Document:

intv_ex1031.htm

EXHIBIT 10.31
  
 SECURITIES PURCHASE AGREEMENT
  
 This Securities Purchase Agreement (this “Agreement”) is dated as of September 21, 2018, between Integrated Ventures, Inc., a Nevada corporation and its predecessors (the “Company”), and each purchaser identified on the signature pages hereto (each, including its successors and permitted assigns, a “Purchaser” and collectively, the “Purchasers”).
  
 WHEREAS, subject to the terms and conditions set forth in this Agreement and pursuant to Section 4(a)(2) of the Securities Act of 1933, as amended (the “Securities Act”), and Rule 506(b) promulgated thereunder, the Company desires to issue and sell to each Purchaser, and each Purchaser, severally and not jointly, desires to purchase from the Company, securities of the Company as more fully described in this Agreement.
  
 NOW, THEREFORE, IN CONSIDERATION of the mutual covenants contained in this Agreement, and for other good and valuable consideration, the receipt and adequacy of which are hereby acknowledged, the Company and each Purchaser agree as follows:
  
 ARTICLE I. 
 DEFINITIONS
  
 1.1 Definitions. In addition to the terms defined elsewhere in this Agreement: (a) capitalized terms that are not otherwise defined herein have the meanings given to such terms in the Articles of Incorporation (as defined herein), and (b) the following terms have the meanings set forth in this Section 1.1:
  
 “Acquiring Person” shall have the meaning ascribed to such term in Section 4.14.
  
 “Action” shall have the meaning ascribed to such term in Section 3.1(j).
  
 “Affiliate” means any Person that, directly or indirectly through one or more intermediaries, controls or is controlled by or is under common control with a Person, as such terms are used in and construed under Rule 405 under the Securities Act.
  
 “Board of Directors” means the board of directors of the Company.
  
 “Business Day” means any day except any Saturday, any Sunday, any day which is a federal legal holiday in the United States or any day on which banking institutions in the State of New York are authorized or required by law or other governmental action to close.
  
 “Closing” means the closing of the purchase and sale of the Securities pursuant to Section 2.1.
  
 “Closing Date” means the Business Day on which all of the Transaction Documents have been executed and delivered by the applicable parties thereto, and all conditions precedent to (i) the Purchasers’ obligation to pay the Subscription Amount at such Closing, and (ii) the Company’s obligations to deliver the Securities to be issued and sold at such Closing, in each case, have been satisfied or waived.
  
 “Closing Form 8-K” shall have the meaning ascribed to such term in Section 4.20.
  
 “Commission” means the United States Securities and Exchange Commission.
   	 
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 “Common Stock” means the common stock of the Company, $0.001 par value per share, and any other class of securities into which such securities may hereafter be reclassified or changed.
  
 “Common Stock Equivalents” means any securities of the Company or the Subsidiaries which would entitle the holder thereof to acquire at any time Common Stock, including, without limitation, any debt, preferred stock, right, option, warrant or other instrument that is at any time convertible into or exercisable or exchangeable for, or otherwise entitles the holder thereof to receive, Common Stock.
  
 “Company Counsel” means Michael Paige, Esq.
  
 “Conversion Price” shall have the meaning ascribed to such term in the Notes.
  
 “Conversion Shares” means shares of the Company’s Common Stock issuable upon conversion of the Notes and interest in accordance with the terms of the Notes.
  
 “Disclosure Schedules” means the Disclosure Schedules of the Company delivered concurrently herewith.
  
 “Disqualification Event” shall have the meaning ascribed to such term in Section 3.1(ee).
  
 “Due Diligence Shares” shall mean shares of restricted Common Stock issuable to each Purchasers at the Closing at the Due Diligence Shares Ratio.
  
 “Due Diligence Shares Ratio” shall mean 1.5 shares of Common Stock for each $1.00 in purchase price invested at the Closing.
  
 “End Date” shall mean the latter of (i) two years after the Closing Date; or (ii) the date no Purchaser owns any Securities.
  
 “Escrow Agreement” means the escrow agreement to be employed in connection with the sale of the Securities, a copy of which is annexed hereto as Exhibit B.
  
 “Exchange Act” means the Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder.
  
 “Exempt Issuance” means the issuance of (a) shares of Common Stock and options to officers, directors, employees, or consultants of the Company prior to and after the Closing Date in the amounts and on the terms set forth on Schedule 3.1(g), (b) awards made under the Company’s 2016 Stock Incentive Plan, as amended, but not to exceed 15% of the outstanding shares of common stock, (c) securities upon the exercise or exchange of or conversion of Securities issued hereunder (subject to adjustment for forward and reverse stock splits and the like that occur after the date hereof) and/or other securities exercisable or exchangeable for or convertible into shares of Common Stock issued and outstanding on the date of this Agreement, provided that such securities and any term thereof have not been amended since the date of this Agreement to increase the number of such securities or to decrease the issue price, exercise price, exchange price or conversion price of such securities and which securities and the principal terms thereof are set forth on Schedule 3.1(g), and (c) securities issued or issuable pursuant to this Agreement, the Note, and other Transaction Documents, or upon exercise or conversion of any such securities.
   	 
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 “FCPA” means the Foreign Corrupt Practices Act of 1977, as amended.
  
 “Financial Statements” means the financial information regarding the Company included in the SEC Documents filed with the Commission prior to the date hereof.
  
 “Fully-Diluted Basis” means the assumption that all options, warrants or other convertible securities or instruments or other rights to acquire Common Stock or any other existing or future classes of capital stock have been exercised or converted, as applicable, in full, regardless of whether any such options, warrants, convertible securities or instruments or other rights are then vested or exercisable or convertible in accordance with their terms.
  
 “GAAP” shall mean United States generally accepted accounting principles applied on a consistent basis.
  
 “Indebtedness” shall have the meaning ascribed to such term in Section 3.1(v).
  
 “Intellectual Property Rights” shall have the meaning ascribed to such term in Section 3.1(o).
  
 “Legend Removal Date” shall have the meaning ascribed to such term in Section 4.1(d).
  
 “Liens” means a lien, charge, pledge, security interest, encumbrance, right of first refusal, preemptive right or other restriction.
  
 “Material Adverse Effect” shall have the meaning assigned to such term in Section 3.1(b).
  
 “Material Permits” shall have the meaning ascribed to such term in Section 3.1(m).
  
 “Maximum Rate” shall have the meaning ascribed to such term in Section 5.17.
  
 “Money Laundering Laws” shall have the meaning ascribed to such term in Section 3.1(z).
  
 “Notes” means the convertible notes, in the form of Exhibit A hereto.
  
 “OFAC” shall have the meaning ascribed to such term in Section 3.1(aa).
  
 “Person” means an individual or corporation, partnership, trust, incorporated or unincorporated association, joint venture, limited liability company, joint stock company, government (or an agency or subdivision thereof) or other entity of any kind.
  
 “Proceeding” means an action, claim, suit, investigation or proceeding (including, without limitation, an informal investigation or partial proceeding, such as a deposition, whether commenced or threatened.
  
 “Purchaser Counsel” shall mean Grushko & Mittman, P.C., 515 Rockaway Avenue, Valley Stream, New York 11581, facsimile: (212) 697-3575.
   	 
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 “Purchaser Party” shall have the meaning ascribed to such term in Section 4.6.
  
 “Regulation D” means Regulation D under the Securities Act.
  
 “Required Approvals” shall have the meaning ascribed to such term in Section 3.1(e).
  
 “Required Minimum” means, as of any date, the greater of; (i) 1,575,000; or (ii) two (2) times the maximum aggregate number of shares of Common Stock then issued or potentially issuable in the future pursuant to the Transaction Documents, including but not limited to any Underlying Shares issuable upon conversion in full of the principal amount of the Notes and the interest that could accrue through one year after the term thereof ignoring any conversion or exercise limits set forth therein plus such additional amounts as requested by the Purchaser pursuant to the TA Letter.
  
 “Rule 144” means Rule 144 promulgated by the Commission pursuant to the Securities Act, as such Rule may be amended or interpreted from time to time, or any similar rule or regulation hereafter adopted by the Commission having substantially the same purpose and effect as such Rule.
  
 “SEC Documents” means all reports filed by the Company with the Commission under the Exchange Act more than five days prior to the Closing Date.
  
 “Securities” means the Notes, Due Diligence Shares, and the Underlying Shares.
  
 “Securities Act” means the Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder.
  
 “Subscription Amount” means, as to each Purchaser, the aggregate amount to be paid for the Notes purchased hereunder as specified below such Purchaser’s name on the signature page of this Agreement and next to the heading “Subscription Amount,” in United States dollars and in immediately available funds.
  
 “Subsidiary” means with respect to any entity at any date, any direct or indirect corporation, limited or general partnership, limited liability company, trust, estate, association, joint venture or other business entity of which (A) more than 50% of (i) the outstanding capital stock having (in the absence of contingencies) ordinary voting power to elect a majority of the board of directors or other managing body of such entity, (ii) in the case of a partnership or limited liability company, the interest in the capital or profits of such partnership or limited liability company or (iii) in the case of a trust, estate, association, joint venture or other entity, the beneficial interest in such trust, estate, association or other entity business is, at the time of determination, owned or controlled directly or indirectly through one or more intermediaries, by such entity, or (B) is under the actual control of the Company. Representations, undertakings and obligations set forth in this Agreement shall be applicable only to Subsidiaries which exist or have existed at the applicable and relevant time.
  
 “TA Letter” means the letter to the Company’s Transfer Agent in the form annexed hereto as Exhibit C.
  
 “Termination Date” shall have the meaning ascribed to such term in Section 2.1.
  
 “Trading Day” means a day on which the principal Trading Market is open for trading.
  
 “Trading Market” means any of the following markets, quotation services, or exchanges: the NYSE MKT LLC, the Nasdaq Capital Market, the Nasdaq Global Market, the Nasdaq Global Select Market, the New York Stock Exchange, the OTC Bulletin Board, OTCQB, or the OTCQX (or any successors to any of the foregoing).
  
 “Transaction Documents” means this Agreement, the Notes, the Escrow Agreement, all exhibits and schedules thereto and hereto, and any other documents or agreements executed in connection with the transactions contemplated hereunder.
   	 
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 “Transfer Agent” means the transfer agent for the Common Stock, and any successor transfer agent of the Company. As of the Closing Date, the Company’s Transfer Agent is VStock Transfer, LLC, 18 Lafayette Place, Woodmere, NY 11598.
  
 “Underlying Shares” means the shares of Common Stock issued and issuable upon conversion of the Notes and payment of interest on the Notes in accordance with the terms of the Notes.
  
 “Unlegended Shares” shall have the meaning ascribed to such term in Section 4.1(d).
  
 ARTICLE II. 
 PURCHASE AND SALE
  
 2.1 Closing. On the Closing Date, upon the terms and subject to the conditions set forth herein, the Company agrees to sell, and the Purchasers, severally and not jointly, agree to purchase, an aggregate of up to $104,000.00 principal amount of Notes as determined pursuant to Section 2.2(a) (the “Closing”. Each Purchaser shall deliver to the Company such Purchaser’s Subscription Amount, and the Company shall deliver to each Purchaser its respective Note, as determined pursuant to Section 2.2(a), and the Company and each Purchaser shall deliver the other items set forth in Section 2.2 deliverable at the Closing. Upon satisfaction of the covenants and conditions set forth in Sections 2.2 and 2.3, the Closing shall occur at the offices of Purchaser Counsel or such other location as the parties shall mutually agree. Notwithstanding anything herein to the contrary, the Closing must take place on or before September 30, 2018 (the “Termination Date”). If a Closing is not held on or before the Termination Date, the Company shall cause all subscription documents and funds, if any, to be returned, without interest or deduction to each prospective Purchaser.
  
 2.2 Deliveries.
  
 (a) On or prior to the Closing Date, the Company shall deliver or cause to be delivered to each Purchaser the following:
  
 (i) this Agreement duly executed by the Company with the schedules and exhibits thereto current as of the Closing Date;
  
 (ii) a Note with a principal amount equal to 104% such Purchaser’s Subscription Amount registered in the name of such Purchaser;
  
 (iii) the TA Letter executed by the Company and the Transfer Agent; 
  
 (iv) confirmation from the Transfer Agent that the Due Diligence Shares have been issued and are registered in book form (the “TA Confirmation”); and 
  
 (v) the Escrow Agreement duly executed by the Company.
  
 (b) On or prior to the Closing Date, each Purchaser shall deliver or cause to be delivered to the Escrow Agent the following: 
  
 (i) this Agreement duly executed by such Purchaser;
  
 (ii) such Purchaser’s Subscription Amount by wire transfer or as otherwise permitted under the Escrow Agreement, to the Escrow Agent;
  
 (iii) the Escrow Agreement duly executed by such Purchaser; and
  
  	 
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 2.3 Closing Conditions.
  
 (a) The obligations of the Company hereunder to effect a Closing are subject to the following conditions being met:
  
 (i) the accuracy in all material respects (determined without regard to any materiality, Material Adverse Effect or other similar qualifiers therein) on the Closing Date of the representations and warranties of the Purchasers contained herein (unless as of a specific date therein in which case they shall be accurate as of such date);
  
 (ii) all obligations, covenants and agreements of each Purchaser required to be performed at or prior to the Closing Date shall have been performed; and
  
 (iii) the delivery by each Purchaser of the items set forth in Section 2.2(b) of this Agreement.
  
 (b) The respective obligations of a Purchaser hereunder to effect the Closing, unless waived by such Purchaser, are subject to the following conditions being met:
  
 (i) the accuracy in all material respects (determined without regard to any materiality, Material Adverse Effect or other similar qualifiers therein) on the Closing Date of the representations and warranties of the Company contained herein (unless as of a specific date therein in which case they shall be accurate as of such date);
  
 (ii) all obligations, covenants and agreements of the Company required to be performed at or prior to the Closing Date shall have been performed; 
  
 (iii) the Escrow Agent shall have received executed signature pages to this Agreement with respect to the Subscription Amounts for which the Closing is to occur;
  
 (iv) the delivery by the Company of the items set forth in Section 2.2(a) of this Agreement; 
  
 (v) there shall have been no Material Adverse Effect with respect to the Company since the date hereof; and
  
 (vi) from the date hereof to the Closing Date, trading in securities in the United States generally as reported by Bloomberg L.P. shall not have been suspended or limited, nor shall a banking moratorium have been declared either by the United States or New York State authorities nor shall there have occurred any material outbreak or escalation of hostilities or other national or international calamity of such magnitude in its effect on, or any material adverse change in, any financial market which, in each case, in the reasonable judgment of such Purchaser, makes it impracticable or inadvisable to purchase the Securities at the Closing.
  
 ARTICLE III. 
 REPRESENTATIONS AND WARRANTIES
  
 3.1 Representations and Warranties of the Company. Except as set forth in the Disclosure Schedules, which Disclosure Schedules shall be deemed a part hereof and shall qualify any representation made herein to which it refers and any other representation to the extent such Disclosure Schedule reasonably relates thereto without a requirement of a cross-reference. The Company hereby makes the following representations and warranties to each Purchaser as of the date hereof and the Closing Date unless as of a specific date therein in which case they shall be accurate as of such date:
  
 (a) Subsidiaries. The Company owns, directly or indirectly, all of the capital stock or other equity interests of each Subsidiary free and clear of any Liens, and all of the issued and outstanding shares of capital stock of each Subsidiary are validly issued and are fully paid, non-assessable and free of preemptive and similar rights to subscribe for or purchase securities. If the Company has no Subsidiaries relevant to any component of this Agreement as of a particular date, then such reference shall not be applicable.
  
  	 
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 (b) Organization and Qualification. The Company and each of the Subsidiaries is an entity duly incorporated or otherwise organized, validly existing and in good standing under the laws of the jurisdiction of its incorporation or organization, with the requisite power and authority to own and use its properties and assets and to carry on its business as currently conducted. Neither the Company nor any Subsidiary is in violation nor default of any of the provisions of its respective certificate or articles of incorporation, bylaws or other organizational or charter documents. Each of the Company and the Subsidiaries is duly qualified to conduct business and is in good standing as a foreign corporation or other entity in each jurisdiction in which the nature of the business conducted or property owned by it makes such qualification necessary, except where the failure to be so qualified or in good standing, as the case may be, could not have or reasonably be expected to result in: (i) a material adverse effect on the legality, validity or enforceability of any Transaction Document, (ii) a material adverse effect on the results of operations, assets, business, prospects or condition (financial or otherwise) of the Company and the Subsidiaries, taken as a whole, (iii) a material adverse effect on the Company’s ability to perform in any material respect on a timely basis its obligations under any Transaction Document, or (iv) the occurrence of a Disqualification Event (any of (i), (ii), (iii) or (iv), a “Material Adverse Effect”) and, no Proceeding has been instituted in any such jurisdiction revoking, limiting or curtailing or seeking to revoke, limit or curtail such power and authority or qualification.
  
