SECURITIES
PURCHASE AGREEMENT


 


This
Securities Purchase Agreement (this “Agreement”) is dated as of May 15, 2015, between OSL
Holdings Inc. (the “Company”) and each purchaser identified on the signature
pages hereto (each, including its successors and assigns, a “Purchaser” and collectively, the “Purchasers”).



 


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


 


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


 


ARTICLE
I. 


DEFINITIONS



 


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


 


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


 


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


 


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


 


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


 


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



 


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


 




    	1



    	 



    


 


“Closing(s)”
means the one or more closings of the purchase and sale of the Securities pursuant to Section 2.2.


 


“Closing
Statement” means the Closing Statement in the form on Annex A attached hereto. 


 


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


 


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


 


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


 


“Company
Counsel” means Sichenzia Ross Friedman Ference LLP.



 


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


 


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


 


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


 


“Effective
Date” means the earliest of the date that (a)
all of the Underlying Shares have been sold pursuant to Rule 144 or may be sold pursuant to Rule 144 without the requirement for
the Company to be in compliance with the current public information required under Rule 144 and without volume or manner-of-sale
restrictions, or (b) following the one year anniversary of the Closing Date, provided that a holder of Underlying Shares is not
an Affiliate of the Company, all of the Underlying Shares may be sold pursuant to an exemption from registration under Section
4(1) of the Securities Act without volume or manner-of-sale restrictions and Company counsel has delivered to such holders a standing
written unqualified opinion that resales may then be made by such holders of the Underlying Shares pursuant to such exemption
which opinion shall be in form and substance reasonably acceptable to such holders. 


 


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


 


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


 




    	2



    	 



    


 


“Exempt
Issuance” means the issuance of (i) securities issued under
the Company’s equity incentive plan existing on the date of this Agreement and any amendments thereto approved by the Board
of Directors, including securities issuable upon conversion or exercise of such securities, (ii) securities issued for consideration
other than cash pursuant to a strategic arrangement, joint venture, merger, consolidation, acquisition, or similar business combination
approved by the Board of Directors and (iii) securities issued upon the exercise or exchange of or conversion of any Securities
issued hereunder and/or other securities exercisable or exchangeable for or convertible into shares of Common Stock issued and
outstanding on the date of this Agreement, provided that such securities have not been amended since the date of this Agreement
to increase the number of such securities or to decrease the exercise price, exchange price or conversion price of such securities.


 


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


 


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


 


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


 


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


 


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


 


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


 


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


 


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


 


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


 


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


 


“Note”
means the 10% Convertible Note due, subject to the terms therein, twelve (12) months from the date of issuance, issued by the
Company to the Purchasers hereunder, in the form of Exhibit A attached hereto. 


 


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


 


“Pre-Notice”
shall have the meaning ascribed to such term in Section 4.12(b). 


 




    	3



    	 



    


 


“Principal
Amount” means, as to each Purchaser, the amounts set forth below such Purchaser’s signature block on the signature
pages hereto next to the heading “Principal Amount,” in United States Dollars. 


 


“Pro
Rata Portion” shall have the meaning ascribed to such term in Section 4.12(e). 


 


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


 


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


 


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


 


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


 


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


 


“Required
Minimum” means, as of any date, the maximum aggregate number of shares of Common Stock then issued or potentially issuable
in the future pursuant to the Transaction Documents, including any Underlying Shares issuable upon conversion in full of all Notes
(including Underlying Shares issuable as payment of interest on the Notes), ignoring any conversion or exercise limits set forth
therein, and assuming that the Conversion Price is at all times on and after the date of determination 200% of the then Conversion
Price on the Trading Day immediately prior to the date of determination. 


 


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



 


“Rule
424” means Rule 424 promulgated by the Commission pursuant to the Securities Act, as such Rule may be amended or interpreted
from time to time, or any similar rule or regulation hereafter adopted by the Commission having substantially the same purpose
and effect as such Rule. 


 


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


 


“Securities”
means the Notes and the Underlying Shares. 


 


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


 


“Short
Sales” means all “short sales” as defined in Rule 200 of Regulation SHO under the Exchange Act. 


 




    	4



    	 



    


 


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


 


“Subsidiary”
means any subsidiary of the Company as set forth on Schedule 3.1(a) and shall, where applicable, also include any direct or indirect
subsidiary of the Company formed or acquired after the date hereof. 


 


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


 


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


 


“Tranche(s)”
shall have the meaning ascribed to such term in Section 2.1. 


 


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


 


“Transfer
Agent” means VStock Transfer, LLC the current transfer agent of the Company, with a mailing address of 18 Lafayette Place,
Woodmere, NY 11598 and a phone number of (212) 828-8436, and any successor transfer agent of the Company. 


 


“Transfer
Agent Instruction Letter” means the letter from the Company to the Transfer Agent which instructs the Transfer Agent to
issue Underlying Shares pursuant to the Transaction Documents, in the form of Exhibit B attached hereto. 


 


“Underlying
Shares” means the shares of Common Stock issued and issuable upon conversion or redemption of the Notes and issued and issuable
in lieu of the cash payment of interest on the Notes in accordance with the terms of the Notes. 


 


ARTICLE
II. 


PURCHASE
AND SALE 


 


2.1
Purchase. The Purchasers will purchase an aggregate of up to $250,000 in Subscription Amount corresponding to an aggregate of
up to $256,250 in Principal Amount of Notes. The purchase will occur in two (2) tranches (each a “Tranche,” and collectively
the “Tranches”), with the first Tranche of $150,000 being closed upon execution of this Agreement (the “First
Closing”). The second Tranche will be for $100,000 and will occur on May 22, 2015; provided there is no event of default
then existing on any Note and the Equity Conditions are satisfied on such date. 


