Document:

EX-10.1

 Exhibit 10.1 

Execution Version 

SECURITIES PURCHASE AGREEMENT 

This SECURITIES PURCHASE AGREEMENT (this “Agreement”) is made and entered into as of February 19, 2021 by and among
Ayala Pharmaceuticals, Inc., a Delaware corporation (the “Company”), and the Investors identified on Exhibit A attached hereto (each an “Investor” and collectively, the “Investors”). 

RECITALS 
 A. The Company
and each Investor is executing and delivering this Agreement in reliance upon the exemption from securities registration afforded by Section 4(a)(2) of the 1933 Act (as defined below); and 

B. The Investors wish to purchase from the Company, and the Company wishes to sell and issue to the Investors, upon the terms and subject to
the conditions stated in this Agreement, (i) shares (the “Shares”) of the Company’s Common Stock, par value $0.01 per share (the “Common Stock”), (ii) warrants in the form attached hereto as Exhibit B-1 to purchase Common Stock (each, a “Common Warrant” and collectively, the “Common Warrants”) and (iii) pre-funded warrants in the
form attached hereto as Exhibit B-2 to purchase Common Stock (each, a “Pre-Funded Common Warrant” and collectively, the “Pre-Funded Common Warrants” and, together with the Common Warrants, the “Warrants”);. 

In consideration of the mutual promises made herein and for other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties hereto agree as follows: 
 1. Definitions. For the purposes of this Agreement, the following terms
shall have the meanings set forth below: 
 “Affiliate” means, with respect to any Person, any other Person which directly
or indirectly through one or more intermediaries Controls, is controlled by, or is under common Control with, such Person. 

“Business Day” means a day, other than a Saturday or Sunday, on which banks in New York City are open for the general
transaction of business. 
 “Closing” has the meaning set forth in Section 3.1. 

“Closing Date” has the meaning set forth in Section 3.1. 

“Closing Securities” means the Shares and the Warrants. 

“Common Warrants” has the meaning set forth in the recitals. 

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

Code” has the meaning set forth in Section 5.18. 

 “Company’s Knowledge” means the actual knowledge of the executive
officers (as defined in Rule 405 under the 1933 Act) of the Company. 
 “Control” (including the terms
“controlling”, “controlled by” or “under common control with”) means the possession, direct or indirect, of the power to direct or cause the direction of the management and policies of a Person, whether through the
ownership of voting securities, by contract or otherwise. 
 “EDGAR system” means the Electronic Data Gathering, Analysis,
and Retrieval system. 
 “Environmental Laws” has the meaning set forth in Section 4.15. 

“ERISA” has the meaning set forth in Section 5.18. 

“Evaluation Date” has the meaning set forth in Section 4.23. 

“FDA” has the meaning set forth in Section 4.25. 

“GAAP” has the meaning set forth in Section 4.17. 

“Health Care Laws” means the Federal Food, Drug, and Cosmetic Act (21 U.S.C. §§ 301 et seq.), the regulations
promulgated by other similar local, state or federal law and regulations. 
 “Indemnified Party” has the meaning set forth
in Section 8.4. 
 “Indemnifying Party” has the meaning set forth in Section 8.4. 

“Investor Indemnified Party” has the meaning set forth in Section 8.2. 

“Intellectual Property” means all patents, patent applications, trademarks, trademark applications, service marks, trade
names, copyrights, trade secrets, licenses, domain names, information and proprietary rights and processes. 
 “Intellectual
Property Rights” has the meaning set forth in Section 4.14. 
 “Investor Questionnaire” has the meaning set
forth in Section 3.1. 
 “Majority Investors” has the meaning set forth in Section 6.3(a)(i). 

“Material Adverse Effect” means a material adverse effect on (i) the assets, liabilities, results of operations,
financial condition or business of the Company and its Subsidiary taken as a whole, (ii) the legality or enforceability of any of the Transaction Documents or (iii) the ability of the Company to perform its obligations under the
Transaction Documents; provided, however, that in no event shall any of the following occurring after the date hereof, alone or in combination, be deemed to constitute, or be taken into account in determining whether, a Material
Adverse Effect has occurred: any effect caused by the announcement or pendency of the transactions contemplated by the Transaction Documents, or the identity of any Investor or any of its Affiliates as the purchaser in connection with the
transactions contemplated by this Agreement or any change in the market price of the Common Stock. 

  
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 “Material Contract” means any contract, instrument or other agreement to
which the Company is a party or by which it is bound which is material to the business of the Company, including those that have been filed as an exhibit to the SEC Filings pursuant to Item 601(b)(10) of Regulation
S-K. 
 “Nasdaq” means The Nasdaq Global Market. 

“Person” means an individual, corporation, partnership, limited liability company, trust, business trust, association, joint
stock company, joint venture, sole proprietorship, unincorporated organization, governmental authority or any other form of entity not specifically listed herein. 

“Placement Agent” means Jefferies LLC. 

“Pre-Funded Common Warrants” has the meaning set forth in the Recitals. 

“Pre-Funded Common Warrant Shares” means the shares of Common Stock issuable upon
exercise of the Pre-Funded Common Warrants. 
 “Press Release” has the meaning set
forth in Section 9.7. 
 “Registrable Securities” means (i) the Shares and Warrant Shares and (ii) any other
shares of Common Stock issued as a dividend or other distribution with respect to, in exchange for or in replacement of the Shares or Warrant Shares; provided, however, that any such Registrable Securities shall cease to be Registrable
Securities (and the Company shall not be required to maintain the effectiveness of any, or file another, registration statement hereunder with respect thereto) upon the first to occur of (A) a registration statement with respect to the sale of
such Registrable Securities being declared effective by the SEC under the 1933 Act and such Registrable Securities having been disposed of or transferred by the holder thereof in accordance with such effective Registration Statement, (B) such
Registrable Securities having been previously sold or transferred in accordance with Rule 144 (or another exemption from the registration requirements of the 1933 Act), (C) such securities becoming eligible for resale without volume or manner-of-sale restrictions and without current public information requirements pursuant to Rule 144 and (D) the first anniversary of the Closing Date. 

“Regulation D” means Regulation D as promulgated by the SEC under the 1933 Act. 

“Rule 144” means Rule 144 promulgated under the 1933 Act (or any successor rule). 

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

“SEC Filings” has the meaning set forth in Section 4.7. 

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

  
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 “Shares” has the meaning set forth in the recitals to this Agreement. 

“Short Sales” means all “short sales” as defined in Rule 200 of Regulation SHO under the 1934 Act (but shall not be
deemed to include the location and/or reservation of borrowable shares of Common Stock). 
 “Subscription Amount” means, as
to an Investor, the aggregate amount to be paid for the Closing Securities purchased hereunder as specified opposite such Investor’s name on Exhibit A attached hereto, under the column entitled “Aggregate Purchase Price of Closing
Securities,” in U.S. Dollars and in immediately available funds. 
 “Subsidiary” has the meaning set forth in
Section 4.1. 
 “Trading Day” means a day on which Nasdaq is open for trading. 

“Transfer Agent” has the meaning set forth in Section 7.2. 

“Transaction Documents” means this Agreement and the Warrants. 

“Warrants” has the meaning set forth in the Recitals. 

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

“1933 Act” means the Securities Act of 1933, as amended, or any successor statute, and the rules and regulations promulgated
thereunder. 
 “1934 Act” means the Securities Exchange Act of 1934, as amended, or any successor statute, and the rules
and regulations promulgated thereunder. 
 2. Purchase and Sale of the Shares and Warrants. On the Closing Date, upon the terms and
subject to the conditions set forth herein, the Company will issue and sell, and each Investor will purchase, severally and not jointly, (i) the number of Shares set forth opposite the name of such Investor under the heading “Number of
Shares” on Exhibit A attached hereto, at a price per Share equal to $15.00 (ii) the number of Common Warrants set forth opposite the name of such Investor under the heading “Number of Warrants” on Exhibit A attached
hereto, each with an exercise price equal to $18.10 per Common Warrant Share (subject to adjustment as provided therein), and (iii) the number of Pre-Funded Common Warrants set forth under the heading
“Number of Pre-Funded Common Warrants” on Exhibit A attached hereto, at a price per Pre-Funded Common Warrant equal to $14.99, each with an exercise
price equal to $0.01 per Pre-Funded Common Warrant Share (subject to adjustment as provided therein). 

3. Closing. 
 3.1. The
closing of the purchase and sale of the Closing Securities (which Closing Securities are set forth in the Schedule of Investors) pursuant to this Agreement (the “Closing”) shall be held remotely via the exchange of documents and
signatures no later than 10:00 AM (Eastern Time) on February 23, 2021 (the “Closing Date”). At or prior to the Closing, each Investor shall execute any related agreements or other documents required to be executed hereunder,
dated on or before the Closing Date, including but not limited to the Investor Questionnaire in the form attached hereto as Appendix I (the “Investor Questionnaire”). 

  
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 3.2. On the Closing Date, each Investor shall deliver or cause to be delivered to the
Company the Subscription Amount via wire transfer of immediately available funds pursuant to the wire instructions delivered to such Investor by the Company on or prior to the Closing Date. 

3.3. At or before the Closing, the Company shall deliver or cause to be delivered to each Investor (i) the number of Shares, registered
in the name of the Investor (or its nominee in accordance with its delivery instructions) in book entry form, in the amount set forth opposite the name of such Investor under the heading “Number of Shares” on Exhibit A attached
hereto (ii) the number of Common Warrants set forth opposite the name of such Investor under the heading “Number of Warrants” on Exhibit A attached hereto, registered in the name of the Investor and (iii) the number of Pre-Funded Common Warrants set forth opposite the name of such Investor under the heading “Number of Pre-Funded Common Warrants” on Exhibit A attached hereto,
registered in the name of the Investor. 
 4. Representations and Warranties of the Company. The Company hereby represents and
warrants to the Investors that, except as otherwise described in the SEC Filings, which qualify these representations and warranties in their entirety, as of the date hereof: 

4.1. Organization, Good Standing and Qualification. The Company is an entity duly incorporated, validly existing and in good standing
under the laws of the State of Delaware, with the requisite corporate power and authority to own or lease and use its properties and assets, to execute and deliver the Transaction Documents, to carry out the provisions of the Transaction Documents,
to issue and sell the Closing Securities and to carry on its business as presently conducted and as proposed to be conducted as described in the SEC Filings. Ayala-Oncology Israel Ltd. (the “Subsidiary”) is the only subsidiary of
the Company and is wholly owned by the Company. The Subsidiary is an entity duly incorporated or otherwise organized, validly existing and in good standing (to the extent such concept exists in the relevant jurisdiction) under the laws of the
jurisdiction of its incorporation or organization, as applicable, and has all requisite power and authority to carry on its business and to own and use its properties. Neither the Company nor its Subsidiary is in violation or default of any of the
provisions of its respective articles of association, charter, certificate of incorporation, bylaws, limited partnership agreement or other organizational or constitutive documents. Each of the Company and its Subsidiary is duly qualified to do
business as a foreign entity and is in good standing (to the extent such concept exists in the relevant jurisdiction) in each jurisdiction in which the conduct of its business or its ownership or leasing of property makes such qualification
necessary, except to the extent any failure to so qualify has not had and would not reasonably be expected to have a Material Adverse Effect. 

4.2. Authorization. The Company has the requisite corporate power and authority and has taken all requisite corporate action necessary
for, and no further action on the part of the Company, its officers, directors and stockholders is necessary for, (i) the authorization, execution and delivery of the Transaction Documents, (ii) the authorization of the

  
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performance of all obligations of the Company hereunder or thereunder, and (iii) the authorization, issuance (or reservation for issuance) and delivery of the Closing Securities. The
Company’s execution and delivery of each of the Transaction Documents and the consummation by it of the transactions contemplated hereby and thereby have been duly and validly authorized by all necessary board and stockholder action. Each of
the Transaction Documents has been duly executed and delivered by the Company and, assuming due authorization, execution and delivery by the Investors, constitutes valid and binding obligations of the Company enforceable in accordance with their
terms, except (a) as limited by applicable bankruptcy, insolvency, reorganization, moratorium or other laws of general application affecting enforcement of creditors’ rights, (b) general principles of equity that restrict the
availability of equitable remedies and (c) to the extent that the enforceability of indemnification provisions may be limited by applicable laws. 

4.3. Capitalization. The Company is authorized under its Certificate of Incorporation to issue 200,000,000 shares of Common Stock. The
Company’s disclosure of its issued and outstanding capital stock in its most recent SEC Filing containing such disclosure was accurate in all material respects as of the date indicated in such SEC Filing. Since the date indicated in such SEC
Filing, there has not been any change the Company’s capital stock, other than as a result of the exercise of stock options or the award of stock options or restricted stock units in the ordinary course of business pursuant to the Company’s
stock-based compensation plans described in the SEC Filings. All of the issued and outstanding shares of the Company’s capital stock have been duly authorized and validly issued and are fully paid, nonassessable and none of such shares were
issued in violation of any pre-emptive rights and such shares were issued in compliance in all material respects with applicable state and federal securities law and any rights of third parties. No Person is
entitled to pre-emptive or similar statutory or contractual rights with respect to the issuance by the Company of any securities of the Company. Except for stock options and restricted stock units approved
pursuant to Company stock-based compensation plans described in the SEC Filings and warrants described in the SEC Filings, there are no outstanding warrants, options, convertible securities or other rights, agreements or arrangements of any
character under which the Company is or may be obligated to issue any equity securities of any kind and except as contemplated by this Agreement. Except for the Amended and Restated Investors’ Rights Agreement, dated as of December 19,
2018, among the Company and the other parties thereto, as amended, there are no voting agreements, buy-sell agreements, option or right of first purchase agreements or other agreements of any kind among the
Company and any of the security holders of the Company relating to the securities of the Company held by them. Except as provided in the Amended and Restated Investors’ Rights Agreement, dated as of December 19, 2018, among the Company and
the other parties thereto, as amended, no Person has the right to require the Company to register any securities of the Company under the 1933 Act, whether on a demand basis or in connection with the registration of securities of the Company for its
own account or for the account of any other Person. The issuance and sale of the Closing Securities hereunder will not obligate the Company to issue shares of Common Stock or other securities to any other Person (other than the Investors) and will
not result in the adjustment of the exercise, conversion, exchange or reset price of any outstanding security. 

