.25 per share, subject
to adjustment as provided therein.


 


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


 


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


 


(ii) such Purchaser’s Subscription
Amount by wire transfer.


 


2.3Closing
Conditions.


 


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


 


(i)the
accuracy in all material respects on the Closing Date of the representations and warranties of the Purchasers contained herein
(unless as of a specific date therein in which case they shall be accurate as of such date);


 


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


 


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


 


(b)The
respective obligations of a Purchaser hereunder to effect the Closing, unless waived by such Purchaser, are subject to the following
conditions being met:


 


(i)the
accuracy in all material respects (determined without regard to any materiality, Material Adverse Effect or other similar qualifiers
therein) on the Closing Date of the representations and warranties of the Company contained herein (unless as of a specific date
therein in which case they shall be accurate as of such date);


 






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


 


(iii)the
Company shall have received executed signature pages to this Agreement with an aggregate Subscription Amount of $250,000 prior
to the Closing;


 


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


 


(v)there
shall have been no Material Adverse Effect with respect to the Company since the date hereof; and


 


(vi)from
the date hereof to the Closing Date, trading in the Common Stock shall not have been suspended by the Commission or the Company’s
principal Trading Market, and, at any time prior to the Closing Date, trading in securities generally as reported by Bloomberg
L.P. shall not have been suspended or limited, or minimum prices shall not have been established on securities whose trades are
reported by such service, or on any Trading Market, nor shall a banking moratorium have been declared either by the United States
or New York State authorities nor shall there have occurred any material outbreak or escalation of hostilities or other national
or international calamity of such magnitude in its effect on, or any material adverse change in, any financial market which, in
each case, in the reasonable judgment of such Purchaser, makes it impracticable or inadvisable to purchase the Securities at the
Closing.


 


ARTICLE
III.


REPRESENTATIONS
AND WARRANTIES


 


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


 


(a)Subsidiaries.
All of the direct and indirect subsidiaries of the Company and the Company’s ownership interests therein are set forth on
Schedule 3.1(a). The Company owns, directly or indirectly, all of the capital stock or other equity interests of each Subsidiary
free and clear of any Liens, and all of the issued and outstanding shares of capital stock of each Subsidiary are validly issued
and are fully paid, non-assessable and free of preemptive and similar rights to subscribe for or purchase securities.


 


(b)Organization
and Qualification. The Company and each of the Subsidiaries is an entity duly incorporated or otherwise organized, validly
existing and in good standing under the laws of the jurisdiction of its incorporation or organization, with the requisite power
and authority to own and use its properties and assets and to carry on its business as currently conducted. Neither the Company
nor any Subsidiary is in violation nor default of any of the provisions of its respective certificate or articles of incorporation,
bylaws or other organizational or charter documents. Each of the Company and the Subsidiaries is duly qualified to conduct business
and is in good standing as a foreign corporation or other entity in each jurisdiction in which the nature of the business conducted
or property owned by it makes such qualification necessary, except where the failure to be so qualified or in good standing, as
the case may be, could not have or reasonably be expected to result in: (i) a material adverse effect on the legality, validity
or enforceability of any Transaction Document, (ii) a material adverse effect on the results of operations, assets, business,
prospects or condition (financial or otherwise) of the Company and the Subsidiaries, taken as a whole, or (iii) a material adverse
effect on the Company’s ability to perform in any material respect on a timely basis its obligations under any Transaction
Document (any of (i), (ii) or (iii), a “Material Adverse Effect”) and, no Proceeding has been instituted in
any such jurisdiction revoking, limiting or curtailing or seeking to revoke, limit or curtail such power and authority or qualification.


 






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


 


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


 


(e)Filings,
Consents and Approvals. The Company is not required to obtain any consent, waiver, authorization or order of, give any notice
to, or make any filing or registration with, any court or other federal, state, local or other governmental authority or other
Person in connection with the execution, delivery and performance by the Company of the Transaction Documents, other than: (i)
the filings required pursuant to Section 4.5 of this Agreement, (ii) the notice and/or application(s) to each applicable Trading
Market for the issuance and sale of the Notes and Warrant Shares and the listing of the Underlying Shares for trading thereon
in the time and manner required thereby, and (iii) the filing of Form D with the Commission and such filings as are required to
be made under applicable state securities laws (collectively, the “Required Approvals”).


 






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


 


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


 


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


 






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


 


(j)Litigation.
Except as set forth on Schedule 3.1(j), there is no action, suit, inquiry, notice of violation, proceeding or investigation
pending or, to the knowledge of the Company, threatened against or affecting the Company, any Subsidiary or any of their respective
properties before or by any court, arbitrator, governmental or administrative agency or regulatory authority (federal, state,
county, local or foreign) (collectively, an “Action”) which (i) adversely affects or challenges the legality,
validity or enforceability of any of the Transaction Documents or the Securities or (ii) could, if there were an unfavorable decision,
have or reasonably be expected to result in a Material Adverse Effect. Except as set forth in Schedule 3.1(j), since September
30, 2013, neither the Company nor any Subsidiary, nor any director or officer thereof, is or has been the subject of any Action
involving a claim of violation of or liability under federal or state securities laws or a claim of breach of fiduciary duty.
There has not been, and to the knowledge of the Company, there is not pending or contemplated, any investigation by the Commission
involving the Company or any current or former director or officer of the Company. The Commission has not issued any stop order
or other order suspending the effectiveness of any registration statement filed by the Company or any Subsidiary under the Exchange
Act or the Securities Act.


 






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


 


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


 


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


 


(n)Title
to Assets. The Company and the Subsidiaries have good and marketable title in fee simple to all real property (if any) 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
the Subsidiaries, in each case free and clear of all Liens, except for (i) Liens as do not materially affect the value of such
property and do not materially interfere with the use made and proposed to be made of such property by the Company and the Subsidiaries
and (ii) Liens for the payment of federal, state or other taxes, for which appropriate reserves have been made in accordance with
GAAP and, the payment of which is neither delinquent nor subject to penalties. Any real property and facilities held under lease
by the Company and the Subsidiaries are held by them under valid, subsisting and enforceable leases with which the Company and
the Subsidiaries are in compliance.


 






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(o)Intellectual
Property.


 


(i)The
term “Intellectual Property Rights” includes:


 


		1.	the
                                         name of the Company and each Subsidiary, all fictional business names, trading names,
                                         registered and unregistered trademarks, service marks, and applications of the Company
                                         and each Subsidiary (collectively, “Marks'');
	 	 	 
		2.	all
                                         patents, patent applications, and inventions and discoveries that may be patentable of
                                         the Company and each Subsidiary (collectively, “Patents'');
	 	 	 
		3.	all
                                         copyrights in both published works and published works of the Company and each Subsidiary
                                         (collectively, “Copyrights”);
	 	 	 
		4.	all
                                         rights in mask works of the Company and each Subsidiary (collectively, “Rights
                                         in Mask Works''); and
	 	 	 
		5.	all
                                         know-how, trade secrets, confidential information, customer lists, software, technical
                                         information, data, process technology, plans, drawings, and blue prints (collectively,
                                         “Trade Secrets''); owned, used, or licensed by the Company and each Subsidiary
                                         as licensee or licensor.



 


(ii)Agreements.
There are no outstanding and, to Company’s knowledge, no threatened disputes or disagreements with respect to any agreements
relating to any Intellectual Property Rights to which the Company is a party or by which the Company is bound.


 


(iii)Know-How
Necessary for the Business. The Intellectual Property Rights are all those necessary for the operation of the Company’s
businesses as it is currently conducted or as represented, in writing, to the Purchaser to be conducted. The Company is the owner
of all right, title, and interest in and to each of the Intellectual Property Rights, free and clear of all liens, security interests,
charges, encumbrances, equities, and other adverse claims, and has the right to use all of the Intellectual Property Rights. To
the Company’s knowledge, no employee of the Company has entered into any contract that restricts or limits in any way the
scope or type of work in which the employee may be engaged or requires the employee to transfer, assign, or disclose information
concerning his work to anyone other than of the Company.


 


(iv)Patents.
The Company is the owner of all right, title and interest in and to each of the Patents, free and clear of all Liens and other
adverse claims. All of the issued Patents are currently in compliance with formal legal requirements (including payment of filing,
examination, and maintenance fees and proofs of working or use), are valid and enforceable, and are not subject to any maintenance
fees or taxes or actions falling due within ninety days after the Closing Date. No Patent has been or is now involved in any interference,
reissue, reexamination, or opposition proceeding. To the Company’s knowledge: (1) there is no potentially interfering patent
or patent application of any third party, and (2) no Patent is infringed or has been challenged or threatened in any way. To the
Company’s knowledge, none of the products manufactured and sold, nor any process or know-how used, by the Company infringes
or is alleged to infringe any patent or other proprietary right of any other Person.


 






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(v)Trademarks.
The Company is the owner of all right, title, and interest in and to each of the Marks, free and clear of all Liens and other
adverse claims. All Marks that have been registered with the United States Patent and Trademark Office are currently in compliance
with all formal legal requirements (including the timely post-registration filing of affidavits of use and incontestability and
renewal applications), are valid and enforceable, and are not subject to any maintenance fees or taxes or actions falling due
within ninety days after the Closing Date. No Mark has been or is now involved in any opposition, invalidation, or cancellation
and, to the Company’s knowledge, no such action is threatened with respect to any of the Marks. To the Company’s knowledge:
(1) there is no potentially interfering trademark or trademark application of any third party, and (2) no Mark is infringed or
has been challenged or threatened in any way. To the Company’s knowledge, none of the Marks used by the Company infringes
or is alleged to infringe any trade name, trademark, or service mark of any third party.


 


(vi)Copyrights.
The Company is the owner of all right, title, and interest in and to each of the Copyrights, free and clear of all Liens and other
adverse claims. All the Copyrights have been registered and are currently in compliance with formal requirements, are valid and
enforceable, and are not subject to any maintenance fees or taxes or actions falling due within ninety days after the date of
the Closing. No Copyright is infringed or, to the Company’s knowledge, has been challenged or threatened in any way. To
the Company’s knowledge, none of the subject matter of any of the Copyrights infringes or is alleged to infringe any copyright
of any third party or is a derivative work based on the work of a third party. All works encompassed by the Copyrights have been
marked with the proper copyright notice.


 


(vii)Trade
Secrets. With respect to each Trade Secret, the documentation relating to such Trade Secret is current, accurate, and sufficient
in detail and content to identify and explain it and to allow its full and proper use without reliance on the knowledge or memory
of any individual. The Company has taken all reasonable precautions to protect the secrecy, confidentiality, and value of its
Trade Secrets. The Company has good title and an absolute (but not necessarily exclusive) right to use the Trade Secrets. The
Trade Secrets are not part of the public knowledge or literature, and, to the Company’s knowledge, have not been used, divulged,
or appropriated either for the benefit of any Person (other the Company) or to the detriment of the Company. No Trade Secret is
subject to any adverse claim or has been challenged or threatened in any way.


 


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


 






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(q)Transactions
With Affiliates and Employees. Except as set forth in the SEC Reports, none of the officers or directors of the Company or
any Subsidiary and, to the knowledge of the Company, none of the employees of the Company or any Subsidiary is presently a party
to any transaction with the Company or any Subsidiary (other than for services as employees, officers and directors), including
any contract, agreement or other arrangement providing for the furnishing of services to or by, providing for rental of real or
personal property to or from, providing for the borrowing of money from or lending of money to or otherwise requiring payments
to or from any officer, director or such employee or, to the knowledge of the Company, any entity in which any officer, director,
or any such employee has a substantial interest or is an officer, director, trustee, stockholder, member or partner, in each case
in excess of $50,000 other than for: (i) payment of salary or consulting fees for services rendered, (ii) reimbursement for expenses
incurred on behalf of the Company and (iii) other employee benefits, including stock option agreements under any stock option
plan of the Company except as disclosed on Schedule 3.1(g).


