Document:

SECURITIES PURCHASE AGREEMENT

 

This Securities Purchase
Agreement (this “Agreement”) is dated as of February [  ], 2014, between Cytosorbents Corporation, a Nevada corporation
(the “Company”) and each purchaser identified on the signature pages hereto (each, including its successors
and assigns, a “Purchaser” and collectively the “Purchasers”).

 

WHEREAS, subject to
the terms and conditions set forth in this Agreement and pursuant to an effective registration statement under the Securities Act
of 1933, as amended (the “Securities Act”), the Company desires to issue and sell to each Purchaser, and each
Purchaser, severally and not jointly, desires to purchase from the Company, securities of the Company as more fully described in
this Agreement.

 

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

 

ARTICLE I.

DEFINITIONS

 

1.1            Definitions.  In
addition to the terms defined elsewhere in this Agreement, for all purposes of this Agreement, the following terms have the meanings
set forth in this Section 1.1:

 

“Acquiring
Person” shall have the meaning ascribed to such term in Section 4.5.

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

“Common Stock”
means the common stock of the Company, par value $0.001 per share, and any other class of securities into which such securities
may hereafter be reclassified or changed.

 

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

 

“Company Counsel”
means Szaferman Lakind Blumstein & Blader, PC, with offices located at 101 Grovers Mill Road, #200, Lawrenceville, New Jersey
08648.

 

    	 

    	 

    

 

“Greenberg”
means Greenberg Traurig, with offices located at One International Place, Boston, Massachusetts 02110.

 

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

 

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

 

“Exempt Issuance”
means the issuance of (a) shares of Common Stock or options to employees, officers or directors of the Company pursuant to any
stock or option plan duly adopted for such purpose, by a majority of the non-employee members of the Board of Directors or a majority
of the members of a committee of non-employee directors established for such purpose, (b) securities upon the exercise or exchange
of or conversion of any Securities issued hereunder and/or other securities exercisable or exchangeable for or convertible into
shares of Common Stock issued and outstanding on the date of this Agreement, provided that such securities have not been amended
since the date of this Agreement to increase the number of such securities or to decrease the exercise price, exchange price or
conversion price of such securities, and (c) securities issued pursuant to acquisitions or strategic transactions approved by a
majority of the disinterested directors of the Company, provided that any such issuance shall only be to a Person (or to the equityholders
of a Person) which is, itself or through its subsidiaries, an operating company or an owner of an asset in a business synergistic
with the business of the Company and shall provide to the Company additional benefits in addition to the investment of funds, but
shall not include a transaction in which the Company is issuing securities primarily for the purpose of raising capital or to an
entity whose primary business is investing in securities.

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

“Per Share
Purchase Price” equals $______, subject to adjustment for reverse and forward stock splits, stock dividends, stock combinations
and other similar transactions of the Common Stock that occur after the date of this Agreement.

 

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

 

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

 

“Prospectus”
means the final prospectus filed for the Registration Statement.

 

“Prospectus
Supplement” means the supplement to the Prospectus complying with Rule 430A of the Securities Act that is filed with
the Commission and delivered by the Company to each Purchaser at the Closing.

 

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

 

    	 

    	 

    

 

“Registration
Statement” means the effective registration statement with Commission file No. 333-193053 which registers the sale of
the Shares, the Warrants and the Warrant Shares to the Purchasers.

  

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

 

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

 

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

 

“Rule 430A”
means Rule 430A promulgated by the Commission pursuant to the Securities Act, as such Rule may be amended or interpreted from time
to time, or any similar rule or regulation hereafter adopted by the Commission having substantially the same purpose and effect
as such Rule.

 

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

 

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

 

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

 

“Shares”
means the shares of Common Stock issued or issuable to each Purchaser pursuant to this Agreement.

 

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

 

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

 

“Subsidiary”
means any subsidiary of the Company, and shall, where applicable, also include any direct or indirect subsidiary of the Company
formed or acquired after the date hereof.

 

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

 

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

 

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

 

“Transfer
Agent” means American Stock Transfer & Trust Company, LLC, with a corporate address of 6201 15th Avenue,
Brooklyn, New York 11219 and any successor transfer agent of the Company.

 

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

 

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

 

    	 

    	 

    

 

ARTICLE II.

PURCHASE AND SALE

 

2.1        
 Closing.  On the Closing Date, upon the terms and subject to the conditions set forth herein, substantially
concurrent with the execution and delivery of this Agreement by the parties hereto, the Company agrees to sell, and the Purchasers,
severally and not jointly,  agree to purchase, up to an aggregate of $8,500,000 of Shares and Warrants.  Each
Purchaser shall deliver to the Company, via wire transfer or a certified check, immediately available funds equal to such Purchaser’s
Subscription Amount as set forth on the signature page hereto executed by such Purchaser and the Company shall deliver to each
Purchaser its respective Shares and a Warrant as determined pursuant to Section 2.2(a), and the Company and each Purchaser shall
deliver the other items set forth in Section 2.2 deliverable at the Closing.  Upon satisfaction of the covenants and
conditions set forth in Sections 2.2 and 2.3, the Closing shall occur at the offices of Company Counsel or such other location
as the parties shall mutually agree.

 

2.2        
 Deliveries.

 

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

 

(i)   this Agreement duly executed by the Company;

 

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

  

(iii)   a copy of the irrevocable
instructions to the Transfer Agent instructing the Transfer Agent to deliver on an expedited basis via The Depository Trust Company
Deposit or Withdrawal at Custodian system (“DWAC”) Shares equal to such Purchaser’s Subscription Amount
divided by the Per Share Purchase Price, registered in the name of such Purchaser;

 

(iv)   a Warrant registered
in the name of such Purchaser to purchase up to a number of shares of Common Stock equal to 50% of such Purchaser’s Shares,
with an exercise price equal to $_____, subject to adjustment therein (such Warrant certificate may be delivered within three
Trading Days of the Closing Date); and

 

(v)   the Prospectus and Prospectus
Supplement (which may be delivered in accordance with Rule 172 under the Securities Act).

 

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

 

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

 

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

 

2.3        
 Closing
Conditions.

 

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

 

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

 

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

 

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

 

    	 

    	 

    

 

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

 

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

 

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

 

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

 

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

 

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

 

ARTICLE III.

REPRESENTATIONS AND WARRANTIES

 

3.1        
 Representations
and Warranties of the Company.  Except as set forth in the Prospectus, Prospectus Supplement or SEC Reports, which
Prospectus, Prospectus Supplement or SEC Reports shall be deemed a part hereof and shall qualify any representation or otherwise
made herein, the Company hereby makes the following representations and warranties to each Purchaser:

 

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

 

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

 

    	 

    	 

    

 

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

 

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

 

(e)       
Filings, Consents and Approvals.  The Company is not required to obtain any consent, waiver, authorization or
order of, give any notice to, or make any filing or registration with, any court or other federal, state, local or other governmental
authority or other Person in connection with the execution, delivery and performance by the Company of the Transaction Documents,
other than: (i) the filings required pursuant to Section 4.4 of this Agreement, (ii) the filing with the Commission of the Prospectus
Supplement, (iii) application(s) to each applicable Trading Market for the listing of the Shares and Warrant Shares for trading
thereon in the time and manner required thereby and (iv) such filings as are required to be made under applicable state securities
laws (collectively, the “Required Approvals”).

 

(f)         
Issuance of the Securities; Registration.  The Securities are duly authorized and, when issued and paid for in
accordance with the applicable Transaction Documents, will be duly and validly issued, fully paid and nonassessable, free and clear
of all Liens imposed by the Company.  The Warrant Shares, when issued in accordance with the terms of the Warrants, will
be validly issued, fully paid and nonassessable, free and clear of all Liens imposed by the Company.  The Company has
reserved from its duly authorized capital stock the maximum number of shares of Common Stock issuable pursuant to this Agreement
and the Warrants. The Company has prepared and filed the Registration Statement in conformity with the requirements of the Securities
Act, which became effective on February [ ], 2014 (the “Effective Date”), including the Prospectus, and such
amendments and supplements thereto as may have been required to the date of this Agreement.  The Registration Statement
is effective under the Securities Act and no stop order preventing or suspending the effectiveness of the Registration Statement
or suspending or preventing the use of the Prospectus has been issued by the Commission and no proceedings for that purpose have
been instituted or, to the knowledge of the Company, are threatened by the Commission.  The Company, if required by the
rules and regulations of the Commission, proposes to file the Prospectus, with the Commission pursuant to Rule 424(b) or Rule 430A.  At
the time the Registration Statement and any amendments thereto became effective, at the date of this Agreement and at the Closing
Date, the Registration Statement and any amendments thereto conformed and will conform in all material respects to the requirements
of the Securities Act and did not and will not contain any untrue statement of a material fact or omit to state any material fact
required to be stated therein or necessary to make the statements therein not misleading; and the Prospectus and any amendments
or supplements thereto, at time the Prospectus or any amendment or supplement thereto was issued and at the Closing Date, conformed
and will conform in all material respects to the requirements of the Securities Act and did not and will not contain an untrue
statement of a material fact or omit to state a material fact necessary in order to make the statements therein, in light of the
circumstances under which they were made, not misleading.

 

    	 

    	 

    

 

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

 

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

 

    	 

    	 

    

 

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

 

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

 

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

 

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

 

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

 

    	 

    	 

    

 

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

 

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

 

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

 

(q)       
Transactions With Affiliates and Employees.  Except as set forth in the SEC Reports, none of the officers or directors
of the Company or any Subsidiary and, to the knowledge of the Company, none of the employees of the Company or any Subsidiary is
presently a party to any transaction with the Company or any Subsidiary (other than for services as employees, officers and directors),
including any contract, agreement or other arrangement providing for the furnishing of services to or by, providing for rental
of real or personal property to or from, providing for the borrowing of money from or lending of money to or otherwise requiring
payments to or from any officer, director or such employee or, to the knowledge of the Company, any entity in which any officer,
director, or any such employee has a substantial interest or is an officer, director, trustee, stockholder, member or partner,
in each case in excess of $120,000 other than for (i) payment of salary or consulting fees for services rendered, (ii) reimbursement
for expenses incurred on behalf of the Company and (iii) other employee benefits, including stock option agreements under any stock
option plan of the Company.