  
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 4.4. Valid Issuance. The Shares have been duly and validly authorized and, when
issued and paid for pursuant to this Agreement, will be validly issued, fully paid and nonassessable, and shall be free and clear of all encumbrances and restrictions (other than those waived or created by the Investors), except for restrictions on
transfer set forth in the Transaction Documents or imposed by applicable securities laws. The Warrants have been duly and validly authorized and, when issued and paid for pursuant to this Agreement, will be validly issued. The Warrant Shares have
been duly and validly authorized and reserved for issuance and, upon exercise of the Warrants in accordance with their terms, including the payment of any exercise price therefor, will be validly issued, fully paid and nonassessable and will be free
and clear of all encumbrances and restrictions (other than those created by the Investors), except for restrictions on transfer set forth in the Transaction Documents or imposed by applicable securities laws. Assuming the accuracy of the
representations and warranties of the Investors in this Agreement, the Closing Securities will be issued in compliance with all applicable federal and state securities laws. 

4.5. Consents. The execution, delivery and performance by the Company of the Transaction Documents and the offer, issuance and sale of
the Closing Securities require no consent of, action by or in respect of, or filing with, any Person, governmental body, agency, or official other than filings that have been made pursuant to applicable state securities laws and post-sale filings
pursuant to applicable state and federal securities laws and the rules and regulations of Nasdaq, which the Company undertakes to file within the applicable time periods, except as have already been made, obtained or waived or where the failure to
obtain any such approval, authorization, consent, order or filing would not impair the ability of the Company to issue and sell the Closing Securities or to consummate the transactions contemplated by this Agreement. 

4.6. No Material Adverse Change. Since September 30, 2020, except as specifically set forth in a subsequent SEC Filing, there has
not been: 
 (i) any change in the consolidated assets, liabilities, financial condition or operating results of the Company from that
reflected in the financial statements included in the Company’s Quarterly Report on Form 10-Q for the three months ended September 30, 2020, except for changes in the ordinary course of business
which have not had and would not reasonably be expected, individually or in the aggregate, to have a Material Adverse Effect; 
 (ii) any
declaration or payment by the Company of any dividend, or any authorization or payment by the Company of any distribution, on any of the capital stock of the Company, or any redemption or repurchase by the Company of any securities of the Company;

 (iii) any material damage, destruction or loss, whether or not covered by insurance, to any assets or properties of the Company; 

(iv) any waiver, not in the ordinary course of business, by the Company of a material right or of a material debt owed to it; 

  
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 (v) any satisfaction or discharge of a material lien, claim or encumbrance or payment of
any obligation by the Company, except in the ordinary course of business; 
 (vi) any change or amendment to the Company’s Certificate
of Incorporation or Bylaws, or termination of or material amendment to any contract of the Company that the Company is required to file with the SEC pursuant to Item 601(b)(10) of Regulation S-K; 

(vii) any material labor difficulties or, to the Company’s Knowledge, labor union organizing activities with respect to employees of the
Company; 
 (viii) any material transaction entered into by the Company other than in the ordinary course of business; 

(ix) the loss of the services of any executive officer (as defined in Rule 405 under the 1933 Act) of the Company; or 

(x) any other event or condition that, to the Company’s Knowledge, has had or would reasonably be expected to have a Material Adverse
Effect. 
 4.7. SEC Filings. The Company has filed all reports, schedules, forms, statements and other documents required to be filed
by the Company under the 1933 Act and the 1934 Act, including pursuant to Section 13(a) or 15(d) thereof, for the one year preceding the date hereof (or such shorter period as the Company was required by law or regulation to file
such material) (the “SEC Filings”). At the time of filing thereof, the SEC Filings complied as to form in all material respects with the requirements of the 1933 Act or 1934 Act, as applicable. 

4.8. No Conflict, Breach, Violation or Default. The execution, delivery and performance of the Transaction Documents by the Company and
the issuance and sale of the Closing Securities in accordance with the provisions thereof will not (i) conflict with or result in a breach or violation of (a) any of the terms and provisions of, or constitute a default under, the
Company’s Certificate of Incorporation or Bylaws, both as in effect on the date hereof (true and complete copies of which have been made available to the Investors through the EDGAR system), or (b) assuming the accuracy of the
representations and warranties in Section 5, any applicable statute, rule, regulation or order of any governmental agency or body or any court, domestic or foreign, having jurisdiction over the Company or its Subsidiary, or
any of their assets or properties, 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, encumbrance or other adverse claim upon
any of the properties or assets of the Company or its Subsidiary or give to others any rights of termination, amendment, acceleration or cancellation (with or without notice, lapse of time or both) of, any Material Contract except, in the case of
clauses (i)(b) and (ii) only, for such conflicts, breaches, violations and defaults as have not and would not reasonably be expected to have a Material Adverse Effect. This Section does not relate to matters with respect to tax status, which
are the subject of Section 4.10, employee relations and labor matters, which are the subject of Section 4.13, intellectual property, which are the subject of Section 4.14, and environmental laws, which are the subject of
Section 4.15. 

  
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 4.9. Compliance. The Company is not (i) 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 under), nor has the Company 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) in violation of any
judgment, decree or order of any court, arbitrator or governmental body or (iii) 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 environmental protection, occupational health and safety, product quality and safety and employment and labor matters, and excluding taxes, which are the subject of Section 4.10, except in each case as would not have or reasonably
be expected to result in a Material Adverse Effect. 
 4.10. Tax Matters. The Company and its Subsidiary have filed all tax returns
required to have been filed by them and have paid all taxes shown thereon or otherwise owed by them, other than (i) those taxes being contested in good faith and for which adequate reserves have been provided or (ii) where the failure to
so file or pay would not reasonably be expected to result in a Material Adverse Effect. The Company has made adequate charges, accruals and reserves in the applicable financial statements referred to in Section 4.17 below in respect of all
federal, state and foreign income and franchise taxes for all periods as to which the tax liability of the Company or its Subsidiary has not been finally determined, except to the extent of any inadequacy that would not reasonably be expected to
result in a Material Adverse Effect. There are no tax liens or claims pending or, to the Company’s Knowledge, threatened against the Company or its Subsidiary or any of their respective assets or property, which could reasonably be expected to
result in a Material Adverse Effect. 
 4.11. Title to Properties. The Company and its Subsidiary have good and marketable title to
all real properties and all other tangible properties and assets owned by them, in each case free from liens, encumbrances and defects, except such as would not reasonably be expected, individually or in the aggregate, to have a Material Adverse
Effect; and the Company and its Subsidiary hold any leased real or personal property under valid, subsisting and enforceable leases with which the Company and its Subsidiary are in compliance and with no exceptions, except such as would not
reasonably be expected, individually or in the aggregate, to have a Material Adverse Effect and except that the enforcement thereof may be subject to (i) bankruptcy, insolvency, reorganization, receivership, moratorium, fraudulent convenience
or other similar laws relating to creditor’s rights generally and (ii) general principles of equity and the discretion of the court before which any proceeding therefor may be brought. 

4.12. Certificates, Authorities and Permits. The Company and its Subsidiary possess adequate certificates, authorities or permits
issued by appropriate governmental agencies or bodies necessary to conduct the business now operated by them, except where failure to so possess would not reasonably be expected to, individually or in the aggregate, result in a Material Adverse
Effect. During the past three (3) years, the Company and its Subsidiary have not received any written notice of proceedings relating to the revocation or modification of any such certificate, authority or permit that, if determined adversely to
the Company or its Subsidiary, would reasonably be expected, individually or in the aggregate, to have a Material Adverse Effect. 

  
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 4.13. Labor Matters. 

(a) Neither the Company nor its Subsidiary are parties to or bound by any collective bargaining agreements or other agreements with labor
organizations. 
 (b) No labor dispute before the National Labor Relations Board with the employees of the Company or its Subsidiary, or
with the employees of any principal supplier, manufacturer, customer or contractor of the Company, exists or, to the Company’s Knowledge, is threatened or imminent that would reasonably be expected, individually or in the aggregate, to have a
Material Adverse Effect. 
 (c) There are no claims pending against the Company before the Equal Employment Opportunity Commission or any
other administrative body or in any court asserting any violation of Title VII of the Civil Rights Act of 1964, the Age Discrimination Act of 1967, 42 U.S.C. §§ 1981 or 1983 or any other federal, state or local law, statute or ordinance
barring discrimination of employment that would reasonably be expected, individually or in the aggregate, to have a Material Adverse Effect. 

4.14. Intellectual Property. Except as disclosed in the SEC Filings, and as would not reasonably be expected, individually or in the
aggregate, to have a Material Adverse Effect: the Company and its Subsidiary own, possess, license or have other rights to use, the patents and patent applications, copyrights, trademarks, service marks, trade names, service names and trade secrets
as necessary or material for use in connection with its businesses as described in the SEC Filings (collectively, the “Intellectual Property Rights”), and to the Company’s Knowledge, there are no material liens, security
interests or encumbrances that have been filed against any of these Intellectual Property Rights. No actions, suits, proceedings or claims are pending, or to the Company’s Knowledge, asserted or threatened against the Company or its Subsidiary
alleging infringement of a patent or other intellectual property right of others. To the Company’s Knowledge, there is no existing infringement by another Person of any of the Intellectual Property Rights that would materially affect the use
thereof by the Company. To the Company’s Knowledge, the development, manufacture, sale, and any currently proposed use of any of the products, proposed products or processes of the Company referred to in the SEC Filings, in the current or
proposed conduct of the business of the Company, do not currently, and will not upon commercialization, to the Company’s Knowledge, infringe any right or valid patent claim of any third party. To the Company’s Knowledge, there are no
ownership rights of third parties to any Intellectual Property Rights in any field of use that is exclusively licensed to the Company, other than any licensor to the Company of such Intellectual Property Rights. To the Company’s Knowledge, no
action, suit, claim or other proceeding, except for routine patent and trademark prosecution proceedings in patent offices throughout the world, is pending or threatened challenging the validity, enforceability, scope, registration, ownership or use
of any of the Intellectual Property Rights. To the Company’s Knowledge, no action, suit, claim or other proceeding is pending or threatened, challenging the Company’s rights in or to any Intellectual Property Rights. The Company and
its Subsidiary have security procedures designed to protect the secrecy, confidentiality and value of their Intellectual Property Rights. To the Company’s Knowledge, no employee is in or has been in violation in any material respect of any term
of any employment contract, invention assignment agreement, non-competition agreement, or nondisclosure agreement with a former employer, 

  
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executed prior to such employee’s employment where the basis of such violation relates to such employee’s employment and such violation occurred while employed and while the contract
was valid and in effect. All material licenses or other material agreements under which the Company is granted rights to Intellectual Property are, to the Company’s Knowledge, in full force and effect and, to the Company’s Knowledge, there
is no material default by any other party thereto. To the Company’s Knowledge, the licensors under material licenses and other material agreements had all requisite power and authority to grant the rights to the Intellectual Property Rights
purported to be granted thereby. To the Company’s Knowledge, the consummation of the transactions contemplated hereby and by the other Transaction Documents will not result in the alteration, loss, impairment of or restriction on the
Company’s or its Subsidiary’s ownership or right to use any Intellectual Property Rights that is material to the conduct of the Company’s business as now conducted. 

4.15. Environmental Matters. Except as would not reasonably be expected, individually or in the aggregate, to have a Material Adverse
Effect, neither the Company nor its Subsidiary is in violation of any statute, rule, regulation, decision or order of any governmental agency or body or any court, domestic or foreign, relating to the use, disposal or release of hazardous or toxic
substances or relating to the protection or restoration of the environment or human exposure to hazardous or toxic substances (collectively, “Environmental Laws”), has released any hazardous substances regulated by Environmental Law
on to any real property that it owns or operates, or has received any written notice or claim that it is liable for any off-site disposal or contamination pursuant to any Environmental Laws; and to the
Company’s Knowledge, there is no pending or threatened investigation that would reasonably be expected to lead to such a claim. 

4.16. Legal Proceedings. There are no legal, governmental or regulatory investigations, actions, suits or proceedings, to the
Company’s Knowledge, pending to which the Company or its Subsidiary is or may reasonably be expected to become a party or to which any property of the Company is or may reasonably be expected to become the subject that, individually or in the
aggregate, if determined adversely to the Company or its Subsidiary, would reasonably be expected to have a Material Adverse Effect. 

4.17. Financial Statements. The financial statements included in each SEC Filing comply in all material respects with applicable
accounting requirements and the rules and regulations of the SEC with respect thereto as in effect at the time of filing (or to the extent corrected by a subsequent restatement) and present fairly, in all material respects, the financial position of
the Company as of the dates shown and its results of operations and cash flows for the periods shown, subject in the case of unaudited financial statements to normal, immaterial year-end audit adjustments, and
such financial statements have been prepared in conformity with United States generally accepted accounting principles applied on a consistent basis during the periods involved (“GAAP”) (except as may be disclosed therein or in the
notes thereto, and except that the unaudited financial statements may not contain all footnotes required by GAAP, and, in the case of quarterly financial statements, as permitted by Form 10-Q under the 1934
Act). 

  
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 4.18. Insurance Coverage. The Company and its Subsidiary maintain insurance covering
their respective properties, operations, personnel and businesses as the Company reasonably deems adequate; the Company reasonably believes such insurance insures against such losses and risks in accordance with customary industry practice to
protect the Company and its Subsidiary and their respective businesses and which is commercially reasonable for the current conduct of their respective businesses; to the Company’s Knowledge, all such insurance is fully in force on the date
hereof. 
 4.19. Compliance with Nasdaq Continued Listing Requirements. The Company is in compliance with applicable Nasdaq continued
listing requirements. There are no proceedings pending or, to the Company’s Knowledge, threatened against the Company relating to the continued listing of the Common Stock on Nasdaq and the Company has not received any notice of, nor to the
Company’s Knowledge is there any reasonable basis for, the delisting of the Common Stock from Nasdaq. 
 4.20. Brokers and
Finders. Other than the Placement Agent, no Person will have, as a result of the transactions contemplated by the Transaction Documents, any valid right, interest or claim against or upon the Company or, to the Company’s Knowledge, an
Investor for any commission, fee or other compensation pursuant to any agreement, arrangement or understanding entered into by or on behalf of the Company. 

4.21. No Directed Selling Efforts or General Solicitation. Neither the Company nor its Subsidiary nor any Person acting on their behalf
has conducted any general solicitation or general advertising (as those terms are used in Regulation D) in connection with the offer or sale of any of the Closing Securities. 