 


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


 


(s)Certain
Fees. Except as set forth on Schedule 3.1(s), no brokerage, finder’s fees, commissions or due diligence fees
are or will be payable by the Company or any Subsidiary to any broker, financial advisor or consultant, finder, placement agent,
investment banker, bank or other Person with respect to the transactions contemplated by the Transaction Documents. The Purchasers
shall have no obligation with respect to any such fees or with respect to any claims made by or on behalf of other Persons for
fees of a type contemplated in this Section 3.1(s) that may be due in connection with the transactions contemplated by the Transaction
Documents.


 


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


 






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(u)Registration
Rights. No Person has any right to cause the Company or any Subsidiary to effect the registration under the Securities Act
of any securities of the Company or any Subsidiary.


 


(v)Reporting
Company/Shell Company. The Company is a publicly-held company subject to reporting obligations pursuant to Sections 12(g)
and 13 of the Exchange Act. Pursuant to the provisions of the Exchange Act, except as set forth on Schedule 3.1(v), the
Company has timely filed all reports and other materials required to be filed by the Company thereunder with the SEC during the
preceding twelve months. As of the Closing Date, the Company is not a “shell company”, nor a former “shell company”
as those terms are employed in Rule 144 under the Securities Act. 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.


 


(w)Application
of Takeover Protections. The Company and the Board of Directors will have taken as of the Closing 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 Company’s certificate of incorporation (or
similar charter documents) or the laws of its state of incorporation that is or could become applicable to the Purchasers as a
result of the Purchasers and the Company fulfilling their obligations or exercising their rights under the Transaction Documents,
including without limitation as a result of the Company’s issuance of the Securities and the Purchasers’ ownership
of the Securities.


 


(x)Disclosure.
Except with respect to the material terms and conditions of the transactions contemplated by the Transaction Documents, the Company
confirms that neither it nor any other Person acting on its behalf has provided any of the Purchasers or their agents or counsel
with any information that it believes constitutes or might constitute material, non-public information. The Company understands
and confirms that the Purchasers will rely on the foregoing representation in effecting transactions in securities of the Company.
All of the disclosure furnished by or on behalf of the Company to the Purchasers regarding the Company and its Subsidiaries, their
respective businesses and the transactions contemplated hereby, including the Disclosure Schedules to this Agreement, when taken
together as a whole, is true and correct and does not contain any untrue statement of a material fact or omit to state any material
fact necessary in order to make the statements made therein, in light of the circumstances under which they were made, not misleading.
The press releases disseminated by the Company during the twelve 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 no Purchaser makes or has made any representations or warranties with respect to the
transactions contemplated hereby other than those specifically set forth in Section 3.2 hereof.


 


(y)No
Integrated Offering. Assuming the accuracy of the Purchasers’ representations and warranties set forth in Section 3.2,
neither the Company, nor any of its Affiliates, nor any Person acting on its or 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 cause this offering
of the Securities to be integrated with prior offerings by the Company for purposes of: (i) the Securities Act which would require
the registration of any such securities under the Securities Act, or (ii) any applicable shareholder approval provisions of any
Trading Market on which any of the securities of the Company are listed or designated.


  






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(z)Solvency.
Based on the consolidated financial condition of the Company as of the Closing Date, and the Company’s good faith estimate
of the fair market value of its assets, after giving effect to the receipt by the Company of the proceeds from the sale of the
Securities hereunder: (i) the fair saleable value of the Company’s assets exceeds the amount that will be required to be
paid on or in respect of the Company’s existing debts and other liabilities (including known contingent liabilities) as
they mature, (ii) the Company’s assets do not constitute unreasonably small capital to carry on its business as now conducted
and as proposed to be conducted including its capital needs taking into account the particular capital requirements of the business
conducted by the Company, consolidated and projected capital requirements and capital availability thereof, and (iii) the current
cash flow of the Company, together with the proceeds the Company would receive, were it to liquidate all of its assets, after
taking into account all anticipated uses of the cash, would be sufficient to pay all amounts on or in respect of its liabilities
when such amounts are required to be paid. The Company does not intend to incur debts beyond its ability to pay such debts as
they mature (taking into account the timing and amounts of cash to be payable on or in respect of its debt). The Company has no
knowledge of any facts or circumstances which lead it to believe that it will file for reorganization or liquidation under the
bankruptcy or reorganization laws of any jurisdiction within one year from the Closing Date. Schedule 3.1(z) sets forth
as of the date hereof all outstanding secured and unsecured Indebtedness of the Company or any Subsidiary, or for which the Company
or any Subsidiary has commitments. For the purposes of this Agreement, “Indebtedness” means (x) any liabilities
for borrowed money or amounts owed in excess of $100,000 in the aggregate (other than trade accounts payable incurred in the ordinary
course of business), (y) all guaranties, endorsements and other contingent obligations in respect of indebtedness of others, whether
or not the same are or should be reflected in the Company’s consolidated balance sheet (or the notes thereto), except guaranties
by endorsement of negotiable instruments for deposit or collection or similar transactions in the ordinary course of business;
and (z) the present value of any lease payments in excess of $100,000 due under leases required to be capitalized in accordance
with GAAP. Neither the Company nor any Subsidiary is in default with respect to any Indebtedness.


 


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


 


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


 






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(cc)Accountants.
The Company’s accounting firm is set forth on Schedule 3.1(cc) of the Disclosure Schedules. To the knowledge and
belief of the Company, such accounting firm: (i) is a registered public accounting firm as required by the Exchange Act and (ii)
shall express its opinion with respect to the financial statements to be included in the Company’s Annual Report for the
fiscal year ending September 30, 2014.


 


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


 


(ee)Acknowledgment
Regarding Purchaser’s Trading Activity. Anything in this Agreement or elsewhere herein to the contrary notwithstanding
(except for Sections 3.2(e) and 4.16 hereof), it is understood and acknowledged by the Company that: (i) none of the Purchasers
has been asked by the Company to agree, nor has any Purchaser agreed, to desist from purchasing or selling, long and/or short,
securities of the Company, or “derivative” securities based on securities issued by the Company or to hold the Securities
for any specified term, (ii) past or future open market or other transactions by any Purchaser, specifically including, without
limitation, Short Sales or “derivative” transactions, before or after the closing of this or future private placement
transactions, may negatively impact the market price of the Company’s publicly-traded securities, (iii) any Purchaser, and
counter-parties in “derivative” transactions to which any such Purchaser is a party, directly or indirectly, may presently
have a “short” position in the Common Stock and (iv) each Purchaser shall not be deemed to have any affiliation with
or control over any arm’s length counter-party in any “derivative” transaction. The Company further understands
and acknowledges that (y) one or more Purchasers may engage in hedging activities at various times during the period that the
Securities are outstanding, including, without limitation, during the periods that the value of the Underlying Shares deliverable
with respect to Securities are being determined, and (z) such hedging activities (if any) could reduce the value of the existing
stockholders' equity interests in the Company at and after the time that the hedging activities are being conducted. The Company
acknowledges that such aforementioned hedging activities do not constitute a breach of any of the Transaction Documents. There
are no disagreements of any kind presently existing, or reasonably anticipated by the Company to arise, between the Company and
the accountants and lawyers formerly or presently employed by the Company and the Company is current with respect to any fees
owed to its accountants and lawyers which could affect the Company’s ability to perform any of its obligations under any
of the Transaction Documents.


 


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


 






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(gg)Money
Laundering. The operations of the Company and its Subsidiaries are and have been conducted at all times in compliance with
applicable financial record-keeping and reporting requirements of the Currency and Foreign Transactions Reporting Act of 1970,
as amended, applicable money laundering statutes and applicable rules and regulations thereunder (collectively, the “Money
Laundering Laws”), and no action, suit or proceeding by or before any court or governmental agency, authority or body
or any arbitrator involving the Company or any Subsidiary with respect to the Money Laundering Laws is pending or, to the knowledge
of the Company or any Subsidiary, threatened.


 


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



 


(ii)Office
of Foreign Assets Control. Neither the Company nor any Subsidiary nor, to the Company's knowledge, any director, officer,
agent, employee or affiliate of the Company is currently subject to any U.S. sanctions administered by the Office of Foreign Assets
Control of the U.S. Treasury Department (“OFAC”).


 


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


 


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


 


(ll)Indebtedness
and Seniority. As of the date hereof, all Indebtedness and Liens are as set forth on Schedule 3.1(ll). Except as set
forth on Schedule 3.1(ll), as of the Closing Date, no Indebtedness or other equity of the Company is senior to the Notes
in right of payment, whether with respect to interest or upon liquidation or dissolution, or otherwise, other than indebtedness
secured by purchase money security interests (which is senior only as to underlying assets covered thereby) and capital lease
obligations (which is senior only as to the property covered thereby).


 


(mm)Listing
and Maintenance Requirements. The Common Stock is quoted on the OTCQB under the symbol WLYW. The Company has not, in the twenty-four
(24) months preceding the date hereof, received notice from any Trading Market on which the Common Stock is or has been listed
or quoted to the effect that the Company is not in compliance with the listing or maintenance requirements of such Trading Market.


 






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(nn)Survival.
The foregoing representations and warranties shall survive the Closing Date.


 


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


 


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


 


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


 


(c)Purchaser
Status. At the time such Purchaser was offered the Securities, it was, and as of the date hereof it is, and on each date on
which it exercises any Warrants or converts any Notes it will be either: (i) an “accredited investor” as defined in
Rule 501(a)(1), (a)(2), (a)(3), (a)(7) or (a)(8) under the Securities Act or (ii) a “qualified institutional buyer”
as defined in Rule 144A(a) under the Securities Act. Such Purchaser is not required to be registered as a broker-dealer under
Section 15 of the Exchange Act. Such Purchaser has the authority and is duly and legally qualified to purchase and own the Securities.
Such Purchaser is able to bear the risk of such investment for an indefinite period and to afford a complete loss thereof. Such
Purchaser has provided the information in the Accredited Investor Questionnaire attached hereto as Exhibit D (the “Investor
Questionnaire”). The information set forth on the signature pages hereto and the Investor Questionnaire regarding such
Purchaser is true and complete in all respects. Except as disclosed in the Investor Questionnaire, such Purchaser has had no position,
office or other material relationship within the past three years with the Company or Persons (as defined below) known to such
Purchaser to be affiliates of the Company, and is not a member of the Financial Industry Regulatory Authority or an “associated
person” (as such term is defined under the FINRA Membership and Registration Rules Section 1011).


 






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


 


(e)Information
on Company. Such Purchaser has been furnished with or has had access to the EDGAR Website of the Commission to the Company’s
filings made with the Commission during the period from the date that is two years preceding the date hereof through the tenth
business day preceding the Closing Date in which such Purchaser purchases Securities hereunder, including the Company’s
Annual Report on Form 10-K filed with the Commission on December 23, 2013 together with the Closing Form 8-K (hereinafter referred
to collectively as the “Reports”). Purchasers are not deemed to have any knowledge of any information
not included in the Reports unless such information is delivered in the manner described in the next sentence. In addition, such
Purchaser may have received in writing from the Company such other information concerning its operations, financial condition
and other matters as such Purchaser has requested, identified thereon as OTHER WRITTEN INFORMATION (such other information is
collectively, the “Other Written Information”), and considered all factors such Purchaser deems material
in deciding on the advisability of investing in the Securities. Such Purchaser was afforded (i) the opportunity to ask such questions
as such Purchaser deemed necessary of, and to receive answers from, representatives of the Company concerning the merits and risks
of acquiring the Securities; (ii) the right of access to information about the Company and its financial condition, results of
operations, business, properties, management and prospects sufficient to enable such Purchaser to evaluate the Securities; and
(iii) the opportunity to obtain such additional information that the Company possesses or can acquire without unreasonable effort
or expense that is necessary to make an informed investment decision with respect to acquiring the Securities.


