Exhibit 10.2


 


AMENDED AND RESTATED SECURITIES
PURCHASE AGREEMENT


 


This AMENDED AND RESTATED SECURITIES PURCHASE
AGREEMENT  (the “Agreement”), dated as of February 22, 2021, is by and among Cannabics Pharmaceuticals Inc.,
a Nevada corporation with offices located at #3 Bethesda Metro Center, #700, Bethesda, Maryland 20814 (the
“Company”), and each of the investors listed on the Schedule of Buyers attached hereto (individually, a
“Buyer” and collectively, the “Buyers”).


 


RECITALS


 


A.           On
December 16, 2020, the Company entered into that certain Securities Purchase Agreement, by and between the Company and the Buyers (the
“Original Securities Purchase Agreement”), pursuant to which at the Initial Closing (as defined below), the Company
issued the Initial Notes (as defined below).


 


B.            The Company and the Holder desire to amend and restate the Original Securities Purchase Agreement in the form hereof.


 


C.            The Company and each Buyer is executing and delivering this Agreement in reliance upon the exemption from securities registration
afforded by Section 4(a)(2) of the Securities Act of 1933, as amended (the “1933 Act”), and Rule 506(b) of Regulation
D (“Regulation D”) as promulgated by the United States Securities and Exchange Commission (the “SEC”)
under the 1933 Act.


 


D.            The Company has authorized a new series of senior secured convertible notes of the Company, in the aggregate original principal
amount of $2,750,000, substantially in the form attached hereto as Exhibit A (the “Notes”), which Notes
shall be convertible into shares of Common Stock (as defined below).


 


E.             Each Buyer wishes to purchase, and the Company wishes to sell, upon the terms and conditions stated in this Agreement, (i) a Note
in the aggregate original principal amount set forth opposite such Buyer’s name in column (3) on the Schedule of Buyers (each, an
“Initial Note”, and collectively, the “Initial Notes”) (which aggregate principal amount for all
Buyers shall not exceed $825,000) (the shares of Common Stock issuable pursuant to the terms of the Initial Notes, including, without
limitation, upon conversion, as Pre-Delivery Shares (as defined in the Notes) or otherwise, collectively, the “Initial Conversion
Shares”), and (ii) a warrant to initially acquire up to that aggregate number of additional shares of Common Stock set forth
opposite such Buyer’s name in column (4) on the Schedule of Buyers, substantially in the form attached hereto as Exhibit B
(the “Warrants”) (as exercised, collectively, the “Warrant Shares”).


 


F.            Subject
to the terms and conditions set forth in this Agreement, the Company may require each Buyer to participate in one or more Additional
Closings (as defined below) for the purchase by such Buyer, and the sale by the Company, of (a) with respect to the First Additional
Closing (as defined below), a Note in an original principal amount of set forth opposite such Buyer’s name in column (2) on
the Schedule of Additional Closings (which aggregate principal amount for all Buyers shall not exceed $550,000), and (b) with
respect to the Second Additional Closing (as defined below), a Note in an original principal amount of set forth opposite such
Buyer’s name in column (3) on the Schedule of Additional Closings (which aggregate principal amount for all Buyers shall not
exceed $1,375,000) (each Note to be sold at an Additional Closing, an “Additional Note”, and collectively, the
“Additional Notes”)(the shares of Common Stock issuable pursuant to the terms of the Additional Notes, including,
without limitation, upon conversion, as Pre-Delivery Shares or otherwise, collectively, the “Additional Conversion
Shares” and, collectively with the Initial Conversion Shares, the “Conversion Shares”).


 


 


 


 






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G.            At the Closing, the parties hereto shall execute and deliver a Registration Rights Agreement, in the form attached hereto as Exhibit
C (the “Registration Rights Agreement”), pursuant to which the Company has agreed to provide certain registration
rights with respect to the Registrable Securities (as defined in the Registration Rights Agreement), under the 1933 Act and the rules
and regulations promulgated thereunder, and applicable state securities laws.


 


H.            The Notes, the Conversion Shares, the Warrants and the Warrant Shares are collectively referred to herein as the “Securities.”


 


I.              The Notes will rank senior to all outstanding and future indebtedness of the Company, and its Subsidiaries (as defined below) the
Notes will be secured by a first priority perfected security interest in all of the existing and future assets of the Company and its
direct and indirect Subsidiaries, including (i) a pledge of all of the capital stock of each of the Subsidiaries, as evidenced by a security
agreement in the form attached hereto as Exhibit D (the “Security Agreement”, and together with the Perfection
Certificate (as defined below) and the other security documents and agreements entered into in connection with this Agreement and each
of such other documents and agreements, as each may be amended or modified from time to time, collectively, the “Security Documents”),
and (ii) a guaranty executed by each Subsidiary of the Company, in the form attached hereto as Exhibit E (collectively,
the “Guaranties”) pursuant to which each of them guarantees the obligations of the Company under the Transaction Documents
(as defined below).


 


AGREEMENT


 


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


 


		1.	PURCHASE AND SALE OF NOTES AND WARRANTS.



 


(a)          Purchase of Notes and Warrants.


 


(i)   
Initial Closing. Subject to the satisfaction (or waiver) of the conditions set forth in Sections 6(a) and 7(a) below, the
Company shall issue and sell to each Buyer, and each Buyer severally, but not jointly, agrees to purchase from the Company on the Closing
Date (as defined below) an Initial Note in the original principal amount as is set forth opposite such Buyer’s name in column (3)
on the Schedule of Buyers along with Warrants to initially acquire up to that aggregate number of Warrant Shares as is set forth opposite
such Buyer’s name in column (4) on the Schedule of Buyers (the “Initial Closing”).


 


(ii)   
First Additional Closing. Subject to the satisfaction (or waiver) of the conditions set forth in Sections 1(b)(ii), 6(b)
and 7(b) below, the Company shall issue and sell to each Buyer, and each Buyer severally, but not jointly, shall purchase from the Company
on such Additional Closing Date (as defined below) with respect to the First Additional Closing Eligibility Date, an Additional Note in
the original principal amount as is set forth opposite such Buyer’s name in column (3) on the Schedule of Additional Closings (the
“First Additional Closing”).


 


(iii)   
Second Additional Closing. Subject to the satisfaction (or waiver) of the conditions set forth in Sections 1(b)(ii), 6(b)
and 7(b) below, the Company shall issue and sell to each Buyer, and each Buyer severally, but not jointly, shall purchase from the Company
on such Additional Closing Date with respect to the Second Additional Closing Eligibility Date, an Additional Note in the original principal
amount as is set forth opposite such Buyer’s name in column (3) on the Schedule of Additional Closings (the “Second Additional
Closing”).


 


(b)          Closing.
The Initial Closing and each Additional Closing are each referred to in this Agreement as a “Closing”. Each Closing
shall occur at the offices of Kelley Drye & Warren LLP, 101 Park Avenue, New York, NY 10178.


 


(i)   
Initial Closing. The date and time of the Initial Closing (the “Initial Closing Date”) shall be 10:00
a.m., New York time, on the first (1st) Business Day on which the conditions to the Closing set forth in Sections 6(a) and 7(a) below
are satisfied or waived (or such other date as is mutually agreed to by the Company and each Buyer). As used herein “Business
Day” means any day other than Saturday, Sunday or other day on which commercial banks in The City of New York are authorized
or required by law to remain closed; provided, however, for clarification, commercial banks shall not be deemed to be authorized
or required by law to remain closed due to “stay at home”, “shelter-in- place”, “non-essential employee”
or any other similar orders or restrictions or the closure of any physical branch locations at the direction of any governmental authority
so long as the electronic funds transfer systems (including for wire transfers) of commercial banks in The City of New York generally
are open for use by customers on such day.


 


(ii)    Additional Closings.




 


(1)         Additional Closing Date. If the Company delivers an Additional Closing Notice (as defined below), the date and time of the
applicable Additional Closing (each, an “Additional Closing Date,” and the Initial Closing Date and each Additional
Closing Date, each, a “Closing Date”) shall be 10:00 a.m., New York time, on the first (1st) Business Day on which
the conditions to such Additional Closing set forth in this Section 1(b)(ii), 6(b) and 7(b) below are satisfied or waived (or such other
date as is mutually agreed to by the Company and each Buyer).


 


 


 


 


 






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(2)         Additional
Closing Eligibility Dates; Maximum Additional Note Amounts. Subject to the satisfaction (or waiver) of the conditions set forth in
this Section 1(b)(ii) and Sections 6(b) and 7(b) below, the Company shall have the right to require each Buyer to purchase (A) with respect
to the First Additional Closing, on the date hereof (the “First Additional Closing Eligibility Date”), an Additional
Note in the original principal amount set forth opposite its name in column (2) on the Schedule of Additional Closings (the “First
Additional Note Amount”) and (B) with respect to the Second Additional Closing, on the twentieth (20th)
Trading Day after the date the Registration Statement (as defined in the Registration Rights Agreement) with respect to the resale of
all the Conversion Shares issuable upon conversion of the Initial Notes and the Additional Notes issued at the First Additional Closing
(without regards to any limitation on conversion set forth therein) is declared effective by the SEC (the “Second Additional
Closing Eligibility Date”, and tougher with the First Additional Closing Eligibility Date, each an “Additional Closing
Eligibility Date”), an Additional Note in the original principal amount not in excess of the amount set forth opposite its
name in column (3) on the Schedule of Additional Closings (the “Maximum Additional Note
Amount”).


 


(3)
       Additional Closing Mechanics. Subject to the satisfaction
of the conditions to closing set forth in this Section 1(b)(ii) and Sections 6(b) and 7(b) below, the Company may exercise its right
to require an Additional Closing by delivering at any time on or after the applicable Additional Closing Eligibility Date a written notice
thereof by e-mail and overnight courier to each Buyer (each, an “Additional Closing Notice”, and the date thereof,
each an “Additional Closing Notice Date”). Each Additional Closing Notice shall be irrevocable. Each Additional Closing
Notice shall (A) certify that the Additional Closing Eligibility Date with respect to such Additional Closing has been met and, other
than with respect to deliverables to be delivered to each Buyer at such Additional Closing, all the conditions to closing set forth in
this Section 1(b)(ii) and Sections 6(b) and 7(b) below have been satisfied in full as of such Additional Closing Notice Date, (B) specify
the proposed date of such Additional Closing (which shall be (x) the date hereof with respect to the First Additional Closing and no
less than five (5) Trading Days and no more than ten (10) Trading Days after such proposed Additional Closing Notice Date with respect
to the Second Additional Closing Date) and (C) specify the aggregate principal amount of Additional Notes to be purchased by each Buyer
at such Additional Closing; provided, however, that the Company may not require a Buyer to purchase (I) Additional Notes at the First
Additional Closing in excess of the applicable First Additional Note Amount or (II) Additional Notes at the Second Additional Closing
in excess of the applicable Maximum Additional Note Amount with respect to the Second Additional Closing (such aggregate principal amount
of Additional Notes set forth in such Additional Closing Notice to be purchased by such Buyer, each, an “Additional Note Amount”).
For the avoidance of doubt, the Company shall not be entitled to effect an Additional Closing if on the Additional Closing Date there
is an Equity Conditions Failure (as defined in the Initial Notes) on the Additional Closing Date. The Company’s rights to affect
any Additional Closings hereunder shall automatically terminate at 9:00 AM, New York city time on December 31, 2021 (or such other date
as the Company and the Holders shall mutually agree, the “Additional Closing Expiration Date”).