 (c) Authorization; Enforcement. The Company has the requisite corporate power and authority to enter into and to consummate the transactions contemplated by this Agreement and each of the other Transaction Documents and otherwise to carry out its obligations hereunder and thereunder. The execution and delivery of this Agreement and each of the other Transaction Documents by the Company and the consummation by it of the transactions contemplated hereby and thereby have been duly authorized by all necessary action on the part of the Company and no further action is required by the Company, the Board of Directors or the Company’s stockholders and creditors in connection herewith or therewith other than in connection with the Required Approvals except those filings requires to be made with the Commission and state agencies after the Closing Date. This Agreement and each other Transaction Document to which it is a party has been (or upon delivery will have been) duly executed by the Company and, when delivered in accordance with the terms hereof and thereof, will constitute the valid and binding obligations of the Company enforceable against the Company in accordance with their terms, except: (i) as limited by general equitable principles and applicable bankruptcy, insolvency, reorganization, moratorium and other laws of general application affecting enforcement of creditors’ rights generally, (ii) as limited by laws relating to the availability of specific performance, injunctive relief or other equitable remedies and (iii) insofar as indemnification and contribution provisions may be limited by applicable law.
  
 (d) No Conflicts. The execution, delivery and performance by the Company of this Agreement and the other Transaction Documents, the issuance and sale of the Securities and the consummation by it of the transactions contemplated hereby and thereby to which it is a party do not and will not: (i) conflict with or violate any provision of the Company’s or any Subsidiary’s certificate or articles of incorporation, bylaws or other organizational or charter documents, (ii) conflict with, or constitute a default (or an event that with notice or lapse of time or both would become a default) under, result in the creation of any Lien upon any of the properties or assets of the Company or any Subsidiary, or give to others any rights of termination, amendment, acceleration or cancellation (with or without notice, lapse of time or both) of, any agreement, credit facility, debt or other instrument (evidencing a Company or Subsidiary debt or otherwise) or other understanding to which the Company or any Subsidiary is a party or by which any property or asset of the Company or any Subsidiary is bound or affected, or (iii) conflict with or result in a violation of any law, rule, regulation, order, judgment, injunction, decree or other restriction of any court or governmental authority to which the Company or a Subsidiary is subject (including federal and state securities laws and regulations), or by which any property or asset of the Company or a Subsidiary is bound or affected.
  
 (e) Filings, Consents and Approvals. The Company is not required to obtain any consent, waiver, authorization or order of, give any notice to, or make any filing or registration with, any court or other federal, state, local or other governmental authority or other Person in connection with the execution, delivery and performance by the Company of the Transaction Documents, other than: (i) the filing of Form D with the Commission, and (ii) such filings as are required to be made under applicable state securities laws (collectively, the “Required Approvals”).
  
 (f) Issuance of the Securities. The Securities are duly authorized and, when issued and paid for in accordance with the applicable Transaction Documents, will be duly and validly issued, fully paid and nonassessable, free and clear of all Liens other than those created by the Purchaser. The Company has reserved from its duly authorized capital stock a number of shares of Common Stock for issuance of the Underlying Shares at least equal to the Required Minimum. In order to ensure such reservation the Company shall have its Transfer Agent countersign the TA Letter, at the Closing. The failure to comply with the terms of this section shall be a material breach of the agreement. The Purchaser agrees that it will release a number of shares reserved from its portion of the Required Minimum, as set forth on such Purchaser’s signature page, solely for the use of the Company to issue to make an acquisition of a strategic asset or merger. In no event may such shares be used for any capital raising purposes.
  
  	 
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 (g) Capitalization. As of the date of this Agreement, the capitalization of the Company is as set forth in Schedule 3.1(g). Except as disclosed on Schedule 3.1(g), no Person has any right of first refusal, preemptive right, right of participation, or any similar right to participate in the transactions contemplated by the Transaction Documents. Except as disclosed on Schedule 3.1(g), as of the date of this Agreement there are no outstanding options, employee or incentive stock option plans warrants, scrip rights to subscribe to, calls or commitments of any character whatsoever relating to, or securities, rights or obligations convertible into or exercisable or exchangeable for, or giving any Person any right to subscribe for or acquire any shares of Common Stock, or contracts, commitments, understandings or arrangements by which the Company or any Subsidiary is or may become bound to issue additional shares of Common Stock or Common Stock Equivalents. Except for the 2016 Stock Incentive Plan under which the Company has reserved a maximum of 2,000,000 common shares, there is no stock option plan in effect as of the Closing Date. Except as set forth on Schedule 3.1(g), the issuance and sale of the Securities will not obligate the Company to issue shares of Common Stock or other securities to any Person (other than the Purchasers) and will not result in a right of any holder of Company securities to adjust the exercise, conversion, exchange or reset price under any of such securities. All of the outstanding shares of capital stock of the Company are duly authorized, validly issued, fully paid and nonassessable, have been issued in material compliance with all federal and state securities laws, and none of such outstanding shares was issued in violation of any preemptive rights or similar rights to subscribe for or purchase securities. No further approval or authorization of any stockholder, the Board of Directors or others is required for the issuance and sale of the Securities. There are no stockholders agreements, voting agreements or other similar agreements with respect to the Company’s capital stock to which the Company is a party or, to the knowledge of the Company, between or among any of the Company’s stockholders.
  
 (h) Financial Statements. The Financial Statements have been prepared in accordance with GAAP. The Financial Statements fairly present in all material respects the financial position of the Company and its consolidated Subsidiaries as of and for the dates thereof and the results of operations and cash flows for the periods then ended, subject to normal, immaterial adjustments and inclusion of footnotes which would be required pursuant to generally accepted accounting principles. The Financial Statements include balance sheets as of each of the most recent fiscal year ends and as of a quarter end within 45 days immediately preceding the relevant Closing Date and income statements as of the same dates.
  
 (i) Material Changes; Undisclosed Events, Liabilities or Developments. Since the date of the most recently dated Financial Statements: (i) there has been no event, occurrence or development that has had or that could reasonably be expected to result in a Material Adverse Effect, (ii) the Company has not incurred any material liabilities (contingent or otherwise) other than trade payables and accrued expenses incurred in the ordinary course of business consistent with past practice, (iii) the Company has not altered its method of accounting, (iv) the Company has not declared or made any dividend or distribution of cash or other property to its stockholders or purchased, redeemed or made any agreements to purchase or redeem any shares of its capital stock and (v) the Company has not issued any equity securities to any officer, director or Affiliate.
  
 (j) Litigation. Except for current litigation with the Company’s former accountant, there is no action, suit, inquiry, notice of violation, proceeding or investigation pending or, to the knowledge of the Company, threatened against or affecting the Company, any Subsidiary or any of their respective properties before or by any court, arbitrator, governmental or administrative agency or regulatory authority (federal, state, county, local or foreign) (collectively, an “Action”) which (i) adversely affects or challenges the legality, validity or enforceability of any of the Transaction Documents or the Securities or (ii) could, if there were an unfavorable decision, have or reasonably be expected to result in a Material Adverse Effect. At no time, neither the Company nor any Subsidiary, nor any director or officer thereof, is or has been the subject of any Action involving a claim of violation of or liability under federal or state securities laws or a claim of breach of fiduciary duty. There has not been, and to the knowledge of the Company, there is not pending or contemplated, any investigation by the Commission involving the Company or any current or former director or officer of the Company. The Commission has not issued any stop order or other order suspending the effectiveness of any registration statement filed by the Company or any Subsidiary under the Exchange Act or the Securities Act.
  
 (k) Labor Relations. No labor dispute exists or, to the knowledge of the Company, is imminent with respect to any of the employees of the Company, which could reasonably be expected to result in a Material Adverse Effect. None of the Company’s or its Subsidiaries’ employees is a member of a union that relates to such employee’s relationship with the Company or such Subsidiary, and neither the Company nor any of its Subsidiaries is a party to a collective bargaining agreement, and the Company and its Subsidiaries believe that their relationships with their employees are good. To the knowledge of the Company, no executive officer of the Company or any Subsidiary, is, or is now expected to be, in violation of any material term of any employment contract, confidentiality, disclosure or proprietary information agreement or non-competition agreement, or any other contract or agreement or any restrictive covenant in favor of any third party, and the continued employment of each such executive officer does not subject the Company or any of its Subsidiaries to any liability with respect to any of the foregoing matters. The Company and its Subsidiaries are in compliance with all U.S. federal, state, local and foreign laws and regulations relating to employment and employment practices, terms and conditions of employment and wages and hours, except where the failure to be in compliance could not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.
  
  	 
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 (l) Compliance. Neither the Company nor any Subsidiary: (i) is in default under or in violation of (and no event has occurred that has not been waived that, with notice or lapse of time or both, would result in a default by the Company or any Subsidiary under), nor has the Company or any Subsidiary received notice of a claim that it is in default under or that it is in violation of, any indenture, loan or credit agreement or any other agreement or instrument to which it is a party or by which it or any of its properties is bound (whether or not such default or violation has been waived), (ii) is in violation of any judgment, decree or order of any court, arbitrator or other governmental authority or (iii) is or has been in violation of any statute, rule, ordinance or regulation of any governmental authority, including without limitation all foreign, federal, state and local laws relating to taxes, environmental protection, occupational health and safety, product quality and safety and employment and labor matters, except in each case as could not have or reasonably be expected to result in a Material Adverse Effect.
  
 (m) Regulatory Permits. The Company and the Subsidiaries possess all certificates, authorizations and permits issued by the appropriate federal, state, local or foreign regulatory authorities necessary to conduct their respective businesses as presently conducted, and as contemplated to be conducted, except where the failure to possess such permits could not reasonably be expected to result in a Material Adverse Effect (“Material Permits”), and neither the Company nor any Subsidiary has received any notice of proceedings relating to the revocation or modification of any Material Permit.
  
 (n) Title to Assets. The Company and the Subsidiaries have good and marketable title in all personal property owned by them that is material to the business of the Company and the Subsidiaries, in each case free and clear of all Liens, except for (i) Liens as do not materially affect the value of such property and do not materially interfere with the use made and proposed to be made of such property by the Company and the Subsidiaries and (ii) Liens for the payment of federal, state or other taxes, for which appropriate reserves have been made and, the payment of which is neither delinquent nor subject to penalties. The Company and Subsidiaries do not own any real property. Any real property and facilities held under lease by the Company and the Subsidiaries are held by them under valid, subsisting and enforceable leases with which the Company and the Subsidiaries are in compliance.
  
 (o) [RESERVED]
  
 (p) Transactions With Affiliates and Employees. Except as set forth in the Financial Statements and Transaction Documents, none of the officers or directors of the Company or any Subsidiary and, to the knowledge of the Company, none of the employees of the Company or any Subsidiary is presently a party to any transaction with the Company or any Subsidiary (other than for services as employees, officers and directors), including any contract, agreement or other arrangement providing for the furnishing of services to or by, providing for rental of real or personal property to or from, providing for the borrowing of money from or lending of money to or otherwise requiring payments to or from any officer, director or such employee or, to the knowledge of the Company, any entity in which any officer, director, or any such employee has a substantial interest or is an officer, director, trustee, stockholder, member or partner.
  
 (q) Certain Fees. Except as set forth on Schedule 3.1(q), no brokerage, finder’s fees, commissions or due diligence fees are or will be payable by the Company or any Subsidiary to any broker, financial advisor or consultant, finder, placement agent, investment banker, bank or other Person with respect to the transactions contemplated by the Transaction Documents. The Purchasers shall have no obligation with respect to any such fees or with respect to any claims made by or on behalf of other Persons for fees of a type contemplated in this Section 3.1(q) that may be due in connection with the transactions contemplated by the Transaction Documents. The Company is not aware of any person that has been or will be paid (directly or indirectly) remuneration for solicitation of purchasers in connection with the sale of any Regulation D Securities.
  
 (r) Investment Company. The Company is not, and is not an Affiliate of, and immediately after receipt of payment for the Securities, will not be or be an Affiliate of, an “investment company” within the meaning of the Investment Company Act of 1940, as amended. The Company shall conduct its business in a manner so that it will not become an “investment company” subject to registration under the Investment Company Act of 1940, as amended. 
  
 (s) Registration Rights. No Person has any right to cause the Company or any Subsidiary to effect the registration under the Securities Act of any securities of the Company or any Subsidiary, except for the Purchasers.
  
  	 
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 (t) Application of Takeover Protections. As of the Closing Date, the Company will have taken all necessary action, if any or if necessary, in order to render inapplicable as of the Closing Date and thereafter any control share acquisition, business combinations, poison pill (including any distribution under a rights agreement) or other similar anti-takeover provision under the Company’s certificate of incorporation (or similar charter documents) or the laws of the State of Nevada that is or could become applicable to the Purchasers as a result of the Purchasers and the Company fulfilling their obligations or exercising their rights under the Transaction Documents, including without limitation as a result of the Company’s issuance of the Securities and the Purchasers’ ownership of the Securities.
  
 (u) Disclosure. All of the disclosure furnished by or on behalf of the Company to the Purchasers regarding the Company and its Subsidiaries, their respective businesses and the transactions contemplated hereby, including the Disclosure Schedules to this Agreement, when taken together as a whole, is true and correct in all material respects and does not contain any untrue statement of a material fact or omit to state any material fact necessary in order to make the statements made therein, in light of the circumstances under which they were made, not misleading. The Company acknowledges and agrees that no Purchaser makes or has made any representations or warranties with respect to the transactions contemplated hereby other than those specifically set forth in Section 3.2.
  
 (v) Solvency. The Company has no knowledge of any facts or circumstances which lead it to believe that it will file for reorganization or liquidation under the bankruptcy or reorganization laws of any jurisdiction within one year from the Closing Date. The Financial Statements set forth all outstanding liens secured and unsecured Indebtedness of the Company or any Subsidiary, or for which the Company or any Subsidiary has commitments as of the respective dates of the Financial Statements. For the purposes of this Agreement, “Indebtedness” means (y) any liabilities for borrowed money or amounts owed in excess of $50,000 in the aggregate and (z) the present value of any lease payments in excess of $50,000 due under leases required to be capitalized in accordance with generally accepted accounting principles. Neither the Company nor any Subsidiary is in default with respect to any Indebtedness.
  
 (w) Tax Status. Except for matters that would not, individually or in the aggregate, have or reasonably be expected to result in a Material Adverse Effect, the Company and its Subsidiaries each (i) has made or filed all United States federal, state and local income and all foreign income and franchise tax returns, reports and declarations required by any jurisdiction to which it is subject, (ii) has paid all taxes and other governmental assessments and charges that are material in amount, shown or determined to be due on such returns, reports and declarations and (iii) has set aside on its books provision reasonably adequate for the payment of all material taxes for periods subsequent to the periods to which such returns, reports or declarations apply. There are no unpaid taxes in any material amount claimed to be due by the taxing authority of any jurisdiction, and the officers of the Company or of any Subsidiary know of no basis for any such claim.
  
 (x) Foreign Corrupt Practices. Neither the Company nor any Subsidiary, nor to the knowledge of the Company or any Subsidiary, any agent or other person acting on behalf of the Company or any Subsidiary, has: (i) directly or indirectly, used any funds for unlawful contributions, gifts, entertainment or other unlawful expenses related to foreign or domestic political activity, (ii) made any unlawful payment to foreign or domestic government officials or employees or to any foreign or domestic political parties or campaigns from corporate funds, (iii) failed to disclose fully any contribution made by the Company or any Subsidiary (or made by any person acting on its behalf of which the Company is aware) which is in violation of law or (iv) violated in any material respect any provision of FCPA.
  
 (y) Acknowledgment Regarding Purchasers’ Purchase of Securities. The Company acknowledges and agrees that each of the Purchasers is acting solely in the capacity of an arm’s length purchaser with respect to the Transaction Documents and the transactions contemplated thereby. The Company further acknowledges that no Purchaser is acting as a financial advisor or fiduciary of the Company (or in any similar capacity) with respect to the Transaction Documents and the transactions contemplated thereby and any advice given by any Purchaser or any of their respective representatives or agents in connection with the Transaction Documents and the transactions contemplated thereby is merely incidental to the Purchasers’ purchase of the Securities. The Company further represents to each Purchaser that the Company’s decision to enter into this Agreement and the other Transaction Documents has been based solely on the independent evaluation of the transactions contemplated hereby by the Company and its representatives.
  
 (z) Money Laundering. The operations of the Company and its Subsidiaries are and have been conducted at all times in compliance with applicable financial record-keeping and reporting requirements of the Currency and Foreign Transactions Reporting Act of 1970, as amended, applicable money laundering statutes and applicable rules and regulations thereunder (collectively, the “Money Laundering Laws”), and no action, suit or proceeding by or before any court or governmental agency, authority or body or any arbitrator involving the Company or any Subsidiary with respect to the Money Laundering Laws is pending or, to the knowledge of the Company or any Subsidiary, threatened.
  
  	 
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 (aa) Office of Foreign Assets Control. Neither the Company nor any Subsidiary nor, to the Company's knowledge, any director, officer, agent, employee or affiliate of the Company is currently subject to any U.S. sanctions administered by the Office of Foreign Assets Control of the U.S. Treasury Department (“OFAC”).
  
 (bb) Private Placement. Assuming the accuracy of the Purchasers’ representations and warranties set forth in Section 3.2, no registration under the Securities Act is required for the offer and sale of the Securities by the Company to the Purchasers as contemplated hereby.
  
 (cc) No General Solicitation. To the best knowledge of the Company, neither the Company nor any person acting on behalf of the Company has offered or sold any of the Securities by any form of general solicitation or general advertising. To the best knowledge of the Company, the Company has offered the Securities for sale only to the Purchasers and certain other “accredited investors” within the meaning of Rule 501 under the Securities Act.
  