 


(f)Compliance
with Securities Act; Reliance on Exemptions. Such Purchaser understands and agrees that the Securities have not been registered
under the 1933 Act or any applicable state securities laws, by reason of their issuance in a transaction that does not require
registration under the 1933 Act, and that such Securities must be held indefinitely unless a subsequent disposition is registered
under the 1933 Act or any applicable state securities laws or is exempt from such registration. Such Purchaser understands and
agrees that the Securities are being offered and sold to such Purchaser in reliance on specific exemptions from the registration
requirements of United States federal and state securities laws and regulations and that the Company is relying in part upon the
truth and accuracy of, and such Purchaser’s compliance with, the representations, warranties, agreements, acknowledgments
and understandings of such Purchaser set forth herein in order to determine the availability of such exemptions and the eligibility
of such Purchaser to acquire the Securities.


 


(g)Communication
of Offer. Such Purchaser is not purchasing the Securities as a result of any “general solicitation” or “general
advertising,” as such terms are defined in Regulation D, which includes, but is not limited to, any advertisement, article,
notice or other communication regarding the Securities published in any newspaper, magazine or similar media or on the internet
or broadcast over television, radio or the internet or presented at any seminar or any other general solicitation or general advertisement.


 






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


 


(i)No
Conflicts. The execution, delivery and performance of this Agreement and performance under the other Transaction Documents
and the consummation by such Purchaser of the transactions contemplated hereby and thereby or relating hereto or thereto do not
and will not (i) result in a violation of such Purchaser’s charter documents, bylaws or other organizational documents,
if applicable, (ii) conflict with nor constitute a default (or an event which with notice or lapse of time or both would become
a default) under any agreement to which such Purchaser is a party, nor (iii) result in a violation of any law, rule, or regulation,
or any order, judgment or decree of any court or governmental agency applicable to such Purchaser or its properties (except for
such conflicts, defaults and violations as would not, individually or in the aggregate, have a material adverse effect on such
Purchaser). Such Purchaser is not required to obtain any consent, authorization or order of, or make any filing or registration
with, any court or governmental agency in order for it to execute, deliver or perform any of its obligations under this Agreement
or perform under the other Transaction Documents nor to purchase the Securities in accordance with the terms hereof, provided
that for purposes of the representation made in this sentence, such Purchaser is assuming and relying upon the accuracy of the
relevant representations and agreements of the Company herein.


 


(j)Survival.
The foregoing representations and warranties shall survive the Closing Date.


 


The
Company acknowledges and agrees that the representations contained in Section 3.2 shall not modify, amend or affect such Purchaser’s
right to rely on the Company’s representations and warranties contained in this Agreement or any representations and warranties
contained in any other Transaction Document or any other document or instrument executed and/or delivered in connection with this
Agreement or the consummation of the transaction contemplated hereby.


 


ARTICLE
IV.


OTHER
AGREEMENTS OF THE PARTIES


 


4.1Transfer
Restrictions.


 


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


 






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


 


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


 


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


 


(c)Certificates
evidencing the Underlying Shares shall not contain any legend (including the legend set forth in Section 4.1(b) hereof): (i) while
a registration statement covering the resale of such security is effective under the Securities Act, (ii) following any sale of
such Underlying Shares pursuant to Rule 144, (iii) if such Underlying Shares are eligible for sale under Rule 144, without the
requirement for the Company to be in compliance with the current public information required under Rule 144 as to such Underlying
Shares and without volume or manner-of-sale restrictions or (iv) if such legend is not required under applicable requirements
of the Securities Act (including judicial interpretations and pronouncements issued by the staff of the Commission). The Company
shall cause its counsel to issue a legal opinion to the Transfer Agent promptly after the Effective Date if required by the Transfer
Agent to effect the removal of the legend hereunder. If all or any Notes are converted or any portion of a Warrant is exercised
at a time when there is an effective registration statement to cover the resale of the Underlying Shares, or if such Underlying
Shares may be sold under Rule 144 or if such legend is not otherwise required under applicable requirements of the Securities
Act (including judicial interpretations and pronouncements issued by the staff of the Commission) then such Underlying Shares
shall be issued free of all legends. The Company agrees that following such time as such legend is no longer required under this
Section 4.1(c), it will, no later than five Trading Days following the delivery by a Purchaser to the Company or the Transfer
Agent of a certificate representing Underlying Shares, as applicable, issued with a restrictive legend (such fifth Trading Day,
the “Legend Removal Date”), deliver or cause to be delivered to such Purchaser a certificate representing such
shares that is free from all restrictive and other legends (however, the Corporation shall use reasonable best efforts to deliver
such shares within three (3) Trading Days). The Company may not make any notation on its records or give instructions to the Transfer
Agent that enlarge the restrictions on transfer set forth in this Section 4. Certificates for Underlying Shares subject to legend
removal hereunder shall be transmitted by the Transfer Agent to the Purchaser by crediting the account of the Purchaser’s
prime broker with the Depository Trust Company System as directed by such Purchaser.


 






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(d)In
addition to such Purchaser’s other available remedies, the Company shall pay to a Purchaser, in cash, as partial liquidated
damages and not as a penalty, for each $1,000 of Underlying Shares (based on the higher of the actual purchase price or VWAP of
the Common Stock on the date such Securities are submitted to the Transfer Agent) delivered for removal of the restrictive legend
and subject to Section 4.1(c), $10 per Trading Day for each Trading Day after the Legend Removal Date (increasing to $20 per Trading
Day after the fifth Trading Day) until such certificate is delivered without a legend. Nothing herein shall limit such Purchaser’s
right to pursue actual damages for the Company’s failure to deliver certificates representing any Securities as required
by the Transaction Documents, and such Purchaser shall have the right to pursue all remedies available to it at law or in equity
including, without limitation, a decree of specific performance and/or injunctive relief.


 


(e)DWAC.
In lieu of delivering physical certificates representing the Unlegended Shares, upon request of a Purchaser, so long as the certificates
therefor do not bear a legend and the Purchaser is not obligated to return such certificate for the placement of a legend thereon,
the Company shall cause its transfer agent to electronically transmit the Unlegended Shares by crediting the account of Purchaser’s
prime broker with the Depository Trust Company through its Deposit Withdrawal At Custodian system, provided that the Company’s
Common Stock is DTC eligible and the Company’s transfer agent participates in the Deposit Withdrawal at Custodian system.
Such delivery must be made on or before the Legend Removal Date.


 


(f)Injunction.
In the event a Purchaser shall request delivery of Unlegended Shares as described in this Section 4.1 and the Company is required
to deliver such Unlegended Shares, the Company may not refuse to deliver Unlegended Shares based on any claim that such Purchaser
or anyone associated or affiliated with such Purchaser has not complied with Purchaser’s obligations under the Transaction
Documents, or for any other reason, unless, an injunction or temporary restraining order from a court, on notice, restraining
and or enjoining delivery of such Unlegended Shares shall have been sought and obtained by the Company and the Company has posted
a surety bond for the benefit of such Purchaser in the amount of the greater of (i) 120% of the amount of the aggregate purchase
price of the Underlying Shares to be subject to the injunction or temporary restraining order, or (ii) the VWAP of the Common
Stock on the trading day before the issue date of the injunction multiplied by the number of Unlegended Shares to be subject to
the injunction, which bond shall remain in effect until the completion of arbitration/litigation of the dispute and the proceeds
of which shall be payable to such Purchaser to the extent Purchaser obtains judgment in Purchaser’s favor.


 






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(g)Buy-In.
In addition to any other rights available to Purchaser, if the Company fails to deliver to a Purchaser Unlegended Shares as required
pursuant to this Agreement and after the Legend Removal Date the Purchaser, or a broker on the Purchaser’s behalf, purchases
(in an open market transaction or otherwise) shares of Common Stock to deliver in satisfaction of a sale by such Purchaser of
the shares of Common Stock which the Purchaser was entitled to receive in unlegended form from the Company (a “Buy-In”),
then the Company shall promptly pay in cash to the Purchaser (in addition to any remedies available to or elected by the Purchaser)
the amount, if any, by which (A) the Purchaser’s total purchase price (including brokerage commissions, if any) for the
shares of Common Stock so purchased exceeds (B) the aggregate purchase price of the shares of Common Stock delivered to the Company
for reissuance as Unlegended Shares together with interest thereon at a rate of 15% per annum accruing until such amount and any
accrued interest thereon is paid in full (which amount shall be paid as liquidated damages and not as a penalty). For example,
if a Purchaser purchases shares of Common Stock having a total purchase price of $11,000 to cover a Buy-In with respect to $10,000
of purchase price of Shares delivered to the Company for reissuance as Unlegended Shares, the Company shall be required to pay
the Purchaser $1,000, plus interest, if any. The Purchaser shall provide the Company written notice indicating the amounts payable
to the Purchaser in respect of the Buy-In.


 


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


 


4.2Acknowledgment
of Dilution. The Company acknowledges that the issuance of the Securities may result in dilution of the outstanding shares
of Common Stock, which dilution may be substantial under certain market conditions. The Company further acknowledges that its
obligations under the Transaction Documents, including, without limitation, its obligation to issue the Underlying Shares pursuant
to the Transaction Documents, are unconditional and absolute and not subject to any right of set off, counterclaim, delay or reduction,
regardless of the effect of any such dilution or any claim the Company may have against any Purchaser and regardless of the dilutive
effect that such issuance may have on the ownership of the other stockholders of the Company.


 


4.3Furnishing
of Information; Public Information.


 


(a)Until
the earliest of the time that (i) no Purchaser owns Securities or (ii) the Warrants have expired, the Company covenants to file
all periodic reports with the Commission pursuant to Section 15(d) of the Exchange Act or alternatively, if registered under Section
12(b) or 12(g) of the 1934 Act, maintain the registration of the Common Stock under Section 12(b) or 12(g) of the Exchange Act
and to timely file (or obtain extensions in respect thereof and file within the applicable grace period) all reports required
to be filed by the Company after the date hereof pursuant to the Exchange Act even if the Company is not then subject to the reporting
requirements of the Exchange Act.


 






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(b)At
any time commencing on the Closing Date and ending at such time that all of the Securities may be sold without the requirement
for the Company to be in compliance with Rule 144(c)(1) and otherwise without restriction or limitation pursuant to Rule 144,
if the Company shall fail for any reason to satisfy the current public information requirement under Rule 144(c) (a “Public
Information Failure”) then, in addition to such Purchaser’s other available remedies, the Company shall pay to a Purchaser,
in cash, as partial liquidated damages and not as a penalty, by reason of any such delay in or reduction of its ability to sell
the Securities, an amount in cash equal to two percent (2.0%) of the aggregate principal amount of Notes and accrued interest
held by such Purchaser on the day of a Public Information Failure and on every thirtieth (30th) day (pro-rated for periods totaling
less than thirty days) thereafter until the earlier of (a) the date such Public Information Failure is cured and (b) such time
that such public information is no longer required for the Purchasers to transfer the Underlying Shares pursuant to Rule 144.
The payments to which a Purchaser shall be entitled pursuant to this Section 4.2(b) are referred to herein as “Public
Information Failure Payments.” Public Information Failure Payments shall be paid on the earlier of (i) the last day
of the calendar month during which such Public Information Failure Payments are incurred and (ii) the third (3rd) Business Day
after the event or failure giving rise to the Public Information Failure Payments is cured. In the event the Company fails to
make Public Information Failure Payments in a timely manner, such Public Information Failure Payments shall bear interest at the
rate of 1.5% per month (prorated for partial months) until paid in full. Nothing herein shall limit such Purchaser’s right
to pursue actual damages for the Public Information Failure, and such Purchaser shall have the right to pursue all remedies available
to it at law or in equity including, without limitation, a decree of specific performance and/or injunctive relief.


