Document:

Form of Aames Investment Indemnification Agreement

 Exhibit 10.5 
  
 INDEMNIFICATION AGREEMENT 
  
 THIS INDEMNIFICATION AGREEMENT is made and entered into this          day of
                , 2004 (“Agreement”), by and between Aames Investment Corporation, a Maryland corporation (the “Company”), and
                                        
         (“Indemnitee”). 
  
 RECITALS 
  
 A. The Company
and Indemnitee recognize the increasing difficulty in obtaining directors’ and officers’ liability insurance, the significant increases in the cost of such insurance and the general reductions in the coverage of such insurance. 

 
 B. The Company and Indemnitee further recognize the substantial increase
in corporate litigation in general, subjecting officers and directors to expensive litigation risk at the same time that the availability and coverage of liability insurance has been severely limited. 
  
 C. Indemnitee does not regard the current protection available as adequate
under the present circumstances, and Indemnitee and other officers and directors of the Company may not be willing to continue to serve as officers and directors without the protection provided by this Agreement. 
  
 D. The Company desires to attract and retain the services of highly qualified
individuals, such as Indemnitee, to serve as officers and directors of the Company and to indemnify its officers and directors so as to provide them with the maximum protection permitted by law. 
  
 AGREEMENT 
  
 The Company and Indemnitee hereby agree as follows: 
  
 1. Definitions. For purposes of this Agreement: 
  
 1.1 “Change in Control” means a change in control of the Company that occurs after the Effective
Date, that must be reported under Item 6(e) of Schedule 14A of Regulation 14A under the Securities Exchange Act of 1934, as amended (the “Act”), or in response to any similar item on any similar schedule or form, whether or not the Company
is then subject to such reporting requirement. A Change in Control will be deemed to have occurred if after the Effective Date any of the following events occur: 
  
 A. any “person” (as such term is used in Sections 13(d) and 14(d) of the Act) is or becomes the
“beneficial owner” (as defined in Rule 13d-3 under the Act), directly or indirectly, of the Company’s securities representing [    ] or more of the combined voting power of the Company’s then
outstanding securities without the prior approval of at least two- 

 
thirds of the members of the Board of Directors in office immediately prior to such person attaining such percentage interest; 
  
 B. a proxy contest occurs, or the Company is a party to a
merger, consolidation, sale of assets, plan of liquidation or other reorganization not approved by at least two-thirds of the members of the Board of Directors then in office, as a consequence of which members of the Board of Directors in office
immediately prior to such transaction or event constitute less than a majority of the Board of Directors thereafter; or 
  
 C. during any consecutive two-year period, other than as a result of an event described in Section 1.1(B), individuals who at the
beginning of such period constituted the Board of Directors (including for this purpose any new director whose election or nomination for election by the Company’s stockholders was approved by a vote of at least two-thirds of the directors then
still in office who were directors at the beginning of such period) cease for any reason to constitute at least a majority of the Board of Directors. 
  
 1.2 “Corporate Status” means with respect to the Indemnitee the status of such person as a director, trustee, officer, employee
or agent of the Company or of any other corporation, partnership, joint venture, trust, employee benefit plan or other enterprise for which such person is or was serving at the request of the Company. 
  
 1.3 “Disinterested Director” means a director of
the Company who is not and was not a party to the Proceeding for which indemnification is sought by Indemnitee 
  
 1.4 “Effective Date” means the date of this Agreement. 
  
 1.5 “Expenses” includes all reasonable attorneys’ fees, retainers, court costs, transcript
costs, fees of experts, witness fees, travel expenses, duplicating costs, printing and binding costs, telephone charges, postage, delivery service fees, and all other disbursements or expenses of the types customarily incurred, and actually
incurred, in connection with prosecuting, defending, preparing to prosecute or defend, investigating, or being or preparing to be a witness in a Proceeding. 
  
 1.6 “Independent Counsel” means a law firm, or a member of a law firm, that is experienced in matters of corporation law and has
not, nor in the past five years has been, retained to represent the Company or Indemnitee in any matter material to either such party, or any other party to or witness in the Proceeding giving rise to a claim for indemnification under this
Agreement. “Independent Counsel” does not include any person who, under the applicable standards of professional conduct then prevailing, would have a conflict of interest in representing either the Company or Indemnitee in an action to
determine Indemnitee’s rights under this Agreement. If a Change of Control has not occurred, the Board of Directors will select the Independent Counsel, with the approval of Indemnitee, which approval will not be unreasonably withheld. If a
Change of Control has occurred, the Indemnitee will select Independent Counsel, with the approval of the Board of Directors, which approval will not be unreasonably withheld. 
  
 1.7 “Proceeding” includes any threatened, pending or completed action, suit, arbitration,
alternate dispute resolution mechanism, investigation, administrative hearing or any 

  

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 other proceeding, whether civil, criminal, administrative or investigative (including on appeal), including any such
proceeding (i) pending or completed on or before the Effective Date, or (ii) with respect to any act or omission of the Company or any members of the Company’s board of directors committed prior to the Effective Date, unless otherwise
specifically agreed in writing by the Company and Indemnitee. 
  
 2. Services by Indemnitee. Indemnitee will serve as a [director][officer] of the Company. However, this Agreement does not impose any obligation on Indemnitee or the Company to continue Indemnitee’s service to the
Company beyond any period otherwise required by law or by other agreements or commitments of the parties, if any. 
  
 3. Indemnification—General. The Company will indemnify, and advance Expenses to, Indemnitee as provided in this Agreement and otherwise to the
maximum extent permitted by Maryland law in effect on the date hereof and as amended from time to time. However, no change in Maryland law will have the effect of reducing the benefits available to Indemnitee based on Maryland law as in effect on
the date of this Agreement. The rights of Indemnitee provided in this Section 3 include, without limitation, the rights set forth in the other sections of this Agreement, including any additional indemnification permitted by Section 2-418(g)
of the Maryland General Corporation Law (the “MGCL”). 
  
 4. Third Party Proceedings. Indemnitee is entitled to the rights of indemnification provided in this Section 4 if, by reason of his Corporate Status, he is, or is threatened to be, made a party to or a witness in any
threatened, pending, or completed Proceeding, other than a Proceeding by or in the right of the Company. Under this Section 4, Indemnitee will be indemnified against all judgments, penalties, fines and amounts paid in settlement and all
Expenses actually and reasonably incurred by him or on his behalf in connection with a Proceeding by reason of his Corporate Status unless one of the following is established: 
  
 A. The act or omission of Indemnitee was material to the matter giving rise to the Proceeding, and

  
 1. was committed in bad faith, or 

 
 2. was the result of active and deliberate dishonesty;

  
 B. Indemnitee actually received an improper
personal benefit in money, property or services; or 
  
 C. In the case of any criminal Proceeding, Indemnitee had reasonable cause to believe that his conduct was unlawful. 
  
 5. Proceedings by or in the Right of the Company. Indemnitee is entitled to the rights of indemnification provided in this 
Section 5 if,
by reason of his Corporate Status, he is, or is threatened to be, made a party to or a witness in any threatened, pending or completed Proceeding brought by or in the right of the Company to procure a judgment in its favor. Under this Section
5, Indemnitee will be indemnified against all amounts paid in settlement and all Expenses actually and reasonably incurred by him or on his behalf in connection with such Proceeding, unless one of the following is established: 
  

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 A. The act or omission of Indemnitee was material to the matter giving rise to such a
Proceeding, and 
  
 (1) was committed in bad
faith, or 
  
 (2) was the result of active and
deliberate dishonesty; or 
  
 B. Indemnitee
actually received an improper personal benefit in money, property or services. 
  
 6. Court-Ordered Indemnification. Notwithstanding any other provision of this Agreement, a court of appropriate jurisdiction, upon application of Indemnitee and such notice as the court requires, may order
indemnification in certain circumstances. However, indemnification for any Proceeding by or in the right of the Company, or in which liability has been adjudged in the circumstances described in Section 2-418(c) of the MGCL, will be limited to
Expenses actually and reasonably incurred by Indemnitee or on his behalf in connection with a Proceeding. The circumstances under which a court may order such indemnification as it deems proper are: 
  
 6.1 If it determines that Indemnitee is entitled to
reimbursement under Section 2-418(d)(1) of the MGCL, the court will order indemnification, in which case Indemnitee will be entitled to recover the expenses of securing such reimbursement; or 
  
 6.2 If it determines that Indemnitee is fairly and reasonably
entitled to indemnification in view of all the relevant circumstances, whether or not Indemnitee has: 
  
 A. met the standards of conduct set forth in Section 2-418(b) of the MGCL; or 
  
 B. been adjudged liable for receipt of an improper personal
benefit under Section 2-418(c) of the MGCL. 
  
 7.
Indemnification for Expenses of a Party Who is Wholly or Partly Successful. If Indemnitee is, by reason of his Corporate Status, made a party to and is successful, on the merits or otherwise, in the defense of any Proceeding, he will be
indemnified for all Expenses actually and reasonably incurred by him or on his behalf in connection therewith. If Indemnitee is not wholly successful in such Proceeding but is successful, on the merits or otherwise, as to one or more but less than
all claims, issues or matters in such Proceeding, the Company will indemnify Indemnitee under this Section 7 for all Expenses actually and reasonably incurred by him or on his behalf in connection with each successfully resolved claim, issue
or matter, allocated on a reasonable and proportionate basis. For purposes of this Section 7 and without limitation, the termination of any claim, issue or matter in such a Proceeding by dismissal, with or without prejudice, will be deemed to
be a successful result as to such claim, issue or matter. 
  
 8.
Advance of Expenses. The Company will advance all reasonable Expenses actually and reasonably incurred by or on behalf of Indemnitee in connection with any Proceeding (other than a Proceeding brought to enforce indemnification under this
Agreement, applicable law, the Charter or Bylaws of the Company, any agreement or a resolution of the 
  

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 stockholders entitled to vote generally in the election of directors or of the Board of Directors), to which Indemnitee
is, or is threatened to be, made a party or a witness, within 10 days after the receipt by the Company of a statement or statements from Indemnitee requesting such advance or advances from time to time, whether prior to or after final disposition of
such Proceeding. Such statement or statements must reasonably evidence the Expenses incurred by Indemnitee. The statement or statements must include a written affirmation by Indemnitee of Indemnitee’s good faith belief that the standard of
conduct necessary for indemnification by the Company, as authorized by law and by this Agreement, has been met. The statement or statements must also include a written undertaking by or on behalf of Indemnitee, in substantially the form attached
hereto as Exhibit A, or in such form as may be required under applicable law as in effect at the time the undertaking is signed. The undertaking requires Indemnitee to reimburse the portion of any Expenses advanced to him relating to claims,
issues or matters in the Proceeding for which it is ultimately established that the standard of conduct was not met and which have not been successfully resolved as described in Section 7. To the extent that Expenses advanced to Indemnitee do
not relate to a specific claim, issue or matter in the Proceeding, such Expenses will be allocated on a reasonable and proportionate basis. The undertaking required by this Section 8 will be an unlimited general obligation by or on behalf of
Indemnitee and will be accepted without reference to Indemnitee’s financial ability to repay such advanced Expenses and without any requirement to post security therefor. 
  
 9. Procedure for Determination of Entitlement to Indemnification. 
  
 9.1 To obtain indemnification under this Agreement,
Indemnitee must submit to the Company a written request, including such documentation and information as is reasonably available to Indemnitee and is reasonably necessary to determine whether and to what extent Indemnitee is entitled to
indemnification. The Secretary of the Company will, promptly upon receipt of such a request for indemnification, advise the Board of Directors in writing that Indemnitee has requested indemnification. 
  
 9.2 Upon proper written request for indemnification by
Indemnitee, a determination, if required by applicable law, with respect to Indemnitee’s entitlement to indemnification will promptly be made in the following manner: 
  
 A If a Change in Control has occurred, by Independent Counsel in a written opinion to the Board of
Directors, a copy of which will be delivered to Indemnitee; or 
  
 B. If a Change of Control has not occurred, 
  
 (1) by the Board of Directors (or a duly authorized committee thereof) by a majority vote of a quorum consisting of Disinterested Directors, or 
  
 (2) if a quorum of the Board of Directors consisting of Disinterested Directors is not obtainable or, even
if obtainable, such quorum of Disinterested Directors so directs, by Independent Counsel in a written opinion to the Board of Directors, a copy of which will be delivered to Indemnitee, or 
  
 (3) if so directed by a majority of the members of the Board
of Directors, by the stockholders of the Company. 
  

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 9.3 If it is determined that Indemnitee is entitled to indemnification, payment to Indemnitee will be
made within 10 days after such determination. Indemnitee will cooperate with the person, persons or entity making such determination with respect to Indemnitee’s entitlement to indemnification, including providing to such person, persons or
entity, upon reasonable advance request, any documentation or information that is not privileged or otherwise protected from disclosure, and that is reasonably available to Indemnitee and reasonably necessary to such determination in the discretion
of the Board of Directors or Independent Counsel if retained pursuant to Section 9.2(B). Any Expenses actually and reasonably incurred by Indemnitee in cooperating with the person, persons or entity making such determination will be borne by
the Company (irrespective of the determination as to Indemnitee’s entitlement to indemnification) and the Company will indemnify and hold Indemnitee harmless therefrom. 
  