 


 


 






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(c)           Purchase
Price. The aggregate purchase price for the Initial Notes and the Warrants to be purchased by each Buyer (the “Initial Purchase
Price”) shall be the amount set forth opposite such Buyer’s name in column (5) on the Schedule of Buyers. The aggregate
purchase price for the Additional Notes to be purchased by each Buyer shall be $0.90 for each $1.00 of original principal amount of the
Additional Note to be purchased by such Buyer at the Additional Closing (such aggregate amount for such Buyer, the “Additional
Purchase Price”, and together with the Initial Purchase Price, each, a “Purchase Price”). The Buyers and
the Company agree that for purposes of applying Section 305 of the Internal Revenue Code of 1986, as amended (the “Code”),
the Company will apply Section 1273(c)(2) of the Code as if the Notes and the Warrants constitute an “investment unit” for
purposes of Section 1273(c)(2) of the Code. The parties agree that the Purchase Price shall be allocated between each Note and Warrant
in accordance with Section 1273(c)(2) of the Code and Treasury Regulation Section 1.1273-2(h) as mutually agreed to by the parties, and
none of the parties shall take any position inconsistent with such allocation in any tax return or in any judicial or administrative
proceeding in respect of taxes.


 


(d)          Form of Payment.




 


(i)   
On the Initial Closing Date, (i) each Buyer shall pay its respective Initial Purchase Price (less, in the case of any Buyer, the
amounts withheld pursuant to Section 4(g)) to the Company for the Initial Notes and the Warrants to be issued and sold to such Buyer at
the Closing, by wire transfer of immediately available funds in accordance with the Initial Flow of Funds Letter (as defined below) and
(ii) the Company shall deliver to each Buyer (A) an Initial Note in the aggregate original principal amount as is set forth opposite such
Buyer’s name in column (3) of the Schedule of Buyers, and (B) a Warrant pursuant to which such Buyer shall have the right to initially
acquire up to such aggregate number of Warrant Shares as is set forth opposite such Buyer’s name in column (4) of the Schedule of
Buyers, in each case, duly executed on behalf of the Company and registered in the name of such Buyer or its designee.


 


(ii)   
On each Additional Closing Date, (i) each Buyer shall pay its respective Additional Purchase Price (less, in the case of any Buyer,
the amounts withheld pursuant to Section 4(g)) to the Company for the Additional Notes to be issued and sold to such Buyer at the Closing,
by wire transfer of immediately available funds in accordance with the applicable Additional Flow of Funds Letter (as defined below) and
(ii) the Company shall deliver to each Buyer (A) an Additional Note in the applicable Additional Note Amount being purchased by such Buyer
at such Additional Closing duly executed on behalf of the Company and registered in the name of such Buyer or its designee.


 


		2.	BUYER’S REPRESENTATIONS AND WARRANTIES.



 


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


 


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


 


 


 






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


 


(c)          Accredited
Investor Status. Such Buyer is an “accredited investor” as that term is defined in Rule 501(a) of Regulation D.


 


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


 


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


 


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


 


 


 






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


 


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


 


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


 


 


 






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		3.	REPRESENTATIONS AND WARRANTIES OF THE COMPANY.



 


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


 


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


 


(b)         Authorization;
Enforcement; Validity. The Company has the requisite power and authority to enter into and perform its obligations under this Agreement
and the other Transaction Documents and to issue the Securities in accordance with the terms hereof and thereof. Each Subsidiary has
the requisite power and authority to enter into and perform its obligations under the Transaction Documents to which it is a party. The
execution and delivery of this Agreement and the other Transaction Documents by the Company and its Subsidiaries, and the consummation
by the Company and its Subsidiaries of the transactions contemplated hereby and thereby (including, without limitation, the issuance
of the Notes and the reservation for issuance and issuance of the Conversion Shares issuable upon conversion of the Notes and the issuance
of the Warrants and the reservation for issuance and issuance of the Warrant Shares issuable upon exercise of the Warrants) have been
duly authorized by the Company’s board of directors and each of its Subsidiaries’ board of directors or other governing body,
as applicable, and (other than the filing with the SEC of one or more Registration Statements in accordance with the requirements of
the Registration Rights Agreement, a Form D with the SEC and any other filings as may be required by any state securities agencies) no
further filing, consent or authorization is required by the Company, its Subsidiaries, their respective boards of directors or their
shareholders or other governing body. This Agreement has been, and the other Transaction Documents to which it is a party will be prior
to such Closing, duly executed and delivered by the Company, and each constitutes the legal, valid and binding obligations of the Company,
enforceable against the Company in accordance with its respective terms, except as such enforceability may be limited by general principles
of equity or applicable bankruptcy, insolvency, reorganization, moratorium, liquidation or similar laws relating to, or affecting generally,
the enforcement of applicable creditors’ rights and remedies and except as rights to indemnification and to contribution may be
limited by federal or state securities law. Prior to such Closing, the Transaction Documents to which each Subsidiary is a party will
be duly executed and delivered by each such Subsidiary, and shall constitute the legal, valid and binding obligations of each such Subsidiary,
enforceable against each such Subsidiary in accordance with their respective terms, except as such enforceability may be limited by general
principles of equity or applicable bankruptcy, insolvency, reorganization, moratorium, liquidation or similar laws relating to, or affecting
generally, the enforcement of applicable creditors’ rights and remedies and except as rights to indemnification and to contribution
may be limited by federal or state securities law. “Transaction Documents” means, collectively, this Agreement, the
Notes, the Warrants, the Guaranties, the Security Documents, the Registration Rights Agreement, the Irrevocable Transfer Agent Instructions
(as defined below) and each of the other agreements and instruments entered into or delivered by any of the parties hereto in connection
with the transactions contemplated hereby and thereby, as may be amended from time to time.


 


 


 


 






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(c)          Issuance
of Securities. The issuance of the Notes and the Warrants are duly authorized and upon issuance in accordance with the terms of the
Transaction Documents shall be validly issued, fully paid and non-assessable and free from all preemptive or similar rights, mortgages,
defects, claims, liens, pledges, charges, taxes, rights of first refusal, encumbrances, security interests and other encumbrances (collectively
“Liens”) with respect to the issuance thereof. As of such Closing, the Company shall have reserved from its duly authorized
capital stock not less than the sum of (i) 300% of the maximum number of Conversion Shares issuable upon conversion of the Notes (assuming
for purposes hereof that (x) the Notes are convertible at the initial Alternate Conversion Price (as defined in the Notes) assuming an
Alternate Conversion Price (as defined in the Notes) as of the date hereof, and (y) any such conversion shall not take into account any
limitations on the conversion of the Notes set forth in the Notes), and (ii) 100% of the maximum number of Warrant Shares initially issuable
upon exercise of the Warrants (without taking into account any limitations on the exercise of the Warrants set forth therein). Upon issuance
or conversion in accordance with the Notes or exercise in accordance with the Warrants (as the case may be), the Conversion Shares and
the Warrant Shares, respectively, when issued, will be validly issued, fully paid and nonassessable and free from all preemptive or similar
rights or Liens with respect to the issue thereof, with the holders being entitled to all rights accorded to a holder of Common Stock.
Subject to the accuracy of the representations and warranties of the Buyers in this Agreement, the offer and issuance by the Company
of the Securities is exempt from registration under the 1933 Act.


 


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


 


 


 


 






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


 


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


 


 


 


 






    	 	9	 



     

    

 


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


 


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


 


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


 


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


 


 


 


 


 






    	 	10	 



     

    

 


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


 


 


 


 


 






    	 	11	 



     

    




 


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


 


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


 


 


 


 


 






    	 	12	 



     

    

 


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


 


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


 


 


 


 






    	 	13	 



     

    

 


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


 


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


 


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


 


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


 


(r)           Equity Capitalization.




 


(i)   
Definitions:


 


(A)            “Common Stock” means (x) the Company’s shares of common stock, $0.0001 par value per share, and (y) any
capital stock into which such common stock shall have been changed or any share capital resulting from a reclassification of such common
stock.


 


(B)             “Preferred Stock” means (x) the Company’s blank check preferred stock, $0.0001 par value per share, the
terms of which may be designated by the board of directors of the Company in a certificate of designations and (y) any capital


stock into which such preferred stock
shall have been changed or any share capital resulting from a reclassification of such preferred stock (other than a conversion of such
preferred stock into Common Stock in accordance with the terms of such certificate of designations).


 


 


 


 


 






    	 	14	 



     

    

 


(ii)   
Authorized and Outstanding Capital Stock. As of the date hereof, the authorized capital stock of the Company consists of
(A) 900,000,000 shares of Common Stock, of which, 135,237,584 are issued and outstanding and no shares are reserved for
issuance pursuant to Convertible Securities (as defined below) (other than the Notes and the Warrants) exercisable or exchangeable for,
or convertible into, shares of Common Stock and (B) 100,000 shares of Preferred Stock, none of which are issued and outstanding. 764,762,416
shares of Common Stock are held in the treasury of the Company.


 


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


 


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


 


 


 


 






    	 	15	 



     

    

 


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


 


(s)          Indebtedness
and Other Contracts. Neither the Company nor any of its Subsidiaries, (i) except as disclosed on Schedule 3(s) has any
outstanding debt securities, notes, credit agreements, credit facilities or other agreements, documents or instruments evidencing
Indebtedness of the Company or any of its Subsidiaries or by which the Company or any of its Subsidiaries is or may become bound,
(ii) is a party to any contract, agreement or instrument, the violation of which, or default under which, by the other party(ies) to
such contract, agreement or instrument could reasonably be expected to result in a Material Adverse Effect, (iii) has any financing
statements securing obligations in any amounts filed in connection with the Company or any of its Subsidiaries; (iv) is in violation
of any term of, or in default under, any contract, agreement or instrument relating to any Indebtedness, except where such
violations and defaults would not result, individually or in the aggregate, in a Material Adverse Effect, or (v) is a party to any
contract, agreement or instrument relating to any Indebtedness, the performance of which, in the judgment of the Company’s
officers, has or is expected to have a Material Adverse Effect. Neither the Company nor any of its Subsidiaries have any liabilities
or obligations required to be disclosed in the SEC Documents which are not so disclosed in the SEC Documents, other than those
incurred in the ordinary course of the Company’s or its Subsidiaries’ respective businesses and which, individually or
in the aggregate, do not or could not have a Material Adverse Effect. For purposes of this Agreement: (x)
“Indebtedness” of any Person means, without duplication (A) all indebtedness for borrowed money, (B) all
obligations issued, undertaken or assumed as the deferred purchase price of property or services (including, without limitation,
“capital leases” in accordance with GAAP) (other than trade payables entered into in the ordinary course of business
consistent with past practice), (C) all reimbursement or payment obligations with respect to letters of credit, surety bonds and
other similar instruments, (D) all obligations evidenced by notes, bonds, debentures or similar instruments, including obligations
so evidenced incurred in connection with the acquisition of property, assets or businesses, (E) all indebtedness created or arising
under any conditional sale or other title retention agreement, or incurred as financing, in either case with respect to any property
or assets acquired with the proceeds of such indebtedness (even though the rights and remedies of the seller or bank under such
agreement in the event of default are limited to repossession or sale of such property), (F) all monetary obligations under any
leasing or similar arrangement which, in connection with GAAP, consistently applied for the periods covered thereby, is classified
as a capital lease, (G) all indebtedness referred to in clauses (A) through (F) above secured by (or for which the holder of such
Indebtedness has an existing right, contingent or otherwise, to be secured by) any Lien upon or in any property or assets (including
accounts and contract rights) owned by any Person, even though the Person which owns such assets or property has not assumed or
become liable for the payment of such indebtedness, and (H) all Contingent Obligations in respect of indebtedness or obligations of
others of the kinds referred to in clauses (A)  through
(G) above; and (y) “Contingent Obligation” means, as to any Person, any direct or indirect liability, contingent
or otherwise, of that Person with respect to any Indebtedness, lease, dividend or other obligation of another Person if the primary
purpose or intent of the Person incurring such liability, or the primary effect thereof, is to provide assurance to the obligee of
such liability that such liability will be paid or discharged, or that any agreements relating thereto will be complied with, or
that the holders of such liability will be protected (in whole or in part) against loss with respect thereto.