4.22. No Integrated Offering. Neither the Company nor its Subsidiary nor any Person acting on their behalf has, directly or indirectly,
made any offers or sales of any Company security or solicited any offers to buy any Company security, under circumstances that would adversely affect reliance by the Company on Section 4(a)(2) for the exemption from registration for the
transactions contemplated hereby or would require registration of the Closing Securities under the 1933 Act. 
 4.23. Internal
Controls. The Company has established and maintains disclosure controls and procedures (as defined in Rules 13a-15(c) and 15d-15(e) of the 1934 Act) for the Company
and designed such disclosure controls and procedures to ensure that material information relating to the Company and required to be disclosed by the Company in the reports that it files or submits under the 1934 Act is made known to the certifying
officers by others within the Company. The Company maintains 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 and liability accountability, and (iii) access to assets or incurrence of liabilities
is permitted only in accordance with management’s general or specific authorization. The Company’s certifying officers have evaluated the effectiveness of the Company’s controls and procedures as of the end of the period covered by
the most recently filed periodic report under the 1934 Act (such date, the “Evaluation Date”). The Company presented in its most recently filed periodic report under the 1934 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 end of 

  
 12 

 
the Company’s most recent audited fiscal year, to the Company’s Knowledge, there have been no significant deficiencies or material weakness detected in the Company’s internal
control over financial reporting (whether or not remediated) and no change in the Company’s internal control over financial reporting that has materially affected, or is reasonably likely to materially affect, the Company’s internal
control over financial reporting. The Company is not aware of any change in its internal controls over financial reporting that has occurred during its most recent fiscal quarter that has materially affected, or is reasonably likely to materially
affect, the Company’s internal control over financial reporting. 
 4.24. Investment Company. The Company is not required to be
registered as, and immediately following the Closing will not be required to register as, an “investment company” within the meaning of the Investment Company Act of 1940, as amended. 

4.25. Tests and Preclinical and Clinical Trials. During the past three (3) years, the studies, tests and preclinical and clinical
trials conducted by or, to the Company’s Knowledge, on behalf of the Company were and, if still pending, are being, conducted in all material respects in accordance with all applicable Health Care Laws. The descriptions of the studies, tests
and preclinical and clinical trials conducted by or, to the Company’s Knowledge, on behalf of the Company, contained in the SEC Filings are accurate in all material respects; the Company is not aware of any other studies, tests or preclinical
and clinical trials, the results of which call into question the results described in the SEC Filings; and the Company has not received any written notices or correspondence from the U.S. Food and Drug Administration (the “FDA”),
any foreign, state or local governmental body exercising comparable authority or any Institutional Review Board requiring the termination, suspension or clinical hold of any studies, tests or preclinical or clinical trials conducted by or on behalf
of the Company. During the past three (3) years, neither the Company nor, to the Company’s Knowledge, any of its officers or employees has committed any act, made any statement or failed to make any statement that would reasonably be
expected to provide a basis for the FDA to invoke its policy with respect to “Fraud, Untrue Statements of Material Facts, Bribery, and Illegal Gratuities” set forth in 56 Fed. Reg. 46191 (Sept. 10, 1991) and any amendments thereto. During
the past three (3) years, neither the Company nor, to the Company’s Knowledge, any officer or employee of the Company has been convicted of any crime or engaged in any conduct that has resulted in or would reasonably be expected to result
in (i) debarment under 21 U.S.C. Section 335a or any similar state law or (ii) exclusion under 42 U.S.C. Section 1320a-7 or any similar state law or regulation. 

4.26. Manipulation of Price. The Company has not, and, to the Company’s Knowledge, no Person acting on its behalf has 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 Closing Securities. 

4.27. Bad Actor Disqualification. None of the Company, any predecessor or affiliated issuer of the Company nor, to the Company’s
Knowledge, any director or executive officer of the Company or any promoter connected with the Company in any capacity, is subject to any of the “bad actor” disqualifications within the meaning of Rule 506(d) under the 1933 Act, except for
a disqualification event covered by Rule 506(d)(2) or
 (d)(3). 

  
 13 

 4.28. Foreign Corrupt Practices; Questionable Payments. Neither the Company nor
its Subsidiary has, and to the Company’s Knowledge, no agent or other person acting on behalf of the Company or its 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 its Subsidiary (or made by any person acting on behalf of the Company or its Subsidiary of which the Company is aware) which is in violation of law, or (iv) violated in
any material respect any provision of the Foreign Corrupt Practices Act of 1977, as amended. 
 4.29. Takeover Protections; Rights
Agreements. The Company and the Board of Directors of the Company 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 charter documents or the laws of its state of incorporation that is or could reasonably be expected to become applicable to any of the Investors as a result of the
Investors and the Company fulfilling their obligations or exercising their rights under the Transaction Documents, including, without limitation, the Company’s issuance of the Closing Securities and the Investors’ ownership of the Closing
Securities. 
 5. Representations and Warranties of the Investors. Each of the Investors hereby, severally and not jointly,
represents and warrants to the Company that: 
 5.1. Organization and Existence. Such Investor is a validly existing corporation,
limited partnership or limited liability company and has all requisite corporate, partnership or limited liability company power and authority to enter into and consummate the transactions contemplated by the Transaction Documents and to carry out
its obligations hereunder and thereunder, and to invest in the Closing Securities pursuant to this Agreement. 
 5.2. Authorization.
The execution, delivery and performance by such Investor of the Transaction Documents to which such Investor is a party have been duly authorized and each has been duly executed and when delivered will constitute the valid and legally binding
obligation of such Investor, enforceable against such Investor in accordance with their respective 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. 
 5.3. Purchase Entirely for Own Account. The Closing Securities to be
received by such Investor hereunder will be acquired for such Investor’s own account, not as nominee or agent, and not with a view to the resale or distribution of any part thereof in violation of the 1933 Act, and such Investor has no present
intention of selling, granting any participation in, or otherwise distributing the same in violation of the 1933 Act without prejudice, however, to such Investor’s right at all times to sell or otherwise dispose of all or any part of such
Closing Securities in compliance with applicable federal and state securities laws. Nothing contained herein shall be deemed a representation or warranty by any Investor to hold the Closing Securities for any period of time. Such Investor is not a
broker-dealer registered with the SEC under the 1934 Act or an entity engaged in a business that would require it to be so registered. 

  
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 5.4. Investment Experience. Such Investor acknowledges that it can bear the economic
risk and complete loss of its investment in the Securities and has such knowledge and experience in financial or business matters that it is capable of evaluating the merits and risks of the investment contemplated hereby. 

5.5. Disclosure of Information. Such Investor has had an opportunity to receive, review and understand all information related to the
Company requested by it and to ask questions of and receive answers from the Company regarding the Company, its business and the terms and conditions of the offering of the Securities, and has conducted and completed its own independent due
diligence. Such Investor acknowledges receipt of copies of the SEC Filings. Based on the information such Investor has deemed appropriate, and without reliance upon the Placement Agent, it has independently made its own analysis and decision to
enter into the Transaction Documents. Such Investor is relying exclusively on its own sources of information, investment analysis and due diligence (including professional advice it deems appropriate) with respect to the execution, delivery and
performance of the Transaction Documents, the Securities and the business, condition (financial and otherwise), management, operations, properties and prospects of the Company, including but not limited to all business, legal, regulatory,
accounting, credit and tax matters. Neither such inquiries nor any other due diligence investigation conducted by such Investor shall modify, limit or otherwise affect such Investor’s right to rely on the Company’s representations and
warranties contained in this Agreement. 
 5.6. Restricted Securities. Such Investor understands that the Securities are
characterized as “restricted securities” under the U.S. federal securities laws inasmuch as they are being acquired from the Company in a transaction not involving a public offering and that under such laws and applicable regulations such
securities may be resold without registration under the 1933 Act only in certain limited circumstances. 
 5.7. Legends. It is
understood that, except as provided below, certificates or book entry positions evidencing the Securities may bear the following or any similar legend: 

“THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION OR THE SECURITIES COMMISSION OF
ANY STATE IN RELIANCE UPON AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND, ACCORDINGLY, MAY NOT BE TRANSFERRED UNLESS (I) SUCH SECURITIES HAVE BEEN REGISTERED FOR SALE PURSUANT TO THE SECURITIES ACT OF 1933, AS
AMENDED, (II) SUCH SECURITIES MAY BE SOLD PURSUANT TO RULE 144, OR (III) THE COMPANY HAS RECEIVED AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO IT THAT SUCH TRANSFER MAY LAWFULLY BE MADE WITHOUT REGISTRATION UNDER THE SECURITIES
ACT OF 1933, AS AMENDED. THESE SECURITIES 

  
 15 

 
ARE SUBJECT TO TRANSFER AND OTHER RESTRICTIONS SET FORTH IN A SECURITIES PURCHASE AGREEMENT, DATED FEBRUARY 19, 2021, COPIES OF WHICH ARE ON FILE WITH THE COMPANY. NOTWITHSTANDING THE
FOREGOING, THE SECURITIES MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT OR OTHER LOAN OR FINANCING ARRANGEMENT SECURED BY THE SECURITIES.” 

If required by the authorities of any state in connection with the issuance and sale of the Securities, the legend required by such state
authority. 
 5.8. Accredited Investor. At the time such Investor was offered the Closing Securities, it was and, as of the date
hereof, such Investor is an “accredited investor” within the meaning of Rule 501 under the 1933 Act and has executed and delivered to the Company its Investor Questionnaire, which such Investor represents and warrants is true, correct and
complete. Such Investor is a sophisticated institutional investor with sufficient knowledge, sophistication and experience in business, including transactions involving private investments in public equity, to properly evaluate the risks and merits
of its purchase of the Closing Securities. Such Investor has determined based on its own independent review and such professional advice as it deems appropriate that its purchase of the Securities and participation in the transactions contemplated
by the Transaction Documents (i) are fully consistent with its financial needs, objectives and condition, (ii) comply and are fully consistent with all investment policies, guidelines and other restrictions applicable to such Investor,
(iii) have been duly authorized and approved by all necessary action, (iv) do not and will not violate or constitute a default under such Investor’s charter, bylaws or other constituent document, if applicable, or under any law, rule,
regulation, agreement or other obligation by which such Investor is bound and (v) are a fit, proper and suitable investment for such Investor, notwithstanding the substantial risks inherent in investing in or holding the Securities. 

5.9. Placement Agent. Such Investor hereby acknowledges and agrees that it has independently evaluated the merits of its decision to
purchase the Closing Securities, and that (a) the Placement Agent is acting solely as placement agent in connection with the execution, delivery and performance of the Transaction Documents and is not acting as an underwriter or in any other
capacity and is not and shall not be construed as a fiduciary for such Investor, the Company or any other person or entity in connection with the execution, delivery and performance of the Transaction Documents, (b) the Placement Agent has not
made and will not make any representation or warranty, whether express or implied, of any kind or character and has not provided any advice or recommendation in connection with the execution, delivery and performance of the Transaction Documents,
(c) the Placement Agent will not have any responsibility with respect to (i) any representations, warranties or agreements made by any person or entity under or in connection with the execution, delivery and performance of the Transaction
Documents, or the execution, legality, validity or enforceability (with respect to any person) thereof, or (ii) the business, affairs, financial condition, operations, properties or prospects of, or any other matter concerning the Company and
(d) such Investor hereby waives any claims that it otherwise might assert against the Placement Agent in respect of the transactions contemplated by the Transaction Documents, absent gross negligence or willful misconduct on the part of the
Placement Agent. 

  
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 5.10. No General Solicitation. Such Investor did not learn of the investment in the
Shares as a result of any general or public solicitation or general advertising, or publicly disseminated advertisements or sales literature, including (a) any advertisement, article, notice or other communication published in any newspaper,
magazine, website, or similar media, or broadcast over television or radio, or (b) any seminar or meeting to which such Investor was invited by any of the foregoing means of communications. 

5.11. Brokers and Finders. No Person will have, as a result of the transactions contemplated by the Transaction Documents, any valid
right, interest or claim against or upon the Company or an Investor for any commission, fee or other compensation pursuant to any agreement, arrangement or understanding entered into by or on behalf of such Investor. 

5.12. Short Sales and Confidentiality Prior to the Date Hereof. Other than consummating the transactions contemplated hereunder, such
Investor has not, nor has any Person acting on behalf of or pursuant to any understanding with such Investor, 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 Investor was first contacted by the Company, the Placement Agent or any other Person regarding the transactions contemplated hereby and ending immediately prior to the date hereof. Notwithstanding the
foregoing, in the case of an Investor that is a multi-managed investment vehicle whereby separate portfolio managers manage separate portions of such Investor’s assets and the portfolio managers have no direct knowledge of the investment
decisions made by the portfolio managers managing other portions of such Investor’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. Such Investor, its Affiliates and, to the knowledge of such Investor, authorized representatives and advisors of such Investor who are aware of the transactions contemplated hereby,
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. 

5.13. No Government Recommendation or Approval. Such Investor understands that no United States federal or state agency, or similar
agency of any other country, has reviewed, approved, passed upon, or made any recommendation or endorsement of the Company or the purchase of the Securities. 

5.14. No Intent to Effect a Change of Control; Ownership. Such Investor has no present intent to effect a “change of control”
of the Company as such term is understood under the rules promulgated pursuant to Section 13(d) of the 1934 Act and under the rules of Nasdaq. 

5.15. No Conflicts. The execution, delivery and performance by such Investor of the Transaction Documents and the consummation by such
Investor of the transactions contemplated hereby and thereby will not (i) result in a violation of the organizational documents of such Investor or (ii) conflict with, or constitute a default (or an event which with notice or

  
 17 

 
lapse of time or both would become a default) under, or give to others any rights of termination, amendment, acceleration or cancellation of, any agreement, indenture or instrument to which such
Investor is a party, or (iii) result in a violation of any law, rule, regulation, order, judgment or decree (including federal and state securities laws) applicable to such Investor, except in the case of clauses (ii) and (iii) above, for
such conflicts, defaults, rights or violations which would not, individually or in the aggregate, reasonably be expected to have a material adverse effect on the ability of such Investor to perform its obligations hereunder. 