 9.4 Indemnitee will select the Independent Counsel. The Company may, within 10 days after written notice of such selection,
deliver to Indemnitee a written objection to such selection, but such objection may be asserted only on the grounds that the selected Independent Counsel does not meet the requirements of “Independent Counsel” as defined in this Agreement.
Absent a proper and timely objection, the person so selected will act as Independent Counsel. If written objection is made and substantiated, the selected Independent Counsel may not serve unless and until the objection is withdrawn or a court
determines that the objection is without merit. If no Independent Counsel has been selected and not objected to within 20 days after the later of submission by Indemnitee of a written request for indemnification and the final disposition of the
Proceeding, Indemnitee may petition a court of competent jurisdiction for resolution of any objection that has been made by the Company to the selection of Independent Counsel, or for the appointment as Independent Counsel of a person selected by
the court or by such other person that the court may designate. The person with respect to whom all objections are so resolved or the person so appointed will act as Independent Counsel. Upon the due commencement of any judicial proceeding or
arbitration under Section 11.1, Independent Counsel will be discharged and relieved of any further responsibility in such capacity – subject to the then-prevailing applicable standards of professional conduct. 
  
 10. Presumptions and Effect of Certain Proceedings. 
  
 10.1 In making a determination with respect to entitlement to indemnification
hereunder, the person or persons or entity making such determination must presume that Indemnitee is entitled to indemnification under this Agreement if Indemnitee has submitted a request for indemnification in accordance with Section 9.1.
The Company will have the burden of proof to overcome that presumption in connection with the making of any determination contrary to that presumption. 
  
 10.2 The termination of any Proceeding by judgment, order, settlement, conviction, a plea of nolo contendere or its equivalent, or an entry
of an order of probation prior to judgment, does not create a presumption that Indemnitee did not meet the requisite standard of conduct described herein for indemnification. 
  

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 11. Remedies of Indemnitee. 
  
 11.1 Indemnitee will be entitled to an adjudication in an appropriate court located in the State of
Maryland, or in any other court of competent jurisdiction, of his entitlement to such indemnification or advance of Expenses if any of the following occur: 
  
 A. A determination is made pursuant to Section 9 of this Agreement that Indemnitee is not entitled to indemnification under this
Agreement; 
  
 B. Advance of Expenses is not
timely made pursuant to Section 8 of this Agreement; 
  
 C. No determination of entitlement to indemnification has been made pursuant to Section 9.2 of this Agreement within [            ] days after
receipt by the Company of the request for indemnification; 
  
 D. Payment of indemnification is not made pursuant to Section 7 of this Agreement within 10 days after receipt by the Company of a written request therefor; or 
  
 E. Payment of indemnification is not made within 10 days
after a determination has been made that Indemnitee is entitled to indemnification. 
  
 11.2 As an alternative to the remedy described in Section 11.1, Indemnitee, at his option, may seek an award in arbitration to be conducted by a single arbitrator pursuant to the commercial Arbitration Rules of
the American Arbitration Association. Indemnitee must commence such proceeding for adjudication or an award in arbitration within 180 days following the date on which Indemnitee first has the right to commence such proceeding under Section
11.1. However, the remedies under Section 11.1 and Section 11.2 do not apply to a proceeding brought by Indemnitee to enforce his rights under Section 7. 
  
 11.3 In any judicial proceeding or arbitration commenced pursuant to this Section 11 the Company has the burden of
proving that Indemnitee is not entitled to indemnification or advance of Expenses, as the case may be. 
  
 11.4 If a determination has been made under Section 9.2 of this Agreement that Indemnitee is entitled to indemnification, the Company will be bound
by such determination in any judicial proceeding or arbitration commenced pursuant to this Section 11, unless Indemnitee makes a misstatement of a material fact, or omits a material fact necessary to make Indemnitee’s statement not
materially misleading, in connection with the request for indemnification. 
  
 11.5 If Indemnitee seeks a judicial adjudication of or an award in arbitration to enforce his rights under, or to recover damages for breach of, this Agreement, under this Section 11, then Indemnitee will be
entitled to recover from the Company, and will be indemnified by the Company for, any and all Expenses actually and reasonably incurred by him in such judicial adjudication or arbitration. If it is determined in such judicial adjudication or
arbitration that Indemnitee is entitled to receive part but not all of the indemnification or advance of Expenses sought, the Expenses incurred by Indemnitee in connection with such judicial adjudication or arbitration will be appropriately
prorated. 
  

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 12. Defense of the Underlying Proceeding. 
  
 12.1 Indemnitee must notify the Company promptly upon being
served with or receiving any summons, citation, subpoena, complaint, indictment, information, notice, request or other document relating to any Proceeding that may result in the right to indemnification or the advance of Expenses hereunder. However,
the failure to give any such notice will not disqualify Indemnitee from the right, or otherwise affect in any manner any right of Indemnitee, to indemnification or the advance of Expenses under this Agreement unless the Company’s ability to
defend in such Proceeding or to obtain proceeds under any insurance policy is materially and adversely prejudiced thereby, and then only to the extent the Company is actually so prejudiced. 
  
 12.2 Subject to the provisions of the last sentence of this
Section and of Section 12.3, the Company will have the right to defend Indemnitee in any Proceeding that may give rise to indemnification hereunder. However, the Company must notify Indemnitee of any such decision to defend within 15 calendar
days following receipt of notice of any such Proceeding under Section 12.1. The Company may not, without the prior written consent of Indemnitee, which may not be unreasonably withheld or delayed, consent to the entry of any judgment against
Indemnitee, or enter into any settlement or compromise that (A) includes an admission of Indemnitee’s fault or (B) does not include, as an unconditional term, the full release of Indemnitee from all liability in respect of such Proceeding. Such
release must be in form and substance reasonably satisfactory to Indemnitee. This Section 12.2 does not apply to a Proceeding brought by Indemnitee under Section 11 or Section 18. 
  
 12.3 Indemnitee will be entitled to representation by
separate legal counsel of Indemnitee’s choice, subject to the Company’s prior approval, which may not be unreasonably withheld, at the expense of the Company, in a Proceeding to which Indemnitee is a party by reason of Indemnitee’s
Corporate Status, in the following circumstances: 
  
 A. Indemnitee reasonably concludes, based upon an opinion of counsel approved by the Company, which approval may not be unreasonably withheld, that he may have separate defenses or counterclaims to assert with respect to any issue that may
not be consistent with other defendants in such Proceeding; 
  
 B. Indemnitee reasonably concludes, based upon an opinion of counsel approved by the Company, which approval may not be unreasonably withheld, that an actual or apparent conflict of interest or potential conflict of
interest exists between Indemnitee and the Company; 
  
 C. If the Company fails to assume the defense of such Proceeding in a timely manner; or 
  
 D. If the Company fails to comply with any of its obligations under this Agreement or the Company or any other person takes any action to
declare this Agreement void or unenforceable, or institutes any Proceeding to deny or to recover from Indemnitee the benefits intended to be provided to Indemnitee under this Agreement. 
  

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 13. Non-Exclusivity; Survival of Rights; Subrogation; Insurance. 
  
 13.1 The rights of indemnification and advance of Expenses
provided by this Agreement will not be deemed exclusive of any other rights to which Indemnitee may at any time be entitled under applicable law, the Charter or Bylaws of the Company, any agreement or a resolution of the stockholders entitled to
vote generally in the election of directors or of the Board of Directors, or otherwise. No amendment, alteration or repeal of this Agreement or of any provision hereof may limit or restrict any right of Indemnitee under this Agreement in respect of
any action taken or omitted by such Indemnitee in his Corporate Status prior to such amendment, alteration or repeal. 
  
 13.2 If any payment is made under this Agreement, the Company will be subrogated to the extent of such payment to all of the rights of
recovery of Indemnitee, who will execute all papers required and take all action necessary to secure such rights, including execution of such documents as are necessary to enable the Company to bring suit to enforce such rights. 
  
 13.3 The Company will not be liable under this Agreement to
make any payment of amounts otherwise indemnifiable or payable or reimbursable as Expenses hereunder if and to the extent that Indemnitee has otherwise actually received such payment under any insurance policy, contract, agreement or otherwise.

  
 14. Insurance. The Company will use its reasonable best
efforts to acquire directors and officers liability insurance, on terms and conditions deemed appropriate by the Board of Directors of the Company, with the advice of counsel, covering Indemnitee or any claim made against Indemnitee for service as a
director or officer of the Company and covering the Company for any indemnification or advance of Expenses made by the Company to Indemnitee for any claims made against Indemnitee for service as a director or officer of the Company. Without limiting
any other obligation under this Agreement, the Company will indemnify Indemnitee for any payment by Indemnitee arising out of the amount of any deductible or retention and the amount of any excess of the aggregate of all judgments, penalties, fines,
settlements and reasonable Expenses actually and reasonably incurred by Indemnitee in connection with a Proceeding over the coverage of any insurance referred to in the previous sentence. 
  
 15. Indemnification for Expenses of a Witness. Notwithstanding any other provision of this Agreement, if Indemnitee
is or may be, by reason of his Corporate Status, a witness in any Proceeding, whether instituted by the Company or any other party, and to which Indemnitee is not a party but in which the Indemnitee receives a subpoena to testify, he will be
advanced all reasonable Expenses and indemnified against all Expenses actually and reasonably incurred by him or on his behalf in connection therewith. 
  
 16. Duration of Agreement; Binding Effect. 
  
 16.1 This Agreement will terminate 10 years after the date that Indemnitee’s Corporate Status ceases. However, the rights of
Indemnitee hereunder will continue until the final termination of any Proceeding then pending in respect of which Indemnitee is granted rights 

  

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of indemnification or advance of Expenses hereunder and of any proceeding commenced by Indemnitee pursuant to Section 11 of this Agreement relating
thereto. 
  
 16.2 The indemnification and advance
of Expenses provided by, or granted under, this Agreement will be binding upon and enforceable by the parties hereto and their respective successors and assigns (including any direct or indirect successor by purchase, merger, consolidation or
otherwise to all or substantially all of the business or assets of the Company). The indemnification and advance of Expenses will continue as to an Indemnitee who has ceased to be a director, trustee, officer, employee or agent of the Company or of
any other corporation, partnership, joint venture, trust, employee benefit plan or other enterprise that such person is or was serving at the written request of the Company, and will inure to the benefit of Indemnitee and his spouse, assigns, heirs,
devisees, executors and administrators and other legal representatives. 
  
 16.3 The Company will require and cause any successor to all, substantially all or a substantial part, of the business and/or assets of the Company – whether direct or indirect by purchase, merger, consolidation
or otherwise – to expressly assume and agree to perform this Agreement in the same manner and to the same extent that the Company would be required to perform if no such succession had taken place. Such assumption by any successor must be in
writing in form and substance satisfactory to Indemnitee. 
  
 17. Severability. If any provision or provisions of this Agreement are held to be invalid, illegal or unenforceable for any reason whatsoever, the validity, legality and enforceability of the remaining
provisions of this Agreement (including, without limitation, each portion of any section of this Agreement containing any such provision held to be invalid, illegal or unenforceable that is not itself invalid, illegal or unenforceable) will not in
any way be affected or impaired thereby. To the fullest extent possible, the provisions of this Agreement (including, without limitation, each portion of any section of this Agreement containing any such provision held to be invalid, illegal or
unenforceable, that is not itself invalid, illegal or unenforceable) will be construed so as to give effect to the intent manifested thereby. 
  
 18. Exception to Right of Indemnification or Advance of Expenses. Notwithstanding any other provision of this Agreement, Indemnitee
will not be entitled to indemnification or advance of Expenses under this Agreement with respect to any Proceeding brought by Indemnitee, unless: 
  
 A. The Proceeding is brought to enforce indemnification under this Agreement, and then only to the extent in accordance with and as
authorized by Sections 8 and 11 of this Agreement; or 
  
 B. The Company’s Bylaws, the Charter, a resolution of the stockholders entitled to vote generally in the election of directors or of the Board of Directors or an agreement approved by the Board of Directors to
which the Company is a party expressly provide otherwise. 
  
 19.
Identical Counterparts. This Agreement may be executed in one or more counterparts, each of which will be deemed to be an original but all of which together will 

  

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constitute one and the same Agreement. One such counterpart signed by the party against whom enforceability is sought will be sufficient to evidence the
existence of this Agreement. 
  
 20. Headings. The headings
of the paragraphs of this Agreement are inserted for convenience only and will not be deemed to constitute part of this Agreement or to affect the construction thereof. 
  
 21. Modification and Waiver. No supplement, modification or amendment of this Agreement will be binding unless
executed in writing by both of the parties hereto. No waiver of any of the provisions of this Agreement will be deemed or constitute a waiver of any other provisions hereof (whether or not similar), nor will such waiver constitute a continuing
waiver. 
  