 




    	5



    	 



    


 


2.2
Closing. On each Closing Date, upon the terms and subject to the conditions set forth herein, substantially concurrent with the
execution and delivery of this Agreement by the parties hereto, the Company agrees to sell, and each Purchaser, severally and
not jointly, agrees to purchase, such Purchaser’s Closing Subscription Amount as set forth on the signature page hereto
executed by such Purchaser (an aggregate of up to $250,000 in Subscription Amount corresponding to an aggregate of up to $256,250
in Principal Amount of Notes). At each Closing, each Purchaser shall deliver to the Company, via wire transfer or a certified
check, immediately available funds equal to such Purchaser’s Subscription Amount as set forth on the signature page hereto
executed by such Purchaser, and the Company shall deliver to each Purchaser its respective Note, as determined pursuant to Section
2.3(a), and the Company and each Purchaser shall deliver the other items set forth in Section 2.3 deliverable at the First Closing.
Upon satisfaction of the covenants and conditions set forth in Sections 2.3 and 2.4 for each Closing, each Closing shall occur
at the offices of the Purchaser’s counsel or such other location as the parties shall mutually agree.


 


2.3
Deliveries.


 


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


 


(i)
as to the First Closing, this Agreement duly executed by the Company;


 


(ii)
a Note with a principal amount equal to such Purchaser’s Principal Amount as to the applicable Closing, registered in the
name of such Purchaser; and


 


(iii)
as to the First Closing, the Transfer Agent Instruction Letter duly executed by the Company and the Transfer Agent.


 


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


 


(i)
as to the First Closing, this Agreement duly executed by such Purchaser; and


 


(ii)
such Purchaser’s Subscription Amount as to the applicable Closing by wire transfer to the account specified in writing by
the Company.


 




    	6



    	 



    


 


2.4
Closing Conditions.


 


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


 


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


 


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


 


(iii)
the delivery by each Purchaser of the items set forth in Section 2.3(b) of this Agreement.


 


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


 


(i)
the accuracy in all material respects when made and on the applicable Closing Date of the representations and warranties of the
Company contained herein (unless as of a specific date therein);


 


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


 


(iii)
the delivery by the Company of the items set forth in Section 2.3(a) of this Agreement;


 


(iv)
there is no existing Event of Default (as defined in the Notes) and no existing event which, with the passage of time or the giving
of notice, would constitute an Event of Default;


 


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


 


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


 




    	7



    	 



    


 


ARTICLE
III. 


REPRESENTATIONS
AND WARRANTIES 


 


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


 


(a)
Subsidiaries. All of the direct and indirect subsidiaries of the Company are set forth on Schedule 3.1(a). The Company owns, directly
or indirectly, all of the capital stock or other equity interests of each Subsidiary free and clear of any Liens, and all of the
issued and outstanding shares of capital stock of each Subsidiary are validly issued and are fully paid, non-assessable and free
of preemptive and similar rights to subscribe for or purchase securities. If the Company has no subsidiaries, all other references
to the Subsidiaries or any of them in the Transaction Documents shall be disregarded.


 


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


 


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


 




    	8



    	 



    


 


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


 


(e)
Filings, Consents and Approvals. The Company is not required to obtain any consent, waiver, authorization or order of, give any
notice to, or make any filing or registration with, any court or other federal, state, local or other governmental authority or
other Person in connection with the execution, delivery and performance by the Company of the Transaction Documents, other than:
(i) the filings required pursuant to Section 4.6 of this Agreement, (ii) the notice and/or application(s) to each applicable Trading
Market for the issuance and sale of the Securities and the listing of the Conversion Shares for trading thereon in the time and
manner required thereby and (iii) the filing of Form D with the Commission and such filings as are required to be made under applicable
state securities laws (collectively, the “Required Approvals”).


 


(f)
Issuance of the Securities. The Securities are duly authorized and, when issued and paid for in accordance with the applicable
Transaction Documents, will be duly and validly issued, fully paid and nonassessable, free and clear of all Liens imposed by the
Company other than restrictions on transfer provided for in the Transaction Documents. The Underlying Shares, when issued in accordance
with the terms of the Transaction Documents, will be validly issued, fully paid and nonassessable, free and clear of all Liens
imposed by the Company other than restrictions on transfer provided for in the Transaction Documents. By June 1, 2015, the Company
will reserve from its duly authorized capital stock a number of shares of Common Stock for issuance of the Underlying Shares at
least equal to 250% of the Required Minimum on the date hereof.


 




    	9



    	 



    


 


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


 




    	10



    	 



    


 


(h)
SEC Reports; Financial Statements. Except as set forth on Schedule 3.1(g), the Company has filed all reports, schedules, forms,
statements and other documents required to be filed by the Company under the Securities Act and the Exchange Act, including pursuant
to Section 13(a) or 15(d) thereof, for the two years preceding the date hereof (or such shorter period as the Company was required
by law or regulation to file such material) (the foregoing materials, including the exhibits thereto and documents incorporated
by reference therein, being collectively referred to herein as the “SEC Reports”). As of their respective dates, the
SEC Reports complied in all material respects with the requirements of the Securities Act and the Exchange Act, as applicable,
and none of the SEC Reports, when filed, contained any untrue statement of a material fact or omitted to state a material fact
required to be stated therein or necessary in order to make the statements therein, in the light of the circumstances under which
they were made, not misleading. The Company is not now or has not in the last year been an issuer subject to Rule 144(i) under
the Securities Act. The financial statements of the Company included in the SEC Reports comply in all material respects with applicable
or accounting requirements and the rules and regulations of the Commission with respect thereto as in effect at the time of filing.
Such financial statements have been prepared in accordance with United States generally accepted accounting principles applied
on a consistent basis during the periods involved (“GAAP”), except as may be otherwise specified in such financial
statements or the notes thereto and except that unaudited financial statements may not contain all footnotes required by GAAP,
and fairly present in all material respects the financial position of the Company and its consolidated Subsidiaries as of and
for the dates thereof and the results of operations and cash flows for the periods then ended, subject, in the case of unaudited
statements, to normal, immaterial, year-end audit adjustments.