 


4.4Integration.
The Company shall not sell, offer for sale or solicit offers to buy or otherwise negotiate in respect of any security (as defined
in Section 2 of the Securities Act) that would be integrated with the offer or sale of the Securities in a manner that would require
the registration under the Securities Act of the sale of the Securities or that would be integrated with the offer or sale of
the Securities for purposes of the rules and regulations of any Trading Market such that it would require shareholder approval
prior to the closing of such other transaction unless shareholder approval is obtained before the closing of such subsequent transaction.


 


4.5Conversion
and Exercise Procedures. Each of the form of Notice of Exercise included in the Warrants and the form of Notice of Conversion
included in the Notes set forth the totality of the procedures required of the Purchasers in order to exercise the Warrants or
convert the Notes. No additional legal opinion, other information or instructions shall be required of the Purchasers to exercise
their Warrants or convert their Notes. The Company shall honor exercises of the Warrants and conversions of the Notes and shall
deliver Underlying Shares in accordance with the terms, conditions and time periods set forth in the Transaction Documents.


 


4.6Securities
Laws Disclosure; Publicity. The Company shall, by 9:30 a.m. (New York City time) on the Trading Day immediately following
the Closing Date, file a Current Report on Form 8-K including the Transaction Documents as exhibits thereto with the Commission
within the time required by the Exchange Act (“Form 8-K”). A form of the Form 8-K is annexed hereto as Exhibit
F. Such Exhibit F will be identical to the Form 8-K which will be filed with the Commission except for the omission
of signatures thereto by the Company and auditors providing the financial statements. From and after the filing of the Form 8-K,
the Company represents to the Purchasers that it shall have publicly disclosed all material, non-public information delivered
to any of the Purchasers by the Company or any of its Subsidiaries, or any of their respective officers, directors, employees
or agents in connection with the transactions contemplated by the Transaction Documents. The Company and each Purchaser shall
consult with each other in issuing any press releases with respect to the transactions contemplated hereby, and neither the Company
nor any Purchaser shall issue any press release nor otherwise make any such public statement without the prior consent of the
Company, with respect to any press release of any Purchaser, or without the prior consent of each Purchaser, with respect to any
press release of the Company, which consent shall not unreasonably be withheld or delayed, except if such disclosure is required
by law, in which case the disclosing party shall promptly provide the other party with prior notice of such public statement or
communication. Notwithstanding the foregoing, the Company shall not publicly disclose the name of any Purchaser, or include the
name of any Purchaser in any filing with the Commission or any regulatory agency or Trading Market unless the name of such Purchaser
is already included in the body of the Transaction Documents, without the prior written consent of such Purchaser, except: (a)
as required by federal securities law in connection with the filing of final Transaction Documents with the Commission and (b)
to the extent such disclosure is required by law or Trading Market regulations, in which case the Company shall provide the Purchasers
with prior notice of such disclosure permitted under this clause (b).


 






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4.7Shareholder
Rights Plan. No claim will be made or enforced by the Company or, with the consent of the Company, any other Person, that
any Purchaser is an “Acquiring Person” under any control share acquisition, business combination, poison pill (including
any distribution under a rights agreement) or similar anti-takeover plan or arrangement in effect or hereafter adopted by the
Company, or that any Purchaser could be deemed to trigger the provisions of any such plan or arrangement, by virtue of receiving
Securities under the Transaction Documents or under any other agreement between the Company and the Purchasers.


 


4.8Non-Public
Information. Except with respect to the material terms and conditions of the transactions contemplated by the Transaction
Documents, the Company covenants and agrees that neither it, nor any other Person acting on its behalf, will provide any Purchaser
or its agents or counsel with any information that the Company believes constitutes material non-public information, unless prior
thereto such Purchaser shall have entered into a written agreement with the Company regarding the confidentiality and use of such
information. The Company understands and confirms that each Purchaser shall be relying on the foregoing covenant in effecting
transactions in securities of the Company.


 


4.9Use
of Proceeds. The Company shall use the net proceeds from the sale of the Securities hereunder for working capital purposes
and shall not use such proceeds: (a) for the satisfaction of any portion of the Company’s debt (other than payment of trade
payables in the ordinary course of the Company’s business and prior practices), (b) for the redemption of any Common Stock
or Common Stock Equivalents, (c) for the settlement of any outstanding litigation or (d) in violation of FCPA or OFAC regulations.
The proceeds of the offering will be employed by the Company substantially for the purposes set forth on Schedule 4.9.


 


4.10Indemnification
of Purchasers. Subject to the provisions of this Section 4.10, the Company will indemnify and hold each Purchaser and its
directors, officers, shareholders, members, partners, employees and agents (and any other Persons with a functionally equivalent
role of a Person holding such titles notwithstanding a lack of such title or any other title), each Person who controls such Purchaser
(within the meaning of Section 15 of the Securities Act and Section 20 of the Exchange Act), and the directors, officers, shareholders,
agents, members, partners or employees (and any other Persons with a functionally equivalent role of a Person holding such titles
notwithstanding a lack of such title or any other title) of such controlling persons (each, a “Purchaser Party”)
harmless from any and all losses, liabilities, obligations, claims, contingencies, damages, costs and expenses, including all
judgments, amounts paid in settlements, court costs and reasonable attorneys’ fees and costs of investigation that any such
Purchaser Party may suffer or incur as a result of or relating to (a) any breach of any of the representations, warranties, covenants
or agreements made by the Company in this Agreement or in the other Transaction Documents or (b) any action instituted against
Purchaser Parties in any capacity, or any of them or their respective Affiliates, by any stockholder of the Company who is not
an Affiliate of such Purchaser Party, with respect to any of the transactions contemplated by the Transaction Documents (unless
such action is based upon a breach of such Purchaser Party’s representations, warranties or covenants under the Transaction
Documents or any agreements or understandings such Purchaser Party may have with any such stockholder or any violations by such
Purchaser Party of state or federal securities laws or any conduct by such Purchaser Party which constitutes fraud, gross negligence,
willful misconduct or malfeasance). If any action shall be brought against any Purchaser Party in respect of which indemnity may
be sought pursuant to this Agreement, such Purchaser Party shall promptly notify the Company in writing, and the Company shall
have the right to assume the defense thereof with counsel of its own choosing reasonably acceptable to the Purchaser Party. Any
Purchaser Party shall have the right to employ separate counsel in any such action and participate in the defense thereof, but
the fees and expenses of such counsel shall be at the expense of such Purchaser Party except to the extent that (i) the employment
thereof has been specifically authorized by the Company in writing, (ii) the Company has failed after a reasonable period of time
to assume such defense and to employ counsel or (iii) in such action there is, in the reasonable opinion of counsel, a material
conflict on any material issue between the position of the Company and the position of such Purchaser Party, in which case the
Company shall be responsible for the reasonable fees and expenses of no more than one such separate counsel. The Company will
not be liable to any Purchaser Party under this Agreement (y) for any settlement by a Purchaser Party effected without the Company’s
prior written consent, which shall not be unreasonably withheld or delayed; or (z) to the extent, but only to the extent that
a loss, claim, damage or liability is attributable to any Purchaser Party’s breach of its representations, warranties or
covenants under the Transaction Documents. The indemnification required by this Section 4.10 shall be made by periodic payments
of the amount thereof during the course of the investigation or defense, as and when bills are received or are incurred. The indemnity
agreements contained herein shall be in addition to any cause of action or similar right of any Purchaser Party against the Company
or others and any liabilities the Company may be subject to pursuant to law.


 






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4.11Reservation
and Listing of Securities.


 


(a)The
Company shall maintain a reserve from its duly authorized shares of Common Stock for issuance pursuant to the Transaction Documents
in such amount as may then be required to fulfill its obligations in full under the Transaction Documents, but not less than the
Required Minimum.


 


(b)If,
on any date, the number of authorized but unissued (and otherwise unreserved) shares of Common Stock is less than the Required
Minimum on such date, then the Board of Directors shall amend the Company’s certificate or articles of incorporation to
increase the number of authorized but unissued shares of Common Stock to at least the Required Minimum at such time, as soon as
possible and in any event not later than the 60th day after such date.


 


(c)The
Company shall, if applicable: (i) in the time and manner required by the principal Trading Market, prepare and file with such
Trading Market an additional shares listing application covering a number of shares of Common Stock at least equal to the Required
Minimum on the date of such application, (ii) take all steps necessary to cause such shares of Common Stock to be approved for
listing or quotation on such Trading Market as soon as possible thereafter, (iii) provide to the Purchasers evidence of such listing
or quotation and (iv) maintain the listing or quotation of such Common Stock on any date at least equal to the Required Minimum
on such date on such Trading Market or another Trading Market. The Company will then take all action necessary to continue the
listing or quotation and trading of its Common Stock on a Trading Market until the later of (i) at least five years after the
Final Closing Date, and (ii) for so long as the Warrants are outstanding, and will comply in all respects with the Company’s
reporting, filing and other obligations under the bylaws or rules of the Trading Market at least until five years after the Final
Closing Date and for so long as the Warrants are outstanding. In the event the aforedescribed listing is not continuously maintained
for five years after the Final Closing Date (a “Listing Default”), then in addition to any other rights the
Purchasers may have hereunder or under applicable law, on the first day of a Listing Default and on each monthly anniversary of
each such Listing Default date (if the applicable Listing Default shall not have been cured by such date) until the applicable
Listing Default is cured, the Company shall pay to each Purchaser an amount in cash, as partial liquidated damages and not as
a penalty, equal to 2% of the aggregate Subscription Amount and purchase price of Warrant Shares held by such Purchaser on the
day of a Listing Default and on every thirtieth day (pro-rated for periods less than thirty days) thereafter until the date such
Listing Default is cured. If the Company fails to pay any liquidated damages pursuant to this Section in a timely manner, the
Company will pay interest thereon at a rate of 1.5% per month (pro-rated for partial months) to the Purchaser.


 






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4.12Form
D; Blue Sky Filings. The Company agrees to timely file a Form D with respect to the Securities as required under Regulation
D and to provide a copy thereof, promptly upon request of any Purchaser. The Company shall take such action as the Company shall
reasonably determine is necessary in order to obtain an exemption for, or to qualify the Securities for, sale to the Purchasers
at the Closing under applicable securities or “Blue Sky” laws of the states of the United States, and shall provide
evidence of such actions promptly upon request of any Purchaser.