 22. Notices. Addresses for notice to either
party are as shown on the signature pages of this Agreement, or as later modified by written notice. All notices, requests, demands and other communications hereunder must be in writing and will be deemed to have been duly given if: 
  
 A. Delivered by hand and receipted for by the party to whom
said notice or other communication has been directed; or 
  
 B. Mailed by certified or registered mail with postage prepaid, on the third business day after the date on which it is so mailed. 
  
 23. Governing Law. The parties agree that this Agreement shall be governed by, and construed and enforced in
accordance with, the laws of the State of Maryland, without regard to its conflicts of laws rules. 
  
 24. Miscellaneous. Use of the masculine pronoun will be deemed to include usage of the feminine pronoun where appropriate. 
  
 [SIGNATURE PAGE FOLLOWS] 
  

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 IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the day and year first above
written. 
  

							
	ATTEST:	  	AAMES INVESTMENT CORPORATION,	  	 
	 	  	a Maryland corporation	  	 
	 	  	 	 	 	  	 
	 	  	 	 	 	  	 
	 	  	By:	 	 	  	(SEAL)
	 	  	Name:	  	 
	 	  	Title:	  	 
	 	  	 	 	 	  	 
	 	  	 	 	 	  	 
	 WITNESS:
	  	INDEMNITEE:	  	 
	 	  	 	 	 	  	 
	 	  	 	 	 	  	 
	 	  	 	 	 	  	 
	 	  	Name:	  	 
	 	  	Address:	  	 

  

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 EXHIBIT A 
  

FORM OF UNDERTAKING TO REPAY EXPENSES ADVANCED 
  
 The Board of Directors of Aames Investment Corporation 
 Re: Undertaking to Repay Expenses Advanced 
  
 Ladies and Gentlemen: 
  
 This undertaking is being provided pursuant to that certain Indemnification Agreement dated the      day of
                        , 2004, by and between Aames Investment Corporation (the “Company”) and the undersigned
Indemnitee (the “Indemnification Agreement”), pursuant to which I am entitled to advance of expenses in connection with [Description of Proceeding] (the “Proceeding”). 
  
 Terms used herein and not otherwise defined have the meanings specified in
the Indemnification Agreement. 
  
 I am subject to the Proceeding
by reason of my Corporate Status or by reason of alleged actions or omissions by me in such capacity. I hereby affirm that at all times, insofar as I was involved as [a director] [an officer] of the Company, in any of the facts or
events giving rise to the Proceeding, I (1) acted in good faith and honestly, (2) did not receive any improper personal benefit in money, property or services and (3) in the case of any criminal proceeding, had no reasonable cause to believe that
any act or omission by me was unlawful. 
  
 In consideration of
the advance of Expenses by the Company for reasonable attorneys’ fees and related expenses incurred by me in connection with the Proceeding (the “Advanced Expenses”), I hereby agree that if, in connection with the Proceeding, it is
established that (1) an act or omission by me was material to the matter giving rise to the Proceeding and (a) was committed in bad faith or (b) was the result of active and deliberate dishonesty or (2) I actually received an improper personal
benefit in money, property or services or (3) in the case of any criminal proceeding, I had reasonable cause to believe that the act or omission was unlawful, then I must promptly reimburse the portion of the Advanced Expenses relating to the
claims, issues or matters in the Proceeding as to which the foregoing findings have been established and which have not been successfully resolved as described in Section 7 of the Indemnification Agreement. To the extent that Advanced
Expenses do not relate to a specific claim, issue or matter in the Proceeding, I agree that such Expenses will be allocated on a reasonable and proportionate basis. 
  
 IN WITNESS WHEREOF, I have executed this Affirmation and Undertaking on this      day of
                        , 200  . 
  
  

			
	 WITNESS:
  
                                       
                          
	  	                                      
                                  (SEAL)Securities Purchase Agreement

 Exhibit 10.1 
  
 DYNAMIC HEALTH PRODUCTS, INC. 
  

SECURITIES PURCHASE AGREEMENT 
  
 September 30, 2004 

 TABLE OF CONTENTS 
  

							
	 	  	 	 	 	  	Page

	 1.
	  	Agreement to Sell and Purchase	  	1
			
	 2.
	  	Fees and Warrant	  	1
			
	 3.
	  	Closing, Delivery and Payment.	  	2
	 	  	3.1	 	Closing	  	2
	 	  	3.2	 	Delivery	  	2
			
	 4.
	  	Representations and Warranties of the Company	  	2
	 	  	4.1	 	Organization, Good Standing and Qualification	  	2
	 	  	4.2	 	Subsidiaries	  	3
	 	  	4.3	 	Capitalization; Voting Rights	  	4
	 	  	4.4	 	Authorization; Binding Obligations	  	4
	 	  	4.5	 	Liabilities	  	5
	 	  	4.6	 	Agreements; Action	  	5
	 	  	4.7	 	Obligations to Related Parties	  	6
	 	  	4.8	 	Changes	  	6
	 	  	4.9	 	Title to Properties and Assets; Liens, Etc.	  	7
	 	  	4.10	 	Intellectual Property	  	8
	 	  	4.11	 	Compliance with Other Instruments	  	8
	 	  	4.12	 	Litigation	  	9
	 	  	4.13	 	Tax Returns and Payments	  	9
	 	  	4.14	 	Employees	  	9
	 	  	4.15	 	Registration Rights and Voting Rights	  	10
	 	  	4.16	 	Compliance with Laws; Permits	  	10
	 	  	4.17	 	Environmental and Safety Laws	  	10
	 	  	4.18	 	Valid Offering	  	11
	 	  	4.19	 	Full Disclosure	  	11
	 	  	4.20	 	Insurance	  	11
	 	  	4.21	 	SEC Reports	  	11
	 	  	4.22	 	Listing	  	12
	 	  	4.23	 	No Integrated Offering	  	12
	 	  	4.24	 	Stop Transfer	  	12
	 	  	4.25	 	Dilution	  	12
	 	  	4.26	 	Patriot Act	  	12
			
	 5.
	  	Representations and Warranties of the Purchaser	  	13
	 	  	5.1	 	No Shorting	  	13
	 	  	5.2	 	Requisite Power and Authority	  	13
	 	  	5.3	 	Investment Representations	  	13
	 	  	5.4	 	Purchaser Bears Economic Risk	  	14
	 	  	5.5	 	Acquisition for Own Account	  	14
	 	  	5.6	 	Purchaser Can Protect Its Interest	  	14
	 	  	5.7	 	Accredited Investor	  	14
	 	  	5.8	 	Legends	  	14

  

 i 

							
	 6.
	  	Covenants of The Company	  	15
	 	  	6.1	 	Stop-Orders	  	15
	 	  	6.2	 	Listing	  	15
	 	  	6.3	 	Market Regulations	  	 
	 	  	6.4	 	Reporting Requirements	  	16
	 	  	6.5	 	Use of Funds	  	16
	 	  	6.6	 	Access to Facilities	  	16
	 	  	6.7	 	Taxes	  	16
	 	  	6.8	 	Insurance	  	17
	 	  	6.9	 	Intellectual Property	  	18
	 	  	6.10	 	Properties	  	18
	 	  	6.11	 	Confidentiality	  	18
	 	  	6.12	 	Required Approvals	  	18
	 	  	6.13	 	Reissuance of Securities	  	19
	 	  	6.14	 	Opinion	  	19
	 	  	6.15	 	Margin Stock	  	20
	 	  	6.16	 	Financing Right of First Refusal	  	20
			
	 7.
	  	Covenants of the Purchaser	  	20
	 	  	7.1	 	Confidentiality	  	20
	 	  	7.2	 	Non-Public Information	  	20
			
	 8.
	  	Covenants of the Company and Purchaser Regarding Indemnification	  	21
	 	  	8.1	 	Company Indemnification	  	21
	 	  	8.2	 	Purchaser’s Indemnification	  	21
			
	 9.
	  	Conversion of Convertible Note	  	21
	 	  	9.1	 	Mechanics of Conversion	  	21
			
	 10.
	  	Registration Rights.	  	23
	 	  	10.1	 	Registration Rights Granted	  	23
	 	  	10.2	 	Offering Restrictions	  	23
			
	 11.
	  	Miscellaneous	  	23
	 	  	11.1	 	Governing Law	  	23
	 	  	11.2	 	Survival	  	23
	 	  	11.3	 	Successors	  	24
	 	  	11.4	 	Entire Agreement	  	24
	 	  	11.5	 	Severability	  	24
	 	  	11.6	 	Amendment and Waiver	  	24
	 	  	11.7	 	Delays or Omissions	  	24
	 	  	11.8	 	Notices	  	24
	 	  	11.9	 	Attorneys’ Fees	  	25
	 	  	11.10	 	Titles and Subtitles	  	26
	 	  	11.11	 	Facsimile Signatures; Counterparts	  	26
	 	  	11.12	 	Broker’s Fees	  	26
	 	  	11.13	 	Construction	  	26

  

 ii 

 LIST OF EXHIBITS 
  

			
	 Form of Convertible Term Note
	  	Exhibit A
	 Form of Warrant
	  	Exhibit B
	 Form of Opinion
	  	Exhibit C
	 Form of Escrow Agreement
	  	Exhibit D

  

 iii 

 SECURITIES PURCHASE AGREEMENT 
  
 THIS SECURITIES PURCHASE AGREEMENT (this “Agreement”) is made and entered into as of September 30, 2004, by and
between Dynamic Health Products, Inc., a Florida corporation (the “Company”), and Laurus Master Fund, Ltd., a Cayman Islands company (the “Purchaser”). 
  
 RECITALS 
  
 WHEREAS, the Company has authorized the sale to the Purchaser of a Convertible Term Note in the aggregate principal amount of Six Million Dollars
($6,000,000) (as amended, modified or supplemented from time to time, the “Note”), which Note is convertible into shares of the Company’s common stock, $0.01 par value per share (the “Common Stock”) at an initial fixed
conversion price of $ [    ] per share of Common Stock (“Fixed Conversion Price”); 
  
 WHEREAS, the Company wishes to issue a warrant to the Purchaser to purchase up to 1,375,000 shares of the Company’s Common Stock (subject to
adjustment as set forth therein) in connection with Purchaser’s purchase of the Note; 
  
 WHEREAS, Purchaser desires to purchase the Note and the Warrant (as defined in Section 2) on the terms and conditions set forth herein; and 
  
 WHEREAS, the Company desires to issue and sell the Note and Warrant to Purchaser on the terms and conditions set forth
herein. 
  
 AGREEMENT 
  
 NOW, THEREFORE, in consideration of the foregoing recitals and the mutual
promises, representations, warranties and covenants hereinafter set forth and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows: 
  
 1. Agreement to Sell and Purchase. Pursuant to the terms and
conditions set forth in this Agreement, on the Closing Date (as defined in Section 3), the Company agrees to sell to the Purchaser, and the Purchaser hereby agrees to purchase from the Company, a Note in the aggregate principal amount of $6,000,000
convertible in accordance with the terms thereof into shares of the Company’s Common Stock in accordance with the terms of the Note and this Agreement. The Note purchased on the Closing Date shall be known as the “Offering.” A form of
the Note is annexed hereto as Exhibit A. The Note will mature on the Maturity Date (as defined in the Note). Collectively, the Note and Warrant and Common Stock issuable in payment of the Note, upon conversion of the Note and upon exercise of the
Warrant are referred to as the “Securities.” 
  
 2.
Fees and Warrant. On the Closing Date: 
  
 (a) The Company will issue and deliver to the Purchaser a Warrant to purchase up to 1,375,000 shares of Common Stock in connection with the Offering (as amended, modified or supplemented from time to time, the “Warrant”) pursuant
to 

 Section 1 hereof. The Warrant must be delivered on the Closing Date. A form of Warrant is annexed hereto
as Exhibit B. All the representations, covenants, warranties, undertakings, and indemnification, and other rights made or granted to or for the benefit of the Purchaser by the Company are hereby also made and granted in respect of the Warrant and
shares of the Company’s Common Stock issuable upon exercise of the Warrant (the “Warrant Shares”). 
  
 (b) Subject to the terms of Section 2(d) below, the Company shall pay to Laurus Capital Management, L.L.C., the manager of the Purchaser,
a closing payment in an amount equal to three and nine-tenths percent (3.90%) of the aggregate principal amount of the Note. The foregoing fee is referred to herein as the “Closing Payment.” 
  
 (c) The Company shall reimburse the Purchaser for its
reasonable expenses (including legal fees and expenses) incurred in connection with the preparation and negotiation of this Agreement and the Related Agreements (as hereinafter defined), and expenses incurred in connection with the Purchaser’s
due diligence review of the Company and its Subsidiaries (as defined in Section 6.8) and all related matters. Amounts required to be paid under this Section 2(c) will be paid on the Closing Date and shall be $44,500 for such expenses referred to in
this Section 2(c). 
  