 


 


 






    	 	16	 



     

    

 


(t)           Litigation.
There is no action, suit, arbitration, proceeding, inquiry or investigation before or by the Principal Market, any court, public board,
other Governmental Entity, self- regulatory organization or body pending or, to the knowledge of the Company, threatened against or affecting
the Company or any of its Subsidiaries, the Common Stock or any of the Company’s or its Subsidiaries’ officers or directors,
whether of a civil or criminal nature or otherwise, in their capacities as such, except as set forth in Schedule 3(t). No director,
officer or employee of the Company or any of its subsidiaries has willfully violated 18 U.S.C. §1519 or engaged in spoliation in
reasonable anticipation of litigation. Without limitation of the foregoing, there has not been, and to the knowledge of the Company,
there is not pending or contemplated, any investigation by the SEC involving the Company, any of its Subsidiaries or any current or former
director or officer of the Company or any of its Subsidiaries. The SEC has not issued any stop order or other order suspending the effectiveness
of any registration statement filed by the Company under the 1933 Act or the 1934 Act. After reasonable inquiry of its employees, the
Company is not aware of any fact which might result in or form the basis for any such action, suit, arbitration, investigation, inquiry
or other proceeding. Neither the Company nor any of its Subsidiaries is subject to any order, writ, judgment, injunction, decree, determination
or award of any Governmental Entity.


 


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


 


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


 


 


 


 






    	 	17	 



     

    

 


(w)          Title.




 


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


 


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


 


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


 


 


 


 


 






    	 	18	 



     

    

 


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


 


(ii)              
No Hazardous Materials:


 


(A)   
have been disposed of or otherwise released from any Real Property of the Company or any of its Subsidiaries in violation of any
Environmental Laws; or


 


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


 


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


 


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


 


 


 






    	 	19	 



     

    

 


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


 


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


 


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


 


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


 


 


 


 






    	 	20	 



     

    

 


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


 


(ee)        Acknowledgement
Regarding Buyers’ Trading Activity. It is understood and acknowledged by the Company that (i) following the public disclosure
of the transactions contemplated by the Transaction Documents, in accordance with the terms thereof, none of the Buyers have been asked
by the Company or any of its Subsidiaries to agree, nor has any Buyer agreed with the Company or any of its Subsidiaries, to desist from
effecting any transactions in or with respect to (including, without limitation, purchasing or selling, long and/or short) any securities
of the Company, or “derivative” securities based on securities issued by the Company or to hold any of the Securities for
any specified term; (ii) any Buyer, and counterparties in “derivative” transactions to which any such Buyer is a party, directly
or indirectly, presently may have a “short” position in the Common Stock which was established prior to such Buyer’s
knowledge of the transactions contemplated by the Transaction Documents; (iii) each Buyer shall not be deemed to have any affiliation
with or control over any arm’s length counterparty in any “derivative” transaction; and (iv) each Buyer may rely on
the Company’s obligation to timely deliver shares of Common Stock upon conversion, exercise or exchange, as applicable, of the Securities
as and when required pursuant to the Transaction Documents for purposes of effecting trading in the Common Stock of the Company. The Company
further understands and acknowledges that following the public disclosure of the transactions contemplated by the Transaction Documents
pursuant to the Initial Press Release, the Additional Press Release, the Initial 8-K Filing and/or the Additional 8-K Filing, as applicable,
one or more Buyers may engage in hedging and/or trading activities (including, without limitation, the location and/or reservation of
borrowable shares of Common Stock) at various times during the period that the Securities are outstanding, including, without limitation,
during the periods that the value and/or number of the Warrant Shares or Conversion Shares, as applicable, deliverable with respect to
the Securities are being determined and such hedging and/or trading activities (including, without limitation, the location and/or reservation
of borrowable shares of Common Stock), if any, can reduce the value of the existing shareholders’ equity interest in the Company
both at and after the time the hedging and/or trading activities are being conducted. The Company acknowledges that such aforementioned
hedging and/or trading activities do not constitute a breach of this Agreement, the Notes, the Warrants or any other Transaction Document
or any of the documents executed in connection herewith or therewith.


 


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


 


 


 


 


 






    	 	21	 



     

    

 


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


 


(hh)       Registration
Eligibility. The Company is eligible to register the Registrable Securities (as defined in the Registration Rights Agreement) for
resale by the Buyers using Form S-3 promulgated under the 1933 Act.


 


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


 


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


 


(kk)         Shell
Company Status. The Company is not, and has never been, an issuer identified in, or subject to, Rule 144(i).


 


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


 


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


 


 


 


 


 


 






    	 	22	 



     

    

 


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


 


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


 


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


 


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


 


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


 


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




 


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


 


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


 


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


 


 


 


 






    	 	23	 



     

    

 


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


 


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


 


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


 


(qq)       No
Disqualification Events. With respect to Securities to be offered and sold hereunder in reliance on Rule 506(b) under the 1933 Act
(“Regulation D Securities”), none of the Company, any of its predecessors, any affiliated issuer, any director, executive
officer, other officer of the Company participating in the offering contemplated hereby, any beneficial owner of 20% or more of the Company’s
outstanding voting equity securities, calculated on the basis of voting power, nor any promoter (as that term is defined in Rule 405 under
the 1933 Act) connected with the Company in any capacity at the time of sale (each, an “Issuer Covered Person” and,
together, “Issuer Covered Persons”) is subject to any of the “Bad Actor” disqualifications described in
Rule 506(d)(1)(i) to (viii) under the 1933 Act (a “Disqualification Event”), except for a Disqualification Event covered
by Rule 506(d)(2) or (d)(3). The Company has exercised reasonable care to determine whether any Issuer Covered Person is subject to a
Disqualification Event. The Company has complied, to the extent applicable, with its disclosure obligations under Rule 506(e), and has
furnished to the Buyers a copy of any disclosures provided thereunder.


 


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


 


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


 


 


 


 


 


 






    	 	24	 



     

    

 


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


 


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


 


(x)         
Ranking of Notes. No Indebtedness of the Company, as of any Closing, will be senior to, or pari passu with, the Notes
in right of payment, whether with respect to payment or redemptions, interest, damages, upon liquidation or dissolution or otherwise.


 


(ww)       Potential Products; FDA; EMEA.


 


(i)   
The Company and its Subsidiaries possess all certificates, authorizations and permits issued by the appropriate federal, state
or foreign regulatory authorities necessary to conduct its business as currently conducted, including without limitation all such certificates,
authorizations and permits required by the United States Food and Drug Administration (the “FDA”) or any other federal,
state or foreign agencies or bodies engaged in the regulation of pharmaceuticals or biohazardous materials, except where the failure to
so possess such certificates, authorizations and permits, individually or in the aggregate, would not result in a Material Adverse Effect.
Neither the Company nor any of its Subsidiaries have received any notice of proceedings relating to the revocation or modification of
any such certificate, authorization or permit which, individually or in the aggregate, if the subject of an unfavorable decision, ruling
or finding, would have a Material Adverse Effect.


 


(ii)    Neither
the Company nor any of its Subsidiaries have received any written notices or statements from the FDA, the European Medicines Agency
(the “EMEA”) or any other governmental agency, and otherwise has no knowledge or reason to believe, that (i) any
drug candidate of the Company or any of its Subsidiaries (each a “Potential Product”) may or will be rejected or
determined to be non-approvable; (ii) a delay in time for review and/or approval of a marketing authorization application or
marketing approval application in any jurisdiction for any Potential Product is or may be required, requested or being implemented;
(iii) one or more clinical studies for any Potential Product shall or may be requested or required in addition to the clinical
studies submitted to the FDA prior to the date hereof as a precondition to or condition of issuance or maintenance of a marketing
approval for any Potential Product; (iv) any license, approval, permit or authorization to conduct any clinical trial of or market
any product or Potential Product of the Company or any of its Subsidiaries has been, will be or may be suspended, revoked, modified
or limited, except in the cases of clauses (i), (ii), (iii) and (iv) where such rejections, determinations, delays, requests,
suspensions, revocations, modifications or limitations might not reasonably be expected to have, individually or in the aggregate, a
Material Adverse Effect.


 


 


 


 


 






    	 	25	 



     

    

 


(iii) To
the Company’s and its Subsidiaries’ knowledge, the preclinical and clinical testing, application for marketing approval
of, manufacture, distribution, promotion and sale of the products and Potential Products of the Company and/or any of its
Subsidiaries are in compliance, in all material respects, with all laws, rules and regulations applicable to such activities,
including without limitation applicable good laboratory practices, good clinical practices and good manufacturing practices, except
for such non-compliance as would not, individually or in the aggregate, have a Material Adverse Effect. The descriptions of the
results of such tests and trials contained in Schedule 3(ww) are complete and accurate in all material respects such that there
would be no untrue statement of a material fact or omission of a material fact necessary to make the statements in Schedule 3(ww),
in light of the circumstances under which they are made, not misleading. Neither the Company nor any of its Subsidiaries is aware of
any studies, tests or trial the results of which reasonably call into question the results of the tests and trials conducted by or
on behalf of the Company or any of its Subsidiaries that are described or referred to in Schedule 3(ww). Neither the Company nor any
of its Subsidiaries received notice of adverse finding, warning letter or clinical hold notice from the FDA or any non-U.S.
counterpart of any of the foregoing, or any untitled letter or other correspondence or notice from the FDA or any other governmental
authority or agency or any institutional or ethical review board alleging or asserting noncompliance with any law, rule or
regulation applicable in any jurisdiction, except notices, letters, and correspondences and non-U.S. counterparts thereof alleging
or asserting such noncompliance as would not, individually or in the aggregate, have a Material Adverse Effect. Neither the Company
nor any of its Subsidiaries has, either voluntarily or involuntarily, initiated, conducted or issued, or caused to be initiated,
conducted or issued, any recall, field correction, market withdrawal or replacement, safety alert, warning, “dear
doctor” letter, investigator notice, or other notice or action relating to an alleged or potential lack of safety or efficacy
of any product or Potential Product of the Company or any of its Subsidiaries, any alleged product defect of any product or
Potential Product of the Company or any of its Subsidiaries, or any violation of any material applicable law, rule, regulation or
any clinical trial or marketing license, approval, permit or authorization for any product or potential product of the Company or
any of its Subsidiaries, and neither the Company nor any of its Subsidiaries is aware of any facts or information that would cause
it to initiate any such notice or action and has no knowledge or reason to believe that the FDA, the EMEA or any other governmental
agency or authority or any institutional or ethical review board or other non- governmental authority intends to impose, require,
request or suggest such notice or action.


