Exhibit 10.1


 


SECURITIES
PURCHASE AGREEMENT


 


This
Securities Purchase Agreement (this “Agreement”) is dated as of June 30, 2020, by and between Innovative Payment Solutions,
Inc., a Nevada corporation (the “Company”), and each lender party that executes the signature page hereto as a purchaser
(each, a “Purchaser” and collectively, the “Purchasers”).


 


WHEREAS,
subject to the terms and conditions set forth in this Agreement and pursuant to an exemption from the registration requirements
of Section 5 of the Securities Act, as defined, contained in Section 4(a)(2) thereof and/or Rule 506(b) thereunder, the Company
desires to issue and sell to the Purchaser, and the Purchaser 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 the Purchaser agree as follows:


 


ARTICLE
I.

DEFINITIONS


 


1.1
Definitions. In addition to the words and terms defined elsewhere in this Agreement, for all purposes of this Agreement,
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 4.5.


 


“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.


 


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


 


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


 


“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.


 






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“Company
Counsel” means Gracin & Marlow LLP.


 


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


 


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


 


“Exempt
Issuance” means the issuance of (a) shares of Common Stock, restricted stock units or options, and the underlying shares
of Common Stock to consultants, employees, officers or directors of the Company pursuant to any stock or option plan duly adopted
for such purpose, by a majority of the non-employee members of the Board of Directors or a majority of the members of a committee
of non-employee directors established for such purpose for services rendered to the Company, (b) securities issued upon the exercise
or exchange of or conversion of any Securities issued hereunder and/or other securities issuable pursuant to existing agreements,
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 (other than in connection with stock
dividends, stock splits or combinations) or to extend the term of such securities, (c) securities issued pursuant, acquisitions
or strategic transactions approved by a majority of the directors of the Company, provided that any such issuance shall only be
to a Person (or to the equity holders of a Person) which is, itself or through its subsidiaries, an operating company or an owner
of an asset in a business synergistic with the business of the Company and which shall reasonably be expected to provide to the
Company additional benefits, but shall not include a transaction in which the Company is issuing securities primarily for the
purpose of raising capital or to an entity whose primary business is investing in securities, (d) securities issued pursuant to
any purchase money equipment loan or capital leasing arrangement, purchasing agent or debt financing from a commercial bank or
similar financial institution, (e) securities issued pursuant to any presently outstanding warrants or this Agreement; and (f)
securities upon a stock split, stock dividend or subdivision of the Common Stock and shares of common stock in a public offering;
(g) non-convertible loans from traditional commercials banks with interest per annum not to exceed 12% which will rank pari
passu with the Notes issued to investors by the Company.


 


“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).


 


“Initial
Subscription Amount” means 50% of the Subscription Amount.


 


“Intellectual
Property” means all of the following in any jurisdiction throughout the world: (a) all inventions (whether patentable or
unpatentable and whether or not reduced to practice), all improvements thereto, and all U.S. and foreign patents, patent applications,
and patent disclosures, together with all reissuances, continuations, continuations-in-part, revisions, extensions, and reexaminations
thereof, (b) all trademarks, service marks, brand names, certification marks, trade dress, logos, trade names, domain names, assumed
names and corporate names, together with all colorable imitations thereof, and including all goodwill associated therewith, and
all applications, registrations, and renewals in connection therewith, (c) all copyrights, and all applications, registrations,
and renewals in connection therewith, (d) all trade secrets under applicable state laws and the common law and know-how (including
formulas, techniques, technical data, designs, drawings, specifications, customer and supplier lists, pricing and cost information,
and business and marketing plans and proposals), (e) all computer software (including source code, object code, diagrams, data
and related documentation), and (f) all copies and tangible embodiments of the foregoing (in whatever form or medium).


 






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“Lead
Investor” means Cavalry Fund I LP.


 


“Licensed
Intellectual Property Agreement” means all licenses, sublicenses, agreements and permissions (each as amended to date) that
any third party owns and that the Company uses, including off-the-shelf software purchased or licensed by the Company.


 


“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).


 


“Notes”
means the Original Issue Discount Senior Secured Convertible Promissory Notes issued to the Purchaser, in the form of Exhibit
A attached hereto.


 


“Note
Conversion Price” means $0.035 per share, subject to adjustment as provided in the Note.


 


“Original
Issue Date” means the date of the first issuance of the Notes, regardless of any transfers of any Note and regardless of
the number of instruments which may be issued to evidence such Notes.


 


“Participation
Maximum” shall have the meaning ascribed to such term in Section 4.11(a).


 


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


 


“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.


 


“Purchaser
Party” shall have the meaning ascribed to such term in Section 4.8.


 


“Regulation
FD” means Regulation FD promulgated by the SEC pursuant to the Exchange Act, as such Regulation may be amended or interpreted
from time to time, or any similar rule or regulation hereafter adopted by the SEC having substantially the same purpose and effect
as such Regulation


 


“Reserve”
shall have the meaning ascribed to such term in Section 4.9.


 






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


 


“Rule
144” means Rule 144 promulgated by the SEC 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 SEC having substantially the same purpose and effect
as such Rule.


 


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


 


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


 


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


 


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


 


“Security
Agreement” means the security agreement, in the form of Exhibit B, providing the Purchasers with a first lien on
all the assets of the Company.


 


“Shares”
means the Common Stock issuable upon conversion of the Notes.


 


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


 


“Subscription
Amount” means, as to the Purchaser, the aggregate amount to be paid for the Note purchased hereunder as specified below
the 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.


 


“Subsequent
Financing” shall have the meaning ascribed to such term in Section 4.11.


 


“Subsidiary”
means with respect to any entity at any date, any direct or indirect corporation, limited or general partnership, limited liability
company, trust, estate, association, joint venture or other business entity of which (A) more than 50% of (i) the outstanding
capital stock having (in the absence of contingencies) ordinary voting power to elect a majority of the Board of Directors or
other managing body of such entity, (ii) in the case of a partnership or limited liability company, the interest in the capital
or profits of such partnership or limited liability company or (iii) in the case of a trust, estate, association, joint venture
or other entity, the beneficial interest in such trust, estate, association or other entity business is, at the time of determination,
owned or controlled directly or indirectly through one or more intermediaries, by such entity, or (B) is under the actual control
of the Company.


 


“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 American, the Nasdaq Capital Market, the Nasdaq Global Market, the Nasdaq Global Select Market, the
New York Stock Exchange, the OTCQB, the OTCQX, or the OTC Pink Marketplace (or any successors to any of the foregoing).


 






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“Transaction
Documents” means this Agreement, the Notes, the Warrants, the Registration Rights Agreement, the Security Agreement and
any other documents or agreements executed in connection with the transactions contemplated hereunder, including, but not limited
to, the documents referenced in Section 2.3(a).


 


“Transfer
Agent” means Nevada Agency & Transfer Company, and any successor transfer agent of the Company.


 


“Variable
Rate Transaction” means any Equity Line of Credit or similar agreement, nor issue nor agree to issue any Common Stock, floating
or Variable Priced Equity Linked Instruments nor any of the foregoing or equity with price reset rights (subject to adjustment
for stock splits, distributions, dividends, recapitalizations and the like) (collectively, the “Variable Rate Transaction”).
For purposes of this Agreement, “Equity Line of Credit” shall include any transaction involving a written agreement
between the Company and an investor or underwriter whereby the Company has the right to “put” its securities to the
investor or underwriter over an agreed period of time and at an agreed price or price formula, and “Variable Priced Equity
Linked Instruments” shall include: (A) any debt or equity securities which are convertible into, exercisable or exchangeable
for, or carry the right to receive additional shares of Common Stock either (1) at any conversion, exercise or exchange rate or
other price that is based upon and/or varies with the trading prices of or quotations for Common Stock at any time after the initial
issuance of such debt or equity security, or (2) with a fixed conversion, exercise or exchange price that is subject to being
reset at some future date at any time after the initial issuance of such debt or equity security due to a change in the market
price of the Company’s Common Stock since date of initial issuance, and (B) any amortizing convertible security which amortizes
prior to its maturity date, where the Company is required or has the option to (or any investor in such transaction has the option
to require the Company to) make such amortization payments in shares of Common Stock which are valued at a price that is based
upon and/or varies with the trading prices of or quotations for Common Stock at any time after the initial issuance of such debt
or equity security (whether or not such payments in stock are subject to certain equity conditions). For purposes of determining
the total consideration for a convertible instrument (including a right to purchase equity of the Company) issued, subject to
an original issue or similar discount or which principal amount is directly or indirectly increased after issuance, the consideration
will be deemed to be the actual cash amount received by the Company in consideration of the original issuance of such convertible
instrument.


 


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


 


“Warrant
Exercise Price” means $0.05 per share.


 


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


 






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ARTICLE
II.