 

    	 

    	 

    

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

    	 

    	 

    

 

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

 

(z)        
Solvency.  Based on the consolidated financial condition of the Company as of the Closing Date, after giving effect
to the receipt by the Company of the proceeds from the sale of the Securities hereunder, (i) the fair saleable value of the Company’s
assets exceeds the amount that will be required to be paid on or in respect of the Company’s existing debts and other liabilities
(including known contingent liabilities) as they mature, (ii) the Company’s assets do not constitute unreasonably small capital
to carry on its business as now conducted and as proposed to be conducted including its capital needs taking into account the particular
capital requirements of the business conducted by the Company, consolidated and projected capital requirements and capital availability
thereof, and (iii) the current cash flow of the Company, together with the proceeds the Company would receive, were it to liquidate
all of its assets, after taking into account all anticipated uses of the cash, would be sufficient to pay all amounts on or in
respect of its liabilities when such amounts are required to be paid.  The Company does not intend to incur debts beyond
its ability to pay such debts as they mature (taking into account the timing and amounts of cash to be payable on or in respect
of its debt).  The Company has no knowledge of any facts or circumstances which lead it to believe that it will file
for reorganization or liquidation under the bankruptcy or reorganization laws of any jurisdiction within one year from the Closing
Date.  The SEC Reports sets forth as of the date hereof all outstanding secured and unsecured Indebtedness of the Company
or any Subsidiary, or for which the Company or any Subsidiary has commitments.  For the purposes of this Agreement, “Indebtedness”
means (x) any liabilities for borrowed money or amounts owed in excess of $50,000 (other than trade accounts payable incurred in
the ordinary course of business), (y) all guaranties, endorsements and other contingent obligations in respect of indebtedness
of others, whether or not the same are or should be reflected in the Company’s consolidated balance sheet (or the notes thereto),
except guaranties by endorsement of negotiable instruments for deposit or collection or similar transactions in the ordinary course
of business; and (z) the present value of any lease payments in excess of $50,000 due under leases required to be capitalized in
accordance with GAAP.  Neither the Company nor any Subsidiary is in default with respect to any Indebtedness.

 

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

 

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

 

    	 

    	 

    

 

(cc)         Accountants.  The Company’s accounting firm is set forth in the SEC Reports.  To the knowledge and belief
of the Company, such accounting firm (i) is a registered public accounting firm as required by the Exchange Act and (ii) shall
express its opinion with respect to the financial statements to be included in the Company’s Annual Report for the fiscal
years ending December 31, 2013 and December 31, 2014.

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

    	 

    	 

    

 

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

 

(b)       
Understandings or Arrangements.  Such Purchaser is acquiring the Securities as principal for its own account and
has no direct or indirect arrangement or understandings with any other persons to distribute or regarding the distribution of such
Securities (this representation and warranty not limiting such Purchaser’s right to sell the Securities pursuant to the Registration
Statement or otherwise in compliance with applicable federal and state securities laws).  Such Purchaser is acquiring
the Securities hereunder in the ordinary course of its business.

 

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

 

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

 

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

 

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

 

    	 

    	 

    

 

ARTICLE IV.

OTHER AGREEMENTS OF THE PARTIES

 

4.1        
Warrant
Shares.  If all or any portion of a Warrant is exercised at a time when there is an effective registration statement
to cover the issuance or resale of the Warrant Shares or if the Warrant is exercised via cashless exercise and Rule 144 is available,
the Warrant Shares issued pursuant to any such exercise shall be issued free of all legends.  If at any time following
the date hereof the Registration Statement (or any subsequent registration statement registering the sale or resale of the Warrant
Shares) is not effective or is not otherwise available for the sale or resale of the Warrant Shares, the Company shall immediately
notify the holders of the Warrants in writing that such registration statement is not then effective and thereafter shall promptly
notify such holders when the registration statement is effective again and available for the sale or resale of the Warrant Shares
(it being understood and agreed that the foregoing shall not limit the ability of the Company to issue, or any Purchaser to sell,
any of the Warrant Shares in compliance with applicable federal and state securities laws).  The Company shall use best
efforts to keep a registration statement (including the Registration Statement) registering the issuance or resale of the Warrant
Shares effective during the term of the Warrants.

 

4.2        
 Furnishing
of Information.  Until the earliest of the time that (i) no Purchaser owns Securities or (ii) the Warrants have expired,
the Company covenants to timely file (or obtain extensions in respect thereof and file within the applicable grace period) all
reports required to be filed by the Company after the date hereof pursuant to the Exchange Act even if the Company is not then
subject to the reporting requirements of the Exchange Act.

 

4.3         
Integration.  The
Company shall not sell, offer for sale or solicit offers to buy or otherwise negotiate in respect of any security (as defined in
Section 2 of the Securities Act) that would be integrated with the offer or sale of the Securities for purposes of the rules and
regulations of any Trading Market such that it would require shareholder approval prior to the closing of such other transaction
unless shareholder approval is obtained before the closing of such subsequent transaction.

 

4.4         
Securities
Laws Disclosure; Publicity.  The Company shall (a) by 9:30 a.m. (New York City time) on the Trading Day immediately
following the date hereof, issue a press release disclosing the material terms of the transactions contemplated hereby, and (b)
file a Current Report on Form 8-K, including the Transaction Documents as exhibits thereto, with the Commission within the time
required by the Exchange Act.  From and after the issuance of such press release, the Company represents to the Purchasers
that it shall have publicly disclosed all material, non-public information delivered to any of the Purchasers by the Company or
any of its Subsidiaries, or any of their respective officers, directors, employees or agents in connection with the transactions
contemplated by the Transaction Documents.  The Company and each Purchaser shall consult with each other in issuing any
other press releases with respect to the transactions contemplated hereby, and neither the Company nor any Purchaser shall issue
any such press release nor otherwise make any such public statement without the prior consent of the Company, with respect to any
press release of any Purchaser, or without the prior consent of each Purchaser, with respect to any press release of the Company,
which consent shall not unreasonably be withheld or delayed, except if such disclosure is required by law, in which case the disclosing
party shall promptly provide the other party with prior notice of such public statement or communication.  Notwithstanding
the foregoing, the Company shall not publicly disclose the name of any Purchaser, or include the name of any Purchaser in any filing
with the Commission or any regulatory agency or Trading Market, without the prior written consent of such Purchaser, except (a)
as required by federal securities law in connection with the filing of final Transaction Documents with the Commission and (b)
to the extent such disclosure is required by law or Trading Market regulations, in which case the Company shall provide the Purchasers
with prior notice of such disclosure permitted under this clause (b).

 

4.5         
Shareholder
Rights Plan.  No claim will be made or enforced by the Company or, with the consent of the Company, any other Person,
that any Purchaser is an “Acquiring Person” under any control share acquisition, business combination, poison pill
(including any distribution under a rights agreement) or similar anti-takeover plan or arrangement in effect or hereafter adopted
by the Company, or that any Purchaser could be deemed to trigger the provisions of any such plan or arrangement, by virtue of receiving
Securities under the Transaction Documents or under any other agreement between the Company and the Purchasers.

  

4.6        
 Non-Public
Information.  Except with respect to the material terms and conditions of the transactions contemplated by the Transaction
Documents, the Company covenants and agrees that neither it, nor any other Person acting on its behalf will provide any Purchaser
or its agents or counsel with any information that the Company believes constitutes material non-public information, unless prior
thereto such Purchaser shall have entered into a written agreement with the Company regarding the confidentiality and use of such
information.  The Company understands and confirms that each Purchaser shall be relying on the foregoing covenant in
effecting transactions in securities of the Company.

 

    	 

    	 

    

 

4.7        
Use
of Proceeds.  The Company shall use the net proceeds from the sale of the Securities hereunder as set forth in the
Prospectus Supplement.

 

4.8         
Indemnification
of Purchasers.   Subject to the provisions of this Section 4.8, the Company will indemnify and hold each Purchaser
and its directors, officers, shareholders, members, partners, employees and agents (and any other Persons with a functionally
equivalent role of a Person holding such titles notwithstanding a lack of such title or any other title), each Person who controls
such Purchaser (within the meaning of Section 15 of the Securities Act and Section 20 of the Exchange Act), and the directors,
officers, shareholders, agents, members, partners or employees (and any other Persons with a functionally equivalent role of a
Person holding such titles notwithstanding a lack of such title or any other title) of such controlling persons (each, a “Purchaser
Party”) harmless from any and all losses, liabilities, obligations, claims, contingencies, damages, costs and expenses,
including all judgments, amounts paid in settlements, court costs and reasonable attorneys’ fees and costs of investigation
that any such Purchaser Party may suffer or incur as a result of or relating to (a) any breach of any of the representations,
warranties, covenants or agreements made by the Company in this Agreement or in the other Transaction Documents or (b) any action
instituted against the Purchaser Parties in any capacity, or any of them or their respective Affiliates, by any stockholder of
the Company who is not an Affiliate of such Purchaser Party, with respect to any of the transactions contemplated by the Transaction
Documents (unless such action is based upon a breach of such Purchaser Party’s representations, warranties or covenants
under the Transaction Documents or any agreements or understandings such Purchaser Party may have with any such stockholder or
any violations by such Purchaser Party of state or federal securities laws or any conduct by such Purchaser Party which constitutes
fraud, gross negligence, willful misconduct or malfeasance).  If any action shall be brought against any Purchaser Party
in respect of which indemnity may be sought pursuant to this Agreement, such Purchaser Party shall promptly notify the Company
in writing, and the Company shall have the right to assume the defense thereof with counsel of its own choosing reasonably acceptable
to the Purchaser Party.  Any Purchaser Party shall have the right to employ separate counsel in any such action and
participate in the defense thereof, but the fees and expenses of such counsel shall be at the expense of such Purchaser Party
except to the extent that (i) the employment thereof has been specifically authorized by the Company in writing, (ii) the Company
has failed after a reasonable period of time to assume such defense and to employ counsel or (iii) in such action there is, in
the reasonable opinion of counsel, a material conflict on any material issue between the position of the Company and the position
of such Purchaser Party, in which case the Company shall be responsible for the reasonable fees and expenses of no more than one
such separate counsel.  The Company will not be liable to any Purchaser Party under this Agreement (y) for any settlement
by a Purchaser Party effected without the Company’s prior written consent, which shall not be unreasonably withheld or delayed;
or (z) to the extent, but only to the extent that a loss, claim, damage or liability is attributable to any Purchaser Party’s
breach of any of the representations, warranties, covenants or agreements made by such Purchaser Party in this Agreement or in
the other Transaction Documents. The indemnification required by this Section 4.8 shall be made by periodic payments of the amount
thereof during the course of the investigation or defense, as and when bills are received or are incurred. The indemnity agreements
contained herein shall be in addition to any cause of action or similar right of any Purchaser Party against the Company or others
and any liabilities the Company may be subject to pursuant to law.

 

4.9           
Reservation of Common Stock. As of the date hereof, the Company has reserved and the Company shall continue to reserve and
keep available at all times, free of preemptive rights, a sufficient number of shares of Common Stock for the purpose of enabling
the Company to issue Shares pursuant to this Agreement and Warrant Shares pursuant to any exercise of the Warrants.

 

4.10         
Listing of Common Stock. The Company hereby agrees to use best efforts to maintain the listing or quotation of the Common
Stock on the Trading Market on which it is currently listed, and concurrently with the Closing, the Company shall apply to list
or quote all of the Shares and Warrant Shares on such Trading Market and promptly secure the listing of all of the Shares and Warrant
Shares on such Trading Market. The Company further agrees, if the Company applies to have the Common Stock traded on any other
Trading Market, it will then include in such application all of the Shares and Warrant Shares, and will take such other action
as is necessary to cause all of the Shares and Warrant Shares to be listed or quoted on such other Trading Market as promptly as
possible.  The Company will then take all action reasonably necessary to continue the listing and trading of its Common
Stock on a Trading Market and will comply in all respects with the Company’s reporting, filing and other obligations under
the bylaws or rules of the Trading Market.