 (dd) Indebtedness and Seniority. As of the date hereof, all Indebtedness and Liens are as set forth on the Financial Statements. Except as set forth on the Financial Statements, as of the Closing Date, no Indebtedness, equity, Common Stock Equivalent is senior to the Notes in right of payment, whether with respect to interest or upon liquidation or dissolution, or otherwise, and capital lease obligations (which is senior only as to the property covered thereby).
  
 (ee) No Disqualification Events. None of the Company, any of its predecessors, any affiliated issuer, any director, executive officer, other officer of the Company participating in the offering hereunder, any beneficial owner of 20% or more of the Company’s outstanding voting equity securities, calculated on the basis of voting power, nor any promoter (as that term is defined in Rule 405 under the Securities Act) connected with the Company in any capacity at the time of sale (each, an “Issuer Covered Person” and, together, “Issuer Covered Persons”) is subject to any of the “Bad Actor” disqualifications described in Rule 506(d)(1)(i) to (viii) under the Securities Act (a “Disqualification Event”), except for a Disqualification Event covered by Rule 506(d)(2) or (d)(3). The Company has exercised reasonable care to determine whether any Issuer Covered Person is subject to a Disqualification Event. The Company has complied, to the extent applicable, with its disclosure obligations under Rule 506(e), and has furnished to the Purchasers a copy of any disclosures provided thereunder. The Company will notify the Purchasers in writing, prior to the Closing Date of (i) any Disqualification Event relating to any Issuer Covered Person and (ii) any event that would, with the passage of time, become a Disqualification Event relating to any Issuer Covered Person.
  
 (ff) Reporting Company/Shell Company. The Company is a publicly-held company subject to reporting obligations pursuant to Sections 12(g) and 13 of the Exchange Act. Pursuant to the provisions of the Exchange Act, the Company has timely filed all reports and other materials required to be filed by the Company thereunder with the Commission during the preceding twelve months, except for reports on Form 8-K. As of the Closing Date, the Company is not a “shell company” as that term is employed in Rule 144 under the Securities Act. The Company is a former shell company but has met each of the requirements under Rule 144(i)(2). The Company is and has no reason to believe that it will not in the foreseeable future continue to be in compliance with all such listing and maintenance requirements.
  
 (gg) Survival. The foregoing representations and warranties shall survive the Closing Date.
  
 3.2 Representations and Warranties of the Purchasers. Each Purchaser, for itself and for no other Purchaser, hereby represents and warrants as of the date hereof and as of the Closing Date to the Company as follows (unless as of a specific date therein):
  
 (a) Organization; Authority. Such Purchaser is either an individual or an entity duly incorporated or formed, validly existing and in good standing under the laws of the jurisdiction of its incorporation or formation with full right, corporate, partnership, limited liability company or similar power and authority to enter into and to consummate the transactions contemplated by the Transaction Documents and otherwise to carry out its obligations hereunder and thereunder. The execution and delivery of the Transaction Documents and performance by such Purchaser of the transactions contemplated by the Transaction Documents have been duly authorized by all necessary corporate, partnership, limited liability company or similar action, as applicable, on the part of such Purchaser. Each Transaction Document to which it is a party has been duly executed by such Purchaser, and when delivered by such Purchaser in accordance with the terms hereof, will constitute the valid and legally binding obligation of such Purchaser, enforceable against it in accordance with its terms, except: (i) as limited by general equitable principles and applicable bankruptcy, insolvency, reorganization, moratorium and other laws of general application affecting enforcement of creditors’ rights generally, (ii) as limited by laws relating to the availability of specific performance, injunctive relief or other equitable remedies and (iii) to the extent the indemnification provisions contained in this Agreement may be limited by applicable law.
  
  	 
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 (b) Understandings or Arrangements. Such Purchaser understands that the Securities are “restricted securities” and have not been registered under the Securities Act or any applicable state securities law and is acquiring the Securities as principal for its own account and not with a view to or for distributing or reselling such Securities or any part thereof in violation of the Securities Act or any applicable state securities law, has no present intention of distributing any of such Securities in violation of the Securities Act or any applicable state securities law and has no direct or indirect arrangement or understandings with any other persons to distribute or regarding the distribution of such Securities in violation of the Securities Act or any applicable state securities law (this representation and warranty not limiting such Purchaser’s right to sell the Securities pursuant to a registration statement or otherwise in compliance with applicable federal and state securities laws). Such Purchaser is acquiring the Securities hereunder in the ordinary course of its business.
  
 (c) Purchaser Status. At the time such Purchaser was offered the Securities, it was, and as of the date hereof it is, and on each date on which it converts a Note, it will be either: (i) an “accredited investor” as defined in Rule 501(a)(1), (a)(2), (a)(3), (a)(7) or (a)(8) under the Securities Act or (ii) a “qualified institutional buyer” as defined in Rule 144A(a) under the Securities Act. Such Purchaser is not required to be registered as a broker-dealer under Section 15 of the Exchange Act. Such Purchaser has the authority and is duly and legally qualified to purchase and own the Securities. Such Purchaser is able to bear the risk of such investment for an indefinite period and to afford a complete loss thereof.
  
 (d) Experience of Such Purchaser. Such Purchaser, either alone or together with its representatives, has such knowledge, sophistication and experience in business and financial matters so as to be capable of evaluating the merits and risks of the prospective investment in the Securities, and has so evaluated the merits and risks of such investment. Such Purchaser is able to bear the economic risk of an investment in the Securities and, at the present time, is able to afford a complete loss of such investment.
  
 (e) Information on Company. Purchasers are not deemed to have any knowledge of any information not included in the Financial Statements or the Transaction Documents unless such information is delivered in the manner described in the next sentence. Each Purchaser was afforded (i) the opportunity to ask such questions as such Purchaser deemed necessary of, and to receive answers from, representatives of the Company concerning the merits and risks of acquiring the Securities; (ii) the right of access to information about the Company and its financial condition, results of operations, business, properties, management and prospects sufficient to enable such Purchaser to evaluate the Securities; and (iii) the opportunity to obtain such additional information that the Company possesses or can acquire without unreasonable effort or expense that is necessary to make an informed investment decision with respect to acquiring the Securities. In addition, such Purchaser may have received in writing from the Company such other information concerning its operations, financial condition and other matters as such Purchaser has requested, identified thereon as OTHER WRITTEN INFORMATION (such other information is collectively, the “Other Written Information”), and considered all factors such Purchaser deems material in deciding on the advisability of investing in the Securities.
  
 (f) Compliance with Securities Act; Reliance on Exemptions. Such Purchaser understands and agrees that the Securities have not been registered under the 1933 Act or any applicable state securities laws, by reason of their issuance in a transaction that does not require registration under the 1933 Act, and that such Securities must be held indefinitely unless a subsequent disposition is registered under the 1933 Act or any applicable state securities laws or is exempt from such registration. Such Purchaser understands and agrees that the Securities are being offered and sold to such Purchaser in reliance on specific exemptions from the registration requirements of United States federal and state securities laws and regulations and that the Company is relying in part upon the truth and accuracy of, and such Purchaser’s compliance with, the representations, warranties, agreements, acknowledgments and understandings of such Purchaser set forth herein in order to determine the availability of such exemptions and the eligibility of such Purchaser to acquire the Securities.
  
 (g) Communication of Offer. Such Purchaser is not purchasing the Securities as a result of any “general solicitation” or “general advertising,” as such terms are defined in Regulation D, which includes, but is not limited to, any advertisement, article, notice or other communication regarding the Securities published in any newspaper, magazine or similar media or on the internet or broadcast over television, radio or the internet or presented at any seminar or any other general solicitation or general advertisement.
  
  	 
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 (h) No Governmental Review. Such Purchaser understands that no United States federal or state agency or any other governmental or state agency has passed on or made recommendations or endorsement of the Securities or the suitability of the investment in the Securities nor have such authorities passed upon or endorsed the merits of the offering of the Securities.
  
 (i) No Conflicts. The execution, delivery and performance of this Agreement and performance under the other Transaction Documents and the consummation by such Purchaser of the transactions contemplated hereby and thereby or relating hereto or thereto do not and will not (i) result in a violation of such Purchaser’s charter documents, bylaws or other organizational documents, if applicable, (ii) conflict with nor constitute a default (or an event which with notice or lapse of time or both would become a default) under any agreement to which such Purchaser is a party, nor (iii) result in a violation of any law, rule, or regulation, or any order, judgment or decree of any court or governmental agency applicable to such Purchaser or its properties (except for such conflicts, defaults and violations as would not, individually or in the aggregate, have a material adverse effect on such Purchaser). Such Purchaser is not required to obtain any consent, authorization or order of, or make any filing or registration with, any court or governmental agency in order for it to execute, deliver or perform any of its obligations under this Agreement or perform under the other Transaction Documents nor to purchase the Securities in accordance with the terms hereof, provided that for purposes of the representation made in this sentence, such Purchaser is assuming and relying upon the accuracy of the relevant representations and agreements of the Company herein.
  
 (j) Survival. The foregoing representations and warranties shall survive the Closing Date for 30 days.
  
 3.3 Reliance. The Company acknowledges and agrees that the representations contained in Section 3.2 shall not modify, amend or affect such Purchaser’s right to rely on the Company’s representations and warranties contained in this Agreement or any representations and warranties contained in any other Transaction Document or any other document or instrument executed and/or delivered in connection with this Agreement or the consummation of the transaction contemplated hereby.
  
 ARTICLE IV. 
 OTHER AGREEMENTS OF THE PARTIES
  
 4.1 Transfer Restrictions.
  
 (a) Disposition of Securities. The Securities may only be disposed of in compliance with state and federal securities laws. In connection with any transfer of Securities other than pursuant to an effective registration statement or Rule 144, to the Company or to an Affiliate of a Purchaser or in connection with a pledge as contemplated in Section 4.1(c), the Company may require the transferor thereof to provide to the Company at the Company’s expense, an opinion of counsel selected by the transferor and reasonably acceptable to the Company, the form and substance of which opinion shall be reasonably satisfactory to the Company, to the effect that such transfer does not require registration of such transferred Securities under the Securities Act. As a condition of transfer, any such transferee shall agree in writing to be bound by the terms of this Agreement and shall have the rights and obligations of a Purchaser under the Transaction Documents and registration statement, if any.
  
 (b) Legend. The Purchasers agree to the imprinting, so long as is required by this Section 4.1, of a legend on any of the Securities in the following form:
  
 [NEITHER] THIS SECURITY [NOR THE SECURITIES INTO WHICH THIS SECURITY IS [EXERCISABLE] [CONVERTIBLE]] HAS [NOT] BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE IN RELIANCE UPON AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS AS EVIDENCED BY A LEGAL OPINION OF COUNSEL TO THE TRANSFEROR TO SUCH EFFECT, THE SUBSTANCE OF WHICH SHALL BE REASONABLY ACCEPTABLE TO THE COMPANY. THIS SECURITY [AND THE SECURITIES ISSUABLE UPON [EXERCISE] [CONVERSION] OF THIS SECURITY] MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT WITH A REGISTERED BROKER-DEALER OR OTHER LOAN WITH A FINANCIAL INSTITUTION THAT IS AN “ACCREDITED INVESTOR” AS DEFINED IN RULE 501(a) UNDER THE SECURITIES ACT OR OTHER LOAN SECURED BY SUCH SECURITIES.
  
  	 
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 (c) Pledge. The Company acknowledges and agrees that a Purchaser may from time to time pledge pursuant to a bona fide margin agreement with a registered broker-dealer or grant a security interest in some or all of the Securities to a financial institution that is an “accredited investor” as defined in Rule 501(a) under the Securities Act and who agrees to be bound by the provisions of this Agreement and, if required under the terms of such arrangement, such Purchaser may transfer pledge or secure Securities to the pledgees or secured parties. Such a pledge or transfer would not be subject to approval of the Company and no legal opinion of legal counsel of the pledgee, secured party or pledgor shall be required in connection therewith. At such Purchaser’s expense, the Company will execute and deliver such reasonable documentation as a pledgee or secured party of Securities may reasonably request in connection with a pledge or transfer of the Securities, including, if the Securities are subject to registration pursuant to the registration statement, the preparation and filing of any required prospectus supplement under Rule 424(b)(3) under the Securities Act or other applicable provision of the Securities Act to appropriately amend the list of selling stockholders thereunder.
  
 (d) Legend Removal. Certificates evidencing the Underlying Shares shall not contain any legend (“Unlegended Shares”) (including the legend set forth in Section 4.1(b) hereof): (i) while a registration statement covering the resale of such security is effective under the Securities Act, (ii) following any sale of such Underlying Shares pursuant to Rule 144, (iii) if such Underlying Shares are eligible for sale under Rule 144, without the requirement for the Company to be in compliance with the current public information required under Rule 144 as to such Underlying Shares and without volume or manner-of-sale restrictions or (iv) if such legend is not required under applicable requirements of the Securities Act (including judicial interpretations and pronouncements issued by the staff of the Commission). The Company shall cause its counsel to issue a legal opinion to the Transfer Agent during the time any of the aforedescribed conditions apply, to effect the removal of the legend hereunder; provided that the holder of the restricted shares reasonably cooperates with counsel for the Company in providing information for the preparation and issuance of the legal opinion to review the legend hereunder. If all or any Notes are converted at a time when there is an effective registration statement to cover the resale of the corresponding Underlying Shares, or if such Underlying Shares may be sold under Rule 144 or if such legend is not otherwise required under applicable requirements of the Securities Act (including judicial interpretations and pronouncements issued by the staff of the Commission) then such Underlying Shares shall be issued free of all legends. The Company agrees that following such time as such legend is no longer required under this Section 4.1(d), it will, no later than five Trading Days following the delivery by the Purchaser to the Company or the Transfer Agent of a certificate representing Underlying Shares, as applicable, issued with a restrictive legend (such fifth Trading Day, the “Legend Removal Date”), deliver or cause to be delivered to such Purchaser a certificate representing such shares that is free from all restrictive and other legends (however, the Corporation shall use reasonable best efforts to deliver such shares within three (3) Trading Days). The Company may not make any notation on its records or give instructions to the Transfer Agent that enlarge the restrictions on transfer set forth in this Section 4.1. Certificates for Underlying Shares subject to legend removal hereunder shall be transmitted by the Transfer Agent to the Purchaser by crediting the account of the Purchaser’s prime broker with the Depository Trust Company System as directed by such Purchaser.
  
 (e) Legend Removal Default. In addition to such Purchaser’s other available remedies, provided the conditions for legend removal set forth in Section 4.1(d) exist, the Company shall pay to a Purchaser, in cash, as partial liquidated damages and not as a penalty, for each $1,000 of Underlying Shares (based on the higher of the actual purchase price of the Common Stock on the date such Securities are submitted to the Transfer Agent) delivered for removal of the restrictive legend and subject to Section 4.1(d), $10 per Trading Day for each Trading Day after the Legend Removal Date (increasing to $20 per Trading Day after the fifth Trading Day) until such certificate is delivered without a legend. Nothing herein shall limit such Purchaser’s right to pursue actual damages for the Company’s failure to deliver certificates representing any Securities as required by the Transaction Documents, and such Purchaser shall have the right to pursue all remedies available to it at law or in equity including, without limitation, a decree of specific performance and/or injunctive relief.
  
 (f) DWAC. Commencing after the Closing, in lieu of delivering physical certificates representing the Unlegended Shares, upon request of a Purchaser, so long as the certificates therefor do not bear a legend and the Purchaser is not obligated to return such certificate for the placement of a legend thereon, the Company shall cause its transfer agent to electronically transmit the Unlegended Shares by crediting the account of Purchaser’s prime broker with the Depository Trust Company through its Deposit Withdrawal At Custodian system, provided that the Company’s Common Stock is DTC eligible and the Company’s transfer agent participates in the Deposit Withdrawal at Custodian system. Such delivery must be made on or before the Legend Removal Date.
  
 (g) Resale Requirements. Each Purchaser, severally and not jointly with the other Purchasers, agrees with the Company that such Purchaser will sell the Securities pursuant to either the registration requirements of the Securities Act, including any applicable prospectus delivery requirements, or an exemption therefrom, and that if Securities are sold pursuant to a registration statement, they will be sold in compliance with the plan of distribution set forth therein, and acknowledges that the removal of the restrictive legend from certificates representing Securities as set forth in this Section 4.1 is predicated upon the Company’s reliance upon this understanding.
  
  	 
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 (h) Remedies. In addition to such Purchaser’s other available remedies, the Company shall pay to a Purchaser, in cash, as partial liquidated damages and not as a penalty, for each $1,000 of Conversion Shares delivered for removal of the restrictive legend and Conversion Shares delivered for conversion into Shares, $10 per Trading Day for each Trading Day, but not to exceed an aggregate of $250 per Trading Day, following the Legend Removal Date or the date such Securities are to be delivered pursuant to the Note until such Common Stock certificate is delivered without a legend pursuant to Section 4.1(d) or such Conversion Shares. Nothing herein shall limit such Purchaser’s right to elect in lieu of the aforedescribed liquidated damages to pursue actual damages for the Company’s failure to deliver certificates representing any Underlying Shares as required by the Transaction Documents, and such Purchaser shall have the right to pursue all remedies available to it at law or in equity including, without limitation, a decree of specific performance and/or injunctive relief.
  