 (d) The Closing Payment
and the expenses referred to in the preceding clause (c) (net of deposits previously paid by the Company) shall be paid at closing out of funds held pursuant to the Escrow Agreement (as defined below) and a disbursement letter (the
“Disbursement Letter”). 
  
 3. Closing, Delivery and
Payment. 
  
 3.1 Closing. Subject to the terms and
conditions herein, the closing of the transactions contemplated hereby (the “Closing”), shall take place on the date hereof, at such time or place as the Company and Purchaser may mutually agree (such date is hereinafter referred to as the
“Closing Date”). 
  
 3.2 Delivery. Pursuant to
the Escrow Agreement, at the Closing on the Closing Date, the Company will deliver to the Purchaser, among other things, a Note in the form attached as Exhibit A representing the aggregate principal amount of $6,000,000 and a Warrant in the form
attached as Exhibit B in the Purchaser’s name representing 1,375,000 Warrant Shares and the Purchaser will deliver to the Company, among other things, the amounts set forth in the Disbursement Letter by wire transfer. 
  
 4. Representations and Warranties of the Company. The Company hereby
represents and warrants to the Purchaser as follows (which representations and warranties are supplemented by the Company’s filings under the Securities Exchange Act of 1934 (collectively, the “Exchange Act Filings”), copies of which
have been provided to the Purchaser) : 
  
 4.1 Organization,
Good Standing and Qualification. Each of the Company and each of its Subsidiaries is a corporation, partnership or limited liability company, as the case 
  

 2 

 may be, duly organized, validly existing and in good standing under the laws of its jurisdiction of organization. Each of
the Company and each of its Subsidiaries has the corporate power and authority to own and operate its properties and assets, to execute and deliver (i) this Agreement, (ii) the Note and the Warrant to be issued in connection with this Agreement,
(iii) the Master Security Agreement dated as of the date hereof between the Company, certain Subsidiaries of the Company and the Purchaser (as amended, modified or supplemented from time to time, the “Master Security Agreement”), (iv) the
Registration Rights Agreement relating to the Securities dated as of the date hereof between the Company and the Purchaser (as amended, modified or supplemented from time to time, the “Registration Rights Agreement”), (v) the Subsidiary
Guaranty dated as of the date hereof made by certain Subsidiaries of the Company (as amended, modified or supplemented from time to time, the “Subsidiary Guaranty”), (vi) the Subsidiary Stock Pledge Agreement dated as of the date hereof
among the Company, certain Subsidiaries of the Company and the Purchaser (as amended, modified or supplemented from time to time, the “Subsidiary Stock Pledge Agreement”), (vii) the Funds Escrow Agreement dated as of the date hereof among
the Company, the Purchaser and the escrow agent referred to therein, substantially in the form of Exhibit D hereto (as amended, modified or supplemented from time to time, the “Escrow Agreement”), (viii) those certain agreements related to
the lockbox and clearing account arrangements maintained by the Company and its Subsidiaries at Commerce Bank for the benefit of the Purchaser (as amended, modified or supplemented from time to time, the “Clearing Account Agreements”),
(ix) the Supplemental Stock Pledge Agreement dated as of the date hereof by and between the Company, Pharma Labs RX, Inc. and the Purchaser (as amended, modified or supplemented from time to time, the “Supplemental Stock Pledge
Agreement”), (x) that certain Guaranty made by Jugal K Taneja in favor of the Purchaser dated the date hereof (as amended, modified or supplemented from time to time, the “Supplemental Guaranty”) and (xi) all other agreements related
to this Agreement and the Note and referred to herein (the preceding clauses (ii) through (xi), collectively, the “Related Agreements”), to issue and sell the Note and the shares of Common Stock issuable upon conversion of the Note (the
“Note Shares”), to issue and sell the Warrant and the Warrant Shares, and to carry out the provisions of this Agreement and the Related Agreements and to carry on its business as presently conducted. Each of the Company and each of its
Subsidiaries is duly qualified and is authorized to do business and is in good standing as a foreign corporation, partnership or limited liability company, as the case may be, in all jurisdictions in which the nature of its activities and of its
properties (both owned and leased) makes such qualification necessary, except for those jurisdictions in which failure to do so has not, or could not reasonably be expected to have, individually or in the aggregate, a material adverse effect on the
business, assets, liabilities, condition (financial or otherwise), properties, operations or prospects of the Company or the Company and it Subsidiaries, taken as a whole (a “Material Adverse Effect”). 
  
 4.2 Subsidiaries. Each direct and indirect Subsidiary of the Company,
the direct owner of such Subsidiary and its percentage ownership thereof, is set forth on Schedule 4.2. For the purpose of this Agreement, a “Subsidiary” of any person or entity means (i) a corporation or other entity whose shares
of stock or other ownership interests having ordinary voting power (other than stock or other ownership interests having such power only by reason of the happening of a contingency) to elect a majority of the directors of such corporation, or other
persons or entities performing similar functions for such person or entity, are owned, directly or indirectly, by such person or entity or (ii) a corporation or other entity in which such person or entity owns, directly or indirectly, more than 50%
of the equity interests at such time. 
  

 3 

 4.3 Capitalization; Voting Rights. 
  
 (a) The authorized capital stock of the Company, as of the date hereof consists of 22,000,000 shares, of
which 20,000,000 are shares of Common Stock, par value $0.01 per share, 12,774,834 shares of which are issued and outstanding [, and 2,000,000 are shares of preferred stock, par value $0.01 per share of which 0 shares of preferred stock are issued
and outstanding.] The authorized capital stock of each Subsidiary of the Company is set forth on Schedule 4.3. 
  
 (b) Except as disclosed on Schedule 4.3, other than: (i) the shares reserved for issuance under the Company’s stock option plans; and
(ii) shares which may be granted pursuant to this Agreement and the Related Agreements, there are no outstanding options, warrants, rights (including conversion or preemptive rights and rights of first refusal), proxy or stockholder agreements, or
arrangements or agreements of any kind for the purchase or acquisition from the Company of any of its securities. Except as disclosed on Schedule 4.3, neither the offer, issuance or sale of any of the Note or the Warrant, or the issuance of any of
the Note Shares or Warrant Shares, nor the consummation of any transaction contemplated hereby will result in a change in the price or number of any securities of the Company outstanding, under anti-dilution or other similar provisions contained in
or affecting any such securities. 
  
 (c) All
issued and outstanding shares of the Company’s Common Stock: (i) have been duly authorized and validly issued and are fully paid and nonassessable; and (ii) were issued in compliance with all applicable state and federal laws concerning the
issuance of securities. 
  
 (d) The rights,
preferences, privileges and restrictions of the shares of the Common Stock are as stated in the Company’s Articles of Incorporation (the “Charter”). The Note Shares and Warrant Shares have been duly and validly reserved for issuance.
When issued in compliance with the provisions of this Agreement and the Company’s Charter, the Securities will be validly issued, fully paid and nonassessable, and will be free of any liens or encumbrances; provided, however, that the
Securities may be subject to restrictions on transfer under state and/or federal securities laws as set forth herein or as otherwise required by such laws at the time a transfer is proposed. 
  
 4.4 Authorization; Binding Obligations. All corporate, partnership or
limited liability company, as the case may be, action on the part of the Company and each of its Subsidiaries (including the respective officers and directors) necessary for the authorization of this Agreement and the Related Agreements, the
performance of all obligations of the Company and its Subsidiaries hereunder and under the other Related Agreements at the Closing and, the authorization, sale, issuance and delivery of the Note and Warrant has been taken or will be taken prior to
the Closing. This Agreement and the Related Agreements, when executed and delivered and to the extent it is a party thereto, will be valid and binding obligations of each of the Company and each of its Subsidiaries, enforceable against each such
person in accordance with their terms, except: 
  
 (a) as limited by applicable bankruptcy, insolvency, reorganization, moratorium or other laws of general application affecting enforcement of creditors’ rights; and 
  

 4 

 (b) general principles of equity that restrict the availability of equitable or legal
remedies. 
  
 The sale of the Note and the subsequent conversion of the Note into
Note Shares are not and will not be subject to any preemptive rights or rights of first refusal that have not been properly waived or complied with. The issuance of the Warrant and the subsequent exercise of the Warrant for Warrant Shares are not
and will not be subject to any preemptive rights or rights of first refusal that have not been properly waived or complied with. 
  
 4.5 Liabilities. Neither the Company nor any of its Subsidiaries has any material contingent liabilities, except current liabilities incurred in
the ordinary course of business and liabilities disclosed in any Exchange Act Filings. 
  
 4.6 Agreements; Action. Except as set forth on Schedule 4.6 or as disclosed in any Exchange Act Filings: 
  
 (a) there are no agreements, understandings, instruments, contracts, proposed transactions, judgments, orders, writs or decrees to which
the Company or any of its Subsidiaries is a party or by which it is bound which may involve: (i) obligations (contingent or otherwise) of, or payments to, the Company in excess of $50,000 (other than obligations of, or payments to, the Company
arising from purchase or sale agreements entered into in the ordinary course of business); or (ii) the transfer or license of any material patent, copyright, trade secret or other proprietary right to or from the Company (other than licenses arising
from the purchase of “off the shelf” or other standard products); or (iii) provisions restricting the development, manufacture or distribution of the Company’s products or services; or (iv) indemnification by the Company with respect
to infringements of proprietary rights. 
  
 (b)
Since March 31, 2004, neither the Company nor any of its Subsidiaries has: (i) declared or paid any dividends, or authorized or made any distribution upon or with respect to any class or series of its capital stock; (ii) incurred any indebtedness
for money borrowed or any other liabilities (other than ordinary course obligations) individually in excess of $50,000 or, in the case of indebtedness and/or liabilities individually less than $50,000, in excess of $100,000 in the aggregate; (iii)
made any loans or advances to any person not in excess, individually or in the aggregate, of $100,000, other than ordinary course advances for travel expenses; or (iv) sold, exchanged or otherwise disposed of any material portion of its assets or
rights, other than the sale of its inventory in the ordinary course of business. 
  
 (c) For the purposes of subsections (a) and (b) above, all indebtedness, liabilities, agreements, understandings, instruments, contracts
and proposed transactions involving the same person or entity (including persons or entities the Company has reason to believe are affiliated therewith) shall be aggregated for the purpose of meeting the individual minimum dollar amounts of such
subsections. 
  

 5 

 4.7 Obligations to Related Parties. Except as set forth on Schedule 4.7, there are no obligations
of the Company or any of its Subsidiaries to officers, directors, stockholders or employees of the Company or any of its Subsidiaries other than: 
  
 (a) for payment of salary for services rendered and for bonus payments; 
  
 (b) reimbursement for reasonable expenses incurred on behalf of the Company and its Subsidiaries;

  
 (c) for other standard employee benefits made
generally available to all employees (including stock option agreements outstanding under any stock option plan approved by the Board of Directors of the Company); and 
  
 (d) obligations listed in the Company’s financial statements or disclosed in any of its Exchange Act
Filings. 
  
 Except as described above or set forth on Schedule 4.7, none of the
officers, directors or, to the best of the Company’s knowledge, key employees or stockholders of the Company or any members of their immediate families, are indebted to the Company, individually or in the aggregate, in excess of $50,000 or have
any direct or indirect ownership interest in any firm or corporation with which the Company is affiliated or with which the Company has a business relationship, or any firm or corporation which competes with the Company, other than passive
investments in publicly traded companies (representing less than one percent (1%) of such company) which may compete with the Company. Except as described above, no officer, director or stockholder, or any member of their immediate families, is,
directly or indirectly, interested in any material contract with the Company and no agreements, understandings or proposed transactions are contemplated between the Company and any such person. Except as set forth on Schedule 4.7, the Company is not
a guarantor or indemnitor of any indebtedness of any other person, firm or corporation. 
  
 4.8 Changes. Since March 31, 2004, except as disclosed in any Exchange Act Filing or in any Schedule to this Agreement or to any of the Related Agreements, there has not been: 
  
 (a) any change in the business, assets, liabilities,
condition (financial or otherwise), properties, operations or prospects of the Company or any of its Subsidiaries, which individually or in the aggregate has had, or could reasonably be expected to have, individually or in the aggregate, a Material
Adverse Effect; 
  
 (b) any resignation or
termination of any officer, key employee or group of employees of the Company or any of its Subsidiaries; 
  
 (c) any material change, except in the ordinary course of business, in the contingent obligations of the Company or any of its
Subsidiaries by way of guaranty, endorsement, indemnity, warranty or otherwise; 
  

 6 

 (d) any damage, destruction or loss, whether or not covered by insurance, has had, or
could reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect; 
  
 (e) any waiver by the Company or any of its Subsidiaries of a valuable right or of a material debt owed to it; 
  
 (f) any direct or indirect loans made by the Company or any
of its Subsidiaries to any stockholder, employee, officer or director of the Company or any of its Subsidiaries, other than advances made in the ordinary course of business; 
  
 (g) any material change in any compensation arrangement or agreement with any employee, officer, director or
stockholder of the Company or any of its Subsidiaries; 
  
 (h) any declaration or payment of any dividend or other distribution of the assets of the Company or any of its Subsidiaries; 
  
 (i) any labor organization activity related to the Company or any of its Subsidiaries; 
  
 (j) any debt, obligation or liability incurred, assumed or
guaranteed by the Company or any of its Subsidiaries, except those for immaterial amounts and for current liabilities incurred in the ordinary course of business; 
  
 (k) any sale, assignment or transfer of any material patents, trademarks, copyrights, trade secrets or other
intangible assets owned by the Company or any of its Subsidiaries; 
  
 (l) any change in any material agreement to which the Company or any of its Subsidiaries is a party or by which either the Company or any of its Subsidiaries is bound which either individually or in the aggregate has
had, or could reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect; 
  
 (m) any other event or condition of any character that, either individually or in the aggregate, has had, or could reasonably be expected
to have, individually or in the aggregate, a Material Adverse Effect; or 
  
 (n) any arrangement or commitment by the Company or any of its Subsidiaries to do any of the acts described in subsection (a) through (m) above. 
  