 


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


 


 


 






    	 	26	 



     

    

 


 


		4.	COVENANTS.



 


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


 


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


  


(c)          Reporting
Status. Until the date on which the Buyers shall have sold all of the Registrable Securities (the “Reporting
Period”), the Company shall timely file all reports required to be filed with the SEC pursuant to the 1934 Act, and the
Company shall not terminate its status as an issuer required to file reports under the 1934 Act even if the 1934 Act or the rules
and regulations thereunder would no longer require or otherwise permit such termination. From the time Form S-3 is available to the
Company for the registration of the Registrable Securities, the Company shall take all actions necessary to maintain its eligibility
to register the Registrable Securities for resale by the Buyers on Form S-3.


 


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


 


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


 


(f)           Listing. The Company shall promptly secure the listing or designation for quotation (as the case may be) of all of the Registrable
Securities upon each national securities exchange and automated quotation system, if any, upon which the Common Stock is then listed or
designated for quotation (as the case may be) (subject to official notice of issuance) and shall maintain such listing or designation
for quotation (as the case may be) of all Registrable Securities from time to time issuable under the terms of the Transaction Documents
on such national securities exchange or automated quotation system. The Company shall maintain the Common Stock’s listing or authorization
for quotation (as the case may be) on the Principal Market, The New York Stock Exchange, the NYSE American, the Nasdaq Capital Market,
the Nasdaq Global Market or the Nasdaq Global Select Market (each, an “Eligible Market”). Neither the Company nor any
of its Subsidiaries shall take any action which could be reasonably expected to result in the delisting or suspension of the Common Stock
on an Eligible Market. The Company shall pay all fees and expenses in connection with satisfying its obligations under this Section 4(f).


 


 


 


 






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(g)               Fees.
The Company shall reimburse the lead Buyer for all costs and expenses incurred by it or its affiliates in connection with the
structuring, documentation, negotiation and closing of the transactions contemplated by the Transaction Documents (including,
without limitation, as applicable, all reasonable legal fees of outside counsel and disbursements of Kelley Drye & Warren LLP,
counsel to the lead Buyer, any other reasonable fees and expenses in connection with the structuring, documentation, negotiation and
closing of the transactions contemplated by the Transaction Documents and due diligence and regulatory filings in connection
therewith) (the “Transaction Expenses”) and shall be withheld by the lead Buyer from its Purchase Price at the
Initial Closing (or, if incurred after the Initial Closing, at an Additional Closing as requested by Kelley Drye & Warren LLP),
less $5,000.00 previously paid by the Company to Kelley Drye & Warren LLP; provided, that the Company shall promptly
reimburse Kelley Drye & Warren LLP on demand for all Transaction Expenses not so reimbursed through such withholding at a
Closing. The Company shall be responsible for the payment of any placement agent’s fees, financial advisory fees, transfer
agent fees, DTC (as defined below) fees or broker’s commissions (other than for Persons engaged by any Buyer) relating to or
arising out of the transactions contemplated hereby (including, without limitation, any fees or commissions payable to the Placement
Agent, who is the Company’s sole placement agent in connection with the transactions contemplated by this Agreement). The
Company shall pay, and hold each Buyer harmless against, any liability, loss or expense (including, without limitation, reasonable
attorneys’ fees and out-of-pocket expenses) arising in connection with any claim relating to any such payment. Except as
otherwise set forth in the Transaction Documents, each party to this Agreement shall bear its own expenses in connection with the
sale of the Securities to the Buyers.


 


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


 


		(i)	Disclosure of Transactions and Other Material Information.



 


(i)   
Disclosure of Transaction.


 


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


 


 


 


 


 


 






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(2)            Additional Closings. The Company shall, on or before 8:30 a.m., New York time, on the first (1st) Business Day after the
Company delivers an Additional Closing Notice to any Buyer, either issue a press release (each, an “Additional Press Release”)
or file a Current Report on Form 8-K (each, an “Additional 8-K Filing”), in each case reasonably acceptable to the
Required Holders, disclosing that the Company has elected to deliver an Additional Closing Notice to the Buyers. From and after the filing
of the Additional Press Release or Additional 8-K Filing, the Company shall have disclosed all material, non-public information (if any)
provided to the Buyers by the Company or any of its Subsidiaries or any of their respective officers, directors, employees or agents in
connection with the transactions contemplated by the Transaction Documents. In addition, effective upon the filing of the Additional Press
Release or Additional 8- K Filing, the Company acknowledges and agrees that any and all confidentiality or similar obligations under any
agreement, whether written or oral, between the Company, any of its Subsidiaries or any of their respective officers, directors, affiliates,
employees or agents, on the one hand, and any of the Buyers or any of their affiliates, on the other hand, shall terminate.


 


(ii)    Limitations
on Disclosure. Except with respect to the delivery of an Additional Closing Notice in accordance with Section 1(b)(ii), the
Company shall not, and the Company shall cause each of its Subsidiaries and each of its and their respective officers, directors,
employees and agents not to, provide any Buyer with any material, non- public information regarding the Company or any of its
Subsidiaries from and after the date hereof without the express prior written consent of such Buyer (which may be granted or
withheld in such Buyer’s sole discretion). In the event of a breach of any of the foregoing covenants, or any of the covenants
or agreements contained in any other Transaction Document, by the Company, any of its Subsidiaries, or any of its or their
respective officers, directors, employees and agents (as determined in the reasonable good faith judgment of such Buyer), in
addition to any other remedy provided herein or in the Transaction Documents, such Buyer shall have the right to make a public
disclosure, in the form of a press release, public advertisement or otherwise, of such breach or such material, non-public
information, as applicable, without the prior approval by the Company, any of its Subsidiaries, or any of its or their respective
officers, directors, employees or agents. No Buyer shall have any liability to the Company, any of its Subsidiaries, or any of its
or their respective officers, directors, employees, affiliates, shareholders or agents, for any such disclosure. To the extent that
the Company delivers any material, non-public information to a Buyer without such Buyer’s consent, the Company hereby
covenants and agrees that such Buyer shall not have any duty of confidentiality with respect to, or a duty not to trade on the basis
of, such material, non-public information. Subject to the foregoing, neither the Company, its Subsidiaries nor any Buyer shall issue
any press releases or any other public statements with respect to the transactions contemplated hereby; provided, however, the
Company shall be entitled, without the prior approval of any Buyer, to make the Press Release and any press release or other public
disclosure with respect to such transactions (i) in substantial conformity with the Initial 8-K Filing and contemporaneously
therewith and (ii) as is required by applicable law and regulations (provided that in the case of clause (i) each Buyer shall be
consulted by the Company in connection with any such press release or other public disclosure prior to its release). Without the
prior written consent of the applicable Buyer (which may be granted or withheld in such Buyer’s sole discretion), the Company
shall not (and shall cause each of its Subsidiaries and affiliates to not) disclose the name of such Buyer in any filing,
announcement, release or otherwise. Notwithstanding anything contained in this Agreement to the contrary and without implication
that the contrary would otherwise be true, the Company expressly acknowledges and agrees that no Buyer shall have (unless expressly
agreed to by a particular Buyer after the date hereof in a written definitive and binding agreement executed by the Company and such
particular Buyer (it being understood and agreed that no Buyer may bind any other Buyer with respect thereto)), any duty of
confidentiality with respect to, or a duty not to trade on the basis of, any material, non-public information regarding the Company
or any of its Subsidiaries.


 


 


 


 


 






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(iii)    Other
Confidential Information. Disclosure Failures; Disclosure Delay Payments. In addition to other remedies set forth in this
Section 4(i), and without limiting anything set forth in any other Transaction Document, at any time after each Closing Date if the
Company, any of its Subsidiaries, or any of their respective officers, directors, employees or agents, provides any Buyer with
material non-public information relating to the Company or any of its Subsidiaries (each, the “Confidential
Information”), the Company shall, on or prior to the applicable Required Disclosure Date (as defined below), publicly
disclose such Confidential Information on a Current Report on Form 8-K or otherwise (each, a “Disclosure”). From
and after such Disclosure, the Company shall have disclosed all Confidential Information provided to such Buyer by the Company or
any of its Subsidiaries or any of their respective officers, directors, employees or agents in connection with the transactions
contemplated by the Transaction Documents. In addition, effective upon such Disclosure, the Company acknowledges and agrees that any
and all confidentiality or similar obligations under any agreement, whether written or oral, between the Company, any of its
Subsidiaries or any of their respective officers, directors, affiliates, employees or agents, on the one hand, and any of the Buyers
or any of their affiliates, on the other hand, shall terminate. In the event that the Company fails to effect such Disclosure on or
prior to the Required Disclosure Date and such Buyer shall have possessed Confidential Information for at least ten (10) consecutive
Trading Days (each, a “Disclosure Failure”), then, as partial relief for the damages to such Buyer by reason of
any such delay in, or reduction of, its ability to buy or sell shares of Common Stock after such Required Disclosure Date (which
remedy shall not be exclusive of any other remedies available at law or in equity), the Company shall pay to such Buyer an amount in
cash equal to the greater of (I) two percent (2%) of the aggregate Purchase Price and (II) the applicable Disclosure Restitution
Amount, on each of the following dates (each, a “Disclosure Delay Payment Date”): (i) on the date of such
Disclosure Failure and (ii) on every thirty (30) day anniversary such Disclosure Failure until the earlier of (x) the date such
Disclosure Failure is cured and (y) such time as all such non-public information provided to such Buyer shall cease to be
Confidential Information (as evidenced by a certificate, duly executed by an authorized officer of the Company to the foregoing
effect) (such earlier date, as applicable, a “Disclosure Cure Date”). Following the initial Disclosure Delay
Payment for any particular Disclosure Failure, without limiting the foregoing, if a Disclosure Cure Date occurs prior to any thirty
(30) day anniversary of such Disclosure Failure, then such Disclosure Delay Payment (prorated for such partial month) shall be made
on the second (2nd) Business Day after such Disclosure Cure Date. The payments to which an Investor shall be entitled pursuant to
this Section 4(i)(iii) are referred to herein as “Disclosure Delay Payments.” In the event the Company fails to
make Disclosure Delay Payments in a timely manner in accordance with the foregoing, such Disclosure Delay Payments shall bear
interest at the rate of two percent (2%) per month (prorated for partial months) until paid in full.


 


		(iv)	For the purpose of this Agreement the following definitions shall
apply:



 


(1)        “Disclosure
Failure Market Price” means, as of any Disclosure Delay Payment Date, the price computed as the quotient of (I) the sum of
the five (5)   highest VWAPs (as defined in the Warrants)
of the Common Stock during the applicable Disclosure Restitution Period (as defined below), divided by (II) five (5) (such period,
the “Disclosure Failure Measuring Period”). All such determinations to be appropriately adjusted for any share
dividend, share split, share combination, reclassification or similar transaction that proportionately decreases or increases the
Common Stock during such Disclosure Failure Measuring Period.