 (i) Injunction. In the event a Purchaser shall request delivery of Securities as described in this Section 4.1 or Common Stock pursuant to the Note and the Company is required to deliver such Securities, the Company may not refuse to deliver Securities based on any claim that such Purchaser or anyone associated or affiliated with such Purchaser has not complied with Purchaser’s obligations under the Transaction Documents, or for any other reason, unless, an injunction or temporary restraining order from a court, on notice, restraining and or enjoining delivery of such unlegended shares shall have been sought and obtained by the Company and the Company has posted a surety bond for the benefit of such Purchaser in the amount of 120% of the amount of the aggregate purchase price of the Securities intended to be subject to the injunction or temporary restraining order, which bond shall remain in effect until the completion of arbitration/litigation of the dispute and the proceeds of which shall be payable to such Purchaser to the extent Purchaser obtains judgment in Purchaser’s favor.
  
 (j) Buy-In. In addition to any other rights available to Purchaser, if the Company fails to deliver to a Purchaser Securities as required pursuant to this Agreement or the Note and after the Legend Removal Date or required delivery date pursuant to the Note the Purchaser, or a broker on the Purchaser’s behalf, purchases (in an open market transaction or otherwise) shares of Common Stock to deliver in satisfaction of a sale by such Purchaser of the shares of Common Stock which the Purchaser was entitled to receive in unlegended form from the Company (a “Buy-In”), then the Company shall promptly pay in cash to the Purchaser (in addition to any remedies available to or elected by the Purchaser) the amount, if any, by which (A) the Purchaser’s total purchase price (including brokerage commissions, if any) for the shares of Common Stock so purchased exceeds (B) the aggregate purchase price of the shares of Common Stock delivered to the Company for reissuance as unlegended Shares or as are required to be delivered pursuant to the Note, as the case may be, together with interest thereon at a rate of 15% per annum accruing until such amount and any accrued interest thereon is paid in full (which amount shall be paid as liquidated damages and not as a penalty). For example, if a Purchaser purchases shares of Common Stock having a total purchase price of $11,000 to cover a Buy-In with respect to $10,000 of purchase price of Shares delivered to the Company for reissuance as unlegended shares, the Company shall be required to pay the Purchaser $1,000, plus interest, if any. The Purchaser shall provide the Company written notice indicating the amounts payable to the Purchaser in respect of the Buy-In.
  
 4.2 Acknowledgment of Dilution. The Company acknowledges that the issuance of the Securities may result in dilution of the outstanding shares of Common Stock, which dilution may be substantial under certain market conditions. The Company further acknowledges that its obligations under the Transaction Documents, including, without limitation, its obligation to issue the Underlying Shares pursuant to the Transaction Documents, are unconditional and absolute and not subject to any right of set off, counterclaim, delay or reduction, regardless of the effect of any such dilution or any claim the Company may have against any Purchaser and regardless of the dilutive effect that such issuance may have on the ownership of the other stockholders of the Company.
  
 4.3 Furnishing of Information.
  
 (a) At any time commencing on the Closing Date and ending at the earliest of the time that no Purchaser owns Securities, the Company covenants to file all periodic reports with the Commission pursuant to Section 15(d) of the Exchange Act and under Section 12(b) or 12(g) of the 1934 Act, maintain the registration of the Common Stock under Section 12(b) or 12(g) of the Exchange Act and, except for reports on Form 8-K, to timely file (or obtain extensions in respect thereof and file within the applicable grace period) all reports required to be filed by the Company after the date hereof pursuant to the Exchange Act even if the Company is not then subject to the reporting requirements of the Exchange Act.
  
  	 
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 (b) At any time commencing on the Closing Date and ending at such time that all of the Securities may be sold without the requirement for the Company to be in compliance with Rule 144(c)(1) and otherwise without restriction or limitation pursuant to Rule 144, if the Company shall fail for any reason to satisfy the current public information requirement under Rule 144(c) (a “Public Information Failure”), then, in addition to such Purchaser’s other available remedies, the Company shall pay to a Purchaser, in cash, as partial liquidated damages and not as a penalty, by reason of any such delay in or reduction of its ability to sell the Securities, an amount in cash equal to two percent (2.0%) of the aggregate principal amount of Notes and accrued interest held by such Purchaser on the day of a Public Information Failure and on every thirtieth (30th) day (pro-rated for periods totaling less than thirty days) thereafter until the earlier of (a) the date such Public Information Failure is cured and (b) such time that such public information is no longer required for the Purchasers to transfer the Underlying Shares pursuant to Rule 144. The payments to which a Purchaser shall be entitled pursuant to this Section 4.3(b) are referred to herein as “Public Information Failure Payments.” Public Information Failure Payments shall be paid on the earlier of (i) the last day of the calendar month during which such Public Information Failure Payments are incurred and (ii) the third (3rd) Business Day after the event or failure giving rise to the Public Information Failure Payments is cured. In the event the Company fails to make Public Information Failure Payments in a timely manner, such Public Information Failure Payments shall bear interest at the rate of 1.5% per month (prorated for partial months) until paid in full. Nothing herein shall limit such Purchaser’s right to pursue actual damages for the Public Information Failure, and such Purchaser shall have the right to pursue all remedies available to it at law or in equity including, without limitation, a decree of specific performance and/or injunctive relief.
  
 4.4 Conversion and Exercise Procedures. Each of the form of Notice of Conversion attached to the Note sets forth the totality of the procedures required of the Purchasers in order to convert the Note. No additional legal opinion, other information or instructions shall be required of the Purchasers to convert their Note. The Company shall honor conversions of the Note and shall deliver Underlying Shares in accordance with the terms, conditions and time periods set forth in the Transaction Documents.
  
 4.5 Use of Proceeds. The proceeds of the offering will be employed by the Company for general operating expenses, and for the costs of this loan transaction.
  
 4.6 Indemnification of Purchasers. Subject to the provisions of this Section 4.6, the Company will indemnify and hold each Purchaser and its directors, officers, shareholders, members, partners, employees and agents (and any other Persons with a functionally equivalent role of a Person holding such titles notwithstanding a lack of such title or any other title), each Person who controls such Purchaser (within the meaning of Section 15 of the Securities Act and Section 20 of the Exchange Act), and the directors, officers, shareholders, agents, members, partners or employees (and any other Persons with a functionally equivalent role of a Person holding such titles notwithstanding a lack of such title or any other title) of such controlling persons (each, a “Purchaser Party”) harmless from any and all losses, liabilities, obligations, claims, contingencies, damages, costs and expenses, including all judgments, amounts paid in settlements, court costs and reasonable attorneys’ fees and costs of investigation that any such Purchaser Party may suffer or incur as a result of or relating to (a) any breach of any of the representations, warranties, covenants or agreements made by the Company in this Agreement or in the other Transaction Documents or (b) any action instituted against Purchaser Parties in any capacity, or any of them or their respective Affiliates, by any stockholder of the Company who is not an Affiliate of such Purchaser Party, with respect to any of the transactions contemplated by the Transaction Documents (unless such action is based upon a breach of such Purchaser Party’s representations, warranties or covenants under the Transaction Documents or any agreements or understandings such Purchaser Party may have with any such stockholder or any violations by such Purchaser Party of state or federal securities laws or any conduct by such Purchaser Party which constitutes fraud, gross negligence, willful misconduct or malfeasance). If any action shall be brought against any Purchaser Party in respect of which indemnity may be sought pursuant to this Agreement, such Purchaser Party shall promptly notify the Company in writing, and the Company shall have the right to assume the defense thereof with counsel of its own choosing reasonably acceptable to the Purchaser Party. Any Purchaser Party shall have the right to employ separate counsel in any such action and participate in the defense thereof, but the fees and expenses of such counsel shall be at the expense of such Purchaser Party except to the extent that (i) the employment thereof has been specifically authorized by the Company in writing, (ii) the Company has failed after a reasonable period of time to assume such defense and to employ counsel or (iii) in such action there is, in the reasonable opinion of counsel, a material conflict on any material issue between the position of the Company and the position of such Purchaser Party, in which case the Company shall be responsible for the reasonable fees and expenses of no more than one such separate counsel. The Company will not be liable to any Purchaser Party under this Agreement (y) for any settlement by a Purchaser Party effected without the Company’s prior written consent, which shall not be unreasonably withheld or delayed; or (z) to the extent, but only to the extent that a loss, claim, damage or liability is attributable to any Purchaser Party’s breach of its representations, warranties or covenants under the Transaction Documents. The indemnification required by this Section 4.6 shall be made by periodic payments of the amount thereof during the course of the investigation or defense, as and when bills are received or are incurred. The indemnity agreements contained herein shall be in addition to any cause of action or similar right of any Purchaser Party against the Company or others and any liabilities the Company may be subject to pursuant to law.
  
  	 
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 4.7 Reservation and Listing of Securities.
  
 (a) The Company shall maintain a reserve from its duly authorized shares of Common Stock for issuance pursuant to the Transaction Documents in such amount as may then be required to fulfill its obligations in full under the Transaction Documents, but not less than the Required Minimum.
  
 (b) If, on any date, the number of authorized but unissued (and otherwise unreserved) shares of Common Stock is less than the Required Minimum on such date, then the Board of Directors shall amend the Company’s certificate or articles of incorporation to increase the number of authorized but unissued shares of Common Stock to at least the Required Minimum at such time, as soon as possible and in any event not later than the 60th day after such date. In the event of a shortfall in the Required Minimum, any shares reserved for issuance to the Company’s officers and directors (not including Purchasers, if applicable) will be made available for issuance to the Purchasers.
  
 4.8 Form D; Blue Sky Filings. The Company agrees to timely file a Form D with respect to the Securities as required under Regulation D and to provide a copy thereof, promptly upon request of any Purchaser. The Company shall take such action as the Company shall reasonably determine is necessary in order to obtain an exemption for, or to qualify the Securities for, sale to the Purchasers at the Closing under applicable securities or “Blue Sky” laws of the states of the United States, and shall provide evidence of such actions promptly upon request of any Purchaser.
  
 4.9 Most Favored Nation Provision. From the date hereof and for so long as a Purchaser holds any Securities, in the event that the Company issues or sells any Common Stock or Common Stock Equivalents, if a Purchaser then holding outstanding Securities reasonably believes that any of the terms and conditions appurtenant to such issuance or sale are more favorable to such investors than are the terms and conditions granted to the Purchasers hereunder, upon notice to the Company by such Purchaser, the Company shall amend the terms of this transaction as to such Purchaser only so as to give such Purchaser the benefit of such more favorable terms or conditions. This Section 4.9 shall not apply with respect to an Exempt Issuance. The Company shall provide each Purchaser with notice of any such issuance or sale not later than ten (10) Trading Days before such issuance or sale.
  
 4.10 Equal Treatment of Purchasers. No consideration (including any modification of any Transaction Document) shall be offered or paid to any Person to amend or consent to a waiver or modification of any provision of any of the Transaction Documents unless the same or substantially similar consideration is also offered, mutatis mutandis, on a ratable basis to all of the parties to this Agreement. For clarification purposes, this provision constitutes a separate right granted to each Purchaser by the Company and negotiated separately by each Purchaser and is intended for the Company to treat the Purchasers as a class and shall not in any way be construed as the Purchasers acting in concert or as a group with respect to the purchase, disposition or voting of Securities or otherwise. This section shall not apply to the Company’s rights under Section 4.21 below.
  
 4.11 Integration. The Company shall not sell, offer for sale or solicit offers to buy or otherwise negotiate in respect of any security (as defined in Section 2 of the Securities Act) that would be integrated with the offer or sale of the Securities in a manner that would require the registration under the Securities Act of the sale or resale of the Securities.
  
 4.12 Capital Raises. The Company shall not raise any additional capital for 60 days after the Closing Date.
  
 4.13 Preservation of Corporate Existence. Until the End Date, the Company shall preserve and maintain its corporate existence, rights, privileges and franchises in the jurisdiction of its incorporation, and qualify and remain qualified, as a foreign corporation in each jurisdiction in which such qualification is necessary in view of its business or operations and where the failure to qualify or remain qualified might reasonably have a Material Adverse Effect upon the financial condition, business or operations of the Company taken as a whole.
  
  	 
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 4.14 Shareholder Rights Plan. No claim will be made or enforced by the Company or, with the consent of the Company, any other Person, that any Purchaser is an “Acquiring Person” under any control share acquisition, business combination, poison pill (including any distribution under a rights agreement) or similar anti-takeover plan or arrangement in effect or hereafter adopted by the Company, or that any Purchaser could be deemed to trigger the provisions of any such plan or arrangement, by virtue of receiving Securities under the Transaction Documents.
  
 4.15 Reimbursement. If any Purchaser becomes involved in any capacity in any Proceeding by or against any Person who is a stockholder of the Company (except as a result of sales, pledges, margin sales and similar transactions by such Purchaser to or with any current stockholder), solely as a result of such Purchaser’s acquisition of the Securities under this Agreement, the Company will reimburse such Purchaser for its reasonable legal and other expenses (including the cost of any investigation preparation and travel in connection therewith) incurred in connection therewith, as such expenses are incurred. The reimbursement obligations of the Company under this paragraph shall be in addition to any liability which the Company may otherwise have, shall extend upon the same terms and conditions to any Affiliates of the Purchasers who are actually named in such action, proceeding or investigation, and partners, directors, agents, employees and controlling persons (if any), as the case may be, of the Purchasers and any such Affiliate, and shall be binding upon and inure to the benefit of any successors, assigns, heirs and personal representatives of the Company, the Purchasers and any such Affiliate and any such Person. The Company also agrees that neither the Purchasers nor any such Affiliates, partners, directors, agents, employees or controlling persons shall have any liability to the Company or any Person asserting claims on behalf of or in right of the Company solely as a result of acquiring the Securities under this Agreement.
  
 4.16 Securities Laws Disclosure; Publicity. The Company shall, within four Business Days following the Closing Date, issue a press release disclosing the material terms of the transactions contemplated hereby, and shall file a Current Report on Form 8-K including the Transaction Documents as exhibits thereto (the “Closing Form 8-K” mutatis mutandem) within four Business Days of the date hereof.
  
 4.17 ROFRs. If the Company proposes to offer or sell any securities (“New Securities”) while the Notes are outanding, the Company shall first offer such New Securities to the Purchasers. A Purchaser shall be entitled to apportion the right of first offer hereby granted to it among itself and its Affiliates in such proportions as it deems appropriate. The Company shall give notice (the “Offer Notice”) to each Purchaser, stating (i) its bona fide intention to offer such New Securities, (ii) the number of such New Securities to be offered, and (iii) the price and terms, if any, upon which it proposes to offer such New Securities. By notification to the Company within five (5) days after the Offer Notice is given, each Purchaser may elect to purchase or otherwise acquire, at the price and on the terms specified in the Offer Notice, up to that portion of the New Securities which equals the proportion that the Common Stock issued and held, or issuable (directly or indirectly) upon conversion of the Notes then held by such Purchaser relative to the other Purchasers. At the expiration of such five (5) day period, the Company shall promptly notify each Purchaser that elects to purchase or acquire all the shares available to it (each, a “Fully Exercising Investor”) of any other Purchaser’s failure to do likewise. During the five (5) day period commencing after the Company has given such notice, each Fully Exercising Investor may, by giving notice to the Company, elect to purchase or acquire, in addition to the number of shares specified above, up to that portion of the New Securities for which Purchasers were entitled to subscribe but that were not subscribed for by the Purchasers which is equal to the proportion that the Common Stock issued and held, or issuable (directly or indirectly) upon conversion of the Notes, by such Fully Exercising Investor bears to the Common Stock issued and held, or issuable (directly or indirectly) upon conversion of the Notes then held by all Fully Exercising Investors who wish to purchase such unsubscribed shares. The closing of any sale pursuant to this Section shall occur within the later of twenty (20) days of the date that the Offer Notice is given and the date of initial sale of New Securities pursuant to this section. If all New Securities referred to in the Offer Notice are not elected to be purchased or acquired as provided in this Section, the Company may, during the twenty (20) day period following the expiration of the periods provided in this Section, offer and sell the remaining unsubscribed portion of such New Securities to any Person or Persons at a price not less than, and upon terms no more favorable to the offeree than, those specified in the Offer Notice. If the Company does not enter into an agreement for the sale of such New Securities within such period, or if such agreement is not consummated within twenty (20) days of the execution thereof, the right provided hereunder shall be deemed to be revived and such New Securities shall not be offered unless first reoffered to the Purchasers in accordance with this Section.
  
 4.18 Subsequent Equity Sales. Until six (6) months after the final Closing Date, the Company will not issue any Common Stock or Common Stock Equivalents to officers, directors, employees, consultants and service providers of the Company except consistent with past practices. For so long as the Notes are outstanding, the Company will not amend the terms of any securities or Common Stock Equivalents or of any agreement outstanding or in effect as of the date of this Agreement or at any time thereafter, pursuant to which same were or may be acquired, if such issuance or the result of such amendment would be at an effective price per share of Common Stock less than the Conversion Price in effect at the time of such amendment.
  
  	 
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 4.19 Non-Public Information. Except with respect to the material terms and conditions of the transactions contemplated by the Transaction Documents, the Company covenants and agrees that neither it, nor any other Person acting on its behalf, will provide any Purchaser or its agents or counsel with any information that the Company believes constitutes material non-public information, unless prior thereto such Purchaser shall have entered into a written agreement with the Company regarding the confidentiality and use of such information. The Company understands and confirms that each Purchaser shall be relying on the foregoing covenant in effecting transactions in securities of the Company.
  