 


4.13Subsequent
Equity Sales. From the date hereof until such time as the Notes and Warrants are no longer outstanding, the Company will not,
without the consent of the Purchasers, enter into any Equity Line of Credit or similar agreement, nor issue nor agree to issue
any common stock, Common Stock Equivalents, floating or Variable Priced Equity Linked Instruments nor any of the foregoing or
equity with price reset rights (subject to adjustment for stock splits, distributions, dividends, recapitalizations and the like)
(collectively, the “Variable Rate Transaction”). For purposes hereof, “Equity Line of Credit”
shall include any transaction involving a written agreement between the Company and an investor or underwriter whereby the Company
has the right to “put” its securities to the investor or underwriter over an agreed period of time and at an agreed
price or price formula, and “Variable Priced Equity Linked Instruments” shall include: (A) any debt or equity
securities which are convertible into, exercisable or exchangeable for, or carry the right to receive additional shares of Common
Stock either (1) at any conversion, exercise or exchange rate or other price that is based upon and/or varies with the trading
prices of or quotations for Common Stock at any time after the initial issuance of such debt or equity security, or (2) with a
fixed conversion, exercise or exchange price that is subject to being reset at some future date at any time after the initial
issuance of such debt or equity security due to a change in the market price of the Company’s Common Stock since date of
initial issuance, and (B) any amortizing convertible security which amortizes prior to its maturity date, where the Company is
required or has the option to (or any investor in such transaction has the option to require the Company to) make such amortization
payments in shares of Common Stock which are valued at a price that is based upon and/or varies with the trading prices of or
quotations for Common Stock at any time after the initial issuance of such debt or equity security (whether or not such payments
in stock are subject to certain equity conditions). For purposes of determining the total consideration for a convertible instrument
(including a right to purchase equity of the Company) issued, subject to an original issue or similar discount or which principal
amount is directly or indirectly increased after issuance, the consideration will be deemed to be the actual cash amount received
by the Company in consideration of the original issuance of such convertible instrument. Until twenty-four (24) months after the
Closing Date, the Company will not issue any Common Stock or Common Stock Equivalents to officers, directors, employees, consultants
and service providers of the Company except in the amounts and on the terms set forth on Schedule 4.13. For so long as
the Notes or Warrants are outstanding, the Company will not amend the terms of any securities or Common Stock Equivalents or of
any agreement outstanding or in effect as of the date of this Agreement pursuant to which same were or may be acquired nor issue
any Common Stock or Common Stock Equivalents, if such issuance or the result of such amendment would be at an effective price
per share of Common Stock less than the higher of the Conversion Price or Warrant Exercise Price in effect at the time of such
lower price issuance or amendment or would be issued or made on terms more favorable to such other holder or recipient than the
Purchaser, with respect to the terms of the offering pursuant to the Transaction Documents.


 






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4.14Equal
Treatment of Purchasers. No consideration (including any modification of any Transaction Document) shall be offered or paid
to any Person to amend or consent to a waiver or modification of any provision of any of this Agreement unless the same consideration
is also offered on a ratable basis to all of the parties to this Agreement. For clarification purposes, this provision constitutes
a separate right granted to each Purchaser by the Company and negotiated separately by each Purchaser, and is intended for the
Company to treat the Purchasers as a class and shall not in any way be construed as the Purchasers acting in concert or as a group
with respect to the purchase, disposition or voting of Securities or otherwise. 


 


4.15Purchase
Price Reset. From the date of this Agreement until the sooner of (i) the Purchaser and his permitted assigns no longer holds
any Securities, and (ii) five years after the Closing Date (the “Protection Period”), in the event that the
Company issues or sells any shares of Common Stock or any Common Stock Equivalent (calculated on an as converted, as exercised
basis) pursuant to which shares of Common Stock may be acquired at a price less than the Per Share Purchase Price (a “Share
Dilutive Issuance”) (adjusted as described in Section 5.23), then the Company shall promptly issue additional shares
of Common Stock to the Purchasers who held outstanding Shares on the date of such Share Dilutive Issuance, for no additional consideration,
in an amount sufficient that (a) the aggregate Subscription Amount paid at the Closing for such outstanding Shares held by Purchasers
on the date of such Share Dilutive Issuance (whether or not such Purchasers were the Purchasers at the Closing), when divided
by (x) the sum of (i) the total number of outstanding Shares held by the Purchasers on the date of such Share Dilutive Issuance,
(ii) any other shares of Common Stock then or theretofore issued in respect of such outstanding Shares (by stock split, stock
dividend or otherwise) that resulted in an adjustment to the Per Share Purchase Price referred to above pursuant to Section 5.23,
and (iii) all Additional Shares issued with respect to such outstanding Shares held by the Purchasers on the date of such Share
Dilutive Issuance that were issued as a result of Share Dilutive Issuances that occurred prior to such Share Dilutive Issuance,
will equal the price per share of Common Stock in such Share Dilutive Issuance, (each such adjustment, a “Share Dilution
Adjustment”, and such shares, the “Additional Shares”). The Additional Shares to be issued in a Share
Dilution Adjustment shall be issued by the Company to the Purchasers who held outstanding Shares on the date of the applicable
Share Dilutive Issuance (in proportion to the number of such Shares held by such Purchasers on the date of such Share Dilutive
Issuance). Such Share Dilution Adjustment shall be made successively whenever such an issuance is made. Such Additional Shares
must be delivered to the applicable Purchasers not later than the date the Share Dilutive Issuance occurs.


 


From
the date of this Agreement until the end of the Protection Period, in the event that the Company issues or sells any shares of
Common Stock or any Common Stock Equivalent (calculated on an as converted, as exercised basis) pursuant to which shares of Common
Stock may be acquired at a price less than the exercise price per share of Common Stock that was paid during the Protection Period
by a Purchaser upon exercise of a Warrant (a “Warrant Dilutive Issuance”) (adjusted as described in Section
5.23), then the Company shall promptly issue additional shares of Common Stock to the Purchasers who on the date of such Warrant
Dilutive Issuance held the issued Warrant Shares that were issued upon such exercise, for no additional consideration, in an amount
sufficient that (a) the aggregate exercise price paid for such issued Warrant Shares held by the Purchasers on the date of such
Warrant Dilutive Issuance (whether or not such Purchasers were the Purchasers who exercised such Warrant), when divided by (x)
the sum of (i) the total number of such issued Warrant Shares held by the Purchasers on the date of such Warrant Dilutive Issuance,
(ii) any other shares of Common Stock then or theretofore issued in respect of such issued Warrant Shares (by stock split, stock
dividend or otherwise) that resulted in an adjustment to the exercise price referred to above pursuant to Section 5.23, and (iii)
all Additional Warrant Shares issued with respect to such issued Warrant Shares held by the Purchasers on the date of such Warrant
Dilutive Issuance that were issued as a result of Warrant Dilutive Issuances that occurred prior to such Warrant Dilutive Issuance,
will equal the price per share of Common Stock in such Warrant Dilutive Issuance, (each such adjustment, a “Warrant Dilution
Adjustment”, and such shares, the “Additional Warrant Shares”). The Additional Warrant Shares to
be issued in a Warrant Dilution Adjustment shall be issued by the Company to the Purchasers who held the applicable issued Warrant
Shares on the date of the applicable Warrant Dilutive Issuance (in proportion to the number of such issued Warrant Shares held
by such Purchasers on the date of such Warrant Dilutive Issuance). Such Warrant Dilution Adjustment shall be made successively
whenever such an issuance is made. Such Additional Warrant Shares must be delivered to the applicable Purchasers not later than
the date the Warrant Dilutive Issuance occurs.


 






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Notwithstanding
the foregoing, this Section 4.14 shall not apply in respect of an Exempt Issuance. No adjustment shall be made hereunder which
would require the Purchaser to surrender any shares to the Company. The holder of outstanding Additional Shares and Additional
Warrant Shares is granted the same rights and benefits as a holder of outstanding Shares pursuant to the Transaction Documents,
except the rights and benefits of this Section 4.14 and except that such rights and benefits shall not apply to a holder of outstanding
Additional Shares or Additional Warrant Shares after such outstanding Additional Share or Additional Warrant Share has been irrevocably
sold pursuant to an effective registration statement under the Securities Act or pursuant to Rule 144 without further restrictions
or conditions to transfer pursuant to Rule 144.


 


4.16Capital
Changes. Until the one year anniversary of the Closing Date, the Company shall not undertake a reverse or forward stock split
or reclassification of the Common Stock without 10 days prior written notice to the Purchasers, unless such reverse split is made
in conjunction with the listing of the Common Stock on a national securities exchange.


 


4.17Certain
Transactions and Confidentiality. Each Purchaser, severally and not jointly with the other Purchasers, covenants that neither
it, nor any Affiliate acting on its behalf or pursuant to any understanding with it will execute any purchases or sales, including
Short Sales, of any of the Company’s securities during the period commencing with the execution of this Agreement and ending
at such time that the transactions contemplated by this Agreement are first publicly announced pursuant to a press release or
Form 8-K as described in Section 4.6. Each Purchaser, severally and not jointly with the other Purchasers, covenants that until
such time as the transactions contemplated by this Agreement are publicly disclosed by the Company pursuant to a press release
or Form 8-K as described in Section 4.6, such Purchaser will maintain the confidentiality of the existence and terms of this transaction
and the information included in the Transaction Documents and the Disclosure Schedules. Notwithstanding the foregoing, and notwithstanding
anything contained in this Agreement to the contrary, the Company expressly acknowledges and agrees that (i) no Purchaser makes
any representation, warranty or covenant hereby that it will not engage in effecting transactions in any securities of the Company
after the time that the transactions contemplated by this Agreement are first publicly announced pursuant to a press release or
Form 8-K as described in Section 4.6, (ii) no Purchaser shall be restricted or prohibited from effecting any transactions in any
securities of the Company in accordance with applicable securities laws from and after the time that the transactions contemplated
by this Agreement are first publicly announced pursuant to a press release or Form 8-K, and (iii) no Purchaser shall have any
duty of confidentiality to the Company or its Subsidiaries after the filing of the Form 8-K. Notwithstanding the foregoing, in
the case of a Purchaser that is a multi-managed investment vehicle whereby separate portfolio managers manage separate portions
of such Purchaser’s assets and the portfolio managers have no direct knowledge of the investment decisions made by the portfolio
managers managing other portions of such Purchaser’s assets, the covenant set forth above shall only apply with respect
to the portion of assets managed by the portfolio manager that made the investment decision to purchase the Securities covered
by this Agreement.


 






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4.18Participation
in Future Financing.


 


(a)From
the date hereof until the Notes and Warrants are no longer outstanding, upon any proposed issuance by the Company or any of its
Subsidiaries of Common Stock, Common Stock Equivalents for cash consideration, Indebtedness or a combination thereof, other than
(i) a rights offering to all holders of Common Stock (which may include extending such rights offering to holders of Notes) or
(ii) an Exempt Issuance, (a “Subsequent Financing”), the Purchasers shall have the right to participate in
up to an amount of the Subsequent Financing equal to 100% of the Subsequent Financing (the “Participation Maximum”)
pro rata to each other in proportion to their Subscription Amounts on the same terms, conditions and price provided for in the
Subsequent Financing, unless the Subsequent Financing is an underwritten public offering, in which case the Company shall offer
each Purchaser the right to participate in such public offering when it is lawful for the Company to do so, but no Purchaser shall
be entitled to purchase any particular amount of such public offering.


 


(b)At
least five Trading Days prior to the closing of the Subsequent Financing, the Company shall deliver to each Purchaser a written
notice of its intention to effect a Subsequent Financing (“Pre-Notice”), which Pre-Notice shall ask such Purchaser
if it wants to review the details of such financing (such additional notice, a “Subsequent Financing Notice”).
Upon the request of a Purchaser, and only upon a request by such Purchaser, for a Subsequent Financing Notice, the Company shall
promptly, but no later than one (1) Trading Day after such request, deliver a Subsequent Financing Notice to such Purchaser. The
requesting Purchaser shall be deemed to have acknowledged that the Subsequent Financing Notice may contain material non-public
information. The Subsequent Financing Notice shall describe in reasonable detail the proposed terms of such Subsequent Financing,
the amount of proceeds intended to be raised thereunder and the Person or Persons through or with whom such Subsequent Financing
is proposed to be effected and shall include a term sheet or similar document relating thereto as an attachment.