PURCHASE AND SALE


 


2.1
Closing. On the Closing Dates, 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 an aggregate of (i) $600,000 face value of original issue discount Notes for a total purchase
price of $525,000, and (ii) 17,142,857 Warrants, which is equal to 100% of the Shares issuable upon conversion of the Note. On
the Initial Closing Date, the Purchaser shall deliver to the Company, via wire transfer immediately available funds equal to the
Purchaser’s Initial Subscription Amount of $262,500, and the Company shall deliver to the Purchaser the Initial Note as
determined pursuant to Section 2.2(a), and the Company and the Purchaser shall deliver the other items set forth in Section 2.2
deliverable at the Initial Closing. Upon satisfaction of the covenants and conditions set forth in Sections 2.2 (a) and 2.3(b),
the Initial Closing shall occur at the offices of Company Counsel or such other location as the parties shall mutually agree.
Subject to their being no Event of Default (or a default which is not deemed an Event of Default as a result of a cure period),
within three Trading Days (the “Second Closing Date”) of a registration statement registering the Shares and Warrant
Shares being declared effective by the Staff of the SEC and the Company having increased the Reserve (as herein defined) as provided
for in Section 4.9 hereinbelow, the Purchaser shall purchase the remaining Subscription Amount and the Company and the Purchaser
shall deliver the other items set forth in Section 2.2 deliverable at the Second Closing.


 


2.2
Deliveries.


 


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


 


(i)
this Agreement duly executed by the Company;


 


(ii)
a Note in the principal amount of $262,500, convertible at the Note Conversion Price, registered in the name of the
Purchaser;


 


(iii)
an original Warrant to purchase 8,571,428 shares of Common Stock, exercisable at the Warrant Exercise Price, registered in
the name of such Purchaser;


 


(iv)
a Security Agreement providing the Purchasers with a lien on all of the assets of the Company;


 


(v)
the Registration Rights Agreement duly executed by the Company;


 


(vi)
a reservation letter executed by the Company’s Transfer Agent and the Company in the form attached as Exhibit D;
and


 


(vii)
a Board Consent approving the issuance of the Notes and the execution of the Transaction Documents on behalf of the
Company.


 






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


 


(i)
this Agreement duly executed by the Purchaser;


 


(ii)
the Registration Rights Agreement duly executed by the Purchaser; and


 


(iii)
the Purchaser’s Initial Subscription Amount by wire transfer to the Company.


 


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


 


(i)
the second Note in the principal amount of $262,500, convertible at the Note Conversion Price, registered in the name of the
Purchaser;


 


(ii)
a second original Warrant to purchase 8,571,428 shares of Common Stock, exercisable at the Warrant Exercise Price, registered
in the name of such Purchaser;


 


(iii)
a reservation letter executed by the Company’s Transfer Agent and the Company in the form attached as Exhibit D;
and


 


(iv)
a Board Consent approving the issuance of the Notes and the execution of the Transaction Documents on behalf of the
Company.


 


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


 


(i)
the Purchaser’s Second Subscription Amount by wire transfer to the Company.


 


2.3
Closing Conditions.


 


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


 


(i)
the accuracy in all material respects (or, to the extent representations or warranties are qualified by materiality or
Material Adverse Effect, in all respects) on the Closing Date of the representations and warranties of the Purchaser
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 the Purchaser required to be performed at or prior to the Closing Date shall
have been performed;


 


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


 






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


 


(i)
accuracy in all material respects (or, to the extent representations or warranties are qualified by materiality or Material
Adverse Effect, in all respects) when made and on the Closing Date of the representations and warranties of the Company
contained herein (unless as of a specific date therein in which case they shall be accurate as of such date);


 


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


 


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


 


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


 


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


 


ARTICLE
III.

REPRESENTATIONS AND WARRANTIES


 


3.1
Representations and Warranties of the Company. The Company hereby makes the following representations and warranties to
each Purchaser as of the date hereof:


 


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


 


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


 






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


 


(d) No
Conflicts. Except as set forth in Schedule 3.1(d), 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) subject to the Required
Approvals, 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, or (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 other than
the Lien of the Purchaser 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. Except as set forth on Schedule 3.1(e), 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 4.4 of this Agreement,
blue sky filings or a Form D filing(ii) application(s) to each applicable Trading Market for the listing of the Shares for
trading thereon in the time and manner required thereby, (iii) filings necessary to perfect the Liens in favor of the
Purchasers under the Security Agreement and (iv) such filings as are required to be made under applicable state securities
laws (the “Required Approvals”).


 






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(f) Issuance
of the Securities. The Securities are duly authorized and, when issued and paid for in accordance with the applicable
Transaction Documents, will be duly and validly issued, fully paid and nonassessable, free and clear of all Liens imposed by
the Company. The Shares, when issued upon conversion of the Notes will be validly issued, fully paid and nonassessable, free
and clear of all Liens imposed by the Company. The Company shall reserve from its duly authorized capital stock a number of
shares of Common Stock issuable pursuant to the Notes equal to the amount set forth in Section 4.9.


 


(g) Capitalization.
The capitalization of the Company is as set forth on Schedule 3.1. 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 awards
under the Company’s equity incentive 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 set forth on Schedule 3.1(g), 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 the capital stock of any Subsidiary, 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 or capital stock of any Subsidiary. The issuance and sale of
the Securities will not obligate the Company or any Subsidiary to issue shares of Common Stock or other securities to any
Person (other than the Purchaser) 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. There are no outstanding securities or instruments of the
Company or any Subsidiary that contain any redemption or similar provisions, and there are no contracts, commitments,
understandings or arrangements by which the Company or any Subsidiary is or may become bound to redeem a security of the
Company or such Subsidiary. The Company does not have any stock appreciation rights or “phantom stock” plans or
agreements or any similar plan or agreement. 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.


 






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(h) SEC
Reports; Financial Statements. The Company has filed all reports, schedules, forms, statements and other documents
required to be filed by the Company under the Securities Act and the Exchange Act, including pursuant to Section 13(a) or
15(d) thereof, for the two years preceding the date hereof (or such shorter period as the Company was required by law or
regulation to file such material) (the foregoing materials, including the exhibits thereto and documents incorporated by
reference therein, being collectively referred to herein as the “SEC Reports”). 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 consolidated financial statements of the Company included in
the SEC Reports, together with the related notes and schedules, present fairly, in all material respects, the consolidated
financial position of the Company and any of its Subsidiaries as of the dates indicated and the consolidated results of
operations, cash flows and changes in stockholders’ equity of the Company for the periods specified and have been
prepared in compliance with the requirements of the Securities Act and Exchange Act and in conformity with United States
generally accepted accounting principles (“GAAP”) applied on a consistent basis during the periods involved;
there are no financial statements (historical or pro forma) that are required to be included in the SEC Reports that are not
included as required; the Company and its Subsidiaries do not have any material liabilities or obligations, direct or
contingent (including any off-balance sheet obligations), not described in the SEC Reports; and all disclosures contained in
the SEC Reports, if any, regarding “non-GAAP financial measures” (as such term is defined by the rules and
regulations of the SEC) comply with Regulation G of the Exchange Act and Item 10 of Regulation S-K under the Securities Act,
to the extent applicable. The financial data set forth in each of the SEC Reports fairly presents the information set forth
therein on a basis consistent with that of the audited financial statements contained in the Company’s SEC Reports. The
interactive data in eXtensible Business Reporting Language included or incorporated by reference in the SEC Reports fairly
presents the information called for in all material respects and has been prepared in accordance with the SEC’s rules
and guidelines applicable thereto.


\


(i) Material
Changes; Undisclosed Events, Liabilities or Developments. Since the date of the latest financial statements included
within the SEC Reports (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 SEC, (iii) the Company has not altered its method of accounting, (iv) the Company has not declared or
made any dividend or distribution of cash or other property to its stockholders or purchased, redeemed or made any agreements
to purchase or redeem any shares of its capital stock and (v) the Company has not issued any equity securities to any
officer, director or Affiliate, except pursuant to existing Company equity incentive plans. The Company does not have pending
before the SEC any request for confidential treatment of information. Other than as disclosed on Schedule 3.1(i),
except for the issuance of the Securities contemplated by this Agreement, 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, prospects, 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 one Trading Day prior to the date that this representation is
made.


 






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(j) Litigation.
Except as set forth on Schedule 3.1(j), there is no action, suit, inquiry, notice of violation, proceeding or
investigation, inquiry or other similar proceeding of any federal or state government unit 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 issuance of the Securities or (ii) could, if there were an
unfavorable decision, have or reasonably be expected to result in a Material Adverse Effect. The Company has no reason to
believe that an Action will be filed against it in the future except as disclosed on Schedule 3.1(j). 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 for fraud or breach of fiduciary duty. There
has not been, and to the knowledge of the Company, there is not pending or contemplated, any investigation or inquiry by the
SEC involving the Company or any current or former director or officer of the Company. The SEC 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
Securities Act, and the Company has no reason to believe it will do so in the future.


 


(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 effort is underway to unionize or organize the employees of the Company or any Subsidiary. 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. There is no workmen’s compensation liability matter, employment-related
charge, complaint, grievance, investigation, inquiry or obligation of any kind pending, or to the Company’s knowledge,
threatened, relating to an alleged violation or breach by the Company or its Subsidiaries of any law, regulation or contract
that could, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.


 


(l) Compliance.
Except as set forth on 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.


 






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(m) Environmental
Laws. The Company and its Subsidiaries (i) are in compliance with all federal, state, local and foreign laws relating to
pollution or protection of human health or the environment (including ambient air, surface water, groundwater, land surface
or subsurface strata), including laws relating to emissions, discharges, releases or threatened releases of chemicals,
pollutants, contaminants, or toxic or hazardous substances or wastes (collectively, “Hazardous Materials”) into
the environment, or otherwise relating to the manufacture, processing, distribution, use, treatment, storage, disposal,
transport or handling of Hazardous Materials, as well as all authorizations, codes, decrees, demands, or demand letters,
injunctions, judgments, licenses, notices or notice letters, orders, permits, plans or regulations, issued, entered,
promulgated or approved thereunder (“Environmental Laws”); (ii) have received all permits licenses or other
approvals required of them under applicable Environmental Laws to conduct their respective businesses; and (iii) are in
compliance with all terms and conditions of any such permit, license or approval where in each clause (i), (ii) and
(iii), the failure to so comply could be reasonably expected to have, individually or in the aggregate, a Material Adverse
Effect.