 4.20 Par Value. In the event the Conversion Price of the Notes is reduced below the par value of the common stock, the Company shall promptly thereafter, reduce the par value of its common stock so that the Conversion Price shall be greater than the par value of the Common Stock.
  
 4.21 Due Diligence Shares. For so long as any Securities are outstanding, every time the Company issues shares of its common stock or common stock equivalents, as any form of fee or incentive, in connection with any funding, which results in the issuance of more shares der dollar invested than the number of shares issued to the Purchasers pursuant to this Agreement (“Dilutive Shares Issuance”), then the Due Diligence Share Ratio will be revised to match such Dilutive Shares Issuance and the Company shall issue to each Purchaser a number of Shares equal to the difference of the number of shares issuable under the revised Due Diligence Share Ratio less the number of Due Diligence Shares issued at the Closing or under a previous application of this Section.
  
 ARTICLE V. 
 MISCELLANEOUS
  
 5.1 Termination. This Agreement may be terminated by any Purchaser, as to such Purchaser’s obligations hereunder only and without any effect whatsoever on the obligations between the Company and the other Purchasers, by written notice to the other parties, if the Closing has not been consummated on or before September 30, 2018; provided, however, that such termination will not affect the right of any party to sue for any breach by any other party or parties.
  
 5.2 Fees and Expenses. Each party shall pay the fees and expenses of its advisers, counsel, accountants and other experts, if any, and all other expenses incurred by such party incident to the negotiation, preparation, execution, delivery and performance of this Agreement, except the Company shall pay $1,000 towards the Purchasers’ legal fees in preparation of the Transaction Documents. The Company shall pay all Transfer Agent fees, stamp taxes and other taxes and duties levied in connection with the delivery of any Securities to the Purchasers.
  
 5.3 Entire Agreement. The Transaction Documents, together with the exhibits and schedules thereto, contain the entire understanding of the parties with respect to the subject matter hereof and thereof and supersede all prior agreements and understandings, oral or written, with respect to such matters, which the parties acknowledge have been merged into such documents, exhibits and schedules.
  
 5.4 Notices. All notices, demands, requests, consents, approvals, and other communications required or permitted hereunder shall be in writing and, unless otherwise specified herein, shall be (i) personally served, (ii) deposited in the mail, registered or certified, return receipt requested, postage prepaid, (iii) delivered by reputable air courier service with charges prepaid, or (iv) transmitted by hand delivery, telegram, or facsimile, addressed as set forth below or to such other address as such party shall have specified most recently by written notice. Any notice or other communication required or permitted to be given hereunder shall be deemed effective (a) upon hand delivery or delivery by facsimile, with accurate confirmation generated by the transmitting facsimile machine, at the address or number designated below (if delivered on a Business Day during normal business hours where such notice is to be received), or the first Business Day following such delivery (if delivered other than on a Business Day during normal business hours where such notice is to be received) or (b) on the second Business Day following the date of mailing by express courier service, fully prepaid, addressed to such address, or upon actual receipt of such mailing, whichever shall first occur. The addresses for such communications shall be: (i) if to the Company, to: Integrated Ventures, Inc., 73 Buck Rd, Huntingdon Valley, PA 19006, Attn: Steve Rubakh, Chief Executive Officer, email: emsfactory@aol.com, with a copy by email or fax only to (which shall not constitute notice): Michael Paige, Esq. email: MPaigeLaw@outlook.com and (ii) if to the Purchasers, to: the addresses and fax numbers indicated on the signature pages hereto, with an additional copy by fax only to (which shall not constitute notice): Grushko & Mittman, P.C., 515 Rockaway Avenue, Valley Stream, New York 11581, Attn: Eliezer Drew, Esq., facsimile: (212) 697-3575.
  
  	 
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 5.5 Amendments; Waivers. No provision of this Agreement nor any other Transaction Document may be waived, modified, supplemented or amended nor consent obtained or approval deemed granted except in a written instrument signed, in the case of an amendment, by the Company and the Purchasers or, in the case of a waiver, by the party against whom enforcement of any such waived provision is sought. No waiver of any default with respect to any provision, condition or requirement of this Agreement nor any other Transaction Document shall be deemed to be a continuing waiver in the future or a waiver of any subsequent default or a waiver of any other provision, condition or requirement thereof, nor shall any delay or omission of any party to exercise any right thereunder in any manner impair the exercise of any such right. Any Purchaser may waive in writing any right or benefit granted to or available to such Purchaser pursuant to the Transaction Documents.
  
 5.6 Headings. The headings herein are for convenience only, do not constitute a part of this Agreement and shall not be deemed to limit or affect any of the provisions hereof.
  
 5.7 Successors and Assigns. This Agreement shall be binding upon and inure to the benefit of the parties and their successors and permitted assigns. The Company may not assign this Agreement or any rights or obligations hereunder without the prior written consent of each Purchaser (other than by merger). Following the Closing, any Purchaser may assign any or all of its rights under this Agreement to any Person to whom such Purchaser assigns or transfers any Securities, provided that such transferee agrees in writing to be bound with respect to the transferred Securities by the provisions of the Transaction Documents that apply to the “Purchasers” and is able to make each and every representation made by Purchasers in this Agreement.
  
 5.8 No Third-Party Beneficiaries. This Agreement is intended for the benefit of the parties hereto and their respective successors and permitted assigns and is not for the benefit of, nor may any provision hereof be enforced by, any other Person, except as otherwise set forth in Section 4.10.
  
 5.9 Governing Law. All questions concerning the construction, validity, enforcement and interpretation of the Transaction Documents shall be governed by and construed and enforced in accordance with the internal laws of the State of New York, without regard to the principles of conflicts of law thereof. Each party agrees that all legal proceedings concerning the interpretations, enforcement and defense of the transactions contemplated by this Agreement and any other Transaction Documents (whether brought against a party hereto or its respective affiliates, directors, officers, shareholders, partners, members, employees or agents) shall be commenced exclusively in the state and federal courts sitting in the City of New York. Each party hereby irrevocably submits to the exclusive jurisdiction of the state and federal courts sitting in the City of New York, Borough of Manhattan for the adjudication of any dispute hereunder or in connection herewith or with any transaction contemplated hereby or discussed herein (including with respect to the enforcement of any of the Transaction Documents), and hereby irrevocably waives, and agrees not to assert in any action, suit or proceeding, any claim that it is not personally subject to the jurisdiction of any such court, that such suit, action or proceeding is improper or is an inconvenient venue for such proceeding. Each party hereby irrevocably waives personal service of process and consents to process being served in any such suit, action or proceeding by mailing a copy thereof via registered or certified mail or overnight delivery (with evidence of delivery) to such party at the address in effect for notices to it under this Agreement and agrees that such service shall constitute good and sufficient service of process and notice thereof. Nothing contained herein shall be deemed to limit in any way any right to serve process in any other manner permitted by law. If either party shall commence an action or proceeding to enforce any provisions of the Transaction Documents, then, in addition to the obligations of the Company under Section 4.10, the prevailing party in such action, suit or proceeding shall be reimbursed by the other party for its reasonable attorneys’ fees and other costs and expenses incurred with the investigation, preparation and prosecution of such action or proceeding.
  
 5.10 Survival. The representations and warranties contained herein shall survive the Closing and the delivery of the Securities.
  
 5.11 Execution. This Agreement may be executed in two or more counterparts, all of which when taken together shall be considered one and the same agreement and shall become effective when counterparts have been signed by each party and delivered to each other party, it being understood that the parties need not sign the same counterpart. In the event that any signature is delivered by facsimile transmission or by e-mail delivery of a “.pdf” format data file, such signature shall create a valid and binding obligation of the party executing (or on whose behalf such signature is executed) with the same force and effect as if such facsimile or “.pdf” signature page were an original thereof.
  
  	 
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 5.12 Severability. If any term, provision, covenant or restriction of any Transaction Document is held by a court of competent jurisdiction to be invalid, illegal, void or unenforceable, the remainder of the terms, provisions, covenants and restrictions set forth herein shall remain in full force and effect and shall in no way be affected, impaired or invalidated, and the parties hereto shall use their commercially reasonable efforts to find and employ an alternative means to achieve the same or substantially the same result as that contemplated by such term, provision, covenant or restriction. It is hereby stipulated and declared to be the intention of the parties that they would have executed the remaining terms, provisions, covenants and restrictions without including any of such that may be hereafter declared invalid, illegal, void or unenforceable.
  
 5.13 Rescission and Withdrawal Right. Notwithstanding anything to the contrary contained in (and without limiting any similar provisions of) any of the other Transaction Documents, whenever any Purchaser exercises a right, election, demand or option under a Transaction Document and the Company does not timely perform its related obligations within the periods therein provided, then such Purchaser may, at any time prior to the Company’s performance of such obligations, rescind or withdraw, in its sole discretion from time to time upon written notice to the Company, any relevant notice, demand or election in whole or in part without prejudice to its future actions and rights; provided, however, that in the case of a rescission of a conversion of a Note, the applicable Purchaser shall be required to return any shares of Common Stock subject to any such rescinded conversion or exercise notice concurrently with the return to such Purchaser of the aggregate exercise price paid to the Company for such shares and the restoration of such Purchaser’s right to acquire such shares pursuant to such Purchaser’s Note.
  
 5.14 Replacement of Securities. If any certificate or instrument evidencing any Securities is mutilated, lost, stolen or destroyed, the Company shall issue or cause to be issued in exchange and substitution for and upon cancellation thereof (in the case of mutilation), or in lieu of and substitution therefor, a new certificate or instrument, but only upon receipt of evidence reasonably satisfactory to the Company of such loss, theft or destruction. The applicant for a new certificate or instrument under such circumstances shall also pay any reasonable costs (including customary indemnity) associated with the issuance of such replacement Securities.
  
 5.15 Remedies. In addition to being entitled to exercise all rights provided herein or granted by law, including recovery of damages, each of the Purchasers and the Company will be entitled to specific performance under the Transaction Documents. The parties agree that monetary damages may not be adequate compensation for any loss incurred by reason of any breach of obligations contained in the Transaction Documents and hereby agree to waive and not to assert in any action for specific performance of any such obligation the defense that a remedy at law would be adequate. The Company’s obligations to pay any partial liquidated damages or other amounts owing under the Transaction Documents is a continuing obligation of the Company and shall not terminate until all unpaid partial liquidated damages and other amounts have been paid notwithstanding the fact that the instrument or security pursuant to which such partial liquidated damages or other amounts are due and payable shall have been canceled.
  
 5.16 Payment Set Aside. To the extent that the Company makes a payment or payments to any Purchaser pursuant to any Transaction Document or a Purchaser enforces or exercises its rights thereunder, and such payment or payments or the proceeds of such enforcement or exercise or any part thereof are subsequently invalidated, declared to be fraudulent or preferential, set aside, recovered from, disgorged by or are required to be refunded, repaid or otherwise restored to the Company, a trustee, receiver or any other Person under any law (including, without limitation, any bankruptcy law, state or federal law, common law or equitable cause of action), then to the extent of any such restoration the obligation or part thereof originally intended to be satisfied shall be revived and continued in full force and effect as if such payment had not been made or such enforcement or setoff had not occurred.
  
  	 
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 5.17 Usury. To the extent it may lawfully do so, the Company hereby agrees not to insist upon or plead or in any manner whatsoever claim, and will resist any and all efforts to be compelled to take the benefit or advantage of, usury laws wherever enacted, now or at any time hereafter in force, in connection with any claim, action or proceeding that may be brought by any Purchaser in order to enforce any right or remedy under any Transaction Document. Notwithstanding any provision to the contrary contained in any Transaction Document, it is expressly agreed and provided that the total liability of the Company under the Transaction Documents for payments in the nature of interest shall not exceed the maximum lawful rate authorized under applicable law (the “Maximum Rate”), and, without limiting the foregoing, in no event shall any rate of interest or default interest, or both of them, when aggregated with any other sums in the nature of interest that the Company may be obligated to pay under the Transaction Documents exceed such Maximum Rate. It is agreed that if the maximum contract rate of interest allowed by law and applicable to the Transaction Documents is increased or decreased by statute or any official governmental action subsequent to the date hereof, the new maximum contract rate of interest allowed by law will be the Maximum Rate applicable to the Transaction Documents from the effective date thereof forward, unless such application is precluded by applicable law. If under any circumstances whatsoever, interest in excess of the Maximum Rate is paid by the Company to any Purchaser with respect to indebtedness evidenced by the Transaction Documents, such excess shall be applied by such Purchaser to the unpaid principal balance of any such indebtedness or be refunded to the Company, the manner of handling such excess to be at such Purchaser’s election.
  
 5.18 Saturdays, Sundays, Holidays, etc. If the last or appointed day for the taking of any action or the expiration of any right required or granted herein shall not be a Business Day, then such action may be taken or such right may be exercised on the next succeeding Business Day.
  
 5.19 Construction. The parties agree that each of them and/or their respective counsel have reviewed and had an opportunity to revise the Transaction Documents and, therefore, the normal rule of construction to the effect that any ambiguities are to be resolved against the drafting party shall not be employed in the interpretation of the Transaction Documents or any amendments thereto. In addition, each and every reference to share prices and shares of Common Stock in any Transaction Document shall be subject to adjustment for reverse and forward stock splits, stock dividends, stock combinations and other similar transactions of the Common Stock that occur after the date of this Agreement.
  
 5.20 WAIVER OF JURY TRIAL. IN ANY ACTION, SUIT, OR PROCEEDING IN ANY JURISDICTION BROUGHT BY ANY PARTY AGAINST ANY OTHER PARTY, THE PARTIES EACH KNOWINGLY AND INTENTIONALLY, TO THE GREATEST EXTENT PERMITTED BY APPLICABLE LAW, HEREBY ABSOLUTELY, UNCONDITIONALLY, IRREVOCABLY AND EXPRESSLY WAIVES FOREVER TRIAL BY JURY.
  
 5.21 Equitable Adjustment. The Conversion Price, trading volume amounts, price/volume amounts and similar figures in the Transaction Documents shall be equitably adjusted (but without duplication) to offset the effect of stock splits, similar events and as otherwise described in the Transaction Documents.
  
 (Signature Pages Follow)
   	 
	22
	 
 
	 

  
 IN WITNESS WHEREOF, the parties hereto have caused this Securities Purchase Agreement to be duly executed by their respective authorized signatories as of the date first indicated above.
  
  	 	 INTEGRATED VENTURES INC.
	
	 	 	 	 
		By:	/s/ Steve Rubakh	
	  
	  
	Name: Steve Rubakh	 
	 	 	Title: CEO	 
	 	 	 	 

   
  
  
  
 [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK; SIGNATURE PAGE FOR PURCHASER FOLLOWS]
  
  	 
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 [PURCHASER SIGNATURE PAGE TO INTEGRATED VENTURES, INC. SECURITIES PURCHASE AGREEMENT]
  
 IN WITNESS WHEREOF, the undersigned have caused this Securities Purchase Agreement to be duly executed by their respective authorized signatories as of the date first indicated above.
  
 Name of Purchaser: Armada Investment Fund, LLC _____________________________________ 
  
 Signature of Authorized Signatory of Purchaser: ____/s/ Gabriel Berkowitz_____
  
 Name of Authorized Signatory: Gabriel Berkowitz___________________________________________
  
 Title of Authorized Signatory: Manager____________________________________________________
  
 Email Address of Authorized Signatory: gabriel@arcadia.capital _______________________________
  
 Facsimile Number of Authorized Signatory: _________________________________________________
  
 Address for Notice to Purchaser:
  
 1361 East 10th Street
 Brooklyn, NY 11730
  
 Address for Delivery of Securities to Purchaser (if not same as address for notice):
  
 ______________________________________________________________________________
  
 ______________________________________________________________________________
  
 ______________________________________________________________________________
  
 Subscription Amount: $50,000.00
  
 Note Principal (Subscription Amount *1.08): $52,000.00
  
 EIN Number, if applicable, will be provided under separate cover: ________________________
  
 [SIGNATURE PAGES CONTINUE]
  	 
	24
	 
 
	 

  
  
 [PURCHASER SIGNATURE PAGE TO INTEGRATED VENTURES, INC. SECURITIES PURCHASE AGREEMENT]
  
 IN WITNESS WHEREOF, the undersigned have caused this Securities Purchase Agreement to be duly executed by their respective authorized signatories as of the date first indicated above.
  