5.16. Residency. Such Investor’s office in which its investment decision with respect to the Closing Securities was made is
located at the address immediately below such Investor’s name on the Schedule of Investors. 
 5.17. ERISA. If Investor is
(1) an employee benefit plan subject to Title I of the Employee Retirement Income Security Act of 1974, as amended (“ERISA”), (2) a plan or account subject to Section 4975 of the Internal Revenue Code of 1986 (the
“Code”) or (3) an entity deemed to hold “plan assets” of any such plan or account, Investor hereby represents and warrants, solely for purposes of assisting the Placement Agent in relying on the exception from
fiduciary status under U.S. Department of Labor Regulations set forth in Section 29 CFR 2510.3-21(c)(1), that a fiduciary acting on its behalf is causing the Investor to enter into this Agreement and the
transactions contemplated hereby and that such fiduciary: 
 (a) is an entity specified in Section 29 CFR 2510.3-21(c)(1)(i)(A)-(E); 
 (b) is independent (for purposes of Section 29 CFR 2510.3-21(c)(1)) of the Placement Agent; 
 (c) is capable of evaluating investment risks independently,
both in general and with regard to particular transactions and investment strategies, including the Investor’s transaction hereunder; 

(d) has been advised that, with respect to the Placement Agent, neither the Placement Agent nor any of its affiliates has undertaken or will
undertake to provide impartial investment advice, or has given or will give advice in a fiduciary capacity, in connection with the Investor’s transactions contemplated hereby; 

(e) is a “fiduciary” under Section 3(21)(a) of ERISA or Section 4975(e)(3) of the Code, or both, as applicable, with
respect to, and is responsible for exercising independent judgment in evaluating, the Investor’s transactions contemplated hereby; and 

(f) understands and acknowledges that no fees, compensation arrangements or financial interests provided for in connection with the
transactions contemplated hereby is a fee or other compensation for the provision of investment advice, and that neither the Placement Agent nor any of its affiliates, nor any of their respective directors, officers, members, partners, employees,
principals or agents, has received or will receive a fee or other compensation from Investor or such fiduciary for the provision of investment advice in connection with the Investor’s transactions contemplated hereby. 

  
 18 

 6. Conditions to Closing. 

6.1. Conditions to the Investors’ Obligations. The obligation of each Investor to purchase Closing Securities at the Closing is
subject to the fulfillment to such Investor’s satisfaction, on or prior to the Closing Date, of the following conditions, any of which may be waived by such Investor (as to itself only): 

(a) The representations and warranties made by the Company in Section 4 hereof, as qualified by SEC Filings, shall be true and correct in
all material respects (except for those representations and warranties which are qualified as to materiality or by Material Adverse Effect, in which case such representations and warranties shall be true and correct in all respects) as of the date
hereof and on the Closing Date, except to the extent any such representation or warranty expressly speaks as of an earlier date, in which case such representation or warranty shall be true and correct as of such earlier date. The Company shall have
performed in all material respects all obligations and covenants herein required to be performed by it on or prior to the Closing Date. 

(b) The Company shall have obtained any and all consents, permits, approvals, registrations and waivers necessary for consummation of the
purchase and sale of the Closing Securities and the consummation of the other transactions contemplated by the Transaction Documents, all of which shall be in full force and effect. 

(c) The Company shall have filed with Nasdaq a Notification Form: Listing of Additional Shares for the Closing Securities. 

(d) No judgment, writ, order, injunction, award or decree of or by any court, or judge, justice or magistrate, including any bankruptcy court
or judge, or any order of or by any governmental authority, shall have been issued, and no action or proceeding shall have been instituted by any governmental authority, enjoining or preventing the consummation of the transactions contemplated
hereby or in the other Transaction Documents. 
 (e) The Investors shall have received an opinion from Latham & Watkins LLP, the
Company’s counsel, dated as of the Closing Date, in a customary form reasonably acceptable to the Investors. 
 (f) No stop order or
suspension of trading shall have been imposed by Nasdaq, the SEC or any other governmental or regulatory body with respect to public trading in the Common Stock. 

(g) The Company shall have delivered a certificate of the Secretary of the Company (the “Secretary’s Certificate”),
dated as of the Closing Date, (a) certifying the resolutions adopted by the Board of Directors of the Company or a duly authorized committee thereof approving the transactions contemplated by this Agreement and the other Transaction Documents
and the issuance of the Closing Securities, and (b) certifying the current versions of the Certificate of Incorporation and Bylaws of the Company. 

  
 19 

 6.2. Conditions to Obligations of the Company. The Company’s obligation to sell
and issue Closing Securities at the Closing is subject to the fulfillment to the satisfaction of the Company on or prior to the Closing Date of the following conditions, any of which may be waived by the Company: 

(a) The representations and warranties made by the Investors in Section 5 hereof shall be true and correct in all material respects
(except for those representations and warranties which are qualified as to materiality, in which case such representations and warranties shall be true and correct in all respects) when made, and shall be true and correct in all material respects
(except for those representations and warranties which are qualified as to materiality, in which case such representations and warranties shall be true and correct in all respects) on the Closing Date with the same force and effect as if they had
been made on and as of said date. The Investors shall have performed in all material respects all obligations and covenants herein required to be performed by them on or prior to the Closing Date. 

(b) Each Investor shall have executed and delivered the Investor Questionnaire. 

(c) Any Investor purchasing Closing Securities at the Closing shall have paid in full its Subscription Amount to the Company. 

6.3. Termination of Obligations to Effect Closing; Effects. 

(a) The obligations of the Company, on the one hand, and the Investors, on the other hand, to effect the Closing shall terminate as follows:

 (i) Upon the mutual written consent of the Company and Investors that agreed to purchase a majority of the Shares and the Warrant Shares
issuable upon exercise of the Warrants in the aggregate (the “Majority Investors”) to be issued and sold pursuant to this Agreement; 

(ii) By the Company if any of the conditions set forth in Section 6.2 shall have become incapable of fulfillment, and shall not have
been waived by the Company; or 
 (iii) By an Investor (with respect to itself only) if any of the conditions set forth in Section 6.1
shall have become incapable of fulfillment, and shall not have been waived by the Investor; 
 provided, however, that, except in the case of
clause (i) above, the party seeking to terminate its obligation to effect the Closing shall not then be in breach of any of its representations, warranties, covenants or agreements contained in this Agreement or the other Transaction Documents
if such breach has resulted in the circumstances giving rise to such party’s seeking to terminate its obligation to effect the Closing. 

(b) In the event of termination by the Company or any Investor of its obligations to effect the Closing pursuant to this
Section 6.3, written notice thereof shall be given to the other Investors by the Company and the other Investors shall have the right to terminate their obligations to effect the Closing upon written notice to the Company
and the other Investors. Nothing in this Section 6.3 shall be deemed to release any party from any liability for any breach by such party of the terms and provisions of this Agreement or the other Transaction Documents or
to impair the right of any party to compel specific performance by any other party of its obligations under this Agreement or the other Transaction Documents. 

  
 20 

 7. Covenants and Agreements of the Company. 

7.1. Nasdaq Listing. From the date hereof until such time as the Shares and Warrant Shares have been sold pursuant to Rule 144 or are
eligible for resale under Rule 144(b)(1) or any successor provision, the Company will use commercially reasonable efforts to continue the listing and trading of its Common Stock on Nasdaq and, in accordance, therewith, will use commercially
reasonable efforts to comply in all respects with the Company’s reporting, filing and other obligations under the bylaws or rules of such market or exchange, as applicable. 

7.2. Removal of Legends. In connection with any sale or disposition of the Shares or the Warrant Shares by an Investor pursuant to
Rule 144 or pursuant to any other exemption under the 1933 Act such that the purchaser acquires freely tradable shares and upon compliance by the Investor with the requirements of this Agreement, if requested by the Investor, the Company shall
use its reasonable best efforts to request that the transfer agent for the Common Stock (the “Transfer Agent”) remove any restrictive legends related to the book entry account holding such Shares or Warrant Shares and make a new,
unlegended entry for such book entry Shares or Warrant Shares sold or disposed of without restrictive legends within two (2) Trading Days of receipt of such request from the Investor, provided that the Company has received customary
representations and other documentation reasonably acceptable to the Company in connection therewith not later than 5:00 p.m. Eastern Time on the date of such request. Subject to receipt by the Company of customary representations and other
documentation reasonably acceptable to the Company in connection therewith, upon the earliest of such time as the Shares and Warrant Shares (i) have been sold or transferred pursuant to an effective registration statement, (ii) have been
sold pursuant to Rule 144 or (iii) are eligible for resale under Rule 144(b)(1) or any successor provision, the Company shall (A) deliver to the Transfer Agent irrevocable instructions that the Transfer Agent shall make a new,
unlegended entry for such book entry Shares or Warrant Shares, and (B) cause its counsel to deliver to the Transfer Agent one or more opinions to the effect that the removal of such legends in such circumstances may be effected under the 1933
Act. The Company shall be responsible for the fees of its Transfer Agent and all DTC fees associated with such issuance. 
 7.3. Transfer
Restrictions. Each Investor agrees that it will sell transfer or otherwise dispose of the Securities only in compliance with all applicable state and federal securities laws. 

7.4. Reservation of Common Stock. The Company shall take all action necessary to at all times have authorized, and reserved for the
purpose of issuance from and after the Closing Date, the number of shares of Common Stock issuable upon exercise of the Warrants issued at the Closing (without taking into account any limitations on exercise of the Warrants set forth therein). 

7.5. Fees. The Company shall be responsible for the payment of any placement agent fees, financial advisory fees, or broker’s
commissions (other than for Persons engaged by any Investor) relating to or arising out of the transactions contemplated hereby, including, without limitation, any fees or commissions payable to the Placement Agent. 

  
 21 

 7.6. Subsequent Equity Sales. The Company shall not, and shall use its commercially
reasonable efforts to ensure that no controlled Affiliate of the Company shall, sell, offer for sale or solicit offers to buy or otherwise negotiate in respect of any security (as defined in Section 2 of the 1933 Act) that will be integrated
with the offer or sale of the Shares in a manner that would require the registration under the 1933 Act of the sale of the Shares to the Investors. The Company shall not take any action or steps that would adversely affect reliance by the Company in
any material respect on Section 4(a)(2) for the exemption from registration for the transactions contemplated hereby or require registration of the Shares under the 1933 Act. 

7.7. Short Sales and Confidentiality After the Date Hereof. Each Investor covenants that neither it nor any Affiliates acting on its
behalf or pursuant to any understanding with it will execute any Short Sales during the period from the date hereof until the earlier of such time as (i) after the transactions contemplated by this Agreement are first publicly announced or
(ii) this Agreement is terminated in full. Each Investor covenants that until such time as the transactions contemplated by this Agreement are publicly disclosed by the Company, such Investor will maintain the confidentiality of all disclosures
made to it in connection with this transaction (including the existence and terms of this transaction). Each Investor understands and acknowledges that the SEC currently takes the position that coverage of short sales of shares of the Common Stock
“against the box” prior to effectiveness of a resale registration statement with securities included in such registration statement would be a violation of Section 5 of the 1933 Act, as set forth in Item 239.10 of the 1933 Act Rules
Compliance and Disclosure Interpretations compiled by the Office of Chief Counsel, Division of Corporation Finance. 
 7.8. Adjustments
in Share Numbers and Prices. In the event of any stock split, subdivision, dividend or distribution payable in shares of Common Stock (or other securities or rights convertible into, or entitling the holder thereof to receive directly or
indirectly shares of Common Stock), combination or other similar recapitalization or event occurring after the date hereof and prior to the Closing, each reference in any Transaction Document to a number of shares or a price per share shall be
deemed to be amended to appropriately account for such event. 
 7.9. Registration Rights and Rule 144. 

(a) The Company shall use its reasonable best efforts to register the resale by the Investors of the Registrable Securities on a registration
statement on Form S-3 (the “Registration Statement”) promptly following the date such form is available for use by the Company, but in no event later than June 15, 2021, and shall use its
reasonable best efforts to have the Registration Statement declared effective as soon as practicable, but in no event later than ten (10) Business Days after the SEC has notified that the Company that it will not review, or has completed its
review, of the Registration Statement. 

  
 22 

 (b) Notwithstanding anything to the contrary contained herein, the Company may, upon written
notice to any holder of Registrable Securities included in a Registration Statement, suspend the use of any Registration Statement, including any prospectus that forms a part of a Registration Statement, if the Company (X) determines that it
would be required to make disclosure of material information in the Registration Statement that the Company has a bona fide business purpose for preserving as confidential, (Y) the Company determines it must amend or supplement the Registration
Statement or the related prospectus so that such Registration Statement or prospectus shall not include an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements
therein, in the case of the prospectus in light of the circumstances under which they were made, not misleading or (Z) the Company has experienced or is experiencing some other material non-public event,
including a pending transaction involving the Company, the disclosure of which at such time, in the good faith judgment of the Company, would adversely affect the Company; provided, however, in no event shall holders of Registrable Securities be
suspended from selling Registrable Securities pursuant to the Registration Statement for a period that exceeds 30 consecutive Trading Days or 60 total Trading Days in any 360-day period. Upon disclosure of
such information or the termination of the condition described above, the Company shall provide prompt notice to holders whose Registrable Securities are included in the Registration Statement, and shall promptly terminate any suspension of sales it
has put into effect and shall take such other reasonable actions to permit registered sales of Registrable Securities as contemplated hereby. 

(c) With a view to making available to the Investors the benefits of Rule 144 (or its successor rule) and any other rule or regulation of
the SEC that may at any time permit the Investors to sell shares of Common Stock to the public without registration, the Company covenants and agrees to: (i) make and keep public information available, as those terms are understood and defined
in Rule 144, until the earlier of (A) six months after such date as all of the Registrable Securities may be sold without restriction by the holders thereof pursuant to Rule 144 or any other rule of similar effect or (B) such
date as there are no longer Registrable Securities; (ii) file with the SEC in a timely manner all reports and other documents required of the Company under the 1934 Act; and (iii) furnish electronically to each Investor upon request, as
long as such Investor owns any Registrable Securities, (A) a written statement by the Company that it has complied with the reporting requirements of the 1934 Act, (B) a copy of or electronic access to the Company’s most recent Annual
Report on Form 10-K or Quarterly Report on Form 10-Q, and (C) such other information as may be reasonably requested in order to avail such Investor of any rule or
regulation of the SEC that permits the selling of any such Registrable Securities without registration. 
 8. Survival and
Indemnification. 
 8.1. Survival. Subject to applicable statutes of limitations, the representations, warranties, covenants, and
agreements contained in this Agreement shall survive the Closing for a period of two (2) years after the date hereof and thereafter shall have no further force and effect. 

