Document:

Exhibit 10.3

 

SECURITY AGREEMENT

 

This SECURITY AGREEMENT, dated
as of November 14, 2022 (this “Agreement”), among Auddia Inc., a Delaware corporation (the “Company”),
any subsidiary and affiliate of the Company that is a signatory hereto either now or joined in the future (such subsidiaries, the “Guarantors”
and, together with the Company, the “Debtors”) and the holders of the Secured Notes (as defined below), and their endorsees,
transferees and assigns (collectively, the “Secured Party”).

 

W I T N E S S E T H:

 

WHEREAS, the Secured Party
has agreed to fund the Company with respect to the issuance of those certain Senior Secured Bridge Notes, dated as of the date hereof,
subject to the terms therein, issued by the Company to the Secured Party (the “Secured
Notes”); 

 

WHEREAS, the Guarantors (if
and when any come into existence) would guarantee and act as surety for payment of such Secured Notes pursuant to a certain subsidiary
guarantee (the “Guarantee”); and

 

WHEREAS, in order to induce
the Secured Party to extend the loan evidenced by the Secured Notes, each Debtor has agreed to execute and deliver to the Secured Party
this Agreement and to grant the Secured Party a security interest in certain property of such Debtor to secure the prompt payment, performance
and discharge in full of all of the Company’s obligations under the Secured Notes and the Guarantors’ obligations under the
Guarantee.

 

NOW, THEREFORE, in consideration
of the agreements herein contained and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged,
the parties hereto hereby agree as follows:

 

1.       Certain
Definitions. As used in this Agreement, the following terms shall have the meanings set forth in this Section 1. Terms used but not
otherwise defined in this Agreement that are defined in Article 9 of the UCC (such as “account”, “chattel paper”,
“commercial tort claim”, “deposit account”, “document”, “equipment”, “fixtures”,
“general intangibles”, “goods”, “instruments”, “inventory”, “investment property”,
“letter-of-credit rights”, “proceeds” and “supporting obligations”) shall have the respective meanings
given such terms in Article 9 of the UCC.

 

(a)       “Collateral”
means the collateral in which the Secured Party is granted a security interest by this Agreement and which shall include all of the assets
of the Debtors, including the following personal property of the Debtors, whether presently owned or existing or hereafter acquired or
coming into existence, wherever situated, and all additions and accessions thereto and all substitutions and replacements thereof, and
all proceeds, products and accounts thereof, including, without limitation, all proceeds from the sale or transfer of the Collateral and
of insurance covering the same and of any tort claims in connection therewith, and all dividends, interest, cash, notes, securities, equity
interest or other property at any time and from time to time acquired, receivable or otherwise distributed in respect of, or in exchange
for, any or all of the Pledged Securities (as defined below):

 

(i)          All
goods, including, without limitation, (A) all machinery, equipment, computers, motor vehicles, trucks, tanks, boats, ships, appliances,
furniture, special and general tools, fixtures, test and quality control devices and other equipment of every kind and nature and wherever
situated, together with all documents of title and documents representing the same, all additions and accessions thereto, replacements
therefor, all parts therefor, and all substitutes for any of the foregoing and all other items used and useful in connection with any
Debtor’s businesses and all improvements thereto; and (B) all inventory;

 

(ii)        All
contract rights and other general intangibles, including, without limitation, all partnership interests, membership interests, stock or
other securities, rights under any of the Organizational Documents, agreements related to the Pledged Securities, licenses, distribution
and other agreements, computer software (whether “off-the-shelf”, licensed from any third party or developed by any Debtor),
computer software development rights, leases, franchises, customer lists, quality control procedures, grants and rights, goodwill, Intellectual
Property and income tax refunds;

 

(iii)       All
accounts, together with all instruments, all documents of title representing any of the foregoing, all rights in any merchandising, goods,
equipment, motor vehicles and trucks which any of the same may represent, and all right, title, security and guaranties with respect to
each account, including any right of stoppage in transit;

 

(iv)       All
documents, letter-of-credit rights, instruments and chattel paper;

 

(v)        All
commercial tort claims;

 

(vi)       All
deposit accounts and all cash (whether or not deposited in such deposit accounts);

 

 

 

 

 

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(vii)      All
investment property;

 

(viii)     All supporting obligations;

 

(ix)       All
files, records, books of account, business papers, and computer programs; and

 

(x)        the
products and proceeds of all of the foregoing Collateral set forth in clauses (i)-(ix) above.

 

Without limiting the generality
of the foregoing, the “Collateral” shall include all investment property and general intangibles respecting ownership
and/or other equity interests in each Guarantor, including, without limitation, the shares of capital stock and the other equity interests
listed on Schedule H hereto (as the same may be modified from time to time pursuant to the terms hereof), and any other shares
of capital stock and/or other equity interests of any other direct or indirect majority owned subsidiary of any Debtor obtained in the
future, and, in each case, all certificates representing such shares and/or equity interests and, in each case, all rights, options, warrants,
stock, other securities and/or equity interests that may hereafter be received, receivable or distributed in respect of, or exchanged
for, any of the foregoing and all rights arising under or in connection with the Pledged Securities, including, but not limited to, all
dividends, interest and cash.

 

Notwithstanding the foregoing,
nothing herein shall be deemed to constitute an assignment of any asset which, in the event of an assignment, becomes void by operation
of applicable law or the assignment of which is otherwise prohibited by applicable law (in each case to the extent that such applicable
law is not overridden by Sections 9-406, 9-407 and/or 9-408 of the UCC or other similar applicable law); provided, however,
that, to the extent permitted by applicable law, this Agreement shall create a valid security interest in such asset and, to the extent
permitted by applicable law, this Agreement shall create a valid security interest in the proceeds of such asset.

 

(b)       “Intellectual
Property” means the collective reference to all rights, priorities and privileges relating to intellectual property, whether
arising under United States, multinational or foreign laws or otherwise, including, without limitation, (i) all copyrights arising under
the laws of the United States, any other country or any political subdivision thereof, whether registered or unregistered and whether
published or unpublished, all registrations and recordings thereof, and all applications in connection therewith, including, without limitation,
all registrations, recordings and applications in the United States Copyright Office, (ii) all letters patent of the United States, any
other country or any political subdivision thereof, all reissues and extensions thereof, and all applications for letters patent of the
United States or any other country and all divisions, continuations and continuations-in-part thereof, (iii) all trademarks, trade names,
corporate names, company names, business names, fictitious business names, trade dress, service marks, logos, domain names and other source
or business identifiers, and all goodwill associated therewith, now existing or hereafter adopted or acquired, all registrations and recordings
thereof, and all applications in connection therewith, whether in the United States Patent and Trademark Office or in any similar office
or agency of the United States, any State thereof or any other country or any political subdivision thereof, or otherwise, and all common
law rights related thereto, (iv) all trade secrets arising under the laws of the United States, any other country or any political subdivision
thereof, (v) all rights to obtain any reissues, renewals or extensions of the foregoing, (vi) all licenses for any of the foregoing, and
(vii) all causes of action for infringement of the foregoing.

 

(c)       “Majority
in Interest” means, at any time of determination, the majority in interest (based on then-outstanding principal amounts of Secured
Notes at the time of such determination) of the Secured Party.

 

(d)       “Necessary
Endorsement” means undated stock powers endorsed in blank or other proper instruments of assignment duly executed and such other
instruments or documents as the Secured Party may reasonably request.

 

 

 

 

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(e)       “Obligations”
means all of the liabilities and obligations (primary, secondary, direct, contingent, sole, joint or several) due or to become due, or
that are now or may be hereafter contracted or acquired, or owing to, of any Debtor to the Secured Party, including, without limitation,
all obligations under this Agreement, the Secured Notes, and any other instruments, agreements or other documents executed and/or delivered
in connection herewith or therewith, in each case, whether now or hereafter existing, voluntary or involuntary, direct or indirect, absolute
or contingent, liquidated or unliquidated, whether or not jointly owed with others, and whether or not from time to time decreased or
extinguished and later increased, created or incurred, and all or any portion of such obligations or liabilities that are paid, to the
extent all or any part of such payment is avoided or recovered directly or indirectly from any of the Secured Party as a preference, fraudulent
transfer or otherwise as such obligations may be amended, supplemented, converted, extended or modified from time to time. Without limiting
the generality of the foregoing, the term “Obligations” shall include, without limitation: (i) principal of, interest, and
any other amounts owed on the Secured Notes as set forth in the Secured Notes; (ii) any and all other fees, indemnities, costs, obligations
and liabilities of the Debtors from time to time under or in connection with this Agreement, the Secured Notes and any other instruments,
agreements or other documents executed and/or delivered in connection herewith or therewith; and (iii) all amounts (including but not
limited to post-petition interest) in respect of the foregoing that would be payable but for the fact that the obligations to pay such
amounts are unenforceable or not allowable due to the existence of a bankruptcy, reorganization or similar proceeding involving any Debtor.

 

(f)       “Organizational
Documents” means, with respect to any Debtor, the documents by which such Debtor was organized (such as articles of incorporation,
certificate of incorporation, certificate of limited partnership or articles of organization, and including, without limitation, any certificates
of designation for preferred stock or other forms of preferred equity) and which relate to the internal governance of such Debtor (such
as bylaws, a partnership agreement or an operating, limited liability or members agreement).

 

(g)       “Permitted
Liens” means the following:

 

(i)         Liens
imposed by law for taxes that are not yet due or are being contested in good faith, which in each case, have been appropriately reserved
for;

 

(ii)        Carriers’,
warehousemen’s, mechanics’, materialmen’s, repairmen’s and other like Liens imposed by law, arising in the ordinary
course of business and securing obligations that are not overdue by more than thirty (30) days or are being contested in good faith;

 

(iii)       Pledges
and deposits made in the ordinary course of business in compliance with workers’ compensation, unemployment insurance and other
social security laws or regulations;

 

(iv)       Deposits
to secure the performance of bids, trade contracts, leases, statutory obligations, surety and appeal bonds, performance bonds and other
obligations of a like nature, in each case in the ordinary course of business;

 

(v)        Liens
under this Agreement; and

 

(vi)       Any
other liens in favor of the Secured Party.

 

(h)       “Pledged
Interests” shall have the meaning ascribed to such term in Section 4(j).

 

(i)       “Pledged
Securities” shall have the meaning ascribed to such term in Section 4(i).

 

(j)       “UCC”
means the Uniform Commercial Code of the State of Delaware and any other applicable law of any state or states that has jurisdiction with
respect to all, or any portion of, the Collateral or this Agreement, from time to time. It is the intent of the parties that defined terms
in the UCC should be construed in their broadest sense so that the term “Collateral” will be construed in its broadest sense.
Accordingly, if there are, from time to time, changes to defined terms in the UCC that broaden the definitions, they are incorporated
herein and if existing definitions in the UCC are broader than the amended definitions, the existing ones shall be controlling.

 

2.       Grant
of Security Interest in Collateral. As an inducement for the Secured Party to fund the Company and to secure the complete and timely
payment, performance and discharge in full, as the case may be, of all of the Obligations, each Debtor hereby unconditionally and irrevocably
pledges, grants and hypothecates to the Secured Party a perfected, first priority security interest in and to, a lien upon and a right
of set-off against all of their respective right, title and interest of whatsoever kind and nature in and to, the Collateral (a “Security
Interest” and, collectively, the “Security Interests”).

 

 

 

 

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3.       Delivery
of Certain Collateral. Contemporaneously or prior to the execution of this Agreement, each Debtor shall deliver or cause to be delivered
to the Secured Party (a) any and all certificates and other instruments representing or evidencing the Pledged Securities, and (b) any
and all certificates and other instruments or documents representing any of the other Collateral, in each case, together with all Necessary
Endorsements. The Debtors are, contemporaneously with the execution hereof, delivering to Secured Party, or have previously delivered
to Secured Party, a true and correct copy of each Organizational Document governing any of the Pledged Securities.

 

4.       Representations,
Warranties, Covenants and Agreements of the Debtors. Except as set forth under the corresponding Section of the disclosure schedules
delivered to the Secured Party concurrently herewith (the “Disclosure Schedules”), which Disclosure Schedules shall
be deemed a part hereof, each Debtor represents and warrants to, and covenants and agrees with, the Secured Party as follows:

 

(a)       Each
Debtor has the requisite corporate, partnership, limited liability company or other power and authority to enter into this Agreement and
otherwise to carry out its obligations hereunder. The execution, delivery and performance by each Debtor of this Agreement and the filings
contemplated therein have been duly authorized by all necessary action on the part of such Debtor and no further action is required by
such Debtor. This Agreement has been duly executed by each Debtor. This Agreement constitutes the legal, valid and binding obligation
of each Debtor, enforceable against each Debtor in accordance with its terms except as such enforceability may be limited by applicable
bankruptcy, insolvency, reorganization and similar laws of general application relating to or affecting the rights and remedies of creditors
and by general principles of equity.

 

(b)       The
Debtors have no place of business or offices where their respective books of account and records are kept (other than temporarily at the
offices of its attorneys or accountants) or places where Collateral is stored or located, except as set forth on Schedule A attached
hereto. Except as specifically set forth on Schedule A, each Debtor is the record owner of the real property or valid lessee where
such Collateral is located, and there exist no mortgages or other liens on any such real property except for Permitted Liens as set forth
on Schedule B. Except as disclosed on Schedule A, none of such Collateral is in the possession of any consignee, bailee,
warehouseman, agent or processor.

 

(c)       Except
for Permitted Liens and as set forth on Schedule B attached hereto, the Debtors are the sole owners of the Collateral (except for
non-exclusive licenses granted by any Debtor in the ordinary course of business), free and clear of any liens, security interests, encumbrances,
rights or claims, and are fully authorized to grant the Security Interests. Except as set forth on Schedule C attached hereto,
there is not on file in any governmental or regulatory authority, agency or recording office an effective financing statement, security
agreement, license or transfer or any notice of any of the foregoing (other than those that will be filed in favor of the Secured Party
pursuant to this Agreement) covering or affecting any of the Collateral. Except as set forth on Schedule C attached hereto and
except pursuant to this Agreement, as long as this Agreement shall be in effect, the Debtors shall not execute and shall not knowingly
permit to be on file in any such office or agency any other financing statement or other document or instrument (except to the extent
filed or recorded in favor of the Secured Party pursuant to the terms of this Agreement).

 

(d)       No
written claim has been received that any Collateral or any Debtor’s use of any Collateral violates the rights of any third party.
There has been no adverse decision to any Debtor’s claim of ownership rights in or exclusive rights to use the Collateral in any
jurisdiction or to any Debtor’s right to keep and maintain such Collateral in full force and effect, and there is no proceeding
involving said rights pending or, to the best knowledge of any Debtor, threatened before any court, judicial body, administrative or regulatory
agency, arbitrator or other governmental authority.

 

(e)       Each
Debtor shall at all times maintain its books of account and records relating to the Collateral at its principal place of business and
its Collateral at the locations set forth on Schedule A attached hereto and may not relocate such books of account and records
or tangible Collateral unless it delivers to the Secured Party at least thirty (30) days prior to such relocation (i) written notice of
such relocation and the new location thereof (which must be within the United States) and (ii) evidence that appropriate financing statements
under the UCC and other necessary documents have been filed and recorded and other steps have been taken to perfect the Security Interests
to create in favor of the Secured Party a valid, perfected and continuing perfected first priority lien in the Collateral.

 

 

 

 

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(f)       This
Agreement creates in favor of the Secured Party a valid first priority security interest in the Collateral, subject only to Permitted
Liens, securing the payment and performance of the Obligations. Upon making the filings described in the immediately following paragraph,
all security interests created hereunder in any Collateral which may be perfected by filing Uniform Commercial Code financing statements
shall have been duly perfected. Except for (i) the filing of the Uniform Commercial Code financing statements referred to in the immediately
following paragraph, (ii) the recordation of the Intellectual Property Security Agreement (as defined in Section 4(p) hereof) with respect
to copyrights and copyright applications in the United States Copyright Office referred to in paragraph (mm), (iii) the recordation of
the Intellectual Property Security Agreement (as defined in Section 4(p) hereof) with respect to patents and trademarks of the Debtors
in the United States Patent and Trademark Office referred to in paragraph (oo), (iv) the execution and delivery of deposit account control
agreements satisfying the requirements of Section 9-104(a)(2) of the UCC with respect to each deposit account of the Debtors, (v) if there
is any investment property or deposit account included as Collateral that can be perfected by “control” through an account
control agreement, the execution and delivery of securities account control agreements satisfying the requirements of 9-106 of the UCC
with respect to each such investment property of the Debtors, and (vi) the delivery of the certificates and other instruments provided
in Section 3, Section 4(aa) and Section 4(cc), no action is necessary to create, perfect or protect the security interests created hereunder.
Without limiting the generality of the foregoing, except for the foregoing, no consent of any third parties and no authorization, approval
or other action by, and no notice to or filing with, any governmental authority or regulatory body is required for (x) the execution,
delivery and performance of this Agreement, (y) the creation or perfection of the Security Interests created hereunder in the Collateral
or (z) the enforcement of the rights of the Secured Party hereunder.