 


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


 


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


 




    	11



    	 



    


 


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


 


(l)
Compliance. Except as disclosed in Schedule 3.1(l), neither the Company nor any Subsidiary: (i) is in default under or in violation
of (and no event has occurred that has not been waived that, with notice or lapse of time or both, would result in a default by
the Company or any Subsidiary under), nor has the Company or any Subsidiary received notice of a claim that it is in default under
or that it is in violation of, any indenture, loan or credit agreement or any other agreement or instrument to which it is a party
or by which it or any of its properties is bound (whether or not such default or violation has been waived), (ii) is in violation
of any judgment, decree or order of any court, arbitrator or other governmental authority or (iii) is or has been in violation
of any statute, rule, ordinance or regulation of any governmental authority, including without limitation all foreign, federal,
state and local laws relating to taxes, environmental protection, occupational health and safety, product quality and safety and
employment and labor matters, except in each case as could not have or reasonably be expected to result in a Material Adverse
Effect.


 




    	12



    	 



    


 


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


 


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


 


(o)
Intellectual Property. The Company and the Subsidiaries have, or have rights to use, all patents, patent applications, trademarks,
trademark applications, service marks, trade names, trade secrets, inventions, copyrights, licenses and other intellectual property
rights and similar rights as described in the SEC Reports as necessary or required for use in connection with their respective
businesses and which the failure to so have could have a Material Adverse Effect (collectively, the “Intellectual Property
Rights”). None of, and neither the Company nor any Subsidiary has received a notice (written or otherwise) that any of,
the Intellectual Property Rights has expired, terminated or been abandoned, or is expected to expire or terminate or be abandoned,
within two (2) years from the date of this Agreement. Neither the Company nor any Subsidiary has received, since the date of the
latest audited financial statements included within the SEC Reports, a written notice of a claim or otherwise has any knowledge
that the Intellectual Property Rights violate or infringe upon the rights of any Person, except as could not have or reasonably
be expected to not have a Material Adverse Effect. To the knowledge of the Company, all such Intellectual Property Rights are
enforceable and there is no existing infringement by another Person of any of the Intellectual Property Rights. The Company and
its Subsidiaries have taken reasonable security measures to protect the secrecy, confidentiality and value of all of their intellectual
properties, except where failure to do so could not, individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect.


 




    	13



    	 



    


 


(p)
Transactions with Affiliates and Employees. Except as set forth in the SEC Reports, none of the officers or directors of the Company
or any Subsidiary and, to the knowledge of the Company, none of the employees of the Company or any Subsidiary is presently a
party to any transaction with the Company or any Subsidiary (other than for services as employees, officers and directors), including
any contract, agreement or other arrangement providing for the furnishing of services to or by, providing for rental of real or
personal property to or from providing for the borrowing of money from or lending of money to, or otherwise requiring payments
to or from any officer, director or such employee or, to the knowledge of the Company, any entity in which any officer, director,
or any such employee has a substantial interest or is an officer, director, trustee, stockholder, member or partner, in each case
in excess of $100,000 other than for: (i) payment of salary or consulting fees for services rendered; (ii) reimbursement for expenses
incurred on behalf of the Company; and (iii) other employee benefits, including stock option agreements under any stock option
plan of the Company.


 


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


 




    	14



    	 



    


 


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


 


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


 


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


 


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


 


(v)
Listing and Maintenance Requirements. The Common Stock is registered pursuant to Section 12(b) or 12(g) of the Exchange Act, and
the Company has taken no action designed to, or which to its knowledge is likely to have the effect of, terminating the registration
of the Common Stock under the Exchange Act nor has the Company received any notification that the Commission is contemplating
terminating such registration. The Company has not, in the twelve (12) months preceding the date hereof, received notice from
any Trading Market on which the Common Stock is or has been listed or quoted to the effect that the Company is not in compliance
with the listing or maintenance requirements of such Trading Market. The Company is, and has no reason to believe that it will
not in the foreseeable future continue to be, in compliance with all such listing and maintenance requirements.


 


(w)
Application of Takeover Protections. The Company and the Board of Directors have taken all necessary action, if any, in order
to render inapplicable any control share acquisition, business combination, poison pill (including any distribution under a rights
agreement) or other similar anti-takeover provision under the Company’s certificate of incorporation (or similar charter
documents) or the laws of its state of incorporation that is or could become applicable to the Purchasers as a result of the Purchasers
and the Company fulfilling their obligations or exercising their rights under the Transaction Documents, including without limitation
as a result of the Company’s issuance of the Securities and the Purchasers’ ownership of the Securities.


 




    	15



    	 



    


 


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


 


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


 


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


 


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


 




    	16



    	 



    


 


(bb)
Accountants. The Company’s accounting firm is set forth on Schedule 3.1(bb) of the Disclosure Schedules. To the knowledge
and belief of the Company, such accounting firm is a registered public accounting firm as required by the Exchange Act.


 


(cc)
No Disagreements with Accountants and Lawyers. Except as set forth in Schedule 3.1(cc), there are no disagreements of any kind
presently existing, or reasonably anticipated by the Company to arise, between the Company and the accountants and lawyers formerly
or presently employed by the Company and the Company is current with respect to any fees owed to its accountants and lawyers which
could affect the Company’s ability to perform any of its obligations under any of the Transaction Documents.


 


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


 


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


 


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


 




    	17



    	 



    


 


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


 


(hh)
U.S. Real Property Holding Corporation. The Company is not and has never been a U.S. real property holding corporation within
the meaning of Section 897 of the Internal Revenue Code of 1986, as amended, and the Company shall so certify upon Purchaser’s
request.


 


(ii)
Bank Holding Company Act. Neither the Company nor any of its Subsidiaries or Affiliates 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 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.


 


(jj)
Solvency. The Company’s financial condition is as set forth
in the Company’s financial statements filed with the Commission. The Company does not intend to incur debts beyond its ability
to pay such debts as they mature (taking into account the timing and amounts of cash to be payable on or in respect of its debt).
The Company has no knowledge of any facts or circumstances which lead it to believe that it will file for reorganization or liquidation
under the bankruptcy or reorganization laws of any jurisdiction within one year from the applicable Closing Date. Schedule 3.1(aa)
sets forth as of the date hereof all outstanding secured and unsecured Indebtedness of the Company or any Subsidiary, or for which
the Company or any Subsidiary has commitments. For the purposes of this Agreement, “Indebtedness” means (x) any liabilities
for borrowed money or amounts owed in excess of $50,000 (other than trade accounts payable incurred in the ordinary course of
business), (y) all guaranties, endorsements and other contingent obligations in respect of indebtedness of others, whether or
not the same are or should be reflected in the Company’s consolidated balance sheet (or the notes thereto), except guaranties
by endorsement of negotiable instruments for deposit or collection or similar transactions in the ordinary course of business;
and (z) the present value of any lease payments in excess of $50,000 due under leases required to be capitalized in accordance
with GAAP. Neither the Company nor any Subsidiary is in default with respect to any Indebtedness.