8.2. Indemnification by the Company. The Company agrees to indemnify and hold harmless each of the Investors, the officers, directors,
partners, members, and employees of each Investor, each Person who controls any such Investor (within the meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act) and the officers, directors, partners,

  
 23 

 
members and employees of each such controlling Person (each, an “Investor Indemnified Party”), against any losses, claims, damages, liabilities or expenses, joint or several, to
which such Investor Indemnified Party may become subject under the 1933 Act, the 1934 Act, or any other federal or state statutory law or regulation (including in settlement of any litigation, if such settlement is effected with the written consent
of the Company), insofar as such losses, claims, damages, liabilities or expenses (or actions in respect thereof as contemplated below) arise out of or are based in whole or in part on the inaccuracy in the representations and warranties of the
Company contained in this Agreement or the failure of the Company to perform its obligations hereunder, or arise out of or are based upon any untrue statement or alleged untrue statement or omission or alleged omission of any material fact contained
in any Registration Statement, any preliminary prospectus or final prospectus thereto, or any amendment or supplement thereof, and will reimburse each Investor Indemnified Party for legal and other expenses reasonably incurred as such expenses are
reasonably incurred by such Investor Indemnified Party in connection with investigating, defending, settling, compromising or paying such loss, claim, damage, liability, expense or action; provided, however, that the Company will not
be liable in any such case to the extent that any such loss, claim, damage, liability or expense arises out of or is based upon (i) the failure of such Investor Indemnified Party to comply with the covenants and agreements contained herein,
(ii) the inaccuracy of any representations made by such Investor Indemnified Party herein, (iii) an untrue statement or alleged untrue statement or omission or alleged omission so made in conformity with information furnished by an
Investor Indemnified Party in writing specifically for use in the Registration Statement or a prospectus, (iv) the use by an Investor Indemnified Party of an outdated or defective prospectus after the Company has notified such Investor in
writing that such prospectus is outdated or defective, or (v) an Investor Indemnified Party’s failure to send or give a copy of the prospectus or supplement (as then amended or supplemented), if required (and not exempted) to the persons
asserting an untrue statement or omission or alleged untrue statement or omission at or prior to the written confirmation of the sale of Registrable Securities. 

8.3. Indemnification by the Investors. Each Investor agrees, severally but not jointly, to indemnify and hold harmless, to the fullest
extent permitted by law, the Company, its directors, officers, employees, stockholders and each person who controls the Company (within the meaning of the 1933 Act) against any losses, claims, damages, liabilities and expense (including reasonable
attorney fees) resulting from any untrue statement of a material fact or any omission of a material fact required to be stated in the Registration Statement or prospectus or preliminary prospectus or amendment or supplement thereto or necessary to
make the statements therein not misleading, to the extent, but only to the extent, that such untrue statement or omission is contained in any information regarding such Investor and furnished in writing by such Investor to the Company specifically
for inclusion in the Registration Statement or prospectus or amendment or supplement thereto. In no event shall the liability of an Investor be greater than the dollar amount of the proceeds received by such Investor upon the sale of the Registrable
Securities included in such Registration Statement giving rise to such indemnification obligation. 
 8.4. Indemnification Procedure.
Promptly after any indemnified party hereunder (the “Indemnified Party”) has received notice of any indemnifiable claim hereunder, or the commencement of any action, suit or proceeding by a third Person, which the Indemnified Party
believes in good faith is an indemnifiable claim under this Agreement, the Indemnified 

  
 24 

 
Party shall give the indemnitor hereunder (the “Indemnifying Party”) written notice of such claim or the commencement of such action, suit or proceeding, but failure to so notify
the Indemnifying Party will not relieve the Indemnifying Party from any liability it may have to such Indemnified Party hereunder except to the extent that the Indemnifying Party is materially prejudiced by such failure. Such notice shall state the
nature and the basis of such claim to the extent then known. The Indemnifying Party shall have the right to defend and settle, at its own expense and by its own counsel who shall be reasonably acceptable to the Indemnified Party, any such matter as
long as the Indemnifying Party pursues the same diligently and in good faith. If the Indemnifying Party undertakes to defend or settle, it shall promptly notify the Indemnified Party of its intention to do so, and the Indemnified Party shall
cooperate with the Indemnifying Party and its counsel in all commercially reasonable respects in the defense thereof and the settlement thereof. Such cooperation shall include, but shall not be limited to, furnishing the Indemnifying Party with any
books, records and other information reasonably requested by the Indemnifying Party and in the Indemnified Party’s possession or control. Such cooperation of the Indemnified Party shall be at the cost of the Indemnifying Party. After the
Indemnifying Party has notified the Indemnified Party of its intention to undertake to defend or settle any such asserted liability, and for so long as the Indemnifying Party diligently pursues such defense, the Indemnifying Party shall not be
liable for any additional legal expenses incurred by the Indemnified Party in connection with any defense or settlement of such asserted liability; provided, however, that the Indemnified Party shall be entitled (a) at its expense, to
participate in the defense of such asserted liability and the negotiations of the settlement thereof and (b) if (i) the Indemnifying Party has failed to assume the defense or employ counsel reasonably acceptable to the Indemnified Party or
(ii) if the defendants in any such action include both the Indemnified Party and the Indemnifying Party and counsel to the Indemnified Party shall have concluded that there may be reasonable defenses available to the Indemnified Party that are
different from or in addition to those available to the Indemnifying Party or if the interests of the Indemnified Party reasonably may be deemed to conflict with the interests of the Indemnifying Party, then the Indemnified Party shall have the
right to select a separate counsel and to assume such legal defense and otherwise to participate in the defense of such action, with the expenses and fees of such separate counsel and other expenses related to such participation to be reimbursed by
the Indemnifying Party as incurred. Notwithstanding any other provision of this Agreement, the Indemnifying Party shall not settle any indemnified claim without the consent of the Indemnified Party, unless the settlement thereof imposes no liability
or obligation on, and includes a complete release from liability of, and does not include any admission of wrongdoing or malfeasance by, the Indemnified Party. 

9. Miscellaneous. 
 9.1.
Successors and Assigns. This Agreement may not be assigned by a party hereto without the prior written consent of the Company or the Investors, as applicable; provided, however, that an Investor may assign its rights and
delegate its duties hereunder in whole or in part to an Affiliate without the prior written consent of the Company or the other Investors, provided such assignee agrees in writing to be bound by the provisions hereof that apply to Investors. The
provisions of this Agreement shall inure to the benefit of and be binding upon the respective permitted successors and assigns of the parties. Without limiting the generality of the foregoing, in the event that the Company is a party to a merger,
consolidation, share exchange or similar business combination transaction in which the Common Stock is 

  
 25 

 
converted into the equity securities of another Person, from and after the effective time of such transaction, such Person shall, by virtue of such transaction, be deemed to have assumed the
obligations of the Company hereunder, the term “Company” shall be deemed to refer to such Person and the term “Securities” shall be deemed to refer to the securities received by the Investors in connection with such transaction.
Nothing in this Agreement, express or implied, is intended to confer upon any party other than the parties hereto or their respective permitted successors and assigns any rights, remedies, obligations, or liabilities under or by reason of this
Agreement, except as expressly provided in this Agreement. 
 9.2. Counterparts; E-mail. This
Agreement may be executed in one or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. Counterparts may be delivered via electronic mail (including pdf or any
electronic signature complying with the U.S. federal ESIGN Act of 2000, e.g., www.docusign.com) or other transmission method and any counterpart so delivered shall be deemed to have been duly and validly delivered and be valid and effective for all
purposes. 
 9.3. Titles and Subtitles. The titles and subtitles used in this Agreement are used for convenience only and are not to
be considered in construing or interpreting this Agreement. 
 9.4. Notices. All notices and other communications given or made
pursuant to this Agreement shall be in writing and shall be deemed effectively given upon the earlier of actual receipt, or (a) personal delivery to the party to be notified, (b) when sent, if sent by electronic mail during normal business
hours of the recipient, and if not sent during normal business hours, then on the recipient’s next business day, (c) two Business Days after having been sent by registered or certified mail, return receipt requested, postage prepaid, or
(d) one Business Day after deposit with a nationally recognized overnight courier, freight prepaid, specifying next business day delivery, with written verification of receipt. All communications shall be sent to the respective parties at their
electronic mail address or address as set forth below, or to such electronic mail address or address as subsequently modified by written notice given in accordance with this Section 9.4. 

If to the Company: 
 Ayala
Pharmaceuticals, Inc. 
 2 Oppenheimer Street 

Rehovot, Israel 7670110 

Attention: Chief Financial Officer 

Email: [XXX] 
 With a copy
(which will not constitute notice) to: 
 Latham & Watkins LLP 

200 Clarendon Street 
 Boston,
MA 02116 
 Facsimile: (617) 948-6001 

Attention: Peter N. Handrinos and Keith L. Halverstam 

Email: peter.handrinos@lw.com, keith.halverstam@lw.com 

  
 26 

 If to the Investors: 

to the contact information set forth on the signature pages hereto. 

9.5. Expenses. The parties hereto shall pay their own costs and expenses in connection herewith regardless of whether the transactions
contemplated hereby are consummated; it being understood that each of the Company and each Investor has relied on the advice of its own respective counsel. The Company shall pay any Transfer Agent fees, stamp taxes and other taxes and duties levied
in connection with the sale and issuance of the Closing Securities to the Investors. 
 9.6. Amendments and Waivers. Any term of this
Agreement may be amended and the observance of any term of this Agreement may be waived (either generally or in a particular instance and either retroactively or prospectively), only with the written consent of the Company and (a) prior to the
Closing, the Majority Investors and (b) following the Closing, Investors holding a majority of the Shares issued and sold pursuant to this Agreement and the Warrant Shares issuable upon exercise of the Warrants issued and sold pursuant to this
Agreement that are then-held by such Investors. Notwithstanding the foregoing, this Agreement may not be amended and the observance of any term of this Agreement may not be waived with respect to any Investor without the written consent of such
Investor unless such amendment or waiver applies to all Investors in the same fashion. Any amendment or waiver effected in accordance with this paragraph shall be binding upon (i) prior to Closing, each Investor and (ii) following the
Closing, each holder of any Closing Securities purchased under this Agreement or Warrant Shares at the time outstanding, and in each case, each future holder of all such Securities and the Company. 

9.7. Publicity. Except as set forth below, no public release or announcement concerning the transactions contemplated hereby shall be
issued by the Company or the Investors without the prior written consent of the Company (in the case of a release or announcement by the Investors) or the Investors (in the case of a release or announcement by the Company) (which consents shall not
be unreasonably withheld), except as such release or announcement may be required by law or the applicable rules or regulations of any securities exchange or securities market, in which case the Company or the Investors, as the case may be, shall
allow the Investors or the Company, as applicable, to the extent reasonably practicable in the circumstances, reasonable time to comment on such release or announcement in advance of such issuance. No later than the Trading Day immediately following
the date of this Agreement, the Company shall issue a press release disclosing all material terms of transactions contemplated by this Agreement (the “Press Release”) and any other material, nonpublic information that the Company
may have provided to any Investor in connection with the transactions contemplated by this Agreement. The Company shall not include the name of any Investor or any Affiliate in the Press Release or any other public announcement without the prior
written consent of such Investor. The Company shall not, and shall cause each of its officers, directors, employees and agents not to, provide any Investor with any material nonpublic information regarding the Company from and after the filing of
the Press Release without the express prior written consent of such Investor. 

  
 27 

 9.8. Severability. Any provision of this Agreement that is prohibited or
unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions hereof but shall be interpreted as if it were written so as to be
enforceable to the maximum extent permitted by applicable law, and any such prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction. To the extent permitted by
applicable law, the parties hereby waive any provision of law which renders any provision hereof prohibited or unenforceable in any respect. 

9.9. No Third-Party Beneficiaries. The Placement Agent shall be a third party beneficiary of the representations and warranties of the
Company in Section 4 hereof and with respect to the representations and warranties of the Investors in Section 5 hereof. 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 8 and this
Section 9.9. 
 9.10. Entire Agreement. This Agreement, including the signature pages, exhibits, the other
Transaction Documents and any oral or written agreement between the Company and any Investor regarding confidentiality matters that was entered into in connection with the transactions contemplated hereby constitute the entire agreement among the
parties hereof with respect to the subject matter hereof and thereof and supersede all prior agreements and understandings, both oral and written, between the parties with respect to the subject matter hereof and thereof. 

9.11. Further Assurances. The parties shall execute and deliver all such further instruments and documents and take all such other
actions as may reasonably be required to carry out the transactions contemplated hereby and to evidence the fulfillment of the agreements herein contained. 

9.12. Governing Law; Consent to Jurisdiction; Waiver of Jury Trial. This Agreement shall be governed by, and construed in accordance
with, the internal laws of the State of New York without regard to the choice of law principles thereof (other than Sections 5-1401 and 5-1402 of the General Obligations
Law). Each of the parties hereto irrevocably submits to the exclusive jurisdiction of the courts of the State of New York located in New York County and the United States District Court for the Southern District of New York for the purpose of any
suit, action, proceeding or judgment relating to or arising out of this Agreement and the transactions contemplated hereby. Service of process in connection with any such suit, action or proceeding may be served on each party hereto anywhere in the
world by the same methods as are specified for the giving of notices under this Agreement. Each of the parties hereto irrevocably consents to the jurisdiction of any such court in any such suit, action or proceeding and to the laying of venue in
such court. Each party hereto irrevocably waives any objection to the laying of venue of any such suit, action or proceeding brought in such courts and irrevocably waives any claim that any such suit, action or proceeding brought in any such court
has been brought in an inconvenient forum. EACH OF THE PARTIES HERETO WAIVES ANY RIGHT TO REQUEST A TRIAL BY JURY IN ANY LITIGATION WITH RESPECT TO THIS AGREEMENT AND REPRESENTS THAT COUNSEL HAS BEEN CONSULTED SPECIFICALLY AS TO THIS
WAIVER.  

  
 28 

 9.13. Independent Nature of Investors’ Obligations and Rights. The obligations
of each Investor under any Transaction Document are several and not joint with the obligations of any other Investor, and no Investor shall be responsible in any way for the performance of the obligations of any other Investor under any Transaction
Document. The decision of each Investor to purchase Closing Securities pursuant to the Transaction Documents has been made by such Investor independently of any other Investor. Nothing contained herein or in any Transaction Document, and no action
taken by any Investor pursuant thereto, shall be deemed to constitute the Investors as a partnership, an association, a joint venture or any other kind of entity, or create a presumption that the Investors 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 Investor acknowledges that no other Investor has acted as agent for such Investor in connection with making its investment hereunder and that
no Investor will be acting as agent of such Investor in connection with monitoring its investment in the Securities or enforcing its rights under the Transaction Documents. Each Investor 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 Investor to be joined as an additional party in any proceeding for such purpose.

 [remainder of page intentionally left blank] 

  
 29 

 IN WITNESS WHEREOF, the parties have executed this Agreement or caused their duly authorized
officers to execute this Agreement as of the date first above written. 
  