 


(n) Regulatory
Permits. The Company and each of its Subsidiaries possess all certificates, authorizations and permits issued by the
appropriate regulatory authorities necessary to conduct their respective businesses, except where the failure to possess such
certificates, authorizations or permits would not have, individually or in the aggregate, a Material Adverse Effect, and
neither the Company nor any Subsidiary has received any notice of proceedings relating to the revocation or modification of
any such certificate, authorization or permit. There is no agreement, commitment, judgment, injunction, order or decree
binding upon the Company or any of its Subsidiaries or to which the Company or any of its Subsidiaries is a party which has
or would reasonably be expected to have the effect of prohibiting or materially impairing any business practice of the
Company or any of its Subsidiaries, any acquisition of property by the Company or any of its Subsidiaries or the conduct of
business by the Company or any of its Subsidiaries as currently conducted other than such effects, individually or in the
aggregate, which have not had and would not reasonably be expected to have a Material Adverse Effect on the Company or any of
its Subsidiaries.


 


(o) Title
to Assets. Subject to the Liens, the Company and the Subsidiaries have good and marketable title in fee simple to all
personal property owned by them that is material to the business of the Company and the Subsidiaries. The Company owns no
real property. 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.


 


(p) Intellectual
Property.


 


(i) Subject to the Liens, to the Company’s knowledge, the Company owns or possesses or has the right to use pursuant to a valid
and enforceable written license, sublicense, agreement, or permission all Intellectual Property necessary for the operation of
the business of the Company as presently conducted.


 






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(ii)
To the Company’s knowledge, the Intellectual Property does not interfere with, infringe upon, misappropriate, or otherwise
come into conflict with, any Intellectual Property rights of third parties, and the Company has no knowledge that facts exist
which indicate a likelihood of the foregoing. The Company has not received any charge, complaint, claim, demand, or notice alleging
any such interference, infringement, misappropriation, or conflict (including any claim that the Company must license or refrain
from using any Intellectual Property rights of any third party). To the knowledge of the Company, no third party has interfered
with, infringed upon, misappropriated, or otherwise come into conflict with, any Intellectual Property rights of the Company.


 


(iii)
With respect to each Licensed Intellectual Property Agreement:


 


(A)
The Licensed Intellectual Property Agreement is legal, valid, binding, enforceable, and in full force and effect;


 


(B)
To the Company’s knowledge, no party to the Licensed Intellectual Property Agreement is in breach or default, and no event
has occurred that with notice or lapse of time would constitute a breach or default or permit termination, modification, or acceleration
thereunder, which as to any such breach, default or event could have a Material Adverse Effect on the Company;


 


(C)
No party to such Licensed Intellectual Property Agreement has repudiated any provision thereof;


 


(D)
Except as set forth in such Licensed Intellectual Property Agreement, the Company has not received written or verbal notice or
otherwise has knowledge that the underlying item of Intellectual Property is subject to any outstanding injunction, judgment,
order, decree, ruling, or charge; and


 


(E)
Except as set forth on Schedule 3.1(p)(iii), the Company has not granted any sublicense or similar right with respect to
the license, sublicense, agreement, or permission.


 


(iv)
The Company has complied with and is presently in compliance with all foreign, federal, state, local, governmental (including,
but not limited to, the Federal Trade Commission and State Attorneys General), administrative, or regulatory laws, regulations,
guidelines, and rules applicable to any personal identifiable information.


 


(v) Each Person who participated in the creation, conception, invention or development of the Intellectual Property currently used
in the business of the Company (each, a “Developer”) which is not licensed from third parties has executed one or
more agreements containing industry standard confidentiality, work for hire and assignment provisions, whereby the Developer has
assigned to the Company all copyrights, patent rights, Intellectual Property rights and other rights in the Intellectual Property,
including all rights in the Intellectual Property that existed prior to the assignment of rights by such Person to the Company.


 


(vi)
Each Developer has signed a perpetual non-disclosure agreement with the Company.


 






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


 


(r) Transactions With Affiliates and Employees. Except as disclosed 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 $120,000 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 award agreements under any equity
incentive plan of the Company.


 


(s) Sarbanes-Oxley;
Internal Accounting Controls. Except as disclosed in the SEC Reports, the Company and the Subsidiaries are in compliance
with any and all applicable requirements of the Sarbanes-Oxley Act of 2002 that are effective as of the date hereof, and any
and all applicable rules and regulations promulgated by the SEC thereunder that are effective as of the date hereof and as of
the Closing Date. The Company and the Subsidiaries maintain a system of internal accounting controls as set forth in the SEC
Reports. The Company’s certifying officers have evaluated the effectiveness of the disclosure controls and procedures
of the Company and the Subsidiaries as of the end of the period covered by the most recently filed periodic report under the
Exchange Act (such date, the “Evaluation Date”). The Company presented in its most recently filed periodic report
under the Exchange Act the conclusions of the certifying officers about the effectiveness of the disclosure controls and
procedures based on their evaluations as of the Evaluation Date. Since the Evaluation Date, there have been no changes in the
internal control over financial reporting (as such term is defined in the Exchange Act) of the Company and its Subsidiaries
that have materially affected, or is reasonably likely to materially affect, the internal control over financial reporting of
the Company and its Subsidiaries.


 


(t) Certain
Fees. Except as set forth on Schedule 3.1(t), no brokerage or finder’s fees or commissions are or will be
payable by the Company or any Subsidiary to any broker, financial advisor or consultant, finder, placement agent, investment
banker, bank or other Person with respect to the transactions contemplated by the Transaction Documents. The Purchaser 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 by the Company in connection with the transactions contemplated by the
Transaction Documents.


 


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


 






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(v) Registration
Rights. Except as disclosed on Schedule 3.1(v), no Person has any right to cause the Company or any Subsidiary to
effect the registration under the Securities Act of any securities of the Company or any Subsidiary.


 


(w)
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 SEC is
contemplating terminating such registration. The Company has not, in the 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.
The Common Stock is currently eligible for electronic transfer through the Depository Trust Company or another established
clearing corporation and the Company is current in payment of the fees to the Depository Trust Company (or such other
established clearing corporation) in connection with such electronic transfer.


 


(x) 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 Purchaser as a result
of the Purchaser 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 Purchaser’s
ownership of the Securities.


 


(y) 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 the Purchaser or its agent or counsel
with any information that it believes constitutes or might constitute material, non-public information which is not otherwise
disclosed on Schedule 3.1(y). The Company understands and confirms that the Purchaser 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 Purchaser 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 press releases disseminated by the
Company during the 12 months preceding the date of this Agreement do not contain any untrue statement of a material fact or
omit to state a material fact required to be stated therein or necessary in order to make the statements therein, in light of
the circumstances under which they were made and when made, not misleading. The Company acknowledges and agrees that no
Purchaser makes or has made any representations or warranties with respect to the transactions contemplated hereby other than
those specifically set forth in Section 3.2 hereof.


 






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(z) No
Integrated Offering. Assuming the accuracy of the Purchaser’s 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 any
applicable stockholder approval provisions of any Trading Market on which any of the securities of the Company are listed or
designated.


 


(aa) Solvency.
Based on the consolidated financial condition of the Company as of the Closing Date, after giving effect to the receipt by
the Company of the proceeds from the sale of the Securities hereunder, (i) the Company’s assets do not constitute
unreasonably small capital to carry on its business as now conducted and as proposed to be conducted including its capital
needs taking into account the particular capital requirements of the business conducted by the Company, consolidated and
projected capital requirements and capital availability thereof, and (ii) the current cash flow of the Company, together with
the proceeds the Company would receive, were it to liquidate all of its assets, after taking into account all anticipated
uses of the cash, would be sufficient to pay all amounts on or in respect of its liabilities when such amounts are required
to be paid. The Company does not intend to incur debts beyond its ability to pay such debts as they mature (taking into
account the timing and amounts of cash to be payable on or in respect of its debt). The Company has no knowledge of any facts
or circumstances which lead it to believe that it will file for reorganization or liquidation under the bankruptcy or
reorganization laws of any jurisdiction within one year from the Closing Date. Schedule 3.1(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 $100,000 (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 $100,000 due under leases required to be
capitalized in accordance with GAAP. Except as set forth on Schedule 3.1(aa), neither the Company nor any Subsidiary
is in default with respect to any Indebtedness.


 


(bb) Tax
Status. The Company and each of its Subsidiaries have filed all federal, state, local and foreign tax returns which have
been required to be filed and paid all taxes shown thereon through the date hereof, to the extent that such taxes have become
due and are not being contested in good faith, except where the failure to so file or pay would not have a Material Adverse
Effect. Except as otherwise disclosed in Schedule 3.1(bb), no tax deficiency has been determined adversely to the
Company or any of its Subsidiaries which has had, or would have, individually or in the aggregate, a Material Adverse Effect.
The Company has no knowledge of any federal, state or other governmental tax deficiency, penalty or assessment which has been
or might be asserted or threatened against it which would have a Material Adverse Effect


 


(cc) 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 any provision of FCPA.