 Name of Purchaser: BHP Capital NY, Inc._____________________________________
  
  
  
 Signature of Authorized Signatory of Purchaser: ______/s/ Bryan Pantofel____
  
 Name of Authorized Signatory: Bryan Pantofel___________________________________________
  
 Title of Authorized Signatory: President____________________________________________________
  
 Email Address of Authorized Signatory: bryan@bhpcap.com_______________________________
  
 Facsimile Number of Authorized Signatory: _________________________________________________
  
 Address for Notice to Purchaser:
  
 245 East 40th St, Suite 28B
 New York, NY 10016
  
 Address for Delivery of Securities to Purchaser (if not same as address for notice):
  
 ______________________________________________________________________________
  
 ______________________________________________________________________________
  
 ______________________________________________________________________________
  
 Subscription Amount: $50,000.00
  
 Note Principal (Subscription Amount *1.08): $52,000.00
  
 EIN Number, if applicable, will be provided under separate cover: ________________________
  
  	 
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  EXHIBITS AND SCHEDULES
  
  
 Exhibit A Form of Note
 Exhibit B Escrow Agreement
 Exhibit C TA Letter
  
 Schedule 3.1(g)—authorize increase in Plan shares, not to exceed 15% of outstanding common shares
 Schedule 3.1(q)
  
  
  
  	 
	26PLACEMENT
AGENCY AGREEMENT

 

October
            , 2018

 

H.C.
Wainwright & Co., LLC

430
Park Avenue, 4th Floor

New
York, NY 10022

 

Ladies
and Gentlemen:

 

Introduction.
Subject to the terms and conditions herein (this “Agreement”), Medical Transcription Billing, Corp., a Delaware
corporation (the “Company”), hereby agrees to sell up to an aggregate of 500,000 registered shares (the
“Shares”) of the Company’s 11% Series A Cumulative Redeemable Perpetual Preferred Stock, $0.001 par value
per share (the “Preferred Stock”) (the “Securities”), directly to various investors (each,
an “Investor” and, collectively, the “Investors”) through H.C. Wainwright & Co., LLC,
as lead placement agent (the “Placement Agent”). The documents executed and delivered by the Company and the
Placement Agent, including this Agreement, shall be collectively referred to herein as the “Transaction Documents.”
The purchase price to the Investors for each Share is $25.00. The Placement Agent may retain other brokers or dealers to act as
sub-agents or selected-dealers on its behalf in connection with the Offering.

 

The
Company hereby confirms its agreement with the Placement Agent as follows:

 

	1.	Agreement
    to Act as Placement Agent. 

 

(a)
On the basis of the representations, warranties and agreements of the Company herein contained, and subject to all the terms and
conditions of this Agreement, the Placement Agent shall be the exclusive lead Placement Agent in connection with the offering
and sale by the Company of the Securities pursuant to the Company’s registration statement on Form S-1 (File No. 333-227524)
(the “Registration Statement”), with the terms of such offering (the “Offering”) to be subject
to market conditions and negotiations between the Company, the Placement Agent and the prospective Investors. If the Company files
any registration statement pursuant to Rule 462(b) of the Securities Act of 1933, as amended (the “Securities Act”),
then after such filing, the term “Registration Statement” shall include such registration statement filed pursuant
to Rule 462(b). The Placement Agent will act on a reasonable best efforts basis and the Company agrees and acknowledges that there
is no guarantee of the successful placement of the Securities, or any portion thereof, in the prospective Offering. Under no circumstances
will the Placement Agent or any of its “Affiliates” (as defined below) be obligated to underwrite or purchase any
of the Shares for its own account or otherwise provide any financing. The Placement Agent shall act solely as the Company’s
agent and not as principal. The Placement Agent shall have no authority to bind the Company with respect to any prospective offer
to purchase Shares and the Company shall have the sole right to accept offers to purchase Shares and may reject any such offer,
in whole or in part. Subject to the terms and conditions hereof, payment of the purchase price for, and delivery of, the Securities
shall be made at one or more closings (each a “Closing” and the date on which each Closing occurs, a “Closing
Date”). As compensation for services rendered, on each Closing Date, the Company shall pay to the Placement Agent the
fees and expenses set forth below:

 

(i)
A cash fee equal to 9.5 % of the gross proceeds received by the Company from the sale of the Securities at the closing of
the Offering (the “Closing”).

 

    	 

    	 

    

 

(ii)
A non-accountable expense reimbursement of $25,000 for each Closing.

 

(iii)
The Company also agrees to pay the Placement Agent up to $75,000 for the fees and expenses of its legal counsel. Up to $10,000
of additional actual costs related to clearing and settlement of the Securities shall be reimbursable to the Placement Agent.

 

(b)
The term of the Placement Agent’s exclusive engagement will be until the completion of the Offering (the “Exclusive
Term”); provided, however, that a party hereto may terminate the engagement with respect to itself at
any time upon 10 days written notice to the other parties. Notwithstanding anything to the contrary contained herein, the provisions
concerning confidentiality, indemnification and contribution contained herein and the Company’s obligations contained in
the indemnification provisions will survive any expiration or termination of this Agreement, and the Company’s obligation
to pay fees actually earned and payable and to reimburse expenses actually incurred and reimbursable pursuant to Section 1 hereof
and which are permitted to be reimbursed under FINRA Rule 5110(f)(2)(D), will survive any expiration or termination of this Agreement.
Nothing in this Agreement shall be construed to limit the ability of the Placement Agent or its Affiliates to pursue, investigate,
analyze, invest in, or engage in investment banking, financial advisory or any other business relationship with Persons (as defined
below) other than the Company. As used herein (i) “Persons” means an individual or corporation, partnership, trust,
incorporated or unincorporated association, joint venture, limited liability company, joint stock company, government (or an agency
or subdivision thereof) or other entity of any kind and (ii) “Affiliate” means any Person that, directly or indirectly
through one or more intermediaries, controls or is controlled by or is under common control with a Person as such terms are used
in and construed under Rule 405 under the Securities Act of 1933, as amended (the “Securities Act”).

 

	2.	Representations,
    Warranties and Covenants of the Company. The Company hereby represents, warrants and covenants to the Placement Agent
    as of the date hereof, and as of each Closing Date, as follows:

 

(a)
Securities Law Filings. The Company has filed with the Securities and Exchange Commission (the “Commission”)
the Registration Statement under the Securities Act, which was filed on September 25, 2018 (File No. 333-227524) for the registration
under the Securities Act of the Securities, which included a preliminary prospectus of even date therewith or as amended, called
the “Preliminary Prospectus”. Following the effectiveness of the Registration Statement, the Company will file
with the Commission, if required by the rules and regulations (the “Rules and Regulations”) of the Commission
promulgated thereunder, a final prospectus relating to the placement of the Securities and will advise the Placement Agent of
all further information (financial and other) with respect to the Company required to be set forth therein. Such registration
statement, at any given time, including the exhibits thereto filed at such time, as amended at such time, is hereinafter called
the “Registration Statement”; such final prospectus in the form in which filed with the Commission is hereinafter
called the “Prospectus”. The Registration Statement at the time it originally becomes effective is hereinafter
called the “Original Registration Statement.” Any reference in this Agreement to the Registration Statement,
the Original Registration Statement, the Preliminary Prospectus or the Prospectus shall be deemed to refer to and include the
documents incorporated by reference therein (the “Incorporated Documents”), if any, which were or are filed
under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), at any given time, as the case
may be; and any reference in this Agreement to the terms “amend,” “amendment” or “supplement”
with respect to the Registration Statement, the Original Registration Statement, the Preliminary Prospectus or the Prospectus
shall be deemed to refer to and include the filing of any document under the Exchange Act after the date of this Agreement, or
the issue date of the Preliminary Prospectus or the Prospectus, as the case may be, deemed to be incorporated therein by reference.
All references in this Agreement to financial statements and schedules and other information which is “contained,”
“included,” “described,” “referenced,” “set forth” or “stated” in
the Registration Statement, the Preliminary Prospectus or the Prospectus (and all other references of like import) shall be deemed
to mean and include all such financial statements and schedules and other information which is or is deemed to be incorporated
by reference in the Registration Statement, the Preliminary Prospectus or the Prospectus, as the case may be. The Company has
not received any notice that the Commission has issued or intends to issue a stop order suspending the effectiveness of the Registration
Statement or the use of the Preliminary Prospectus or the Prospectus or intends to commence a proceeding for any such purpose.

 

    	 	2	 

    	 

    

 

(b)
Assurances. The Original Registration Statement, as amended, (and any further documents to be filed with the Commission)
contains all exhibits and schedules as required by the Securities Act. Each of the Registration Statement and any post-effective
amendment thereto, at the time it became effective, complied in all material respects with the Securities Act and the applicable
Rules and Regulations and did not contain any 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 not misleading. The Preliminary Prospectus, and the Prospectus,
each as of its respective date, comply or will comply in all material respects with the Securities Act and the applicable Rules
and Regulations. Each of the Preliminary Prospectus and the Prospectus, as amended or supplemented, did not and will not contain
as of the date thereof any untrue statement of a material fact or omit to state a material fact necessary in order to make the
statements therein, in light of the circumstances under which they were made, not misleading. The Incorporated Documents, when
they were filed with the Commission, conformed in all material respects to the requirements of the Exchange Act and the applicable
rules and regulations promulgated thereunder, and none of such documents, when they were filed with the Commission, contained
any untrue statement of a material fact or omitted to state a material fact necessary to make the statements therein (with respect
to Incorporated Documents incorporated by reference in the Preliminary Prospectus or Prospectus), in light of the circumstances
under which they were made not misleading. No post-effective amendment to the Registration Statement reflecting any facts or events
arising after the date thereof which represent, individually or in the aggregate, a fundamental change in the information set
forth therein is required to be filed with the Commission. Except for this Agreement, there are no documents required to be filed
with the Commission in connection with the transaction contemplated hereby that (x) have not been filed as required pursuant to
the Securities Act or (y) will not be filed within the requisite time period. Except for this Agreement, there are no contracts
or other documents required to be described in the Preliminary Prospectus or Prospectus, or to be filed as exhibits or schedules
to the Registration Statement, which have not been described or filed as required.

 

(c)
Offering Materials. Neither the Company nor any of its directors and officers has distributed and none of them will distribute,
prior to each Closing Date, any offering material in connection with the offering and sale of the Securities other than the Preliminary
Prospectus, the Prospectus, the Company Free Writing Prospectus, the Registration Statement, copies of the documents incorporated
by reference therein and any other materials permitted by the Securities Act.

 

(d)
Subsidiaries. All of the direct and indirect subsidiaries of the Company (the “Subsidiaries”) are set
forth in the Incorporated Documents. The Company owns, directly or indirectly, all of the capital stock or other equity interests
of each Subsidiary free and clear of any liens, charges, security interests, encumbrances, rights of first refusal, preemptive
rights or other restrictions (collectively, “Liens”), except for one share of capital stock of Medical Transcription
Billing, Corp. (Private) Limited owned by Mahmud Haq, Executive Chairman of the Board. All of the issued and outstanding shares
of capital stock of each Subsidiary are validly issued and are fully paid, non-assessable and free of preemptive and similar rights
to subscribe for or purchase securities.

 

    	 	3	 

    	 

    

 

(e)
Organization and Qualification. The Company and each of the Subsidiaries is an entity duly incorporated or otherwise organized,
validly existing and in good standing under the laws of the jurisdiction of its incorporation or organization, with the requisite
power and authority to own and use its properties and assets and to carry on its business as currently conducted. Neither the
Company nor any Subsidiary is in violation nor default of any of the provisions of its respective certificate or articles of incorporation,
bylaws or other organizational or charter documents. Each of the Company and the Subsidiaries is duly qualified to conduct business
and is in good standing as a foreign corporation or other entity in each jurisdiction in which the nature of the business conducted
or property owned by it makes such qualification necessary, except where the failure to be so qualified or in good standing, as
the case may be, could not have or reasonably be expected to result in: (i) a material adverse effect on the legality, validity
or enforceability of this Agreement or any other agreement entered into between the Company and the Investors, (ii) a material
adverse effect on the results of operations, assets, business, prospects or condition (financial or otherwise) of the Company
and the Subsidiaries, taken as a whole, or (iii) a material adverse effect on the Company’s ability to perform in any material
respect on a timely basis its obligations under this Agreement or the transactions contemplated under the Prospectus (any of (i),
(ii) or (iii), a “Material Adverse Effect”) and no an action, claim, suit, investigation or proceeding (including,
without limitation, an informal investigation or partial proceeding, such as a deposition), whether commenced or threatened (“Proceeding”)
has been instituted in any such jurisdiction revoking, limiting or curtailing or seeking to revoke, limit or curtail such power
and authority or qualification.

 

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

 

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

 

    	 	4	 

    	 

    

 

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

 

(i)
Issuance of the Securities; Registration. The Securities are duly authorized and, when issued and paid for in accordance
with the Prospectus, will be duly and validly issued, fully paid and nonassessable, free and clear of all Liens imposed by the
Company.

 

(j)
Capitalization. The capitalization of the Company is as set forth in the SEC Reports. The Company has not issued any capital
stock since its most recently filed periodic or current report under the Exchange Act, other than pursuant to the exercise of
employee stock options or restricted stock units under the Company’s stock option plans, the issuance of shares of Common
Stock to employees pursuant to the Company’s employee stock purchase plans and pursuant to the conversion and/or exercise
of Common Stock Equivalents outstanding as of the date of the most recently filed periodic report under the Exchange Act. Common
Stock Equivalents means any securities of the Company or the Subsidiaries which would entitle the holder thereof to acquire at
any time Common Stock, including, without limitation, any debt, preferred stock, right, option, warrant or other instrument that
is at any time convertible into or exercisable or exchangeable for, or otherwise entitles the holder thereof to receive, Common
Stock. No Person has any right of first refusal, preemptive right, right of participation, or any similar right to participate
in the transactions contemplated by the Transaction Documents. Except as a result of the purchase and sale of the Shares or as
disclosed in the SEC Reports, there are no outstanding options, warrants, scrip rights to subscribe to, calls or commitments of
any character whatsoever relating to, or securities, rights or obligations convertible into or exercisable or exchangeable for,
or giving any Person any right to subscribe for or acquire, any shares of Preferred Stock, Common Stock or the capital stock of
any Subsidiary, or contracts, commitments, understandings or arrangements by which the Company or any Subsidiary is or may become
bound to issue additional shares of Preferred Stock, Common Stock or Common Stock Equivalents or capital stock of any Subsidiary.
The issuance and sale of the Shares will not obligate the Company or any Subsidiary to issue shares of Preferred Stock, Common
Stock or other securities to any Person (other than the Purchasers) and will not result in a right of any holder of Company securities
to adjust the exercise, conversion, exchange or reset price under any of such securities. There are no securities of the Company
or any Subsidiary that have any anti-dilution or similar adjustment rights (other than adjustments for stock splits, recapitalizations,
and the like) to the exercise or conversion price, have any exchange rights, or reset rights. Except for the redemption terms
of the Preferred Stock and company rights of repurchase that may be applicable to exercised stock options or to restricted stock
units, there are no outstanding securities or instruments of the Company or any Subsidiary that contain any redemption or similar
provisions, and there are no contracts, commitments, understandings or arrangements by which the Company or any Subsidiary is
or may become bound to redeem a security of the Company or such Subsidiary. Except as provided in the Company’s equity incentive
plan, the Company does not have any stock appreciation rights or “phantom stock” plans or agreements or any similar
plan or agreement. All of the outstanding shares of capital stock of the Company are duly authorized, validly issued, fully paid
and nonassessable, have been issued in compliance with all federal and state securities laws, and none of such outstanding shares
was issued in violation of any preemptive rights or similar rights to subscribe for or purchase securities. No further approval
or authorization of any stockholder, the Board of Directors or others is required for the issuance and sale of the Shares. There
are no stockholders agreements, voting agreements or other similar agreements with respect to the Company’s capital stock
to which the Company is a party or, to the knowledge of the Company, between or among any of the Company’s stockholders.

 

    	 	5	 

    	 

    

 

(k)
SEC Reports; Financial Statements. The Company has filed all reports, schedules, forms, statements and other documents
required to be filed by the Company under the Securities Act and the Exchange Act, including pursuant to Section 13(a) or 15(d)
thereof, for the two years preceding the date hereof (or such shorter period as the Company was required by law or regulation
to file such material) (the foregoing materials, including the exhibits thereto and documents incorporated by reference therein,
together with the Preliminary Prospectus, Company Free Writing Prospectus and the Prospectus, being collectively referred to herein
as the “SEC Reports”) on a timely basis or has received a valid extension of such time of filing and has filed
any such SEC Reports prior to the expiration of any such extension. As of their respective dates, the SEC Reports complied in
all material respects with the requirements of the Securities Act and the Exchange Act, as applicable, and none of the SEC Reports,
when filed, contained any untrue statement of a material fact or omitted to state a material fact required to be stated therein
or necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading.
The Company has never been an issuer subject to Rule 144(i) under the Securities Act. The financial statements of the Company
included in the SEC Reports comply in all material respects with applicable accounting requirements and the rules and regulations
of the Commission with respect thereto as in effect at the time of filing. Such financial statements have been prepared in accordance
with United States generally accepted accounting principles applied on a consistent basis during the periods involved (“GAAP”),
except as may be otherwise specified in such financial statements or the notes thereto and except that unaudited financial statements
may not contain all footnotes required by GAAP, and fairly present in all material respects the financial position of the Company
and its consolidated Subsidiaries as of and for the dates thereof and the results of operations and cash flows for the periods
then ended, subject, in the case of unaudited statements, to normal, immaterial, year-end audit adjustments.

 

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

 

    	 	6	 

    	 

    

 

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

 

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

 

    	 	7	 

    	 

    

 

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

 

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

 

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

 

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

 

    	 	8	 

    	 

    

 

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

 

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

 

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

 

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

 

    	 	9	 

    	 

    

 

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

 

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

 

(y)
Registration Rights. Except as set forth in SEC Reports and for piggy-back registration rights granted to Opus Bank for
the common stock underlying its warrants, no Person has any right to cause the Company or any Subsidiary to effect the registration
under the Securities Act of any securities of the Company or any Subsidiary.