							
	COMPANY:	 		 	AYALA PHARMACEUTICALS, INC.
				
		 		 	By:	 	/s/ Yossi Maimon
		 		 		 	Name: Yossi Maimon
		 		 		 	Title: Chief Financial Officer

							
	INVESTOR:	 		 	 Redmile Capital Offshore II Master Fund Ltd.

(Strategic Sleeve)

				
		 		 	 By:
	 	Redmile Group, LLC, its investment manager
				
		 		 	By:	 	/s/ Joshua Garcia
		 		 		 	Name: Joshua Garcia
		 		 		 	Title: CFO

							
	INVESTOR:	 		 	Redmile Strategic Master Fund, LP
				
		 		 	 By:
	 	Redmile Group, LLC, its investment manager
				
		 		 	By:	 	/s/ Joshua Garcia
		 		 		 	Name: Joshua Garcia
		 		 		 	Title: CFO

							
	INVESTOR:	 		 	Sio Capital Management LLC
				
	 	 	 	 	By:	 	 /s/ Michael Castor

	 	 	 	 	 	 	Name: Michael Castor
	 	 	 	 	 	 	Title: Managing Member

 EXHIBIT A 

Schedule of Investors 
  

																	
	 Investor Name and Address
	  	Number of Shares	 	  	Number of
Pre-Funded
Common
Warrants	 	  	Number of
Common
Warrants	 	  	Aggregate Purchase
Price of Closing
Securities	 
	 Redmile Capital Offshore II Master Fund, Ltd. (Strategic Sleeve)

c/o Redmile Group, LLC

One Letterman Drive, Building D, Suite D3-300

The Presidio of San Francisco

San Francisco, CA 94129

Email: operations@redmilegrp.com
	  	 	—  	 	  	 	510,380	 	  	 	154,330	 	  	$	7,650,596.20	 
	 Redmile Strategic Master Fund, LP

c/o Redmile Group, LLC

One Letterman Drive, Building D, Suite D3-300

The Presidio of San Francisco

San Francisco, CA 94129

Email: operations@redmilegrp.com
	  	 	—  	 	  	 	822,953	 	  	 	312,336	 	  	$	12,336,065.47	 
	 Sio Capital Management LLC

600 Third Avenue

2nd Floor

New York, NY 10016

Email: judah.drillick@siocapital.com
	  	 	333,333	 	  	 	—  	 	  	 	116,666	 	  	$	4,999,995.00	 
		  	  
	  
	 	  	  
	  
	 	  	  
	  
	 	  	  
	  
	 
	 Total:
	  	 	333,333	 	  	 	1,333,333	 	  	 	583,332	 	  	$	24,986,656.67	 
		  	  
	  
	 	  	  
	  
	 	  	  
	  
	 	  	  
	  
	 

 EXHIBIT B-1 

Form of Common Warrant 

[See attached] 

[Intentionally Omitted] 

 EXHIBIT B-2 

Form of Pre-Funded Common Warrant 

[See attached] 

[Intentionally Omitted] 

 APPENDIX I 

Form of Investor Questionnaire 

[Intentionally Omitted]Exhibit 10.1

 

 

 

STOCK PURCHASE AGREEMENT

between

ALAN TSAI

and

CANNABIS GLOBAL, INC.

dated as of

February 16, 2021

 

 

 

 

 

    	  

    	 

    

STOCK PURCHASE AGREEMENT

This
Stock Purchase Agreement (this “Agreement”), dated as of February 16, 2021, is entered into between Alan Tsai,
an individual (“Tsai”), and Cannabis Global, Inc., a Nevada corporation (“CGI”). Capitalized
terms used in this Agreement have the meanings given to such terms herein.

RECITALS

WHEREAS,
Tsai owns that number of issued and outstanding shares of common stock, no par value (the “Shares”), of Natural
Plant Extract of California, Inc., a California corporation (the “Company”), as set forth on Schedule 1
hereto (the “Shares”);

WHEREAS,
the Company operates a licensed psychoactive cannabis manufacturing and distribution business operation out of Lynwood, California;

WHEREAS,
CGI is an issuer with a class of shares registered pursuant to Section 12(g) of the Securities
Exchange Act of 1934, as amended (the “1934 Act”), and whose shares are publicly traded through the
OTC Markets under the ticker symbol CBGL; and

WHEREAS,
Tsai wishes to sell to CGI, and CGI wishes to purchase from Tsai, the Shares, subject to the terms and conditions set forth herein.

NOW,
THEREFORE, in consideration of the mutual covenants and agreements hereinafter set forth and for other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:

ARTICLE
I

Purchase and sale

Section
1.01       Purchase and Sale. Subject to the terms and conditions
set forth herein, at the Closing (as defined in Section 2.01), Tsai shall sell to CGI, and CGI shall purchase from Tsai, the Shares,
free and clear of any mortgage, pledge, lien, charge, security interest, claim, community property interest, option, equitable
interest, restriction of any kind (including any restriction on use, voting, transfer, receipt of income, or exercise of any other
ownership attribute), or other encumbrance (each, an “Encumbrance”), for the consideration specified in Section
1.02.

Section
1.02       Purchase Price. The aggregate purchase price
for the Shares shall be that number of shares of restricted common stock of CGI (the “CGI Shares”) equal to
$300,000 plus indemnification by CGI of Tsai for any claims that currently exist and/or may arise from the liabilities related
to the Company as listed on Schedule 1.02 of this Agreement (collectively, the “Purchase Price”).
For purposes of determining the number of CGI Shares equal to the Purchase Price, the valuation of the CGI Shares shall be determined
based on the average daily trading price for the ten (10) trading days immediately preceding the Closing.

    	1  

    	 

    

ARTICLE
II

CLOSING

Section 2.01      
Closing. The
closing of the transactions contemplated by this Agreement (the “Closing”) shall take place simultaneously with
the execution of this Agreement on the date of this Agreement (the “Closing Date”), such Closing to take place
electronically, or such other place or manner as the parties may mutually agree. The consummation of the transactions contemplated
by this Agreement shall be deemed to occur at 12:01 a.m. PST on the Closing Date.

Section 2.02      
Tsai Closing Deliverables.
At the Closing, Tsai shall deliver to CGI the following:

(a)              
Share certificates evidencing the Shares, free and clear of all Encumbrances, duly endorsed in blank, stock powers or
other instruments of transfer duly executed in blank.

Section 2.03      
CGI’s Deliveries.
At the Closing, CGI shall deliver the following to Tsai:

(a)              
The Purchase Price paid in the form of the CGI Shares, as contemplated by Section 1.02, either in certificated or electronic
form.

(b)             
A certificate of the Secretary (or other officer) of CGI certifying that attached thereto are true and complete copies
of all resolutions of the board of directors of CGI authorizing the execution, delivery, and performance of this Agreement and
the Transaction Documents and the consummation of the transactions contemplated hereby and thereby, and that such resolutions are
in full force and effectts.

ARTICLE
III

Representations and warranties of Tsai

Tsai represents and warrants to CGI
that the statements contained in this Article III are true and correct as of the date hereof. For purposes of this Article III,
“Tsai’s knowledge,” “knowledge of Tsai,” and any similar phrases shall mean the actual or constructive
knowledge of Tsai, after due inquiry.

Section
3.01       Organization and Authority of Tsai. Tsai
is an individual with full power, capacity and authority to enter into this Agreement and the other Transaction Documents to which
Tsai is a party, to carry out its obligations hereunder and thereunder, and to consummate the transactions contemplated hereby
and thereby. This Agreement and each Transaction Document constitute legal, valid, and binding obligations of Tsai enforceable
against Tsai in accordance with their respective terms.

    	2  

    	 

    

 

Section
3.02       No Conflicts or Consents. The execution,
delivery, and performance by Tsai of this Agreement and the other Transaction Documents to which it is a party, and the consummation
of the transactions contemplated hereby and thereby, do not and will not: (a) violate or conflict with any provision of any
statute, law, ordinance, regulation, rule, code, treaty, or other requirement of any Governmental Authority (collectively, “Law”)
or any order, writ, judgment, injunction, decree, determination, penalty, or award entered by or with any governmental authority
(“Governmental Order”) applicable to Tsai; (b) except with respect to State of California cannabis laws, rules
and regulations, require the consent, notice, or filing with or other action by any Person or require any permit or license under
applicable Law (“Permit”) or Governmental Order; or (c) violate or conflict with, result in the acceleration
of, or create in any party the right to accelerate, terminate, or modify any contract, lease, deed, mortgage, license, instrument,
note, indenture, joint venture, or any other agreement, commitment, or legally binding arrangement, whether written or oral, to
which Tsai is a party or by which Tsai is bound or to which any of their respective properties and assets are subject, except with
respect to the transfer restrictions and rights of first refusal binding the Shares set forth in that certain Shareholders Agreement
(as defined in Section 7.02 below).

Section
3.03        Title to the Shares by Tsai. Tsai owns
of record and beneficially all of the Shares set forth next to their name on Schedule 1 hereto and Tsai has good and marketable
title to the Shares, in each case free and clear of all Encumbrances. There are no outstanding or authorized options, warrants,
agreements, commitments, convertible securities, stock appreciation, phantom stock, profit participation, or other rights, obligating
Tsai to issue or sell any of the Shares, or any other capital stock of, or any other interest in, the Company.

Section 3.04      
No Litigation. There are no claims, actions, causes of action, demands, lawsuits, arbitrations, inquiries, audits, notices
of violation, proceedings, litigation, citations, summons, subpoenas, or investigations of any nature, whether at law or in equity
pending or, to Tsai’s knowledge, threatened against or by Tsai that challenge or seek to prevent, enjoin, or otherwise delay
the transactions contemplated by this Agreement. To Tsai’s knowledge, no event has occurred that may be reasonably expected
to give rise to any such Action.

Section 3.05      
No Brokers of Tsai. No broker, finder, or investment banker is entitled to any brokerage, finder’s, or other fee
or commission in connection with the transactions contemplated by this Agreement or any other Transaction Document based upon arrangements
made by or on behalf of Tsai.

Section
3.06       Investment Purpose. Tsai is acquiring the
CGI Shares solely for its own account for investment purposes and not with a view to, or for offer or sale in connection with,
any distribution thereof or any other security related thereto within the meaning of the Securities Act of 1933, as amended (the
“Securities Act”). Tsai acknowledges that the offer and sale of the CGI Shares are not registered under the
Securities Act or any state securities laws, and that the Shares may not be pledged, transferred, sold, offered for sale, hypothecated,
or otherwise disposed of except pursuant to the registration provisions of the Securities Act or pursuant to an applicable exemption
therefrom and subject to state securities laws and regulations, as applicable.

Section 3.07      
Restricted Securities. Tsai understands that the CGI Shares have not been, and will not be, registered under the Securities
Act, by reason of a specific exemption from the registration provisions of the Securities Act which depends upon, among other things,
the bona fide nature of the investment intent and the accuracy of Tsai’s representations as expressed herein. Tsai understands
that the CGI Shares are “restricted securities” under applicable United States federal and state securities laws and
that, pursuant to these laws, Tsai must hold the CGI Shares indefinitely unless they are registered with the Securities and Exchange
Commission and qualified by state authorities or an exemption from such registration and qualification requirements is available.
Tsai acknowledges that CGI has no obligation to register or qualify the CGI Shares for resale. Tsai further acknowledges that if
an exemption from registration or qualification is available, it may be conditioned on various requirements including, but not
limited to, the time and manner of sale, the holding period for the CGI Shares, and on requirements relating to CGI which are outside
of Tsai’s control, and which CGI is under no obligation and may not be able to satisfy.

    	3  

    	 

    

 

Section 3.08      
Accredited and Sophisticated Purchaser. Tsai is an accredited investor as defined in Rule 501(a) of Regulation D promulgated
under the Securities Act. Tsai is an investor in securities of companies in the development stage and acknowledges that Tsai is
able to fend for itself, can bear the economic risk of its investment, and has such knowledge and experience in financial or business
matters that it is capable of evaluating the merits and risks of the investment in the CGI Shares. If other than an individual,
Tsai also represents it has not been organized for the purpose of acquiring the CGI Shares.

Section 3.09      
No General Solicitation. Neither Tsai nor any of his agents or partners has either directly or indirectly, including
through a broker or finder (a) engaged in any general solicitation with respect to the offer and sale of the CGI Shares, or
(b) published any advertisement in connection with the offer and sale of the CGI Shares.

ARTICLE
IV

Representations and warranties of CGI

CGI represents and warrants to Tsai
that the statements contained in this Article IV are true and correct as of the date hereof. For purposes of this Article IV, “CGI’s
knowledge,” “knowledge of CGI,” and any similar phrases shall mean the actual or constructive knowledge of any
director or officer of CGI, after due inquiry.

Section 4.01      
Organization and
Authority of CGI. CGI is a corporation duly organized, validly existing, and in good standing under the Laws of the
state of Nevada. CGI has full corporate power and authority to enter into this Agreement and the other Transaction Documents to
which CGI is a party, to carry out its obligations hereunder and thereunder, and to consummate the transactions contemplated hereby
and thereby. The execution and delivery by CGI of this Agreement and any other Transaction Document to which CGI is a party, the
performance by CGI of its obligations hereunder and thereunder, and the consummation by CGI of the transactions contemplated hereby
and thereby have been duly authorized by all requisite corporate action on the part of CGI. This Agreement and each Transaction
Document constitute legal, valid, and binding obligations of CGI enforceable against CGI in accordance with their respective terms.

Section 4.02      
Valid Issuance of
CGI Shares. The CGI Shares, when issued, sold and delivered in accordance with the terms and for the consideration set
forth in this Agreement, will be duly authorized, validly issued, fully paid and nonassessable and free of restrictions on transfer
other than restrictions on transfer under this Agreement, applicable state and federal securities laws and liens or encumbrances
created by or imposed by Tsai. Based in part on the accuracy of the representations of Tsai in Article 3 of this Agreement
and applicable federal and state securities laws, the offer, sale and issuance of the CGI Shares to be issued pursuant to and in
conformity with the terms of this Agreement will be issued in compliance with all applicable federal and state securities laws.

Section
4.03       No Conflicts; Consents. The execution,
delivery, and performance by CGI of this Agreement and the other Transaction Documents to which it is a party, and the consummation
of the transactions contemplated hereby and thereby, do not and will not: (a) violate or conflict with any provision of the articles
of incorporation, bylaws, or other governing documents of CGI; (b) violate or conflict with any provision of any Law or Governmental
Order applicable to CGI; or (c) require the consent, notice, declaration, or filing with or other action by any Person or require
any Permit or Governmental Order.