 

(g)       Each
Debtor hereby authorizes the Secured Party to file one or more financing statements under the UCC, with respect to the Security Interests,
with the proper filing and recording agencies in any jurisdiction deemed proper by it.

 

(h)       The
execution, delivery and performance of this Agreement by the Debtors does not (i) violate any of the provisions of any Organizational
Documents of any Debtor or any judgment, decree, order or award of any court, governmental body or arbitrator or any applicable law, rule
or regulation applicable to any Debtor 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, 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 any Debtor’s debt or otherwise)
or other understanding to which any Debtor is a party or by which any property or asset of any Debtor is bound or affected. If any, all
required consents (including, without limitation, from stockholders or creditors of any Debtor) necessary for any Debtor to enter into
and perform its obligations hereunder have been obtained.

 

(i)        The
capital stock and other equity interests listed on Schedule H hereto (the “Pledged Securities”) represent all
capital stock and other equity interests of the Guarantors and represent all capital stock and other equity interests owned, directly
or indirectly, by the Company. All of the Pledged Securities are validly issued, fully paid and nonassessable, and the Company is the
legal and beneficial owner of the Pledged Securities, free and clear of any lien, security interest or other encumbrance except for the
security interests created by this Agreement and other Permitted Liens.

 

(j)        The
ownership and other equity interests in partnerships and limited liability companies (if any) included in the Collateral (the “Pledged
Interests”) by their express terms do not provide that they are securities governed by Article 8 of the UCC and are not held
in a securities account or by any financial intermediary.

 

(k)       Except
for Permitted Liens, each Debtor shall at all times maintain the liens and Security Interests provided for hereunder as valid and perfected,
first priority liens and security interests in the Collateral in favor of the Secured Party until this Agreement and the Security Interest
hereunder shall be terminated pursuant to Section 14 hereof. Each Debtor hereby agrees to defend the same against the claims of any and
all persons and entities. Each Debtor shall safeguard and protect all Collateral for the account of the Secured Party. At the request
of the Secured Party, each Debtor will sign and deliver to the Secured Party on behalf of the Secured Party at any time or from time to
time one or more financing statements pursuant to the UCC in form reasonably satisfactory to the Secured Party and will pay the cost of
filing the same in all public offices wherever filing is, or is deemed by the Secured Party to be, necessary or desirable to effect the
rights and obligations provided for herein. Without limiting the generality of the foregoing, each Debtor shall pay all fees, taxes and
other amounts necessary to maintain the Collateral and the Security Interests hereunder, and each Debtor shall obtain and furnish to the
Secured Party from time to time, upon demand, such releases and/or subordinations of claims and liens which may be required to maintain
the priority of the Security Interests hereunder.

 

 

 

 

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(l)       No
Debtor will transfer, pledge, hypothecate, encumber, license, sell or otherwise dispose of any of the Collateral (except for non-exclusive
licenses granted by a Debtor in its ordinary course of business, sales of inventory by a Debtor in its ordinary course of business and
the replacement of worn-out or obsolete equipment by a Debtor in its ordinary course of business) without the prior written consent of
the Secured Party.

 

(m)       Each
Debtor shall keep and preserve its equipment, inventory and other tangible Collateral in good condition, repair and order and shall not
operate or locate any such Collateral (or cause to be operated or located) in any area excluded from insurance coverage.

 

(n)       Each
Debtor shall maintain with financially sound and reputable insurers, insurance with respect to the Collateral, including Collateral hereafter
acquired, against loss or damage of the kinds and in the amounts customarily insured against by entities of established reputation having
similar properties similarly situated and in such amounts as are customarily carried under similar circumstances by other such entities
and otherwise as is prudent for entities engaged in similar businesses but in any event sufficient to cover the full replacement cost
thereof. Each Debtor shall cause each insurance policy issued in connection herewith to provide, and the insurer issuing such policy to
certify to the Secured Party, that (a) the Secured Party will be named as lender-loss-payee and additional insured under each such insurance
policy; (b) if such insurance be proposed to be cancelled or materially changed for any reason whatsoever, such insurer will promptly
notify the Secured Party and such cancellation or change shall not be effective as to the Secured Party for at least thirty (30) days
after receipt by the Secured Party of such notice, unless the effect of such change is to extend or increase coverage under the policy;
and (c) the Secured Party will have the right (but no obligation) at its election to remedy any default in the payment of premiums within
thirty (30) days of notice from the insurer of such default. If no Event of Default (as defined in the Secured Notes) exists and if the
proceeds arising out of any claim or series of related claims do not exceed $100,000, loss payments in each instance will be applied by
the applicable Debtor to the repair and/or replacement of property with respect to which the loss was incurred to the extent reasonably
feasible, and any loss payments or the balance thereof remaining, to the extent not so applied, shall be payable to the applicable Debtor;
provided, however, that payments received by any Debtor after an Event of Default (as defined in the Secured Notes) or an
Event of Default occurs and is continuing or in excess of $100,000 for any occurrence or series of related occurrences, upon approval
by Secured Party, which approval shall not be unreasonably withheld, delayed, denied or conditioned, loss payments in each instance will
be applied by the applicable Debtor to the repair and/or replacement of property with respect to which the loss was incurred to the extent
reasonably feasible, and any loss payments or the balance thereof remaining, to the extent not so applied, shall be paid to the Secured
Party and, if received by such Debtor, shall be held in trust for the Secured Party and immediately paid over to the Secured Party unless
otherwise directed in writing by the Secured Party. Copies of such policies or the related certificates, in each case, naming the Secured
Party as lender-loss-payee and additional insured shall be delivered to the Secured Party at least annually and at the time any new policy
of insurance is issued.

 

(o)       Each
Debtor shall, within ten (10) days of obtaining knowledge thereof, advise the Secured Party, in sufficient detail, of any material adverse
change in the Collateral, and of the occurrence of any event that would have a material adverse effect on the value of the Collateral
or on the Secured Party’s security interest, through the Secured Party, therein.

 

(p)       Each
Debtor shall promptly execute and deliver to the Secured Party such further deeds, mortgages, assignments, security agreements, financing
statements or other instruments, documents, certificates and assurances and take such further action as the Secured Party may from time
to time request and may in its sole discretion deem necessary to perfect, protect or enforce the Secured Party’s security interest
in the Collateral, including, without limitation, if applicable, the execution and delivery of a separate security agreement with respect
to each Debtor’s Intellectual Property (“Intellectual Property Security Agreement”) in which the Secured Party
has been granted a security interest hereunder, substantially in a form reasonably acceptable to the Secured Party, which Intellectual
Property Security Agreement, other than as stated therein, shall be subject to all of the terms and conditions hereof.

 

(q)       Upon
reasonable prior notice (so long as no Event of Default (as defined in the Secured Notes) has occurred or continuing, which in either
such event, no prior notice is required), each Debtor shall permit the Secured Party and its representatives and agents to inspect the
Collateral during normal business hours and to make copies of records pertaining to the Collateral as may be reasonably requested by the
Secured Party from time to time.

 

(r)       Each
Debtor shall take all steps reasonably necessary to diligently pursue and seek to preserve, enforce and collect any rights, claims, causes
of action and accounts receivable in respect of the Collateral.

 

 

 

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(s)       Each
Debtor shall promptly notify the Secured Party in sufficient detail upon becoming aware of any attachment, garnishment, execution or other
legal process levied against any Collateral and of any other information received by such Debtor that may materially affect the value
of the Collateral, the Security Interest or the rights and remedies of the Secured Party hereunder.

 

(t)       All
information heretofore, herein or hereafter supplied to the Secured Party by or on behalf of any Debtor with respect to the Collateral
is accurate and complete in all material respects as of the date furnished.

 

(u)       The
Debtors shall at all times preserve and keep in full force and effect their respective valid existence and good standing and any rights
and franchises material to its business.

 

(v)       No
Debtor will change its name, type of organization, jurisdiction of organization, organizational identification number (if it has one),
legal or corporate structure, or identity, or add any new fictitious name unless it provides at least ten (10) days’ prior written
notice to the Secured Party of such change and, at the time of such written notification, such Debtor provides any financing statements
or fixture filings necessary to perfect and continue the perfection of the Security Interests granted and evidenced by this Agreement.

 

(w)      Except
in the ordinary course of business, no Debtor may consign any of its inventory or sell any of its inventory on bill-and-hold, sale-or-return,
sale-on-approval, or other conditional terms of sale without the consent of the Secured Party, which shall not be unreasonably withheld,
delayed, denied, or conditioned.

 

(x)       No
Debtor may relocate its chief executive office to a new location without providing ten (10) days’ prior written notification thereof
to the Secured Party and so long as, at the time of such written notification, such Debtor provides any financing statements or fixture
filings necessary to perfect and continue the perfection of the Security Interests granted and evidenced by this Agreement.

 

(y)       Each
Debtor was organized and remains organized solely under the laws of the state set forth next to such Debtor’s name in Schedule
D attached hereto, which Schedule D sets forth each Debtor’s organizational identification number or, if any Debtor does
not have one, states that one does not exist.

 

(z)        (i)
The actual name of each Debtor is the name set forth in Schedule D attached hereto; (ii) no Debtor has any trade names except as
set forth on Schedule E attached hereto; (iii) no Debtor has used any name other than that stated in the preamble hereto or as
set forth on Schedule E for the preceding five (5) years; and (iv) no entity has merged into any Debtor or been acquired by any
Debtor within the past five years except as set forth on Schedule E.

 

(aa)      At any time and from
time to time that any Collateral consists of instruments, certificated securities or other items that require or permit possession by
the secured party to perfect the security interest created hereby, the applicable Debtor shall deliver such Collateral to the Secured
Party.

 

(bb)     Each Debtor, in its
capacity as issuer, hereby agrees to comply with any and all orders and instructions of Secured Party regarding the Pledged Interests
consistent with the terms of this Agreement without the further consent of any Debtor as contemplated by Section 8-106 (or any successor
section) of the UCC. Further, each Debtor agrees that it shall not enter into a similar agreement (or one that would confer “control”
within the meaning of Article 8 of the UCC) with any other person or entity.

 

(cc)      Each Debtor shall
cause all tangible chattel paper constituting Collateral to be delivered to the Secured Party, or, if such delivery is not possible, then
to cause such tangible chattel paper to contain a legend noting that it is subject to the security interest created by this Agreement.
To the extent that any Collateral consists of electronic chattel paper, the applicable Debtor shall cause the underlying chattel paper
to be “marked” within the meaning of Section 9-105 of the UCC (or successor Section thereto).

 

(dd)     If there is any investment
property or deposit account included as Collateral that can be perfected by “control” through an account control agreement,
the applicable Debtor shall cause such an account control agreement, in form and substance in each case satisfactory to the Secured Party.

 

 

 

 

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(ee)     To the extent that
any Collateral consists of letter-of-credit rights, the applicable Debtor shall cause the issuer of each underlying letter of credit to
consent to an assignment of the proceeds thereof to the Secured Party.

 

(ff)       To the extent that
any Collateral is in the possession of any third party, the applicable Debtor shall join with the Secured Party in notifying such third
party of the Secured Party’s security interest in such Collateral and shall use its best efforts to obtain an acknowledgement and
agreement from such third party with respect to the Collateral, in form and substance reasonably satisfactory to the Secured Party.

 

(gg)     If any Debtor shall
at any time hold or acquire a commercial tort claim, such Debtor shall promptly notify the Secured Party in a writing signed by such Debtor
of the particulars thereof and grant to the Secured Party in such writing a security interest therein and in the proceeds thereof, all
upon the terms of this Agreement, with such writing to be in form and substance satisfactory to the Secured Party.

 

(hh)     Each Debtor shall
immediately provide written notice to the Secured Party of any and all accounts that are equal to or in excess of $10,000 and which arise
out of contracts with any governmental authority and, to the extent necessary to perfect or continue the perfected status of the Security
Interests in such accounts and proceeds thereof, shall execute and deliver to the Secured Party an assignment of claims for such accounts
and cooperate with the Secured Party in taking any other steps required, in its judgment, under the Federal Assignment of Claims Act or
any similar federal, state or local statute or rule to perfect or continue the perfected status of the Security Interests in such accounts
and proceeds thereof.

 

(ii)       Each
Debtor shall cause each majority owned subsidiary of such Debtor to immediately become a party hereto (an “Additional Debtor”),
by executing and delivering an Additional Debtor Joinder in substantially the form of Annex A attached hereto and comply with the
provisions hereof applicable to the Debtors. Concurrently therewith, the Additional Debtor shall deliver replacement schedules for, or
supplements to all other Schedules to (or referred to in) this Agreement, as applicable, which replacement schedules shall supersede,
or supplements shall modify, the Schedules then in effect. The Additional Debtor shall also deliver such opinions of counsel, authorizing
resolutions, good standing certificates, incumbency certificates, organizational documents, financing statements and other information
and documentation as the Secured Party may reasonably request. Upon delivery of the foregoing to the Secured Party, the Additional Debtor
shall be and become a party to this Agreement with the same rights and obligations as the Debtors, for all purposes hereof as fully and
to the same extent as if it were an original signatory hereto and shall be deemed to have made the representations, warranties and covenants
set forth herein as of the date of execution and delivery of such Additional Debtor Joinder, and all references herein to the “Debtors”
shall be deemed to include each Additional Debtor.

 

(jj)       Each Debtor shall
vote the Pledged Securities to comply with the covenants and agreements set forth herein.

 

(kk)     Each Debtor shall
register the pledge of the applicable Pledged Securities on the books of such Debtor. Each Debtor shall notify each issuer of Pledged
Securities to register the pledge of the applicable Pledged Securities in the name of the Secured Party on the books of such issuer. Further,
except with respect to certificated securities delivered to the Secured Party, the applicable Debtor shall deliver to Secured Party an
acknowledgement of pledge (which, where appropriate, shall comply with the requirements of the relevant UCC with respect to perfection
by registration) signed by the issuer of the applicable Pledged Securities, which acknowledgement shall confirm that: (a) it has registered
the pledge on its books and records; and (b) at any time directed by Secured Party during the continuation of an Event of Default, such
issuer will transfer the record ownership of such Pledged Securities into the name of any designee of Secured Party, will take such steps
as may be necessary to effect the transfer, and will comply with all other instructions of Secured Party regarding such Pledged Securities
without the further consent of the applicable Debtor.

 

(ll)        In the event that,
upon an occurrence of an Event of Default, Secured Party shall sell all or any of the Pledged Securities to another party or parties (herein
called the “Transferee”) or shall purchase or retain all or any of the Pledged Securities, each Debtor shall, to the
extent applicable: (i) deliver to Secured Party or the Transferee, as the case may be, the articles of incorporation, bylaws, minute books,
stock certificate books, corporate seals, deeds, leases, indentures, agreements, evidences of indebtedness, books of account, financial
records and all other Organizational Documents and records of the Debtors and their direct and indirect subsidiaries (but not including
any items subject to the attorney-client privilege related to this Agreement or any of the transactions hereunder); (ii) use its best
efforts to obtain resignations of the persons then serving as officers and directors of the Debtors and their direct and indirect subsidiaries,
if so requested; and (iii) use its best efforts to obtain any approvals that are required by any governmental or regulatory body in order
to permit the sale of the Pledged Securities to the Transferee or the purchase or retention of the Pledged Securities by Secured Party
and allow the Transferee or Secured Party to continue the business of the Debtors and their direct and indirect subsidiaries.

 

 

 

 

    	 	8	 

     

    

 

 

(mm)    Without limiting
the generality of the other obligations of the Debtors hereunder, each Debtor shall promptly (i) cause to be registered at the United
States Copyright Office all of its material copyrights, (ii) cause the security interest contemplated hereby with respect to all Intellectual
Property registered at the United States Copyright Office or United States Patent and Trademark Office to be duly recorded at the applicable
office, and (iii) give the Secured Party notice whenever it acquires (whether absolutely or by license) or creates any additional material
Intellectual Property.

 

(nn)     Each Debtor will
from time to time, at the joint and several expense of the Debtors, promptly execute and deliver all such further instruments and documents,
and take all such further action as may be necessary or desirable, or as the Secured Party may reasonably request, in order to perfect
and protect any security interest granted or purported to be granted hereby or to enable the Secured Party to exercise and enforce their
rights and remedies hereunder and with respect to any Collateral or to otherwise carry out the purposes of this Agreement.

 

(oo)     Schedule
F attached hereto lists all of the patents, patent applications, trademarks, trademark applications, registered copyrights, and domain
names owned by any of the Debtors as of the date hereof. Schedule F lists all material licenses in favor of any Debtor for the
use of any patents, trademarks, copyrights and domain names as of the date hereof. All material patents and trademarks of the Debtors
have been duly recorded at the United States Patent and Trademark Office and all material copyrights of the Debtors have been duly recorded
at the United States Copyright Office.

 

(pp)     Except as set forth
on Schedule G attached hereto, none of the account debtors or other persons or entities obligated on any of the Collateral is a
governmental authority covered by the Federal Assignment of Claims Act or any similar federal, state or local statute or rule in respect
of such Collateral.

 

(qq)     Until the Obligations
shall have been paid and performed in full, the Company covenants that it shall promptly direct any direct or indirect majority owned
subsidiary of the Company formed or acquired after the date hereof to enter into a guarantee in favor of the Secured Party, in such form
as may be agreed to by the parties.

 

5.       Effect
of Pledge on Certain Rights. If any of the Collateral subject to this Agreement consists of nonvoting equity or ownership interests
(regardless of class, designation, preference or rights) that may be converted into voting equity or ownership interests upon the occurrence
of certain events (including, without limitation, upon the transfer of all or any of the other stock or assets of the issuer), it is agreed
by Debtors that the pledge of such equity or ownership interests pursuant to this Agreement or the enforcement of any of Secured Party’s
rights hereunder shall not be deemed to be the type of event which would trigger such conversion rights notwithstanding any provisions
in the Organizational Documents or agreements to which any Debtor is subject or to which any Debtor is party.

 

6.       Defaults.
The following events shall be “Events of Default”:

 

(a)       The
occurrence of an Event of Default (as defined in the Secured Notes);

 

(b)       Any
representation or warranty of any Debtor in this Agreement shall prove to have been incorrect in any material respect when made;

 

(c)       The
failure by any Debtor to observe or perform any of its material obligations hereunder for five (5) days after delivery to such Debtor
of notice of such failure by or on behalf of a Secured Party unless such default is capable of cure but cannot be cured within such time
frame and such Debtor is using best efforts to cure same in a timely fashion; or

 

(d)       If
any provision of this Agreement shall at any time for any reason be declared to be null and void, or the validity or enforceability thereof
shall be contested by any Debtor, or a proceeding shall be commenced by any Debtor, or by any governmental authority having jurisdiction
over any Debtor, seeking to establish the invalidity or unenforceability thereof, or any Debtor shall deny that any Debtor has any liability
or obligation purported to be created under this Agreement.

 

7.       Duty
to Hold in Trust.

 

(a)       Upon
the occurrence of any Event of Default and at any time thereafter, each Debtor shall, upon receipt of any revenue, income, dividend, interest
or other sums subject to the Security Interests or of any check, draft, note, trade acceptance or other instrument evidencing an obligation
to pay any such sum, hold the same in trust for the Secured Party and shall forthwith endorse and transfer any such sums or instruments,
or both, to the Secured Party, pro-rata in proportion to their respective then-currently issued and outstanding Principal Amount for application
to the satisfaction of the Obligations.

 

 

 

 

    	 	9	 

     

    

 

(b)       If
any Debtor shall become entitled to receive or shall receive any securities or other property (including, without limitation, shares of
Pledged Securities or instruments representing Pledged Securities acquired after the date hereof, or any options, warrants, rights or
other similar property or certificates representing a dividend, or any distribution in connection with any recapitalization, reclassification
or increase or reduction of capital, or issued in connection with any reorganization of such Debtor or any of its direct or indirect subsidiaries)
in respect of the Pledged Securities (whether as an addition to, in substitution of, or in exchange for, such Pledged Securities or otherwise),
such Debtor agrees to (i) accept the same as the agent of the Secured Party; (ii) hold the same in trust on behalf of and for the benefit
of the Secured Party; and (iii) to deliver any and all certificates or instruments evidencing the same to Secured Party on or before the
close of business on the fifth (5th) business day following the receipt thereof by such Debtor, in the exact form received
together with the Necessary Endorsements, to be held by Secured Party subject to the terms of this Agreement as Collateral.

 

8.       Rights
and Remedies Upon Default.

 

(a)       Upon
the occurrence of any Event of Default and at any time thereafter, the Secured Party shall have the right to exercise all of the remedies
conferred hereunder and under the Secured Notes), and the Secured Party shall have all the rights and remedies of a secured party under
the UCC. Without limitation, the Secured Party shall have the following rights and powers:

 

(i)         The
Secured Party shall have the right to take possession of the Collateral and, for that purpose, enter, with the aid and assistance of any
person, any premises where the Collateral, or any part thereof, is or may be placed and remove the same, and each Debtor shall assemble
the Collateral and make it available to the Secured Party at places which the Secured Party shall reasonably select, whether at such Debtor’s
premises or elsewhere, and make available to the Secured Party, without rent, all of such Debtor’s respective premises and facilities
for the purpose of the Secured Party taking possession of, removing or putting the Collateral in saleable or disposable form.

 

(ii)        Upon
notice to the Debtors by Secured Party, all rights of each Debtor to exercise the voting and other consensual rights which it would otherwise
be entitled to exercise and all rights of each Debtor to receive the dividends and interest which it would otherwise be authorized to
receive and retain, shall cease. Upon such notice, Secured Party shall have the right to receive, for the benefit of the Secured Party,
any interest, cash dividends or other payments on the Collateral and, at the option of Secured Party, to exercise in such Secured Party’s
discretion all voting rights pertaining thereto. Without limiting the generality of the foregoing, Secured Party shall have the right
(but not the obligation) to exercise all rights with respect to the Collateral as it were the sole and absolute owner thereof, including,
without limitation, to vote and/or to exchange, at its sole discretion, any or all of the Collateral in connection with a merger, reorganization,
consolidation, recapitalization or other readjustment concerning or involving the Collateral or any Debtor or any of its direct or indirect
subsidiaries.

 

(iii)       The
Secured Party shall have the right to operate the business of each Debtor using the Collateral and shall have the right to assign, sell,
lease or otherwise dispose of and deliver all or any part of the Collateral, at public or private sale or otherwise, either with or without
special conditions or stipulations, for cash or on credit or for future delivery, in such parcel or parcels and at such time or times
and at such place or places, and upon such terms and conditions as the Secured Party may deem commercially reasonable, all without (except
as shall be required by applicable statute and cannot be waived) advertisement or demand upon or notice to any Debtor or right of redemption
of a Debtor, which are hereby expressly waived. Upon each such sale, lease, assignment or other transfer of Collateral, the Secured Party
may, unless prohibited by applicable law which cannot be waived, purchase all or any part of the Collateral being sold, free from and
discharged of all trusts, claims, right of redemption and equities of any Debtor, which are hereby waived and released.

 

(iv)       The
Secured Party shall have the right (but not the obligation) to notify any account debtors and any obligors under instruments or accounts
to make payments directly to the Secured Party, and to enforce the Debtors’ rights against such account debtors and obligors.

 

(v)       The
Secured Party may (but is not obligated to) direct any financial intermediary or any other person or entity holding any investment property
to transfer the same to the Secured Party, or its designee.

 

(vi)       The
Secured Party may (but is not obligated to) transfer any or all Intellectual Property registered in the name of any Debtor at the United
States Patent and Trademark Office and/or Copyright Office into the name of the Secured Party or any designee or any purchaser of any
Collateral.

 

(b)       The
Secured Party shall comply with any applicable law in connection with a disposition of Collateral and such compliance will not be considered
adversely to affect the commercial reasonableness of any sale of the Collateral. The Secured Party may sell the Collateral without giving
any warranties and may specifically disclaim such warranties. If the Secured Party sells any of the Collateral on credit, the Debtors
will only be credited with payments actually made by the purchaser. In addition, each Debtor waives (except as shall be required by applicable
statute and cannot be waived) any and all rights that it may have to a judicial hearing in advance of the enforcement of any of the Secured
Party’s rights and remedies hereunder, including, without limitation, its right following an Event of Default to take immediate
possession of the Collateral and to exercise its rights and remedies with respect thereto.

 

 

 

 

    	 	10	 

     

    

 

(c)       For
the purpose of enabling the Secured Party to further exercise rights and remedies under this Section 8 or elsewhere provided by agreement
or applicable law, each Debtor hereby grants to the Secured Party an irrevocable, nonexclusive license (exercisable without payment of
royalty or other compensation to such Debtor) to use, license or sublicense following an Event of Default, any Intellectual Property now
owned or hereafter acquired by such Debtor, and wherever the same may be located, and including in such license access to all media in
which any of the licensed items may be recorded or stored and to all computer software and programs used for the compilation or printout
thereof.

 

9.       Applications
of Proceeds. The proceeds of any such sale, lease or other disposition of the Collateral hereunder or from payments made on account
of any insurance policy insuring any portion of the Collateral shall be applied first, to the expenses of retaking, holding, storing,
processing and preparing for sale, selling, and the like (including, without limitation, any taxes, fees and other costs incurred in connection
therewith) of the Collateral, to the reasonable attorneys’ fees and expenses incurred by the Secured Party in enforcing the Secured
Party’s rights hereunder and in connection with collecting, storing and disposing of the Collateral, and then to satisfaction of
the Obligations pro rata among the Secured Party (based on then issued and outstanding Securities at the time of any such determination),
and to the payment of any other amounts required by applicable law, after which the Secured Party shall pay to the applicable Debtor any
surplus proceeds. If, upon the sale, license or other disposition of the Collateral, the proceeds thereof are insufficient to pay all
amounts to which the Secured Party is legally entitled, the Debtors will be liable for the deficiency, together with interest thereon,
at the rate of 33% per annum or the lesser amount permitted by applicable law (the “Default Rate”), and the reasonable
fees of any attorneys employed by the Secured Party to collect such deficiency. To the extent permitted by applicable law, each Debtor
waives all claims, damages and demands against the Secured Party arising out of the repossession, removal, retention or sale of the Collateral,
unless due solely to the gross negligence or willful misconduct of the Secured Party as determined by a final judgment (not subject to
further appeal) of a court of competent jurisdiction.

 

10.     Securities
Law Provision. Each Debtor recognizes that Secured Party may be limited in its ability to effect a sale to the public of all or part
of the Pledged Securities by reason of certain prohibitions in the Securities Act of 1933, as amended, or other federal or state securities
laws (collectively, the “Securities Laws”), and may be compelled to resort to one or more sales to a restricted group
of purchasers who may be required to agree to acquire the Pledged Securities for their own account, for investment and not with a view
to the distribution or resale thereof. Each Debtor agrees that sales so made may be at prices and on terms less favorable than if the
Pledged Securities were sold to the public, and that Secured Party has no obligation to delay the sale of any Pledged Securities for the
period of time necessary to register the Pledged Securities for sale to the public under the Securities Laws. Each Debtor shall cooperate
with Secured Party in its attempt to satisfy any requirements under the Securities Laws (including, without limitation, registration thereunder
if requested by Secured Party) applicable to the sale of the Pledged Securities by Secured Party.

 

11.     Costs
and Expenses. Each Debtor agrees to pay all reasonable out-of-pocket fees, costs and expenses incurred in connection with any filing
required hereunder, including without limitation, any financing statements pursuant to the UCC, continuation statements, partial releases
and/or termination statements related thereto, or any expenses of any searches reasonably required by the Secured Party. The Debtors shall
also pay all other claims and charges which in the reasonable opinion of the Secured Party are reasonably likely to prejudice, imperil
or otherwise affect the Collateral or the Security Interests therein. The Debtors will also, upon demand, pay to the Secured Party the
amount of any and all reasonable expenses, including the reasonable fees and expenses of its counsel and of any experts and agents, which
the Secured Party may incur in connection with the creation, perfection, protection, satisfaction, foreclosure, collection or enforcement
of the Security Interest and the preparation, administration, continuance, amendment or enforcement of this Agreement and pay to the Secured
Party the amount of any and all reasonable expenses, including the reasonable fees and expenses of its counsel and of any experts and
agents, which the Secured Party may incur in connection with (i) the enforcement of this Agreement, (ii) the custody or preservation of,
or the sale of, collection from, or other realization upon, any of the Collateral, or (iii) the exercise or enforcement of any of the
rights of the Secured Party under the Secured Notes. Until so paid, any fees payable hereunder shall be added to the amounts owed under
the Secured Notes and shall bear interest at the Default Rate.

 

12.     Responsibility
for Collateral. The Debtors assume all liabilities and responsibility in connection with all Collateral, and the Obligations shall
in no way be affected or diminished by reason of the loss, destruction, damage or theft of any of the Collateral or its unavailability
for any reason. Without limiting the generality of the foregoing and except as required by applicable law, (a) the Secured Party (i) has
no duty (either before or after an Event of Default) to collect any amounts in respect of the Collateral or to preserve any rights relating
to the Collateral, and (ii) has no obligation to clean-up or otherwise prepare the Collateral for sale, and (b) each Debtor shall remain
obligated and liable under each contract or agreement included in the Collateral to be observed or performed by such Debtor thereunder.
The Secured Party shall have no obligation or liability under any such contract or agreement by reason of or arising out of this Agreement
or the receipt by the Secured Party of any payment relating to any of the Collateral, nor shall the Secured Party be obligated in any
manner to perform any of the obligations of any Debtor under or pursuant to any such contract or agreement, to make inquiry as to the
nature or sufficiency of any payment received by the Secured Party in respect of the Collateral or as to the sufficiency of any performance
by any party under any such contract or agreement, to present or file any claim, to take any action to enforce any performance or to collect
the payment of any amounts which may have been assigned to or to which the Secured Party may be entitled at any time or times.

 

 

 

    	 	11	 

     

    

 

 

13.     Security
Interests Absolute. All rights of the Secured Party and all obligations of each Debtor hereunder, shall be absolute and unconditional,
irrespective of: (a) any lack of validity or enforceability of this Agreement, the Secured Notes, or any agreement entered into in connection
with the foregoing, or any portion hereof or thereof, against any other Debtor or Guarantor; (b) any change in the time, manner or place
of payment or performance of, or in any other term of, all or any of the Obligations, or any other amendment or waiver of or any consent
to any departure from the Secured Notes or any other agreement entered into in connection with the foregoing; (c) any exchange, release
or nonperfection of any of the Collateral, or any release or amendment or waiver of or consent to departure from any other collateral
for, or any guarantee, or any other security, for all or any of the Obligations; (d) any action by the Secured Party to obtain, adjust,
settle and cancel in its sole discretion any insurance claims or matters made or arising in connection with the Collateral; or (e) any
other circumstance which might otherwise constitute any legal or equitable defense available to a Debtor, or a discharge of all or any
part of the Security Interests granted hereby. Until the Obligations shall have been paid and performed in full, the rights of the Secured
Party shall continue even if the Obligations are barred for any reason, including, without limitation, the running of the statute of limitations.
Each Debtor expressly waives presentment, protest, notice of protest, demand, notice of nonpayment and demand for performance. In the
event that at any time any transfer of any Collateral or any payment received by the Secured Party hereunder shall be deemed by final
order of a court of competent jurisdiction to have been a voidable preference or fraudulent conveyance under the bankruptcy or insolvency
laws of the United States, or shall be deemed to be otherwise due to any party other than the Secured Party, then, in any such event,
each Debtor’s obligations hereunder shall survive cancellation of this Agreement, and shall not be discharged or satisfied by any
prior payment thereof and/or cancellation of this Agreement, but shall remain a valid and binding obligation enforceable in accordance
with the terms and provisions hereof. Each Debtor waives all right to require the Secured Party to proceed against any other person or
entity or to apply any Collateral which the Secured Party may hold at any time, or to marshal assets, or to pursue any other remedy. Each
Debtor waives any defense arising by reason of the application of the statute of limitations to any obligation secured hereby.

 

14.     Term
of Agreement. This Agreement shall terminate on the date on which all payments under the Secured Notes have been paid in full and
all other Obligations have been paid or discharged; provided, however, that all indemnities of the Debtors contained in
this Agreement shall survive and remain operative and in full force and effect regardless of the termination of this Agreement.

 

15.     Power
of Attorney; Further Assurances.

 

(a)       Each
Debtor authorizes the Secured Party, and does hereby make, constitute and appoint the Secured Party and its officers, agents, successors
or assigns with full power of substitution, as such Debtor’s true and lawful attorney-in-fact, with power, in the name of the Secured
Party or such Debtor, to, after the occurrence and during the continuance of an Event of Default, (i) endorse any note, checks, drafts,
money orders or other instruments of payment (including payments payable under or in respect of any policy of insurance) in respect of
the Collateral that may come into possession of the Secured Party; (ii) to sign and endorse any financing statement pursuant to the UCC
or any invoice, freight or express bill, bill of lading, storage or warehouse receipts, drafts against debtors, assignments, verifications
and notices in connection with accounts, and other documents relating to the Collateral; (iii) to pay or discharge taxes, liens, security
interests or other encumbrances at any time levied or placed on or threatened against the Collateral; (iv) to demand, collect, receipt
for, compromise, settle and sue for monies due in respect of the Collateral; (v) to transfer any Intellectual Property or provide licenses
respecting any Intellectual Property; and (vi) generally, at the option of the Secured Party, and at the expense of the Debtors, at any
time, or from time to time, to execute and deliver any and all documents and instruments and to do all acts and things which the Secured
Party deems necessary to protect, preserve and realize upon the Collateral and the Security Interests granted therein in order to effect
the intent of this Agreement all as fully and effectually as the Debtors might or could do; and each Debtor hereby ratifies all that said
attorney shall lawfully do or cause to be done by virtue hereof. This power of attorney is coupled with an interest and shall be irrevocable
for the term of this Agreement and thereafter as long as any of the Obligations shall be outstanding. The designation set forth herein
shall be deemed to amend and supersede any inconsistent provision in the Organizational Documents or other documents or agreements to
which any Debtor is subject or to which any Debtor is a party. Without limiting the generality of the foregoing, after the occurrence
and during the continuance of an Event of Default, each Secured Party is specifically authorized to execute and file any applications
for or instruments of transfer and assignment of any patents, trademarks, copyrights or other Intellectual Property with the United States
Patent and Trademark Office and the United States Copyright Office.

 

(b)       On
a continuing basis, each Debtor will make, execute, acknowledge, deliver, file and record, as the case may be, with the proper filing
and recording agencies in any jurisdiction, including, without limitation, the jurisdictions indicated on Schedule C attached hereto,
all such instruments, and take all such action as may reasonably be deemed necessary or advisable, or as reasonably requested by the Secured
Party, to perfect the Security Interests granted hereunder and otherwise to carry out the intent and purposes of this Agreement, or for
assuring and confirming to the Secured Party the grant or perfection of a perfected security interest in all the Collateral under the
UCC.

 

 

 

 

    	 	12	 

     

    

 

(c)       Each
Debtor hereby irrevocably appoints the Secured Party as such Debtor’s attorney-in-fact, with full authority in the place and instead
of such Debtor and in the name of such Debtor, from time to time in the Secured Party’s discretion, to take any action and to execute
any instrument which the Secured Party may deem necessary or advisable to accomplish the purposes of this Agreement, including the filing,
in its sole discretion, of one or more financing or continuation statements and amendments thereto, relative to any of the Collateral
without the signature of such Debtor where permitted by law, which financing statements may (but need not) describe the Collateral as
“all assets” or “all personal property” or words of like import, and ratifies all such actions taken by the Secured
Party. This power of attorney is coupled with an interest and shall be irrevocable for the term of this Agreement and thereafter as long
as any of the Obligations shall be outstanding.

 

16.     Notices.
All notices, requests, demands and other communications hereunder shall be subject to the notice provision of the Secured Notes.

 

17.     Other
Security. To the extent that the Obligations are now or hereafter secured by property other than the Collateral or by the guarantee,
endorsement or property of any other person, firm, corporation or other entity, then the Secured Party shall have the right, in its sole
discretion, to pursue, relinquish, subordinate, modify or take any other action with respect thereto, without in any way modifying or
affecting any of the Secured Party’s rights and remedies hereunder.

 

18.     Miscellaneous.

 

(a)       No
course of dealing between the Debtors and the Secured Party, nor any failure to exercise, nor any delay in exercising, on the part of
the Secured Party, any right, power or privilege hereunder or under the Secured Notes shall operate as a waiver thereof; nor shall any
single or partial exercise of any right, power or privilege hereunder or thereunder preclude any other or further exercise thereof or
the exercise of any other right, power or privilege.

 

(b)       All
of the rights and remedies of the Secured Party with respect to the Collateral, whether established hereby, the Secured Notes, or by any
other agreements, instruments or documents or by law shall be cumulative and may be exercised singly or concurrently.

 

(c)       This
Agreement, together with the exhibits and schedules hereto, contains the entire understanding of the parties with respect to the subject
matter hereof and supersede all prior agreements and understandings, oral or written, with respect to such matters, which the parties
acknowledge have been merged into this Agreement and the exhibits and schedules hereto. 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 Debtors and the Secured Party,
or, in the case of a waiver, by the party against whom enforcement of any such waived provision is sought.

 

(d)       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.

 

(e)       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.

 

(f)       This
Agreement shall be binding upon and inure to the benefit of the parties and their successors and permitted assigns. The Company and the
Guarantors may not assign this Agreement or any rights or obligations hereunder without the prior written consent of each Secured Party
(other than by merger).

 

(g)       Each
party shall take such further action and execute and deliver such further documents as may be necessary or appropriate in order to carry
out the provisions and purposes of this Agreement.

 

 

 

 

    	 	13	 

     

    

 

(h)       Except
to the extent mandatorily governed by the jurisdiction or situs where the Collateral is located, all questions concerning the construction,
validity, enforcement and interpretation of this Agreement shall be governed by and construed and enforced in accordance with the internal
laws of the State of Delaware, without regard to the principles of conflicts of law thereof. Except to the extent mandatorily governed
by the jurisdiction or situs where the Collateral is located, each Debtor agrees that all proceedings concerning the interpretations,
enforcement and defense of the transactions contemplated by this Agreement and the Secured Notes (whether brought against a party hereto
or its respective affiliates, directors, officers, shareholders, partners, members, employees or agents) shall be commenced exclusively
in the state and federal courts sitting in Boulder County or Denver County, Colorado. Except to the extent mandatorily governed by the
jurisdiction or situs where the Collateral is located, each Debtor hereby irrevocably submits to the exclusive jurisdiction of the state
and federal courts sitting in Boulder County or Denver County, Colorado for the adjudication of any dispute hereunder or in connection
herewith or with any transaction contemplated hereby or discussed herein, and hereby irrevocably waives, and agrees not to assert in any
proceeding, any claim that it is not personally subject to the jurisdiction of any such court, that such proceeding is improper. Each
party hereto hereby irrevocably waives, to the fullest extent permitted by applicable law, any and all right to trial by jury in any legal
proceeding arising out of or relating to this Agreement or the transactions contemplated hereby.

 

(i)        This
Agreement may be executed in any number of counterparts, each of which when so executed shall be deemed to be an original and, all of
which taken together shall constitute one and the same Agreement. In the event that any signature is delivered by facsimile transmission,
such signature shall create a valid binding obligation of the party executing (or on whose behalf such signature is executed) the same
with the same force and effect as if such facsimile signature were the original thereof.

 

(j)        All
Debtors shall jointly and severally be liable for the obligations of each Debtor to the Secured Party hereunder.

 

(k)       Each
Debtor shall indemnify, reimburse and hold harmless the Secured Party and its respective partners, members, shareholders, officers, directors,
employees and agents (and any other persons with other titles that have similar functions) (collectively, “Indemnitees”)
from and against any and all losses, claims, liabilities, damages, penalties, suits, costs and expenses, of any kind or nature, (including
fees relating to the cost of investigating and defending any of the foregoing) imposed on, incurred by or asserted against such Indemnitee
in any way related to or arising from or alleged to arise from this Agreement or the Collateral, except any such losses, claims, liabilities,
damages, penalties, suits, costs and expenses which result from the gross negligence or willful misconduct of the Indemnitee as determined
by a final, nonappealable decision of a court of competent jurisdiction. This indemnification provision is in addition to, and not in
limitation of, any other indemnification provision in the Secured Notes or any other agreement, instrument or other document executed
or delivered in connection herewith or therewith.

 

(l)       Nothing
in this Agreement shall be construed to subject the Secured Party to liability as a partner in any Debtor or any if its direct or indirect
subsidiaries that is a partnership or as a member in any Debtor or any of its direct or indirect subsidiaries that is a limited liability
company, nor shall the Secured Party be deemed to have assumed any obligations under any partnership agreement or limited liability company
agreement, as applicable, of any such Debtor or any of its direct or indirect subsidiaries or otherwise, unless and until the Secured
Party exercises its right to be substituted for such Debtor as a partner or member, as applicable, pursuant hereto.

 

(m)       To
the extent that the grant of the security interest in the Collateral and the enforcement of the terms hereof require the consent, approval
or action of any partner or member, as applicable, of any Debtor or any direct or indirect subsidiary of any Debtor or compliance with
any provisions of any of the Organizational Documents, the Debtors hereby represent that all such consents and approvals have been obtained.

 

 

[SIGNATURE PAGE OF DEBTORS FOLLOWS]

 

 

 

 

 

 

    	 	14	 

     

    

 

IN WITNESS WHEREOF, the parties
hereto have caused this Security Agreement to be duly executed on the day and year first above written.

 

 

AUDDIA
INC.

 

 

By: /s/ Michael Lawless                     

Name: Michael Lawless

Title: Chief Executive Officer

 

 

 

 

 

[SIGNATURE PAGE OF HOLDERS FOLLOWS]

 

 

 

 

 

 

 

 

 

 

 

    	 	15	 

     

    

[SIGNATURE PAGE OF HOLDERS TO SECURITY AGREEMENT]

 

 

SECURED PARTY

 

 

/s/ Richard M. Minicozzi                    

Richard M. Minicozzi

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

    	 	16	 

     

    

 

DISCLOSURE SCHEDULES

 

(Security Agreement)

 

 

[Omitted]

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

    	 	17	 

     

    

 

ANNEX A

to

SECURITY AGREEMENT

 

FORM OF ADDITIONAL DEBTOR JOINDER

 

Security Agreement dated as
of [_________], 20__, made by Auddia Inc. and its subsidiaries party thereto from time to time, as Debtors to and in favor of the Secured
Party identified therein (the “Security Agreement”).

 

Reference is made to the Security
Agreement as defined above; capitalized terms used herein and not otherwise defined herein shall have the meanings given to such terms
in, or by reference in, the Security Agreement.

 

The undersigned hereby agrees
that, upon delivery of this Additional Debtor Joinder to the Secured Party referred to above, the undersigned shall (a) be an Additional
Debtor under the Security Agreement, (b) have all the rights and obligations of the Debtors under the Security Agreement as fully and
to the same extent as if the undersigned was an original signatory thereto and (c) be deemed to have made the representations and warranties
set forth therein as of the date of execution and delivery of this Additional Debtor Joinder. WITHOUT LIMITING THE GENERALITY OF THE FOREGOING,
THE UNDERSIGNED SPECIFICALLY GRANTS TO THE SECURED PARTY A SECURITY INTEREST IN THE COLLATERAL AS MORE FULLY SET FORTH IN THE SECURITY
AGREEMENT AND ACKNOWLEDGES AND AGREES TO THE WAIVER OF JURY TRIAL PROVISIONS SET FORTH THEREIN.

 

Attached hereto are supplemental
and/or replacement Schedules to the Security Agreement, as applicable.

 

An executed copy of this Joinder
shall be delivered to the Secured Party, and the Secured Party may rely on the matters set forth herein on or after the date hereof. This
Joinder shall not be modified, amended or terminated without the prior written consent of the Secured Party.

 

IN WITNESS WHEREOF, the undersigned
has caused this Joinder to be executed in the name and on behalf of the undersigned.

 

 

	 	[Name of Additional Debtor]
	 	 
	 	By:
	 	Name:
	 	Title:
	 	 
	 	Address:

Dated:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

    	 	18Exhibit 10.4

 

COMMON STOCK PURCHASE AGREEMENT

 

This Common Stock Purchase
Agreement (this “Agreement”) is entered into effective as November 14, 2022 (the “Execution Date”),
by and between Auddia Inc., a Delaware corporation (the “Company”), and White Lion Capital LLC, a Nevada limited liability
company (the “Investor”).

 

WHEREAS, the parties
desire that, upon the terms and subject to the conditions contained herein, the Investor shall purchase, from time to time, as provided
herein, and the Company shall issue and sell up to Ten Million Dollars ($10,000,000) of the Company’s Common Stock (as defined below);

 

WHEREAS, such sales of Common Stock by the Company to the Investor will be made pursuant to a registration statement effective under
the Securities Act (as defined below); and

 

WHEREAS, in consideration
for the Investor’s execution and delivery of this Agreement, the Company shall issue to the Investor the Commitment Shares (as defined
below), pursuant to and in accordance with Section 6.4 herein;

 

NOW, THEREFORE, the
parties hereto agree as follows:

 

ARTICLE I

CERTAIN DEFINITIONS

 

Section 1.1. DEFINED TERMS.
As used in this Agreement, the following terms shall have the following meanings specified or indicated (such meanings to be equally applicable
to both the singular and plural forms of the terms defined):

 

“Agreement”
shall have the meaning specified in the preamble hereof.

 

“Average Daily Trading
Volume” shall mean the median daily trading volume of the Company’s Common Stock over the most recent five (5) Business
Days immediately preceding the date of delivery of a Purchase Notice (Exhibit A).

 

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

 

“Base Registration
Statement” shall have the meaning specified in Section 4.15.

 

“Beneficial Ownership
Limitation” shall have the meaning specified in Section 7.2(g).

 

“Business Day”
shall mean a day on which the Principal Market shall be open for business.

 

“Claim Notice”
shall have the meaning specified in Section 9.3(a).

 

“Clearing Costs”
shall mean $1,000 to cover the Investor’s broker and Transfer Agent costs with respect to each deposit of Common Stock.

 

“Closing”
shall mean the closing of a purchase and sale of shares of Common Stock pursuant to Section 2.1.

 

“Closing Date”
shall have the meaning specified in Section 2.2(b).

 

“Commitment Amount”
shall mean Ten Million Dollars ($10,000,000).

 

“Commitment Period”
shall mean the period commencing on the Execution Date and ending on the earlier of (i) the date on which the Investor shall have purchased
a number of Purchase Notice Shares pursuant to this Agreement equal to the Commitment Amount or (ii) December 31, 2023.

 

“Commitment Shares”
shall have the meaning set forth in Section 6.4.

 

“Common Stock”
shall mean the Company’s common stock, $0.001 par value per share, and any shares of any other class of common stock whether now
or hereafter authorized, having the right to participate in the distribution of dividends (as and when declared) and assets (upon liquidation
of the Company).

 

 

 

    	 	1	 

     

    

 

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

 

“Company”
shall have the meaning specified in the preamble to this Agreement.

 

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

 

“Current Report”
has the meaning set forth in Section 6.2.

 

“Damages”
shall mean any loss, claim, damage, liability, cost and expense (including, without limitation, reasonable attorneys’ fees and disbursements
and costs and expenses of expert witnesses and investigation).

 

“Designated Brokerage
Account” shall mean the brokerage account provided by the Investor for the delivery of the applicable Securities.

 

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

 

“Discount Percentage”
means ninety-seven percent (97%).

 

“Document Preparation
Fee” shall be $5,000 payable by the Company to the Investor deducted from the Investment Amount of the first Purchase Notice.

 

“DTC” shall
mean The Depository Trust Company, or any successor performing substantially the same function for the Company.

 

“DTC/FAST Program”
shall mean the DTC’s Fast Automated Securities Transfer Program.

 

“DWAC”
shall mean Deposit Withdrawal at Custodian as defined by the DTC.

 

“DWAC Eligible”
shall mean that (a) the Common Stock is eligible at DTC for full services pursuant to DTC’s Operational Arrangements, including,
without limitation, transfer through DTC’s DWAC system, (b) the Company has been approved (without revocation) by the DTC’s
underwriting department, (c) the Transfer Agent is approved as an agent in the DTC/FAST Program, (d) the Securities are otherwise eligible
for delivery via DWAC, and (e) the Transfer Agent does not have a policy prohibiting or limiting delivery of the Securities, as applicable,
via DWAC.

 

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

 

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

 

“Exchange Cap”
shall have the meaning set forth in Section 7.1(d).

 

“Execution Date”
shall have the meaning set forth in the first paragraph of this Agreement.

 

“Floor Price”
shall mean $0.25.

 

 

 

    	 	2	 

     

    

 

“Indemnified Party”
shall have the meaning specified in Section 9.1.

 

“Indemnifying Party”
shall have the meaning specified in Section 9.1.

 

“Indemnity Notice”
shall have the meaning specified in Section 9.3(b).

 

“Investment Amount”
shall mean the Purchase Notice Amount less Clearing Costs.

 

“Investment Limit”
shall mean $500,000, subject to increase at the sole discretion of the Investor.

 

“Investor”
shall have the meaning specified in the preamble to this Agreement.

 

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

 

“Material Adverse
Effect” shall mean any effect on the business, operations, properties, or financial condition of the Company that is material
and adverse to the Company and/or any condition, circumstance, or situation that would prohibit or otherwise materially interfere with
the ability of the Company to enter into and perform its obligations under any Transaction Document.

 

“Minimum Price”
shall have the meaning specified in Section 7.1(d).

 

“Person”
shall mean an individual, a corporation, a partnership, an association, a trust or other entity or organization, including a government
or political subdivision or an agency or instrumentality thereof.

 

“PEA Period”
shall mean the period commencing at 9:30 a.m., New York City time, on the fifth (5th) Business Day immediately prior to the filing of
any post-effective amendment to the Registration Statement or any new registration statement, or any annual and quarterly report, and
ending at 9:30 a.m., New York City time, on the Business Day immediately following (i) the effective date of such post-effective amendment
of the Registration Statement or such new registration statement, or (ii) the date of filing of such annual and quarterly report, as applicable.

 

“Principal Market”
shall mean any of the national exchanges (i.e. NYSE, AMEX, Nasdaq), or principal quotation systems (i.e. OTCQX, OTCQB, OTC Pink, the OTC
Bulletin Board), or other principal exchange or recognized quotation system which is at the time the principal trading platform or market
for the Common Stock.

 

“Purchase Amount”
means a dollar amount equal to the closing price of the Common Stock on the Business Day before the date of delivery of a Purchase Notice
(Exhibit A) multiplied by the applicable number of shares listed in the applicable Purchase Notice.

 

“Purchase Notice”
shall mean a written notice from Company, substantially in the form of Exhibit A hereto, to the Investor setting forth the Purchase
Notice Shares which the Company requires the Investor to purchase pursuant to the terms of this Agreement.

 

“Purchase Notice
Amount” shall mean the applicable Purchase Notice Shares referenced in the Purchase Notice multiplied by the Purchase Price.

 

“Purchase Notice
Date” shall have the meaning specified in Section 2.2(a).

 

“Purchase Notice
Limit” shall mean for any Purchase Notice the Investor’s committed obligation under each Purchase Notice shall not exceed
the Investment Limit; the maximum amount of Purchase Notice Shares the Company may require the Investor to purchase per each Purchase
Notice shall be the lesser of: (i) 30% of the Average Daily Trading Volume or (ii) the Investment Limit divided by the highest closing
price of the Common Stock over the most recent five (5) Business Days immediately preceding receipt of Exhibit A. Notwithstanding the
forgoing, the Investor may waive the Purchase Notice Limit at any time to allow the Investor to purchase additional shares under a Purchase
Notice.

 

 

 

 

    	 	3	 

     

    

 

“Purchase Notice
Shares” shall mean all shares of Common Stock that the Company shall be entitled to issue as set forth in all Purchase Notices
in accordance with the terms and conditions of this Agreement.

 

“Purchase Price”
shall mean the product of i) the lowest daily VWAP of the Common Stock during the Valuation Period and ii) the Discount Percentage.

 

“Registration Statement”
shall have the meaning specified in Section 4.15.

 

“Regulation D”
shall mean Regulation D promulgated under the Securities Act.

 

“Rule 144”
shall mean Rule 144 under the Securities Act or any similar provision then in force under the Securities Act.

 

“SEC” shall
mean the United States Securities and Exchange Commission.

 

“SEC Documents”
shall have the meaning specified in Section 4.5.

 

“Securities”
mean the Purchase Notice Shares and all Commitment Shares issued to the Investor by the Company pursuant to this Agreement.

 

“Securities Act”
shall mean the Securities Act of 1933, as amended.

 

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

 

"Termination”
shall mean any termination outlined in Section 10.5.

 

“Transaction Documents”
shall mean this Agreement, and all schedules and exhibits hereto and thereto.

 

“Transfer Agent”
shall mean Vstock Transfer (the current transfer agent of the Company), and any successor transfer agent of the Company.

 

“Valuation Period”
shall mean the three (3) consecutive Business Days commencing on and including the Purchase Notice Date. For avoidance of doubt, the Purchase
Notice Date shall be the first Business Day in the Valuation Period.

 

“VWAP”
means, for any security as of any date, the dollar volume-weighted average price for such security on the Principal Market (or, if the
Principal Market is not the principal trading market for such security, then on the principal securities exchange or securities market
on which such security is then traded), during the period beginning at 9:30 a.m., New York time, and ending at 4:00 p.m., New York time,
as reported by E*TRADE Securities LLC graph study function or Bloomberg through its “VAP” function (set to 09:30:01 start
time and 15:59:59 end time) or, if the foregoing does not apply, the dollar volume-weighted average price of such security in the over-the-counter
market on the electronic bulletin board for such security during the period beginning at 9:30 a.m., New York time, and ending at 4:00
p.m., New York time, as reported by Bloomberg, or, if no dollar volume-weighted average price is reported for such security by Bloomberg
for such hours, the average of the highest closing bid price and the lowest closing ask price of any of the market makers for such security
as reported in the “pink sheets” by OTC Markets Group Inc. (formerly Pink Sheets LLC). If the VWAP cannot be calculated for
such security on such date on any of the foregoing bases, the VWAP of such security on such date shall be the fair market value as mutually
determined by the Company and the Investor. If the Company and the Investor are unable to agree upon the fair market value of such security,
then such dispute shall be resolved in accordance with the procedures in Section 10.16. All such determinations shall be appropriately
adjusted for any share dividend, share split, share combination, recapitalization or other similar transaction during such period.

 

 

 

 

    	 	4	 

     

    

 

 

ARTICLE II

PURCHASE AND SALE OF COMMON STOCK

 

Section 2.1           
PURCHASE NOTICES. Upon the terms and conditions set forth herein (including, without limitation, the provisions of Article
VII), after ten (10) Business Days following the Execution Date (unless waived by the Investor), the Company shall have the right, but
not the obligation, to require the Investor, by its delivery to the Investor of a Purchase Notice from time to time, to purchase Purchase
Notice Shares provided that the amount of Purchase Notice Shares shall not exceed the Purchase Notice Limit or the Beneficial Ownership
Limitation set forth in Section 7.2(g), (each such purchase, a “Closing”). The Company may not deliver a subsequent
Purchase Notice until the Closing of an active Purchase Notice, except if waived by the Investor in writing. Furthermore, the Company
shall not deliver any Purchase Notices to the Investor during the PEA Period. Notwithstanding the foregoing, the Company may not submit
a Purchase Notice to the Investor if the Purchase Amount is less than $30,000 or if the most recent closing price of the Common Stock
is below the Floor Price, unless waived by the Investor in writing.

 

Section 2.2             MECHANICS.

 

(a)                   PURCHASE NOTICE. At any time and from time to time during the Commitment Period, except as provided in this Agreement, the
Company may deliver a Purchase Notice to Investor, subject to satisfaction of the conditions set forth in Section 7 and otherwise provided
herein. The Company shall deliver the Purchase Notice Shares as DWAC Shares to the Designated Brokerage Account alongside the delivery
of the Purchase Notice. A Purchase Notice shall be deemed delivered on the Business Day (i) Exhibit A (Form of Purchase Notice) is received
by 9:00 a.m. New York time by email by the Investor and (ii) the DWAC of the applicable Purchase Notice Shares has been initiated and
completed as confirmed by the Investor’s Designated Brokerage Account by 9:00 a.m. New York time (the “Purchase Notice
Date"). If Exhibit A is received after 9:00 a.m. New York time or the DWAC of the applicable Purchase Notice Shares has not been
completed as confirmed by the Investor’s Designated Brokerage Account by 9:00 a.m. New York time, then the next Business Day shall
be the Purchase Notice Date, unless waived by Investor. Each party shall use its best efforts to perform or fulfill all conditions and
obligations to be performed or fulfilled by it under this Agreement so that the transactions contemplated hereby shall be consummated
as soon as practicable. Each party also agrees that it shall use its best efforts to take, or cause to be taken, all actions and to do,
or cause to be done, all things necessary, proper or advisable under applicable laws and regulations to consummate and make effective
Section 2.2(a) of this Agreement and the transactions contemplated herein.

 

(b)                  CLOSING. The Closing of a Purchase Notice shall occur one (1) Business Day following the Valuation Period (the “Closing
Date”); whereby the Investor shall deliver to the Company, by 5:00 p.m. New York time on the Closing Date, the applicable Investment
Amount by wire transfer of immediately available funds to an account designated by the Company.

 

ARTICLE III

REPRESENTATIONS AND WARRANTIES OF INVESTOR

 

The Investor represents and
warrants to the Company that:

 

Section 3.1             INTENT. The Investor is entering into this Agreement for its own account and the Investor has no present arrangement (whether
or not legally binding) at any time to sell the Securities to or through any Person in violation of the Securities Act or any applicable
state securities laws; provided, however, that the Investor reserves the right to dispose of the Securities at any time
in accordance with federal and state securities laws applicable to such disposition.

 

Section 3.2             NO LEGAL ADVICE FROM THE COMPANY. The Investor acknowledges that it has had the opportunity to review this Agreement and
the transactions contemplated by this Agreement with its own legal counsel and investment and tax advisors. The Investor is relying solely
on such counsel and advisors and not on any statements or representations of the Company or any of its representatives or agents for legal,
tax or investment advice with respect to this investment, the transactions contemplated by this Agreement or the securities laws of any
jurisdiction.

 

Section 3.3             ACCREDITED INVESTOR. The Investor is an accredited investor as defined in Rule 501(a)(3) of Regulation D, and the Investor
has such experience in business and financial matters that it is capable of evaluating the merits and risks of an investment in the Securities.
The Investor acknowledges that an investment in the Securities is speculative and involves a high degree of risk.

 

 

 

 

 

 

    	 	5	 

     

    

 

Section 3.4            AUTHORITY. The Investor has the requisite power and authority to enter into and perform its obligations under the Transaction
Documents and to consummate the transactions contemplated hereby and thereby. The execution and delivery of the Transaction Documents
and the consummation by it of the transactions contemplated hereby and thereby have been duly authorized by all necessary action and no
further consent or authorization of the Investor is required. The Transaction Documents to which it is a party has been duly executed
by the Investor, and when delivered by the Investor in accordance with the terms hereof, will constitute the valid and binding obligation
of the Investor enforceable against it in accordance with its terms, subject to applicable bankruptcy, insolvency, or similar laws relating
to, or affecting generally the enforcement of, creditors’ rights and remedies or by other equitable principles of general application.

 

Section 3.5             NOT AN AFFILIATE. The Investor is not an officer, director, or “affiliate” (as that term is defined in Rule
405 of the Securities Act) of the Company.

 

Section 3.6             ORGANIZATION AND STANDING. The Investor is an entity duly incorporated or formed, validly existing and in good standing
under the laws of the jurisdiction of its incorporation or formation with full right, corporate, partnership, limited liability company
or similar power and authority to enter into and to consummate the transactions contemplated by the Transaction Documents.

 

Section 3.7             ABSENCE OF CONFLICTS. The execution and delivery of the Transaction Documents and the consummation of the transactions contemplated
hereby and thereby and compliance with the requirements hereof and thereof, will not (a) violate any law, rule, regulation, order, writ,
judgment, injunction, decree or award binding on the Investor, (b) violate any provision of any indenture, instrument or agreement to
which the Investor is a party or is subject, or by which the Investor or any of its assets is bound, or conflict with or constitute a
material default thereunder, (c) result in the creation or imposition of any lien pursuant to the terms of any such indenture, instrument
or agreement, or constitute a breach of any fiduciary duty owed by the Investor to any third party, or (d) require the approval of any
third-party (that has not been obtained) pursuant to any material contract, instrument, agreement, relationship or legal obligation to
which the Investor is subject or to which any of its assets, operations or management may be subject.

 

Section 3.8            DISCLOSURE; ACCESS TO INFORMATION. The Investor had an opportunity to review copies of the SEC Documents filed on behalf
of the Company and has had access to all publicly available information with respect to the Company.

 

Section 3.9            MANNER OF SALE. At no time was the Investor presented with or solicited by or through any leaflet, public promotional meeting,
television advertisement or any other form of general solicitation or advertising.

 

ARTICLE IV

REPRESENTATIONS AND WARRANTIES OF THE COMPANY

 

Except as set forth in the SEC
Documents and the Disclosure Schedules, which Disclosure Schedules shall be deemed a part hereof and shall qualify any representation
or otherwise made herein to the extent of the disclosure contained in the corresponding section of the Disclosure Schedules, the Company
represents and warrants to the Investor, as of the Execution Date, that:

 

Section 4.1            ORGANIZATION OF THE COMPANY. The Company 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. The Company is not in violation or default of any of
the provisions of its certificate of incorporation, bylaws or other organizational or charter documents. The Company is duly qualified
to conduct business and is in good standing as a foreign corporation in each jurisdiction in which the nature of the business conducted
or property owned by it makes such qualification necessary, except where the failure to be so qualified or in good standing, as the case
may be, could not have or reasonably be expected to result in a Material Adverse Effect and no proceeding has been instituted in any such
jurisdiction revoking, limiting or curtailing or seeking to revoke, limit or curtail such power and authority or qualification. The Company
has no Subsidiaries.

 

 

 

 

    	 	6	 

     

    

 

 

Section 4.2            AUTHORITY. The Company has the requisite corporate power and authority to enter into and perform its obligations under the
Transaction Documents. The execution and delivery of the Transaction Documents by the Company and the consummation by it of the transactions
contemplated hereby and thereby have been duly authorized by all necessary corporate action and no further consent or authorization of
the Company or its Board of Directors or stockholders is required. The Transaction Documents have been duly executed and delivered by
the Company and constitutes a valid and binding obligation of the Company enforceable against the Company in accordance with its terms,
except as such enforceability may be limited by applicable bankruptcy, insolvency, or similar laws relating to, or affecting generally
the enforcement of, creditors’ rights and remedies or by other equitable principles of general application.

 

Section 4.3            CAPITALIZATION. As of the Execution Date, the authorized Common Stock of the Company consists of 100,000,000 shares of Common
Stock, of which approximately 12,514,763 shares of Common Stock are issued and outstanding as of the Execution Date. As of the Execution
Date, the authorized Preferred Stock of the Company consists of 10,000,000 shares of Preferred Stock, of which no shares of Preferred
Stock are issued and outstanding as of the Execution Date. The Company has not issued any capital stock since its most recently filed
registration statement under the Securities Act, other than pursuant to the exercise of employee stock options under the Company’s
stock option plans, the issuance of shares of Common Stock to employees pursuant to the Company’s employee stock purchase plans
and pursuant to the conversion and/or exercise of Common Stock Equivalents outstanding as of the date of the registration statement filed
under the Securities 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 in the SEC Documents, there are no outstanding
options, warrants, scrip rights to subscribe to, calls or commitments of any character whatsoever relating to, or securities, rights or
obligations convertible into or exercisable or exchangeable for, or giving any Person any right to subscribe for or acquire any shares
of Common Stock, or contracts, commitments, understandings or arrangements by which the Company is or may become bound to issue additional
shares of Common Stock or Common Stock Equivalents. The issuance and sale of the Securities will not obligate the Company to issue shares
of Common Stock or other securities to any Person (other than the Investor) 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 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.

 

Section 4.4             LISTING AND MAINTENANCE REQUIREMENTS. The Common Stock is registered pursuant to Section 12(b) of the Exchange Act. The
Company has not, in the twelve (12) months preceding the Execution Date, received notice from the Principal 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 Principal 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.

 

Section 4.5             SEC DOCUMENTS; DISCLOSURE. 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) thereof, for the one (1)
year preceding the Execution Date (or such shorter period as the Company was required by law or regulation to file such material) (the
foregoing materials, including the exhibits thereto and documents incorporated by reference therein, being collectively referred to herein
as the “SEC Documents”) on a timely basis or has received a valid extension of such time of filing and has filed any
such SEC Documents prior to the expiration of any such extension. As of their respective dates, the SEC Documents complied in all material
respects with the requirements of the Securities Act and the Exchange Act, as applicable, and other federal laws, rules and regulations
applicable to such SEC Documents, and none of the SEC Documents when filed contained any untrue statement of a material fact or omitted
to state a material fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances
under which they were made, not misleading. The financial statements of the Company included in the SEC Documents comply as to form and
substance in all material respects with applicable accounting requirements and the published rules and regulations of the SEC or other
applicable rules and regulations with respect thereto. Such financial statements have been prepared in accordance with generally accepted
accounting principles applied on a consistent basis during the periods involved (except (a) as may be otherwise indicated in such financial
statements or the notes thereto or (b) in the case of unaudited interim statements, to the extent they may not include footnotes or may
be condensed or summary statements) and fairly present in all material respects the financial position of the Company as of the dates
thereof and the results of operations and cash flows for the periods then ended (subject, in the case of unaudited statements, to normal,
immaterial, year-end audit adjustments). 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 Investor or
its agents or counsel with any information that it believes constitutes or might constitute material, non-public information. The Company
understands and confirms that the Investor will rely on the foregoing representation in effecting transactions in securities of the Company.

 

 

 

 

    	 	7	 

     

    

 

 

Section 4.6             VALID ISSUANCES. 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 non-assessable, free and clear of all Liens imposed by the Company other than
restrictions on transfer provided for in the Transaction Documents.

 

Section 4.7             NO CONFLICTS. The execution, delivery and performance of the Transaction Documents by the Company and the consummation by
the Company of the transactions contemplated hereby and thereby, including, without limitation, the issuance of the Purchase Notice Shares,
do not and will not: (a) result in a violation of the Company’s certificate or articles of incorporation, by-laws or other organizational
or charter documents, (b) conflict with, or constitute a material default (or an event that with notice or lapse of time or both would
become a material default) under, result in the creation of any Lien upon any of the properties or assets of the Company, or give to others
any rights of termination, amendment, acceleration or cancellation of, any agreement, indenture, instrument or any “lock-up”
or similar provision of any underwriting or similar agreement to which the Company is a party, or (c) result in a violation of any federal,
state or local law, rule, regulation, order, judgment or decree (including federal and state securities laws and regulations) applicable
to the Company or by which any property or asset of the Company is bound or affected (except for such conflicts, defaults, terminations,
amendments, accelerations, cancellations and violations as would not, individually or in the aggregate, have a Material Adverse Effect)
nor is the Company otherwise in violation of, conflict with or in default under any of the foregoing. The business of the Company is not
being conducted in violation of any law, ordinance or regulation of any governmental entity, except for possible violations that either
singly or in the aggregate do not and will not have a Material Adverse Effect. The Company is not required under federal, state or local
law, rule or regulation to obtain any consent, authorization or order of, or make any filing or registration with, any court or governmental
agency in order for it to execute, deliver or perform any of its obligations under the Transaction Documents (other than any SEC or state
securities filings that may be required to be made by the Company in connection with the issuance of Purchase Notice Shares or subsequent
to any Closing or any registration statement that may be filed pursuant hereto); provided that, for purposes of the representation made
in this sentence, the Company is assuming and relying upon the accuracy of the relevant representations and agreements of Investor herein.

 

Section 4.8             NO MATERIAL ADVERSE EFFECT. No event has occurred that would have a Material Adverse Effect on the Company that has not
been disclosed in subsequent SEC Documents.

 

Section 4.9            LITIGATION AND OTHER PROCEEDINGS. Except as disclosed in the SEC Documents and the Disclosure Schedule, there are no material
actions, suits, investigations, inquiries or similar proceedings (however any governmental agency may name them) pending or, to the knowledge
of the Company, threatened against or affecting the Company or its properties, nor has the Company received any written or oral notice
of any such action, suit, proceeding, inquiry or investigation, which would have a Material Adverse Effect. No judgment, order, writ,
injunction or decree or award has been issued by or, to the knowledge of the Company, requested of any court, arbitrator or governmental
agency which would have a Material Adverse Effect. There has not been, and to the knowledge of the Company, there is not pending or contemplated,
any investigation by the SEC involving the Company or any current or former director or officer of the Company.

 

Section 4.10          REGISTRATION RIGHTS. Except as set forth in Schedule 4.10, no Person (other than the Investor) has any right to cause the
Company to effect the registration under the Securities Act of any securities of the Company.

 

Section 4.11           ACKNOWLEDGMENT REGARDING INVESTOR’S PURCHASE OF SECURITIES. The Company acknowledges and agrees that the Investor
is acting solely in the capacity of an arm’s length purchaser with respect to the Transaction Documents and the transactions contemplated
hereby and thereby and that the Investor is not (i) an officer or director of the Company, or (ii) an “affiliate” (as defined
in Rule 144) of the Company. The Company further acknowledges that the Investor is not acting as a financial advisor or fiduciary of the
Company (or in any similar capacity) with respect to the Transaction Documents and the transactions contemplated hereby and thereby, and
any advice given by the Investor or any of its representatives or agents in connection with the Transaction Documents and the transactions
contemplated hereby and thereby is merely incidental to the Investor’s purchase of the Purchase Notice Shares. The Company further
represents to the Investor that the Company’s decision to enter into the Transaction Documents has been based solely on the independent
evaluation by the Company and its representatives.

 

Section 4.12           NO GENERAL SOLICITATION; PLACEMENT AGENT. Neither the Company, nor any Person acting on its behalf, has engaged in any form
of general solicitation or general advertising (within the meaning of Regulation D under the Securities act) in connection with the offer
or sale of the Securities.

 

 

 

 

    	 	8	 

     

    

 

Section 4.13           NO INTEGRATED OFFERING. Except as set forth on the Disclosure Schedule, none of the Company, its affiliates, and any Person
acting on their behalf has, directly or indirectly, made any offers or sales of any security or solicited any offers to buy any security,
under circumstances that would cause this offering of the Securities to be integrated with prior offerings for purposes of any applicable
stockholder approval provisions, including, without limitation, under the rules and regulations of any exchange or automated quotation
system on which any of the securities of the Company are listed or designated, but excluding stockholder consents required to authorize
and issue the Securities or waive any anti-dilution provisions in connection therewith.

 

Section 4.14          OTHER COVERED PERSONS. The Company is not aware of any Person that has been or will be paid (directly or indirectly) remuneration
for solicitation of the Investor in connection with the sale of any Regulation D Securities.

 

Section 4.15          REGISTRATION STATEMENT. The Company has prepared and filed a Registration Statement on Form S-3 with the SEC in accordance
with the provisions of the Securities Act, which was declared effective by order of the SEC on April 18, 2022 (File No. 333-264227) (the
“Base Registration Statement”). The Base Registration Statement is effective under the Securities Act and the Company
has not received any written notice that the SEC has issued or intends to issue a stop order or other similar order with respect to the
Base Registration Statement or the prospectus or that the SEC otherwise has (i) suspended or withdrawn the effectiveness of the Base Registration
Statement or (ii) issued any order preventing or suspending the use of the prospectus or any prospectus supplement, in either case, either
temporarily or permanently or intends or has threatened in writing to do so. The “Plan of Distribution” section of the prospectus
permits the issuance of the Securities hereunder. The SEC has not notified the Company of any objection to the use of the form of the
Base Registration Statement pursuant to Rule 401(g)(1) of the Securities Act. The Company was at the time of the filing of the Registration
Statement eligible to use Form S-3. The Company is eligible to use Form S-3 under the Securities Act and it meets the transaction
requirements with respect to the securities being sold pursuant to this offering, subject to the applicable limits during any twelve (12)
month period as set forth in General Instruction I.B.6 of Form S-3. The Company shall issue all Securities issued pursuant to this
Agreement under the Base Registration Statement and attendant prospectus as contemplated by Section 6.3 herein, and all of such shares
shall be freely tradeable by the Investor upon its receipt of such shares. All corporate action required to be taken for the authorization,
issuance and sale of the Purchase Notice Shares, and Commitment Shares has been duly and validly taken. The Purchase Notice Shares, and
the Commitment Shares conform in all material respects to all statements with respect thereto contained in the Base Registration Statement,
the prospectus and the prospectus supplement.

 

ARTICLE V

COVENANTS OF INVESTOR

 

Section 5.1             SHORT SALES AND CONFIDENTIALITY. Neither the Investor, nor any affiliate of the Investor acting on its behalf or pursuant
to any understanding with it, will execute any Short Sales during the period from the Execution Date to the end of the Commitment Period.
For the purposes hereof, and in accordance with Regulation SHO, the sale after delivery of the Purchase Notice of such number of shares
of Common Stock reasonably expected to be purchased under the Purchase Notice shall not be deemed a Short Sale. The parties acknowledge
and agree that during the Valuation Period, the Investor may contract for, or otherwise effect, the resale of the subject purchased Purchase
Notice Shares to third-parties. The Investor shall, until such time as the transactions contemplated by the Transaction Documents are
publicly disclosed by the Company in accordance with the terms of the Transaction Documents, maintain the confidentiality of the existence
and terms of this transaction and the information included in the Transaction Documents. “Short Sales” shall mean “short
sales” as defined in Rule 200 promulgated under Regulation SHO under the Exchange Act.

 

Section 5.2             COMPLIANCE WITH LAW; TRADING IN SECURITIES. The Investor’s trading activities with respect to shares of Common Stock
will be in compliance with all applicable state and federal securities laws and regulations and the rules and regulations of FINRA and
the Principal Market.

 

Section 5.3            LEAK OUT. On any given Business Day, in the event that the closing price of the Common Stock on the immediately preceding
Business Day is lower than the Minimum Price, the Investor shall not sell on that Business Day more than ten percent (10%) of the total
amount of Commitment Shares issued pursuant to this Agreement.

 

 

 

 

    	 	9	 

     

    

 

ARTICLE VI

COVENANTS OF THE COMPANY

 

Section 6.1             LISTING OF COMMON STOCK. The Company shall use commercially reasonable best efforts to maintain, so long as any shares of
Common Stock shall be so listed, the listing, if required, of all such Common Stock on the Principal Market from time to-time issuable
hereunder. The Company shall use its commercially reasonable best efforts to continue the listing or quotation and trading of the Common
Stock on the Principal Market (including, without limitation, maintaining sufficient net tangible assets, if required) and will comply
in all respects with the Company’s reporting, filing and other obligations under the bylaws or rules of the Principal Market.

 

Section 6.2            FILING OF CURRENT REPORT. The Company agrees that it shall file a Current Report on Form 8-K, including the Transaction
Documents as exhibits thereto, with the SEC within the time required by the Exchange Act, relating to the execution of the transactions
contemplated by, and describing the material terms and conditions of, the Transaction Documents (the “Current Report”).
The Company shall permit the Investor to review and comment upon the final pre-filing draft version of the Current Report at least two
(2) Business Days prior to its filing with the SEC, and the Company shall give reasonable consideration to all such comments. The Investor
shall use its reasonable best efforts to comment upon the final pre-filing draft version of the Current Report within one (1) Business
Day from the date the Investor receives it from the Company.

 

Section 6.3             FILING OF REGISTRATION STATEMENT. The Company shall file with the SEC, one (1) Business Day from the Execution Date, a prospectus
supplement covering the offering and sale of the Purchase Notice Shares, and the Commitment Shares. The prospectus supplement shall relate
to the transactions contemplated by, and describing the material terms and conditions of, this Agreement, containing required information
previously omitted at the time of effectiveness of the Base Registration Statement in reliance on Rule 430B under the Securities Act,
and disclosing all information relating to the transactions contemplated hereby required to be disclosed in the Base Registration Statement
and the prospectus as of the date of the prospectus supplement, including, without limitation, information required to be disclosed in
the section captioned “Plan of Distribution” in the prospectus. The Company shall permit the Investor to review and comment
upon the prospectus supplement within a reasonable time prior to their filing with the SEC, the Company shall give reasonable consideration
to all such comments, and the Company shall not file the Current Report or the prospectus supplement with the SEC in a form to which the
Investor reasonably objects. The Investor shall furnish to the Company such information regarding itself, the Company’s securities
beneficially owned by the Investor and the intended method of distribution thereof, including any arrangement between the Investor and
any other person or relating to the sale or distribution of the Company’s securities, as shall be reasonably requested by the Company
in connection with the preparation and filing of the Current Report and the prospectus supplement, and shall otherwise cooperate with
the Company as reasonably requested by the Company in connection with the preparation and filing of the Current Report and the prospectus
supplement with the SEC. The Company shall have no knowledge of any untrue statement (or alleged untrue statement) of a material fact
or omission (or alleged omission) of a material fact required to be stated therein or necessary to make the statements therein, in light
of the circumstances under which they were made, not misleading, in any effective registration statement filed or any post-effective amendment
or prospectus which is a part of the foregoing. The Company shall promptly give the Investor notice of any event (including the passage
of time) which makes the final prospectus not to be in compliance with Section 5(b) or 10 of the Securities Act and shall use its best
efforts thereafter to file with the SEC any Post-Effective Amendment to the Base Registration Statement, amended prospectus or prospectus
supplement in order to comply with Section 5(b) or 10 of the Securities Act.

 

Section 6.4             ISSUANCE OF COMMITMENT SHARES. In consideration for the Investor’s execution and delivery of, and agreement to perform
under this Agreement, the Company shall cause the Transfer Agent to issue 140,186 shares of Common Stock to the Investor as a commitment
fee (the “Commitment Shares”). For the avoidance of doubt, all of the Commitment Shares shall be fully earned as of
the Execution Date, and the issuance of the Commitment Shares is not contingent upon any other event or condition, including, without
limitation, the Company’s submission of a Purchase Notice to the Investor, the filing of a prospectus supplement, and irrespective
of any termination of this Agreement. The Company shall include on any Registration Statement filed with the SEC, all Commitment Shares,
provided that, in addition to all other remedies at law or in equity or otherwise under this Agreement, failure to do so will result in
liquidated damages of $250,000.00, being immediately due and payable to the Investor at its election in the form of cash payment. On the
Business Day following the Execution Date, the Company shall cause its Transfer Agent to DWAC to the Investor’s Designated Brokerage
Account the Commitment Shares.

 

 

 

 

    	 	10	 

     

    

 

Section 6.5            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 6.2 and otherwise provided herein, the Company covenants and agrees
that neither it, nor any other Person acting on its behalf will provide the Investor or its agents or counsel with any information that
constitutes, or the Company reasonably believes constitutes, material non-public information, unless prior thereto the Investor shall
have consented in writing to the receipt of such information and agreed with the Company to keep such information confidential. The Company
understands and confirms that the Investor 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 the Investor without such prior written consent, the Company
hereby covenants and agrees that the Investor 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 Investor shall remain subject to applicable law. The Company represents that as of the Execution Date, except with respect
to the material terms and conditions of the transaction contemplated by the Transaction Documents, neither it nor any other Person acting
on its behalf has previously provided the Investor or its agents or counsel with any information that constitutes, or the Company reasonably
believes constitutes, material non-public information. After the Execution Date, to the extent that any notice or communication made by
the Company, or information provided by the Company, to the Investor 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 the Investor 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 provides any material, non-public information to the Investor without its prior written consent, and it fails
to immediately (no later than that Business Day or by 9:00 am New York City time the next Business Day) file a Form 8-K disclosing this
material, non-public information, it shall pay the Investor as partial liquidated damages and not as a penalty a sum equal to $1,000 per
day beginning with the day the information is disclosed to the Investor and ending and including the day the Form 8-K disclosing this
information is filed.

 

Section 6.6             SUBSEQUENT FINANCING; VARIABLE RATE TRANSACTIONS.

 

(a)                 
SUBSEQUENT FINANCING. Except as set forth on the Disclosure Schedule, from the Execution Date until 30 days thereafter,
the Company covenants and agrees that it will not, without the prior written consent of the Investor, enter into any agreement with any
other party or enter into any transaction (or series of transactions) resulting in, committing to, taking any action regarding, or otherwise
involving the issuance of any Common Stock, Common Stock Equivalents or any other equity securities of the Company.

 

(b)                 
VARIABLE RATE TRANSACTIONS. From the Execution Date until the end of the Commitment Period, the Company shall be prohibited
from entering into any “equity line” or similar transaction whereby an investor is irrevocably bound to purchase securities
over a period of time from the Company at a price based on the market price of the Common Stock at the time of such purchase; provided, however,
that this Section 6.5(b) shall not be deemed to prohibit the issuance of shares of Common Stock pursuant to an “at-the-market
offering” by the Company through a registered broker-dealer acting as agent of the Company pursuant to a written agreement between
the Company and such registered broker-dealer. The Investor shall be entitled to seek injunctive relief against the Company to preclude
any such issuance, which remedy shall be in addition to any right to collect damages, without the necessity of showing economic loss and
without any bond or other security being required.

 

ARTICLE VII

CONDITIONS TO DELIVERY OF

PURCHASE NOTICE AND CONDITIONS TO CLOSING

 

Section 7.1             CONDITIONS PRECEDENT TO THE RIGHT OF THE COMPANY TO ISSUE AND SELL PURCHASE NOTICE SHARES. The right of the Company to issue
and sell the Purchase Notice Shares to the Investor is subject to the satisfaction of each of the conditions set forth below:

 

(a)                 
ACCURACY OF INVESTOR’S REPRESENTATIONS AND WARRANTIES. The representations and warranties of the Investor shall be
true and correct in all material respects as of the date of this Agreement and as of the date of each Closing as though made at each such
time.

 

 

 

    	 	11	 

     

    

 

 

(b)                 
PERFORMANCE BY INVESTOR. Investor shall have performed, satisfied and complied in all respects with all covenants, agreements
and conditions required by this Agreement to be performed, satisfied or complied with by the Investor at or prior to such Closing.

 

(c)                 
PERFORMANCE BY INVESTOR. Investor shall have performed, satisfied and complied in all respects with all covenants, agreements
and conditions required by this Agreement to be performed, satisfied or complied with by the Investor at or prior to such Closing.

 

(d)                 
PRINCIPAL MARKET REGULATION. Notwithstanding anything in this Agreement to the contrary, and in addition to the limitations
set forth herein, the Company shall not issue more than 2,501,700 shares (including the Commitment Shares) of Common Stock (the "Exchange
Cap") under this Agreement, which equals 19.99% of the Company’s outstanding shares of Common Stock as of the Execution
Date, unless stockholder approval is obtained to issue in excess of the Exchange Cap; provided, however, that
the foregoing limitation shall not apply if at any time the Exchange Cap is reached and at all times thereafter the average price paid
for all shares of Common Stock issued under this Agreement is equal to or greater than $1.23 (the "Minimum Price"), a
price equal to the lower of (i) the Nasdaq Official Closing Price immediately preceding the execution of this Agreement or (ii) the arithmetic
average of the five (5) Nasdaq Official Closing Prices for the Common Stock immediately preceding the execution of this Agreement, as
calculated in accordance with the rules of the Principal Market (in such circumstance, for purposes of the Principal Market, the transaction
contemplated hereby would not be "below market" and the Exchange Cap would not apply). Notwithstanding the foregoing, the Company
shall not be required or permitted to issue, and the Investor shall not be required to purchase, any shares of Common Stock under this
Agreement if such issuance would violate the rules or regulations of the Principal Market. The Company may, in its sole discretion, determine
whether to obtain stockholder approval to issue more than 19.99% of its outstanding shares of Common Stock hereunder if such issuance
would require stockholder approval under the rules or regulations of the Principal Market. The Exchange Cap shall be reduced, on a share-for-share
basis, by the number of shares of Common Stock issued or issuable that may be aggregated with the transactions contemplated by this Agreement
under applicable rules of the Principal Market.

 

Section 7.2            CONDITIONS PRECEDENT TO THE OBLIGATION OF INVESTOR TO PURCHASE THE PURCHASE NOTICE SHARES. The obligation of the Investor
hereunder to purchase the Purchase Notice Shares is subject to the satisfaction of each of the following conditions:

 

(a)                 
EFFECTIVE REGISTRATION STATEMENT. The Registration Statement, and any amendment or supplement thereto, shall remain effective
for the offering of the Securities and (i) the Company shall not have received notice that the SEC has issued or intends to issue a stop
order with respect to such Registration Statement or that the SEC otherwise has suspended or withdrawn the effectiveness of such Registration
Statement, either temporarily or permanently, or intends or has threatened to do so and (ii) no other suspension of the use of, or withdrawal
of the effectiveness of, such Registration Statement or related prospectus shall exist. The Investor shall not have received any notice
from the Company that the prospectus and/or any prospectus supplement fails to meet the requirements of Section 5(b) or Section 10 of
the Securities Act.

 

(b)                 
ACCURACY OF THE COMPANY’S REPRESENTATIONS AND WARRANTIES. The representations and warranties of the Company shall
be true and correct in all material respects as of the date of this Agreement and as of the date of each Closing (except for representations
and warranties specifically made as of a particular date).

 

(c)                 
PERFORMANCE BY THE COMPANY. The Company shall have performed, satisfied and complied in all material respects with all covenants,
agreements and conditions required by this Agreement to be performed, satisfied or complied with by the Company.

 

(d)                 
NO INJUNCTION. No statute, rule, regulation, executive order, decree, ruling or injunction shall have been enacted, entered,
promulgated or adopted by any court or governmental authority of competent jurisdiction that prohibits or directly and materially adversely
affects any of the transactions contemplated by the Transaction Documents, and no proceeding shall have been commenced that may have the
effect of prohibiting or materially adversely affecting any of the transactions contemplated by the Transaction Documents.

 

 

 

 

    	 	12	 

     

    

 

(e)                 
ADVERSE CHANGES. Since the date of filing of the Company’s most recent annual report on Form 10-Q, no event that had
or is reasonably likely to have a Material Adverse Effect has occurred.

 

(f)                  
NO SUSPENSION OF TRADING IN OR DELISTING OF COMMON STOCK. The trading of the Common Stock shall not have been suspended
by the SEC or the Principal Market, or otherwise halted for any reason, and the Common Stock shall have been approved for listing or quotation
on and shall not have been delisted from or no longer quoted on the Principal Market. In the event of a suspension, delisting, or halting
for any reason, of the trading of the Common Stock during the Valuation Period, as contemplated by this Section 7.2(f), the Investor shall
purchase the Purchase Notice Shares in the respective Purchase Notice at a value equal to the par value of the Company’s Common
Stock.

 

(g)                 
BENEFICIAL OWNERSHIP LIMITATION. The number of Purchase Notice Shares then to be purchased by the Investor shall not exceed
the number of such shares that, when aggregated with all other shares of Common Stock then owned by the Investor beneficially or deemed
beneficially owned by the Investor, would result in the Investor owning more than the Beneficial Ownership Limitation (as defined below),
as determined in accordance with Section 13 of the Exchange Act. For purposes of this Section 7.2(g), in the event that the amount of
Common Stock outstanding is greater or lesser on a Closing Date than on the date upon which the Purchase Notice associated with such Closing
Date is given, the amount of Common Stock outstanding on such issuance of a Purchase Notice shall govern for purposes of determining whether
the Investor, when aggregating all purchases of Common Stock made pursuant to this Agreement, would own more than the Beneficial Ownership
Limitation following a purchase on any such Closing Date. In the event the Investor claims that compliance with a Purchase Notice would
result in the Investor owning more than the Beneficial Ownership Limitation, upon request of the Company the Investor will provide the
Company with evidence of the Investor’s then existing shares beneficially or deemed beneficially owned. The “Beneficial
Ownership Limitation” shall be 4.9% of the number of shares of the Common Stock outstanding immediately prior to the issuance
of shares of Common Stock issuable pursuant to a Purchase Notice. To the extent that the Beneficial Ownership Limitation is exceeded,
the number of shares of Common Stock issuable to the Investor shall be reduced void ab initio so it does not exceed the Beneficial Ownership
Limitation.

 

(h)                 
STOCK PROMOTION. The Company shall be free from any “stock promotion” flag.

 

(i)                    NO KNOWLEDGE. The Company shall have no knowledge of any event more likely than not to have the effect of causing the effectiveness
of the Registration Statement to be suspended or any prospectus or prospectus supplement failing to meet the requirement of Sections 5(b)
or 10 of the Securities Act (which event is more likely than not to occur within the fifteen (15) Business Days following the Business
Day on which such Purchase Notice is deemed delivered).

 

(j)                    NO VIOLATION OF SHAREHOLDER APPROVAL REQUIREMENT. The issuance of the Purchase Notice Shares shall not violate the shareholder
approval requirements of the Principal Market.

 

(k)                  
DWAC ELIGIBLE. The Common Stock must be DWAC Eligible and not subject to a “DTC chill”.

 

(l)                   
SEC DOCUMENTS. All reports, schedules, registrations, forms, statements, information and other documents required to have
been filed by the Company with the SEC pursuant to the reporting requirements of the Exchange Act shall have been filed with the SEC within
the applicable time periods prescribed for such filings under the Exchange Act.

 

(m)               
EXCHANGE CAP. The Exchange Cap has not been reached (to the extent the Exchange Cap is applicable pursuant to Section 7.1(d)
hereof).

 

 

 

 

 

    	 	13	 

     

    

 

ARTICLE VIII

LEGENDS

 

Section 8.1             NO RESTRICTIVE STOCK LEGEND. No restrictive stock legend shall be placed on the share certificates representing the Purchase
Notice Shares.

 

Section 8.2              INVESTOR’S COMPLIANCE. Nothing in this Article VIII shall affect in any way the Investor’s obligations hereunder
to comply with all applicable securities laws upon the sale of the Common Stock.

 

ARTICLE IX

INDEMNIFICATION

 

Section 9.1            INDEMNIFICATION. Each party (an “Indemnifying Party”) agrees to indemnify and hold harmless the other
party along with its officers, directors, employees, and authorized agents, and each Person or entity, if any, who controls such party
within the meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act (an “Indemnified Party”) from
and against any Damages, and any action in respect thereof to which the Indemnified Party becomes subject to, resulting from, arising
out of this Agreement or relating to (i) any misrepresentation, breach of warranty or nonfulfillment of or failure to perform any covenant
or agreement on the part of the Indemnifying Party contained in this Agreement, (ii) any untrue statement or alleged untrue statement
of a material fact contained in the Registration Statement or any post-effective amendment thereof or prospectus or prospectus supplement,
or the omission or alleged omission therefrom of a material fact required to be stated therein or necessary to make the statements therein
not misleading, (iii) any untrue statement or alleged untrue statement of a material fact contained in any preliminary prospectus or contained
in the final prospectus (as amended or supplemented, if the Company files any amendment thereof or supplement thereto with the SEC) or
the omission or alleged omission to state therein any material fact necessary to make the statements made therein, in the light of the
circumstances under which the statements therein were made, not misleading, or (iv) any violation or alleged violation by the Company
of the Securities Act, the Exchange Act, any state securities law or any rule or regulation under the Securities Act, the Exchange Act
or any state securities law, as such Damages are incurred, except to the extent such Damages result primarily from the Indemnified Party’s
failure to perform any covenant or agreement contained in this Agreement or the Indemnified Party’s, recklessness or willful misconduct
in performing its obligations under this Agreement; provided, however, that the foregoing indemnity agreement shall not apply to
any Damages of an Indemnified Party to the extent, but only to the extent, arising out of or based upon any untrue statement or alleged
untrue statement or omission or alleged omission made by an Indemnifying Party in reliance upon and in conformity with written information
furnished to the Indemnifying Party by the Indemnified Party expressly for use in the Registration Statement, any post-effective amendment
thereof, prospectus, prospectus supplement thereto, or any preliminary prospectus or final prospectus (as amended or supplemented).

 

Section 9.2             INDEMNIFICATION PROCEDURE.

 

(a)                   A party that seeks indemnification under must promptly give the other party notice of any legal action. But a delay in notice does
not relieve an Indemnifying Party of any liability to any Indemnified Party, except to the extent the Indemnifying Party shows that the
delay prejudiced the defense of the action.

 

(b)                  The Indemnifying Party may participate in the defense at any time or it may assume the defense by giving notice to the Indemnified
Parties. After assuming the defense, the Indemnifying Party:

 

(i)                  must select counsel (including local counsel if appropriate) that is reasonably satisfactory to the Indemnified Parties;

 

(ii)                 is not liable to the other party for any later attorney’s fees or for any other later expenses that the Indemnified Parties
incur, except for reasonable investigation costs;

 

(iii)                must
not compromise or settle the action without the Indemnified Parties consent (which may not be unreasonably withheld); and

 

(iv)               
is not liable for any compromise or settlement made without its consent.

 

(c)                 
If the Indemnifying Party fails to assume the defense within 10 days after receiving notice of the action, the Indemnifying Party
shall be bound by any determination made in the action or by any compromise or settlement made by the Indemnified Parties, and also remains
liable to pay the Indemnified Parties’ legal fees and expenses.

 

 

    	 	14	 

     

    

 

Section 9.3            
METHOD OF ASSERTING INDEMNIFICATION CLAIMS. All claims for indemnification by any Indemnified Party under Section 9.2 shall
be asserted and resolved as follows:

 

(a)                   In
the event any claim or demand in respect of which an Indemnified Party might seek indemnity under Section 9.2 is asserted against or
sought to be collected from such Indemnified Party by a Person other than a party hereto or an affiliate thereof (a “Third Party
Claim”), the Indemnified Party shall deliver a written notification, enclosing a copy of all papers served, if any, and specifying
the nature of and basis for such Third Party Claim and for the Indemnified Party’s claim for indemnification that is being asserted
under any provision of Section 9.2 against an Indemnifying Party, together with the amount or, if not then reasonably ascertainable,
the estimated amount, determined in good faith, of such Third Party Claim (a “Claim Notice”) with reasonable promptness
to the Indemnifying Party. If the Indemnified Party fails to provide the Claim Notice with reasonable promptness after the Indemnified
Party receives notice of such Third Party Claim, the Indemnifying Party shall not be obligated to indemnify the Indemnified Party with
respect to such Third Party Claim to the extent that the Indemnifying Party’s ability to defend has been prejudiced by such failure
of the Indemnified Party. The Indemnifying Party shall notify the Indemnified Party as soon as practicable within the period ending thirty
(30) calendar days following receipt by the Indemnifying Party of either a Claim Notice or an Indemnity Notice (as defined below) (the
“Dispute Period”) whether the Indemnifying Party disputes its liability or the amount of its liability to the Indemnified
Party under Section 9.2 and whether the Indemnifying Party desires, at its sole cost and expense, to defend the Indemnified Party against
such Third Party Claim.

 

(i)                  If
the Indemnifying Party notifies the Indemnified Party within the Dispute Period that the Indemnifying Party desires to defend the Indemnified
Party with respect to the Third Party Claim pursuant to this Section 9.3(a), then the Indemnifying Party shall have the right to defend,
with counsel reasonably satisfactory to the Indemnified Party, at the sole cost and expense of the Indemnifying Party, such Third Party
Claim by all appropriate proceedings, which proceedings shall be vigorously and diligently prosecuted by the Indemnifying Party to a
final conclusion or will be settled at the discretion of the Indemnifying Party (but only with the consent of the Indemnified Party in
the case of any settlement that provides for any relief other than the payment of monetary damages or that provides for the payment of
monetary damages as to which the Indemnified Party shall not be indemnified in full pursuant to Section 9.2). The Indemnifying Party
shall have full control of such defense and proceedings, including any compromise or settlement thereof; provided, however,
that the Indemnified Party may, at the sole cost and expense of the Indemnified Party, at any time prior to the Indemnifying Party’s
delivery of the notice referred to in the first sentence of this clause (i), file any motion, answer or other pleadings or take any other
action that the Indemnified Party reasonably believes to be necessary or appropriate to protect its interests; and provided, further,
that if requested by the Indemnifying Party, the Indemnified Party will, at the sole cost and expense of the Indemnifying Party, provide
reasonable cooperation to the Indemnifying Party in contesting any Third Party Claim that the Indemnifying Party elects to contest. The
Indemnified Party may participate in, but not control, any defense or settlement of any Third Party Claim controlled by the Indemnifying
Party pursuant to this clause (i), and except as provided in the preceding sentence, the Indemnified Party shall bear its own costs and
expenses with respect to such participation. Notwithstanding the foregoing, the Indemnified Party may take over the control of the defense
or settlement of a Third Party Claim at any time if it irrevocably waives its right to indemnity under Section 9.2 with respect to such
Third Party Claim.

 

(ii)                 If the Indemnifying Party fails to notify the Indemnified Party within the Dispute Period that the Indemnifying Party desires to
defend the Third Party Claim pursuant to Section 9.3(a), or if the Indemnifying Party gives such notice but fails to prosecute vigorously
and diligently or settle the Third Party Claim, or if the Indemnifying Party fails to give any notice whatsoever within the Dispute Period,
then the Indemnified Party shall have the right to defend, at the sole cost and expense of the Indemnifying Party, the Third Party Claim
by all appropriate proceedings, which proceedings shall be prosecuted by the Indemnified Party in a reasonable manner and in good faith
or will be settled at the discretion of the Indemnified Party(with the consent of the Indemnifying Party, which consent will not be unreasonably
withheld). The Indemnified Party will have full control of such defense and proceedings, including any compromise or settlement thereof;
provided, however, that if requested by the Indemnified Party, the Indemnifying Party will, at the sole cost and expense of the Indemnifying
Party, provide reasonable cooperation to the Indemnified Party and its counsel in contesting any Third Party Claim which the Indemnified
Party is contesting. Notwithstanding the foregoing provisions of this clause (ii), if the Indemnifying Party has notified the Indemnified
Party within the Dispute Period that the Indemnifying Party disputes its liability or the amount of its liability hereunder to the Indemnified
Party with respect to such Third Party Claim and if such dispute is resolved in favor of the Indemnifying Party in the manner provided
in clause (iii) below, the Indemnifying Party will not be required to bear the costs and expenses of the Indemnified Party’s defense
pursuant to this clause (ii) or of the Indemnifying Party’s participation therein at the Indemnified Party’s request, and
the Indemnified Party shall reimburse the Indemnifying Party in full for all reasonable costs and expenses incurred by the Indemnifying
Party in connection with such litigation. The Indemnifying Party may participate in, but not control, any defense or settlement controlled
by the Indemnified Party pursuant to this clause (ii), and the Indemnifying Party shall bear its own costs and expenses with respect to
such participation.

 

 

 

 

    	 	15	 

     

    

 

(iii)                If
the Indemnifying Party notifies the Indemnified Party that it does not dispute its liability or the amount of its liability to the Indemnified
Party with respect to the Third Party Claim under Section 9.2 or fails to notify the Indemnified Party within the Dispute Period whether
the Indemnifying Party disputes its liability or the amount of its liability to the Indemnified Party with respect to such Third Party
Claim, the amount of Damages specified in the Claim Notice shall be conclusively deemed a liability of the Indemnifying Party under Section
9.2 and the Indemnifying Party shall pay the amount of such Damages to the Indemnified Party on demand. If the Indemnifying Party has
timely disputed its liability or the amount of its liability with respect to such claim, the Indemnifying Party and the Indemnified Party
shall proceed in good faith to negotiate a resolution of such dispute; provided, however, that if the dispute is not resolved
within thirty (30) days after the Claim Notice, the Indemnifying Party shall be entitled to institute such legal action as it deems appropriate.

 

(b)                 
In the event any Indemnified Party should have a claim under Section 9.2 against the Indemnifying Party that does not involve a
Third Party Claim, the Indemnified Party shall deliver a written notification of a claim for indemnity under Section 9.2 specifying the
nature of and basis for such claim, together with the amount or, if not then reasonably ascertainable, the estimated amount, determined
in good faith, of such claim (an “Indemnity Notice”) with reasonable promptness to the Indemnifying Party. The failure
by any Indemnified Party to give the Indemnity Notice shall not impair such party’s rights hereunder except to the extent that the
Indemnifying Party demonstrates that it has been irreparably prejudiced thereby. If the Indemnifying Party notifies the Indemnified Party
that it does not dispute the claim or the amount of the claim described in such Indemnity Notice or fails to notify the Indemnified Party
within the Dispute Period whether the Indemnifying Party disputes the claim or the amount of the claim described in such Indemnity Notice,
the amount of Damages specified in the Indemnity Notice will be conclusively deemed a liability of the Indemnifying Party under Section
9.2 and the Indemnifying Party shall pay the amount of such Damages to the Indemnified Party on demand. If the Indemnifying Party has
timely disputed its liability or the amount of its liability with respect to such claim, the Indemnifying Party and the Indemnified Party
shall proceed in good faith to negotiate a resolution of such dispute; provided, however, that if the dispute is not resolved within thirty
(30) days after the Claim Notice, the Indemnifying Party shall be entitled to institute such legal action as it deems appropriate.

 

(c)                   The Indemnifying Party agrees to pay the Indemnified Party, promptly as such expenses are incurred and are due and payable, for
any reasonable legal fees or other reasonable expenses incurred by them in connection with investigating or defending any such Third Party
Claim.

 

(d)                  The indemnity provisions contained herein shall be in addition to (i) any cause of action or similar rights of the Indemnified
Party against the Indemnifying Party or others, and (ii) any liabilities the Indemnifying Party may be subject to.

 

ARTICLE X

MISCELLANEOUS

 

Section 10.1           GOVERNING LAW; JURISDICTION. This Agreement shall be governed by and interpreted in accordance with the laws of the State
of California without regard to the principles of conflicts of law. Each of the Company and the Investor hereby submits to the exclusive
jurisdiction of the United States federal and state courts located in Los Angeles, California, with respect to any dispute arising under
the Transaction Documents or the transactions contemplated thereby.

 

Section 10.2           JURY TRIAL WAIVER. The Company and the Investor hereby waive a trial by jury in any action, proceeding or counterclaim brought
by either of the parties hereto against the other in respect of any matter arising out of or in connection with the Transaction Documents.

 

Section 10.3           ASSIGNMENT. The Transaction Documents shall be binding upon and inure to the benefit of the Company and the Investor and
their respective successors. Neither this Agreement nor any rights of the Investor or the Company hereunder may be assigned by either
party to any other Person.

 

Section 10.4          NO THIRD-PARTY BENEFICIARIES. This Agreement is intended for the benefit of the Company and the Investor and their respective
successors, and is not for the benefit of, nor may any provision hereof be enforced by, any other Person, except as contemplated by Article
IX.

 

 

 

 

    	 	16	 

     

    

 

Section 10.5           TERMINATION. The Company may terminate this Agreement at any time in the event of a material breach of the Agreement by
the Investor, which shall be effected by written notice being sent by the non-breaching party to the breaching party. In addition, this
Agreement shall automatically terminate on the earlier of (i) the end of the Commitment Period or (ii) the date that, pursuant to or within
the meaning of any Bankruptcy Law, the Company commences a voluntary case or any Person commences a proceeding against the Company, a
Custodian is appointed for the Company or for all or substantially all of its property or the Company makes a general assignment for the
benefit of its creditors; provided, however, that the provisions of Articles III, IV, V, VI, IX and the agreements and covenants of the
Company and the Investor set forth in this Article X shall survive the termination of this Agreement.

 

Section 10.6          ENTIRE AGREEMENT. The Transaction Documents, together with the exhibits thereto, contain the entire understanding of the
Company and the Investor with respect to the matters covered herein and therein 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 and exhibits.

 

Section 10.7           FEES AND EXPENSES. Except as expressly set forth in the Transaction Documents or any other writing 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 the
Document Preparation Fee associated with the Closing of the first Purchase Notice, and the Clearing Cost associated with each Closing,
and any Transfer Agent fees.

 

Section 10.8           COUNTERPARTS. The Transaction Documents may be executed in multiple counterparts, each of which may be executed by less
than all of the parties and shall be deemed to be an original instrument which shall be enforceable against the parties actually executing
such counterparts and all of which together shall constitute one and the same instrument. The Transaction Documents may be delivered to
the other parties hereto by email of a copy of the Transaction Documents bearing the signature of the parties so delivering this Agreement.

 

Section 10.9           SEVERABILITY. In the event that any provision of this Agreement becomes or is declared by a court of competent jurisdiction
to be illegal, unenforceable or void, this Agreement shall continue in full force and effect without said provision; provided that such
severability shall be ineffective if it materially changes the economic benefit of this Agreement to any party.

 

Section 10.10         FURTHER ASSURANCES. Each party shall do and perform, or cause to be done and performed, all such further acts and things,
and shall execute and deliver all such other agreements, certificates, instruments and documents, as the other party may reasonably request
in order to carry out the intent and accomplish the purposes of this Agreement and the consummation of the transactions contemplated hereby.

 

Section 10.11         NO STRICT CONSTRUCTION. The language used in this Agreement will be deemed to be the language chosen by the parties to express
their mutual intent, and no rules of strict construction will be applied against any party.

 

Section 10.12         EQUITABLE RELIEF. The Company recognizes that in the event that it fails to perform, observe, or discharge any or all of
its obligations under this Agreement, any remedy at law may prove to be inadequate relief to the Investor. The Company therefore agrees
that the Investor shall be entitled to temporary and permanent injunctive relief in any such case without the necessity of proving actual
damages. In addition to being entitled to exercise all rights provided herein or granted by law, both parties 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.

 

Section 10.13         TITLE AND SUBTITLES. The titles and subtitles used in this Agreement are used for the convenience of reference and are not
to be considered in construing or interpreting this Agreement.

 

Section 10.14         AMENDMENTS; WAIVERS. No provision of this Agreement may be amended or waived by the parties from and after the date that
is one (1) Business Day immediately preceding the initial filing of the prospectus to the Registration Statement with the SEC. Subject
to the immediately preceding sentence, (i) no provision of this Agreement may be amended other than by a written instrument signed by
both parties hereto and (ii) no provision of this Agreement may be waived other than in a written instrument signed by the party against
whom enforcement of such waiver is sought. No failure or delay in the exercise of any power, right or privilege hereunder shall operate
as a waiver thereof, nor shall any single or partial exercise of any such power, right or privilege preclude other or further exercise
thereof or of any other right, power or privilege.

 

 

 

 

    	 	17	 

     

    

 

Section 10.15         PUBLICITY. The Company and the Investor shall consult with each other in issuing any press releases or otherwise making
public statements with respect to the transactions contemplated hereby and no party shall issue any such press release or otherwise make
any such public statement, other than as required by law, without the prior written consent of the other parties, which consent shall
not be unreasonably withheld or delayed, except that no prior consent shall be required if such disclosure is required by law, in which
such case the disclosing party shall provide the other party with prior notice of such public statement. Notwithstanding the foregoing,
the Company shall not publicly disclose the name of the Investor without the prior written consent of the Investor, except to the extent
required by law. The Investor acknowledges that the Transaction Documents may be deemed to be “material contracts,”
as that term is defined by Item 601(b)(10) of Regulation S-K, and that the Company may therefore be required to file such documents as
exhibits to reports or registration statements filed under the Securities Act or the Exchange Act. The Investor further agrees that the
status of such documents and materials as material contracts shall be determined solely by the Company, in consultation with its counsel.

 

Section 10.16         DISPUTE RESOLUTION.

 

(a)                   Submission to Dispute Resolution.

 

(i)                  In the case of a dispute relating to the Average Daily Trading Volume, Purchase Notice Limit or VWAP (as the case may be) (including,
without limitation, a dispute relating to the determination of any of the foregoing), the Company or the Investor (as the case may be)
shall submit the dispute to the other party via facsimile or electronic mail (A) if by the Company, within two (2) Business Days after
the occurrence of the circumstances giving rise to such dispute or (B) if by the Investor at any time after the Investor learned of the
circumstances giving rise to such dispute. If the Investor and the Company are unable to promptly resolve such dispute relating to such
Average Daily Trading Volume, Purchase Notice Limit or VWAP (as the case may be), at any time after the second (2nd) Business Day following
such initial notice by the Company or the Investor (as the case may be) of such dispute to the Company or the Investor (as the case may
be), then the Company and the Investor may select an independent, reputable investment bank as mutually agreed upon to resolve such dispute.

 

(ii)                 The Investor and the Company shall each deliver to such investment bank (A) a copy of the initial dispute submission so delivered
in accordance with the first sentence of this Section 10.16 and (B) written documentation supporting its position with respect to such
dispute, in each case, no later than 5:00 p.m. (New York time) by the fifth (5th) Business Day immediately following the date on which
such investment bank was selected (the “Dispute Submission Deadline”) (the documents referred to in the immediately preceding
clauses (A) and (B) are collectively referred to herein as the “Required Dispute Documentation”) (it being understood and
agreed that if either the Investor or the Company fails to so deliver all of the Required Dispute Documentation by the Dispute Submission
Deadline, then the party who fails to so submit all of the Required Dispute Documentation shall no longer be entitled to (and hereby waives
its right to) deliver or submit any written documentation or other support to such investment bank with respect to such dispute and such
investment bank shall resolve such dispute based solely on the Required Dispute Documentation that was delivered to such investment bank
prior to the Dispute Submission Deadline). Unless otherwise agreed to in writing by both the Company and the Investor or otherwise requested
by such investment bank, neither the Company nor the Investor shall be entitled to deliver or submit any written documentation or other
support to such investment bank in connection with such dispute (other than the Required Dispute Documentation).

 

(iii)                The Company and the Investor shall cause such investment bank to determine the resolution of such dispute and notify the Company
and the Investor of such resolution no later than ten (10) Business Days immediately following the Dispute Submission Deadline. The fees
and expenses of such investment bank shall be borne solely by the party submitting such dispute, and such investment bank’s resolution
of such dispute shall be final and binding upon all parties absent manifest error.

 

(b)                  Miscellaneous. Both the Company and the Investor expressly acknowledge and agree that (i) this Section 10.16 constitutes
an agreement to arbitrate between the Company and the Investor (and constitutes an arbitration agreement) only with respect to such dispute
in connection with Section 10.16(a)(i) and that both the Company and the Investor are authorized to apply for an order to compel arbitration
in order to compel compliance with this Section 10.16, (ii) the terms of this Agreement and each other applicable Transaction Document
shall serve as the basis for the selected investment bank’s resolution of the applicable dispute, such investment bank shall be
entitled (and is hereby expressly authorized) to make all findings, determinations and the like that such investment bank determines are
required to be made by such investment bank in connection with its resolution of such dispute and in resolving such dispute such investment
bank shall apply such findings, determinations and the like to the terms of this Agreement and any other applicable Transaction Documents,
(iii) the Company and the Investor shall have the right to submit any dispute other than described in this Section 10.16 (a) to any state
or federal court sitting in The City of New York and (iv) nothing in this Section 10.16 shall limit the Company or the Investor from obtaining
any injunctive relief or other equitable remedies (including, without limitation, with respect to any matters described in this Section
10.16). The Company and the Investor agree that all dispute resolutions may be conducted in a virtual setting to be mutually agreed by
both parties.

 

 

 

 

    	 	18	 

     

    

 

 

Section 10.17         NOTICES. All notices, demands, requests, consents, approvals, and other communications required or permitted hereunder shall
be in writing and, unless otherwise specified herein, shall be (a) personally served, (b) delivered by reputable air courier service with
charges prepaid next Business Day delivery, or (c) transmitted by hand delivery, or email as a PDF, addressed as set forth below or to
such other address as such party shall have specified most recently by written notice given in accordance herewith. Any notice or other
communication required or permitted to be given hereunder shall be deemed effective upon hand delivery or delivery by email at the address
designated below (if delivered on a business day during normal business hours where such notice is to be received), or the first business
day following such delivery (if delivered other than on a business day during normal business hours where such notice is to be received).

 

The addresses for such communications
shall be:

 

If to the Company:

 

AUDDIA INC.

Email: mlawless@auddia.com

 

with a copy (not constituting notice)
to:

 

Carroll Legal LLC

Email: jcarroll@carroll.legal

 

If to the Investor:

 

WHITE LION CAPITAL LLC

Email: team@whitelioncapital.com

 

With a copy (not constituting notice)
to:

 

Greenberg Traurig, P.A.

333 S.E. 2nd Avenue

Miami, FL 33131

Email: owensjohn@gtlaw.com

Attn: John D. Owens, III, Esq.

 

 

Either party hereto may from time to time change
its address or email for notices under this Section 10.18 by giving prior written notice of such changed address to the other party hereto.

 

[Signature Page
Follows]

 

 

 

 

 

 

    	 	19	 

     

    

 

 

IN WITNESS WHEREOF,
the parties have caused this Agreement to be duly executed by their respective officers thereunto duly authorized as of the Execution
Date.

 

 

	 	Auddia Inc.
	 	 
	 	 
	 	By:/s/ Jeff
Thramann
	 	Name: Jeff Thramann
	 	Title: Executive Chairman
	 	 
	 	 
	 	White Lion Capital LLC
	 	 
	 	 
	 	 
	 	By:/s/ Sam
Yaffa        
	 	Name: Sam Yaffa
	 	Title: Managing Director

 

 

 

 

 

 

 

 

 

 

 

    	 	20	 

     

    

 

DISCLOSURE SCHEDULES TO

COMMON STOCK PURCHASE AGREEMENT

 

 

[Omitted]

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

    	 	21	 

     

    

 

EXHIBIT A

 

FORM OF PURCHASE NOTICE

 

TO: WHITE LION CAPITAL LLC

 

We refer to the Common Stock Purchase
Agreement, dated as of November 14, 2022, (the “Agreement”), entered into by and between Auddia Inc.,
and White Lion Capital LLC. Capitalized terms defined in the Agreement shall, unless otherwise defined herein, have the same meaning when
used herein.

 

We hereby:

 

1) Give you notice that we require you to purchase
__________ Purchase Notice Shares; and

 

2) Certify that, as of the date hereof, the conditions
set forth in Section 7 of the Agreement are satisfied.

 

 

	 	Auddia Inc.
	 	 
	 	 
	 	 
	 	By: _____________________
	 	Name: Michael Lawless
	 	Title:Chief Executive
Officer

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

    	 	22

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