 






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(dd) Accountants.
The Company’s accounting firm is set forth in the SEC Reports. To the knowledge and belief of the Company, such
accounting firm (i) is a registered public accounting firm registered with the Public Company Accounting Oversight Board as
required by the Exchange Act and (ii) has expressed its opinion with respect to the financial statements included in the
Company’s Annual Report for the fiscal year ending December 31, 2018. 


 


(ee) Acknowledgment
Regarding Purchaser’s Purchase of Securities. The Company acknowledges and agrees that the Purchaser 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 Purchaser’s purchase of the Securities.
The Company further represents to the 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.


 


(ff)
Acknowledgement Regarding Purchaser’s Trading Activity. Notwithstanding anything in this Agreement or elsewhere to the
contrary (except for Sections 3.2(f) and 4.14 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 any
Purchaser, specifically including, without limitation, Short Sales or “derivative” transactions, before or after
the closing of this or future private placement transactions, may negatively impact the market price of the Company’s
publicly-traded securities; (iii) any Purchaser, and counter-parties in “derivative” transactions to which the
Purchaser is a party, directly or indirectly, presently may have a “short” position in the Common Stock, and (iv)
the 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) the Purchaser 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 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.


 


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


 






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(hh) Private
Placement. Assuming the accuracy of each Purchaser’s representations and warranties set forth in Section 3.1, no
registration under the Securities Act is required for the offer and sale of the Notes or the Shares issuable upon conversion
thereof by the Company to the Purchasers as contemplated hereby.


 


(ii) 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 offered the Securities for sale only to
the Purchaser and certain other “accredited investors” within the meaning of Rule 501 under the Securities
Act.


 


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


 


(kk) Notice
of Disqualification Events. The Company will notify the Purchaser in writing, prior to the Closing Date of (i) any
Disqualification Event relating to any Issuer Covered Person and (ii) any event that would, with the passage of time,
reasonably be expected to become a Disqualification Event relating to any Issuer Covered Person, in each case of which it is
aware.


 


(ll) 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”).


 


(mm) 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.


 


(nn) 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.


 






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(oo) 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 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.


 


3.2
Representations and Warranties of the Purchaser. 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. The 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
this Agreement and otherwise to carry out its obligations hereunder and thereunder. The execution and delivery of this
Agreement and performance by the Purchaser of the transactions contemplated by this Agreement have been duly authorized by
all necessary corporate, partnership, limited liability company or similar action, as applicable, on the part of the
Purchaser. Each Transaction Document to which it is a party has been duly executed by the Purchaser, and when delivered by
the Purchaser in accordance with the terms hereof, will constitute the valid and legally binding obligation of the Purchaser,
enforceable against it in accordance with its terms, except: (i) as limited by general equitable principles and applicable
bankruptcy, insolvency, reorganization, moratorium and other laws of general application affecting enforcement of
creditors’ rights generally, (ii) as limited by laws relating to the availability of specific performance, injunctive
relief or other equitable remedies and (iii) insofar as indemnification and contribution provisions may be limited by
applicable law.


 


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


 






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(c) Purchaser
Status. At the time the Purchaser was offered the Securities, it was, and as of the date hereof it is, an accredited
investor within the meaning of Rule 501 under the Securities Act. The Purchaser is not subject to any of the “Bad
Actor” disqualifications described in Rule 506(d)(1)(i) to (viii) under the Securities Act (a “Disqualification
Event”), except for a Disqualification Event covered by Rule 506(d)(2) or (d)(3).


 


(d) Experience
of the Purchaser. The 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. The 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) Access
to Information. The Purchaser acknowledges that it has had the opportunity to review the Transaction Documents (including
all exhibits and schedules thereto) and has been afforded, subject to Regulation FD, (i) the opportunity to ask such
questions as it has deemed necessary of, and to receive answers from, representatives of the Company concerning the terms and
conditions of the offering of the Securities and the merits and risks of investing in the Securities; (ii) access to
information about the Company and its financial condition, results of operations, business, properties, management and
prospects sufficient to enable it to evaluate its investment; and (iii) the opportunity to obtain such additional information
that the Company possesses or can acquire without unreasonable effort or expense that is necessary to make an informed
investment decision with respect to the investment; provided, however, that the Purchaser has not requested nor been provided
by the Company with any non-public information regarding the Company, its financial condition, results of operations,
business, properties, management and prospects. The Purchaser acknowledges and agrees that neither the Company nor anyone
else has provided the Purchaser with any information or advice with respect to the Securities nor is such information or
advice necessary or desired.


 


(f) Certain
Transactions and Confidentiality. Other than consummating the transactions contemplated hereunder, the Purchaser has not,
nor has any Person acting on behalf of or pursuant to any understanding with the Purchaser, directly or indirectly executed
any purchases or sales, including Short Sales, of the securities of the Company during the period commencing as of the time
that the 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 the Purchaser’s assets and the portfolio managers have
no direct knowledge of the investment decisions made by the portfolio managers managing other portions of the
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 or to the Purchaser’s representatives, including, without limitation, its
officers, directors, partners, legal and other advisors, employees, agents and Affiliates, the 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 this Section 3.2 shall not modify, amend or affect the 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.


 






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ARTICLE
IV.

OTHER AGREEMENTS OF THE PARTIES


 


4.1
Removal of Legends.


 


(a)
The Shares, the Warrants and Warrant Shares may only be disposed of in compliance with state and federal securities laws. In connection
with any transfer of the Shares, Warrants or Warrant Shares 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 to provide to the Company an opinion of counsel selected by the transferor and reasonably acceptable
to the Company at the cost of 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 Shares, Warrants or Warrant Shares under the
Securities Act.


 


(b)
Each Purchaser agrees to the imprinting, so long as is required by this Section 4.1, of a legend on any of the Shares, the
Warrants or Warrant Shares in the following form:


 


NEITHER
THIS SECURITY NOR THE SECURITIES INTO WHICH THIS SECURITY IS EXERCISABLE HAVE 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. THIS SECURITY AND
THE SECURITIES ISSUABLE UPON EXERCISE 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.


 


(c)
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 Shares or Warrant Shares 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 Shares or Warrant Shares 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 Shares and
Warrant Shares may reasonably request in connection with a pledge or transfer of the Shares or Warrant Shares.


 






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(d)
Certificates evidencing the Shares and the Warrant Shares (or the Transfer Agent’s records if held in book entry form)
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 securities is effective under the Securities Act (the “Effective Date”), (ii)
following any sale of such Shares or Warrant Shares pursuant to Rule 144, (iii) if such Shares or Warrant Shares are eligible
for sale under Rule 144, without the requirement for the Company to be in compliance with the current public information
required under Rule 144 as to such Shares or Warrant Shares and without volume or manner-of-sale restrictions or (iv) if such
legend is not required under applicable requirements of the Securities Act (including Sections 4(a)(1) and 4(a)(7) judicial
interpretations and pronouncements issued by the staff of the SEC). The Company shall, if any of the provisions in clause (i)
–(iv) above are applicable, at its expense, cause its counsel to issue a legal opinion to the Transfer Agent promptly
after the Effective Date if required by the Transfer Agent to effect the removal of the legend hereunder. If all or any
portion of a Note is converted or a Warrant is exercised at a time when there is an effective registration statement to cover
the resale of the Shares or the Warrant Shares, or if such Shares or Warrant Shares may be sold under Rule 144 and the
Company is then in compliance with the current public information required under Rule 144, or if the Shares or Warrant Shares
may be sold under Rule 144 without the requirement for the Company to be in compliance with the current public information
required under Rule 144 as to such Shares or Warrant Shares and without volume or manner-of-sale restrictions or if such
legend is not otherwise required under applicable requirements of the Securities Act (including Sections 4(a)(1) and 4(a)(7),
judicial interpretations and pronouncements issued by the staff of the SEC) then such Shares or Warrant Shares shall be
issued or reissued free of all legends. The Company agrees that following the effective date of any registration statement 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 restricted Shares or
Warrant Shares, as applicable, issued with a restrictive legend (such second Trading Day, the “Legend Removal
Date”), deliver or cause to be delivered to such Purchaser a certificate representing such Shares or Warrant 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 4.1. Certificates for
Shares or Warrant 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. The Company shall be responsible for any delays caused by its Transfer Agent.


 


(e)
In addition to such Purchaser’s other available remedies, (i) the Company shall pay to a Purchaser, in cash, as partial
liquidated damages and not as a penalty, for each $1,000 of the principal amount of the Notes being converted or the value of
the Warrant Shares for which a Warrant is being exercised (based on the Warrant Exercise Price), $10 per Trading Day for each
Trading Day after the Legend Removal Date (increasing to $20 per Trading Day after the fifth Trading Day) until such
certificate is delivered without a legend. Nothing herein shall limit such Purchaser’s right to pursue actual damages
for the Company’s failure to deliver certificates representing any Securities as required by the Transaction Documents,
and such Purchaser shall have the right to pursue all remedies available to it at law or in equity including, without
limitation, a decree of specific performance and/or injunctive relief, and (ii) if after the Legend Removal Date such
Purchaser purchases (in an open market transaction or otherwise) shares of Common Stock to deliver in satisfaction of a sale
by such Purchaser of all or any portion of the number of shares of Common Stock, or a sale of a number of shares of Common
Stock equal to all or any portion of the number of shares of Common Stock that such Purchaser anticipated receiving from the
Company without any restrictive legend, then, the Company shall pay to such Purchaser, in cash, an amount equal to the excess
of such Purchaser’s total purchase price (including brokerage commissions and other out-of-pocket expenses, if any) for
the shares of Common Stock so purchased (including brokerage commissions and other out-of-pocket expenses, if any) (the
“Buy-In Price”) over the product of (A) such number of Shares or Warrant
Shares that the Company was required to deliver to such Purchaser by the Legend Removal Date multiplied by (B) the highest
closing sale price of the Common Stock on any Trading Day during the period commencing on the date of the delivery by such
Purchaser to the Company of the applicable Shares or Warrant Shares (as the case may be) and ending on the date of such
delivery and payment under this Section 4.1(d).