 




    	18



    	 



    


 


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


 


(ll)
Seniority. As of each Closing Date, no Indebtedness or other claim against the Company is senior to the Notes in right of payment,
whether with respect to interest or upon liquidation or dissolution, or otherwise, other than indebtedness secured by purchase
money security interests (which is senior only as to underlying assets covered thereby) and capital lease obligations (which is
senior only as to the property covered thereby).


 


(mm) Acknowledgment
Regarding Purchaser’s Trading Activity. Anything in this Agreement or elsewhere herein to the contrary notwithstanding
(except for Sections 3.2(f) and 4.12 hereof), it is understood and acknowledged by the Company that: (i) the Purchaser has
not been asked by the Company to agree, nor has the Purchaser agreed, to desist from purchasing or selling, long and/or
short, securities of the Company, or “derivative” securities based on securities issued by the Company or to hold
the Securities for any specified term; (ii) past or future open market or other transactions by the Purchaser, specifically
including, without limitation, Short Sales or “derivative” transactions, before or after the closing of this or
future private placement transactions, may negatively impact the market price of the Company’s publicly-traded
securities; (iii) the Purchaser, and counter-parties in “derivative” transactions to which the Purchaser is a
party, directly or indirectly, may presently have a “short” position in the Common Stock; and (iv) each Purchaser
shall not be deemed to have any affiliation with or control over any arm’s length counter-party in any
“derivative” transaction. The Company further understands and acknowledges that (y) one or more Purchasers
may engage in hedging activities at various times during the period that the Securities are outstanding, including, without
limitation, during the periods that the value of the Underlying Shares deliverable with respect to Securities are being
determined, and (z) such hedging activities (if any) could reduce the value of the existing stockholders’
equity interests in the Company at and after the time that the hedging activities are being conducted. The Company
acknowledges that such aforementioned hedging activities do not constitute a breach of any of the Transaction
Documents.


 


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


 




    	19



    	 



    


 


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


 


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


 


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


 


(c)
Purchaser Status. At the time such Purchaser was offered the Securities, it was, and as of the date hereof it is, and on each
date on which it converts any Notes it will be an “accredited investor” as defined in Rule 501(a)(1), (a)(2), (a)(3),
(a)(7) or (a)(8) under the Securities Act.


 




    	20



    	 



    


 


 


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


 


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


 


(f)
Certain Transactions and Confidentiality. Other than consummating the transactions contemplated hereunder, such Purchaser has
not directly or indirectly, nor has any Person acting on behalf of or pursuant to any understanding with such Purchaser, executed
any purchases or sales, including Short Sales, of the securities of the Company during the period commencing as of the time that
such Purchaser first received a term sheet (written or oral) from the Company or any other Person representing the Company setting
forth the material terms of the transactions contemplated hereunder and ending immediately prior to the execution hereof. Notwithstanding
the foregoing, in the case of a Purchaser that is a multi-managed investment vehicle whereby separate portfolio managers manage
separate portions of such Purchaser’s assets and the portfolio managers have no direct knowledge of the investment decisions
made by the portfolio managers managing other portions of such Purchaser’s assets, the representation set forth above shall
only apply with respect to the portion of assets managed by the portfolio manager that made the investment decision to purchase
the Securities covered by this Agreement. Other than to other Persons party to this Agreement, such Purchaser has maintained the
confidentiality of all disclosures made to it in connection with this transaction (including the existence and terms of this transaction).
Notwithstanding the foregoing, for avoidance of doubt, nothing contained herein shall constitute a representation or warranty,
or preclude any actions, with respect to the identification of the availability of, or securing of, available shares to borrow
in order to effect Short Sales or similar transactions in the future.


 


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


 




    	21



    	 



    


 


ARTICLE
IV. 


OTHER
AGREEMENTS OF THE PARTIES 


 


4.1
Transfer Restrictions.


 


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


 


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


 


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


 


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


 




    	22



    	 



    


 


(c)
Certificates evidencing the Underlying Shares shall not contain any legend (including the legend set forth in Section 4.1(b) hereof):
(i) while a registration statement covering the resale of such security is effective under the Securities Act; (ii) following
any sale of such Underlying Shares pursuant to Rule 144; (iii); or (iii) if such legend is not required under applicable requirements
of the Securities Act (including judicial interpretations and pronouncements issued by the staff of the Commission). The
Company shall cause its counsel to issue a legal opinion to the Transfer Agent promptly after any of the events described in (i)-(iii)
in the preceding sentence if required by the Transfer Agent to effect the removal of the legend hereunder (with a copy to the
applicable Purchaser and its broker). If all or any portion of a Note is converted at a
time when there is an effective registration statement to cover the resale of the Underlying Shares, or if such Underlying Shares
may be sold under Rule 144 or if such legend is not otherwise required under applicable requirements of the Securities Act (including
judicial interpretations and pronouncements issued by the staff of the Commission) then such Underlying Shares shall be issued
free of all legends. The Company agrees that following the Effective Date or at such time as such legend is no longer required
under this Section 4.1(c), it will, no later than two Trading Days following the delivery by a Purchaser to the Company or the
Transfer Agent of a certificate representing Underlying Shares, as applicable, issued with a restrictive legend (such third Trading
Day, the “Legend Removal Date”), deliver or cause to be delivered to such Purchaser a certificate representing such
shares that is free from all restrictive and other legends. The Company may not make any notation on its records or give instructions
to the Transfer Agent that enlarge the restrictions on transfer set forth in this Section 4. Certificates for Underlying Shares
subject to legend removal hereunder shall be transmitted by the Transfer Agent to the Purchaser by crediting the account of the
Purchaser’s prime broker with the Depository Trust Company System as directed by such Purchaser.