 


(c)Any
Purchaser desiring to participate in such Subsequent Financing must provide written notice to the Company by not later than 5:30
p.m. (New York City time) on the fifth (5th) Trading Day after all of the Purchasers have received the Pre-Notice that
the Purchaser is willing to participate in the Subsequent Financing, the amount of such Purchaser’s participation, and representing
and warranting that such Purchaser has such funds ready, willing, and available for investment on the terms set forth in the Subsequent
Financing Notice. If the Company receives no such notice from a Purchaser as of such fifth (5th) Trading Day, such
Purchaser shall be deemed to have notified the Company that it does not elect to participate.


 


(d)If
by 5:30 p.m. (New York City time) on the fifth (5th ) Trading Day after all of the Purchasers have received the Pre-Notice,
notifications by the Purchasers of their willingness to participate in the Subsequent Financing (or to cause their designees to
participate) is, in the aggregate, less than the total amount of the Subsequent Financing, then the Company may affect the remaining
portion of such Subsequent Financing on the terms and with the Persons set forth in the Subsequent Financing Notice.


 


(e)If
by 5:30 p.m. (New York City time) on the fifth (5th) Trading Day after all of the Purchasers have received the Pre-Notice,
the Company receives responses to a Subsequent Financing Notice from Purchasers seeking to purchase more than the aggregate amount
of the Participation Maximum, each such Purchaser shall have the right to purchase its Pro Rata Portion (as defined below) of
the Participation Maximum. “Pro Rata Portion” means the ratio of (x) the principal amount of Notes purchased
hereunder by a Purchaser participating under this Section 4.18 and (y) the sum of the aggregate principal amounts of Notes purchased
hereunder by all Purchasers participating under this Section 4.18.


 


(f)The
Company must provide the Purchasers with a second Subsequent Financing Notice, and the Purchasers will again have the right of
participation set forth above in this Section 4.18, if the Subsequent Financing subject to the initial Subsequent Financing Notice
is not consummated for any reason on the terms set forth in such Subsequent Financing Notice within thirty (30) Trading Days after
the date of the initial Subsequent Financing Notice.


 






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(g)The
Company and each Purchaser agree that if any Purchaser elects to participate in the Subsequent Financing, the transaction documents
related to the Subsequent Financing shall not include any term or provision whereby such Purchaser shall be required to agree
to any restrictions on trading as to any of the Securities purchased hereunder (for avoidance of doubt, the securities purchased
in the Subsequent Financing shall not be considered securities purchased hereunder) or be required to consent to any amendment
to or termination of, or grant any waiver, release or the like under or in connection with, this Agreement, without the prior
written consent of such Purchaser.


 


(h)Notwithstanding
anything to the contrary in this Section 4.18 and unless otherwise agreed to by such Purchaser, the Company shall either confirm
in writing to such Purchaser that the transaction with respect to the Subsequent Financing has been abandoned or shall publicly
disclose its intention to issue the securities in the Subsequent Financing, in either case in such a manner such that such Purchaser
will not be in possession of any material, non-public information, by the tenth (10th) Business Day following delivery of the
Subsequent Financing Notice. If by such tenth (10th) Business Day, no public disclosure regarding a transaction with respect to
the Subsequent Financing has been made, and no notice regarding the abandonment of such transaction has been received by such
Purchaser, such transaction shall be deemed to have been abandoned and such Purchaser shall not be deemed to be in possession
of any material, non-public information with respect to the Company or any of its Subsidiaries.


 


4.19Maintenance
of Property. The Company shall keep all of its property, which is necessary or useful to the conduct of its business, in good
working order and condition, ordinary wear and tear excepted.


 


4.20Preservation
of Corporate Existence. The Company shall preserve and maintain its corporate existence, rights, privileges and franchises
in the jurisdiction of its incorporation, and qualify and remain qualified, as a foreign corporation in each jurisdiction in which
such qualification is necessary in view of its business or operations and where the failure to qualify or remain qualified might
reasonably have a Material Adverse Effect upon the financial condition, business or operations of the Company taken as a whole.


 


4.21Most
Favored Nation Provision. From the date hereof until the later of (i) such time as no Purchaser holds any Securities and (ii)
three (3) years after the Closing Date in the event that the Company issues or sells any Common Stock, if a Purchaser then holding
outstanding Securities reasonably believes that any of the terms and conditions appurtenant to such issuance or sale are more
favorable to such investors than are the terms and conditions granted to the Purchasers hereunder, upon notice to the Company
by such Purchaser within five Trading Days after disclosure of such issuance or sale, the Company shall amend the terms of this
transaction as to such Purchaser only so as to give such Purchaser the benefit of such more favorable terms or conditions. This
Section 4.21 shall not apply with respect to an Exempt Issuance. The Company shall provide each Purchaser with notice of any such
issuance or sale in the manner for disclosure of Subsequent Financings set forth in Section 4.18.


 


4.22DTC
Program. At all times that Notes or Warrants are outstanding, the Company shall use its best efforts to employ as the transfer
agent for the Common Stock and Warrant Shares a participant in the Depository Trust Company Automated Securities Transfer Program
and cause the Common Stock to be transferable pursuant to such program.


 






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4.23Piggy-Back
Registrations. If at any time after the Closing Date there is not an effective registration statement covering all of the
issued Underlying Shares and Warrant Shares and the Company determines to prepare and file with the Commission a registration
statement relating to an offering for its own account or the account of others under the Securities Act of any of its equity securities,
but excluding Forms S-4 or S-8 and similar forms which do not permit such registration, then the Company shall send to each holder
of any of the issued Securities written notice of such determination and, if within fifteen calendar days after receipt of such
notice, any such holder shall so request in writing, the Company shall include in such registration statement all or any part
of the Underlying Shares, and Warrant Shares such holder requests to be registered and which inclusion of such Underlying Shares
and Warrant Shares will be subject to customary underwriter cutbacks applicable to all holders of registration rights and minimum
cutbacks in accordance with guidance provided by the Securities and Exchange Commission (including, but not limited to, Rule 415).
The obligations of the Company under this Section may be waived by any holder of any of the Securities entitled to registration
rights under this Section 4.23. The holders whose Underlying Shares and Warrant Shares are included or required to be included
in such registration statement are granted the same rights, benefits, liquidated or other damages and indemnification granted
to other holders of securities included in such registration statement. In no event shall the liability of any holder of Securities
or permitted successor in connection with any Underlying Shares and Warrant Shares included in any such registration statement
be greater in amount than the dollar amount of the net proceeds actually received by such Purchaser upon the sale of the Underlying
Shares and Warrant Shares sold pursuant to such registration or such lesser amount in proportion to all other holders of Securities
included in such registration statement. All expenses incurred by the Company in complying with Section 4.23, including, without
limitation, all registration and filing fees, printing expenses (if required), fees and disbursements of counsel and independent
public accountants for the Company, fees and expenses (including reasonable counsel fees) incurred in connection with complying
with state securities or “blue sky” laws, fees of the FINRA, transfer taxes, and fees of transfer agents and registrars,
are called “Registration Expenses.” All underwriting discounts and selling commissions applicable to the sale
of Registrable Securities are called "Selling Expenses." The Company will pay all Registration Expenses in connection
with the registration statement under Section 4.23. Selling Expenses in connection with each registration statement under Section
4.23 shall be borne by the holder and will be apportioned among such holders in proportion to the number of Shares included therein
for a holder relative to all the securities included therein for all selling holders, or as all holders may agree. It shall be
a condition precedent to the obligations of the Company to complete the registration pursuant to this Agreement with respect to
the Underlying Shares and Warrant Shares of a particular Purchaser that such Purchaser shall furnish to the Company in writing
such information and representation letters, including a completed form of a securityholder questionnaire, with respect to itself
and the proposed distribution by it as the Company may reasonably request to assure compliance with federal and applicable state
securities laws.


 


4.24Purchaser’s
Exercise Limitations. The Company shall not effect any exercise of the rights granted in Section 4.21 of this Agreement, and
a Purchaser shall not have the right to exercise any portion of such rights granted in Section 4.21 to the extent that after giving
effect to such exercise, the Purchaser (together with the Purchaser’s Affiliates, and any other Persons acting as a group
together with the Purchaser or any of the Purchaser’s Affiliates), would beneficially own in excess of the Beneficial Ownership
Limitation (as defined in the Note), applied in the manner set forth in the Note.


 


4.25Reimbursement.
If any Purchaser becomes involved in any capacity in any Proceeding by or against any Person who is a stockholder of the Company
(except as a result of sales, pledges, margin sales and similar transactions by such Purchaser to or with any current stockholder),
solely as a result of such Purchaser’s acquisition of the Securities under this Agreement, the Company will reimburse such
Purchaser for its reasonable legal and other expenses (including the cost of any investigation preparation and travel in connection
therewith) incurred in connection therewith, as such expenses are incurred. The reimbursement obligations of the Company under
this paragraph shall be in addition to any liability which the Company may otherwise have, shall extend upon the same terms and
conditions to any Affiliates of the Purchasers who are actually named in such action, proceeding or investigation, and partners,
directors, agents, employees and controlling persons (if any), as the case may be, of the Purchasers and any such Affiliate, and
shall be binding upon and inure to the benefit of any successors, assigns, heirs and personal representatives of the Company,
the Purchasers and any such Affiliate and any such Person. The Company also agrees that neither the Purchasers nor any such Affiliates,
partners, directors, agents, employees or controlling persons shall have any liability to the Company or any Person asserting
claims on behalf of or in right of the Company solely as a result of acquiring the Securities under this Agreement.


 






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ARTICLE
V.


MISCELLANEOUS


 


5.1Termination.
This Agreement may be terminated by any Purchaser, as to such Purchaser’s obligations hereunder only and without any effect
whatsoever on the obligations between the Company and the other Purchasers, by written notice to the other parties, if the Closing
has not been consummated on or before October 15, 2014; provided, however, that such termination will not affect
the right of any party to sue for any breach by any other party (or parties).


 


5.2Fees
and Expenses. At the Closing, the Company has agreed to pay G&M for the legal fees in connection with the Closing of some,
but not all, of the Purchasers in the amount of $10,000. Except as expressly set forth in the Transaction Documents and on Schedule
3.1(s), each party shall pay the fees and expenses of its advisers, counsel, accountants and other experts, if any, and all
other expenses incurred by such party incident to the negotiation, preparation, execution, delivery and performance of this Agreement.
The Company shall pay all Transfer Agent fees (including, without limitation, any fees required for same-day processing of any
instruction letter delivered by the Company and any conversion or exercise notice delivered by a Purchaser), stamp taxes and other
taxes and duties levied in connection with the delivery of any Securities to the Purchasers.