 






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(f)
In the event a Purchaser shall request delivery of unlegended shares as described in this Section 4.1 and the Company is
required to deliver such unlegended shares, (i) it shall pay all fees and expenses associated with or required by the legend
removal and/or transfer including but not limited to legal fees, Transfer Agent fees and overnight delivery charges and
taxes, if any, imposed by any applicable government upon the issuance of Common Stock; and (ii) the Company may not refuse to
deliver unlegended shares based on any claim that such Purchaser or anyone associated or affiliated with such Purchaser has
not complied with Purchaser’s obligations under the Transaction Documents, or for any other reason, unless, an
injunction or temporary restraining order from a court, on notice, restraining and or enjoining delivery of such unlegended
shares shall have been sought and obtained by the Company and the Company has posted a surety bond for the benefit of such
Purchaser in the amount of the greater of (i) 150% of the amount of the aggregate purchase price of the Shares (based on
amount of principal and/or interest of the Note which was converted) and Warrant Shares (based on exercise price in effect
upon exercise) which is subject to the injunction or temporary restraining order, or (ii) the VWAP of the Common Stock on the
Trading Day before the issue date of the injunction multiplied by the number of unlegended shares to be subject to the
injunction, which bond shall remain in effect until the completion of the litigation of the dispute and the proceeds of which
shall be payable to such Purchaser to the extent Purchaser obtains judgment in Purchaser’s favor.


 


4.2
Furnishing of Information.


 


(a)
Until the earliest of the time that (i) no Purchaser owns Shares and Warrant Shares or (ii) the Warrants have expired, the
Company covenants to timely file (or obtain extensions in respect thereof and file within the applicable grace period) all
reports required to be filed by the Company after the date hereof pursuant to the Exchange Act even if the Company is not
then subject to the reporting requirements of the Exchange Act.


 






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(b)
At any time during the period commencing from the six month anniversary of the date hereof and ending at such time on the
earlier to occur that the Warrants are not outstanding, terminated or that all of the Warrant Shares (assuming cashless
exercise) 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 (i) shall fail for any reason to satisfy the current public
information requirement under Rule 144(c) for a period of more than 30 consecutive days or (ii) has ever been an issuer
described in Rule 144(i)(1)(i) or becomes an issuer in the future, and the Company shall fail to satisfy any condition set
forth in Rule 144(i)(2) for a period of more than 30 consecutive days (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 Shares and/or
Warrant Shares, an amount in cash equal to two percent of the aggregate Note Conversion Price of such Purchaser’s
Note(s) and/or Warrant Exercise Price of such Purchaser’s Warrants on the day of a Public Information Failure and on
every 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 Shares and/or Warrant Shares pursuant to Rule 144. 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 second Trading 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 one and one-half percent 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.


 


4.3
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(a)(1) of the Securities Act) 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 stockholder approval prior to the closing
of such other transaction unless stockholder approval is obtained before the closing of such subsequent transaction.


 


4.4
Securities Laws Disclosure; Publicity. The Company shall, by 5:30 p.m. (New York City time) on the second trading date
following the date of execution hereof, file a Current Report on Form 8-K disclosing the material terms of this Agreement, including
the Transaction Documents as exhibits thereto, with the SEC within the time required by the Exchange Act. From and after the filing
of the Form 8-K as provided in the preceding sentence, the Company represents to the Purchaser that it shall have publicly disclosed
all material, non-public information delivered to the Purchaser by the Company or any of its Subsidiaries, or any of their respective
officers, directors, employees or agents in connection with the transactions contemplated by the Transaction Documents. In addition,
effective upon the issuance of such Form 8-K, the Company acknowledges and agrees that any and all confidentiality or similar
obligations under any agreement, whether written or oral, between the Company, any of its Subsidiaries or any of their respective
officers, directors, agents, employees or Affiliates on the one hand, and the Purchaser or any of their Affiliates on the other
hand, shall terminate. The Company and the Purchaser shall consult with each other in issuing any press releases with respect
to the transactions contemplated hereby, and neither the Company nor any Purchaser shall issue any such press release nor otherwise
make any such public statement without the prior consent of the Company, with respect to any press release of any Purchaser, or
without the prior consent of 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 any Purchaser, or include the name of any Purchaser in any filing with the SEC 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 the filing of final Transaction Documents with the SEC 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).


 






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4.5
Stockholder 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 Purchaser.


 


4.6
Non-Public Information. Except with respect to the material terms and conditions of the transactions contemplated by the
Transaction Documents, which shall be disclosed pursuant to Section 4.6 and except as permitted under Section 4.11, 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 constitutes, or the Company reasonably believes constitutes, material non-public information, unless
prior thereto such Purchaser shall have consented to the receipt of such information and agreed with the Company to keep such
information confidential. Prior to providing a Purchaser with any material non-public information, the Company shall provide the
Purchaser with a consent substantially in the form attached as Exhibit E (“Consent”) which shall not include
any material non-public information. The Company shall not provide the Purchaser with the material non-public information if the
Purchaser does not execute and return the Consent to the Company. The Company understands and confirms that each Purchaser shall
be relying on the foregoing covenant in effecting transactions in securities of the Company. To the extent that the Company delivers
any material, non-public information to a Purchaser without such Purchaser’s consent, the Company hereby covenants and agrees
that such Purchaser shall not have any duty of confidentiality to the Company, any of its Subsidiaries, or any of their respective
officers, directors, agents, employees or Affiliates, not to trade on the basis of, such material, non-public information, provided
that the Purchaser shall remain subject to applicable law. To the extent that any notice provided pursuant to any Transaction
Document or any other communications made by the Company, or information provided, to the Purchaser constitutes, or contains,
material, non-public information regarding the Company or any Subsidiaries, the Company shall simultaneously file such notice
or other material information with the SEC pursuant to a Current Report on Form 8-K. The Company understands and confirms that
each Purchaser shall be relying on the foregoing covenant in effecting transactions in securities of the Company. In addition
to any other remedies provided by this Agreement or other Transaction Documents, if the Company knowingly provides any material,
non-public information to the Purchasers without their prior written consent, and it fails to immediately (no later than that
Trading Day) file a Form 8-K disclosing this material, non-public information, it shall pay the Purchasers as partial liquidated
damages and not as a penalty a sum equal to $1,000 per day for each $100,000 of each Purchaser’s Subscription Amount beginning
with the day the information is disclosed to the Purchaser and ending and including the day the Form 8-K disclosing this information
is filed.


 


4.7
Use of Proceeds. The Company shall use the net proceeds from the sale of the Securities hereunder for working capital purposes,
and shall not use such proceeds: (a) for the satisfaction of any Indebtedness as defined in the Note, (b) for the redemption of
any Common Stock or Common Stock Equivalents, (c) in violation of FCPA or OFAC regulations, or (d) to lend money, give credit,
or make advances to any officers, directors, employees or affiliates of the Company.


 






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4.8
Indemnification of Purchaser.


 


(a)
Subject to the provisions of this Section 4.8, the Company will indemnify and hold each Purchaser and its directors, officers,
stockholders, 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 the Purchaser (within the meaning
of Section 15 of the Securities Act and Section 20 of the Exchange Act), and the directors, officers, stockholders, 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 (including local counsel, if
retained) that any such Purchaser Party may suffer or incur as a result of or relating to (a) any breach of any of the representations,
warranties, covenants or agreements made by the Company in this Agreement or in the other Transaction Documents, (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 solely 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) or (c) any untrue or alleged untrue statement of a material fact contained
in any registration statement, any prospectus or any form of prospectus or in any amendment or supplement thereto or in any preliminary
prospectus, or arising out of or relating to any omission or alleged omission of a material fact required to be stated therein
or necessary to make the statements therein (in the case of any prospectus or supplement thereto, in light of the circumstances
under which they were made) not misleading. 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 (in addition to local
counsel, if retained). 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 Purchaser Parties shall have the right to settle any action against any of them by the payment
of money provided that they cannot agree to any equitable relief and the Company, its officers, directors and Affiliates receive
unconditional releases in customary form. The indemnification required by this Section 4.8 shall be made by periodic payments
of the amount thereof during the investigation or defense, as and when bills are received or are incurred. The indemnity agreements
contained herein shall be in addition to any cause of action or similar right of any Purchaser Party against the Company or others
and any liabilities the Company may be subject to pursuant to law.


 






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(b)  
Settlement Without Consent if Failure to Reimburse. If an indemnified party shall have requested an indemnifying party
to reimburse the indemnified party for reasonable fees and expenses of counsel, such indemnifying party agrees that it shall be
liable for any settlement of the nature contemplated by Section 4.8 effected without its written consent if (1) such settlement
is entered into more than 45 days after receipt by such indemnifying party of the aforesaid request, (2) such indemnifying party
shall have received notice of the terms of such settlement at least 30 days prior to such settlement being entered into and (3)
such indemnifying party shall not have reimbursed such indemnified party in accordance with such request prior to the date of
such settlement.


 


4.9
Reservation of Common Stock. Beginning on the Closing Date, until no portion of the Notes remains outstanding the Company
shall reserve and keep available at all times in favor of the Purchaser, on a pro rata basis based on the Purchasers Subscription
Amount, free of preemptive rights, five times the number of Shares issuable to the Purchasers upon conversion of the Notes and
Warrants (subject to adjustment for stock splits and dividends, combinations and similar events) (provided however, it initially
shall be 74,396,000 shares) (the “Reserve”). The Reserve amount shall thereafter be increased, on a first-priority
basis, as and when new shares become available for reserve and reduced from time to time upon any conversion of the Notes in an
amount equal to the number of Shares so issued upon such conversion(s) or increased if the Note Conversion Price is adjusted as
provided for under the Notes. The Company shall execute and cause the Transfer Agent to execute a reservation letter in the form
attached as Exhibit D.


 


4.10
Listing of Common Stock. The Company hereby agrees to use best efforts to maintain the listing or quotation of the Common
Stock on the Trading Market on which it is currently listed. The Company further agrees, if the Company applies to have the Common
Stock traded on any other Trading Market, it will then include in such application all of the Shares, and will take such other
action as is necessary to cause all of the Shares to be listed or quoted on such other Trading Market as promptly as possible.
The Company will then take all action necessary to continue the listing and trading of its Common Stock on a Trading Market and
will comply in all respects with the Company’s reporting, filing and other obligations under the bylaws or rules of the
Trading Market. The Company agrees to maintain the eligibility of the Common Stock for electronic transfer through the Depository
Trust Company or another established clearing corporation, including, without limitation, by timely payment of fees to the Depository
Trust Company or such other established clearing corporation in connection with such electronic transfer.


 






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4.11
Participation in Future Financing.


 


(a)
Except with respect to Exempt Issuances, from the earlier of (i) 24 months from this Agreement or (ii) the repayment of the Notes,
upon any issuance by the Company or any of its Subsidiaries of Common Stock or Common Stock Equivalents for cash consideration,
Indebtedness or a combination of the foregoing in a transaction exempt from registration under the Securities Act (a “Subsequent
Financing”), the Non-Insider Purchasers on a pro rata basis based on their Subscription Amount shall have the right to participate
in up to an amount of the Subsequent Financing equal to 30% of the Subsequent Financing (the “Participation Maximum”)
on the same terms, conditions and price provided for in the Subsequent Financing. At least 5 Trading Days prior to the Closing
of the Subsequent Financing, the Company shall deliver to each Purchaser a written notice of its intention to effect a Subsequent
Financing (“Pre-Notice”), which Pre-Notice shall ask such Purchaser if it wants to review the details of such financing
(such additional notice, a “Subsequent Financing Notice”). Upon the request of a Purchaser, and only upon a request
by such Purchaser, for a Subsequent Financing Notice, the Company shall promptly, but no later than one Trading Day after such
request, deliver a Subsequent Financing Notice to such 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 nature
of 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. At least two Trading Days prior to sending the Pre-Notices, the Company
shall provide the Purchasers with the Consent attached as Exhibit E. No Pre-Notices or Subsequent Financing Notices will
be sent to any Purchasers who do not return to the Company executed Consents prior to the distribution of the Pre-Notices. If
the Company prepays the Note any time prior to the 12 month anniversary of the applicable Closing Date (“12 Month Anniversary
Date”), the right of participation provided for under this Section 4.11 shall continue until the earlier of: (i) the date
of such 12 Month Anniversary Date and (ii) a Change of Control of the Company. If a Purchaser chooses to participate in the Subsequent
Financing, it may use the amount due under the applicable Purchaser’s Note as partial or full payment for the purchase price
in the Subsequent Financing.


 


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


 


(c)
If by 5:30 p.m. (New York City time) on the third Trading Day after all of the Purchasers have received the Pre-Notice, notifications
by the Purchasers of their willingness to participate in the Subsequent Financing is, in the aggregate, less than the total amount
of the Participation Maximum, 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.


 


(d)  
If by 5:30 p.m. (New York City time) on the fifth Trading Day after all of the Purchasers have received the Pre-Notice, the Company
receives responses to a Subsequent Financing Notice from Purchasers seeking to purchase more than the aggregate amount of the
Participation Maximum, each such Purchaser shall have the right to purchase its Pro Rata Portion (as defined below) of the Participation
Maximum. “Pro Rata Portion” means the ratio of (x) the Subscription Amount of Securities purchased on the Closing
Date by a Purchaser participating under this Section 4.11 and (y) the sum of the aggregate Subscription Amounts of Securities
purchased on the Closing Date by all Purchasers participating under this Section 4.11.


 


(e)
The Company must provide the Purchasers with a second Subsequent Financing Notice, and the Purchasers will again have the right
of participation set forth above in this Section 4.11, 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 30 Trading Days after
the date of the initial Subsequent Financing Notice.


 






    29


     


    

 


(f)
The Company and each Purchaser agree that if any Purchaser elects to participate in the Subsequent Financing, the transaction
documents related to the Subsequent Financing shall not include any term or provision whereby such Purchaser shall be required
to agree to any restrictions on trading as to any of the Securities purchased hereunder 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 4.11 and unless otherwise agreed to by such Purchaser, the Company shall
either confirm in writing to such Purchaser that the transaction with respect to the Subsequent Financing has been abandoned or
shall publicly disclose its intention to issue the securities in the Subsequent Financing, in either case in such a manner such
that such Purchaser will not be in possession of any material, non-public information, by 10 Trading Days following delivery of
the Subsequent Financing Notice. If by such 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 such
Purchaser, such transaction shall be deemed to have been abandoned and such Purchaser shall not be deemed to be in possession
of any material, non-public information with respect to the Company or any of its Subsidiaries.


 


(h)  
Notwithstanding the foregoing, this Section 4.11 shall not apply in respect of (i) an Exempt Issuance or (ii) after the date no
Notes are outstanding.


 


4.12
Subsequent Equity Sales. From the date hereof until 30 days after the Closing Date except for Exempt Issuances, neither
the Company nor any Subsidiary shall issue, enter into any agreement to issue or announce the issuance or proposed issuance of
any shares of Common Stock or Common Stock Equivalents.


 


4.13
Certain Transactions and Confidentiality. The Purchaser covenants that neither it nor any Affiliate acting on its behalf
or pursuant to any understanding with it will execute any purchases or sales, including Short Sales of any of the Company’s
securities during the period commencing with the execution of this Agreement and ending at such time that the transactions contemplated
by this Agreement are first publicly announced pursuant to the initial press release as described in Section 4.4. Each Purchaser
covenants that until such time as the transactions contemplated by this Agreement are publicly disclosed by the Company pursuant
to the initial press release as described in Section 4.4, the Purchaser will maintain the confidentiality of the existence and
terms of this transaction and the information included in the Disclosure Schedules. Notwithstanding the foregoing and notwithstanding
anything contained in this Agreement to the contrary, the Company expressly acknowledges and agrees that (i) no Purchaser makes
any representation, warranty or covenant hereby that it will not engage in effecting transactions in any securities of the Company
after the time that the transactions contemplated by this Agreement are first publicly announced pursuant to the initial press
release as described in Section 4.4, (ii) no Purchaser shall be restricted or prohibited from effecting any transactions in any
securities of the Company in accordance with applicable securities laws from and after the time that the transactions contemplated
by this Agreement are first publicly announced pursuant to the initial press release as described in Section 4.4 and (iii) no
Purchaser shall have any duty of confidentiality or duty not to trade in the securities of the Company to the Company or its Subsidiaries
after the issuance of the initial press release as described in Section 4.4. Notwithstanding the foregoing, in the case of a Purchaser
that is a multi-managed investment vehicle whereby separate portfolio managers manage separate portions of the Purchaser’s
assets and the portfolio managers have no direct knowledge of the investment decisions made by the portfolio managers managing
other portions of the Purchaser’s assets, the covenant set forth above shall only apply with respect to the portion of assets
managed by the portfolio manager that made the investment decision to purchase the Securities covered by this Agreement.


 






    30


     


    

 


4.14
Reserved.


 


4.15
Conversion Procedures. The forms of Conversion Notice included in the Notes set forth the totality of the procedures required
of the Purchaser to exercise the Notes. No additional legal opinion, other information or instructions shall be required of the
Purchaser to convert their Note. Without limiting the preceding sentences, no ink-original Conversion Notice shall be required,
nor shall any medallion guarantee (or other type of guarantee or notarization) of any Conversion Notice form be required to convert
the Notes. The Company shall honor conversions of the Notes and shall deliver Shares in accordance with the terms, conditions
and time periods set forth in the Transaction Documents.


 


4.16
DTC Program. For so long as any of the Notes are outstanding, the Company will employ as the Transfer Agent for the Common
Stock and Shares a participant in the Depository Trust Company Automated Securities Transfer Program and cause the Common Stock
to be transferable pursuant to such program.


 


4.17
Maintenance of Property. The Company shall keep all of its property necessary for the operations of its business, which
is necessary or useful to the conduct of its business, in good working order and condition, ordinary wear and tear excepted.


 


4.18
Collateral Agent. Each Purchaser (i) hereby appoints Cavalry Fund I LP as Collateral Agent under the Security Agreement
and (ii) acknowledges that Cavalry Fund I LP, as the Collateral Agents, owes no fiduciary duties to the Purchasers as a result
its appointment as Collateral Agent.


 


4.19
Preservation of Corporate Existence. The Company shall preserve and maintain its corporate existence, rights, privileges
and franchises in the jurisdiction of its incorporation, and qualify and remain qualified, as a foreign corporation in each jurisdiction
in which such qualification is necessary in view of its business or operations and where the failure to qualify or remain qualified
might reasonably have a Material Adverse Effect upon the financial condition, business or operations of the Company taken as a
whole.


 


4.20
No Registration of Securities on Form S-1. Other than the registration rights provided under the Registration Rights Agreement,
for the initial six months the Notes are outstanding, the Company will not file any registration statements on Form S-1. For the
avoidance of doubt, the foregoing shall not prevent the Company from filing a Registration Statement on Form S-8 with respect
to equity compensation plans.


 


4.21
Variable Rate Transactions. While any of the Notes are outstanding, the Company shall be prohibited from entering a Variable
Rate Transaction without the Lead Investor’s prior consent which may be withheld for any reason.


 






    31


     


    

 


ARTICLE
V.

MISCELLANEOUS


 


5.1
Termination. This Agreement may be terminated by the Purchaser by written notice to the other parties, if the Closing has
not been consummated on or before July 10, 2020; provided, however, that no such termination will affect the right of any party
to sue for any breach by any other party (or parties).


 


5.2
Fees and Expenses. Except as expressly set forth below and 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. 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 exercise notice delivered by a Purchaser), stamp taxes and other taxes and duties levied in connection
with the delivery of any Securities to the Purchaser. Upon the Closing, the Company agrees to pay counsel for the Lead Investor
$15,000 in non-accountable fees and up to an additional $2,500 in accountable fees, which sum may be withheld by the Lead Investor
from the Lead Investor’s Subscription Amount.


 


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: (a) the date of transmission, if such notice or communication
is delivered by email attachment at the email address as set forth on the signature pages attached hereto at or prior to 5:30
p.m. ( Eastern Standard or Daylight Savings Time, as applicable) on a Trading Day, (b) the next Trading Day after the date of
transmission, if such notice or communication is delivered via email attachment at the email address as set forth on the signature
pages attached hereto on a day that is not a Trading Day or later than 5:30 p.m. (New York City time) on any Trading Day, (c)
the second Trading Day following the date of transmission, if sent by U.S. nationally recognized overnight delivery service or
(d) 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. To the extent that any notice provided pursuant to any Transaction
Document constitutes, or contains, material, non-public information regarding the Company or any Subsidiaries, the Company shall
simultaneously file such notice with the SEC pursuant to a Current Report on Form 8-K, or which failure to do so will subject
the Company to the liquidated damages provided for in Section 5.


 


5.5
Amendments; Waivers. Except as provided in the last sentence of this Section 5.5, 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
a majority in interest of the outstanding balance of the Note 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. Any amendment effected in accordance with accordance with this Section 5.5 shall
be binding upon the Purchaser and holder of Securities and the Company.


 


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.


 






    32


     


    

 


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. Each 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 Purchaser.


 


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 4.8 and this Section 5.9.


 


5.9
Governing Law; Exclusive Jurisdiction; Attorneys’ Fees. 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, stockholders,
partners, members, employees or agents) shall be commenced exclusively in the state and federal courts sitting in the New York
County, New York. Each party hereby irrevocably submits to the exclusive jurisdiction of the state and federal courts sitting
in the New York County, New York for the adjudication of any dispute hereunder or in connection herewith or with any transaction
contemplated hereby or discussed herein (including with respect to the enforcement of any of the Transaction Documents), and hereby
irrevocably waives, and agrees not to assert in any Action or Proceeding, any claim that it is not personally subject to the jurisdiction
of any such court, that such 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 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 any party shall commence an Action or Proceeding to enforce any provisions of the Transaction Documents,
then, in addition to the obligations of the Company elsewhere in this Agreement, the prevailing party in such Action or Proceeding
shall be reimbursed by the non-prevailing party for its reasonable attorneys’ fees and other costs and expenses incurred
with the investigation, preparation and prosecution of such Action or Proceeding.


 


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


 






    33


     


    

 


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
that 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 an conversion of a Note, the Purchaser shall be required to return any Shares subject to any such
rescinded Conversion Notice concurrently with the restoration of such Purchaser’s right to acquire such shares pursuant
to the Purchaser’s Note.


 


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 without requiring the posting of any bond.


 


5.15
Remedies. In addition to being entitled to exercise all rights provided herein or granted by law, including recovery of
damages, each Purchaser 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.


 


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.


 






    34


     


    

 


5.17
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 including any action
taken by the Collateral Agent as defined by the Security Agreement (whether under this Agreement or the Security Agreement), 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. The Company has elected to provide
all Purchasers with the same terms and Transaction Documents for the convenience of the Company and not because it was required
or requested to do so by any of the Purchasers. It is expressly understood and agreed that each provision contained in this Agreement
and in each other Transaction Document is between the Company and a Purchaser, solely, and not between the Company and the Purchasers
collectively and not between and among the Purchasers.


 


5.18
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.


 


5.19
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 Trading Day, then such action may be taken or such right may be exercised on the next
succeeding Trading Day.


 


5.20
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.


 


5.21
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 waive forever trial by jury.


 


5.22
Non-Circumvention. The Company hereby covenants and agrees that the Company will not, by amendment of its Articles of Incorporation,
including any Certificates of Designation, or Bylaws or through any reorganization, transfer of assets, consolidation, merger,
scheme of arrangement, dissolution, issue or sale of securities, or any other voluntary action, avoid or seek to avoid the observance
or performance of any of the terms of this Agreement, and will at all times in good faith carry out all of the provision of this
Agreement and take all action as may be required to protect the rights of all holders of the Securities. Without limiting the
generality of the foregoing or any other provision of this Agreement or the other Transaction Documents, the Company (a) shall
not increase the par value of any Shares issuable upon conversion of the Notes above the Note Conversion Price then in effect
and (b) shall take all such action as may be necessary or appropriate in order that the Company may validly and legally issue
fully paid and nonassessable Shares upon the conversion of the Notes. Notwithstanding anything herein to the contrary, if after
180 days from the original issuance date, the Purchasers are not permitted to convert the Note, in full, for any reason, subject
to the Purchaser’s compliance with Rule 144 the Company shall use its best efforts to promptly remedy such failure, including,
without limitation, obtaining such consent or approvals as necessary to permit such conversion or exercise.


 


(Signature
Pages Follow)


 






    35


     


    

 


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.


 


	Innovative
    Payment Solutions, Inc.     	 	Address
    for Notice:
	 	
		 

	By:

        
	/s/
    William Corbett		19355
    Business Center Drive, #9
	Name:	William
    Corbett	 	Northridge,
        CA 91324

        

	Title:	Chief
    Executive Officer	 	Email:
    ___________________
	 	With
    a copy to 

(which shall not constitute notice): 	 	Gracin
        & Marlow, LLP

        1825
        Corporate Blvd, NW #110,

        

	 	 	 	Boca Raton, FL 33431 




 


[REMAINDER
OF PAGE INTENTIONALLY LEFT BLANK


SIGNATURE
PAGE FOR PURCHASER FOLLOWS]


 






    36


     


    

 


PURCHASER
SIGNATURE PAGE 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: _____Cavalry Fund I LP___________________________________


 


Signature
of Authorized Signatory of Purchaser: __/s/ Thomas Walsh________________


 


Name
of Authorized Signatory: __Thomas Walsh________________________________


 


Title
of Authorized Signatory: ____Manager______________________________________


 


Email
Address of Authorized Signatory: __ ________________


 


Facsimile
Number of Authorized Signatory: _____________--______________________


 


Address
for Notice to Purchaser:


 


61
Kinderkamack Road


Woodcliff
Lake, NJ 07677


 


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


 


____________________________________


____________________________________


 


Subscription
Amount: $__262,500________


 


EIN
Number: _______________________


 


 


 


 


 


Purchaser Signature Page




 






     


     


    

 


EXHIBIT
A


Form
of Note


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 






    Exhibit A


     


    

 


EXHIBIT
B


Form
of Security Agreement





 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 






    Exhibit B


     


    

  


EXHIBIT
C


Form
of Warrant





 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 






    Exhibit C


     


    

 


EXHIBIT
D


Form
of Reservation Letter


 


__________________________


__________________________


__________________________


__________________________


 


_____________________,
2020


 


 


Ladies
and Gentlemen:


 


Intelligent
Payment Solutions, Inc. (“Issuer” or the “Company”) a Nevada corporation and Cavalry Fund I LP
(“Investor”) have entered into a Securities Purchase Agreement dated as of _________, 2020 (the “Agreement”)
providing for the issuance of an Original Issue Discount Senior Secured Convertible Promissory Note in the principal amount of
$600,000 (the “Note”) and warrants (the “Warrants”).


 


A
copy of the forms of Note and Warrant are attached hereto. Nevada Agency & Transfer Company (“You” or the
“Transfer Agent”) should familiarize yourself with your issuance and delivery obligations, as Transfer Agent, contained
herein. The shares to be issued are to be registered in the name of the registered holder of the securities submitted for conversion
or exercise.


 


In
accordance with this Irrevocable Transfer Instruction Agreement, you are hereby irrevocably authorized and instructed to reserve
171,428,571 shares of common stock (“Common Stock”) of the Company for issuance upon conversion of the
Note and exercise of the Warrant as detailed on Schedule I. The amount of Common Stock so reserved may be increased, from time
to time, by written instructions of the Company or the Investor so long as there are sufficient authorized and unissued shares
of the Company not otherwise reserved available to do so. In addition, you are hereby directed, upon being notified by the Investor,
to increase the share reserve in accordance with the Company’s obligations under the Agreements as necessary in the event
a reduction in the conversion price of the Notes causes additional shares to become issuable. Notwithstanding anything to
the contrary in this Agreement, the Transfer Agent has no obligation to confirm the accuracy of the Conversion Notices. 


 






    Exhibit D-1


     


    

 


The
Transfer Agent is hereby irrevocably authorized and instructed to issue shares of Common Stock of the Company to the Investor,
and remove all stop-transfer instructions relating to such shares, upon your receipt from the Investor of a Conversion Notice
or Warrant exercise notice or notice by Investor’s counsel that the shares have been registered under the Securities Act
of 1933 (“1933 Act”) or otherwise may be sold pursuant to Rule 144 without any restriction, and the Company or its
counsel or Investor's counsel provides an opinion of counsel to that effect in form, substance and scope customary for opinions
of counsel in comparable transactions (and satisfactory to you), together with other documentation that may reasonably be requested,
and the number of shares to be issued are less than 9.99% of the total issued and outstanding common stock of the Company (unless
this requirement has been waived by the Company and the Investor in accordance with the Note and Warrant), such shares shall be
issued to the account of the Investor either (i) electronically by crediting the account of a Prime Broker with the Depository
Trust Company through its Deposit/Withdrawal Agent Commission system, provided that the Company has been made FAST/DRS eligible
by DTCC (DWAC), or (ii) in certificated form without any legend which would restrict the transfer of the shares, and you should
remove all stop-transfer instructions relating to such shares (such shares shall be issued from the reserve, but in the event
there are insufficient reserve shares of Common Stock to accommodate a Conversion Notice, the Transfer Agent and the Company agree
that the Conversion Notice should be completed using authorized but unissued shares of Common Stock that the Company has in its
treasury that are not otherwise reserved). If the shares of Common Stock are eligible to be electronically delivered via DWAC
((i) above), the shares of Common Stock shall be delivered in that manner. The Transfer Agent is not responsible for the accuracy
set forth in the Conversion Notice. Until such time as you are advised by the Investor or Company counsel as above that the shares
have been registered under the 1933 Act or otherwise may be sold pursuant to Rule 144 without any restriction, you are hereby
instructed to place the following legend on the certificates:


 


THE
SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED. THE SECURITIES
MAY NOT BE SOLD, TRANSFERRED OR ASSIGNED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT FOR THE SECURITIES UNDER SAID ACT,
OR AN OPINION OF COUNSEL IN FORM, SUBSTANCE AND SCOPE CUSTOMARY FOR OPINIONS OF COUNSEL IN COMPARABLE TRANSACTIONS, THAT REGISTRATION
IS NOT REQUIRED OR UNLESS SOLD PURSUANT TO RULE 144 UNDER SAID ACT.


 


The
ability to convert the Notes and exercise the Warrants in a timely manner is a material obligation of the Company pursuant to
the Notes and Warrants. The Company hereby requests that the Transfer Agent act promptly, without unreasonable delay and without
the need for any action or confirmation by the Company with respect to the issuance of Common Stock pursuant to any Conversion
Notices received from the Investor. The Transfer Agent will not delay in processing any Conversion Notices owing to the fact that
the Company is in arrears of its fees and other monies owed to the Transfer Agent, provided that each time a Conversion Notice
is delivered to the Transfer Agent, the Investor agrees to pay the cost of processing each Conversion Notice at a sum not to exceed
$300.00 (the “Investor Conversion Payment”) and the Investor shall seek Company reimbursement.


 






    Exhibit D-2


     


    

 


The
Company shall indemnify you and your officers, directors, principals, partners, agents and representatives, and hold each of them
harmless from and against any and all loss, liability, damage, claim or expense (including the reasonable fees and disbursements
of its attorneys) incurred by or asserted against you or any of them arising out of or in connection with the instructions set
forth herein, the performance of your duties hereunder and otherwise in respect hereof, including the costs and expenses of defending
yourself or themselves against any claim or liability hereunder, including claims that may be asserted by the Company, except
that the Company shall not be liable hereunder as to matters in respect of which it is determined that you have acted with gross
negligence or in bad faith. You shall have no liability to the Company in respect to any action taken or any failure to act in
respect of this if such action was taken or omitted to be taken in good faith, and you shall be entitled to rely in this regard
on the advice of counsel.


 


The
Board of Directors of the Company has approved this Irrevocable Transfer Instruction Agreement including the irrevocable instructions
and does hereby extend the Company's irrevocable agreement to indemnify the Transfer Agent for all loss, liability or expense
in carrying out the authority and direction herein contained on the terms herein set forth.


 


All
processing fees will be expected and payable upon receipt of the request from the presenter of such request. The Company and Investor
understand and agree that the Transfer Agent’s fee schedule is subject to change and the Company agrees to pay the full
amount of any such conversion according to the Transfer Agent fee schedule then in force. The Transfer Agent agrees not to increase
the Investor Conversion Payment.


 


The
Company agrees that the Transfer Agent may resign as the Company’s transfer agent. In that event, or in the event that the
Company terminates you, you reserve the right to and may complete any issuance or transfer requests then pending. The Company
shall engage a suitable replacement transfer agent that will agree to serve as transfer agent for the Company and be bound by
the terms and conditions of these Irrevocable Instructions within five business days. In the event that the Company decides to
terminate the Transfer Agent, 30 days’ notice of termination must be given prior to termination. The Transfer Agent shall
abide by the obligations under this Agreement during the 30 day termination period.


 


The
Company hereby authorizes the issuance of such number of shares under the terms of the Note and Warrants and any such shares shall
be considered fully paid and non-assessable at the time of their issuance. The Company and the Investor agree that you will be
notified in writing by the Company and the Investor when the Note has been fully converted and if there are any remaining shares
in the reservation that are to be released and returned to the Company’s authorized shares.


 


The
Investor and Company expressly understand and agree that nothing in this Irrevocable Transfer Instruction Agreement shall require
or be construed in any way to require the Transfer Agent, in its sole discretion, to do, take or not do or take any action that
would be contrary to any court order, any Federal or State law, rule, or regulation including but expressly not limited to both
the 1933 Act and the Securities Exchange Act of 1934 as amended, the rules and regulations promulgated thereunder by the Securities
and Exchange Commission, or the transfer agent agreement with the Company.


 






    Exhibit D-3


     


    

 


The
Company hereby directs you, upon request by the Investor to immediately provide any capitalization structure information pertaining
to the number of common shares of the Company that are issued and outstanding and the amount reserved for the Investor without
any further action or confirmation by the Company.


 


The
Investor is intended to be and is a third party beneficiary hereof, and no amendment or modification to the instructions set forth
herein may be made without the consent of the Investor.


 


Intelligent
Payment Solutions, Inc.


 


_________________________________


________________________________


 


Nevada
Agency & Transfer Company


 


_________________________________


________________________________


 


Acknowledged
and Agreed:


 


______________________


 


By:
________________________________


 






    Exhibit D-4


     


    

 


Schedule
I


 


$600,000
Principal


14,142,857
Warrants


 






    Exhibit D-5


     


    

 





EXHIBIT
E 


Form
of Consent


 


Innovative
Payment Solutions, Inc. (the “Company”) has information or notice of a proposed event (collectively, the “Information”)
that it is either required to provide you pursuant to that certain Securities Purchase Agreement dated June 30, 2020  (“Agreement”)
between you and the Company or believes that you would be interested in obtaining.


 


If
the Company is required to provide this Information to you under the Agreement, you acknowledge that receipt
of this information may restrict you from trading in the Company’s securities until this Information is made public in accordance
with the Agreement.


 


If
the Company is not required to provide this Information to you under the Agreement, you acknowledge that
this may restrict you from trading in the Company’s securities until this Information is made public in accordance with
the Agreement. Provided, however, if the Company does not immediately file a Form 8-K publicly disclosing this Information, you
shall be entitled to remedies under the Agreement including liquidated damages under Section 4.6.


 


Please
respond in writing if you do or do not want to be provided with the Information. If the Company does not receive your response
within three business days, we will have the right to assume that you have chosen not to receive the Information and, if applicable,
waived your right to any piggyback registration rights, subsequent offering rights and any other rights provided for under the
Agreements that require notice, for which this Information (including notice) is being given.


 


Please
sign below and check the appropriate box below.


  


	 	Sincerely,
	 	 
	 	Innovative
    Payment Solutions, Inc.
	 	 	 
	 	By:	 
	 	Name: 	 
	 	Title:	Chief
    Executive Officer


 


___
Yes. Please provide we with the Information


 


___
No. Do not provide me with the Information


 


__________________________


__________________________


 


 


Exhibit
E