 


(d)
In addition to such Purchaser’s other available remedies, the Company shall pay to a Purchaser, in cash, as partial liquidated
damages and not as a penalty, $1,000 per Trading Day for each Trading Day after the Legend Removal Date until such certificate
is delivered without a legend. Nothing herein shall limit such Purchaser’s right to pursue actual damages for the Company’s
failure to deliver certificates representing any Securities as required by the Transaction Documents, and such Purchaser shall
have the right to pursue all remedies available to it at law or in equity including, without limitation, a decree of specific
performance and/or injunctive relief.


 


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


 




    	23



    	 



    


 


4.3
Furnishing of Information; Public Information.


 


(a)
If the Common Stock is not registered under Section 12(b) or 12(g) of the Exchange Act on the date hereof, the Company agrees
to cause the Common Stock to be registered under Section 12(g) of the Exchange Act on or before the 60th calendar day
following the date hereof. Until the earliest of the time that no Purchaser owns Securities, the Company covenants to maintain
the registration of the Common Stock under Section 12(b) or 12(g) of the Exchange Act and to timely file (or obtain extensions
in respect thereof and file within the applicable grace period) all reports required to be filed by the Company after the date
hereof pursuant to the Exchange Act even if the Company is not then subject to the reporting requirements of the Exchange Act.


 


(b)
At any time during the period commencing from the six (6) month anniversary of the date hereof and ending at such time that all
of the Securities may be sold without the requirement for the Company to be in compliance with Rule 144(c)(1) and otherwise without
restriction or limitation pursuant to Rule 144, if the Company shall fail for any reason to satisfy the current public information
requirement under Rule 144(c) (a “Public Information Failure”) then, in addition to such Purchaser’s other available
remedies, the Company shall pay to a Purchaser, in cash, as partial liquidated damages and not as a penalty, by reason of any
such delay in or reduction of its ability to sell the Securities, an amount in cash equal to two percent (2.0%) of the aggregate
Subscription Amount of such Purchaser’s Securities on the day of a Public Information Failure and on every thirtieth (30th
day (pro rated for periods totaling less than thirty days) thereafter until the earlier of (a) the date such Public Information
Failure is cured and (b) such time that such public information is no longer required for the Purchasers to transfer the Underlying
Shares pursuant to Rule 144. The payments to which a Purchaser shall be entitled pursuant to this Section 4.3(b) are referred
to herein as “Public Information Failure Payments.” Public Information Failure Payments shall be paid on the earlier
of (i) the last day of the calendar month during which such Public Information Failure Payments are incurred and (ii) the third
(3rd Business Day after the event or failure giving rise to the Public Information Failure Payments is cured. In the
event the Company fails to make Public Information Failure Payments in a timely manner, such Public Information Failure Payments
shall bear interest at the rate of 1.5% per month (prorated for partial months) until paid in full. Nothing herein shall limit
such Purchaser’s right to pursue actual damages for the Public Information Failure, and such Purchaser shall have the right
to pursue all remedies available to it at law or in equity including, without limitation, a decree of specific performance and/or
injunctive relief. 


 


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


 




    	24



    	 



    


 


4.5
Conversion and Exercise Procedures. The form of Notice of Conversion included in the Notes sets forth the totality of the procedures
required of the Purchasers in order to convert the Notes. Without limiting the preceding sentences, no ink-original Notice of
Conversion shall be required, nor shall any medallion guarantee (or other type of guarantee or notarization) of any Notice of
Conversion form be required in order to convert the Note. No additional legal opinion, other information or instructions shall
be required of the Purchasers to convert their Notes. The Company shall honor conversions of the Notes and shall deliver Underlying
Shares in accordance with the terms, conditions and time periods set forth in the Transaction Documents.


 


4.6
Shareholder Rights Plan. No claim will be made or enforced by the Company or, with the consent of the Company, any other Person,
that any Purchaser is an “Acquiring Person” under any control share acquisition, business combination, poison pill
(including any distribution under a rights agreement) or similar anti-takeover plan or arrangement in effect or hereafter adopted
by the Company, or that any Purchaser could be deemed to trigger the provisions of any such plan or arrangement, by virtue of
receiving Securities under the Transaction Documents or under any other agreement between the Company and the Purchasers.


 


4.7
Non-Public Information. Except with respect to the material terms and conditions of the transactions contemplated by the Transaction
Documents, the Company covenants and agrees that neither it, nor any other Person acting on its behalf, will provide any Purchaser
or its agents or counsel with any information that the Company believes constitutes material non-public information, unless prior
thereto such Purchaser shall have entered into a written agreement with the Company regarding the confidentiality and use of such
information. The Company understands and confirms that each Purchaser shall be relying on the foregoing covenant in effecting
transactions in securities of the Company.


 


4.8
Use of Proceeds. The Company shall use the net proceeds hereunder at its sole discretion.


 