    	4  

    	 

    

 

Section
4.04       Investment Purpose. CGI is acquiring the
Shares solely for its own account for investment purposes and not with a view to, or for offer or sale in connection with, any
distribution thereof or any other security related thereto within the meaning of the Securities Act. CGI acknowledges that the
offer and sale of the Shares are not registered under the Securities Act or any state securities laws, and that the Shares may
not be pledged, transferred, sold, offered for sale, hypothecated, or otherwise disposed of except pursuant to the registration
provisions of the Securities Act or pursuant to an applicable exemption therefrom and subject to state securities laws and regulations,
as applicable.

Section 4.05      
Brokers.
No broker, finder, or investment banker is entitled to any brokerage, finder’s, or other fee or commission in connection
with the transactions contemplated by this Agreement or any other Transaction Document based upon arrangements made by or on behalf
of CGI.

ARTICLE
V

Covenants

Section 5.01      
Confidentiality.
From and after the Closing, Tsai shall, and shall cause its Affiliates and its and their respective directors, managers, officers,
employees, consultants, counsel, accountants, and other agents (“Representatives”) to hold, in confidence any
and all information, in any form, concerning the Company, except to the extent that Tsai can show that such information: (a) is
generally available to and known by the public through no fault of Tsai, any of its Affiliates, or their respective Representatives;
or (b) is lawfully acquired by Tsai, any of its Affiliates, or their respective Representatives from and after the Closing from
sources which are not prohibited from disclosing such information by any obligation. If Tsai or any of its Affiliates or their
respective Representatives are compelled to disclose any information by Governmental Order or Law, Tsai shall promptly notify CGI
in writing and shall disclose only that portion of such information which is legally required to be disclosed. Tsai shall use reasonable
best efforts to obtain as promptly as possible an appropriate protective order or other reasonable assurance that confidential
treatment will be accorded such information.

    	5  

    	 

    

 

Section
5.02       Indemnification of Tsai as Prior Officer
and Director of the Company. Tsai, as a former officer and a director of the Company, has certain rights to indemnification,
advancement of expenses and exculpation by the Company as provided in the certificate of incorporation or by-laws of the Company,
in each case as in effect on the date of this Agreement (the “D&O Indemnification Rights”). CGI agrees that
it shall vote the Shares, and any other shares of the Company it holds, and shall cause its appointees to the Company board of
directors to vote, so as to maintain in full force and effect the D&O Indemnification Rights in accordance with their respective
terms as of the date hereof.

Section
5.03          Buy-Back Option. For
the three-month period following the one-year anniversary of the Closing Date, Tsai shall have the sole and irrevocable option
to require CGI to repurchase the CGI Shares from Tsai (the "Buy-Back Option"). To exercise the Buy-Back Option, Tsai
shall provide written notice to CGI to that effect (the "Buy-Back Option Notice"). No later than fifteen (15) business
days after receipt of the Buy-Back Option Notice from Tsai, CGI shall issue payment to Tsai for the CGI Shares in accordance with
the following:

(a)              
If the value of the CGI Shares on the date of the Buy-Back Option Notice was less than $150,000, the payment for the CGI
Shares shall be $150,000;

(b)              
If the value of the CGI Shares on the date of the Buy-Back Option Notice exceeded $150,000, the payment for the CGI Shares
shall be the market value of the CGI Shares as of the date of the Buy-Back Option Notice. 

 

In
determining the value of the CGI Shares for all purposes under this Section 5.03, the parties shall use the trading price of CGI’s
common stock on the date of the Buy-Back Option Notice.

Section
5.04       Further Assurances. Following the Closing,
each of the parties hereto shall, and shall cause their respective Affiliates to, execute and deliver such additional documents
and instruments and take such further actions as may be reasonably required to carry out the provisions hereof and give effect
to the transactions contemplated by this Agreement and the other Transaction Documents.

ARTICLE
VI

Indemnification

Section
6.01       Indemnification by Tsai. Subject to the
other terms and conditions of this Article VII, Tsai shall indemnify and defend each of CGI and its Affiliates (including the Company)
and their respective Representatives (collectively, the “CGI Indemnitees”) against, and shall hold each of them
harmless from and against, and shall pay and reimburse each of them for, any and all Losses incurred or sustained by, or imposed
upon, CGI Indemnitees based upon, arising out of, with respect to, or by reason of:

(a)              
any inaccuracy in or breach of any of the representations or warranties of Tsai contained in this Agreement or the other
Transaction Documents; or

(b)             
any breach or non-fulfillment of any covenant, agreement, or obligation to be performed by Tsai pursuant to this Agreement
or the other Transaction Documents.

    	6  

    	 

    

 

Section
6.02       Indemnification by CGI. Subject to the
other terms and conditions of this Article VII, CGI shall indemnify and defend each of Tsai and its Affiliates and their respective
Representatives (collectively, the “Tsai Indemnitees”) against, and shall hold each of them harmless from and
against, and shall pay and reimburse each of them for, any and all Losses incurred or sustained by, or imposed upon, Tsai Indemnitees
based upon, arising out of, with respect to, or by reason of:

(a)              
any inaccuracy in or breach of any of the representations or warranties of CGI contained in this Agreement or the other
Transaction Documents;

(b)             
the liabilities listed on Schedule 1.02 up to the corresponding amounts reflected on such schedule; or

(c)              
any other breach or non-fulfillment of any covenant, agreement, or obligation to be performed by CGI pursuant to this
Agreement.

Section 6.03      
Indemnification
Procedures. Whenever any claim shall arise for indemnification hereunder, the party entitled to indemnification (the
“Indemnified Party”) shall promptly provide written notice of such claim to the other party (the “Indemnifying
Party”). In connection with any claim giving rise to indemnity hereunder resulting from or arising out of any Action
by a Person who is not a party to this Agreement, the Indemnifying Party, at its sole cost and expense and upon written notice
to the Indemnified Party, may assume the defense of any such Action with counsel reasonably satisfactory to the Indemnified Party.
The Indemnified Party shall be entitled to participate in the defense of any such Action, with its counsel and at its own cost
and expense. If the Indemnifying Party does not assume the defense of any such Action, the Indemnified Party may, but shall not
be obligated to, defend against such Action in such manner as it may deem appropriate, including settling such Action, after giving
notice of it to the Indemnifying Party, on such terms as the Indemnified Party may deem appropriate and no action taken by the
Indemnified Party in accordance with such defense and settlement shall relieve the Indemnifying Party of its indemnification obligations
herein provided with respect to any damages resulting therefrom. The Indemnifying Party shall not settle any Action without the
Indemnified Party’s prior written consent (which consent shall not be unreasonably withheld or delayed).

Section 6.04      
Survival.
All representations, warranties, covenants, and agreements contained herein and all related rights to indemnification shall survive
the Closing and shall remain in full force and effect until the date that is two years from the Closing Date; provided, that the
representations and warranties in Sections 3.01, 3.03, 3.05, 4.01, 4.02 and 4.05 shall survive for the applicable statute of limitations.
All covenants and agreements of the parties contained herein shall survive the Closing indefinitely or for the period explicitly
specified therein. Notwithstanding the foregoing, any claims which are timely asserted in good faith with reasonable specificity
(to the extent known at such time) and in writing by notice from the non-breaching party to the breaching party prior to the expiration
date of the applicable survival period shall not thereafter be barred by the expiration of the relevant representation or warranty
and such claims shall survive until finally resolved.

    	7  

    	 

    

 

Section
6.05       Cumulative Remedies. The rights and remedies
provided for in this Article VI are cumulative and are in addition to and not in substitution for any other rights and remedies
available at Law or in equity or otherwise.

ARTICLE
VII

Miscellaneous

Section
7.01       Mutual Release.

(a)              
Effective as of the date hereof and in consideration for the Purchase Price paid to
Tsai under the Agreement, and other good and valuable consideration, and were expressly bargained for, including without limitation
the waiver of the provisions of California Civil Code Section 1542, Tsai, on behalf of itself and each of Tsai’s Affiliates,
agents, attorneys, representatives, successors, assigns and heirs (together with Tsai, each a “Tsai Releasing Party”
and collectively, the “Tsai Releasing Parties”), hereby, irrevocably
and unconditionally, fully and forever acquits, releases, covenants not to sue, and discharges and agrees to hold harmless the
Company and its Affiliates, officers, managers, directors, shareholders, members, partners, employees, agents, attorneys, representatives,
predecessors, successors, and assigns (collectively, the “Tsai Releasees”)
from any and all Claims (as defined below) which Tsai or any of the other Tsai Releasing Parties have, may have had, or may have
in the future against the Tsai Releasees, whether known or unknown, for all matters relating to, arising out of or in connection
with the status of such Tsai Releasing Party as a shareholder, member, employee, officer, manager and/or director (or equivalent)
of the Company from the beginning of time through the Effective Date. Notwithstanding the foregoing, none of the Tsai Releasing
Parties releases or discharges any (i) accrued compensation or other benefits due such Person as an employee or independent contractor
of the Company, (ii) any rights under the Agreement hereof to which such Person is entitled, (iii) such Tsai Releasing Party’s
rights to indemnification under the Company’s organizational documents in effect on the Effective Date for having served
as an officer, manager or director of the Company, or (iv) such Tsai Releasing Party’s rights to indemnification due to acts
of gross negligence, fraud, deception or acts of ill intent by a Tsai Releasee.

(b)             
Effective as of the date hereof and in consideration for Tsai entering into this Agreement
and selling its ownership interests in Company, which CGI and Company acknowledge will result in substantial benefits, and other
good and valuable consideration, and were expressly bargained for, including without limitation the waiver of the provisions of
California Civil Code Section 1542, Company, on behalf of itself and its Affiliates, agents, attorneys, representatives, successors,
assigns and heirs (together with Company, each a “Company Releasing Party”
and collectively, the “Company Releasing Parties”), hereby, irrevocably
and unconditionally, fully and forever acquits, releases, covenants not to sue, and discharges and agrees to hold harmless the
Tsai and its Affiliates, officers, managers, directors, shareholders, members, partners, employees, agents, attorneys, representatives,
predecessors, successors, and assigns (collectively, the “Company Releasees”)
from any and all Claims (as defined below) which Company or any of the other Company Releasing Parties have, may have had, or may
have in the future against the Company Releasees, whether known or unknown, for all matters relating to, arising out of or in connection
with the status of such Company Releasing Party as a shareholder, member, employee, officer, manager and/or director (or equivalent)
of the Company from the beginning of time through the Effective Date. Notwithstanding the foregoing, none of the Company Releasing
Parties releases or discharges such Company Releasing Party’s rights to indemnification due to acts of gross negligence,
fraud, deception or acts of ill intent by a Company Releasee.

    	8  

    	 

    

 

(c)              
TSAI AND COMPANY SPECIFICALLY WAIVE THE PROVISION OF CALIFORNIA CIVIL CODE SECTION
1542, WHICH PROVIDES AS FOLLOWS:

“A
GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR OR RELEASING PARTY DOES NOT KNOW OR SUSPECT TO EXIST IN HIS OR HER
FAVOR AT THE TIME OF EXECUTING THE RELEASE AND THAT, IF KNOWN BY HIM OR HER, WOULD HAVE MATERIALLY AFFECTED HIS OR HER SETTLEMENT
WITH THE DEBTOR OR RELEASED PARTY.”

(d)             
Each of Tsai and Company hereby irrevocably covenants to refrain from asserting any
Claim or demand, or commencing, instituting or causing to be commenced, any Claims of any kind against any of the Tsai Releasees
or Company Releases, respectively, purported to be released hereby. Each Tsai Releasing Party shall be solely liable for 100% (and
no other Tsai Releasing Party shall have any liability with respect thereto) of any and all losses incurred by the Tsai Releasees
to the extent resulting from the assertion by such Tsai Releasing Party of any Claim purported to be released hereby. Each Company
Releasing Party shall be solely liable for 100% (and no other Company Releasing Party shall have any liability with respect thereto)
of any and all losses incurred by the Company Releasees to the extent resulting from the assertion by such Company Releasing Party
of any Claim purported to be released hereby.

(e)              
For the purposes of this Section 7.01, the terms “Claim”
or “Claims” mean any and all actions, claims, charges, demands, liabilities,
losses, damages, obligations, costs and expenses, interest, awards, judgments and penalties (including, without limitation reasonable
attorneys’ fees and court costs) actually suffered or incurred by any Tsai Releasing Party or Company Releasing Party (as
applicable), including in any action brought or otherwise initiated by any Tsai Releasing Party or Company Releasing Party (as
applicable), of any nature whatsoever whether or not now known, claimed or suspected, fixed or contingent, arising or resulting
from any manner of action or actions, cause or causes of action in law or in equity, judgments, suits, debts, liens, contracts,
torts, covenants, fiduciary duties, responsibilities, agreements, promises, liabilities, claims, demands and losses, in each case,
arising on or before the Effective Date.

Section 7.02         
Transfer of Obligations on Shares.

(a)              
 The Shares are subject to the rights and obligations of shareholders of the Company as set forth in the Shareholders
Agreement, dated June 5, 2020, (as amended from time to time, the “Shareholders Agreement”),
by and among Alan Tsai, Edward Manolos, Cannabis Global, Inc., Betterworld Ventures, LLC, Marijuana Company of America, Inc. and
the Company. Transfer of the Shares from the Tsai to CGI is conditioned upon CGI’s acceptance of those rights and obligations
and execution of the Joinder Agreement contemplated by the Shareholders Agreement, a form of which is attached hereto as Exhibit
A.

    	9  

    	 

    

 

(b)             
The Shares are subject to the rights of Betterworld Ventures, LLC, a shareholder of the Company (“BWV”)
and the obligations of the Company and certain of its shareholders under Section 6.01 of the Common Stock Purchase Agreement among
the Company, BWV and those shareholders. A copy of Section 6.01 is attached hereto as Exhibit B. Transfer of the Shares
from the Tsai to CGI is conditioned upon CGI’s acknowledgement and acceptance of the terms of Section 6.01 as indicated on
Exhibit B.

Section
7.03       Expenses. All costs and expenses incurred
in connection with this Agreement and the transactions contemplated hereby shall be paid by the party incurring such costs and
expenses.