 


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


 


5.4Notices.
All notices, demands, requests, consents, approvals, and other communications required or permitted hereunder shall be in writing
and, unless otherwise specified herein, shall be (i) personally served, (ii) deposited in the mail, registered or certified, return
receipt requested, postage prepaid, (iii) delivered by reputable air courier service with charges prepaid, or (iv) transmitted
by hand delivery, telegram, or facsimile, addressed as set forth below or to such other address as such party shall have specified
most recently by written notice. Any notice or other communication required or permitted to be given hereunder shall be deemed
effective (a) upon hand delivery or delivery by facsimile, with accurate confirmation generated by the transmitting facsimile
machine, at the address or number designated below (if delivered on a business day during normal business hours where such notice
is to be received), or the first business day following such delivery (if delivered other than on a business day during normal
business hours where such notice is to be received) or (b) on the second business day following the date of mailing by express
courier service, fully prepaid, addressed to such address, or upon actual receipt of such mailing, whichever shall first occur.
The addresses for such communications shall be: (i) if to the Company, to: Wally World Media, Inc., 65 Church Street, 2nd
Floor, New Brunswick, NJ 08901, Attn: Darin Myman, Chief Executive Officer, facsimile: 732-246-0439 with a copy by fax only
to (which shall not constitute notice): Szaferman, Lakind, Blumstein & Blader, P.C., 101 Grovers Mill Road, Suite 200, Lawrenceville,
NJ 08648, Attn: Gregg Jaclin, Esq., facsimile: (609) 275-4511, and (ii) if to the Purchasers, to: the addresses and fax numbers
indicated on the signature pages hereto, with an additional copy by fax only to (which shall not constitute notice): Grushko &
Mittman, P.C., 515 Rockaway Avenue, Valley Stream, New York 11581, facsimile: (212) 697-3575.


 






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


 


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


 


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


 


5.8No
Third-Party Beneficiaries. This Agreement is intended for the benefit of the parties hereto and their respective successors
and permitted assigns and is not for the benefit of, nor may any provision hereof be enforced by, any other Person, except as
otherwise set forth in Section 4.10.


 


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


 






    	36



    	 



    

 


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


 


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


 


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


 


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


 


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


 


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


 






    	37



    	 



    

 


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


 


5.17Usury.
To the extent it may lawfully do so, the Company hereby agrees not to insist upon or plead or in any manner whatsoever claim,
and will resist any and all efforts to be compelled to take the benefit or advantage of, usury laws wherever enacted, now or at
any time hereafter in force, in connection with any claim, action or proceeding that may be brought by any Purchaser in order
to enforce any right or remedy under any Transaction Document. Notwithstanding any provision to the contrary contained in any
Transaction Document, it is expressly agreed and provided that the total liability of the Company under the Transaction Documents
for payments in the nature of interest shall not exceed the maximum lawful rate authorized under applicable law (the “Maximum
Rate”), and, without limiting the foregoing, in no event shall any rate of interest or default interest, or both of
them, when aggregated with any other sums in the nature of interest that the Company may be obligated to pay under the Transaction
Documents exceed such Maximum Rate. It is agreed that if the maximum contract rate of interest allowed by law and applicable to
the Transaction Documents is increased or decreased by statute or any official governmental action subsequent to the date hereof,
the new maximum contract rate of interest allowed by law will be the Maximum Rate applicable to the Transaction Documents from
the Closing Date thereof forward, unless such application is precluded by applicable law. If under any circumstances whatsoever,
interest in excess of the Maximum Rate is paid by the Company to any Purchaser with respect to indebtedness evidenced by the Transaction
Documents, such excess shall be applied by such Purchaser to the unpaid principal balance of any such indebtedness or be refunded
to the Company, the manner of handling such excess to be at such Purchaser’s election.


 


5.18Independent
Nature of Purchasers’ Obligations and Rights. The obligations of each Purchaser under any Transaction Document are several
and not joint with the obligations of any other Purchaser, and no Purchaser shall be responsible in any way for the performance
or non-performance of the obligations of any other Purchaser under any Transaction Document. Nothing contained herein or in any
other Transaction Document, and no action taken by any Purchaser pursuant hereto or thereto, shall be deemed to constitute the
Purchasers as a partnership, an association, a joint venture or any other kind of entity, or create a presumption that the Purchasers
are in any way acting in concert or as a group with respect to such obligations or the transactions contemplated by the Transaction
Documents. Each Purchaser shall be entitled to independently protect and enforce its rights, including, without limitation, the
rights arising out of this Agreement or out of the other Transaction Documents, and it shall not be necessary for any other Purchaser
to be joined as an additional party in any proceeding for such purpose. Each Purchaser has been represented by its own separate
legal counsel in its review and negotiation of the Transaction Documents. For reasons of administrative convenience only, each
Purchaser and its respective counsel have chosen to communicate with the Company through G&M. The Company has elected to provide
all Purchasers with the same terms and Transaction Documents for the convenience of the Company and not because it was required
or requested to do so by any of the Purchasers. It is expressly understood and agreed that each provision contained in this Agreement
and in each other Transaction Document is between the Company and a Purchaser, solely, and not between the Company and the Purchasers
collectively and not between and among the Purchasers.


 


5.19Liquidated
Damages. The Company’s obligations to pay any partial liquidated damages or other amounts owing under the Transaction
Documents is a continuing obligation of the Company and shall not terminate until all unpaid partial liquidated damages and other
amounts have been paid notwithstanding the fact that the instrument or security pursuant to which such partial liquidated damages
or other amounts are due and payable shall have been canceled.


 






    	38



    	 



    

 


5.20Saturdays,
Sundays, Holidays, etc. If the last or appointed day for the taking of any action or the expiration of any right required
or granted herein shall not be a Business Day, then such action may be taken or such right may be exercised on the next succeeding
Business Day.


 


5.21Construction.
The parties agree that each of them and/or their respective counsel have reviewed and had an opportunity to revise the Transaction
Documents and, therefore, the normal rule of construction to the effect that any ambiguities are to be resolved against the drafting
party shall not be employed in the interpretation of the Transaction Documents or any amendments thereto. In addition, each and
every reference to share prices and shares of Common Stock in any Transaction Document shall be subject to adjustment for reverse
and forward stock splits, stock dividends, stock combinations and other similar transactions of the Common Stock that occur after
the date of this Agreement.


 


5.22WAIVER
OF JURY TRIAL. IN ANY ACTION, SUIT, OR PROCEEDING IN ANY JURISDICTION BROUGHT BY ANY PARTY AGAINST ANY OTHER PARTY, THE PARTIES
EACH KNOWINGLY AND INTENTIONALLY, TO THE GREATEST EXTENT PERMITTED BY APPLICABLE LAW, HEREBY ABSOLUTELY, UNCONDITIONALLY, IRREVOCABLY
AND EXPRESSLY WAIVES FOREVER TRIAL BY JURY. 


 


5.23Equitable
Adjustment. Trading volume amounts, price/volume amounts and similar figures in the Transaction Documents shall be equitably
adjusted (but without duplication) to offset the effect of stock splits, similar events and as otherwise described in this Agreement
and Warrants.


 


(Signature
Pages Follow)


 






    	39



    	 



    

 


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


 





	WALLY
        WORLD MEDIA, INC.

         

         
	Address
        for Notice:

         

        65
        Church Street, 2nd Floor

        New
        Brunswick, NJ 08901

        Fax:
        732-246-0439

	By:
                                                                                                                               

               Name:
        DARIN MYMAN

               Title:
        Chief Executive Officer

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

         

        Szaferman,
        Lakind, Blumstein & Blader, P.C.

        101
        Grovers Mill Road, Suite 200

        Lawrenceville,
        NJ 08648

        Attn:
        Gregg Jaclin, Esq.

        Fax:
(609) 275-4511 
	 


 


[REMAINDER
OF PAGE INTENTIONALLY LEFT BLANK


SIGNATURE
PAGE FOR PURCHASER FOLLOWS]


 






    	40



    	 



    

 


[PURCHASER
SIGNATURE PAGE TO WALLY WORLD MEDIA, INC. 


SECURITIES
PURCHASE AGREEMENT]


  


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


 


Name of Purchaser: ________________________________________________________


 


Signature of Authorized Signatory of Purchaser:
__________________________________


 


Name of Authorized Signatory: ____________________________________________________


 


Title of Authorized Signatory: _____________________________________________________


 


Email Address of Authorized Signatory: _____________________________________________


 


Facsimile Number of Authorized Signatory: __________________________________________


 


Address for Notice to Purchaser:


 


 


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


 


 


Aggregate Closing Subscription Amount: US$________________


  


Closing Note principal amount: ___________________


 


Closing Class A Warrants: ___________________


 


Closing Class B Warrants: _____________________


 


EIN Number, if applicable, will be provided under separate cover:
________________________


  


Date: ___________________________


 


[SIGNATURE PAGES CONTINUE]


 






    	41



    	 



    

 


EXHIBIT D


 


ACCREDITED INVESTOR QUESTIONNAIRE


IN CONNECTION WITH INVESTMENT IN NOTES AND
WARRANTS 


OF WALLY WORLD MEDIA, INC,


A NEVADA CORPORATION


PURSUANT TO SECURITIES PURCHASE AGREEMENT
DATED SEPTEMBER ___, 2014


 


	TO :	Wally World Media, Inc.
	 	65 Church Street, 2nd Floor
	 	New Brunswick, NJ 08901
	 	Fax: 732-246-0439




 


INSTRUCTIONS


 


PLEASE ANSWER ALL QUESTIONS. If the appropriate
answer is “None” or “Not Applicable”, so state. Please print or type your answers to all questions. Attach
additional sheets if necessary to complete your answers to any item.


 


Your answers will be kept strictly confidential
at all times. However, Wally World Media, Inc. (the “Company”) may present this Questionnaire to such parties as it
deems appropriate in order to assure itself that the offer and sale of securities of the Company will not result in a violation
of the registration provisions of the Securities Act of 1933, as amended, or a violation of the securities laws of any state.


 


1. Please provide the following information:


 


Name:________________________________________________________________________


 


Name of additional purchaser:______________________________________________________

(Please complete information in Question 5)


 


Date of birth, or if other than an individual, year of organization
or incorporation:


 


_____________________________________________________________________________


 


_____________________________________________________________________________


 


2. Residence address, or if other than an individual,
principal office address:


 


_____________________________________________________________________________


 


_____________________________________________________________________________


 


_____________________________________________________________________________


 


Telephone number:______________________________________________________________


 


Social Security Number:___________________________________________________________


 


Taxpayer Identification Number:____________________________________________________


 






    	42



    	 



    

 


3. Business address:_____________________________________________________________


 


_____________________________________________________________________________


 


_____________________________________________________________________________


 


Business telephone number:_______________________________________________________


 


4. Send mail to:                          Residence ______                    Business _______


 


5. With respect to tenants in common,
joint tenants and tenants by the entirety, complete only if information differs from that above:


 


Residence address:______________________________________________________________


 


_____________________________________________________________________________


 


_____________________________________________________________________________


 


Telephone number:______________________________________________________________


 


Social Security Number:___________________________________________________________


 


Taxpayer Identification Number:____________________________________________________


 


Business address:_______________________________________________________________


 


_____________________________________________________________________________


 


_____________________________________________________________________________


 


Business telephone number:_______________________________________________________


 


Send Mail to:                             Residence _______                  Business _______


 


6. Please describe your present or most recent business or
occupation and indicate such information as the nature of your employment, how long you have been employed there, the
principal business of your employer, the principal activities under your management or supervision and the scope (e.g. dollar
volume, industry rank, etc.) of such activities:


 


_____________________________________________________________________________


 


_____________________________________________________________________________


 


_____________________________________________________________________________


 






    	43



    	 



    

 


7. Please state whether you (i) are
associated with or affiliated with a member of the Financial Industry Regulatory Association, Inc. (“FINRA”),
(ii) are an owner of stock or other securities of FINRA member (other than stock or other securities purchased on the open
market), or (iii) have made a subordinated loan to any FINRA member:


 





	 	 	 	 	 
	 	Yes	 	No	 







 


If you answered yes to any of (i) – (iii)
above, please indicate the applicable answer and briefly describe the facts below:


 


______________________________________________________________________________


 


______________________________________________________________________________


 


______________________________________________________________________________


 


8A. Applicable to Individuals ONLY. Please answer the
following questions concerning your financial condition as an “accredited investor” (within the meaning of Rule
501 of Regulation D). If the purchaser is more than one individual, each individual must initial an answer where the question
indicates a “yes” or “no” response and must answer any other question fully, indicating to which
individual such answer applies. If the purchaser is purchasing jointly with his or her spouse, one answer may be indicated
for the couple as a whole:


 


8.1 Does your net worth* (or joint net worth with your
spouse) exceed $1,000,000?


 





	 	 	 	 	 
	 	Yes	 	No	 


 


8.2 Did you have an individual income** in excess of $200,000
or joint income together with your spouse in excess of $300,000 in each of the two most recent years (2012 and 2013) and do you
reasonably expect to reach the same income level in the current year (2014)?