 


(2)   
    “Disclosure Restitution Amount” means, as of any Disclosure Delay Payment Date, the product of (x) difference
of (I) the Disclosure Failure Market Price less (II) the lowest purchase price, per share of Common Stock, of any Common Stock issued
or issuable to such Buyer pursuant to this Agreement or any other Transaction Documents, multiplied by (y) 10% of the aggregate daily
dollar trading volume (as reported on Bloomberg (as defined in the Warrants)) of the Common Stock on the Principal Market for each Trading
Day (as defined in the Warrants) either (1) with respect to the initial Disclosure Delay Payment Date, during the period commencing on
the applicable Required Disclosure Date through and including the Trading Day immediately prior to the initial Disclosure Delay Payment
Date or (2) with respect to each other Disclosure Delay Payment Date, during the period commencing the immediately preceding Disclosure
Delay Payment Date through and including the Trading Day immediately prior to such applicable Disclosure Delay Payment Date (such applicable
period, the “Disclosure Restitution Period”).


 


 


 


 


 






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(3)    “Required
Disclosure Date” means (x) if such Buyer authorized the delivery of such Confidential Information, either (I) if the
Company and such Buyer have mutually agreed upon a date (as evidenced by an e-mail or other writing) of Disclosure of such
Confidential Information, such agreed upon date or (II) otherwise, the seventh (7th)
calendar day after the date such Buyer first received any Confidential Information or (y) if such Buyer did not authorize the
delivery of such Confidential Information, the first (1st) Business Day after such
Buyer’s receipt of such Confidential Information.


 


(j)           Additional Registration Statements. Until the Applicable Date (as defined below) and at any time thereafter while any Registration
Statement is not effective or the prospectus contained therein is not available for use or any Current Public Information Failure (as
defined in the Registration Rights Agreement) exists, the Company shall not file a registration statement or an offering statement under
the 1933 Act relating to securities that are not the Registrable Securities (other than a registration statement on Form S-8 or such supplements
or amendments to registration statements that are outstanding and have been declared effective by the SEC as of the date hereof (solely
to the extent necessary to keep such registration statements effective and available and not with respect to any Subsequent Placement)).
“Applicable Date” means the earlier of (x) the first date on which the resale by the Buyers of all the Registrable
Securities required to be filed on the initial Registration Statement (as defined in the Registration Rights Agreement) pursuant to the
Registration Rights Agreement is declared effective by the SEC (and each prospectus contained therein is available for use on such date)
or (y) the first date on which all of the Registrable Securities are eligible to be resold by the Buyers pursuant to Rule 144 (or, if
a Current Public Information Failure has occurred and is continuing, such later date after which the Company has cured such Current Public
Information Failure).


 


(k)          Additional
Issuance of Securities. So long as any Buyer beneficially owns any Securities, the Company will not, without the prior written
consent of the Required Holders, issue any Notes (other than to the Buyers as contemplated hereby) and the Company shall not issue
any other securities that would cause a breach or default under the Notes or the Warrants. The Company agrees that for the period
commencing on the date hereof and ending on the date immediately following the 90th Trading Day after the Applicable Date (provided
that such period shall be extended by the number of calendar days during such period and any extension thereof contemplated by this
proviso on which any Registration Statement is not effective or any prospectus contained therein is not available for use or any
Current Public Information Failure exists) (the “Restricted Period”), neither the Company nor any of its
Subsidiaries shall directly or indirectly issue, offer, sell, grant any option or right to purchase, or otherwise dispose of (or
announce any issuance, offer, sale, grant of any option or right to purchase or other disposition of) any equity security or any
equity-linked or related security (including, without limitation, any “equity security” (as that term is defined under
Rule 405 promulgated under the 1933 Act), any Convertible Securities (as defined below), any debt, any preferred stock or any
purchase rights) (any such issuance, offer, sale, grant, disposition or announcement (whether occurring during the Restricted Period
or at any time thereafter) is referred to as a “Subsequent Placement”). Notwithstanding the foregoing, this
Section 4(k) shall not apply in respect of the issuance of (i) shares of Common Stock or standard options to purchase Common Stock
to directors, officers or employees of the Company in their capacity as such pursuant to an Approved Stock Plan (as defined below),
provided that (1) all such issuances (taking into account the shares of Common Stock issuable upon exercise of such options) after
the date hereof pursuant to this clause (i) do not, in the aggregate, exceed more than 5% of the Common Stock issued and outstanding
immediately prior to the date hereof and (2) the exercise price of any such options is not lowered, none of such options are amended
to increase the number of shares issuable thereunder and none of the terms or conditions of any such options are otherwise
materially changed in any manner that adversely affects any of the Buyers; (ii) shares of Common Stock issued upon the conversion or
exercise of Convertible Securities (other than standard options to purchase Common Stock issued pursuant to an Approved Stock Plan
that are covered by clause (i) above) issued prior to the date hereof, provided that the conversion, exercise or other method of
issuance (as the case may be) of any such Convertible Security is made solely pursuant to the conversion, exercise or other method
of issuance (as the case may be) provisions of such Convertible Security that were in effect on the date immediately prior to the
date of this Agreement, the conversion, exercise or issuance price of any such Convertible Securities (other than standard options
to purchase Common Stock issued pursuant to an Approved Stock Plan that are covered by clause (i) above) is not lowered, none of
such Convertible Securities (other than standard options to purchase Common Stock issued pursuant to an Approved Stock Plan that are
covered by clause (i) above) are amended to increase the number of shares issuable thereunder and none of the terms or conditions of
any such Convertible Securities (other than standard options to purchase Common Stock issued pursuant to an Approved Stock Plan that
are covered by clause (i) above) are otherwise materially changed in any manner that adversely affects any of the Buyers; (iii) the
Conversion Shares, and (iv) the Warrant Shares (each of the foregoing in clauses (i) through (iv), collectively the
“Excluded Securities”). “Approved Stock Plan” means any employee benefit plan which has been
approved by the board of directors of the Company prior to or subsequent to the date hereof pursuant to which shares of Common Stock
and standard options to purchase Common Stock may be issued to any employee, officer or director for services provided to the
Company in their capacity as such. “Convertible Securities” means any capital stock or other security of the
Company or any of its Subsidiaries that is at any time and under any circumstances directly or indirectly convertible into,
exercisable or exchangeable for, or which otherwise entitles the holder thereof to acquire, any capital stock or other security of
the Company (including, without limitation, Common Stock) or any of its Subsidiaries.


 


 


 


 


 






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(l)            Reservation
of Shares. So long as any of the Notes or Warrants remain outstanding, the Company shall take all action necessary to at all
times have authorized, and reserved for the purpose of issuance, no less than (i) 300% of the maximum number of shares of Common
Stock issuable upon conversion of all the Notes then outstanding (assuming for purposes hereof that (x) the Notes are convertible at
the Alternate Conversion Price assuming an Alternate Conversion Price as of such time of determination, and (y) any such conversion
shall not take into account any limitations on the conversion of the Notes set forth in the Notes), and (ii) 100% of the maximum
number of Warrant Shares issuable upon exercise of all the Warrants then outstanding (without regard to any limitations on the
exercise of the Warrants set forth therein) (collectively, the “Required Reserve Amount”); provided that at no
time shall the number of shares of Common Stock reserved pursuant to this Section 4(l) be reduced other than proportionally in
connection with any conversion, exercise and/or redemption, as applicable of Notes and Warrants. If at any time the number of shares
of Common Stock authorized and reserved for issuance is not sufficient to meet the Required Reserve Amount, the Company will
promptly take all corporate action necessary to authorize and reserve a sufficient number of shares, including, without limitation,
calling a special meeting of shareholders to authorize additional shares to meet the Company’s obligations pursuant to the
Transaction Documents, in the case of an insufficient number of authorized shares, obtain shareholder approval of an increase in
such authorized number of shares, and voting the management shares of the Company in favor of an increase in the authorized shares
of the Company to ensure that the number of authorized shares is sufficient to meet the Required Reserve Amount.


 


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


 


(n)          Other Notes; Variable Securities. . So long as any Notes remain outstanding, the Company and each Subsidiary shall be prohibited
from effecting or entering into an agreement to affect any Subsequent Placement involving a Variable Rate Transaction. “Variable
Rate Transaction” means a transaction in which the Company or any Subsidiary (i) issues or sells any Convertible Securities
either (A) at a conversion, exercise or exchange rate or other price that is based upon and/or varies with the trading prices of or quotations
for the shares of Common Stock at any time after the initial issuance of such Convertible Securities, or (B) with a conversion, exercise
or exchange price that is subject to being reset at some future date after the initial issuance of such Convertible Securities or upon
the occurrence of specified or contingent events directly or indirectly related to the business of the Company or the market for the Common
Stock, other than pursuant to a customary “weighted average” anti-dilution provision or (ii) enters into any agreement (including,
without limitation, an equity line of credit or an “at-the-market” offering) whereby the Company or any Subsidiary may sell
securities at a future determined price (other than standard and customary “preemptive” or “participation” rights).
Each Buyer shall be entitled to obtain injunctive relief against the Company and its Subsidiaries to preclude any such issuance, which
remedy shall be in addition to any right to collect damages.


 


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


 


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


 


(q)          Restriction on Redemption and Cash Dividends. So long as any Notes are outstanding, the Company shall not, directly or indirectly,
redeem, or declare or pay any cash dividend or distribution on, any securities of the Company without the prior express written consent
of the Buyers.


 


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


 


 


 


 






    	 	32	 



     

    

 


 


(s)          Stock Splits. Until the Notes and all notes issued pursuant to the terms thereof are no longer outstanding, the Company
shall not effect any stock combination, reverse stock split or other similar transaction (or make any public announcement or disclosure
with respect to any of the foregoing) without the prior written consent of the Required Holders (as defined below).


 


(t)           Conversion and Exercise Procedures. Each of the form of Exercise Notice (as defined in the Warrants) included in the Warrants
and the form of Conversion Notice (as defined in the Notes) included in the Notes set forth the totality of the procedures required of
the Buyers in order to exercise the Warrants or convert the Notes. Except as provided in Section 5(d), no additional legal opinion, other
information or instructions shall be required of the Buyers to exercise their Warrants or convert their Notes. The Company shall honor
exercises of the Warrants and conversions of the Notes and shall deliver the Conversion Shares and Warrant Shares in accordance with the
terms, conditions and time periods set forth in the Notes and Warrants.


 


(u)          Collateral Agent. Each Buyer hereby (i) appoints 3i, LP as the collateral agent hereunder and under the other Security Documents
(in such capacity, the “Collateral Agent”), and (ii) authorizes the Collateral Agent (and its officers, directors,
employees and agents) to take such action on such Buyer’s behalf in accordance with the terms hereof and thereof. The Collateral
Agent shall not have, by reason hereof or any of the other Security Documents, a fiduciary relationship in respect of any Buyer. Neither
the Collateral Agent nor any of its officers, directors, employees or agents shall have any liability to any Buyer for any action taken
or omitted to be taken in connection hereof or any other Security Document except to the extent caused by its own gross negligence or
willful misconduct, and each Buyer agrees to defend, protect, indemnify and hold harmless the Collateral Agent and all of its officers,
directors, employees and agents (collectively, the “Collateral Agent Indemnitees”) from and against any losses, damages,
liabilities, obligations, penalties, actions, judgments, suits, fees, costs and expenses (including, without limitation, reasonable attorneys’
fees, costs and expenses) incurred by such Collateral Agent Indemnitee, whether direct, indirect or consequential, arising from or in
connection with the performance by such Collateral Agent Indemnitee of the duties and obligations of Collateral Agent pursuant hereto
or any of the Security Documents. The Collateral Agent shall not be required to exercise any discretion or take any action, but shall
be required to act or to refrain from acting (and shall be fully protected in so acting or refraining from acting) upon the instructions
of the Required Holders, and such instructions shall be binding upon all holders of Notes; provided, however, that the Collateral Agent
shall not be required to take any action which, in the reasonable opinion of the Collateral Agent, exposes the Collateral Agent to liability
or which is contrary to this Agreement or any other Transaction Document or applicable law. The Collateral Agent shall be entitled to
rely upon any written notices, statements, certificates, orders or other documents or any telephone message believed by it in good faith
to be genuine and correct and to have been signed, sent or made by the proper Person, and with respect to all matters pertaining to this
Agreement or any of the other Transaction Documents and its duties hereunder or thereunder, upon advice of counsel selected by it.