4.9
Indemnification of Purchasers. Subject to the provisions of this Section 4.10, the Company will indemnify and hold each Purchaser
and its directors, officers, shareholders, members, partners, employees and agents (and any other Persons with a functionally
equivalent role of a Person holding such titles notwithstanding a lack of such title or any other title), each Person who controls
such Purchaser (within the meaning of Section 15 of the Securities Act and Section 20 of the Exchange Act), and the directors,
officers, shareholders, agents, members, partners or employees (and any other Persons with a functionally equivalent role of a
Person holding such titles notwithstanding a lack of such title or any other title) of such controlling persons (each, a “Purchaser
Party”) harmless from any and all losses, liabilities, obligations, claims, contingencies, damages, costs and expenses,
including all judgments, amounts paid in settlements, court costs and reasonable attorneys’ fees and costs of investigation
that any such Purchaser Party may suffer or incur as a result of or relating to (a) any breach by the Company of any of the representations,
warranties, covenants or agreements made by the Company in this Agreement or in the other Transaction Documents or (b) any action
instituted against the Purchaser Parties in any capacity, or any of them or their respective Affiliates, by any stockholder of
the Company who is not an Affiliate of such Purchaser Party, with respect to any of the transactions contemplated by the Transaction
Documents (unless such action is based upon a breach of such Purchaser Party’s representations, warranties or covenants
under the Transaction Documents or any agreements or understandings such Purchaser Party may have with any such stockholder or
any violations by such Purchaser Party of state or federal securities laws or any conduct by such Purchaser Party which constitutes
fraud, gross negligence, willful misconduct or malfeasance). If any action shall be brought against any Purchaser Party in respect
of which indemnity may be sought pursuant to this Agreement, such Purchaser Party shall promptly notify the Company in writing,
and the Company shall have the right to assume the defense thereof with counsel of its own choosing reasonably acceptable to the
Purchaser Party. Any Purchaser Party shall have the right to employ separate counsel in any such action and participate in the
defense thereof, but the fees and expenses of such counsel shall be at the expense of such Purchaser Party except to the extent
that (i) the employment thereof has been specifically authorized by the Company in writing, (ii) the Company has failed after
a reasonable period of time to assume such defense and to employ counsel or (iii) in such action there is, in the reasonable opinion
of counsel, a material conflict on any material issue between the position of the Company and the position of such Purchaser Party,
in which case the Company shall be responsible for the reasonable fees and expenses of no more than one such separate counsel.
The Company will not be liable to any Purchaser Party under this Agreement (y) for any settlement by a Purchaser Party effected
without the Company’s prior written consent, which shall not be unreasonably withheld or delayed; or (z) to the extent,
but only to the extent that a loss, claim, damage or liability is attributable to any Purchaser Party’s breach of any of
the representations, warranties, covenants or agreements made by such Purchaser Party in this Agreement or in the other Transaction
Documents. The indemnification required by this Section 4.10 shall be made by periodic payments of the amount thereof during the
course of the investigation or defense, as and when bills are received or are incurred. The indemnity agreements contained herein
shall be in addition to any cause of action or similar right of any Purchaser Party against the Company or others and any liabilities
the Company may be subject to pursuant to law.


 




    	25



    	 



    


 


4.10
Reservation and Listing of Securities.


 


(a)
The Company shall maintain a reserve from its duly authorized shares of Common Stock for issuance pursuant to the Transaction
Documents in such amount as may then be required to fulfill its obligations in full under the Transaction Documents.


 


(b)
If, on any date, the number of authorized but unissued (and otherwise unreserved) shares of Common Stock is less than 250% of
the Required Minimum on such date, then the Board of Directors shall use commercially reasonable efforts to amend the Company’s
certificate or articles of incorporation to increase the number of authorized but unissued shares of Common Stock to at least
250% of the Required Minimum at such time, as soon as possible and in any event not later than the 60th day after such
date.


 


(c)
The Company shall, if applicable: (i) in the time and manner required by the principal Trading Market, prepare and file with such
Trading Market an additional shares listing application covering a number of shares of Common Stock at least equal to the Required
Minimum on the date of such application; (ii) take all steps necessary to cause such shares of Common Stock to be approved for
listing or quotation on such Trading Market as soon as possible thereafter; (iii) provide to the Purchasers evidence of such listing
or quotation; and (iv) maintain the listing or quotation of such Common Stock on any date at least equal to the Required Minimum
on such date on such Trading Market or another Trading Market.


 


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


 


4.12
Certain Transactions and Confidentiality. Each Purchaser, severally and not jointly with the other Purchasers, covenants that
neither it, nor any Affiliate acting on its behalf or pursuant to any understanding with it will execute any Short Sales, of any
of the Company’s securities during the period commencing with the execution of this Agreement and ending on the later of
(i) the Maturity Date or (ii) the date that the Notes are no longer outstanding (provided that this provision shall not prohibit
any sales made where a corresponding Notice of Conversion is tendered to the Company and the shares received upon such conversion
or exercise are used to close out such sale). 


 


4.13
Right of First Refusal.


 


(a)
From the date hereof until the date that is the 12-month anniversary
of the last Closing, upon any issuance by the Company of Common Stock, Common Stock Equivalents or debt for cash consideration,
Indebtedness or a combination of units thereof (a “Subsequent Financing”), the Purchaser shall have the right to participate
in up to an amount of the Subsequent Financing equal to 100% of the Subsequent Financing on the same terms, conditions and price
provided for in the Subsequent Financing.


 


(b)
At least four (4) Trading Days prior to the closing of the Subsequent
Financing, the Company shall deliver to the Purchaser a written notice of its intention to effect a Subsequent Financing (“Pre-Notice”),
which Pre-Notice shall ask the Purchaser if it wants to review the details of such financing (such additional notice, a “Subsequent
Financing Notice”). Upon the request of the Purchaser, and only upon a request by the Purchaser, for a Subsequent Financing
Notice, the Company shall promptly, but no later than one (1) Trading Day after such request, deliver a Subsequent Financing Notice
to the Purchaser. The Subsequent Financing Notice shall describe in reasonable detail the proposed terms of such Subsequent Financing,
the amount of proceeds intended to be raised thereunder and the Person or Persons through or with whom such Subsequent Financing
is proposed to be effected and shall include a term sheet or similar document relating thereto as an attachment.


 




    	26



    	 



    


 


(c)
If the Purchaser desires to participate in such Subsequent Financing,
the Purchaser must provide written notice to the Company that the Purchaser is willing to participate in the Subsequent Financing,
the amount of the Purchaser’s participation, and representing and warranting that the Purchaser has such funds ready, willing,
and available for investment on the terms set forth in the Subsequent Financing Notice.


 


(d)
If notifications by the Purchaser of its willingness to participate
in the Subsequent Financing (or to cause their designees to participate) is, in the aggregate, less than the total amount of the
Subsequent Financing, then the Company may effect the remaining portion of such Subsequent Financing on the terms and with the
Persons set forth in the Subsequent Financing Notice.


 


(e)
The Company must provide the Purchaser with a second Subsequent
Financing Notice, and the Purchaser will again have the right of participation set forth above in this Section 4.13, if the Subsequent
Financing subject to the initial Subsequent Financing Notice is not consummated for any reason on the terms set forth in such
Subsequent Financing Notice within thirty (30) Trading Days after the date of the initial Subsequent Financing Notice.


 


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


 


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


 


(h)
Notwithstanding the foregoing, this Section 4.13 shall not apply
in respect of an Exempt Issuance.