 

(z)
Listing and Maintenance Requirements. The Preferred Stock is registered pursuant to Section 12(b) or 12(g) of the Exchange
Act, and the Company has taken no action designed to, or which to its knowledge is likely to have the effect of, terminating the
registration of the Preferred Stock under the Exchange Act nor has the Company received any notification that the Commission is
contemplating terminating such registration. The Company has not, in the 12 months preceding the date hereof, received notice
from any Trading Market on which the Preferred Stock is or has been listed or quoted to the effect that the Company is not in
compliance with the listing or maintenance requirements of such Trading Market with respect to the Preferred Stock. The Company
is, and has no reason to believe that it will not in the foreseeable future continue to be, in compliance with all such listing
and maintenance requirements. The Preferred Stock is currently eligible for electronic transfer through the Depository Trust Company
or another established clearing corporation and the Company is current in payment of the fees to the Depository Trust Company
(or such other established clearing corporation) in connection with such electronic transfer.

 

    	 	10	 

    	 

    

 

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

 

(bb)
Disclosure. Except with respect to the material terms and conditions of the transactions contemplated by this Agreement
and the transactions contemplated pursuant to the Prospectus, the Company confirms that neither it nor any other Person acting
on its behalf has provided any of the Investors or their agents or counsel with any information that it believes constitutes or
might constitute material, non-public information which is not otherwise disclosed in the Preliminary Prospectus, any Company
Free Writing Prospectus or the Prospectus. The Company understands and confirms that the Investors will rely on the foregoing
representation in effecting transactions in securities of the Company. All of the disclosure furnished by or on behalf of the
Company to the Investors regarding the Company and, its Subsidiaries, their respective businesses and the transactions contemplated
hereby is true and correct and does not contain any untrue statement of a material fact or omit to state any material fact necessary
in order to make the statements made therein, in light of the circumstances under which they were made, not misleading. The press
releases disseminated by the Company during the twelve months preceding the date of this Agreement taken as a whole do not contain
any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary in order to
make the statements therein, in light of the circumstances under which they were made and when made, not misleading.

 

(cc)
No Integrated Offering. Neither the Company, nor any of its Affiliates, nor any Person acting on its or their behalf has,
directly or indirectly, made any offers or sales of any security or solicited any offers to buy any security, under circumstances
that would cause this offering of the Securities to be integrated with prior offerings by the Company for purposes of any applicable
shareholder approval provisions of any Trading Market on which any of the securities of the Company are listed or designated.

 

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

 

    	 	11	 

    	 

    

 

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

 

(ff)
Foreign Corrupt Practices. Neither the Company nor any Subsidiary, nor to the knowledge of the Company or any Subsidiary,
any agent or other person acting on behalf of the Company or any Subsidiary, has (i) directly or indirectly, used any funds for
unlawful contributions, gifts, entertainment or other unlawful expenses related to foreign or domestic political activity, (ii)
made any unlawful payment to foreign or domestic government officials or employees or to any foreign or domestic political parties
or campaigns from corporate funds, (iii) failed to disclose fully any contribution made by the Company or any Subsidiary (or made
by any person acting on its behalf of which the Company is aware) which is in violation of law, or (iv) violated in any material
respect any provision of the Foreign Corrupt Practices Act of 1977, as amended.

 

(gg)
Accountants. The Company’s accounting firm is Grant Thornton LLP. To the knowledge and belief of the Company, such
accounting firm (i) is a registered public accounting firm as required by the Exchange Act and (ii) has expressed its opinion
with respect to the financial statements included in the Company’s Annual Report for the fiscal year ending December 31,
2017.

 

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

 

    	 	12	 

    	 

    

 

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

 

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

 

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

 

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

 

(mm)
Certificates. Any certificate signed by an officer of the Company and delivered to the Placement Agent or to counsel for
the Placement Agent shall be deemed to be a representation and warranty by the Company to the Placement Agent as to the matters
set forth therein.

 

(nn)
Reliance. The Company acknowledges that the Placement Agent will rely upon the accuracy and truthfulness of the foregoing
representations and warranties and hereby consents to such reliance.

 

(oo)
FINRA Affiliations. There are no affiliations with any FINRA member firm among the Company’s officers, directors
or, to the knowledge of the Company, any five percent (5%) or greater stockholder of the Company, except for John N. Daly, a director
of the Company.

 

	3.	Delivery
    and Payment. Each Closing shall occur at the offices of Sichenzia Ross Ference LLP, 1185 Avenue of the Americas, 37th
    Floor, New York, NY 10036 (or at such other place as shall be agreed upon by the Placement Agent and the Company) (“Placement
    Agent Counsel”). Subject to the terms and conditions hereof, at each Closing payment of the purchase price for the
    Securities sold on such Closing Date shall be made by Federal Funds wire transfer, against delivery of such Securities, and
    such Securities shall be registered in such name or names and shall be in such denominations, as the Placement Agent may request
    at least one business day before the time of purchase (as defined below).

 

Deliveries
of the documents with respect to the purchase of the Securities, if any, shall be made at the offices of Placement Agent Counsel.
All actions taken at a Closing shall be deemed to have occurred simultaneously.

 

    	 	13	 

    	 

    

 

	4.	Covenants
    and Agreements of the Company. The Company further covenants and agrees with the Placement Agent as follows:

 

(a)
Registration Statement Matters. The Company will advise the Placement Agent promptly after it receives notice thereof of
the time when any amendment to the Registration Statement has been filed or becomes effective or any supplement to any Prospectus
or any amended Prospectus has been filed and will furnish the Placement Agent with copies thereof. The Company will file promptly
all reports and any definitive proxy or information statements required to be filed by the Company with the Commission pursuant
to Section 13(a), 14 or 15(d) of the Exchange Act subsequent to the date of any Prospectus and for so long as the delivery of
a prospectus is required in connection with the Offering. The Company will advise the Placement Agent, promptly after it receives
notice thereof (i) of any request by the Commission to amend the Registration Statement or to amend or supplement any Prospectus
or for additional information, and (ii) of the issuance by the Commission of any stop order suspending the effectiveness of the
Registration Statement or any post-effective amendment thereto or any order directed at any Incorporated Document, if any, or
any amendment or supplement thereto or any order preventing or suspending the use of the Preliminary Prospectus or any Prospectus
or any amendment or supplement thereto or any post-effective amendment to the Registration Statement, of the suspension of the
qualification of the Securities for offering or sale in any jurisdiction, of the institution or threatened institution of any
proceeding for any such purpose, or of any request by the Commission for the amending or supplementing of the Registration Statement
or a Prospectus or for additional information. The Company shall use its best efforts to prevent the issuance of any such stop
order or prevention or suspension of such use. If the Commission shall enter any such stop order or order or notice of prevention
or suspension at any time, the Company will use its best efforts to obtain the lifting of such order at the earliest possible
moment, or will file a new registration statement and use its best efforts to have such new registration statement declared effective
as soon as practicable. Additionally, the Company agrees that it shall comply with the provisions of Rules 424(b), 430A, 430B
and 430C, as applicable, under the Securities Act, including with respect to the timely filing of documents thereunder, and will
use its reasonable efforts to confirm that any filings made by the Company under such Rule 424(b) are received in a timely manner
by the Commission.

 

(b)
Blue Sky Compliance. The Company will cooperate with the Placement Agent and the Investors in endeavoring to qualify the
Securities for sale under the securities laws of such jurisdictions (United States and foreign) as the Placement Agent and the
Investors may reasonably request and will make such applications, file such documents, and furnish such information as may be
reasonably required for that purpose, provided the Company shall not be required to qualify as a foreign corporation or to file
a general consent to service of process in any jurisdiction where it is not now so qualified or required to file such a consent,
and provided further that the Company shall not be required to produce any new disclosure document other than a Prospectus. The
Company will, from time to time, prepare and file such statements, reports and other documents as are or may be required to continue
such qualifications in effect for so long a period as the Placement Agent may reasonably request for distribution of the Securities.
The Company will advise the Placement Agent promptly of the suspension of the qualification or registration of (or any such exemption
relating to) the Securities for offering, sale or trading in any jurisdiction or any initiation or threat of any proceeding for
any such purpose, and in the event of the issuance of any order suspending such qualification, registration or exemption, the
Company shall use its best efforts to obtain the withdrawal thereof at the earliest possible moment.

 

    	 	14	 

    	 

    

 

(c)
Amendments and Supplements to a Prospectus and Other Matters. The Company will comply with the Securities Act and the Exchange
Act, and the rules and regulations of the Commission thereunder, so as to permit the completion of the distribution of the Securities
as contemplated in this Agreement, the Incorporated Documents and any Prospectus. If during the period in which a prospectus is
required by law to be delivered in connection with the distribution of Securities contemplated by the Incorporated Documents or
any Prospectus (the “Prospectus Delivery Period”), any event shall occur as a result of which, in the judgment
of the Company or in the opinion of the Placement Agent or counsel for the Placement Agent, it becomes necessary to amend or supplement
the Incorporated Documents or any Preliminary Prospectus or Prospectus in order to make the statements therein, in the light of
the circumstances under which they were made, as the case may be, not misleading, or if it is necessary at any time to amend or
supplement the Incorporated Documents or any Preliminary Prospectus or Prospectus or to file under the Exchange Act any Incorporated
Document to comply with any law, the Company will promptly prepare and file with the Commission, and furnish at its own expense
to the Placement Agent and to dealers, an appropriate amendment to the Registration Statement or supplement to the Registration
Statement, the Incorporated Documents or any Preliminary Prospectus or Prospectus that is necessary in order to make the statements
in the Incorporated Documents and any Preliminary Prospectus or Prospectus as so amended or supplemented, in the light of the
circumstances under which they were made, as the case may be, not misleading, or so that the Registration Statement, the Incorporated
Documents or any Preliminary Prospectus or Prospectus, as so amended or supplemented, will comply with law. Before amending the
Registration Statement or supplementing the Incorporated Documents or any Preliminary Prospectus or Prospectus in connection with
the Offering, the Company will furnish the Placement Agent with a copy of such proposed amendment or supplement and will not file
any such amendment or supplement to which the Placement Agent reasonably objects.

 

(d)
Copies of any Amendments and Supplements to a Prospectus. The Company will furnish the Placement Agent, without charge,
during the period beginning on the date hereof and ending on the later of the last Closing Date of the Offering, as many copies
of the Incorporated Documents and any Preliminary Prospectus or Prospectus and any amendments and supplements thereto (including
any Incorporated Documents, if any) as the Placement Agent may reasonably request.

 

(e)
Free Writing Prospectus. The Company covenants that it will not, unless it obtains the prior written consent of the Placement
Agent, make any offer relating to the Securities that would constitute a Company Free Writing Prospectus or that would otherwise
constitute a “free writing prospectus” (as defined in Rule 405 of the Securities Act) required to be filed
by the Company with the Commission or retained by the Company under Rule 433 of the Securities Act. In the event that the Placement
Agent expressly consents in writing to any such free writing prospectus (a “Permitted Free Writing Prospectus”),
the Company covenants that it shall (i) treat each Permitted Free Writing Prospectus as a Company Free Writing Prospectus, and
(ii) comply with the requirements of Rule 164 and 433 of the Securities Act applicable to such Permitted Free Writing Prospectus,
including in respect of timely filing with the Commission, legending and record keeping.

 

(f)
Transfer Agent. The Company will maintain, at its expense, a registrar and transfer agent for the Preferred Stock.

 

    	 	15	 

    	 

    

 

(g)
Earnings Statement. As soon as practicable and in accordance with applicable requirements
under the Securities Act, but in any event not later than 18 months after the last Closing Date, the Company will make generally
available to its security holders and to the Placement Agent an earnings statement, covering a period of at least 12 consecutive
months beginning after the last Closing Date, that satisfies the provisions of Section 11(a) and Rule 158 under the Securities
Act.

 

(h)
Periodic Reporting Obligations. During the Prospectus Delivery Period, the Company will duly file, on a timely basis, with
the Commission and the Trading Market all reports and documents required to be filed under the Exchange Act within the time periods
and in the manner required by the Exchange Act.

 

(i)
Omitted.

 

(j)
No Manipulation of Price. The Company will not take, directly or indirectly, any action designed to cause or result
in, or that has constituted or might reasonably be expected to constitute, the stabilization or manipulation of the price of any
securities of the Company.

 

(k)
Acknowledgment. The Company acknowledges that any advice given by the Placement Agent to the Company is solely for the
benefit and use of the Board of Directors of the Company and may not be used, reproduced, disseminated, quoted or referred to,
without the Placement Agent’s prior written consent.

 

	5.	Conditions
    of the Obligations of the Placement Agent. The obligations of the Placement Agent hereunder shall be subject to the accuracy
    of the representations and warranties on the part of the Company set forth in Section 2 hereof, in each case as of the date
    hereof and as of each Closing Date as though then made, to the timely performance by each of the Company of its covenants
    and other obligations hereunder on and as of such dates, and to each of the following additional conditions: 

 

(a)
Accountants’ Comfort Letter. On the initial Closing Date, the Placement Agent shall have received, and the Company
shall have caused to be delivered to the Placement Agent, a letter from Grant Thornton LLP (the independent registered public
accounting firm of the Company), addressed to the Placement Agent, dated as of the initial Closing Date, in form and substance
satisfactory to the Placement Agent. The letter shall not disclose any change in the condition (financial or other), earnings,
operations, business or prospects of the Company from that set forth in the Incorporated Documents or the applicable Prospectus,
which, in the Placement Agent’s sole judgment, is material and adverse and that makes it, in the Placement Agent’s
sole judgment, impracticable or inadvisable to proceed with the Offering of the Securities as contemplated by such Prospectus.

 

(b)
Compliance with Registration Requirements; No Stop Order; No Objection from the FINRA. Each Preliminary Prospectus or Prospectus
(in accordance with Rule 424(b)) and “free writing prospectus” (as defined in Rule 405 of the Securities Act),
if any, shall have been duly filed with the Commission, as appropriate; no stop order suspending the effectiveness of the Registration
Statement or any part thereof shall have been issued and no proceeding for that purpose shall have been initiated or threatened
by the Commission; no order preventing or suspending the use of any Preliminary Prospectus or Prospectus shall have been issued
and no proceeding for that purpose shall have been initiated or threatened by the Commission; no order having the effect of ceasing
or suspending the distribution of the Securities or any other securities of the Company shall have been issued by any securities
commission, securities regulatory authority or stock exchange and no proceedings for that purpose shall have been instituted or
shall be pending or, to the knowledge of the Company, contemplated by any securities commission, securities regulatory authority
or stock exchange; all requests for additional information on the part of the Commission shall have been complied with; and the
FINRA shall have raised no objection to the fairness and reasonableness of the placement terms and arrangements.

 

    	 	16	 

    	 

    

 

(c)
Corporate Proceedings. All corporate proceedings and other legal matters in connection with this Agreement, the Registration
Statement and each Prospectus, and the registration, sale and delivery of the Securities, shall have been completed or resolved
in a manner reasonably satisfactory to the Placement Agent’s counsel, and such counsel shall have been furnished with such
papers and information as it may reasonably have requested to enable such counsel to pass upon the matters referred to in this
Section 5.

 

(d)
No Material Adverse Change. Subsequent to the execution and delivery of this Agreement and prior to each Closing Date,
in the Placement Agent’s sole judgment after consultation with the Company, there shall not have occurred any Material Adverse
Change or Material Adverse Effect.

 

(e)
Opinion of Counsel for the Company. The Placement Agent shall have received on each Closing Date the favorable opinion
of US legal counsel to the Company, dated as of such Closing Date, including, without limitation, a negative assurance letter
addressed to the Placement Agent and in form and substance satisfactory to the Placement Agent.