 


		(v)	Successor Collateral Agent.



 


(i)    The
Collateral Agent may resign from the performance of all its functions and duties hereunder and under the other Transaction Documents
at any time by giving at least ten (10) Business Days’ prior written notice to the Company and each holder of Notes. Such
resignation shall take effect upon the acceptance by a successor Collateral Agent of appointment pursuant to clauses (ii) and (iii)
below or as otherwise provided below. If at any time the Collateral Agent (together with its affiliates) beneficially owns less than $25,000
in aggregate principal amount of Notes, the Required Holders may, by written consent, remove the Collateral Agent from all its
functions and duties hereunder and under the other Transaction Documents.


 


 


 


 






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(ii)   
Upon any such notice of resignation or removal, the Required Holders shall appoint a successor collateral agent. Upon the acceptance
of any appointment as Collateral Agent hereunder by a successor agent, such successor collateral agent shall thereupon succeed to and
become vested with all the rights, powers, privileges and duties of the collateral agent, and the Collateral Agent shall be discharged
from its duties and obligations under this Agreement and the other Transaction Documents. After the Collateral Agent’s resignation
or removal hereunder as the collateral agent, the provisions of this Section 4(v) shall inure to its benefit as to any actions taken
or omitted to be taken by it while it was the Collateral Agent under this Agreement and the other Transaction Documents.


 


(iii)    
If a successor collateral agent shall not have been so appointed within ten (10) Business Days of receipt of a written notice
of resignation or removal, the Collateral Agent shall then appoint a successor collateral agent who shall serve as the Collateral
Agent until such time, if any, as the Required Holders appoint a successor collateral agent as provided above.


 


(iv)   
In the event that a successor Collateral Agent is appointed pursuant to the provisions of this Section 4(v) that is not a Buyer
or an affiliate of any Buyer (or the Required Holders or the Collateral Agent (or its successor), as applicable, notify the Company that
they or it wants to appoint such a successor Collateral Agent pursuant to the terms of this Section 4(v)), the Company and each Subsidiary
thereof covenants and agrees to promptly take all actions reasonably requested by the Required Holders or the Collateral Agent (or its
successor), as applicable, from time to time, to secure a successor Collateral Agent satisfactory to the requesting part(y)(ies), in their
sole discretion, including, without limitation, by paying all reasonable and customary fees and expenses of such successor Collateral
Agent, by having the Company and each Subsidiary thereof agree to indemnify any successor Collateral Agent pursuant to reasonable and
customary terms and by each of the Company and each Subsidiary thereof executing a collateral agency agreement or similar agreement and/or
any amendment to the Security Documents reasonably requested or required by the successor Collateral Agent.


 


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


 


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


 


 


 


 






    	 	34	 



     

    

 


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


 


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


 


(aa)        Subsidiary
Guarantee. For so long as any Notes remain outstanding, upon any entity becoming a Subsidiary of the Company, the Company shall cause
each such Subsidiary to become party to the Guaranty by executing a joinder to the Guaranty reasonably satisfactory in form and substance
to the Required Holders.


 


(bb)        No
Sales of Pre-Delivery Shares; Return of Pre-Delivery Shares. Each Buyer, severally, hereby covenants and agrees (i) not to sell any
Pre-Delivery Shares issued to such Buyer until such time as such Pre-Delivery Shares shall become Delivery Shares (as defined in the Notes)
and (ii) that if such Buyer holds any Pre-Delivery Shares after such date that no Notes are then held by such Buyer (whether following
the conversion or redemption, as applicable, of all Notes then held by such Buyer, but after any applicable Delivery Share Applications
(as defined in the Notes) related thereto), such remaining Pre-Delivery Shares shall be promptly returned by such Buyer to the Company
for cancellation.


 


(cc)         Holding
Period. For the purposes of Rule 144, the Company acknowledges that the holding period of the Pre-Delivery Shares may be tacked onto
the holding period of the Notes and shall, consequently, be deemed to have been issued as of the Closing Date for purposes of Rule 144
and the Company agrees not to take a position contrary to this Section 4(cc).


 


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


 


		5.	REGISTER; TRANSFER AGENT INSTRUCTIONS; LEGEND.



 


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


 


 


 


 






    	 	35	 



     

    

 


(b)              
Transfer Agent Instructions. The Company shall issue irrevocable instructions to its transfer agent and any subsequent transfer
agent (as applicable, the “Transfer Agent”) in a form acceptable to each of the Buyers (the “Irrevocable Transfer
Agent Instructions”) to issue certificates or credit shares to the applicable balance accounts at The Depository Trust Company
(“DTC”), registered in the name of each Buyer or its respective nominee(s), for the Conversion Shares and the Warrant
Shares in such amounts as specified from time to time by each Buyer to the Company upon conversion of the Notes or the exercise of the
Warrants (as the case may be). The Company represents and warrants that no instruction other than the Irrevocable Transfer Agent Instructions
referred to in this Section 5(b), and stop transfer instructions to give effect to Section 2(g) hereof, will be given by the Company to
its transfer agent with respect to the Securities, and that the Securities shall otherwise be freely transferable on the books and records
of the Company, as applicable, to the extent provided in this Agreement and the other Transaction Documents. If a Buyer effects a sale,
assignment or transfer of the Securities in accordance with Section 2(g), the Company shall permit the transfer and shall promptly instruct
its transfer agent to issue one or more certificates or credit shares to the applicable balance accounts at DTC in such name and in such
denominations as specified by such Buyer to effect such sale, transfer or assignment. In the event that such sale, assignment or transfer
involves Conversion Shares or Warrant Shares sold, assigned or transferred pursuant to an effective registration statement or in compliance
with Rule 144, the transfer agent shall issue such shares to such Buyer, assignee or transferee (as the case may be) without any restrictive
legend in accordance with Section 5(d) below. The Company acknowledges that a breach by it of its obligations hereunder will cause irreparable
harm to a Buyer. Accordingly, the Company acknowledges that the remedy at law for a breach of its obligations under this Section 5(b)
will be inadequate and agrees, in the event of a breach or threatened breach by the Company of the provisions of this Section 5(b), that
a Buyer shall be entitled, in addition to all other available remedies, to an order and/or injunction restraining any breach and requiring
immediate issuance and transfer, without the necessity of showing economic loss and without any bond or other security being required.
The Company shall cause its counsel to issue the legal opinion referred to in the Irrevocable Transfer Agent Instructions to the Company’s
transfer agent on each Effective Date (as defined in the Registration Rights Agreement). Any fees (with respect to the transfer agent,
counsel to the Company or otherwise) associated with the issuance of such opinion or the removal of any legends on any of the Securities
shall be borne by the Company.


 


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


 


 


 


 






    	 	36	 



     

    

 


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


 


(d)               Removal
of Legends. Certificates evidencing Securities shall not be required to contain the legend set forth in Section 5(c) above or
any other legend (i) while a registration statement (including a Registration Statement) covering the resale of such Securities is
effective under the 1933 Act, (ii) following any sale of such Securities pursuant to Rule 144 (assuming the transferor is not an
affiliate of the Company), (iii) if such Securities are eligible to be sold, assigned or transferred under Rule 144 (provided that a
Buyer provides the Company with reasonable assurances that such Securities are eligible for sale, assignment or transfer under Rule
144 which shall not include an opinion of Buyer’s counsel), (iv) in connection with a sale, assignment or other transfer
(other than under Rule 144), provided that such Buyer provides the Company with an opinion of counsel to such Buyer, in a generally
acceptable form, to the effect that such sale, assignment or transfer of the Securities may be made without registration under the
applicable requirements of the 1933 Act or (v) if such legend is not required under applicable requirements of the 1933 Act
(including, without limitation, controlling judicial interpretations and pronouncements issued by the SEC). If a legend is not
required pursuant to the foregoing, the Company shall no later than two (2) Trading Days (or such earlier date as required pursuant
to the 1934 Act or other applicable law, rule or regulation for the settlement of a trade initiated on the date such Buyer delivers
such legended certificate representing such Securities to the Company) following the delivery by a Buyer to the Company or the
transfer agent (with notice to the Company) of a legended certificate representing such Securities (endorsed or with stock powers
attached, signatures guaranteed, and otherwise in form necessary to affect the reissuance and/or transfer, if applicable), together
with any other deliveries from such Buyer as may be required above in this Section 5(d), as directed by such Buyer, either: (A)
provided that the Company’s transfer agent is participating in the DTC Fast Automated Securities Transfer Program and such
Securities are Conversion Shares or Warrant Shares, credit the aggregate number of shares of Common Stock to which such Buyer shall
be entitled to such Buyer’s or its designee’s balance account with DTC through its Deposit/Withdrawal at Custodian
system or (B) if the Company’s transfer agent is not participating in the DTC Fast Automated Securities Transfer Program,
issue and deliver (via reputable overnight courier) to such Buyer, a certificate representing such Securities that is free from all
restrictive and other legends, registered in the name of such Buyer or its designee (the date by which such credit is so required to
be made to the balance account of such Buyer’s or such Buyer’s designee with DTC or such certificate is required to be
delivered to such Buyer pursuant to the foregoing is referred to herein as the “Required Delivery Date”, and the
date such shares of Common Stock are actually delivered without restrictive legend to such Buyer or such Buyer’s designee with
DTC, as applicable, the “Share Delivery Date”). The Company shall be responsible for any transfer agent fees or
DTC fees with respect to any issuance of Securities or the removal of any legends with respect to any Securities in accordance
herewith.


 


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


 


 


 






    	 	37	 



     

    

 


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


 


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



 


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


 


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


 


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


 


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


 


 


 


 


 






    	 	38	 



     

    

 


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


 


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


 


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


 


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


 


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



 


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


 


(i)   
The Company and each Subsidiary (as the case may be) shall have duly executed and delivered to such Buyer each of the Transaction
Documents to which it is a party and the Company shall have duly executed and delivered to such Buyer (A) an Initial Note in such original
principal amount as is set forth across from such Buyer’s name in column (3) of the Schedule of Buyers, (B) the Pre-Delivery Shares
with respect to such Initial Note and (C) a Warrant initially exercisable for such aggregate number of Warrant Shares as is set forth
across from such Buyer’s name in column (4) of the Schedule of Buyers, in each case, as being purchased by such Buyer at the Initial
Closing pursuant to this Agreement.


 


 


 


 






    	 	39	 



     

    

 


(ii)   
Such Buyer shall have received the opinion of David E. Price, Esq., the Company’s counsel, dated as of the Initial
Closing Date, in the form acceptable to such Buyer.


 


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


 


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


 


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


 


(vi)   
The Company shall have delivered to such Buyer a certified copy of the Articles of Incorporation as certified by the Nevada Secretary
of State within ten (10) days of the Initial Closing Date.