 




    	27



    	 



    


 


4.14
Securities Laws Disclosure; Publicity. The Company shall (a) by
9:30 a.m. (New York City time) on the Trading Day immediately following the date hereof, issue a press release disclosing the
material terms of the transactions contemplated hereby, and (b) file a Current Report on Form 8-K, including the Transaction Documents
as exhibits thereto, with the Commission within the time required by the Exchange Act. From and after the issuance of such press
release, the Company represents to the Purchaser that it shall have publicly disclosed all material, non-public information delivered
to any of the Purchasers by the Company or any of its Subsidiaries, or any of their respective officers, directors, employees
or agents in connection with the transactions contemplated by the Transaction Documents. The Company and the Purchaser shall consult
with each other in issuing any other press releases with respect to the transactions contemplated hereby, and neither the Company
nor the Purchaser shall issue any such press release nor otherwise make any such public statement without the prior consent of
the Company, with respect to any press release of the Purchaser, or without the prior consent of the Purchaser, with respect to
any press release of the Company, which consent shall not unreasonably be withheld or delayed, except if such disclosure is required
by law, in which case the disclosing party shall promptly provide the other party with prior notice of such public statement or
communication. Notwithstanding the foregoing, the Company shall not publicly disclose the name of the Purchaser, or include the
name of the Purchaser in any filing with the Commission or any regulatory agency or Trading Market, without the prior written
consent of the Purchaser, except: (a) as required by federal securities law in connection with any registration statement contemplated
by this Agreement and (b) to the extent such disclosure is required by law or Trading Market regulations, in which case the Company
shall provide the Purchaser with prior notice of such disclosure permitted under this clause (b).


 


4.15
Form D; Blue Sky Filings. The Company agrees to timely file a Form D with respect to the Securities as required under Regulation
D and to provide a copy thereof, promptly upon request of the Purchaser. The Company shall take such action as the Company shall
reasonably determine is necessary in order to obtain an exemption for, or to qualify the Securities for, sale to the Purchaser
at the applicable Closing under applicable securities or “Blue Sky” laws of the states of the United States, and shall
provide evidence of such actions promptly upon request of the Purchaser.


 


4.16
Further Financing Restrictions. During the period commencing on the date hereof and for so long as any Principal Amount of the
Notes remain outstanding, neither the Company nor any of its affiliates or Subsidiaries, nor any of its or their respective officers,
employees, directors, agents or other representatives, will, without the prior written consent of the Purchaser (which consent
may be withheld, delayed or conditioned in the Purchaser’s sole discretion), directly or indirectly: (a) solicit, initiate,
encourage or accept any other inquiries, proposals or offers from any Person (other than the Purchaser) relating to any exchange
(i) of any security of the Company or any of its Subsidiaries for any other security of the Company or any of its Subsidiaries,
except to the extent (x) consummated pursuant to an exchange registered under a registration statement of the Company filed pursuant
to the 1933 Act and declared effective by the Commission or (y) such exchange is
exempt from registration pursuant to an exemption provided under the 1933 Act (other
than Section 3(a)(10) of the 1933 Act) or (ii) of any indebtedness or other securities
of, or claim against, the Company or any of its Subsidiaries relying on the exemption provided by Section
3(a)(10) of the 1933 Act (any such transaction described in clauses (i) or (ii), an “Exchange Transaction”);
(b) enter into, effect, alter, amend, announce or recommend to its stockholders any Exchange Transaction with any Person (other
than the Purchaser); or (c) participate in any discussions, conversations, negotiations or other communications with any Person
(other than the Purchaser) regarding any Exchange Transaction, or furnish to any Person (other than the Purchaser) any information
with respect to any Exchange Transaction, or otherwise cooperate in any way, assist or participate in, facilitate or encourage
any effort or attempt by any Person (other than the Purchaser) to seek an Exchange Transaction involving the Company or any of
its Subsidiaries. Notwithstanding the foregoing or anything contained herein to the contrary,
for so long as any Principal on the Note remains outstanding, neither the Company nor any of its affiliates or Subsidiaries,
nor any of its or their respective officers, employees, directors, agents or other representatives, will, without the prior written
consent of the Purchaser (which consent may be withheld, delayed or conditioned in the Purchaser’s sole discretion), directly
or indirectly, cooperate in any way, assist or participate in, facilitate or encourage any effort or attempt by any Person (other
than the Purchaser) to effect any acquisition of securities or indebtedness of, or claim
against, the Company by such Person from an existing holder of such securities, indebtedness or claim in connection with a proposed
exchange of such securities or indebtedness of, or claim against, the Company (whether pursuant to Section 3(a)(9) or 3(a)(10)
of the 1933 Act or otherwise) (a “Third Party Exchange Transfer”). The Company, its affiliates and Subsidiaries,
and each of its and their respective officers, employees, directors, agents or other representatives shall immediately cease and
cause to be terminated all existing discussions, conversations, negotiations and other communications with any Persons (other
than the Purchaser) with respect to any of the foregoing. The Company shall promptly (and in no event later than 24 hours after
receipt) notify (which notice shall be provided orally and in writing and shall identify the Person making the inquiry, request,
proposal or offer and set forth the material terms thereof) the Purchaser after receipt of any inquiry, request, proposal or offer
relating to any Exchange Transaction or Third Party Exchange Transfer, and shall promptly (and in no event later than 24 hours
after receipt) provide copies to the Purchaser of any written inquiries, requests, proposals or offers relating thereto. The Company
agrees that it and its affiliates and Subsidiaries, and each of its and their respective officers, employees, directors, agents
or other representatives Subsidiaries will not enter into any agreement with any Person subsequent to the date hereof which prohibits
the Company from providing any information to the Purchaser in accordance with this provision. For all purposes of this Agreement,
violations of the restrictions set forth in this Section 4.16 by any Subsidiary or affiliate of the Company, or any officer, employee,
director, agent or other representative of the Company or any of its Subsidiaries or affiliates shall be deemed a direct breach
of this Section 4.16 by the Company.


 




    	28



    	 



    


 


ARTICLE
V. 