 4.9 Title to Properties and Assets; Liens, Etc. Except as set forth on Schedule 4.9, each of the Company and each of
its Subsidiaries has good and marketable title to its properties and assets, and good title to its leasehold estates, in each case subject to no mortgage, pledge, lien, lease, encumbrance or charge, other than: 
  
 (a) those resulting from taxes which have not yet become
delinquent; 
  

 7 

 (b) minor liens and encumbrances which do not materially detract from the value of the
property subject thereto or materially impair the operations of the Company or any of its Subsidiaries; and 
  
 (c) those that have otherwise arisen in the ordinary course of business. 
  
 All facilities, machinery, equipment, fixtures, vehicles and other properties owned, leased or used by the Company and its Subsidiaries are
in good operating condition and repair and are reasonably fit and usable for the purposes for which they are being used. Except as set forth on Schedule 4.9, the Company and its Subsidiaries are in compliance in all material respects with all
material terms of each lease to which it is a party or is otherwise bound. 
  
 4.10 Intellectual Property. 
  
 (a) Each of the Company and each of its Subsidiaries owns or possesses sufficient legal rights to all patents, trademarks, service marks, trade names, copyrights, trade secrets, licenses, information and other
proprietary rights and processes necessary for its business as now conducted and to the Company’s knowledge, as presently proposed to be conducted (the “Intellectual Property”), without any known infringement of the rights of others.
There are no outstanding options, licenses or agreements of any kind relating to the foregoing proprietary rights, nor is the Company or any of its Subsidiaries bound by or a party to any options, licenses or agreements of any kind with respect to
the patents, trademarks, service marks, trade names, copyrights, trade secrets, licenses, information and other proprietary rights and processes of any other person or entity other than such licenses or agreements arising from the purchase of
“off the shelf” or standard products. 
  
 (b) Neither the Company nor any of its Subsidiaries has received any communications alleging that the Company or any of its Subsidiaries has violated any of the patents, trademarks, service marks, trade names, copyrights or trade secrets or
other proprietary rights of any other person or entity, nor is the Company or any of its Subsidiaries aware of any basis therefor. 
  
 (c) The Company does not believe it is or will be necessary to utilize any inventions, trade secrets or proprietary information of any of
its employees made prior to their employment by the Company or any of its Subsidiaries, except for inventions, trade secrets or proprietary information that have been rightfully assigned to the Company or any of its Subsidiaries. 
  
 4.11 Compliance with Other Instruments. Neither the Company nor any of
its Subsidiaries is in violation or default of (x) any term of its Charter or Bylaws, or (y) of any provision of any indebtedness, mortgage, indenture, contract, agreement or instrument to which it is party or by which it is bound or of any
judgment, decree, order or writ, which violation or default, in the case of this clause (y), has had, or could reasonably be expected to have, either individually or in the aggregate, a Material Adverse Effect. The execution, delivery and
performance of and compliance with this Agreement and the Related Agreements to which it is a party, and the issuance and sale of the Note by the Company and the other Securities by the 
  

 8 

 Company each pursuant hereto and thereto, will not, with or without the passage of time or giving of notice, result in
any such material violation, or be in conflict with or constitute a default under any such term or provision, or result in the creation of any mortgage, pledge, lien, encumbrance or charge upon any of the properties or assets of the Company or any
of its Subsidiaries or the suspension, revocation, impairment, forfeiture or nonrenewal of any permit, license, authorization or approval applicable to the Company, its business or operations or any of its assets or properties. 
  
 4.12 Litigation. Except as set forth on Schedule 4.12 hereto, there is
no action, suit, proceeding or investigation pending or, to the Company’s knowledge, currently threatened against the Company or any of its Subsidiaries that prevents the Company or any of its Subsidiaries from entering into this Agreement or
the other Related Agreements, or from consummating the transactions contemplated hereby or thereby, or which has had, or could reasonably be expected to have, either individually or in the aggregate, a Material Adverse Effect or any change in the
current equity ownership of the Company or any of its Subsidiaries, nor is the Company aware that there is any basis to assert any of the foregoing. Neither the Company nor any of its Subsidiaries is a party or subject to the provisions of any
order, writ, injunction, judgment or decree of any court or government agency or instrumentality. There is no action, suit, proceeding or investigation by the Company or any of its Subsidiaries currently pending or which the Company or any of its
Subsidiaries intends to initiate. 
  
 4.13 Tax Returns and
Payments. Each of the Company and each of its Subsidiaries has timely filed all tax returns (federal, state and local) required to be filed by it. All taxes shown to be due and payable on such returns, any assessments imposed, and all other
taxes due and payable by the Company or any of its Subsidiaries on or before the Closing, have been paid or will be paid prior to the time they become delinquent. Except as set forth on Schedule 4.13, neither the Company nor any of its Subsidiaries
has been advised: 
  
 (a) that any of its
returns, federal, state or other, have been or are being audited as of the date hereof; or 
  
 (b) of any deficiency in assessment or proposed judgment to its federal, state or other taxes. 
  
 The Company has no knowledge of any liability of any tax to be imposed upon its properties or
assets as of the date of this Agreement that is not adequately provided for. 
  
 4.14 Employees. Except as set forth on Schedule 4.14, neither the Company nor any of its Subsidiaries has any collective bargaining agreements with any of its employees. There is no labor union organizing
activity pending or, to the Company’s knowledge, threatened with respect to the Company or any of its Subsidiaries. Except as disclosed in the Exchange Act Filings or on Schedule 4.14, neither the Company nor any of its Subsidiaries is a party
to or bound by any currently effective employment contract, deferred compensation arrangement, bonus plan, incentive plan, profit sharing plan, retirement agreement or other employee compensation plan or agreement. To the Company’s knowledge,
no employee of the Company or any of its Subsidiaries, nor any consultant with whom the Company or any of its Subsidiaries has contracted, is in violation of any term of any employment contract, proprietary information 
  

 9 

 agreement or any other agreement relating to the right of any such individual to be employed by, or to contract with, the
Company or any of its Subsidiaries because of the nature of the business to be conducted by the Company or any of its Subsidiaries; and to the Company’s knowledge the continued employment by the Company or any of its Subsidiaries of its present
employees, and the performance of the Company’s and its Subsidiaries’ contracts with its independent contractors, will not result in any such violation. Neither the Company nor any of its Subsidiaries is aware that any of its employees is
obligated under any contract (including licenses, covenants or commitments of any nature) or other agreement, or subject to any judgment, decree or order of any court or administrative agency, that would interfere with their duties to the Company or
any of its Subsidiaries. Neither the Company nor any of its Subsidiaries has received any notice alleging that any such violation has occurred. Except for employees who have a current effective employment agreement with the Company or any of its
Subsidiaries, no employee of the Company or any of its Subsidiaries has been granted the right to continued employment by the Company or any of its Subsidiaries or to any material compensation following termination of employment with the Company or
any of its Subsidiaries. Except as set forth on Schedule 4.14, the Company is not aware that any officer, key employee or group of employees intends to terminate his, her or their employment with the Company or any of its Subsidiaries, nor does the
Company or any of its Subsidiaries have a present intention to terminate the employment of any officer, key employee or group of employees. 
  
 4.15 Registration Rights and Voting Rights. Except as set forth on Schedule 4.15 and except as disclosed in Exchange Act Filings, neither the
Company nor any of its Subsidiaries is presently under any obligation, and neither the Company nor any of its Subsidiaries has granted any rights, to register any of the Company’s or its Subsidiaries’ presently outstanding securities or
any of its securities that may hereafter be issued. Except as set forth on Schedule 4.15 and except as disclosed in Exchange Act Filings, to the Company’s knowledge, no stockholder of the Company or any of its Subsidiaries has entered into any
agreement with respect to the voting of equity securities of the Company or any of its Subsidiaries. 
  
 4.16 Compliance with Laws; Permits. Neither the Company nor any of its Subsidiaries is in violation of any applicable statute, rule, regulation,
order or restriction of any domestic or foreign government or any instrumentality or agency thereof in respect of the conduct of its business or the ownership of its properties which has had, or could reasonably be expected to have, either
individually or in the aggregate, a Material Adverse Effect. No governmental orders, permissions, consents, approvals or authorizations are required to be obtained and no registrations or declarations are required to be filed in connection with the
execution and delivery of this Agreement or any other Related Agreement and the issuance of any of the Securities, except such as has been duly and validly obtained or filed, or with respect to any filings that must be made after the Closing, as
will be filed in a timely manner. Each of the Company and its Subsidiaries has all material franchises, permits, licenses and any similar authority necessary for the conduct of its business as now being conducted by it, the lack of which could,
either individually or in the aggregate, reasonably be expected to have a Material Adverse Effect. 
  
 4.17 Environmental and Safety Laws. Neither the Company nor any of its Subsidiaries is in violation of any applicable statute, law or regulation
relating to the 
  

 10 

 environment or occupational health and safety, and to its knowledge, no material expenditures are or will be required in
order to comply with any such existing statute, law or regulation. Except as set forth on Schedule 4.17, no Hazardous Materials (as defined below) are used or have been used, stored, or disposed of by the Company or any of its Subsidiaries or, to
the Company’s knowledge, by any other person or entity on any property owned, leased or used by the Company or any of its Subsidiaries. For the purposes of the preceding sentence, “Hazardous Materials” shall mean: 
  
 (a) materials which are listed or otherwise defined as
“hazardous” or “toxic” under any applicable local, state, federal and/or foreign laws and regulations that govern the existence and/or remedy of contamination on property, the protection of the environment from contamination, the
control of hazardous wastes, or other activities involving hazardous substances, including building materials; or 
  
 (b) any petroleum products or nuclear materials. 
  

4.18 Valid Offering. Assuming the accuracy of the representations and warranties of the Purchaser contained in this Agreement, the offer, sale
and issuance of the Securities will be exempt from the registration requirements of the Securities Act of 1933, as amended (the “Securities Act”), and will have been registered or qualified (or are exempt from registration and
qualification) under the registration, permit or qualification requirements of all applicable state securities laws. 
  
 4.19 Full Disclosure. Each of the Company and each of its Subsidiaries has provided the Purchaser with all information requested by the Purchaser
in connection with its decision to purchase the Note and Warrant, including all information the Company and its Subsidiaries believe is reasonably necessary to make such investment decision. Neither this Agreement, the Related Agreements, the
exhibits and schedules hereto and thereto nor any other document delivered by the Company or any of its Subsidiaries to Purchaser or its attorneys or agents in connection herewith or therewith or with the transactions contemplated hereby or thereby,
contain any untrue statement of a material fact nor omit to state a material fact necessary in order to make the statements contained herein or therein, in light of the circumstances in which they are made, not misleading. Any financial projections
and other estimates provided to the Purchaser by the Company or any of its Subsidiaries were based on the Company’s and its Subsidiaries’ experience in the industry and on assumptions of fact and opinion as to future events which the
Company or any of its Subsidiaries, at the date of the issuance of such projections or estimates, believed to be reasonable. 
  
 4.20 Insurance. Each of the Company and each of its Subsidiaries has general commercial, product liability, fire and casualty insurance policies
with coverages which the Company believes are customary for companies similarly situated to the Company and its Subsidiaries in the same or similar business. 
  
 4.21 SEC Reports. Except as set forth on Schedule 4.21, the Company has filed all proxy statements, reports and other documents required to be
filed by it under the Securities Exchange Act 1934, as amended (the “Exchange Act”). The Company has furnished the Purchaser with copies of: (i) its Annual Reports on Form 10-KSB for its fiscal year ended 
  

 11 

 March 31, 2004; and (ii) its Quarterly Reports on Form 10-QSB for its fiscal quarter ended [June 30], 2004, and the Form
8-K filings which it has made during the fiscal year 2005 to date (collectively, the “SEC Reports”). Except as set forth on Schedule 4.21, each SEC Report was, at the time of its filing, in substantial compliance with the requirements of
its respective form and none of the SEC Reports, nor the financial statements (and the notes thereto) included in the SEC Reports, as of their respective filing dates, contained any untrue statement of a material fact or omitted to state a material
fact required to be stated therein or necessary to make the statements therein, in light of the circumstances under which they were made, not misleading. 
  