 


	 	 	 	 	 
	 	Yes	 	No	 


 


8.3 Are you an executive officer of the
Company?


 





	 	 	 	 	 
	 	Yes	 	No	 


 


* For purposes hereof, net worth shall be deemed to include ALL
of your assets, liquid or illiquid MINUS any liabilities.


 


** For purposes hereof, the term “income” is not limited
to “adjusted gross income” as that term is defined for federal income tax purposes, but rather includes certain items
of income which are deducted in computing “adjusted gross income”. For investors who are salaried employees, the gross
salary of such investor, minus any significant expenses personally incurred by such investor in connection with earning the salary,
plus any income from any other source including unearned income, is a fair measure of “income” for purposes hereof.
For investors who are self-employed, “income” is generally construed to mean total revenues received during the calendar
year minus significant expenses incurred in connection with earning such revenues.


 






    	44



    	 



    

 


8.B Applicable to Corporations, Partnerships, Trusts, Limited
Liability Companies and other Entities ONLY:


 


The purchaser is an accredited investor because the purchaser falls
within at least one of the following categories (Check all appropriate lines):


 


		___	(i) a bank as defined in Section 3(a)(2) of the Act or a savings and loan association or other institution as defined in Section
3(a)(5)(A) of the Act whether acting in its individual or fiduciary capacity;



 


		___	(ii) a broker-dealer registered pursuant to Section 15 of the Securities Exchange Act of 1934, as amended;



 


		___	(iii) an insurance company as defined in Section 2(13) of the Act;



 


		___	(iv) an investment company registered under the Investment Company Act of 1940, as amended (the “Investment Act”)
or a business development company as defined in Section 2(a)(48) of the Investment Act;



 


		___	(v) a Small Business Investment Company licensed by the U.S. Small Business Administration under Section 301(c) or (d) of the
Small Business Investment Act of 1958, as amended;



 


		___	(vi) a plan established and maintained by a state, its political subdivisions, or any agency or instrumentality of a state
or its political subdivisions, for the benefit of its employees, where such plan has total assets in excess of $5,000,000;



 


		___	(vii) an employee benefit plan within the meaning of Title 1 of the Employee Retirement Income Security Act of 1974, as amended
(the “Employee Act”), where the investment decision is made by a plan fiduciary, as defined in Section 3(21) of the
Employee Act, which is either a bank, savings and loan association, insurance company, or registered investment adviser, or an
employee benefit plan that has total assets in excess of $5,000,000, or a self-directed plan the investment decisions of which
are made solely by persons that are accredited investors;



 


		___	(viii) a private business development company, as defined in Section 202(a)(22) of the Investment Advisers Act of 1940, as
amended;



 


		___	(ix) an organization described in Section 501(c)(3) of the Internal Revenue Code, a corporation, a Massachusetts or similar
business trust, or a partnership, not formed for the specific purpose of acquiring the securities offered, with total assets in
excess of $5,000,000;



 


		___	(x) a trust, with total assets in excess of $5,000,000, not formed for the specific purpose of acquiring the securities offered,
whose purchase is directed by a “sophisticated” person, as described in Rule 506(b)(2)(ii) promulgated under the Act,
who has such knowledge and experience in financial and business matters that he or she is capable of evaluating the merits and
risks of the prospective investment;



 






    	45



    	 



    

 


		___	(xi) an entity in which all of the equity investors are persons or entities described above (“accredited investors”).
ALL EQUITY OWNERS MUST COMPLETE “EXHIBIT A” ATTACHED HERETO.



 


9.A Do you have sufficient knowledge and
experience in financial and business matters so as to be capable of evaluating the merits and risks associated with investing
in the Company?


 





	 	 	 	 	 
	 	Yes	 	No	 


 


ANSWER QUESTION 9B ONLY IF THE ANSWER TO QUESTION 9A WAS “NO.”


 


9.B If the answer to Question 9A was
“NO,” do you have a financial or investment adviser (a) that is acting in the capacity as a purchaser
representative and (b) who has sufficient knowledge and experience in financial and business matters so as to be capable of
evaluating the merits and risks associated with investing in the Company?


 





	 	 	 	 	 
	 	Yes	 	No	 


 


If you have a financial or investment adviser(s), please identify
each such person and indicate his or her business address and telephone number in the space below. (Each such person must complete,
and you must review and acknowledge, a separate Purchaser Representative Questionnaire which will be supplied at your request).


 


______________________________________________________________________________


 


______________________________________________________________________________


 


10. You have the right, will be afforded
an opportunity, and are encouraged to investigate the Company and review relevant factors and documents pertaining to the
officers of the Company, and the Company and its business and to ask questions of a qualified representative of the Company
regarding this investment and the properties, operations, and methods of doing business of the Company.


 


Have you or has your purchaser representative,
if any, conducted any such investigation, sought such documents or asked questions of a qualified representative of the Company
regarding this investment and the properties, operations, and methods of doing business of the Company?


 





	 	 	 	 	 
	 	Yes	 	No	 


 


If so, briefly describe:____________________________________________________________


 


______________________________________________________________________________


 


If so, have you completed your investigation and/or received satisfactory
answers to your questions?


 





	 	 	 	 	 
	 	Yes	 	No	 


 






    	46



    	 



    

 


11. Do you understand the nature of an investment in the
Company and the risks associated with such an investment?


 





	 	 	 	 	 
	 	Yes	 	No	 


 


12. Do you understand that there is no
guarantee of any financial return on this investment and that you will be exposed to the risk of losing your entire
investment?


 





	 	 	 	 	 
	 	Yes	 	No	 


 


13. Do you understand that this
investment is not liquid?


 





	 	 	 	 	 
	 	Yes	 	No	 


 


14. Do you have adequate means of
providing for your current needs and personal contingencies in view of the fact that this is not a liquid investment?


 





	 	 	 	 	 
	 	Yes	 	No	 


 


15. Are you aware of the Company’s
business affairs and financial condition, and have you acquired all such information about the Company as you deem necessary and
appropriate to enable you to reach an informed and knowledgeable decision to acquire the Interests?


 


	 	 	 	 	 
	 	Yes	 	No	 





 


16. Do you have a “pre-existing
relationship” with the Company or any of the officers of the Company?


 





	 	 	 	 	 
	 	Yes	 	No	 


 


(For purposes hereof, “pre-existing relationship” means
any relationship consisting of personal or business contacts of a nature and duration such as would enable a reasonably prudent
investor to be aware of the character, business acumen, and general business and financial circumstances of the person with whom
such relationship exists.)


 


If so, please name the individual or other person with whom you
have a pre-existing relationship and describe the relationship:


 


______________________________________________________________________________


 


______________________________________________________________________________


 









    	47



    	 



    

 


17. Exceptions to the representations
and warranties made in Section 3.2 of the Securities Purchase Agreement (if no exceptions, write “none” –
if left blank, the response will be deemed to be “none”):
___________________________________________________


 


______________________________________________________________________________


 


Dated: _______________, 2014


 


If purchaser is one or more individuals (all individuals must sign):


 


______________________________________________________________________________

(Type or print name of prospective purchaser)


 


______________________________________________________________________________

Signature of prospective purchaser


 


______________________________________________________________________________

Social Security Number


 


______________________________________________________________________________

(Type or print name of additional purchaser)


 


______________________________________________________________________________

Signature of spouse, joint tenant, tenant in common or other signature, if required


 


______________________________________________________________________________

Social Security Number


 






    	48



    	 



    

 





Annex A


 


Definition of Accredited Investor


 


The securities will only be sold to investors
who represent in writing in the Securities Purchase Agreement that they are accredited investors, as defined in Regulation D, Rule
501 under the Act which definition is set forth below:


 


1.A natural person whose net worth, or joint net worth with
spouse, at the time of purchase exceeds $1 million (excluding home); or


 


2.A natural person whose individual gross income exceeded $200,000
or whose joint income with that person’s spouse exceeded $300,000 in each of the last two years, and who reasonably expects
to exceed such income level in the current year; or


 


3.A trust with total assets in excess of $5 million, not formed
for the specific purpose of acquiring the securities offered, whose purchase is directed by a sophisticated person described in
Regulation D; or


 


4.A director or executive officer of the Company; or


 


5.The investor is an entity, all of the owners of which are
accredited investors; or


 


6.(a) bank as defined in Section 3(a)(2) of the Act, or any
savings and loan association or other institution as defined in Section 3(a)(5)(A) of the Act, (b) any broker or dealer registered
pursuant to Section 15 of the Securities Exchange Act of 1934, (c) an insurance Company as defined in Section 2(13) of the Act,
(d) an investment Company registered under the Investment Company Act of 1940 or a business development Company as defined in Section
2(a)(48) of such Act, (e) a Small Business Investment Company licensed by the United States Small Business Administration under
Section 301(c) or (d) of the Small Business Investment Act of 1958, (f) an employee benefit plan established and maintained by
a state, its political subdivisions, or any agency or instrumentality of a state or its political subdivisions, if such plan has
total assets in excess of $5 million, (g) an employee benefit plan within the meaning of Title I of the Employee Retirement Income
Securities Act of 1974, and the employee benefit plan has assets in excess of $5 million, or the investment decision is made by
a plan fiduciary, as defined in Section 3(21) of such act, that is either a bank, savings and loan institution, insurance Company,
or registered investment advisor, or, if a self-directed plan, with an investment decisions made solely by persons that are accredited
investors, (h) a private business development company as defined in Section 202(a)(22) of the Investment Advisers Act of 1940,
or (i) an organization described in Section 501(c)(3) of the Internal Revenue code, corporation, Massachusetts or similar business
trust, or partnership, not formed for the specific purpose of acquiring the securities offered, with assets in excess of $5 million.


 






    	49



    	 



    

 





EXHIBIT “A” TO ACCREDITED INVESTOR
QUESTIONNAIRE


 


ACCREDITED CORPORATIONS, PARTNERSHIPS, LIMITED LIABILITY COMPANIES,
TRUSTS OR OTHER ENTITIES INITIALING QUESTION 8B(xi) MUST PROVIDE THE FOLLOWING INFORMATION.


 


I hereby certify that set forth below is a complete list of all
equity owners in __________________ [NAME OF ENTITY], a                                               
[TYPE OF ENTITY] formed pursuant to the laws of the State of                                    
. I also certify that EACH SUCH OWNER HAS INITIALED THE SPACE OPPOSITE HIS OR HER NAME and that each such owner understands
that by initialing that space he or she is representing that he or she is an accredited individual investor satisfying the test
for accredited individual investors indicated under “Type of Accredited Investor.”


 





	 	 	 
	 	 	signature of authorized corporate officer, general partner or trustee
	 	 	 
	 	Name
    of Equity Owner	Type of Accredited Investor1
	 	 	 
	1.	 	 
	2.	 	 
	3.	 	 
	4.	 	 
	5.	 	 
	6.	 	 
	7.	 	 
	8.	 	 
	9.	 	 
	10.	 	 





 





 



[1]Indicate
which Subparagraph of 8.1 - 8.3 the equity owner satisfies.


 


 


50