 

    	 

    	 

    

 

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

 

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

 

ARTICLE V.

MISCELLANEOUS

 

5.1          
Termination.  This Agreement may be terminated by any Purchaser, as to such Purchaser’s obligations hereunder
only and without any effect whatsoever on the obligations between the Company and the other Purchasers, by written notice to the
other parties, if the Closing has not been consummated on or before March 6, 2014; provided, however, that no such
termination will affect the right of any party to sue for any breach by any other party (or parties).

 

5.2          
Fees and Expenses.  Except as expressly set forth in the Transaction Documents to the contrary, each party shall
pay the fees and expenses of its advisers, counsel, accountants and other experts, if any, and all other expenses incurred by such
party incident to the negotiation, preparation, execution, delivery and performance of this Agreement.  The Company shall
pay all Transfer Agent fees (including, without limitation, any fees required for same-day processing of any instruction letter
delivered by the Company and any exercise notice delivered by a Purchaser), stamp taxes and other taxes and duties levied in connection
with the delivery of any Securities to the Purchasers.

 

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

 

    	 

    	 

    

 

5.4          
Notices.  Any and all notices or other communications or deliveries required or permitted to be provided hereunder
shall be in writing and shall be deemed given and effective on the earliest of: (a) the date of transmission, if such notice or
communication is delivered via facsimile at the facsimile number set forth on the signature pages attached hereto at or prior to
5:30 p.m. (New York City time) on a Trading Day, (b) the next Trading Day after the date of transmission, if such notice or communication
is delivered via facsimile at the facsimile number set forth on the signature pages attached hereto on a day that is not a Trading
Day or later than 5:30 p.m. (New York City time) on any Trading Day, (c) the second (2nd)
Trading Day following the date of mailing, if sent by U.S. nationally recognized overnight courier service or (d) upon actual receipt
by the party to whom such notice is required to be given.  The address for such notices and communications shall be as
set forth on the signature pages attached hereto.

  

5.5          
Amendments; Waivers.  No provision of this Agreement may be waived, modified, supplemented or amended except in
a written instrument signed, in the case of an amendment, by the Company and the Purchasers holding at least 51% in interest of
the Shares based on the initial Subscription Amounts hereunder or, in the case of a waiver, by the party against whom enforcement
of any such waived provision is sought.  No waiver of any default with respect to any provision, condition or requirement
of this Agreement shall be deemed to be a continuing waiver in the future or a waiver of any subsequent default or a waiver of
any other provision, condition or requirement hereof, nor shall any delay or omission of any party to exercise any right hereunder
in any manner impair the exercise of any such right.

 

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

 

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

 

5.8          
No Third-Party Beneficiaries.  This Agreement is intended for the benefit of the parties hereto and their respective
successors and permitted assigns and is not for the benefit of, nor may any provision hereof be enforced by, any other Person,
except as otherwise set forth in Section 4.8.

 

5.9           Governing
Law.  All questions concerning the construction, validity, enforcement and interpretation of the Transaction Documents
shall be governed by and construed and enforced in accordance with the internal laws of the State of New York, without regard to
the principles of conflicts of law thereof.  Each party agrees that all legal proceedings concerning the interpretations,
enforcement and defense of the transactions contemplated by this Agreement and any other Transaction Documents (whether brought
against a party hereto or its respective affiliates, directors, officers, shareholders, partners, members, employees or agents)
shall be commenced exclusively in the state and federal courts sitting in the City of New York. Each party hereby irrevocably submits
to the exclusive jurisdiction of the state and federal courts sitting in the City of New York, Borough of Manhattan for the adjudication
of any dispute hereunder or in connection herewith or with any transaction contemplated hereby or discussed herein (including with
respect to the enforcement of any of the Transaction Documents), and hereby irrevocably waives, and agrees not to assert in any
suit, action or proceeding, any claim that it is not personally subject to the jurisdiction of any such court, that such suit,
action or proceeding is improper or is an inconvenient venue for such proceeding.  Each party hereby irrevocably waives
personal service of process and consents to process being served in any such suit, action or proceeding by mailing a copy thereof
via registered or certified mail or overnight delivery (with evidence of delivery) to such party at the address in effect for notices
to it under this Agreement and agrees that such service shall constitute good and sufficient service of process and notice thereof.  Nothing
contained herein shall be deemed to limit in any way any right to serve process in any other manner permitted by law.  If
either party shall commence an action, suit or proceeding to enforce any provisions of the Transaction Documents, then, in addition
to the obligations of the Company under Section 4.8, the prevailing party in such action, suit or proceeding shall be reimbursed
by the other party for its reasonable attorneys’ fees and other costs and expenses incurred with the investigation, preparation
and prosecution of such action or proceeding.

 

    	 

    	 

    

  

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

 

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

 

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

 

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

 

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

  

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

 

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

 

    	 

    	 

    

 

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

  

5.18        
Liquidated Damages.  The Company’s obligations to pay any partial liquidated damages or other amounts owing
under the Transaction Documents is a continuing obligation of the Company and shall not terminate until all unpaid partial liquidated
damages and other amounts have been paid notwithstanding the fact that the instrument or security pursuant to which such partial
liquidated damages or other amounts are due and payable shall have been canceled.

 

5.19        
Saturdays, Sundays, Holidays, etc.  If the last or appointed day for the taking of any action or the expiration
of any right required or granted herein shall not be a Business Day, then such action may be taken or such right may be exercised
on the next succeeding Business Day.

 

5.20        
Construction. The parties agree that each of them and/or their respective counsel have reviewed and had an opportunity to
revise the Transaction Documents and, therefore, the normal rule of construction to the effect that any ambiguities are to be resolved
against the drafting party shall not be employed in the interpretation of the Transaction Documents or any amendments thereto.
In addition, each and every reference to share prices and shares of Common Stock in any Transaction Document shall be subject to
adjustment for reverse and forward stock splits, stock dividends, stock combinations and other similar transactions of the Common
Stock that occur after the date of this Agreement.

 

5.21       
WAIVER OF JURY TRIAL.  IN ANY ACTION, SUIT, OR PROCEEDING IN ANY JURISDICTION BROUGHT BY ANY PARTY AGAINST
ANY OTHER PARTY, THE PARTIES EACH KNOWINGLY AND INTENTIONALLY, TO THE GREATEST EXTENT PERMITTED BY APPLICABLE LAW, HEREBY ABSOLUTELY,
UNCONDITIONALLY, IRREVOCABLY AND EXPRESSLY WAIVES FOREVER TRIAL BY JURY.

 

(Signature Pages Follow)

 

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

 

    	 

    	 

    

 

	CYTOSORBENTS CORPORATION	Address for Notice:
	 	7 Deer Park Drive. Suite K
	 	Monmouth Junction, New Jersey 08852
	 	 
	 	 
	By:	 	
	Name:	 
	Title:	 
	 	 
	With a copy to (which shall not constitute notice):	 

 

Gregg E. Jaclin, Esq.

Szaferman, Lakind, Blumstein & Blader, PC

101 Grovers Mill Road, Suite 200

Lawrenceville, New Jersey 08648

Tel. No.: (609) 275-0400

Fax No.: (609) 275-4511

 

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK

SIGNATURE PAGE FOR PURCHASER FOLLOWS]

 

    	 

    	 

    

 

 

[PURCHASER SIGNATURE PAGES TO CTSO SECURITIES
PURCHASE AGREEMENT]

 

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

 

Name of Purchaser: ________________________________________________________

Signature of Authorized Signatory of Purchaser: _________________________________

Name of Authorized Signatory: _______________________________________________

Title of Authorized Signatory: ________________________________________________

Email Address of Authorized Signatory:_________________________________________

Facsimile Number of Authorized Signatory: ______________________________________

Address for Notice to Purchaser:

 

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

 

Subscription Amount: $_________________

 

Shares: _________________

 

Warrant Shares: __________________

 

EIN Number: _______________________

 

o  Notwithstanding
anything contained in this Agreement to the contrary, by checking this box (i) the obligations of the above-signed to purchase
the securities set forth in this Agreement to be purchased from the Company by the above-signed, and the obligations of the Company
to sell such securities to the above-signed, shall be unconditional and all conditions to Closing shall be disregarded, (ii) the
Closing shall occur on the third (3rd) Trading Day following the date of this Agreement and
(iii) any condition to Closing contemplated by this Agreement (but prior to being disregarded by clause (i) above) that required
delivery by the Company or the above-signed of any agreement, instrument, certificate or the like or purchase price (as applicable)
shall no longer be a condition and shall instead be an unconditional obligation of the Company or the above-signed (as applicable)
to deliver such agreement, instrument, certificate or the like or purchase price (as applicable) to such other party on the Closing
Date.

 

[SIGNATURE PAGES CONTINUE]EMPLOYMENT AGREEMENT

 

THIS EMPLOYMENT
AGREEMENT (the “Agreement”), entered into February 4, 2014, and effective as of the 1st day of January, 2014 (the
“Effective Date”), by and between First Financial Bank, N.A. (the “Bank”), a national banking association
organized under the laws of the United States of America, First Financial Corporation (the “Corporation”), a corporation
formed under the laws of the State of Indiana and a financial holding company (jointly referred to herein as the “Company”)
and Norman L. Lowery (the “Employee”), a resident of the State of Indiana.

 

WHEREAS, the
Employee has heretofore been employed by the Bank as its President and Chief Executive Officer and by the Corporation as its Chief
Executive Officer and has performed valuable services for both the Bank and the Corporation; and

 

WHEREAS, the
Company desires to enter into this Agreement with the Employee in order to assure continuity of management and to reinforce and
encourage the continued attention and dedication of the Employee to his assigned duties; and

 

WHEREAS, the
parties desire, by this writing, to set forth the continuing employment relationship between the Company and the Employee.

 

NOW, THEREFORE,
in consideration of the premises contained herein and for other good and valuable consideration, the receipt and adequacy of which
are hereby acknowledged, the Employee and the Company agree as follows:

 

1.          Employment.
The Employee is employed as the President and Chief Executive Officer of the Bank and as the President and Chief Executive Officer
of the Corporation. The Employee shall render such administrative and management services for the Company as are currently rendered
and as are currently performed by persons situated in a similar executive capacity. The Employee shall also promote, by entertainment
or otherwise, as and to the extent permitted by law, the business of the Company. The Employee’s other duties shall be such
as the boards of directors of the Bank or the Corporation may, from time to time, reasonably direct, including normal duties as
an officer of the Bank and the Corporation. During the term of this Agreement, the Employee shall be nominated and elected to serve
as a director of the Bank or of any successor to the Bank and shall be nominated to serve as a director of the Corporation.