 4.22 Listing. The Company’s Common Stock is traded on the National Association of Securities Dealers Over the Counter Bulletin Board
(“NASD OTCBB”)and the Company has satisfied all requirements for the continuation of such trading. The Company has not received any notice that its Common Stock will not be eligible to be traded on the NASD OTCBB or that its Common Stock
does not meet all requirements for such trading. 
  
 4.23 No
Integrated Offering. Neither the Company, nor any of its Subsidiaries or 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 the offering of the Securities pursuant to this Agreement or any of the Related Agreements to be integrated with prior offerings by the Company for purposes of the Securities Act which would prevent the Company
from selling the Securities pursuant to Rule 506 under the Securities Act, or any applicable exchange-related stockholder approval provisions, nor will the Company or any of its affiliates or Subsidiaries take any action or steps that would cause
the offering of the Securities to be integrated with other offerings. 
  
 4.24 Stop Transfer. The Securities are restricted securities as of the date of this Agreement. Neither the Company nor any of its Subsidiaries will issue any stop transfer order or other order impeding the sale and delivery of any of
the Securities at such time as the Securities are registered for public sale under a currently effective registration statement or an exemption from registration is available, except as required by state and federal securities laws. 
  
 4.25 Dilution. The Company specifically acknowledges that its
obligation to issue the shares of Common Stock upon conversion of the Note and exercise of the Warrant is binding upon the Company and enforceable regardless of the dilution such issuance may have on the ownership interests of other shareholders of
the Company. 
  
 4.26 Patriot Act. The Company certifies
that, to the best of Company’s knowledge, neither the Company nor any of its Subsidiaries has been designated, and is not owned or controlled, by a “suspected terrorist” as defined in Executive Order 13224. The Company hereby
acknowledges that the Purchaser seeks to comply with all applicable laws concerning money laundering and related activities. In furtherance of those efforts, the Company hereby represents, warrants and agrees that: (i) none of the cash or property
that the Company or any of its Subsidiaries will pay or will contribute to the Purchaser has been or shall be derived from, or related to, any activity that is deemed criminal under United States law; and (ii) no contribution or payment by the
Company or any of its Subsidiaries to the Purchaser, to the extent that they are within the Company’s and/or its Subsidiaries’ control shall cause the Purchaser to be in violation of the United States Bank Secrecy Act, the United States

  

 12 

 International Money Laundering Control Act of 1986 or the United States International Money Laundering Abatement and
Anti-Terrorist Financing Act of 2001. The Company shall promptly notify the Purchaser if any of these representations ceases to be true and accurate regarding the Company or any of its Subsidiaries. The Company agrees to provide the Purchaser any
additional information regarding the Company or any of its Subsidiaries that the Purchaser deems necessary or convenient to ensure compliance with all applicable laws concerning money laundering and similar activities. The Company understands and
agrees that if at any time it is discovered that any of the foregoing representations are incorrect, or if otherwise required by applicable law or regulation related to money laundering similar activities, the Purchaser may undertake appropriate
actions to ensure compliance with applicable law or regulation, including but not limited to segregation and/or redemption of the Purchaser’s investment in the Company. The Company further understands that the Purchaser may release confidential
information about the Company and its Subsidiaries and, if applicable, any underlying beneficial owners, to proper authorities if the Purchaser, in its sole discretion, determines that it is in the best interests of the Purchaser in light of
relevant rules and regulations under the laws set forth in subsection (ii) above. 
  
 5. Representations and Warranties of the Purchaser. The Purchaser hereby represents and warrants to the Company as follows (such representations and warranties do not lessen or obviate the representations and
warranties of the Company set forth in this Agreement): 
  
 5.1
No Shorting. The Purchaser or any of its affiliates and investment partners has not, will not and will not cause any person or entity, to directly engage in “short sales” of the Company’s Common Stock as long as the Note shall
be outstanding. 
  
 5.2 Requisite Power and Authority. The
Purchaser has all necessary power and authority under all applicable provisions of law to execute and deliver this Agreement and the Related Agreements and to carry out their provisions. All corporate action on Purchaser’s part required for the
lawful execution and delivery of this Agreement and the Related Agreements have been or will be effectively taken prior to the Closing. Upon their execution and delivery, this Agreement and the Related Agreements will be valid and binding
obligations of Purchaser, enforceable in accordance with their terms, except: 
  
 (a) as limited by applicable bankruptcy, insolvency, reorganization, moratorium or other laws of general application affecting enforcement of creditors’ rights; and 
  
 (b) as limited by general principles of equity that restrict
the availability of equitable and legal remedies. 
  
 5.3
Investment Representations. Purchaser understands that the Securities are being offered and sold pursuant to an exemption from registration contained in the Securities Act based in part upon Purchaser’s representations contained in the
Agreement, including, without limitation, that the Purchaser is an “accredited investor” within the meaning of Regulation D under the Securities Act of 1933, as amended (the “Securities Act”). The Purchaser confirms that it has
received or has had full access to all the information it considers necessary or appropriate to make an informed investment decision with respect to the Note and the Warrant to be purchased by it under this Agreement and the Note Shares and the
Warrant Shares acquired by it 
  

 13 

 upon the conversion of the Note and the exercise of the Warrant, respectively. The Purchaser further confirms that it has
had an opportunity to ask questions and receive answers from the Company regarding the Company’s and its Subsidiaries’ business, management and financial affairs and the terms and conditions of the Offering, the Note, the Warrant and the
Securities and to obtain additional information (to the extent the Company possessed such information or could acquire it without unreasonable effort or expense) necessary to verify any information furnished to the Purchaser or to which the
Purchaser had access. 
  
 5.4 Purchaser Bears Economic
Risk. The Purchaser has substantial experience in evaluating and investing in private placement transactions of securities in companies similar to the Company so that it is capable of evaluating the merits and risks of its investment in the
Company and has the capacity to protect its own interests. The Purchaser must bear the economic risk of this investment until the Securities are sold pursuant to: (i) an effective registration statement under the Securities Act; or (ii) an exemption
from registration is available with respect to such sale. 
  
 5.5
Acquisition for Own Account. The Purchaser is acquiring the Note and Warrant and the Note Shares and the Warrant Shares for the Purchaser’s own account for investment only, and not as a nominee or agent and not with a view towards or for
resale in connection with their distribution. 
  
 5.6 Purchaser
Can Protect Its Interest. The Purchaser represents that by reason of its, or of its management’s, business and financial experience, the Purchaser has the capacity to evaluate the merits and risks of its investment in the Note, the Warrant
and the Securities and to protect its own interests in connection with the transactions contemplated in this Agreement and the Related Agreements. Further, Purchaser is aware of no publication of any advertisement in connection with the transactions
contemplated in the Agreement or the Related Agreements. 
  
 5.7
Accredited Investor. Purchaser represents that it is an accredited investor within the meaning of Regulation D under the Securities Act. 
  
 5.8 Legends. 
  
 (a) The Note shall bear substantially the following legend: 
  
 “THIS NOTE AND THE COMMON STOCK ISSUABLE UPON CONVERSION OF THIS NOTE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT
OF 1933, AS AMENDED, OR ANY APPLICABLE, STATE SECURITIES LAWS. THIS NOTE AND THE COMMON STOCK ISSUABLE UPON CONVERSION OF THIS NOTE MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED OR HYPOTHECATED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT AS
TO THIS NOTE OR SUCH SHARES UNDER SAID ACT AND APPLICABLE STATE SECURITIES LAWS OR AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO DYNAMIC HEALTH SOLUTIONS, INC. THAT SUCH REGISTRATION IS NOT REQUIRED.” 
  

 14 

 (b) The Note Shares and the Warrant Shares, if not issued by DWAC system (as hereinafter
defined), shall bear a legend which shall be in substantially the following form until such shares are covered by an effective registration statement filed with the SEC: 
  
 “THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR
ANY APPLICABLE STATE SECURITIES LAWS. THESE SHARES MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED OR HYPOTHECATED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT UNDER SUCH SECURITIES ACT AND APPLICABLE STATE LAWS OR AN OPINION OF COUNSEL
REASONABLY SATISFACTORY TO DYNAMIC HEALTH SOLUTIONS, INC. THAT SUCH REGISTRATION IS NOT REQUIRED.” 
  
 (c) The Warrant shall bear substantially the following legend: 
  
 “THIS WARRANT AND THE COMMON SHARES ISSUABLE UPON EXERCISE OF THIS WARRANT HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED, OR ANY APPLICABLE STATE SECURITIES LAWS. THIS WARRANT AND THE COMMON SHARES ISSUABLE UPON EXERCISE OF THIS WARRANT MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED OR HYPOTHECATED IN THE ABSENCE OF AN EFFECTIVE
REGISTRATION STATEMENT AS TO THIS WARRANT OR THE UNDERLYING SHARES OF COMMON STOCK UNDER SAID ACT AND APPLICABLE STATE SECURITIES LAWS OR AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO DYNAMIC HEALTH SOLUTIONS, INC. THAT SUCH REGISTRATION IS NOT
REQUIRED.” 
  
 6. Covenants of the Company. The
Company covenants and agrees with the Purchaser as follows: 
  
 6.1 Stop-Orders. The Company will advise the Purchaser, promptly after it receives notice of issuance by the Securities and Exchange Commission (the “SEC”), any state securities commission or any other regulatory authority
of any stop order or of any order preventing or suspending any offering of any securities of the Company, or of the suspension of the qualification of the Common Stock of the Company for offering or sale in any jurisdiction, or the initiation of any
proceeding for any such purpose. 
  
 6.2 Listing. The
Company shall cause the shares of Common Stock issuable upon conversion of the Note and upon the exercise of the Warrant to be eligible for trading on 
  

 15 

 the NASD OTCBB (the “Principal Market”) and shall maintain such eligibility so long as any other shares of
Common Stock shall be quoted on such Principal Market. The Company will maintain the quotation of its Common Stock on the Principal Market (or such other market acceptable to the Purchaser), and will comply in all material respects with the
Company’s reporting, filing and other obligations under the bylaws or rules of the National Association of Securities Dealers (“NASD”) and such exchanges, as applicable.Market Regulations. The Company shall notify the SEC, NASD
and applicable state authorities, in accordance with their requirements, of the transactions contemplated by this Agreement, and shall take all other necessary action and proceedings as may be required and permitted by applicable law, rule and
regulation, for the legal and valid issuance of the Securities to the Purchaser and promptly provide copies thereof to the Purchaser. 
  
 6.4 Reporting Requirements. The Company will timely file with the SEC all reports required to be filed pursuant to the Exchange Act and refrain
from terminating its status as an issuer required by the Exchange Act to file reports thereunder even if the Exchange Act or the rules or regulations thereunder would permit such termination. 
  
 6.5 Use of Funds. The Company agrees that it will use (x) up to
$5,000,000 of the proceeds of the sale of the Note to consummate the Company’s acquisition of Bob O’Leary Health Food Distributor Co., Inc., a Pennsylvania corporation, pursuant to a Stock Purchase Agreement in form and substance
satisfactory to the Purchaser and (y) the remainder of the proceeds of the Note and the proceeds of the Warrant for general working capital purposes. 
  
 6.6 Access to Facilities. Each of the Company and each of its Subsidiaries will permit any representatives designated by the Purchaser (or any
successor of the Purchaser), upon reasonable notice and during normal business hours, at such person’s expense and accompanied by a representative of the Company, to: 
  
 (a) visit and inspect any of the properties of the Company or any of its Subsidiaries; 
  
 (b) examine the corporate and financial records of the
Company or any of its Subsidiaries (unless such examination is not permitted by federal, state or local law or by contract) and make copies thereof or extracts therefrom; and 
  
 (c) discuss the affairs, finances and accounts of the Company or any of its Subsidiaries with the directors,
officers and independent accountants of the Company or any of its Subsidiaries. 
  
 Notwithstanding the foregoing, neither the Company nor any of its Subsidiaries will provide any material, non-public information to the Purchaser unless the Purchaser signs a confidentiality agreement and otherwise complies with Regulation
FD, under the federal securities laws. 
  
 6.7 Taxes. Each
of the Company and each of its Subsidiaries will promptly pay and discharge, or cause to be paid and discharged, when due and payable, all lawful taxes, assessments and governmental charges or levies imposed upon the income, profits, property or
business of the Company and its Subsidiaries; provided, however, that any such tax, assessment, charge or levy need not be paid if the validity thereof shall currently be contested in good faith 
  

 16 

 by appropriate proceedings and if the Company and/or such Subsidiary shall have set aside on its books adequate reserves
with respect thereto, and provided, further, that the Company and its Subsidiaries will pay all such taxes, assessments, charges or levies forthwith upon the commencement of proceedings to foreclose any lien which may have attached as security
therefor. 
  
 6.8 Insurance. Each of the Company and its
Subsidiaries will keep its assets which are of an insurable character insured by financially sound and reputable insurers against loss or damage by fire, explosion and other risks customarily insured against by companies in similar business
similarly situated as the Company and its Subsidiaries; and the Company and its Subsidiaries will maintain, with financially sound and reputable insurers, insurance against other hazards and risks and liability to persons and property to the extent
and in the manner which the Company reasonably believes is customary for companies in similar business similarly situated as the Company and its Subsidiaries and to the extent available on commercially reasonable terms. The Company, and each of its
Subsidiaries will jointly and severally bear the full risk of loss from any loss of any nature whatsoever with respect to the assets pledged to the Purchaser as security for its obligations hereunder and under the Related Agreements. At the
Company’s and each of its Subsidiaries’ joint and several cost and expense in amounts and with carriers reasonably acceptable to Purchaser, the Company and each of its Subsidiaries shall (i) keep all its insurable properties and properties
in which it has an interest insured against the hazards of fire, flood, sprinkler leakage, those hazards covered by extended coverage insurance and such other hazards, and for such amounts, as is customary in the case of companies engaged in
businesses similar to the Company’s or the respective Subsidiary’s including business interruption insurance; (ii) maintain a bond in such amounts as is customary in the case of companies engaged in businesses similar to the Company’s
or the respective Subsidiary’s insuring against larceny, embezzlement or other criminal misappropriation of insured’s officers and employees who may either singly or jointly with others at any time have access to the assets or funds of the
Company or any of its Subsidiaries either directly or through governmental authority to draw upon such funds or to direct generally the disposition of such assets; (iii) maintain public and product liability insurance against claims for personal
injury, death or property damage suffered by others; (iv) maintain all such worker’s compensation or similar insurance as may be required under the laws of any state or jurisdiction in which the Company or the respective Subsidiary is engaged
in business; and (v) furnish Purchaser with (x) copies of all policies and evidence of the maintenance of such policies at least thirty (30) days before any expiration date, (y) excepting the Company’s workers’ compensation policy,
endorsements to such policies naming Purchaser as “co-insured” or “additional insured” and appropriate loss payable endorsements in form and substance satisfactory to Purchaser, naming Purchaser as loss payee, and (z) evidence
that as to Purchaser the insurance coverage shall not be impaired or invalidated by any act or neglect of the Company or any Subsidiary and the insurer will provide Purchaser with at least thirty (30) days notice prior to cancellation. The Company
and each Subsidiary shall instruct the insurance carriers that in the event of any loss thereunder, the carriers shall make payment for such loss to the Company and/or the Subsidiary and Purchaser jointly. In the event that as of the date of receipt
of each loss recovery upon any such insurance, the Purchaser has not declared an event of default with respect to this Agreement or any of the Related Agreements, then the Company and/or such Subsidiary shall be permitted to direct the application
of such loss recovery proceeds toward investment in property, plant and equipment that would comprise “Collateral” secured by Purchaser’s security interest pursuant to its security agreement, with any surplus funds to be 

 

 17 

 applied toward payment of the obligations of the Company to Purchaser. In the event that Purchaser has properly declared
an event of default with respect to this Agreement or any of the Related Agreements, then all loss recoveries received by Purchaser upon any such insurance thereafter may be applied to the obligations of the Company hereunder and under the Related
Agreements, in such order as the Purchaser may determine. Any surplus (following satisfaction of all Company obligations to Purchaser) shall be paid by Purchaser to the Company or applied as may be otherwise required by law. Any deficiency thereon
shall be paid by the Company or the Subsidiary, as applicable, to Purchaser, on demand. 
  
 6.9 Intellectual Property. Each of the Company and each of its Subsidiaries shall maintain in full force and effect its existence, rights and franchises and all licenses and other rights to use Intellectual
Property owned or possessed by it and reasonably deemed to be necessary to the conduct of its business. 
  
 6.10 Properties. Each of the Company and each of its Subsidiaries will keep its properties in good repair, working order and condition, reasonable
wear and tear excepted, and from time to time make all needful and proper repairs, renewals, replacements, additions and improvements thereto; and each of the Company and each of its Subsidiaries will at all times comply with each provision of all
leases to which it is a party or under which it occupies property if the breach of such provision could, either individually or in the aggregate, reasonably be expected to have a Material Adverse Effect. 
  
 6.11 Confidentiality. The Company agrees that it will not disclose,
and will not include in any public announcement, the name of the Purchaser, unless expressly agreed to by the Purchaser or unless and until such disclosure is required by law or applicable regulation, and then only to the extent of such requirement.
Notwithstanding the foregoing, the Company may disclose Purchaser’s identity and the terms of this Agreement to its current and prospective debt and equity financing sources. 
  
 6.12 Required Approvals. For so long as twenty-five percent (25%) of the principal amount of the Note is outstanding,
the Company, without the prior written consent of the Purchaser, shall not, and shall not permit any of its Subsidiaries to: 
  
 (a) (i) directly or indirectly declare or pay any dividends, other than dividends paid to the Parent or any of its wholly-owned
Subsidiaries, (ii) issue any preferred stock that is mandatorily redeemable prior to the one year anniversary of the Maturity Date (as defined in the Note) or (iii) redeem any of its preferred stock or other equity interests; 
  
 (b) liquidate, dissolve or effect a material reorganization
(it being understood that in no event shall the Company dissolve, liquidate or merge with any other person or entity (unless the Company is the surviving entity); 
  
 (c) become subject to (including, without limitation, by way of amendment to or modification of) any
agreement or instrument which by its terms would (under any circumstances) restrict the Company’s or any of its Subsidiaries right to perform the provisions of this Agreement, any Related Agreement or any of the agreements contemplated hereby
or thereby; 
  

 18 

 (d) materially alter or change the scope of the business of the Company and its
Subsidiaries taken as a whole; 
  
 (e) (i)
create, incur, assume or suffer to exist any indebtedness (exclusive of trade debt and debt incurred to finance the purchase of equipment (not in excess of five percent (5%) of the fair market value of the Company’s and its Subsidiaries’
assets) whether secured or unsecured other than (x) the Company’s indebtedness to the Purchaser, (y) indebtedness set forth on Schedule 6.12(e) attached hereto and made a part hereof and any refinancings or replacements thereof on terms
no less favorable to the Purchaser than the indebtedness being refinanced or replaced, and (z) any debt incurred in connection with the purchase of assets in the ordinary course of business, or any refinancings or replacements thereof on terms no
less favorable to the Purchaser than the indebtedness being refinanced or replaced; (ii) cancel any debt owing to it in excess of $50,000 in the aggregate during any 12 month period; (iii) assume, guarantee, endorse or otherwise become directly or
contingently liable in connection with any obligations of any other Person, except the endorsement of negotiable instruments by the Company for deposit or collection or similar transactions in the ordinary course of business or guarantees of
indebtedness otherwise permitted to be outstanding pursuant to this clause (e); and 
  
 (f) create or acquire any Subsidiary after the date hereof unless (i) such Subsidiary is a wholly-owned Subsidiary of the Company and (ii)
such Subsidiary becomes party to the Master Security Agreement, the Stock Pledge Agreement and the Subsidiary Guaranty (either by executing a counterpart thereof or an assumption or joinder agreement in respect thereof) and, to the extent required
by the Purchaser, satisfies each condition of this Agreement and the Related Agreements as if such Subsidiary were a Subsidiary on the Closing Date. 
  
 6.13 Reissuance of Securities. The Company agrees to reissue certificates representing the Securities without the legends set forth in Section 5.8
above at such time as: 
  
 (a) the holder thereof
is permitted to dispose of such Securities pursuant to Rule 144(k) under the Securities Act; or 
  
 (b) upon resale subject to an effective registration statement after such Securities are registered under the Securities Act. 

 
 The Company agrees to cooperate with the Purchaser in connection with all resales pursuant
to Rule 144(d) and Rule 144(k) and provide legal opinions necessary to allow such resales provided the Company and its counsel receive reasonably requested representations from the selling Purchaser and broker, if any. 
  
 6.14 Opinion. On the Closing Date, the Company will deliver to the
Purchaser an opinion acceptable to the Purchaser from the Company’s external legal counsel. The Company will provide, at the Company’s expense, such other legal opinions in the future as are deemed reasonably necessary by the Purchaser
(and acceptable to the Purchaser) in connection with the conversion of the Note and exercise of the Warrant. 
  

 19 

 6.15 Margin Stock. The Company will not permit any of the proceeds of the Note or the Warrant to
be used directly or indirectly to “purchase” or “carry” “margin stock” or to repay indebtedness incurred to “purchase” or “carry” “margin stock” within the respective meanings of each of
the quoted terms under Regulation U of the Board of Governors of the Federal Reserve System as now and from time to time hereafter in effect. 
  
 6.16 Financing Right of First Refusal. (a) The Company hereby grants to the Purchaser a right of first refusal to provide any Additional Financing
(as defined below) to be issued by the Company and/or any of its Subsidiaries, subject to the following terms and conditions. From and after the date hereof, prior to the incurrence of any additional indebtedness and/or the sale or issuance of any
equity interests of the Company or any of its Subsidiaries (an “Additional Financing”), the Company and/or any Subsidiary of the Company, as the case may be, shall notify the Purchaser of its intention to enter into such Additional
Financing. In connection therewith, the Company and/or the applicable Subsidiary thereof shall submit a fully executed term sheet (a “Proposed Term Sheet”) to the Purchaser setting forth the terms, conditions and pricing of any such
Additional Financing (such financing to be negotiated on “arm’s length” terms and the terms thereof to be negotiated in good faith) proposed to be entered into by the Company and/or such Subsidiary. The Purchaser shall have the right,
but not the obligation, to deliver its own proposed term sheet (the “Purchaser Term Sheet”) setting forth the terms and conditions upon which Purchaser would be willing to provide such Additional Financing to the Company and/or such
Subsidiary. The Purchaser Term Sheet shall contain terms no less favorable to the Company and /or the Subsidiary than those outlined in Proposed Term Sheet. The Purchaser shall deliver such Purchaser Term Sheet within ten business days of receipt of
each such Proposed Term Sheet. If the provisions of the Purchaser Term Sheet are at least as favorable to the Company and/or such Subsidiary, as the case may be, as the provisions of the Proposed Term Sheet, the Company and/or such Subsidiary shall
enter into and consummate the Additional Financing transaction outlined in the Purchaser Term Sheet. 
  
 (b) The Company will not, and will not permit its Subsidiaries to, agree, directly or indirectly, to any restriction with any person or entity which
limits the ability of the Purchaser to consummate an Additional Financing with the Company or any of its Subsidiaries. 
  
 7. Covenants of the Purchaser. The Purchaser covenants and agrees with the Company as follows: 
  
 7.1 Confidentiality. The Purchaser agrees that it will not disclose,
and will not include in any public announcement, the name of the Company, unless expressly agreed to by the Company or unless and until such disclosure is required by law or applicable regulation, and then only to the extent of such requirement.

  
 7.2 Non-Public Information. The Purchaser agrees not to
effect any sales in the shares of the Company’s Common Stock while in possession of material, non-public information regarding the Company if such sales would violate applicable securities law. 
  

 20 

 8. Covenants of the Company and Purchaser Regarding Indemnification. 
  
 8.1 Company Indemnification. The Company agrees to indemnify, hold
harmless, reimburse and defend the Purchaser, each of the Purchaser’s officers, directors, agents, affiliates, control persons, and principal shareholders, against any claim, cost, expense, liability, obligation, loss or damage (including
reasonable legal fees) of any nature, incurred by or imposed upon the Purchaser which results, arises out of or is based upon: (i) any misrepresentation by the Company or any of its Subsidiaries or breach of any warranty by the Company or any of its
Subsidiaries in this Agreement, any other Related Agreement or in any exhibits or schedules attached hereto or thereto; or (ii) any breach or default in performance by Company or any of its Subsidiaries of any covenant or undertaking to be performed
by Company or any of its Subsidiaries hereunder, under any other Related Agreement or any other agreement entered into by the Company and/or any of its Subsidiaries and Purchaser relating hereto or thereto. 
  
 8.2 Purchaser’s Indemnification. Purchaser agrees to indemnify,
hold harmless, reimburse and defend the Company and each of the Company’s officers, directors, agents, affiliates, control persons and principal shareholders, at all times against any claim, cost, expense, liability, obligation, loss or damage
(including reasonable legal fees) of any nature, incurred by or imposed upon the Company which results, arises out of or is based upon: (i) any misrepresentation by Purchaser or breach of any warranty by Purchaser in this Agreement or in any
exhibits or schedules attached hereto or any Related Agreement; or (ii) any breach or default in performance by Purchaser of any covenant or undertaking to be performed by Purchaser hereunder, or any other agreement entered into by the Company and
Purchaser relating hereto. 
  
 9. Conversion of Convertible
Note. 
  
 9.1 Mechanics of Conversion. 
  
 (a) Provided the Purchaser has notified the Company of the
Purchaser’s intention to sell the Note Shares and the Note Shares are included in an effective registration statement or are otherwise exempt from registration when sold: (i) upon the conversion of the Note or part thereof, the Company shall,
at its own cost and expense, take all necessary action (including the issuance of an opinion of counsel reasonably acceptable to the Purchaser following a request by the Purchaser) to assure that the Company’s transfer agent shall issue shares
of the Company’s Common Stock in the name of the Purchaser (or its nominee) or such other persons as designated by the Purchaser in accordance with Section 9.1(b) hereof and in such denominations to be specified representing the number of Note
Shares issuable upon such conversion; and (ii) the Company warrants that no instructions other than these instructions have been or will be given to the transfer agent of the Company’s Common Stock and that after the Effectiveness Date (as
defined in the Registration Rights Agreement) the Note Shares issued will be freely transferable subject to the prospectus delivery requirements of the Securities Act and the provisions of this Agreement and the Registration Rights Agreement and
will not contain a legend restricting the resale or transferability of the Note Shares. 
  

 21 

 (b) Purchaser will give notice of its decision to exercise its right to convert the Note
or part thereof by telecopying or otherwise delivering an executed and completed notice of the number of shares to be converted to the Company (the “Notice of Conversion”). The Purchaser will not be required to surrender the Note until the
Purchaser receives (i) in the event that the Company is DWAC (as defined below) eligible, a credit to the account of the Purchaser’s prime broker through the DWAC system, or (ii) in the event that the Company is not DWAC eligible, stock
certificates representing the Note Shares or until the Note has been fully satisfied. Each date on which a Notice of Conversion is telecopied or delivered to the Company in accordance with the provisions hereof shall be deemed a “Conversion
Date.” Pursuant to the terms of the Notice of Conversion, the Company will issue instructions to the transfer agent accompanied by an opinion of counsel within one (1) business day of the date of the delivery to the Company of the Notice of
Conversion and shall cause the transfer agent to transmit the certificates representing the Conversion Shares to the Holder by (x) in the event that the Company is DWAC eligible, crediting the account of the Purchaser’s prime broker with the
Depository Trust Company (“DTC”) through its Deposit Withdrawal Agent Commission (“DWAC”) system or (y) in the event that the Company is not DWAC eligible, delivering stock certificates representing the Note Shares to the
Purchaser or the Purchaser’s designated broker, in each case, within three (3) business days after receipt by the Company of the Notice of Conversion (the “Delivery Date”). The provisions above relating to delivery of Conversion
Shares through the DWAC system shall not apply with respect to shares issuable to any person or entity other than Laurus Master Fund, Ltd., or an entity owned and controlled by it. 
  
 (c) The Company understands that a delay in the delivery of the Note Shares in the form required pursuant to
Section 9 hereof beyond the Delivery Date could result in economic loss to the Purchaser. In the event that the Company fails to direct its transfer agent to deliver the Note Shares to the Purchaser in the manner, and within the time frame, set
forth in Section 9.1(b) above and the Note Shares are not delivered to the Purchaser by the Delivery Date, as compensation to the Purchaser for such loss, the Company agrees to pay late payments to the Purchaser for late issuance of the Note Shares
in the form required pursuant to Section 9 hereof upon conversion of the Note in the amount equal to the greater of: (i) $500 per business day after the Delivery Date; or (ii) the Purchaser’s actual damages from such delayed delivery.
Notwithstanding the foregoing, the Company will not owe the Purchaser any late payments if the delay in the delivery of the Note Shares beyond the Delivery Date is solely out of the control of the Company and the Company is actively trying to cure
the cause of the delay. The Company shall pay any payments incurred under this Section in immediately available funds upon demand and, in the case of actual damages, accompanied by reasonable documentation of the amount of such damages. Such
documentation shall show the number of shares of Common Stock the Purchaser is forced to purchase (in an open market transaction) which the Purchaser anticipated receiving upon such conversion, and shall be calculated as the amount by which (A) the
Purchaser’s total purchase price (including customary brokerage commissions, if any) for the shares of Common Stock so purchased exceeds (B) the aggregate principal and/or interest amount of the Note, for which such Conversion Notice was not
timely honored. 
  

 22 

 Nothing contained herein or in any document referred to herein or delivered in connection herewith shall be deemed to
establish or require the payment of a rate of interest or other charges in excess of the maximum permitted by applicable law. In the event that the rate of interest or dividends required to be paid or other charges hereunder exceed the maximum
amount permitted by such law, any payments in excess of such maximum shall be credited against amounts owed by the Company to a Purchaser and thus refunded to the Company. 
  
 10. Registration Rights. 
  
 10.1 Registration Rights Granted. The Company hereby grants registration rights to the Purchaser pursuant to a Registration Rights Agreement dated
as of even date herewith between the Company and the Purchaser. 
  
 10.2 Offering Restrictions. Except as previously disclosed in the SEC Reports or in the Exchange Act Filings, or stock or stock options granted to employees or directors of the Company (these exceptions hereinafter referred to as the
“Excepted Issuances”), neither the Company nor any of its Subsidiaries will issue any securities with a continuously variable/floating conversion feature which are or could be (by conversion or registration) free-trading securities (i.e.
common stock subject to a registration statement) prior to the full repayment or conversion of the Note (together with all accrued and unpaid interest and fees related thereto) (the “Exclusion Period”). 
  
 11. Miscellaneous. 
  
 11.1 Governing Law. THIS AGREEMENT AND EACH RELATED AGREEMENT SHALL
BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAWS. ANY ACTION BROUGHT BY EITHER PARTY AGAINST THE OTHER CONCERNING THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT AND
EACH RELATED AGREEMENT SHALL BE BROUGHT ONLY IN THE STATE COURTS OF NEW YORK OR IN THE FEDERAL COURTS LOCATED IN THE STATE OF NEW YORK. BOTH PARTIES AND THE INDIVIDUALS EXECUTING THIS AGREEMENT AND THE RELATED AGREEMENTS ON BEHALF OF THE COMPANY
AGREE TO SUBMIT TO THE JURISDICTION OF SUCH COURTS AND WAIVE TRIAL BY JURY. IN THE EVENT THAT ANY PROVISION OF THIS AGREEMENT OR ANY RELATED AGREEMENT DELIVERED IN CONNECTION HEREWITH IS INVALID OR UNENFORCEABLE UNDER ANY APPLICABLE STATUTE OR RULE
OF LAW, THEN SUCH PROVISION SHALL BE DEEMED INOPERATIVE TO THE EXTENT THAT IT MAY CONFLICT THEREWITH AND SHALL BE DEEMED MODIFIED TO CONFORM WITH SUCH STATUTE OR RULE OF LAW. ANY SUCH PROVISION WHICH MAY PROVE INVALID OR UNENFORCEABLE UNDER ANY LAW
SHALL NOT AFFECT THE VALIDITY OR ENFORCEABILITY OF ANY OTHER PROVISION OF THIS AGREEMENT OR ANY RELATED AGREEMENT. 
  
 11.2 Survival. The representations, warranties, covenants and agreements made herein shall survive any investigation made by the Purchaser and the
closing of the transactions contemplated hereby to the extent provided therein. All statements as to factual 
  

 23 

 matters contained in any certificate or other instrument delivered by or on behalf of the Company pursuant hereto in
connection with the transactions contemplated hereby shall be deemed to be representations and warranties by the Company hereunder solely as of the date of such certificate or instrument. 
  
 11.3 Successors. Except as otherwise expressly provided herein, the provisions hereof shall inure to the benefit of,
and be binding upon, the successors, heirs, executors and administrators of the parties hereto and shall inure to the benefit of and be enforceable by each person who shall be a holder of the Securities from time to time, other than the holders of
Common Stock which has been sold by the Purchaser pursuant to Rule 144 or an effective registration statement. Purchaser may not assign its rights hereunder to a competitor of the Company. 
  
 11.4 Entire Agreement. This Agreement, the Related Agreements, the
exhibits and schedules hereto and thereto and the other documents delivered pursuant hereto constitute the full and entire understanding and agreement between the parties with regard to the subjects hereof and no party shall be liable or bound to
any other in any manner by any representations, warranties, covenants and agreements except as specifically set forth herein and therein. 
  
 11.5 Severability. In case any provision of the Agreement shall be invalid, illegal or unenforceable, the validity, legality and enforceability of
the remaining provisions shall not in any way be affected or impaired thereby. 
  
 11.6 Amendment and Waiver. 
  
 (a) This Agreement may be amended or modified only upon the written consent of the Company and the Purchaser. 
  
 (b) The obligations of the Company and the rights of the Purchaser under this Agreement may be waived only with the written consent of the
Purchaser. 
  
 (c) The obligations of the
Purchaser and the rights of the Company under this Agreement may be waived only with the written consent of the Company. 
  
 11.7 Delays or Omissions. It is agreed that no delay or omission to exercise any right, power or remedy accruing to any party, upon any breach,
default or noncompliance by another party under this Agreement or the Related Agreements, shall impair any such right, power or remedy, nor shall it be construed to be a waiver of any such breach, default or noncompliance, or any acquiescence
therein, or of or in any similar breach, default or noncompliance thereafter occurring. All remedies, either under this Agreement or the Related Agreements, by law or otherwise afforded to any party, shall be cumulative and not alternative.

  
 11.8 Notices. All notices required or permitted
hereunder shall be in writing and shall be deemed effectively given: 
  
 (a) upon personal delivery to the party to be notified; 
  

 24 

 (b) when sent by confirmed facsimile if sent during normal business hours of the
recipient, if not, then on the next business day; 
  
 (c) three (3) business days after having been sent by registered or certified mail, return receipt requested, postage prepaid; or 
  
 (d) one (1) day after deposit with a nationally recognized overnight courier, specifying next day delivery, with written verification of
receipt. 
  
 All communications shall be sent as follows: 
  

			
	 If to the Company, to:
	  	 Dynamic Health Solutions, Inc.
 6911 Bryan Dairy Road,
Suite 210
 Largo, Florida 33777
 Attention: Cani
Shuman
 Facsimile: (727_ 329-1846

		
	 	  	with a copy to:
		
	 	  	 Shumaker, Loop & Kendrick, LLP
 101 East Kennedy
Boulevard, Suite 2800
 Tampa, Florida 33602

	 	  	 Attention: Gregory C. Yadley, Esq.
 Facsimile: (813)
229-1660

		
	 If to the Purchaser, to:
	  	 Laurus Master Fund, Ltd.
 c/o M&C Corporate
Services Ltd.
 P.O. Box 309GT
 Ugland House, George
Town
 South Church Street
 Grand Cayman, Cayman
Islands
 Facsimile: 345-949-808

		
	 	  	with a copy to:
		
	 	  	 John E. Tucker, Esq.
 825 Third Avenue 14th
Floor
 New York, NY 10022
 Facsimile:
212-541-4434

  
 or at such other address as the
Company or the Purchaser may designate by written notice to the other parties hereto given in accordance herewith. 
  
 11.9 Attorneys’ Fees. In the event that any suit or action is instituted to enforce any provision in this Agreement, the prevailing party in
such dispute shall be entitled to recover from the losing party all fees, costs and expenses of enforcing any right of such prevailing party under or with respect to this Agreement, including, without limitation, such reasonable fees and expenses of
attorneys and accountants, which shall include, without limitation, all fees, costs and expenses of appeals. 
  

 25 

 11.10 Titles and Subtitles. The titles of the sections and subsections of this Agreement are for
convenience of reference only and are not to be considered in construing this Agreement. 
  
 11.11 Facsimile Signatures; Counterparts. This Agreement may be executed by facsimile signatures and in any number of counterparts, each of which shall be an original, but all of which together shall constitute
one instrument. 
  
 11.12 Broker’s Fees. Except as set
forth on Schedule 11.12 hereof, each party hereto represents and warrants that no agent, broker, investment banker, person or firm acting on behalf of or under the authority of such party hereto is or will be entitled to any broker’s or
finder’s fee or any other commission directly or indirectly in connection with the transactions contemplated herein. Each party hereto further agrees to indemnify each other party for any claims, losses or expenses incurred by such other party
as a result of the representation in this Section 11.12 being untrue. 
  
 11.13 Construction. Each party acknowledges that its legal counsel participated in the preparation of this Agreement and the Related Agreements and, therefore, stipulates that the rule of construction that ambiguities are to be
resolved against the drafting party shall not be applied in the interpretation of this Agreement to favor any party against the other. 
  
 [THE REMAINDER OF THIS PAGE IS INTENTIONALLY LEFT BLANK] 
  

 26 

 IN WITNESS WHEREOF, the parties hereto have executed the SECURITIES PURCHASE AGREEMENT as of the date set
forth in the first paragraph hereof. 
  

							
	 COMPANY:
	 	 PURCHASER:

		
	 DYNAMIC HEALTH PRODUCTS, INC.
	 	 LAURUS MASTER FUND, LTD.

				
	 By:
	 	 /s/ Mandeep K. Taneja

	 	 By:
	 	 /s/ David Grin

	 Name:
	 	 Mandeep K. Taneja
  
	 	 Name:
	 	 David Grin

	 Title:
	 	 CEO
  
	 	 Title:
	 	 Partner

  

 27

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