 


(vii)   
Each Subsidiary shall have delivered to such Buyer a certified copy of its Articles of Incorporation (or such equivalent organizational
document) as certified by the Secretary of State (or comparable office) of such Subsidiary’s jurisdiction of incorporation within
ten (10) days of the Initial Closing Date.


 


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


 


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


 


 


 


 






    	 	40	 



     

    

 


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


 


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


 


(xii)   
The Company shall have obtained all governmental, regulatory or third party consents and approvals, if any, necessary for the sale
of the Securities, including without limitation, those required by the Principal Market, if any.


 


(xiii)  
No statute, rule, regulation, executive order, decree, ruling or injunction shall have been enacted, entered, promulgated or endorsed
by any court or Governmental Entity of competent jurisdiction that prohibits the consummation of any of the transactions contemplated
by the Transaction Documents.


 


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


 


(xv)  
The Company shall have obtained approval of the Principal Market to list or designate for quotation (as the case may be) the Conversion
Shares (including the Pre- Delivery Shares) and the Warrant Shares.


 


(xvi)   In
accordance with the terms of the Security Documents, the Company shall have delivered to the Collateral Agent (A) original
certificates (I) representing the Subsidiaries’ shares of capital stock to the extent such subsidiary is a corporation or
otherwise has certificated equity and (II) representing all other equity interests and all promissory notes required to be pledged
thereunder, in each case, accompanied by undated stock powers and allonges executed in blank and other proper instruments of
transfer and (B)   appropriate financing statements on
Form UCC-1 to be duly filed in such office or offices as may be necessary or, in the opinion of the Collateral Agent, desirable to
perfect the security interests purported to be created by each Security Document (the “Perfection
Certificate”).


 


(xvii)   Within
two (2) Business Days prior to the Initial Closing, the Company shall have delivered or caused to be delivered to each Buyer and the
Collateral Agent (A) certified copies of requests for copies of information on Form UCC-11, listing all effective financing
statements which name as debtor the Company or any of its Subsidiaries and which are filed in such office or offices as may be
necessary or, in the opinion of the Collateral Agent or the Buyers, desirable to perfect the security interests purported to be
created by the Security Agreement, together with copies of such financing statements, none of which, except as otherwise agreed in
writing by the Collateral Agent, shall cover any of the Collateral (as defined in the Security Agreement), and the results of
searches for any tax Lien and judgment Lien filed against such Person or its property, which results, except as otherwise agreed to
in writing by the Collateral Agent and the Buyers, shall not show any such Liens; and (B) a perfection certificate, duly completed
and executed by the Company and each of its Subsidiaries, in form and substance satisfactory to the Buyers.


 


 


 


 






    	 	41	 



     

    

 


(xviii)  
The Collateral Agent shall have received the Security Agreement, duly executed by the Company and each of its Subsidiaries, together
with the original stock certificates representing all of the equity interests and all promissory notes required to be pledged thereunder,
accompanied by undated stock powers and allonges executed in blank and other proper instruments of transfer.


 


(xix)  
With respect to the Intellectual Property Rights, if any, of the Company or any of its Subsidiaries, the Company and/or such Subsidiaries,
as applicable, shall have duly executed and delivered to such Buyer each Assignment For Security for the Intellectual Property Rights
of the Company and its Subsidiaries, in the form attached as Exhibit A to the Security Agreement.


 


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


 


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


 


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


 


(i)   
The Company and each Subsidiary (as the case may be) shall have duly executed and delivered to such Buyer each of the Transaction
Documents to which it is a party and the Company shall have duly executed and delivered to such Buyer (A) an Additional Note in the Additional
Note Amount as being purchased by such Buyer at such Additional Closing pursuant to this Agreement and (B) the Pre-Delivery Shares with
respect to such Additional Note.


 


(ii)   
Such Buyer shall have received the opinion of David E. Price, Esq., the Company’s counsel, dated as of such Additional Closing
Date, in the form acceptable to such Buyer.


 


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


 


 


 


 






    	 	42	 



     

    

 


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


 


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


 


(vi)   
The Company shall have delivered to such Buyer a certified copy of the Articles of Incorporation as certified by the Nevada Secretary
of State within ten (10) days of such Additional Closing Date.


 


(vii)   
Each Subsidiary shall have delivered to such Buyer a certified copy of its Articles of Incorporation (or such equivalent organizational
document) as certified by the Secretary of State (or comparable office) of such Subsidiary’s jurisdiction of incorporation within
ten (10) days of such Additional Closing Date.


 


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


 


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


 


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


 


 


 


 






    	 	43	 



     

    

 


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


 


(xii)   
The Company shall have obtained all governmental, regulatory or third party consents and approvals, if any, necessary for the sale
of the Securities, including without limitation, those required by the Principal Market, if any.


 


(xiii)  
No statute, rule, regulation, executive order, decree, ruling or injunction shall have been enacted, entered, promulgated or endorsed
by any court or Governmental Entity of competent jurisdiction that prohibits the consummation of any of the transactions contemplated
by the Transaction Documents.


 


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


 


(xv)  
The Company shall have obtained approval of the Principal Market to list or designate for quotation (as the case may be) the Conversion
Shares (including the Pre- Delivery Shares) and the Warrant Shares.


 


(xvi)   In
accordance with the terms of the Security Documents, the Company shall have delivered to the Collateral Agent (A) original
certificates (I) representing the Subsidiaries’ shares of capital stock to the extent such subsidiary is a corporation or
otherwise has certificated equity and (II) representing all other equity interests and all promissory notes required to be pledged
thereunder, in each case, accompanied by undated stock powers and allonges executed in blank and other proper instruments of
transfer and (B) appropriate financing statements on Form UCC-1 to be duly filed in such office or offices as may be necessary or,
in the opinion of the Collateral Agent, desirable to perfect the security interests purported to be created by each Security
Document (the “Perfection Certificate”).


 


(xvii)  
Within two (2) Business Days prior to such Additional Closing, the Company shall have delivered or caused to be delivered to each
Buyer and the Collateral Agent (A) certified copies of requests for copies of information on Form UCC-11, listing all effective financing
statements which name as debtor the Company or any of its Subsidiaries and which are filed in such office or offices as may be necessary
or, in the opinion of the Collateral Agent or the Buyers, desirable to perfect the security interests purported to be created by the Security
Agreement, together with copies of such financing statements, none of which, except as otherwise agreed in writing by the Collateral Agent,
shall cover any of the Collateral (as defined in the Security Agreement), and the results of searches for any tax Lien and judgment Lien
filed against such Person or its property, which results, except as otherwise agreed to in writing by the Collateral Agent and the Buyers,
shall not show any such Liens; and (B) a perfection certificate, duly completed and executed by the Company and each of its Subsidiaries,
in form and substance satisfactory to the Buyers.


 


 


 






    	 	44	 



     

    

 


(xviii)  
The Collateral Agent shall have received the Security Agreement, duly executed by the Company and each of its Subsidiaries, together
with the original stock certificates representing all of the equity interests and all promissory notes required to be pledged thereunder,
accompanied by undated stock powers and allonges executed in blank and other proper instruments of transfer.


 


(xix)  
With respect to the Intellectual Property Rights, if any, of the Company or any of its Subsidiaries, the Company and/or such Subsidiaries,
as applicable, shall have duly executed and delivered to such Buyer each Assignment For Security for the Intellectual Property Rights
of the Company and its Subsidiaries, in the form attached as Exhibit A to the Security Agreement.


 


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


 


(xxi)  
Solely with respect to the Second Additional Closing, no Equity Conditions Failure (as defined in the Initial Notes) then exists.


 


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


 


		8.	TERMINATION.



 


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


 


 


 


 


 






    	 	45	 



     

    

 


		9.	MISCELLANEOUS.



 


(a)                Governing
Law; Jurisdiction; Jury Trial. All questions concerning the construction, validity, enforcement and interpretation of this
Agreement shall be governed by the internal laws of the State of New York, without giving effect to any choice of law or conflict of
law provision or rule (whether of the State of New York or any other jurisdictions) that would cause the application of the laws of
any jurisdictions other than the State of New York. The Company hereby irrevocably submits to the exclusive jurisdiction of the
state and federal courts sitting in The City of New York, Borough of Manhattan, for the adjudication of any dispute hereunder or in
connection herewith or under any of the other Transaction Documents or with any transaction contemplated hereby or thereby, and
hereby irrevocably waives, and agrees not to assert in any suit, action or proceeding, any claim that it is not personally subject
to the jurisdiction of any such court, that such suit, action or proceeding is brought in an inconvenient forum or that the venue of
such suit, action or proceeding is improper. Each party hereby irrevocably waives personal service of process and consents to
process being served in any such suit, action or proceeding by mailing a copy thereof to such party at the address for such notices
to it under this Agreement and agrees that such service shall constitute good and sufficient service of process and notice thereof.
Nothing contained herein shall be deemed to limit in any way any right to serve process in any manner permitted by law. Nothing
contained herein shall be deemed or operate to preclude any Buyer from bringing suit or taking other legal action against the
Company in any other jurisdiction to collect on the Company’s obligations to such Buyer or to enforce a judgment or other
court ruling in favor of such Buyer. The Company (on behalf of itself and each of its Subsidiaries) hereby appoints David E. Price,
Esq. as its agent for service of process in New York. EACH PARTY HEREBY IRREVOCABLY WAIVES ANY RIGHT IT MAY HAVE TO, AND AGREES
NOT TO REQUEST, A JURY TRIAL FOR THE ADJUDICATION OF ANY DISPUTE HEREUNDER OR UNDER ANY OTHER TRANSACTION DOCUMENT OR IN CONNECTION
WITH OR ARISING OUT OF THIS AGREEMENT, ANY OTHER TRANSACTION DOCUMENT OR ANY TRANSACTION CONTEMPLATED HEREBY OR THEREBY. The
choice of laws of the State of New York as the governing law of this Agreement will be honored by competent courts in the State of
Israel, subject to compliance with relevant the State of Israel civil procedural requirements. The Company or any of their
respective properties, assets or revenues does not have any right of immunity under the State of Israel or New York law, from any
legal action, suit or proceeding, from the giving of any relief in any such legal action, suit or proceeding, from set-off or
counterclaim, from the jurisdiction of the State of Israel, New York or United States federal court, from service of process,
attachment upon or prior to judgment, or attachment in aid of execution of judgment, or from execution of a judgment, or other legal
process or proceeding for the giving of any relief or for the enforcement of a judgment, in any such court, with respect to its
obligations, liabilities or any other matter under or arising out of or in connection with this Agreement; and, to the extent that
the Company, or any of its properties, assets or revenues may have or may hereafter become entitled to any such right of immunity in
any such court in which proceedings may at any time be commenced, the Company hereby waives such right to the extent permitted by
law and hereby consents to such relief and enforcement as provided in this Agreement and the other Transaction Documents.