 

(f)
Officers’ Certificate. The Placement Agent shall have received on each Closing Date a certificate of the Company,
dated as of such Closing Date, signed by the Chief Executive Officer and Chief Financial Officer of the Company, to the effect
that, and the Placement Agent shall be satisfied that, the signers of such certificate have reviewed the Registration Statement,
the Incorporated Documents, any Prospectus, and this Agreement and to the further effect that:

 

(i)
The representations and warranties of the Company in this Agreement are true and correct, as if made on and as of such Closing
Date, and the Company has complied with all the agreements and satisfied all the conditions on its part to be performed or satisfied
at or prior to such Closing Date;

 

(ii)
No stop order suspending the effectiveness of the Registration Statement or the use of the Preliminary Prospectus or any Prospectus
has been issued and no proceedings for that purpose have been instituted or are pending or, to the Company’s knowledge,
threatened under the Securities Act; no order having the effect of ceasing or suspending the distribution of the Securities or
any other securities of the Company has been issued by any securities commission, securities regulatory authority or stock exchange
in the United States and no proceedings for that purpose have been instituted or are pending or, to the knowledge of the Company,
contemplated by any securities commission, securities regulatory authority or stock exchange in the United States;

 

(iii)
When the Registration Statement became effective, at the time of sale, and at all times subsequent thereto up to the delivery
of such certificate, the Registration Statement and the Incorporated Documents, if any, when such documents became effective or
were filed with the Commission, contained all material information required to be included therein by the Securities Act and the
Exchange Act and the applicable rules and regulations of the Commission thereunder, as the case may be, and in all material respects
conformed to the requirements of the Securities Act and the Exchange Act and the applicable rules and regulations of the Commission
thereunder, as the case may be, and the Registration Statement and the Incorporated Documents, if any, did not and do not include
any 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 light of the circumstances under which they were made, not misleading (provided, however, that the
preceding representations and warranties contained in this paragraph (iii) shall not apply to any statements or omissions made
in reliance upon and in conformity with information furnished in writing to the Company by the Placement Agent expressly for use
therein) and, since the effective date of the Registration Statement, there has occurred no event required by the Securities Act
and the rules and regulations of the Commission thereunder to be set forth in the Incorporated Documents which has not been so
set forth; and

 

    	 	17	 

    	 

    

 

(iv)
Subsequent to the respective dates as of which information is given in the Registration Statement, the Incorporated Documents
and any Prospectus, there has not been: (a) any Material Adverse Change; (b) any transaction that is material to the Company and
the Subsidiaries taken as a whole, except transactions entered into in the ordinary course of business; (c) any obligation, direct
or contingent, that is material to the Company and the Subsidiaries taken as a whole, incurred by the Company or any Subsidiary,
except obligations incurred in the ordinary course of business; (d) any material change in the capital stock (except changes thereto
resulting from the exercise of outstanding stock options or warrants) or outstanding indebtedness of the Company or any Subsidiary;
(e) any dividend or distribution of any kind declared, paid or made on the capital stock of the Company; or (f) any loss or damage
(whether or not insured) to the property of the Company or any Subsidiary which has been sustained or will have been sustained
which has a Material Adverse Effect.

 

(g)
Bring-down Comfort Letter. On each Closing Date that is subsequent to the initial Closing Date, the Placement Agent
shall have received from Grant Thornton LLP, or such other independent registered public accounting firm of the Company, a letter
dated as of such Closing Date, in form and substance satisfactory to the Placement Agent, to the effect that they reaffirm the
statements made in the letter furnished pursuant to subsection (a) of this Section 5, except that the specified date referred
to therein for the carrying out of procedures shall be no more than three business days prior to such Closing Date.

 

(h)
Stock Exchange Listing. The Preferred Stock shall be registered under the Exchange Act and shall be listed on the Trading
Market, and the Company shall not have taken any action designed to terminate, or likely to have the effect of terminating, the
registration of the Preferred Stock under the Exchange Act or delisting or suspending from trading the Preferred Stock from the
Trading Market, nor shall the Company have received any information suggesting that the Commission or the Trading Market is contemplating
terminating such registration or listing.

 

(i)
Additional Documents. On or before each Closing Date, the Placement Agent and counsel for the Placement Agent shall have
received such information and documents as they may reasonably require for the purposes of enabling them to pass upon the issuance
and sale of the Securities as contemplated herein, or in order to evidence the accuracy of any of the representations and warranties,
or the satisfaction of any of the conditions or agreements, herein contained.

 

    	 	18	 

    	 

    

 

(j)
Subsequent Equity Sales. From the date hereof until 90 days after the Closing Date, neither the Company nor any Subsidiary
shall issue, enter into any agreement to issue or announce the issuance or proposed issuance of any shares of Preferred Stock,
Common Stock or Common Stock Equivalents without written approval from the Placement Agent.

 

If
any condition specified in this Section 5 is not satisfied when and as required to be satisfied, this Agreement may be terminated
by the Placement Agent by notice to the Company at any time on or prior to a Closing Date, which termination shall be without
liability on the part of any party to any other party, except that Section 6 (Payment of Expenses), Section 7 (Indemnification
and Contribution) and Section 8 (Representations and Indemnities to Survive Delivery) shall at all times be effective and shall
survive such termination.

 

	6.	Payment
    of Expenses. The Company agrees to pay all costs, fees and expenses incurred by the Company in connection with the performance
    of its obligations hereunder and in connection with the transactions contemplated hereby and, except as otherwise provided
    herein, the Company shall not pay for any costs, fees or expenses incurred by the Placement Agent in connection with the performance
    of its obligations hereunder and in connection with the transactions contemplated hereby.

 

	7.	Indemnification
    and Contribution. 

 

(a)
The Company agrees to indemnify and hold harmless the Placement Agent, its affiliates and each person controlling the Placement
Agent (within the meaning of Section 15 of the Securities Act), and the directors, officers, agents and employees of the Placement
Agent, its affiliates and each such controlling person (the Placement Agent, and each such entity or person. an “Indemnified
Person”) from and against any losses, claims, damages, judgments, assessments, costs and other liabilities (collectively,
the “Liabilities”), and shall reimburse each Indemnified Person for all fees and expenses (including the reasonable
fees and expenses of one counsel for all Indemnified Persons, except as otherwise expressly provided herein) (collectively, the
“Expenses”) as they are incurred by an Indemnified Person in investigating, preparing, pursuing or defending
any Actions, whether or not any Indemnified Person is a party thereto, (i) caused by, or arising out of or in connection with,
any untrue statement or alleged untrue statement of a material fact contained in any Incorporated Document or by any omission
or alleged omission to state therein a material fact necessary to make the statements therein, in light of the circumstances under
which they were made, not misleading (other than untrue statements or alleged untrue statements in, or omissions or alleged omissions
from, information relating to an Indemnified Person furnished in writing by or on behalf of such Indemnified Person expressly
for use in the Incorporated Documents) or (ii) otherwise arising out of or in connection with advice or services rendered or to
be rendered by any Indemnified Person pursuant to this Agreement, the transactions contemplated thereby or any Indemnified Person’s
actions or inactions in connection with any such advice, services or transactions; provided, however, that, in the case
of clause (ii) only, the Company shall not be responsible for any Liabilities or Expenses of any Indemnified Person that are finally
judicially determined to have resulted from such Indemnified Person’s (x) gross negligence or willful misconduct in connection
with any of the advice, actions, inactions or services referred to above or (y) use of any offering materials or information concerning
the Company in connection with the offer or sale of the Securities in the Offering which were not authorized for such use by the
Company and which use constitutes gross negligence or willful misconduct. The Company also agrees to reimburse each Indemnified
Person for all Expenses as they are incurred in connection with enforcing such Indemnified Person’s rights under this Agreement.

 

    	 	19	 

    	 

    

 

(b)
Upon receipt by an Indemnified Person of actual notice of an Action against such Indemnified Person with respect to which indemnity
may be sought under this Agreement, such Indemnified Person shall promptly notify the Company in writing; provided that failure
by any Indemnified Person so to notify the Company shall not relieve the Company from any liability which the Company may have
on account of this indemnity or otherwise to such Indemnified Person, except to the extent the Company shall have been prejudiced
by such failure. The Company shall, if requested by the Placement Agent, assume the defense of any such Action including the employment
of counsel reasonably satisfactory to the Placement Agent, which counsel may also be counsel to the Company. Any Indemnified Person
shall have the right to employ separate counsel in any such action and participate in the defense thereof, but the fees and expenses
of such counsel shall be at the expense of such Indemnified Person unless: (i) the Company has failed promptly to assume the defense
and employ counsel or (ii) the named parties to any such Action (including any impeded parties) include such Indemnified Person
and the Company, and such Indemnified Person shall have been advised in the reasonable opinion of counsel that there is an actual
conflict of interest that prevents the counsel selected by the Company from representing both the Company (or another client of
such counsel) and any Indemnified Person; provided that the Company shall not in such event be responsible hereunder for the fees
and expenses of more than one firm of separate counsel for all Indemnified Persons in connection with any Action or related Actions,
in addition to any local counsel. The Company shall not be liable for any settlement of any Action effected without its written
consent (which shall not be unreasonably withheld). In addition, the Company shall not, without the prior written consent of the
Placement Agent (which shall not be unreasonably withheld), settle, compromise or consent to the entry of any judgment in or otherwise
seek to terminate any pending or threatened Action in respect of which indemnification or contribution may be sought hereunder
(whether or not such Indemnified Person is a party thereto) unless such settlement, compromise, consent or termination includes
an unconditional release of each Indemnified Person from all Liabilities arising out of such Action for which indemnification
or contribution may be sought hereunder. The indemnification required hereby shall be made by periodic payments of the amount
thereof during the course of the investigation or defense, as such expense, loss, damage or liability is incurred and is due and
payable.

 

(c)
In the event that the foregoing indemnity is unavailable to an Indemnified Person other than in accordance with this Agreement,
the Company shall contribute to the Liabilities and Expenses paid or payable by such Indemnified Person in such proportion as
is appropriate to reflect (i) the relative benefits to the Company, on the one hand, and to the Placement Agent and any other
Indemnified Person, on the other hand, of the matters contemplated by this Agreement or (ii) if the allocation provided by the
immediately preceding clause is not permitted by applicable law, not only such relative benefits but also the relative fault of
the Company, on the one hand, and the Placement Agent and any other Indemnified Person, on the other hand, in connection with
the matters as to which such Liabilities or Expenses relate, as well as any other relevant equitable considerations; provided
that in no event shall the Company contribute less than the amount necessary to ensure that all Indemnified Persons, in the aggregate,
are not liable for any Liabilities and Expenses in excess of the amount of fees actually received by the Placement Agent pursuant
to this Agreement. For purposes of this paragraph, the relative benefits to the Company, on the one hand, and to the Placement
Agent on the other hand, of the matters contemplated by this Agreement shall be deemed to be in the same proportion as (a) the
total value paid or contemplated to be paid to or received or contemplated to be received by the Company in the transaction or
transactions that are within the scope of this Agreement, whether or not any such transaction is consummated, bears to (b) the
fees paid to the Placement Agent under this Agreement. Notwithstanding the above, no person guilty of fraudulent misrepresentation
within the meaning of Section 11(f) of the Securities Act, as amended, shall be entitled to contribution from a party who was
not guilty of fraudulent misrepresentation.

 

    	 	20	 

    	 

    

 

(d)
The Company also agrees that no Indemnified Person shall have any liability (whether direct or indirect, in contract or tort or
otherwise) to the Company for or in connection with advice or services rendered or to be rendered by any Indemnified Person pursuant
to this Agreement, the transactions contemplated thereby or any Indemnified Person’s actions or inactions in connection
with any such advice, services or transactions except for Liabilities (and related Expenses) of the Company that are finally judicially
determined to have resulted from such Indemnified Person’s fraud, gross negligence or willful misconduct in connection with
any such advice, actions, inactions or services.

 

(e)
The reimbursement, indemnity and contribution obligations of the Company set forth herein shall apply to any modification of this
Agreement and shall remain in full force and effect regardless of any termination of, or the completion of any Indemnified Person’s
services under or in connection with, this Agreement.

 

	8.	Representations
    and Indemnities to Survive Delivery. The respective indemnities, agreements, representations, warranties and other statements
    of the Company or any person controlling the Company, of its officers, and of the Placement Agent set forth in or made pursuant
    to this Agreement will remain in full force and effect, regardless of any investigation made by or on behalf of the Placement
    Agent, the Company, or any of its or their partners, officers or directors or any controlling person, as the case may be,
    and will survive delivery of and payment for the Securities sold hereunder and any termination of this Agreement. A successor
    to a Placement Agent, or to the Company, its directors or officers or any person controlling the Company, shall be entitled
    to the benefits of the indemnity, contribution and reimbursement agreements contained in this Agreement. 
	 	 
	9.	Notices.
    All communications hereunder shall be in writing and shall be mailed, hand delivered or telecopied and confirmed to the parties
    hereto as follows: 

 

If
to the Placement Agent to the address set forth above, attention: Mr. John W. Chambers, President & Head of Investment Banking,
Facsimile: (212) 214-0803.

 

With
a copy to:

 

Sichenzia
Ross Ference LLP

1185
Avenue of the Americas, 37th Floor

New
York, NY 10036 Facsimile: (212) 930-9725

Attention:
Gregory Sichenzia, Esq.

 

If
to the Company:

 

Medical
Transcription Billing, Corp.

7
Clyde Road

Somerset,
NJ 08873

Facsimile:
(732) 227-8575

Attention:
General Counsel and Corporate Secretary

 

    	 	21	 

    	 

    

 

With
a copy to: 

 

Song
P.C.

444
Madison Avenue, 4th Floor

New
York, NY 10022

Facsimile:
(212) 599-8400

Attention:
David S. Song, Esq.

 

	10.	Any
    party hereto may change the address for receipt of communications by giving written notice to the others
	 	 
	11.	Successors.
    This Agreement will inure to the benefit of and be binding upon the parties hereto, and to the benefit of the employees, officers
    and directors and controlling persons referred to in Section 7 hereof, and to their respective successors, and personal representative,
    and no other person will have any right or obligation hereunder. 
	 	 
	12.	Partial
    Unenforceability. The invalidity or unenforceability of any section, paragraph or provision of this Agreement shall not
    affect the validity or enforceability of any other section, paragraph or provision hereof. If any Section, paragraph or provision
    of this Agreement is for any reason determined to be invalid or unenforceable, there shall be deemed to be made such minor
    changes (and only such minor changes) as are necessary to make it valid and enforceable. 
	 	 
	13.	Governing
    Law Provisions. This Agreement shall be deemed to have been made and delivered in New York City and both this Agreement
    and the transactions contemplated hereby shall be governed as to validity, interpretation, construction, effect and in all
    other respects by the internal laws of the State of New York, without regard to the conflict of laws principles thereof. Each
    of the Placement Agent and the Company: (i) agrees that any legal suit, action or proceeding arising out of or relating to
    this Agreement and/or the transactions contemplated hereby shall be instituted exclusively in New York Supreme Court, County
    of New York, or in the United States District Court for the Southern District of New York, (ii) waives any objection which
    it may have or hereafter to the venue of any such suit, action or proceeding, and (iii) irrevocably consents to the jurisdiction
    of the New York Supreme Court, County of New York, and the United States District Court for the Southern District of New York
    in any such suit, action or proceeding. Each of the Placement Agent and the Company further agrees to accept and acknowledge
    service of any and all process which may be served in any such suit, action or proceeding in the New York Supreme Court, County
    of New York, or in the United States District Court for the Southern District of New York and agrees that service of process
    upon the Company mailed by certified mail to the Company’s address shall be deemed in every respect effective service
    of process upon the Company, in any such suit, action or proceeding, and service of process upon the Placement Agent mailed
    by certified mail to the Placement Agent’s address shall be deemed in every respect effective service process upon the
    Placement Agent, in any such suit, action or proceeding. Notwithstanding any provision of this Agreement to the contrary,
    the Company agrees that neither the Placement Agent nor its affiliates, and the respective officers, directors, employees,
    agents and representatives of the Placement Agent, its affiliates and each other person, if any, controlling the Placement
    Agent or any of its affiliates, shall have any liability (whether direct or indirect, in contract or tort or otherwise) to
    the Company for or in connection with this Agreement and the transactions described herein except for any such liability for
    losses, claims, damages or liabilities incurred by us that are finally judicially determined to have resulted from the bad
    faith or gross negligence of such individuals or entities. If either party shall commence an action or proceeding to enforce
    any provision of this Agreement, then the prevailing party in such action or proceeding shall be reimbursed by the other party
    for its reasonable attorney’s fees and other costs and expenses incurred with the investigation, preparation and prosecution
    of such action or proceeding. 

 

    	 	22	 

    	 

    

 

Section
13. General Provisions.

 

(a)
This Agreement constitutes the entire agreement of the parties to this Agreement and supersedes all prior written or oral and
all contemporaneous oral agreements, understandings and negotiations with respect to the subject matter hereof, except for the
engagement agreements entered into by and between the Company and the Placement Agent, dated as of May 10, 2017, May 22, 2017,
June 22, 2017, September 25, 2017, December 5, 2017, March 22, 2018 and September 21, 2018, which shall survive the execution
of this Agreement. This Agreement may be executed in two or more counterparts, each one of which shall be an original, with the
same effect as if the signatures thereto and hereto were upon the same instrument. This Agreement may not be amended or modified
unless in writing by all of the parties hereto, and no condition herein (express or implied) may be waived unless waived in writing
by each party whom the condition is meant to benefit. Section headings herein are for the convenience of the parties only and
shall not affect the construction or interpretation of this Agreement.

 

(b)
The Company acknowledges that in connection with the offering of the Securities: (i) the Placement Agent has acted at arms length,
are not agents of, and owe no fiduciary duties to the Company or any other person, (ii) the Placement Agent owes the Company only
those duties and obligations set forth in this Agreement and (iii) the Placement Agent may have interests that differ from those
of the Company. The Company waives to the full extent permitted by applicable law any claims it may have against the Placement
Agent arising from an alleged breach of fiduciary duty in connection with the offering of the Securities

 

[The
remainder of this page has been intentionally left blank.]

 

    	 	23	 

    	 

    

 

If
the foregoing is in accordance with your understanding of our agreement, please sign below whereupon this instrument, along with
all counterparts hereof, shall become a binding agreement in accordance with its terms.

 

	 	Very
truly yours,
	 	 
	 	MEDICAL
    TRANSCRIPTION BILLING, CORP.
	 	 	 
	 	By:	                        
	 	Name:	 
	 	Title:	 

 

The
foregoing Placement Agency Agreement is hereby confirmed and accepted as of the date first above written.

 

	H.C.
    Wainwright & Co., LLC	 
	 	 	 
	By:
    	                                       	 
	Name:	 	 
	Title:	 	 

 

    	 	24

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