Section
7.04       Notices. All notices, claims, demands,
and other communications hereunder shall be in writing and shall be deemed to have been given: (a) when delivered by hand (with
written confirmation of receipt); (b) when received by the addressee if sent by a nationally recognized overnight courier (receipt
requested); (c) on the date sent by facsimile or email of a PDF document (with confirmation of transmission) if sent during normal
business hours of the recipient, and on the next business day if sent after normal business hours of the recipient; or (d) on the
third day after the date mailed, by certified or registered mail, return receipt requested, postage prepaid, if sent to the respective
parties at the following addresses (or at such other address for a party as shall be specified in a notice given in accordance
with this Section 7.04):

	If to Tsai:	
        80 Sierra Madre Blvd. #C

        Sierra Madre, CA 91024

        Email: alant311@gmail.com

        Attention: Alan Tsai

         

	If to CGI:	
        520 S. Grand Ave., Ste. 320

        Los Angeles, CA 90071

        Email: arman@cannabisglobalinc.com

        Attention: Arman Tabatabaei

         

Section
7.05       Interpretation; Headings. This Agreement
shall be construed without regard to any presumption or rule requiring construction or interpretation against the party drafting
an instrument or causing any instrument to be drafted. The headings in this Agreement are for reference only and shall not affect
the interpretation of this Agreement.

Section
7.06       Severability. If any term or provision
of this Agreement is invalid, illegal, or unenforceable in any jurisdiction, such invalidity, illegality, or unenforceability shall
not affect any other term or provision of this Agreement.

Section
7.07       Entire Agreement. This Agreement and the
other Transaction Documents constitute the sole and entire agreement of the parties to this Agreement with respect to the subject
matter contained herein and therein, and supersede all prior and contemporaneous understandings and agreements, both written and
oral, with respect to such subject matter. In the event of any inconsistency between the statements in the body of this Agreement
and those in the other Transaction Documents, any exhibits, and the Disclosure Schedules (other than an exception expressly set
forth as such in the Disclosure Schedules), the statements in the body of this Agreement will control.

    	10  

    	 

    

 

Section
7.08       Successors and Assigns. This Agreement
shall be binding upon and shall inure to the benefit of the parties hereto and their respective successors and permitted assigns.
Neither party may assign its rights or obligations hereunder without the prior written consent of the other party, which consent
shall not be unreasonably withheld or delayed. No assignment shall relieve the assigning party of any of its obligations hereunder.

Section
7.09       Amendment and Modification; Waiver. This
Agreement may only be amended, modified, or supplemented by an agreement in writing signed by each party hereto. No waiver by any
party of any of the provisions hereof shall be effective unless explicitly set forth in writing and signed by the party so waiving.
No failure to exercise, or delay in exercising, any right or remedy arising from this Agreement shall operate or be construed as
a waiver thereof; nor shall any single or partial exercise of any right or remedy hereunder preclude any other or further exercise
thereof or the exercise of any other right or remedy.

Section
7.10       Governing Law; Submission to Jurisdiction.
This Agreement shall be governed by and construed in accordance with the internal laws of the State of California without giving
effect to any choice or conflict of law provision or rule (whether of the State of California or any other jurisdiction). Any legal
suit, action, proceeding, or dispute arising out of or related to this Agreement, the other Transaction Documents, or the transactions
contemplated hereby or thereby may be instituted in the federal courts of the United States of America or the courts of the State
of California in each case located in the county of San Diego, and each party irrevocably submits to the exclusive jurisdiction
of such courts in any such suit, action, proceeding, or dispute.

Section 7.11      
Counterparts.
This Agreement may be executed in counterparts, each of which shall be deemed an original, but all of which together shall be deemed
to be one and the same agreement. A signed copy of this Agreement delivered by email or other means of electronic transmission
shall be deemed to have the same legal effect as delivery of an original signed copy of this Agreement.

Section
7.12       Prevailing Party. If
any litigation or other court action, arbitration or similar adjudicatory proceeding is commenced by any party to enforce its rights
under this Agreement against any other party, all fees, costs and expenses, including, without limitation, reasonable attorney’s
fees and court costs, incurred by the prevailing party in such litigation, action, arbitration or proceeding shall be reimbursed
by the losing party; provided, that if a party to such litigation, action, arbitration or proceeding prevails in part, and loses
in part, the court, arbitrator or other adjudicator presiding over such litigation, action, arbitration or proceeding shall award
a reimbursement of the fees, costs and expenses incurred by such party on an equitable basis.

(signature
page follows)

 

    	11  

    	 

    

IN WITNESS WHEREOF, the parties hereto
have caused this Stock Purchase Agreement to be executed as of the date first written above individually or by their respective
officers thereunto duly authorized.

 

	 	
        Alan Tsai

         

	 	/s/ Alan Tsai        

         

	 	
        Cannabis Global, Inc.

         

	 	By: /s/
    Arman Tabatabaei       
 Name: Arman Tabatabaei
 Title:   CEO

 

 

 

    	  

    	 

    

SCHEDULE 1

The Shares

 

	Alan Tsai	266,667 shares of Common Stock

 

 

 

 

 

    	  

    	 

    

SCHEDULE 1.02

Tsai Liability Schedule

 

	Estimated Amount of Instrument / Claim 	Lender/Investor	Instrument
	$329,000.00	Green Rock Investment Fund LLC (Cindy Huang)	Promissory Note, dated May 17, 2018
	$93,000.00	Green Rock Investment Fund LLC (Cindy Huang)	Promissory Note; modified by Installment Promissory Note June 27, 2020
	$110,000.00	Long Canyon Properties Holding, LLC	Not documented
	$200,000.00	Johnny Wong	Not documented
	$300,000.00	Zichuan An & Shucun Xie	Promissory Note and Revolving Line of Credit Agreement
	$500,000.00	Zichuan An & Shucun Xie	Not documented--Green Ethos > Wright Road
	$60,000.00	Eric Liu	Promissory Note and Revolving Line of Credit Agreement
	$289,500.00	Chau Tai Huang & Tzu Li Pai	Promissory Note

 

 

 

 

 

 

    	  

    	 

    

EXHIBIT
A

JOINDER AGREEMENT

Reference is hereby made to the
Shareholders Agreement, dated June 5, 2020, (as amended from time to time, the “Shareholders Agreement”), by
and among Alan Tsai, Edward Manolos, Cannabis Global, Inc., Betterworld Ventures, LLC, Marijuana Company of America, Inc. and Natural
Plant Extract of California, Inc., a California corporation (the “Company”). Pursuant to and in accordance with
Sections 3.01(d) and 4.01(e) of the Shareholders Agreement, the undersigned hereby agrees that upon the execution
of this Joinder Agreement, it shall become a party to the Shareholders Agreement and shall be fully bound by, and subject to, all
of the covenants, terms and conditions of the Shareholders Agreement as though an original party thereto and shall be deemed to
be a Shareholder of the Company for all purposes thereof.

Capitalized terms used herein
without definition shall have the meanings ascribed thereto in the Shareholders Agreement.

 

IN WITNESS WHEREOF, the parties
hereto have executed this Agreement as of February 16, 2021.

 

	 	
        Cannabis Global, Inc.

         

	 	By:
    /s/ Arman Tabatabaei      
 Name: Arman Tabatabaei
 Title:   CEO

 

 

    	A-1  

    	 

    

EXHIBIT B

 

SECTION 6.01 TO COMMON STOCK PURCHASE
AGREEMENT

 

Section
6.01Treatment of Existing Debt. As of the Closing Date, Company has outstanding debt
of approximately $1,322,357 pursuant to the instruments, loans and expense reimbursement obligations described in Nos. 1-9 of Section
4.06 of the Disclosure Schedule (the “Outstanding Debt”). The Parties
wish to clarify the treatment and payment obligations for the Outstanding Debt as of the Closing Date and thereafter as follows:

(a)              
The Outstanding Debt is an obligation of Company and repayment shall be made by Company.

(b)             
The Outstanding Debt was incurred prior to the Closing Date and prior to BWV’s
investment in and involvement with Company.

(c)              
At Closing, the Shares acquired by BWV shall equal forty percent (40%) (the “CGI
Percentage”) of Company’s outstanding capital stock on a fully diluted basis,
taking into account outstanding options, warrants and other promises of equity issued to any Person (“Fully-Diluted
Equity”). 

(d)             
From time to time the BWV Percentage shall be adjusted to the extent BWV acquires
additional shares, or shares are issued to other investors, employees, consultants, partners or shareholders.

(e)              
To the extent Company is unable to repay the Outstanding Debt when due and the applicable creditors commence a default
action against Company, BWV
at its option may unilaterally negotiate a settlement and pay off such Outstanding Debt (“Pay-Off Amount”) and increase
its common stock position in Company based on a valuation of Company’s business performed by an independent third-party appraisal
firm experienced in valuations of companies engaged in cannabis manufacturing and distribution[1]
(the “Valuation”), with the price per share of Company’s capital stock and BWV’s
increased equity position determined according to the following formulae:

Valuation / Fully-Diluted Equity
= Price Per Share

Pay-Off Amount / Price Per
Share = New Shares to BWV

[1]
Such independent third-party appraisal firm to be mutually agreed between
Company and BWV. In the event the Parties are unable to agree
on an independent third-party appraiser within fifteen (15) days of first notice, the appraisal issue shall be submitted to JAMS’
San Diego office for the appointment by JAMS of such independent qualified appraiser to decide, without any right of appeal
and after a hearing and the submission of evidence, the appraisal price.

 

    	B-1  

    	 

    

 

As an example, assume BWV
pays off all the Outstanding Debt. If the appraiser returns a valuation of Company’s business at $6,000,000 and there are
6,000,000 shares outstanding on a fully-diluted based, new shares issued to BWV
would be 1,322,357 based on the following:

$6,000,000 / 6,000,000 = $1.00
per share

$1,322,357 / $1.00 = 1,322,357
new shares

(f)               
In any fiscal year that Company determines to distribute to shareholders a dividend or other distribution, Company profits
shall be first be calculated without regard to Outstanding Debt payments made by Company in that fiscal year on the Outstanding
Debt (“Net Profits Before Debt”). If there are sufficient Net Profits Before Debt, such dividend or other distribution
shall be made as follows:

(i)                
First, the BWV
Percentage of such Net Profits Before Debt approved for distribution shall go to BWV.

(ii)             
Second, the remaining Net Profits approved for distribution shall be reduced by payments for that prior fiscal year
on the Outstanding Debt (“Net Profits After Debt”); and

(iii)           
Third, any remaining Net Profits After Debt after taking into account subparagraphs (f)(i) and (f)(ii) above shall be
distributed to the other shareholders.

As an example, assume:

		·	In year 1 Company is profitable and the Board of Directors wishes to declare a cash dividend to shareholders;

		·	Company has paid $50,000 in Outstanding Debt payments during year 1; and

		·	Company has $100,000 in Net Profits Before Debt.

The proposed dividends would be
paid as follows:

First, BWV
would receive $40,000 based on $100,000 Net Profits Before Debt multiplied by the BWV
Percentage (currently 40%);

Second, the remaining $60,000
available would be reduced by the amount of Outstanding Debt payments in year 1 ($50,000) leaving $10,000 as Net Profits After
Debt; and

Third, the $10,000 Net Profits
After Debt would be distributed to the other shareholders of Company as a cash dividend, pro rata.

    	B-2  

    	 

    

 

(g)              
 Upon any Sale Event (as defined below) of Company:

(i)                
The Shares shall have a liquidation preference that calculates net proceeds to shareholders prior to pay-off of the
Outstanding Debt and distributes to BWV
the BWV
Percentage of such pre-Outstanding Debt net proceeds prior to payments to any other shareholder; and

(ii)             
The other shareholders shall receive the remainder, if any, of the proceeds after taking into account pay-off of the
Outstanding Debt.

As an example, assume if in
year 5:

		·	there was still $500,000 of Outstanding Debt;

		·	The Company was sold for $6,000,000;

		·	The BWV
Percentage is still 40%; and

		·	After paying off all debts and obligations including the Outstanding Debt, there was $4,000,000 available for distribution
to the shareholders.

The proceeds to shareholders would
be paid as follows:

First, BWV’s
distribution of net proceeds would assume the $500,000 Outstanding Debt did not exist and BWV
would receive $1,800,000 based on the following:

($4,000,000 + $500,000) * 0.40 =
$1,800,000

This amount = 45% of the $4,000,000
actually available for distribution

Second, the other shareholders
would share $2,200,000 based on the following:

$4,000,000 - $1,800,000 = $2,200,000

This amount = 55% of the $4,000,000
available for distribution

(h)             
Within forty-five (45) days of closing, Company shall amend its charter to reflect paragraphs (f) and (g) above.

(i)                
Within thirty (30) days of Closing, Company shall make good faith efforts to renegotiate the Outstanding Debt
to extend maturity dates, implement reasonable payment schedules, and eliminate references to debt payments being made from a percentage
of net profits.

    	B-3  

    	 

    

 

For purposes of this Section 6.01,
“Sale Event” means any of:

A.               
a merger or consolidation in which (i) Company is a constituent party or (ii) a subsidiary of Company is a constituent
party and Company issues shares of its capital stock pursuant to such merger or consolidation, except any such merger or consolidation
involving Company or a subsidiary in which the shares of capital stock of Company outstanding immediately prior to such merger
or consolidation continue to represent, or are converted into or exchanged for equity securities that represent, immediately following
such merger or consolidation, at least a majority, by voting power, of the equity securities of (1) the surviving or resulting
party or (2) if the surviving or resulting party is a wholly owned subsidiary of another party immediately following such merger
or consolidation, the parent of such surviving or resulting party; provided that, for the purpose of this definition,
all shares of common stock issuable upon exercise of options outstanding immediately prior to such merger or consolidation or upon
conversion of preferred outstanding immediately prior to such merger or consolidation shall be deemed to be outstanding immediately
prior to such merger or consolidation and, if applicable, deemed to be converted or exchanged in such merger or consolidation on
the same terms as the actual outstanding shares of common stock are converted or exchanged; or

B.                
the sale, lease, transfer, exclusive license or other disposition, in a single transaction or series of related
transactions, by Company or any subsidiary of Company of all or substantially all the assets of Company and its subsidiaries taken
as a whole, or, if substantially all of the assets of Company and its subsidiaries taken as a whole are held by such subsidiary
or subsidiaries, the sale or disposition (whether by merger or otherwise) of one or more subsidiaries of Company, except where
such sale, lease, transfer or other disposition is to Company or one or more wholly owned subsidiaries of Company.

 

ACKNOWLEDGED AND ACCEPTED:

 

	
        Cannabis Global, Inc.

         

	By: /s/
    Arman Tabatabaei     
 Name: Arman Tabatabaei
 Title:   CEO

 

 

    	B-4

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