 

2.          Base
Compensation. The Company agrees to pay the Employee during the term of this Agreement a base salary at the rate of $630,297
per annum, payable in cash not less frequently than monthly. Such base salary shall be effective and calculated commencing as of
the Effective Date. The Company may consider and declare from time to time increases in the base salary it pays the Employee. Prior
to a Change in Control (as hereinafter defined), the Company may also declare decreases in the base salary it pays the Employee
if the operating results of the Company are significantly less favorable than those for the fiscal year ending December 31, 2009,
and the Company makes similar decreases in the base salary it pays to other executive officers of the Company. After a Change in
Control, the Company shall consider and declare salary increases in base salary based upon the following standards:

 

    	 

    	 

    

 

(a)          Inflation;

 

(b)          Adjustments
to the base salaries of other senior management personnel;

 

(c)          Past
performance of the Employee; and

 

(d)          The
contribution which the Employee makes to the business and profits of the Company during the term of this Agreement.

 

3.          Bonuses.
The Employee shall participate in any year-end bonus granted to other employees. The Employee shall further participate in an equitable
manner with all other senior management employees of the Company in any discretionary bonuses that the Company may award from time
to time to senior management employees. No other compensation provided for in this Agreement shall be deemed a substitute for the
Employee’s right to participate in such discretionary bonuses.

 

4.          Benefits.

 

(a)          Participation
in Retirement, Medical and Other Benefit Plans. During the term of this Agreement, the Employee shall be eligible to participate
in the following benefit plans; group hospitalization, disability, health, dental, sick leave, retirement, supplemental retirement,
pension, 401(k), employee stock ownership plan, and all other present or future qualified and/or nonqualified plans provided by
the Company generally, or to executive officers of the Bank or the Corporation, which benefits, taken as a whole, must be at least
as favorable as those in effect on the Effective Date, unless the continued operation of such plans or changes in the accounting,
legal or tax treatment of such plans would adversely affect the Company’s operating results or financial condition in a material
way, and the Company concludes that modifications to such plans are necessary to avoid such adverse effects and such modifications
apply consistently to all employees participating in the affected plans. In addition, the Employee shall be eligible to participate
in any fringe benefits which are or may become available to the Company’s senior management employees, including, for example,
any cash or equity incentive, bonus or long-term compensation plan, any insurance programs (including, but not limited to, any
group and executive life insurance programs), and any other benefits which are commensurate with the responsibilities and functions
to be performed by the Employee under this Agreement. All the employee benefits referenced in this subsection 4(a) are collectively
referred to hereinafter as “Employee Benefits.”

 

    	2

    	 

    

 

(b)          Benefits
After Retirement. Upon retirement of the Employee at or after attaining age 65 (“Retirement Age”), during the term
of this Agreement, the Company agrees to continue, at no greater cost to Employee than is generally allocated to all employees,
full coverage for the Employee, his spouse and his children living in his household under the health, life and disability plans
as adopted by the Company which shall be no less favorable than those in effect on the Effective Date of this Agreement. The Company
agrees to continue such health coverage until both the Employee and his spouse are eligible for coverage by Medicare. When both
the Employee and his spouse become eligible for Medicare coverage, the Company agrees to pay for supplemental coverage, at the
best level available which includes prescription drug coverage, for both the Employee and his spouse until the death of the Employee
and his spouse. The Employee shall be entitled to a life insurance policy on his life, provided at the Company’s cost, in
the maximum amount established by the Company’s group life insurance plan from time to time which amount shall be no less
than the limit on the Effective Date of three times his annual salary (subject to a $350,000 maximum). The Employee shall also
be entitled to an additional life insurance policy on his life in the amount established by the Company’s insurance program
for executive officers from time to time. The Company shall continue to pay to the Employee the annual premiums, which are required
to keep the life insurance policy in force, on behalf of the Employee pursuant to the Company’s insurance program for executive
officers.

 

(c)          Expenses
and Membership. The Employee shall be reimbursed for all reasonable out-of-pocket business expenses which he shall incur in
connection with his services under this Agreement, upon substantiation of such expenses in accordance with the policies of the
Company. In addition, the Employee shall be reimbursed for all reasonable out-of-pocket expenses incurred by him to satisfy his
continuing legal education requirements for his license to practice law in the State of Indiana. So long as the Employee is employed
by the Company pursuant to this Agreement, the Employee shall be entitled to continue his memberships in the American, Indiana
and Terre Haute Bar Associations, the American Association for Justice, the Indiana Trial Lawyers Association and the Country Club
of Terre Haute, and the Company shall continue to pay or reimburse the Employee for the dues and assessments for such memberships.

 

(d)          Automobile.
So long as the Employee is employed by the Company pursuant to this Agreement, the Employee shall be entitled to continue to use
a Company-owned automobile of commensurate quality and value as that used by him on the same terms and conditions in effect with
respect to such use on the Effective Date of this Agreement. The Company shall provide and pay the premiums for full insurance
coverage on the automobile. Such insurance coverage shall be no less than the coverage provided on the Effective Date of this Agreement.
The Company shall also pay for the cost of operation, maintenance and repair of the automobile. All benefits referenced in this
subsection 4(d) are collectively referred to hereinafter as “Automobile Benefits.”

 

(e)          Vacation,
Sick Leave and Disability. The Employee shall be entitled to 30 days vacation annually and shall be entitled to the same sick
leave and disability leave as other executive employees. The Employee shall not receive any additional compensation on account
of his failure to take a vacation or sick leave, and the Employee shall not accumulate unused vacation or sick leave from one fiscal
year to the next, except in either case to the extent authorized by the Company or permitted for other executive employees.

 

In addition
to the aforesaid paid vacations, the Employee shall be entitled, without loss of pay, to absent himself voluntarily from the performance
of his employment with the Company for such additional periods of time and for such valid and legitimate reasons as the Company
may determine and to attend the continuing legal education seminars contemplated by subsection 4(c) hereof. Further, the Company
may grant to the Employee a leave or leaves of absence, with or without pay, at such time or times and upon such terms and conditions
as the board of directors of the Bank or the Company in its discretion may determine.

 

    	3

    	 

    

 

(f)          Other
Policies. All other matters relating to the employment of the Employee not specifically addressed in this Agreement shall be
subject to the general policies regarding executive employees of the Company as in effect from time to time.

 

5.          Term
of Employment. The Company hereby employs the Employee, and the Employee hereby accepts such employment under the terms of
this Agreement, for the period commencing on the Effective Date and ending 36 months thereafter (or such earlier date as is determined
in accordance with Section 8). The Employee’s term of employment may be extended for additional one-year periods beyond the
Agreement’s expiration date if the Compensation Committee of the Board of Directors of the Corporation so determines in a
duly adopted resolution. The initial term of this Agreement and all extensions thereof are hereinafter referred to individually
and collectively as the “Term.”

 

6.          Covenants.

 

(a)          Loyalty.

 

(i)          During
the period of his employment hereunder and except for illnesses, reasonable vacation periods, and reasonable leaves of absence,
the Employee shall devote all of his full business time, attention, skill and efforts to the faithful performance of his duties
hereunder; provided, however, from time to time, the Employee may serve on the boards of directors of, and hold any other offices
or positions in, companies or organizations, and may perform legal services either directly or as a result of an of counsel or
analogous position with a law firm for clients which will not present any conflict of interest with the Bank or the Corporation
or any of their subsidiaries or affiliates, or unfavorably affect the performance of Employee’s duties pursuant to this Agreement,
or will not violate any applicable statute or regulation. “Full business time” is hereby defined as that amount of
time usually devoted to like companies by similarly situated executive officers. During the term of his employment under this Agreement,
the Employee shall not engage in any business or activity contrary to the business affairs or interests of the Company, or be gainfully
employed in any other position or job other than as provided above.

 

(ii)         Nothing
contained in this Section shall be deemed to prevent or limit the Employee’s right to invest in the capital stock or other
securities of any business dissimilar from that of the Company, or, solely as a passive or minority investor, in any business.

 

    	4

    	 

    

 

(b)          Nonsolicitation.
The Employee hereby understands and acknowledges that, by virtue of his position with the Company, he will have advantageous familiarity
and personal contacts with the Company’s customers, wherever located, and the business, operations and affairs of the Company.
Accordingly, while the Employee is employed by the Company and for a period of one year after the Employee’s Separation from
Service (as defined in Section 8(h)(ii) of this Agreement) for any reason (whether with or without cause or whether by the Company
or the Employee) or the expiration of the Term, the Employee shall not, directly or indirectly, or individually or jointly, (i)
solicit any non-legal business of any party which is a customer of the Company at the time of such Separation from Service or any
party which was a customer of the Company during the one year period immediately preceding such Separation from Service, (ii) request
or advise any customers or suppliers of the Company to terminate, reduce, limit or change their business or relationship with the
Company, or (iii) induce, request or attempt to influence any employee of the Company to terminate his employment with the Company,
unless such actions are taken in connection with Employee engaging in the practice of law.

 

For purposes
of this Agreement, the term “solicit” means any direct or indirect communication of any kind whatsoever, regardless
of by whom initiated, which encourages or requests any person or entity, in any manner, to cease doing business with the Company.

 

(c)          Noncompetition.
During the period of his employment hereunder, and for a period of one year following the termination hereof, the Employee shall
not, directly or indirectly:

 

(i)          As
owner, officer, director, stockholder, investor, proprietor, organizer or otherwise, engage in the same trade or business as the
Company, as conducted on the date hereof, which would conflict with the interests of the Company or in a trade or business competitive
with that of the Company, which would conflict with the interests of the Company, as conducted on the date hereof; or

 

(ii)         Offer
or provide employment (whether such employment is with the Employee or any other business or enterprise), either on a full-time
or part-time or consulting basis, to any person who then currently is, or who within one (1) year prior to such offer or provision
of employment has been, a management-level employee of the Bank or Corporation. This subsection 6(c)(ii) shall only apply in the
event the Employee has a voluntary Separation from Service.

 

The restrictions
contained in this paragraph upon the activities of the Employee following Separation from Service shall be limited to the following
geographic areas (hereinafter referred to as “Restricted Geographical Area”):

 

(1)         Terre
Haute, Indiana; and

 

(2)         The
30-mile radius of Terre Haute, Indiana.

 

Nothing contained
in this Section 6 shall prevent or restrict the Employee from engaging in the practice of law, including within the Restricted
Geographical Area. In addition, nothing contained in this subsection shall prevent or limit the Employee’s right to invest
in the capital stock or other securities of any business dissimilar from that of the Bank or the Corporation, or, solely as a passive
or minority investor, in any business.

 

    	5

    	 

    

 

If the Employee
does not comply with the provisions of this Section, the one-year period of non-competition provided herein shall be tolled and
deemed not to run during any period(s) of noncompliance, the intention of the parties being to provide one full year of non-competition
by the Employee after the termination or expiration of this Agreement.

 

(d)          Nondisclosure.
The term “Confidential Information” as used herein shall mean any and all customer lists, computer hardware, software
and related material, trade secrets (as defined in I.C. 24-2-3-2), know-how, skills, knowledge, ideas, knowledge of customer’s
commercial requirements, pricing methods, sales and marketing techniques, dealer relationships and agreements, financial information,
intellectual property, codes, research, development, research and development programs, processes, documentation, or devices used
in or pertaining to the Company’s business (i) which relate in any way to the Company’s business, products or processes;
or (ii) which are discovered, conceived, developed or reduced to practice by the Employee, either alone or with others either during
the Term, at the Company’s expense, or on the Company’s premises.

 

(i)          During
the course of his services hereunder the Employee may become knowledgeable about, or become in possession of, Confidential Information.
If such Confidential Information were to be divulged or become known to any competitor of the Company or to any other person outside
the employ of the Company, or if the Employee were to consent to be employed by any competitor of the Company or to engage in competition
with the Company, the Company would be irreparably harmed. In addition, the Employee has or may develop relationships with the
Company’s customers which could be used to solicit the business of such customers away from the Company. The Company and
the Employee have entered into this Agreement to guard against such potential harm.

 

(ii)         The
Employee shall not, directly or indirectly, use any Confidential Information for any purpose other than the benefit of the Company
or communicate, deliver, exhibit or provide any Confidential Information to any person, firm, partnership, corporation, organization
or entity, except as required in the normal course of the Employee’s service as a consultant or as an employee of the Company.
The covenant contained in this subsection shall be binding upon the Employee during the Term and following the termination hereof
until either (i) such Confidential Information becomes obsolete; or (ii) such Confidential Information becomes generally known
in the Company’s trade or industry by means other than a breach of this covenant.

 

(iii)        The
Employee agrees that all Confidential Information and all records, documents and materials relating to such Confidential Information,
shall be and remain the sole and exclusive property of the Company.

 

    	6

    	 

    

 

(e)          Remedies.
The Employee agrees that the Company will suffer irreparable damage and injury and will not have an adequate remedy at law in the
event of any breach by the Employee of any provision of this Section. Accordingly, in the event the Company seeks, under law or
in equity, a temporary restraining order, permanent injunction or a decree of specific performance of the provisions of this Section,
no bond or other security shall be required. The Company shall be entitled to recover from the Employee, reasonable attorneys’
fees and expenses incurred in any action wherein the Company successfully enforces any of the provisions of this Section against
the breach or threatened breach of those provisions by the Employee. The remedies described in this Section are not exclusive and
are in addition to all other remedies the Company may have at law, in equity, or otherwise.

 

(i)          The
Employee and the Company acknowledge and agree that in the event of the Employee’s Separation from Service for any reason
whatsoever, the Employee can obtain other engagements or employment of a kind and nature similar to that contemplated herein outside
the Restricted Geographical Area and that the issuance of an injunction to enforce the provisions of this Section will not prevent
him from earning a livelihood.

 

(ii)         The
covenants on the part of the Employee contained in this Section are essential terms and conditions to the Company entering into
this Agreement, and shall be construed as independent of any other provision in this Agreement.

 

(f)          Surrender
of Records. Upon the Employee’s Separation from Service for any reason, the Employee shall immediately surrender to the
Company any and all computer hardware, software and related materials, records, notes, documents, forms, manuals, photographs,
instructions, lists, drawings, blueprints, programs, diagrams or other written or printed material (including any and all copies
made at any time whatsoever) in his possession or control which pertain to the business of the Company including any Confidential
Information in the Employee’s personal notes, address books, calendars, rolodexes, personal data assistants, etc.

 

7.          Standards.
The Employee shall perform his duties under this Agreement in accordance with such reasonable standards as the Board may establish
from time to time. The Company will provide the Employee with the working facilities and staff commensurate with his position
or positions and necessary or advisable for him to perform his duties.

 

8.          Separation
from Service and Termination Pay. Subject to Section 10 hereof, the Employee may experience a Separation from Service under
the following circumstances:

 

(a)          Death.
The Employee shall experience a Separation from Service upon his death during the Term of this Agreement, in which event the Employee’s
estate or designated beneficiaries shall be entitled to receive the base salary, bonuses, vested rights, and Employee Benefits
due the Employee through the last day of the calendar month in which his death occurred. Any benefits payable under insurance,
health, retirement, bonus, incentive, performance or other plans as a result of the Employee’s participation in such plans
through such date shall be paid when and as due under those plans. If the Employee’s death occurs on or after Retirement
Age, during the term of this Agreement, the Employee’s spouse and child living in his household at the time of his death
shall be entitled to receive the health and disability benefits provided for under subsection 4(b) until the death of his spouse.

 

    	7

    	 

    

 

(b)          Disability.

 

(i)          The
Company may terminate the Employee’s employment, resulting in a Separation from Service, as a result of the Employee’s
Disability, in a manner consistent with the Company’s and the Employee’s rights and obligations under the Americans
with Disabilities Act or other applicable state and federal laws concerning disability. For the purpose of this Agreement, “Disability”
means the Employee is:

 

(1)         Unable
to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment which can be
expected to result in death or can be expected to last for a continuous period of not less than 12 months, or

 

(2)         By
reason of any medically determinable physical or mental impairment which can be expected to result in death or can be expected
to last for a continuous period of not less than 12 months, receiving income replacement benefits for a period of not less than
three months under an accident and health plan covering employees of the Employer.

 

(ii)         During
any period that the Employee shall receive disability benefits and to the extent that the Employee shall be physically and mentally
able to do so, he shall furnish such information, assistance and documents so as to assist in the continued ongoing business of
the Company.

 

(iii)        In
the event of the Employee’s Separation from Service due to Disability, the Employee shall be entitled to receive the base
salary, bonuses, vested rights, and Employee Benefits due the Employee through his date of termination. Any benefits payable under
insurance, health, retirement, bonus, incentive, performance or other plans as a result of the Employee’s participation in
the plans through the date of termination shall be paid when and as due under those plans. If the Employee’s Separation from
Service due to Disability occurs on or after Retirement Age, during the term of this Agreement, the Employee shall be entitled
to the retirement benefits provided for under subsection 4(b) as described in that subsection.

 

(c)          Just
Cause. The Company may, by written notice to the Employee, immediately terminate his employment at any time, resulting in a
Separation from Service, for Just Cause. The Employee shall have no right to receive any base salary, bonuses or other Employee
Benefits, except as provided by law, whatsoever, for any period after his Separation from Service for Just Cause. However, the
vested rights of the Employee as of his Separation from Service shall not be affected. Any benefits payable under insurance, health,
retirement, bonus, incentive, performance or other plans as a result of the Employee’s participation in such plans through
such date of Separation of Service shall be paid when and as due under those plans. Separation from Service for “Just Cause”
shall mean termination because of:

 

    	8

    	 

    

 

(i)          An
intentional act of fraud, embezzlement, theft, or personal dishonesty; willful misconduct, or breach of fiduciary duty involving
personal profit by the Employee in the course of his employment or director service. No act or failure to act shall be deemed to
have been intentional or willful if it was due primarily to an error in judgment or negligence. An act or failure to act shall
be considered intentional or willful if it is not in good faith and if it is without a reasonable belief that the action or failure
to act is in the best interest of the Company;

 

(ii)         Intentional
wrongful damage by the Employee to the business or property of the Company, causing material harm to the Company;

 

(iii)        Breach
by the Employee of any confidentiality or non-disclosure agreement in effect from time to time with the Company;

 

(iv)         Gross
negligence or insubordination by the Employee in the performance of his duties; or

 

(v)          Removal
or permanent prohibition of the Employee from participating in the conduct of Bank’s affairs by an order issued under Section
8(e)(iv) or 8(g)(i) of the Federal Deposit Insurance Act, 12 USC 1818(e)(4) and (g)(1).

 

Notwithstanding
the foregoing, in the event of Separation from Service for Just Cause there shall be delivered to the Employee a copy of a resolution
duly adopted by the affirmative vote of not less than a majority of the disinterested directors of the Bank and the Corporation
at meetings of the boards called and held for that purpose (after reasonable notice to the Employee and an opportunity for the
Employee, together with the Employee’s counsel, to be heard before the boards), such meetings and the opportunity to be heard
to be held prior to, or as soon as reasonably practicable following, termination, but in no event later than 60 days following
such termination, finding that in the good faith opinion of the boards the Employee was guilty of conduct constituting Just Cause
and specifying the particulars thereof in detail. If, following such meetings, the Employee is reinstated, he shall be entitled
to receive the base salary, bonuses, all Employee Benefits, and all other fringe benefits provided for under this Agreement for
the period following Separation from Service and continuing through reinstatement as though he was never terminated.

 

(d)          Without
Just Cause. The Company may, by written notice to the Employee, immediately terminate his employment at any time, resulting
in a Separation from Service, for a reason other than Just Cause, in which event the Employee shall be entitled to receive the
following compensation and benefits (unless such Separation from Service occurs within the time period set forth in subsection
10(a) hereof, in which event the benefits and compensation provided for in Section 10 shall apply):

 

    	9

    	 

    

 

(i)          The
base salary provided pursuant to Section 2 hereof, as in effect on the date of Separation from Service, through the Expiration
Date of this Agreement as determined pursuant to Section 5 hereof (including any renewal or extension of this Agreement) (the “Expiration
Date”);

 

(ii)         An
amount equal to the bonuses received by or payable to the Employee in the calendar year prior to the calendar year of the Employee’s
Separation from Service, for each year remaining through the Expiration Date; and

 

(iii)        Cash
reimbursement to the Employee in an amount equal to the cost to the Employee (demonstrated by submission to the Company of invoices,
bills, or other proof of payment by the Employee) of (A) all health insurance premiums for the Employee, his spouse and child living
in the Employee’s household and the best level Medicare supplement insurance available which includes prescription drug coverage,
and life insurance (all as described in subsection 4(b)); (B) all other Employee Benefits (all as defined in subsection 4(a) excluding
benefits under the First Financial Corporation 2011 Omnibus Equity Incentive Plan (the “2011 Omnibus Plan”) which will
be made in accordance with the terms and conditions of that Plan); and (C) professional and club dues, the cost of Employee’s
continuing legal education requirements (as described in subsection 4(c)), all Automobile Benefits (as defined in subsection 4(d))
and all other benefits which the Employee would otherwise have been eligible to participate in or receive, through the Expiration
Date, based upon the benefit levels substantially equal to those provided for the Employee at the date of the Employee’s
Separation from Service. The Employee shall also be entitled to receive an amount necessary to provide any cash payments received
under this subsection 8(d)(iii) net of all income and payroll taxes that would not have been payable by the Employee had he continued
participation in the benefit plan or program instead of receiving cash reimbursement.

 

Notwithstanding
the foregoing, but only to the extent required under federal banking law, the amount payable under subsection 8(d) shall be reduced
to the extent that on the date of the Employee’s Separation from Service, the present value of the benefits payable under
subsection 8(d) exceeds any limitation on severance benefits that is imposed by the Office of the Comptroller of the Currency (the
“OCC”) on such benefits.

 

All amounts
payable to the Employee under subsections 8(d)(i) and 8(d)(ii) shall be paid in one lump sum within ten days of such Separation
from Service. All amounts payable to the Employee under subsection 8(d)(iii) shall be paid on the first day of each month following
the Employee’s Separation from Service, in an amount equal to the total reimbursable amount (demonstrated by invoices, bills
or other proof of payment submitted by the Employee). Such amounts must be submitted for reimbursement no later than the earlier
of: (i) six months after the date such amounts are paid by the Employee; or (ii) March 15th of the year following the year in which
the Employee paid the amount.

 

    	10

    	 

    

 

(e)          Voluntary
for Good Reason. The Employee may voluntarily Separate from Service under this Agreement at any time for Good Reason. In the
event that the Employee has a Separation from Service for Good Reason, the Employee will first deliver to the Company a written
notice which will (A) indicate the specific provisions of this Agreement relied upon for such Separation from Service, (B) set
forth in reasonable detail the facts and circumstances claimed to provide a basis for such Separation from Service, and (C) describe
the steps, actions, events or other items that must be taken, completed or followed by the Company to correct or cure the basis
for such Separation from Service. The Company will then have 30 days following the effective date of such notice to fully correct
and cure the basis for the Separation from Service. If the Company does not fully correct and cure the basis for the Employee’s
Separation from Service within such 30-day period, then the Employee will have the right to Separate from Service with the Company
for Good Reason immediately upon delivering to the Company a written Notice of Termination and without any further cure period.
Notwithstanding the foregoing, the Company will be entitled to so correct and cure only a maximum of two times during any calendar
year. The Employee shall thereupon be entitled to receive the same amount payable under subsections 8(d)(i) and (ii) hereof, within
30 days following his date of Separation from Service and under subsection 8(d)(iii) as provided in subsection 8(d).

 

For purposes
of this Agreement, “Good Reason” means the occurrence of any of the following events, which has not been consented
to in advance by the Employee in writing (unless such voluntary Separation from Service occurs within the time period set forth
in subsection 10(b) hereof, in which event the benefits and compensation provided for in Section 10 shall apply):

 

(i)          The
requirement that the Employee perform his executive functions more than 30 miles from his Terre Haute, Indiana office;

 

(ii)         A
reduction of ten percent or more in the Employee’s base salary, unless part of an institution-wide reduction and similar
to the reduction in the base salary of all other executive officers of the Company;

 

(iii)        The
removal of the Employee from participation in any incentive compensation or performance-based compensation plans or bonus plans
unless the Company terminates participation in the plan or plans with respect to all other executive officers of the Company;

 

(iv)         A
material failure by the Company to continue to provide the Employee with the base salary, bonuses or benefits provided for under
subsections 4(a), (c), (d) and (e) of this Agreement, as the same may be increased from time to time, or with benefits substantially
similar to those provided to him under those Sections or under any benefit plan or program in which the Employee now or hereafter
becomes eligible to participate, or the taking of any action by the Company which would directly or indirectly reduce in a material
manner any such benefits or deprive the Employee to a material degree of any such benefit enjoyed by him, unless part of an institution-wide
reduction and applied similarly to all other executive officers of the Company:

 

    	11

    	 

    

 

(v)          The
assignment to the Employee of duties and responsibilities materially different from those normally associated with his position
as referenced in Section 1;

 

(vi)         A
failure to elect or re-elect the Employee to the Bank’s board of directors or a failure on the part of the Corporation to
honor its obligation to nominate Employee to the Corporation’s board of directors;

 

(vii)        A
material diminution or reduction in the Employee’s responsibilities or authority (including reporting responsibilities) in
connection with his employment with the Company; or

 

(viii)      A
material reduction in the secretarial or administrative support of the Employee.

 

Notwithstanding the
foregoing, but only to the extent required under federal banking law, the amount payable under this subsection shall be reduced
to the extent that on the date of the Employee’s Separation from Service, the present value of the benefits payable under
subsections 8(d)(i), (ii) and (iii) exceed any limitation on severance benefits that is imposed by the OCC on such benefits.

 

(f)          Voluntary
Separation from Service Prior to Retirement Age. Subject to subsection 4(b) and Section 10, the Employee may voluntarily Separate
from Service with the Company during the term of this Agreement prior to attaining Retirement Age, upon at least 90 days’
prior written notice to the Company, in which case, effective as of the Separation from Service, the Employee shall receive only
his base salary, bonuses, vested rights and benefits up to the date of his Separation from Service, such benefits to be paid when
and as due under those plans (unless such Separation from Service occurs pursuant to subsection 10(b) hereof, in which event the
benefits, bonuses and base salary provided for in subsection 10(a) shall apply).

 

(g)          Termination
or Suspension Under Federal Law.

 

(i)          If
the Employee is removed and/or permanently prohibited from participating in the conduct of the Company’s affairs by an order
issued under Sections 8(e)(iv) or 8(g)(i) of the Federal Deposit Insurance Act (“FDIA”) (12 U.S.C. 1818(e)(4) and (g)(1)),
all obligations of the Company under this Agreement shall terminate, as of the effective date of the order, but vested rights of
the Employee shall not be affected.

 

(ii)         If
the Bank is in default (as defined in Section 3(x)(1) of the FDIA), all obligations under this Agreement shall terminate as of
the date of default; but the vested rights of the Employee shall not be affected.

 

    	12

    	 

    

 

(iii)        All
obligations under this Agreement shall terminate, except to the extent it is determined that the continuation of this Agreement
is necessary for the continued operation of the Bank; (A) by the OCC or its designee, at the time that the Federal Deposit Insurance
Corporation (“FDIC”) enters into an agreement to provide assistance to or on behalf of the Bank under the authority
contained in Section 13(c) of FDIA; or (B) by the OCC, or its designee, at the time that the OCC or its designee approves a supervisory
merger to resolve problems related to operation of the Bank or when the Bank is determined by the OCC to be in an unsafe or unsound
condition. Such action shall not affect any vested rights of the Employee.

 

(iv)         If
a notice served under Section 8(e)(3) or (g)(1) of the FDIA suspends and/or temporarily prohibits the Employee from participating
in the conduct of the Bank’s affairs, the Bank’s obligations under this Agreement shall be suspended as of the date
of such service, unless stayed by appropriate proceedings. However, the vested rights of the Employee as of the date of suspension
will not be affected. If the charges in the notice are dismissed, the Bank may in its discretion (A) pay the Employee all or part
of the compensation withheld while its contract obligations were suspended, and (B) reinstate (in whole or in part) any of its
obligations which were suspended.

 

(h)          Separation
from Service. If the Employee qualifies as a Key Employee (as defined in subsection 8(h)(i)) at the time of his Separation
from Service (as defined in subsection 8(h)(ii)), the Company may not make a payment pursuant to subsections 8(d) (disregarding
subsection 8(d)(iii)(A)), 8(e) or Section 10 (disregarding subsection 10(a)(1)(ii)(C)) earlier than six months following the date
of the Employee’s Separation from Service (or, if earlier, the date of the Employee’s death) to the extent such a payment
would constitute deferred compensation that is not exempt from the requirements of Code Section 409A or Treasury Regulations 1.409A-1
et. seq. Payments to which the Key Employee would otherwise be entitled during the first six months following the date of
his Separation from Service will be accumulated and paid to the Employee on the first day of the seventh month following the Employee’s
Separation from Service.

 

(i)          Key
Employee means an employee who is:

 

(1)         An
officer of the Bank or Corporation having annual compensation greater than $160,000;

 

(2)         A
five percent owner of the Corporation; or

 

(3)         A
one percent owner of the Corporation having an annual compensation from the employer of more than $150,000.

 

The $160,000 amount in subsection
8(h)(i)(1) will be adjusted at the same time and in the same manner as under Code Section 415(d), except that the base period shall
be the calendar quarter beginning July 1, 2001, and any increase under this sentence which is not a multiple of $5,000 shall be
rounded to the next lower multiple of $5,000.

 

    	13

    	 

    

 

(ii)         Separation
from Service means the date on which the Employee dies, retires or otherwise experiences a “Termination of Employment”
with the Company (as defined below). Provided, however, a Separation from Service does not occur if the Employee is on military
leave, sick leave or other bona fide leave of absence if the period of such leave does not exceed six months, or if longer, so
long as the Employee retains a right to reemployment with the Company under an applicable statute or by contract. For purposes
of this subsection 8(h)(ii), a leave of absence constitutes a bona fide leave of absence only if there is a reasonable expectation
that the Employee will return to perform services for the Bank or Corporation. If the period of leave exceeds six months and the
Employee does not retain the right to reemployment under an applicable statute or by contract, the employment relationship is deemed
to terminate on the first date immediately following such six-month period. Notwithstanding the foregoing, where a leave of absence
is due to any medically determinable physical or mental impairment that can be expected to result in death or can be expected to
last for a continuous period of not less than six months, where such impairment causes the Employee to be unable to perform the
duties of his position of employment or any substantially similar position of employment, a 29-month period of absence may be substituted
for such six-month period. The Employee shall incur a “Termination of Employment” for purposes of this subsection 8(h)(ii)
when a termination of employment has occurred under Treasury Regulation 1.409A-1(h)(1)(ii).

 

9.          No
Mitigation. The Employee shall not be required to mitigate the amount of any payment provided for in this Agreement by seeking
other employment or otherwise and no such payment shall be offset or reduced by the amount of any compensation or benefits provided
to the Employee in any subsequent employment.

 

10.        Change
in Control.

 

(a)          Change
in Control; Involuntary Separation from Service.

 

(1)         Notwithstanding
any provision herein to the contrary, if the Employee’s employment under this Agreement is terminated by the Company, resulting
in a Separation from Service, without the Employee’s prior written consent and for a reason other than Just Cause, in connection
with or within 12 months after a Change in Control, as defined in subsection 10(a)(3), the Employee shall be paid (subject to subsection
10(a)(2)) the greater of:

 

(i)          The
total amount payable under subsection 8(d); or

 

    	14

    	 

    

 

(ii)         The
product of 2.99 times the sum of: (A) his base salary in effect as of the date of the Change in Control; (B) an amount equal to
any annual discretionary or performance-based incentive bonus received by or payable to the Employee in the calendar year prior
to the year in which the Change in Control occurs; and (C) cash reimbursement to the Employee in an amount equal to the cost to
the Employee (demonstrated by submission to the Company of invoices, bills or other proof of payment by the Employee) of obtaining
all Employee Benefits (all as defined in subsection 4(a) excluding benefits under the 2011 Omnibus Plan which will be paid in accordance
with the terms and conditions of that plan), health insurance premiums for the Employee, his spouse and child living in the Employee’s
household, best level Medicare supplement insurance available which includes prescription drug coverage, life insurance (all as
described in subsection 4(b)), professional and club dues, the cost of Employee’s continuing legal education requirements
(all as described in subsection 4(c)), all Automobile Benefits (as defined in subsection 4(d)) and all other benefits which the
Employee would otherwise have been eligible to participate in or receive, through the Expiration Date, based upon the benefit levels
substantially equal to those that the Company provided for the Employee at the date of the Employee’s Separation from Service.
The Employee shall also be entitled to receive an amount necessary to provide any cash payments received under this subsection
10(a)(1)(ii) net of all income and payroll taxes that would not have been payable by the Employee had he continued participation
in the benefit plan or program instead of receiving cash reimbursement.

 

(2)         To
the extent payments that would be received based on the Employee’s Separation from Service in connection with a Change in
Control, or within 12 months after a Change in Control would be considered “excess parachute payments” pursuant to
the Code Section 280G, the benefit payment to the Employee under this Agreement, when combined with all other parachute payments
to the Employee, shall be the greater of:

 

(i)          the
Employee’s benefit under the Agreement reduced to the maximum amount payable to the Employee such that when it is aggregated
with payments and benefits under all other plans and arrangements it will not result in an “excess parachute payment;”
or

 

(ii)         the
Employee’s benefit under the Agreement after taking into account the amount of the excise tax imposed on the Employee under
Code Section 280G due to the benefit payment.

 

The determination of whether any
reduction in the rights or payments under this Plan is to apply will be made by the Company in good faith after consultation with
the Employee, and such determination will be conclusive and binding on the Employee. The Employee will cooperate in good faith
with the Company in making such determination and providing the necessary information for this purpose.

 

    	15

    	 

    

 

(3)         “Change
in Control” shall be deemed to have occurred if one of the following events takes place:

 

(i)          Change
in Ownership. A change in the ownership of the Bank or the Corporation occurs on the date that any person, or group of persons,
as defined below, acquires ownership of stock of the Bank or the Corporation that, together with stock held by the person or group,
constitutes more than 50 percent of the total fair market value or total voting power of the stock of the Bank or the Corporation.
However, if any person or group is considered to own more than 50 percent of the total fair market value or total voting power
of the stock, the acquisition of additional stock by the same person or group is not considered to cause a change in the ownership
of the Bank or the Corporation (or to cause a change in the effective control of the Bank or the Corporation as defined in subsection
10(a)(3)(ii)). An increase in the percentage of stock owned by any person or group, as a result of a transaction in which the Bank
or the Corporation acquires its stock in exchange for property will be treated as an acquisition of stock for purposes of this
subsection. This subsection only applies when there is a transfer of stock of the Bank or the Corporation (or issuance of stock
of a corporation) and stock in the Bank or the Corporation remains outstanding after the transaction.

 

For purposes of subsections 10(a)(3)(i)
and (ii), persons will not be considered to be acting as a group solely because they purchase or own stock of the Bank or the Corporation
at the same time, or as a result of the same public offering. However, persons will be considered to be acting as a group if they
are owners of a corporation that enters into a merger, consolidation, purchase or acquisition of stock or similar business transaction
with the Bank or the Corporation. If a person, including an entity, owns stock in both corporations that enter into a merger, consolidation,
purchase or acquisition of stock or similar transaction, such shareholder is considered to be acting as a group with other shareholders
only with respect to the ownership in that corporation before the transaction giving rise to the change and not with respect to
the ownership interest in the other corporation.

 

(ii)         Change
in the Effective Control. A change in the effective control of the Bank or the Corporation will occur when: (i) any person
or group (as defined in subsection 10(a)(3)(i)) acquires, or has acquired during the 12-month period ending on the date of the
most recent acquisition by such person(s), ownership of stock of the Bank or the Corporation possessing 30 percent or more of the
total voting power; or (ii) a majority of members of the board of the Bank or the Corporation is replaced during any 12-month period
by directors whose appointment or election is not endorsed by a majority of the members of the Bank’s or Corporation’s
board prior to the date of the appointment or election. However, if any person or group is considered to effectively control the
Bank or Corporation, the acquisition of additional control of the Bank or Corporation by the same person(s) is not considered to
cause a change in the effective control.

 

    	16

    	 

    

 

(iii)        Change
in the Ownership of a Substantial Portion of the Bank’s or Corporation’s Assets. A change in the ownership
of a substantial portion of the Bank’s or Corporation’s assets occurs on the date that any person or group acquires,
or has acquired during the 12-month period ending on the date of the most recent acquisition by such person(s), assets from the
Bank or Corporation that have a total gross fair market value equal to or more than 40 percent of the total gross fair market value
of all of the assets of the Bank or Corporation immediately prior to such acquisition(s). Gross fair market value means the value
of the assets of the Bank or Corporation, or the value of the assets being disposed of, determined without regard to any liabilities
associated with such assets.

 

However, there is no Change in
Control under this subsection when there is a transfer to an entity that is controlled by the shareholders of the Bank or Corporation
immediately after the transfer. A transfer of assets by the Bank or Corporation is not treated as a change in the ownership of
such assets if the assets are transferred to: (i) a shareholder of the Bank or Corporation (immediately before the asset transfer)
in exchange for or with respect to its stock; (ii) an entity, 50 percent or more of the total value or voting power of which is
owned, directly or indirectly, by the Bank or Corporation; (iii) a person, or group of persons, that owns, directly or indirectly,
50 percent or more of the total value or voting power of all the outstanding stock of the Bank or Corporation or (iv) an entity,
at least 50 percent of the total value or voting power of which is owned, directly or indirectly, by a person described in (iii).
For purposes of this subsection, except as otherwise provided, a person’s status is determined immediately after the transfer
of the assets. For example, a transfer to a company in which the Bank or Corporation has no ownership interest before the transaction,
but which is a majority-owned subsidiary of the Bank or Corporation after the transaction, is not treated as a change in the ownership
of the assets of the transferor Bank or Corporation.

 

For purposes of this subsection
10(a)(3)(iii), persons will not be considered to be acting as a group solely because they purchase assets of the Bank or Corporation
at the same time. However, persons will be considered to be acting as a group if they are owners of a corporation that enters into
a merger, consolidation, purchase or acquisition of assets, or similar business transaction with the Bank or Corporation. If a
person, including an entity shareholder, owns stock in both corporations that enter into a merger, consolidation, purchase or acquisition
of assets, or similar transaction, such shareholder is considered to be acting as a group with other shareholders in a corporation
only to the extent of the ownership in that corporation before the transaction giving rise to the change and not with respect to
the ownership interest in the other corporation.

 

    	17

    	 

    

 

Notwithstanding
the foregoing, the acquisition of Bank or Corporation stock by any retirement plan sponsored by the Bank or an affiliate of the
Bank will not constitute a Change in Control. Additionally, notwithstanding the foregoing, but only to the extent required under
federal banking law, the amount payable under subsection 10(a) shall be reduced to the extent that on the date of the Employee’s
Separation from Service, the amount payable under subsection 10(a) exceeds any limitation on severance benefits that is imposed
by the OCC.

 

(b)          Change
in Control; Voluntary for Good Reason. Notwithstanding any other provision of this Agreement to the contrary, the Employee
may Separate from Service under this Agreement for Good Reason within 12 months following a Change in Control of the Bank or Corporation,
as defined in subsection 10(a)(3). In the event that the Employee has a Separation from Service for Good Reason within 12 months
following a Change in Control of the Bank or Corporation, the Employee will first deliver to the Company a written notice which
will (A) indicate the specific provisions of this Agreement relied upon for such Separation from Service, (B) set forth in reasonable
detail the facts and circumstances claimed to provide a basis for such Separation from Service, and (C) describe the steps, actions,
events or other items that must be taken, completed or followed by the Company to correct or cure the basis for such Separation
from Service. The Company will then have 30 days following the effective date of such notice to fully correct and cure the basis
for the Separation from Service. If the Company does not fully correct and cure the basis for the Employee’s Separation from
Service within such 30-day period, then the Employee will have the right to Separate from Service with the Company for Good Reason
immediately upon delivering to the Company a written Notice of Termination and without any further cure period. Notwithstanding
the foregoing, the Company will be entitled to so correct and cure only a maximum of two times during any calendar year.

 

The Employee
shall thereupon be entitled to receive the payment described in subsections 10(a)(1), (2) and (3) of this Agreement, within 30
days. During such 30-day period, the Bank shall not allow the Employee’s participation in any Employee Benefits to lapse
and shall continue to provide the Employee with the Automobile Benefits described in subsection 4(d), reimbursement or payment
of professional and club dues, and the cost of the Employee’s continuing legal education requirements as described in subsection
4(c). In the event subsection 8(h) applies at the time of the Employee’s termination, the six-month suspension period shall
not prevent the Employee from continuing to receive reimbursement of health insurance premiums for himself, his spouse and child
living in the Employee’s household, Medicare supplement insurance at the best level available which includes prescription
drug coverage, and life insurance (all as described in subsection 4(b)) immediately following his Separation from Service, without
regard to the six-month suspension applicable to cash payments and other benefit amounts.

 

    	18

    	 

    

 

For purposes of this subsection
10(b), “Good Reason” means, the occurrence of any of the following events, which has not been consented to in advance
by the Employee in writing:

 

(i)          The
requirement that the Employee perform his principal executive functions more than 30 miles from his Terre Haute, Indiana office.

 

(ii)         A
reduction of ten percent or more in the Employee’s base salary as in effect on the date of the Change in Control or as the
same may be changed by mutual agreement from time to time, unless part of an institution-wide reduction and similar to the reduction
in the base salary of all other executive officers of the Company;

 

(iii)        The
removal of the Employee from participation in any incentive or performance-based compensation plans or bonus plans unless the Company
terminates participation in the plan or plans with respect to all other executive officers of the Company;

 

(iv)         A
material failure by the Company to continue to provide the Employee with the base salary, bonuses or benefits provided for under
subsections 4(a), (c), (d) and (e) of this Agreement, as the same may be increased from time to time, or with benefits substantially
similar to those provided to him under those subsections or under any benefit plan or program in which the Employee now or hereafter
becomes eligible to participate, or the taking of any action by the Company which would directly or indirectly reduce in a material
manner any such benefits or deprive the Employee to a material degree of any such benefit enjoyed by him, unless part of an institution-wide
reduction and applied similarly to all other executive officers of the Company;

 

(v)          The
assignment to the Employee of duties and responsibilities materially different from those normally associated with his position
as referenced in Section 1;

 

(vi)         A
failure to elect or re-elect the Employee to the Bank’s board of directors or a failure on the part of the Corporation or
its successor to honor any obligation to nominate Employee to the board of directors of the Corporation or its successor;

 

(vii)        A
material diminution or reduction in the Employee’s responsibilities or authority (including reporting responsibilities) in
connection with his employment with the Company; or

 

(viii)      A
material reduction in the secretarial or administrative support of the Employee.

 

Notwithstanding
the foregoing, but only to the extent required under federal banking law, the amount payable under subsection 10(b) shall be reduced
to the extent that on the date of the Employee’s Separation from Service, the amount payable under subsection 10(b) exceeds
any limitation on severance benefits that is imposed by the OCC.

 

    	19

    	 

    

 

(c)          Compliance
with 12 U.S.C. Section 1828(k). Any payments made to the Employee pursuant to this Agreement, or otherwise, are subject to
and conditioned upon their compliance with 12 U.S.C. Section 1828(k) and any regulations promulgated thereunder.

 

(d)          Trust.

 

(1)         Within
five business days before or after a Change in Control which was not approved in advance by a resolution of a majority of the directors
of the Corporation, the Company shall (i) deposit, or cause to be deposited, in a grantor trust (the “Trust”), designed
to conform with Revenue Procedure 92-64 (or any successor) and having a trustee independent of the Bank, an amount equal to the
amounts which would be payable in a lump sum under subsections 10(a)(1), (2) and (3) hereof if those payment provisions become
applicable, and (ii) provide the trustee of the Trust with a written direction to hold said amount and any investment return thereon
in a segregated account for the benefit of the Employee, and to follow the procedures set forth in the next paragraph as to the
payment of such amounts from the Trust.

 

(2)         During
the 12 consecutive month period following the date on which the Company makes the deposit referred to in the preceding paragraph,
the Employee may provide the trustee of the Trust with a written notice requesting that the trustee pay to the Employee, in a single
sum, the amount designated in the notice as being payable pursuant to subsections 10(a)(1), (2) and (3). Within three business
days after receiving said notice, the trustee of the Trust shall send a copy of the notice to the Company via overnight and registered
mail, return receipt requested. On the tenth business day after mailing said notice to the Company, the trustee of the Trust shall
pay the Employee the amount designated therein in immediately available funds, unless prior thereto the Company provides the trustee
with a written notice directing the trustee to withhold such payment. In the latter event, the trustee shall submit the dispute,
within ten days of receipt of the notice from the Company, to non-appealable binding arbitration for a determination of the amount
payable to the Employee pursuant to subsections 10(a)(1), (2) and (3), and the party responsible for the payment of the costs of
such arbitration (which may include any reasonable legal fees and expenses incurred by the Employee) shall be determined by the
arbitrator. The Company and the Employee shall choose the arbitrator to settle the dispute, and such arbitrator shall be bound
by the rules of the American Arbitration Association in making his or her determination. If the Employee and the Company cannot
agree on an arbitrator, then the arbitrator shall be selected under the rules of the American Arbitration Association. The Employee,
the Company and the trustee shall be bound by the results of the arbitration and, within three days of the determination by the
arbitrator, the trustee shall pay from the Trust the amounts required to be paid to the Employee and/or the Company, and in no
event shall the trustee be liable to either party for making the payments as determined by the arbitrator.

 

    	20

    	 

    

 

(3)         Upon
the earlier of (i) any payment from the Trust to the Employee, or (ii) the date twelve months after the date on which the Company
makes the deposit referred to in subsection 10(d)(1)(i), the trustee of the Trust shall pay to the Company the entire balance remaining
in the segregated account maintained for the benefit of the Employee, if any. The Employee shall thereafter have no further interest
in the Trust pursuant to this Agreement. However, the termination of the Trust shall not operate as a forfeiture or relinquishment
of any of the Employee’s rights under the terms of this Agreement. Furthermore, in the event of a dispute under subsection
10(d)(2), the trustee of the Trust shall continue to hold, in trust, the deposit referred to in subsection 10(d)(1)(i) until a
final decision is rendered by the arbitrator pursuant to subsection 10(d)(2).

 

(e)          In
the event that any dispute arises between the Employee and the Company as to the terms or interpretation of this Agreement or the
obligations thereunder, including this Section, whether instituted by formal legal proceedings or submitted to arbitration pursuant
to subsection 10(d)(2), including any action that the Employee takes to enforce the terms of this Section or to defend against
any action taken by the Company, the Employee shall be reimbursed for all costs and expenses, including reasonable attorneys’
fees, arising from such dispute, proceedings or actions, provided that the Employee shall obtain a final judgment by a court of
competent jurisdiction in favor of the Employee or, in the event of arbitration pursuant to subsection 10(d)(2), a determination
is made by the arbitrator that the expenses should be paid by the Company. Such reimbursement shall be paid within ten days of
Employee’s furnishing to the Company written evidence, which may be in the form, among other things, of a canceled check
or receipt, of any costs or expenses incurred by the Employee.

 

Should the
Employee fail to obtain a final judgment in favor of the Employee and a final judgment or arbitration decision is entered in favor
of the Company and if decided by arbitration, the arbitrator, pursuant to subsection 10(d)(2), determines the Employee to be responsible
for the Company’s expenses, then the Company shall be reimbursed for all costs and expenses, including reasonable attorneys’
fees arising from such dispute, proceedings or actions. Such reimbursement shall be paid within ten days of the Company furnishing
to the Employee written evidence, which may be in the form, among other things, of a canceled check or receipt, of any costs or
expenses incurred by the Company.

 

11.         2011
Omnibus Plan Awards. Any awards to the Employee under the 2011 Omnibus Plan that are outstanding at the time of a Separation
from Service will be governed by the terms of the 2011 Omnibus Plan.

 

12.         Federal
Income Tax Withholding. The Bank may withhold all federal and state income or other taxes from any benefit payable under this
Agreement as shall be required pursuant to any law or governmental regulation or ruling.

 

    	21

    	 

    

 

13.         Successors
and Assigns.

 

(a)          Company.This
Agreement shall not be assignable by the Bank or Corporation, provided that this Agreement shall inure to the benefit of and be
binding upon any corporate or other successor of the Bank or Corporation which shall acquire, directly or indirectly, by merger,
consolidation, purchase or otherwise, all or substantially all of the assets or stock of the Bank or Corporation.

 

(b)          Employee.Because
the Company is contracting for the unique and personal skills of the Employee, the Employee shall be precluded from assigning or
delegating his rights or duties hereunder without first obtaining the written consent of the Company; provided, however, that nothing
in this paragraph shall preclude (i) the Employee from designating a beneficiary to receive any benefit payable hereunder upon
his death, or (ii) the executors, administrators, or other legal representatives of the Employee or his estate from assigning any
rights hereunder to the person or persons entitled thereunto.

 

(c)          Attachment.Except
as required by law, no right to receive payments under this Agreement shall be subject to anticipation, commutation, alienation,
sale, assignment, encumbrance, charge, pledge, or hypothecation or to exclusion, attachment, levy or similar process or assignment
by operation of law, and any attempt, voluntary or involuntary, to effect any such action shall be null, void and of no effect.

 

14.         Amendments.
No amendments or additions to this Agreement shall be binding unless made in writing and signed by the Bank, the Corporation and
the Employee, except as herein otherwise specifically provided.

 

15.         Applicable
Law. Except to the extent preempted by federal law, the laws of the State of Indiana, without regard to that State’s
choice of law principles, shall govern this Agreement in all respects, whether as to its validity, construction, capacity, performance
or otherwise.

 

16.         Severability.
The provisions of this Agreement shall be deemed severable and the invalidity or unenforceability of any provision shall not affect
the validity or enforceability of the other provisions hereof. Should any particular covenant, provision or clause of this Agreement
be held unreasonable or unenforceable for any reason, including without limitation, the time period, geographic area and/or scope
of activity covered by such covenant, provision or clause, the Company and Employee acknowledge and agree that such covenant, provision
or clause shall be given effect and enforced to whatever extent would be reasonable and enforceable under applicable law.

 

17.         Entire
Agreement. This Agreement: (a) supersedes all other understandings and agreements, oral or written, between the parties with
respect to the subject matter of this Agreement; and (b) constitutes the sole agreement between the parties with respect to this
subject matter; provided, however, that the benefit plans and arrangements referred to in this Agreement are not superseded or
replaced unless this Agreement specifically so states and such benefit plans and arrangements may be set forth in separate plan
documents stating their terms.

 

    	22

    	 

    

 

18.         Construction.
The rule of construction to the effect that any ambiguities are to be resolved against the drafting party shall not be employed
in the interpretation of this Agreement.

 

19.         Headings.
The headings in this Agreement have been inserted solely for ease of reference and shall not be considered in the interpretation,
construction or enforcement of this Agreement.

 

20.         Notices.
For purposes of this Agreement, notices and all other communications provided for herein shall be in writing and shall be deemed
to have been given (a) if hand delivered, upon delivery to the party, or (b) if mailed, two days following deposit of the notice
or communication with the United States Postal Service by registered or certified mail, return receipt requested, postage prepaid,
addressed as follows:

 

	If to the Employee:	Norman L. Lowery
	 	93 Allendale
	 	Terre Haute, Indiana 47802
	 	 
	 	 
	If to the Bank:	First Financial Bank, N.A.
	 	Attn: Chairman of the Board of Directors
	 	One First Financial Plaza
	 	P.O. Box 540
	 	Terre Haute, Indiana 47808-0540
	 	 
	With a copy to (which will not constitute notice):	Krieg DeVault LLP
	 	Attn: Sharon B. Hearn, Esq.
	 	One Indiana Square, Suite 2800
	 	Indianapolis, Indiana 46204
	 	 
	If to First Financial Corporation:	First Financial Corporation
	 	Attn: Chairman of the Board of Directors
	 	One First Financial Plaza
	 	P.O. Box 540
	 	Terre Haute, Indiana 47808-0540
	 	 
	With a copy to (which will not constitute notice):	Krieg DeVault LLP
	 	Attn: Sharon B. Hearn, Esq.
	 	One Indiana Square, Suite 2800
	 	Indianapolis, Indiana 46204

 

or to such other address as either party
hereto may have furnished to the other party in writing in accordance herewith, except that notices of change of address shall
be effective only upon receipt.

 

    	23

    	 

    

 

21.         Waiver.
The waiver by either party of a breach of any provision of this Agreement, or failure to insist upon strict compliance with the
terms of this Agreement, shall not be deemed a waiver of any subsequent breach or relinquishment of any right or power under this
Agreement.

 

22.         Review
and Consultation. Employee acknowledges and agrees he (a) has read this Agreement in its entirety prior to executing it, (b)
understands the provisions and effects of this Agreement and (c) has consulted with such attorneys, accountants and financial or
other advisors as he has deemed appropriate in connection with the execution of this Agreement. Employee understands, acknowledges
and agrees that he has not received any advice, counsel or recommendation with respect to this Agreement from Employer’s
attorneys.

 

IN WITNESS WHEREOF,
the parties have executed this Agreement on this 1st day of December, 2012.

 

	ATTEST	 	FIRST FINANCIAL BANK, N.A.
	 	 	 
	 	 	Rodger A. McHargue, Secretary/Treasurer
	Title: 	 	 	 
	 	 	 
	ATTEST	 	FIRST FINANCIAL CORPORATION
	 	 	 
	 	 	 
	 	 	Rodger A. McHargue, Secretary/Treasurer
	Title: 	 	 	 
	 	 	 
	 	 	EMPLOYEE
	 	 	 
	 	 	 
	 	 	Norman L. Lowery

 

    	24

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