 


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


 


 


 


 






    	 	46	 



     

    

 


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


 


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


 


 


 


 


 


 






    	 	47	 



     

    

 


(e)                Entire
Agreement; Amendments. This Agreement, the other Transaction Documents and the schedules and exhibits attached hereto and
thereto and the instruments referenced herein and therein supersede all other prior oral or written agreements between the Buyers,
the Company, its Subsidiaries, their affiliates and Persons acting on their behalf, including, without limitation, any transactions
by any Buyer with respect to Common Stock or the Securities, and the other matters contained herein and therein, and this Agreement,
the other Transaction Documents, the schedules and exhibits attached hereto and thereto and the instruments referenced herein and
therein contain the entire understanding of the parties solely with respect to the matters covered herein and therein; provided,
however, nothing contained in this Agreement or any other Transaction Document shall (or shall be deemed to) (i) have any effect on
any agreements any Buyer has entered into with, or any instruments any Buyer has received from, the Company or any of its
Subsidiaries prior to the date hereof with respect to any prior investment made by such Buyer in the Company or (ii) waive, alter,
modify or amend in any respect any obligations of the Company or any of its Subsidiaries, or any rights of or benefits to any Buyer
or any other Person, in any agreement entered into prior to the date hereof between or among the Company and/or any of its
Subsidiaries and any Buyer, or any instruments any Buyer received from the Company and/or any of its Subsidiaries prior to the date
hereof, and all such agreements and instruments shall continue in full force and effect. Except as specifically set forth herein or
therein, neither the Company nor any Buyer makes any representation, warranty, covenant or undertaking with respect to such matters.
For clarification purposes, the Recitals are part of this Agreement. No provision of this Agreement may be amended other than by an
instrument in writing signed by the Company and the Required Holders (as defined below), and any amendment to any provision of this
Agreement made in conformity with the provisions of this Section 9(e) shall be binding on all Buyers and holders of Securities, as
applicable; provided that no such amendment shall be effective to the extent that it (A) applies to less than all of the holders of
the Securities then outstanding or (B) imposes any obligation or liability on any Buyer without such Buyer’s prior written
consent (which may be granted or withheld in such Buyer’s sole discretion); and provided further that the provisions of
Sections 4(u) and 4(v) above cannot be amended or waived without the additional prior written approval of the Collateral Agent or
its successor. No waiver shall be effective unless it is in writing and signed by an authorized representative of the waiving party,
provided that the Required Holders may waive any provision of this Agreement, and any waiver of any provision of this Agreement made
in conformity with the provisions of this Section 9(e) shall be binding on all Buyers and holders of Securities, as applicable,
provided that no such waiver shall be effective to the extent that it (1) applies to less than all of the holders of the Securities
then outstanding (unless a party gives a waiver as to itself only) or (2) imposes any obligation or liability on any Buyer without
such Buyer’s prior written consent (which may be granted or withheld in such Buyer’s sole discretion). No consideration
(other than reimbursement of legal fees) shall be offered or paid to any Person to amend or consent to a waiver or modification of
any provision of any of the Transaction Documents unless the same consideration also is offered to all of the parties to the
Transaction Documents, all holders of the Notes or all holders of the Warrants (as the case may be). From the date hereof and while
any Notes or Warrants are outstanding, the Company shall not be permitted to receive any consideration from a Buyer or a holder of
Notes or Warrants that is not otherwise contemplated by the Transaction Documents in order to, directly or indirectly, induce the
Company or any Subsidiary (i) to treat such Buyer or holder of Notes or Warrants in a manner that is more favorable than to other
similarly situated Buyers or holders of Notes or Warrants, as applicable, or (ii) to treat any Buyer(s) or holder(s) of Notes or
Warrants in a manner that is less favorable than the Buyer or holder of Notes or Warrants that is paying such consideration;
provided, however, that the determination of whether a Buyer has been treated more or less favorably than another Buyer shall
disregard any securities of the Company purchased or sold by any Buyer. The Company has not, directly or indirectly, made any
agreements with any Buyers relating to the terms or conditions of the transactions contemplated by the Transaction Documents except
as set forth in the Transaction Documents. Without limiting the foregoing, the Company confirms that, except as set forth in this
Agreement, no Buyer has made any commitment or promise or has any other obligation to provide any financing to the Company, any
Subsidiary or otherwise. As a material inducement for each Buyer to enter into this Agreement, the Company expressly acknowledges
and agrees that (x) no due diligence or other investigation or inquiry conducted by a Buyer, any of its advisors or any of its
representatives shall affect such Buyer’s right to rely on, or shall modify or qualify in any manner or be an exception to any
of, the Company’s representations and warranties contained in this Agreement or any other Transaction Document and (y) unless
a provision of this Agreement or any other Transaction Document is expressly preceded by the phrase “except as disclosed in
the SEC Documents,” nothing contained in any of the SEC Documents shall affect such Buyer’s right to rely on, or shall
modify or qualify in any manner or be an exception to any of, the Company’s representations and warranties contained in this
Agreement or any other Transaction Document. “Required Holders” means (I) prior to the Initial Closing Date, each
Buyer entitled to purchase Notes at the Initial Closing and (II) on or after the Initial Closing Date, holders of a majority of the
Registrable Securities as of such time (excluding any Registrable Securities held by the Company or any of its Subsidiaries as of
such time) issued or issuable hereunder or pursuant to the Notes and/or the Warrants.


 


 


 


 


 






    	 	48	 



     

    

 


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


 


If to the Company:


 


Cannabics Pharmaceuticals Inc.


#3 Bethesda Metro Center, #700


Bethesda, Maryland 20814


(202) 536-5191


David@Cannabics.com


 


And:Cannabics Pharmaceuticals Inc.


11 HaBarzel St


Tel Aviv, Israel 6971017


(972) 54544-3881


 


If to the Transfer Agent:


Cleartrust Transfer LLC


18540 Pointe Village Dr,
#210


Lutz, Fla 33558


(813) 235-4490


Attn: Ms. Kara Kennedy Inbox@Cleartrust.com


 


 


 


 






    	 	49	 



     

    

 


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


 


with a copy (for informational
purposes only) to:


 


Kelley Drye & Warren LLP


101 Park Avenue New York, NY 10178


Telephone: (212) 808-7540


Facsimile: (212) 808-7897


Attention: Michael A. Adelstein, Esq.


E-mail: madelstein@kelleydrye.com


 


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


 


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


 


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


 


 


 


 






    	 	50	 



     

    

 


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


 


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


 


(k)               Indemnification.
In consideration of each Buyer’s execution and delivery of the Transaction Documents and acquiring the Securities thereunder
and in addition to all of the Company’s other obligations under the Transaction Documents, the Company shall defend, protect,
indemnify and hold harmless each Buyer and each holder of any Securities and all of their shareholders, partners, members, officers,
directors, employees and direct or indirect investors and any of the foregoing Persons’ agents or other representatives
(including, without limitation, those retained in connection with the transactions contemplated by this Agreement) (collectively,
the “Indemnitees”) from and against any and all actions, causes of action, suits, claims, losses, costs,
penalties, fees, liabilities and damages, and expenses in connection therewith (irrespective of whether any such Indemnitee is a
party to the action for which indemnification hereunder is sought), and including reasonable attorneys’ fees and disbursements
(the “Indemnified Liabilities”), incurred by any Indemnitee as a result of, or arising out of, or relating to (i)
any misrepresentation or breach of any representation or warranty made by the Company or any Subsidiary in any of the Transaction
Documents, (ii) any breach of any covenant, agreement or obligation of the Company or any Subsidiary contained in any of the
Transaction Documents or (iii) any cause of action, suit, proceeding or claim brought or made against such Indemnitee by a third
party (including for these purposes a derivative action brought on behalf of the Company or any Subsidiary) or which otherwise
involves such Indemnitee that arises out of or results from (A) the execution, delivery, performance or enforcement of any of the
Transaction Documents, (B) any transaction financed or to be financed in whole or in part, directly or indirectly, with the proceeds
of the issuance of the Securities, (C) any disclosure properly made by such Buyer pursuant to Section 4(i), or (D) the status of
such Buyer or holder of the Securities either as an investor in the Company pursuant to the transactions contemplated by the
Transaction Documents or as a party to this Agreement (including, without limitation, as a party in interest or otherwise in any
action or proceeding for injunctive or other equitable relief). To the extent that the foregoing undertaking by the Company may be
unenforceable for any reason, the Company shall make the maximum contribution to the payment and satisfaction of each of the
Indemnified Liabilities which is permissible under applicable law. Except as otherwise set forth herein, the mechanics and
procedures with respect to the rights and obligations under this Section 9(k) shall be the same as those set forth in Section 6 of
the Registration Rights Agreement.


 


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


 


 


 


 






    	 	51	 



     

    

 


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


 


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


 


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


 


 


 


 


 






    	 	52	 



     

    

 


		(p)	Judgment Currency.



 


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


 


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


 


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


 


(ii)   
If in the case of any proceeding in the court of any jurisdiction referred to in Section 9(p)(i)(2) above, there is a change in
the Exchange Rate prevailing between the Judgment Conversion Date and the date of actual payment of the amount due, the applicable party
shall pay such adjusted amount as may be necessary to ensure that the amount paid in the Judgment Currency, when converted at the Exchange
Rate prevailing on the date of payment, will produce the amount of US Dollars which could have been purchased with the amount of Judgment
Currency stipulated in the judgment or judicial order at the Exchange Rate prevailing on the Judgment Conversion Date.


 


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


 


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


 


[signature pages follow]


 


 


 


 


 






    	 	53	 



     

    




 


 


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


 


 





	 	COMPANY:
	 	 
	 	CANNABICS PHARMACEUTICALS INC.  
	 	 
	 	 
	 	By: /s/ Eyal Barad                      
	 	Eyal Barad, Dir., CEO
	 	 



 


 



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


 


 









	 	BUYER:
	 	 
	 	3I, LP.
	 	 
	 	 
	 	By: _____________________
	 	Title:
	 	 



 


 


 


 






    	 	54	 



     

    

 


SCHEDULE
OF BUYERS


 


 


	
     

    (1)
	
     

    (2)
	
     

    (3)
	
     

    (4)
	
     

    (5)
	
     

    (6)

	 	 	 	 	 	 
	
     

     

     

     

    Buyer
	
     

     

     

     

    Address and Facsimile Number
	
     

    Original
    Principal Amount of Initial Notes
	
     

     

    Aggregate
    Number of Warrant Shares
	
     

     

     

    Initial Purchase Price
	 	
     

     

     

    Legal Representative’s Address
    and Facsimile Number

	 	 	 	 	 	 
	
     

    3i, LP
	
     

    3i, LP

    140 Broadway, 38th Floor New York, NY 10005 Telephone:
    (646) 845-0040

    Facsimile: (646) 839-2626 Attention Maier J. Tarlow
	
     

    $825,000
	
     

    5,500,000
	
     

    $750,000
	
     

    Kelley Drye & Warren LLP 101 Park Avenue

    New York, NY 10178 Telephone: (212) 808-7540

    Facsimile: (212) 808-7897

    Attention: Michael A. Adelstein, Esq.



 


 


 


 






    	 	55	 



     

    

 


SCHEDULE OF ADDITIONAL CLOSINGS


 


 


	
     

    (1)
	
     

    (2)
	
     

    (3)
	
     

    (4)

	 	 	 	 
	
     

     

     

     

    Buyer
	Original Principal Amount of Additional Notes at the First Additional Closing	
     

    Original Principal Amount of Additional
    Notes at the Second Additional Closing
	 	
     

     

     

    Legal Representative’s
    Address and Facsimile Number

	 	 	 	 
	3i, LP	$550,000	$1,375,000	
     

    Kelley Drye & Warren LLP 101 Park Avenue

    New York, NY 10178 Telephone: (212) 808-7540

    Facsimile: (212) 808-7897

    Attention: Michael A. Adelstein, Esq.



 


 


 


 


 


 






    	 	56