MISCELLANEOUS



 


5.1
Termination. This Agreement may be terminated by any Purchaser, as to such Purchaser’s obligations hereunder only and without
any effect whatsoever on the obligations between the Company and the other Purchasers, by written notice to the other parties,
if the First Closing has not been consummated on or before May 18, 2015; provided, however, that such termination will not affect
the right of any party to sue for any breach by any other party (or parties).


 


5.2
Fees and Expenses. The Company shall deliver to each Purchaser, prior to each Closing, a completed and executed copy of the Closing
Statement, attached hereto as Annex A. Except as expressly set forth in the Transaction Documents to the contrary, each party
shall pay the fees and expenses of its advisers, counsel, accountants and other experts, if any, and all other expenses incurred
by such party incident to the negotiation, preparation, execution, delivery and performance of this Agreement. At
the First Closing, the Company shall pay the Purchaser $2,500 for its legal fees. The Company
shall pay all Transfer Agent fees (including, without limitation, any fees required for same-day processing of any instruction
letter delivered by the Company and any conversion or exercise notice delivered by a Purchaser), stamp taxes and other taxes and
duties levied in connection with the delivery of any Securities to the Purchasers.


 


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


 


5.4
Notices. Any and all notices or other communications or deliveries required or permitted to be provided hereunder shall be in
writing and shall be deemed given and effective on the earliest of: (i) the date of transmission, if such notice or communication
is delivered via facsimile at the facsimile number set forth on the signature pages attached hereto at or prior to 12:00 p.m.
(New York City time) on a Trading Day; (ii) the next Trading Day after the date of transmission, if such notice or communication
is delivered via facsimile at the facsimile number set forth on the signature pages attached hereto on a day that is not a Trading
Day or later than 12:00 p.m. (New York City time) on any Trading Day; (iii) the second (2nd) Trading Day following
the date of mailing, if sent by U.S. nationally recognized overnight courier service; or (iv) upon actual receipt by the party
to whom such notice is required to be given. The address for such notices and communications shall be as set forth on the signature
pages attached hereto.


 


5.5
Amendments; Waivers. No provision of this Agreement may be waived, modified, supplemented or amended except in a written instrument
signed, in the case of an amendment, by the Company and the Purchasers holding at least 67% in interest of the Securities then
outstanding or, in the case of a waiver, by the party against whom enforcement of any such waived provision is sought. No waiver
of any default with respect to any provision, condition or requirement of this Agreement shall be deemed to be a continuing waiver
in the future or a waiver of any subsequent default or a waiver of any other provision, condition or requirement hereof, nor shall
any delay or omission of any party to exercise any right hereunder in any manner impair the exercise of any such right.


 




    	29



    	 



    


 


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


 


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


 


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


 


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


 




    	30



    	 



    


 


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


 


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


 


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


 


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


 


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


 


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


 




    	31



    	 



    


 


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


 


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


 


5.18
Independent Nature of Purchasers’ Obligations and Rights. The obligations of each Purchaser under any Transaction Document
are several and not joint with the obligations of any other Purchaser, and no Purchaser shall be responsible in any way for the
performance or non-performance of the obligations of any other Purchaser under any Transaction Document. Nothing contained herein
or in any other Transaction Document, and no action taken by any Purchaser pursuant hereto or thereto, shall be deemed to constitute
the Purchasers as a partnership, an association, a joint venture or any other kind of entity, or create a presumption that the
Purchasers are in any way acting in concert or as a group with respect to such obligations or the transactions contemplated by
the Transaction Documents. Each Purchaser shall be entitled to independently protect and enforce its rights, including, without
limitation, the rights arising out of this Agreement or out of the other Transaction Documents, and it shall not be necessary
for any other Purchaser to be joined as an additional party in any proceeding for such purpose. Each Purchaser has been represented
by its own separate legal counsel in its review and negotiation of the Transaction Documents.


 




    	32



    	 



    


 


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


 


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


 


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


 


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


 


(Signature
Pages Follow) 


 




    	33



    	 



    


 


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


 


	OSL Holdings Inc. 	 	Address
    for Notice:
	 	 	 	 
	By:
    	 	 	Fax:
	Name:
	 	 	 
	Title:
	 	 	 


 


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


 


[REMAINDER
OF PAGE INTENTIONALLY LEFT BLANK 


SIGNATURE
PAGE FOR PURCHASER FOLLOWS] 


 




    	34



    	 



    


 


[PURCHASER
SIGNATURE PAGES TO SECURITIES PURCHASE AGREEMENT] 


 


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


 


Name
of Purchaser:


 





Signature
of Authorized Signatory of Purchaser: ____________________________________ 


 


Name
of Authorized Signatory: ____________________________________ 


 


Title
of Authorized Signatory: ____________________________________ 


 


Email
Address of Authorized Signatory: ____________________________________ 


 


Facsimile
Number of Authorized Signatory: ____________________________________ 


 


Address
for Notice to Purchaser: 


 


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


 


First
Closing Principal Amount: $150,000


 


First
Closing Subscription Amount: 


 


Second
Closing Principal Amount: $100,000


 


Second
Closing Subscription Amount: 


 


EIN
Number: _______________________ 


 






    	 



    	 



    

 


Annex
A 


 


CLOSING
STATEMENT


 


Pursuant
to the attached Securities Purchase Agreement, dated as of the date hereto, the purchasers shall purchase Notes from OSL Holdings
Inc. (the “Company”). All funds will be wired into an account
maintained by the Company. All funds will be disbursed in accordance with this Closing Statement.


 


Disbursement
Date:May __, 2015


 





 


	I.
        PURCHASE PRICE

        
	 	 
	Gross
    Proceeds to be Received 	 	$150,000
	 	 	 
	II.
        DISBURSEMENTS

        
	 	 
	Purchaser’s
    legal fees	 	$2,500
	 	 	$
	 	 	$
	 	 	$
	 	 	$
	 	 	 
	Total
    Amount Disbursed:	 	$2,500
	 	 	 
	WIRE
    INSTRUCTIONS:	 	 
	 	 	 


 


Duly executed
this __ day of May, 2015:


 


	OSL Holdings Inc.	 
	 	 	 
	By:
    	 	 
	Name:
    	 	 
	Title: