Document:

Exhibit 10.1

 

SECURITIES
PURCHASE AGREEMENT

 

This Securities Purchase
Agreement (this “Agreement”) is dated as of May 11, 2018, between Stellar Biotechnologies, Inc., a British Columbia
corporation (the “Company”), and each purchaser identified on the signature pages hereto (each, including its
successors and assigns, a “Purchaser” and collectively the “Purchasers”).

 

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

 

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

 

ARTICLE I.

DEFINITIONS

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

“Closing
Date” means the Trading Day on which all of the Transaction Documents have been executed and delivered by the applicable
parties thereto, and all conditions precedent to (i) the Purchasers’ obligations to pay the Subscription Amount and (ii)
the Company’s obligations to deliver the Securities, in each case, have been satisfied or waived, but in no event later than
the second (2nd) Trading Day following the date hereof.

 

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

 

“Common
Shares” means the common shares of the Company, no par value per share, and any other class of securities into which
such securities may hereafter be reclassified or changed.

 

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

 

“Common
Units” means each Common Unit consisting of (a) one Share, and (b) a Common Warrant to purchase one Common Warrant Share.

 

“Common
Unit Purchase Price” equals $2.65 per each Common Unit, subject to adjustment for reverse and forward stock splits, stock
dividends, stock combinations and other similar transactions of the Common Shares that occur after the date of this Agreement.

 

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

 

“Common
Warrants” means, collectively, the Common Share purchase warrants delivered to the Purchasers at the Closing in accordance
with Section 2.2(a) hereof, which Common Warrants shall be exercisable immediately and have a term of exercise equal to five (5)
years, in the form of Exhibit A-1 attached hereto.

 

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

 

“Company
Canadian Counsel” means McMillan LLP, with offices located at Royal Centre, 1055 W. Georgia Street, Vancouver, British
Columbia, Canada.

 

“Company
U.S. Counsel” means Greenberg Traurig, LLP, with offices located at 1840 Century Park East, Suite 1900, Los Angeles,
California 90067.

 

“Disclosure
Time” means, (i) if this Agreement is signed on any day that is not a Trading Day or after 9:00 a.m. (New York City time)
and before midnight (New York City time) on any Trading Day, 9:01 a.m. (New York City time) on the Trading Day immediately following
the date hereof, unless otherwise instructed to an earlier time by the Placement Agent (ii) if this Agreement is signed between
midnight (New York City time) and 9:00 a.m. (New York City time) on any Trading Day, no later than 9:01 a.m. (New York City time)
on the date hereof, unless otherwise instructed to an earlier time by the Placement Agent.

 

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“EGS”
means Ellenoff Grossman & Schole LLP, with offices located at 1345 Avenue of the Americas, New York, New York 10105-0302.

 

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

 

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

 

“Exempt
Issuance” means the issuance of (a) Common Shares or options to employees, officers, directors, consultants or advisors
of the Company pursuant to any share or option plan duly adopted for such purpose, by a majority of the non-employee members of
the Board of Directors or a majority of the members of a committee of non-employee directors established for such purpose for services
rendered to the Company, provided that such securities issued to consultants or advisors are issued as “restricted securities”
(as defined in Rule 144) and carry no registration rights that require or permit the filing of any registration statement in connection
therewith during the prohibition period in Section 4.11(a) herein and are limited to 100,000 shares per 6 month period, in the
aggregate, (b) securities upon the exercise or exchange of or conversion of any Securities issued hereunder and/or other securities
exercisable or exchangeable for or convertible into Common Shares issued and outstanding on the date of this Agreement, provided
that such securities have not been amended since the date of this Agreement to increase the number of such securities or to decrease
the exercise price, exchange price or conversion price of such securities (other than in connection with share splits or combinations)
or to extend the term of such securities, (c) securities issued pursuant to acquisitions or strategic transactions, which may include
without limitation, transactions with any of the Company’s partners, customers or suppliers (the “Company Partners”),
and which transaction is approved by a majority of the disinterested directors of the Company, provided that such securities are
issued as “restricted securities” (as defined in Rule 144) and carry no registration rights that require or permit
the filing of any registration statement in connection therewith during the prohibition period in Section 4.11(a) herein, and provided
that any such issuance shall only be to a Person (or to the equityholders of a Person) which is, itself or through its subsidiaries,
an operating company or an owner of an asset in a business synergistic with the business of the Company and shall provide to the
Company additional benefits in addition to the investment of funds, but shall not include a transaction in which the Company is
issuing securities solely for the purpose of raising capital or to an entity whose primary business is investing in securities,
and (d) up to $2,500,000 of Units, including the Common Shares, Pre-Funded Warrants, and Warrants issued to other purchasers pursuant
to the Prospectus concurrently with the Closing at the applicable Common Unit Purchase Price or Pre-Funded Unit Purchase Price.

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

“Pharmaceutical
Product” shall have the meaning ascribed to such term in Section 3.1(hh).

 

“Placement
Agent” means H.C. Wainwright & Co., LLC.

 

“Pre-Funded
Units” means each Pre-Funded Unit consisting of (a) one Pre-Funded Warrant to purchase one Pre-Funded Warrant Share,
and (b) a Common Warrant to purchase one Common Warrant Share.

 

“Pre-Funded
Unit Purchase Price” equals $2.64 per each Pre-Funded Unit, subject to adjustment for reverse and forward stock splits,
stock dividends, stock combinations and other similar transactions of the Common Shares that occur after the date of this Agreement.

 

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

 

“Pre-Funded
Warrants” means, collectively, the Common Share purchase warrants delivered to the Purchasers at the Closing in accordance
with Section 2.2(a) hereof, which Pre-Funded Warrants shall be exercisable immediately and shall expire when exercised in full,
in the form of Exhibit A-2 attached hereto.

 

“Pre-Funded
Warrant Shares” means the Common Shares issuable upon exercise of the Pre-Funded Warrants.

 

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“Preliminary
Prospectus” means the preliminary prospectus dated May 7, 2018, filed with the Commission.

 

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

 

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

 

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

 

“Registration
Statement” means the effective registration statement with Commission file No. 333-224314 which registers the sale of
the Securities to the Purchasers.

 

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

 

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

 

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

 

“SEC
Reports” means all reports, schedules, forms, statements and other documents required to be filed by the Company under
the Securities Act and the Exchange Act, including pursuant to Section 13(a) or 15(d) thereof, for the two years preceding the
date of this Agreement, including the exhibits thereto and documents incorporated by reference therein, together with the Preliminary
Prospectus and the Prospectus.

 

“Securities”
means the Units, the Shares, the Warrants, the Pre-Funded Warrants and the Warrant Shares.

 

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

 

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

 

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

 

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“Subscription
Amount” means the Common Unit Subscription Amount and/or the Pre-Funded Unit Subscription Amount, as applicable, in accordance
with the terms of Section 2.1 of this Agreement.

 

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

 

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

 

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

 

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

 

“Transfer
Agent” means Computershare Investor Services, Inc., the current transfer agent of the Company, with a mailing address
of 510 Burrard Street, 3rd Floor, Vancouver, British Columbia V6C 3B9, and any successor transfer agent of the Company.

 

“Units”
means, collectively, the Common Units and the Pre-Funded Units.

 

“Variable
Rate Transaction” shall have the meaning ascribed to such term in Section 4.11(b).

 

“Warrants”
means, collectively, Common Warrants and the Pre-Funded Warrants.

 

“Warrant
Shares” means the Common Shares issuable upon exercise of the Pre-Funded Warrant and the Common Warrants.

 

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ARTICLE II.

PURCHASE AND SALE

 

2.1          Closing.
On the Closing Date, upon the terms and subject to the conditions set forth herein, substantially concurrent with the execution
and delivery of this Agreement by the parties hereto, the Company agrees to sell, and the Purchasers, severally and not jointly,
agree to purchase, up to an aggregate of $3,000,000 of Common Units as determined pursuant to Section 2.2(a); provided,
however, that, solely to the extent a Purchaser determines that such Purchaser (together with such Purchaser’s Affiliates,
and any Person acting as a group together with such purchaser or any of such Purchaser’s Affiliates) would beneficially own
in excess of the Beneficial Ownership Limitation, in lieu of purchasing Common Units, such Purchaser may elect to purchase Pre-Funded
Units at the Pre-Funded Unit Purchase Price in lieu of Common Units. The “Beneficial Ownership Limitation” shall
be 4.99% (or, at the election of the Purchaser, 9.99%) of the number of Common Shares outstanding immediately after giving effect
to the issuance of the Securities on the Closing Date. Unless otherwise directed by the Placement Agent, each Purchaser shall deliver,
via wire transfer or a certified check, immediately available funds equal to its Subscription Amount pursuant to Section 2.2(b)(ii),
and the Company shall deliver to each Purchaser its respective Shares and Common Warrants or Pre-Funded Warrants (as applicable
to such Purchaser) and Common Warrants, as determined pursuant to Section 2.2(a), and the Company and each Purchaser shall deliver
the other items set forth in Section 2.2 deliverable at the Closing. Upon satisfaction of the covenants and conditions set forth
in Sections 2.2 and 2.3, the Closing shall occur at the offices of EGS or such other location as the parties shall mutually agree.
Each Purchaser acknowledges that, concurrently with the Closing and pursuant to the Prospectus, the Company may sell up to $2,500,000
of additional Units to purchasers not party to this Purchase Agreement, and will issue to each such purchaser such additional Common
Shares and Common Warrants or Pre-Funded Warrants and Common Warrants in the same form and at the same Common Unit Purchase Price
or Pre-Funded Unit Purchase Price. The Company covenants that, if the Purchaser delivers a Notice of Exercise (as defined in the
Pre-Funded Warrant) no later than 12:00 p.m. (New York City time) on the Closing Date to exercise and Pre-Funded Warrants between
the date hereof and the Closing Date, the Company shall deliver Pre-Funded Warrant Shares to the Purchaser on the Closing Date
in connection with such Notice of Exercise. Unless otherwise directed by the Placement Agent, settlement of the Shares shall occur
via “Delivery Versus Payment” (“DVP”) (i.e., on the Closing Date, the Company shall issue the Shares
registered in the Purchasers’ names and addresses and released by the Transfer Agent directly to the account(s) at the Placement
Agent identified by each Purchaser; upon receipt of such Shares, the Placement Agent shall promptly electronically deliver such
Shares to the applicable Purchaser, and payment therefor shall be made by the Placement Agent (or its clearing firm) by wire transfer
to the Company).

 

2.2          Deliveries.

 

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

 

(i)          this
Agreement duly executed by the Company;

 

(ii)         a
legal opinion of Company Canadian Counsel and Company U.S. Counsel, in a form acceptable to the Placement Agent and Purchasers;

 

(iii)        subject
to the last sentence of Section 2.1, the Company shall have provided each Purchaser with the Company’s wire instructions,
on Company letterhead and executed by the Chief Executive Officer or Chief Financial Officer;

 

(iv)        subject
to the last sentence of Section 2.1, a copy of the irrevocable instructions to the Transfer Agent instructing the Transfer Agent
to deliver on an expedited basis via The Depository Trust Company Deposit or Withdrawal at Custodian system (“DWAC”)
Shares equal to such Purchaser’s Common Unit Subscription Amount divided by the Common Unit Purchase Price, registered in
the name of such Purchaser;

 

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(v)         for
each Purchaser of Pre-Funded Units, a Pre-Funded Warrant registered in the name of such Purchaser to purchase up to a number of
Common Shares equal to such Purchaser’s Pre-Funded Unit Subscription Amount divided by the Pre-Funded Unit Purchase Price,
with an exercise price equal to $0.01, subject to adjustment therein (such Pre-Funded Warrant certificate may be delivered within
three Trading Days of the Closing Date);

 

(vi)        a
Common Warrant registered in the name of such Purchaser to purchase up to a number of Common Shares equal to 100% of such Purchaser’s
Shares, with an exercise price equal to $2.65, subject to adjustment therein (such Common Warrant certificate may be delivered
within three Trading Days of the Closing Date); and

 

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

 

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

 

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

 

(ii)         such
Purchaser’s Subscription Amount, which shall be made available for “Delivery Versus Payment” settlement with
the Company or its designees.

 

2.3          Closing
Conditions.

 

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

 

(i)          the
accuracy in all material respects (or, to the extent representations or warranties are qualified by materiality or Material Adverse
Effect, in all respects) when made and on the Closing Date of the representations and warranties of the Purchasers contained herein
(unless as of a specific date therein in which case they shall be accurate as of such date);

 

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

 

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

 

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

 

(i)          the
accuracy in all material respects (or, to the extent representations or warranties are qualified by materiality or Material Adverse
Effect, in all respects) when made and on the Closing Date of the representations and warranties of the Company contained herein
(unless as of a specific date therein in which case they shall be accurate as of such date);

 

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

 

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

 

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

 

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

 

ARTICLE III.

REPRESENTATIONS AND WARRANTIES

 

3.1          Representations
and Warranties of the Company. The Company hereby makes the following representations and warranties to each Purchaser:

 

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

 

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

 

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

 

(d)          No
Conflicts or Breach. The execution, delivery and performance by the Company of this Agreement and the other Transaction Documents
to which it is a party, the issuance and sale of the Securities and the consummation by it of the transactions contemplated hereby
and thereby do not and will not (i) conflict with or violate any provision of the Company’s or any Subsidiary’s certificate
or articles of incorporation, bylaws or other organizational or charter documents, as applicable or (ii) conflict with, or constitute
a default (or an event that with notice or lapse of time or both would become a default) under, result in the creation of any Lien
upon any of the properties or assets of the Company or any Subsidiary, or give to others any rights of termination, amendment,
anti-dilution or similar adjustments, acceleration or cancellation (with or without notice, lapse of time or both) of, any agreement,
credit facility, debt or other instrument (evidencing a Company or Subsidiary debt or otherwise) or other understanding to which
the Company or any Subsidiary is a party or by which any property or asset of the Company or any Subsidiary is bound or affected,
or (iii) subject to the Required Approvals, conflict with or result in a violation of any law, rule, regulation, order, judgment,
injunction, decree or other restriction of any court or governmental authority to which the Company or a Subsidiary is subject
(including federal and state securities laws and regulations), or by which any property or asset of the Company or a Subsidiary
is bound or affected; except in the case of each of clauses (ii) and (iii), such as could not have or reasonably be expected to
result in a Material Adverse Effect. Neither the Company, its subsidiaries nor, to its knowledge, any other party is in violation,
breach or default of any agreement, lease, credit facility, debt, note, bond, mortgage, indenture or other instrument that is reasonably
likely to result in a Material Adverse Effect.

 

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

 

(f)          Issuance
of the Securities; Registration. The Securities are duly authorized and, when issued and paid for in accordance with the applicable
Transaction Documents, will be duly and validly issued, fully paid and nonassessable, free and clear of all Liens imposed by the
Company. The Warrant Shares, when issued in accordance with the terms of the Warrants, will be validly issued, fully paid and nonassessable,
free and clear of all Liens imposed by the Company. The Company has reserved from its duly authorized capital share the maximum
number of Common Shares issuable pursuant to this Agreement and the Warrants. The Company has prepared and filed the Registration
Statement in conformity with the requirements of the Securities Act, which became effective on May 10, 2018 (the “Effective
Date”), including the Prospectus, and such amendments and supplements thereto as may have been required to the date of
this Agreement. The Registration Statement is effective under the Securities Act and no stop order preventing or suspending the
effectiveness of the Registration Statement or suspending or preventing the use of the Preliminary Prospectus or the Prospectus
has been issued by the Commission and no proceedings for that purpose have been instituted or, to the knowledge of the Company,
are threatened by the Commission. The Company, if required by the rules and regulations of the Commission, shall file the Prospectus
with the Commission pursuant to Rule 424(b). At the time the Registration Statement and any amendments thereto became effective,
at the date of this Agreement and at the Closing Date, the Registration Statement and any amendments thereto conformed and will
conform in all material respects to the requirements of the Securities Act and did not and will not contain any untrue statement
of a material fact or omit to state any material fact required to be stated therein or necessary to make the statements therein
not misleading; and the Preliminary Prospectus and the Prospectus and any amendments or supplements thereto, at the time the Preliminary
Prospectus and the Prospectus or any amendment or supplement thereto was issued and at the Closing Date, conformed and will conform
in all material respects to the requirements of the Securities Act and did not and will not contain an untrue statement of a material
fact or omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances under
which they were made, not misleading.

 

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(g)          Capitalization.
The capitalization of the Company is as set forth on Schedule 3.1(g). The Company has not issued any common shares since
its most recently filed periodic report under the Exchange Act. No Person has any right of first refusal, preemptive right, right
of participation, or any similar right to participate in the transactions contemplated by the Transaction Documents. Except as
a result of the purchase and sale of the Securities, and except as set forth on Schedule 3.1(g), there are no outstanding
options, warrants, scrip rights to subscribe to, calls or commitments of any character whatsoever relating to, or securities, rights
or obligations convertible into or exercisable or exchangeable for, or giving any Person any right to subscribe for or acquire,
any Common Shares or the capital share of any Subsidiary, or contracts, commitments, understandings or arrangements by which the
Company or any Subsidiary is or may become bound to issue additional Common Shares or Common Share Equivalents or capital share
of any Subsidiary. The issuance and sale of the Securities will not obligate the Company or any Subsidiary to issue Common Shares
or other securities to any Person (other than the Purchasers) and will not result in a right of any holder of Company securities
to adjust the exercise, conversion, exchange or reset price under any of such securities. Except as set forth on Schedule 3.1(g),
there are no outstanding securities or instruments of the Company or any Subsidiary that contain any redemption or similar provisions,
and there are no contracts, commitments, understandings or arrangements by which the Company or any Subsidiary is or may become
bound to redeem a security of the Company or such Subsidiary. The Company does not have any share appreciation rights or “phantom
share” plans or agreements or any similar plan or agreement. All of the outstanding shares of the Company are duly authorized,
validly issued, fully paid and nonassessable, have been issued in compliance with all federal and state securities laws, and none
of such outstanding shares was issued in violation of any preemptive rights or similar rights to subscribe for or purchase securities.
No further approval or authorization of any shareholder, the Board of Directors or others is required for the issuance and sale
of the Securities. There are no shareholders agreements, voting agreements or other similar agreements with respect to the Company’s
capital share to which the Company is a party or, to the knowledge of the Company, between or among any of the Company’s
shareholders.

 

(h)          SEC
Reports; Financial Statements. Other than the 8-K due to be filed with the SEC on April 2, 2018, relating to, among other things,
the results of the Company’s annual meeting of shareholders held on March 27, 2018, which 8-K was filed on April 3, 2018,
the Company has filed all SEC Reports on a timely basis or has received a valid extension of such time of filing and has filed
any such SEC Reports prior to the expiration of any such extension. As of their respective dates, the SEC Reports complied in all
material respects with the requirements of the Securities Act and the Exchange Act, as applicable, and none of the SEC Reports,
when filed, contained any untrue statement of a material fact or omitted to state a material fact required to be stated therein
or necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading.
The Company has not been an issuer subject to Rule 144(i) under the Securities Act during the past three years. The financial statements
of the Company included in the SEC Reports comply in all material respects with applicable accounting requirements and the rules
and regulations of the Commission with respect thereto as in effect at the time of filing. Such financial statements have been
prepared in accordance with United States generally accepted accounting principles applied on a consistent basis during the periods
involved (“GAAP”), except as may be otherwise specified in such financial statements or the notes thereto and
except that unaudited financial statements may not contain all footnotes required by GAAP, and fairly present in all material respects
the financial position of the Company and its consolidated Subsidiaries as of and for the dates thereof and the results of operations
and cash flows for the periods then ended, subject, in the case of unaudited statements, to normal, immaterial, year-end audit
adjustments.

 

    	 	12	 

     

    

 

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

 

(j)          Litigation.
Except as set forth on Schedule 3.1(j), there is no action, suit, inquiry, notice of violation, proceeding or investigation
pending or, to the knowledge of the Company, threatened against or affecting the Company, any Subsidiary or any of their respective
properties before or by any court, arbitrator, governmental or administrative agency or regulatory authority (federal, state, county,
local or foreign) (collectively, an “Action”). No Action set forth on Schedule 3.1(j) (i) adversely affects
or challenges the legality, validity or enforceability of any of the Transaction Documents or the Securities or (ii) could, if
there were an unfavorable decision, have or reasonably be expected to result in a Material Adverse Effect. Neither the Company
nor any Subsidiary, nor any director or officer thereof, is or has been the subject of any Action involving a claim of violation
of or liability under federal or state securities laws or a claim of breach of fiduciary duty. There has not been, and to the knowledge
of the Company, there is not pending or contemplated, any investigation by the Commission involving the Company or any current
or former director or officer of the Company. The Commission has not issued any stop order or other order suspending the effectiveness
of any registration statement filed by the Company or any Subsidiary under the Exchange Act or the Securities Act.

 

    	 	13	 

     

    

 

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

 

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

 

    	 	14	 

     

    

 

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

 

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

 

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

 

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

 

    	 	15	 

     

    

 

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

 

(r)          Transactions
With Affiliates and Employees. Except as set forth on Schedule 3.1(r), none of the officers or directors of the Company
or any Subsidiary and, to the knowledge of the Company, none of the employees of the Company or any Subsidiary is presently a party
to any transaction with the Company or any Subsidiary (other than for services as employees, officers and directors), including
any contract, agreement or other arrangement providing for the furnishing of services to or by, providing for rental of real or
personal property to or from, providing for the borrowing of money from or lending of money to or otherwise requiring payments
to or from any officer, director or such employee or, to the knowledge of the Company, any entity in which any officer, director,
or any such employee has a substantial interest or is an officer, director, trustee, shareholder, member or partner, in each case
in excess of $120,000 other than for (i) payment of salary or consulting fees for services rendered, (ii) reimbursement for expenses
incurred on behalf of the Company and (iii) other employee benefits, including share option agreements under any share option plan
of the Company.

 

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

 

    	 	16	 

     

    

 

(t)          Certain
Fees. Except as set forth in the Preliminary Prospectus or the Prospectus, no brokerage or finder’s fees or commissions
are or will be payable by the Company or any Subsidiary to any broker, financial advisor or consultant, finder, placement agent,
investment banker, bank or other Person with respect to the transactions contemplated by the Transaction Documents. The Purchasers
shall have no obligation with respect to any fees or with respect to any claims made by or on behalf of other Persons for fees
of a type contemplated in this Section that may be due in connection with the transactions contemplated by the Transaction Documents.

 

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

 

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

 

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

 

    	 	17	 

     

    

 

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

 

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

 

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

 

    	 	18	 

     

    

 

(aa)         Solvency.
Based on the consolidated financial condition of the Company as of the Closing Date, after giving effect to the receipt by the
Company of the proceeds from the sale of the Securities hereunder, (i) the fair saleable value of the Company’s assets exceeds
the amount that will be required to be paid on or in respect of the Company’s existing debts and other liabilities (including
known contingent liabilities) as they mature, (ii) the Company’s assets do not constitute unreasonably small capital to carry
on its business as now conducted and as proposed to be conducted including its capital needs taking into account the particular
capital requirements of the business conducted by the Company, consolidated and projected capital requirements and capital availability
thereof, and (iii) the current cash flow of the Company, together with the proceeds the Company would receive, were it to liquidate
all of its assets, after taking into account all anticipated uses of the cash, would be sufficient to pay all amounts on or in
respect of its liabilities when such amounts are required to be paid. The Company does not intend to incur debts beyond its ability
to pay such debts as they mature (taking into account the timing and amounts of cash to be payable on or in respect of its debt).
The Company has no knowledge of any facts or circumstances which lead it to believe that it will file for reorganization or liquidation
under the bankruptcy or reorganization laws of any jurisdiction within one year from the Closing Date. Schedule 3.1(aa)
sets forth as of the date hereof all outstanding secured and unsecured Indebtedness of the Company or any Subsidiary, or for which
the Company or any Subsidiary has commitments. For the purposes of this Agreement, “Indebtedness” means (x)
any liabilities for borrowed money or amounts owed in excess of $50,000 (other than trade accounts payable incurred in the ordinary
course of business), (y) all guaranties, endorsements and other contingent obligations in respect of indebtedness of others, whether
or not the same are or should be reflected in the Company’s consolidated balance sheet (or the notes thereto), except guaranties
by endorsement of negotiable instruments for deposit or collection or similar transactions in the ordinary course of business;
and (z) the present value of any lease payments in excess of $50,000 due under leases required to be capitalized in accordance
with GAAP. Neither the Company nor any Subsidiary is in default with respect to any Indebtedness.

 

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

 

    	 	19	 

     

    

 

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

 

(dd)         Accountants.
Moss Adams LLP is the Company’s independent registered public accounting firm. To the knowledge and belief of the Company,
such accounting firm (i) is a registered public accounting firm as required by the Exchange Act and (ii) shall express its opinion
with respect to the financial statements to be included in the Company’s Annual Report for the fiscal year ending September
30, 2018.        

 

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

 

(ff)         Acknowledgment
Regarding Purchaser’s Trading Activity. Anything in this Agreement or elsewhere herein to the contrary notwithstanding
(except for Sections 3.2(e) and 4.13 hereof), it is understood and acknowledged by the Company that: (i) none of the Purchasers
has been asked by the Company to agree, nor has any Purchaser agreed, to desist from purchasing or selling, long and/or short,
securities of the Company, or “derivative” securities based on securities issued by the Company or to hold the Securities
for any specified term; (ii) past or future open market or other transactions by any Purchaser, specifically including, without
limitation, Short Sales or “derivative” transactions, before or after the closing of this or future private placement
transactions, may negatively impact the market price of the Company’s publicly-traded securities; (iii) any Purchaser, and
counter-parties in “derivative” transactions to which any such Purchaser is a party, directly or indirectly, presently
may have a “short” position in the Common Shares, and (iv) each Purchaser shall not be deemed to have any affiliation
with or control over any arm’s length counter-party in any “derivative” transaction. The Company further understands
and acknowledges that (y) one or more Purchasers may engage in hedging activities at various times during the period that the Securities
are outstanding, including, without limitation, during the periods that the value of the Warrant Shares deliverable with respect
to Securities are being determined, and (z) such hedging activities (if any) could reduce the value of the existing shareholders'
equity interests in the Company at and after the time that the hedging activities are being conducted.  The Company acknowledges
that such aforementioned hedging activities do not constitute a breach of any of the Transaction Documents.

 

    	 	20	 

     

    

 

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

 

(hh)         FDA.
As to each product subject to the jurisdiction of the U.S. Food and Drug Administration (“FDA”) under the Federal
Food, Drug and Cosmetic Act, as amended, and the regulations thereunder (“FDCA”) that is manufactured, packaged,
labeled, tested, distributed, sold, and/or marketed by the Company or any of its Subsidiaries (each such product, a “Pharmaceutical
Product”), such Pharmaceutical Product is being manufactured, packaged, labeled, tested, distributed, sold and/or marketed
by the Company in compliance with all applicable requirements under FDCA and similar laws, rules and regulations relating to registration,
investigational use, premarket clearance, licensure, or application approval, good manufacturing practices, good laboratory practices,
good clinical practices, product listing, quotas, labeling, advertising, record keeping and filing of reports, except where the
failure to be in compliance would not have a Material Adverse Effect. There is no pending, completed or, to the Company's knowledge,
threatened, action (including any lawsuit, arbitration, or legal or administrative or regulatory proceeding, charge, complaint,
or investigation) against the Company or any of its Subsidiaries, and none of the Company or any of its Subsidiaries has received
any notice, warning letter or other communication from the FDA or any other governmental entity, which (i) contests the premarket
clearance, licensure, registration, or approval of, the uses of, the distribution of, the manufacturing or packaging of, the testing
of, the sale of, or the labeling and promotion of any Pharmaceutical Product, (ii) withdraws its approval of, requests the recall,
suspension, or seizure of, or withdraws or orders the withdrawal of advertising or sales promotional materials relating to, any
Pharmaceutical Product, (iii) imposes a clinical hold on any clinical investigation by the Company or any of its Subsidiaries,
(iv) enjoins production at any facility of the Company or any of its Subsidiaries, (v) enters or proposes to enter into a consent
decree of permanent injunction with the Company or any of its Subsidiaries, or (vi) otherwise alleges any violation of any laws,
rules or regulations by the Company or any of its Subsidiaries, and which, either individually or in the aggregate, would have
a Material Adverse Effect. The properties, business and operations of the Company have been and are being conducted in all material
respects in accordance with all applicable laws, rules and regulations of the FDA.  The Company has not been informed by the
FDA that the FDA will prohibit the marketing, sale, license or use in the United States of any product proposed to be developed,
produced or marketed by the Company nor has the FDA expressed any concern as to approving or clearing for marketing any product
being developed or proposed to be developed by the Company.

 

    	 	21	 

     

    

 

(ii)         Stock
Option Plans. Each share option granted by the Company under the Company’s share option plan was granted (i) in accordance
with the terms of the Company’s share option plan and (ii) with an exercise price at least equal to the fair market value
of the Common Shares on the date such share option would be considered granted under GAAP and applicable law. No share option granted
under the Company’s share option plan has been backdated. The Company has not knowingly granted, and there is no and has
been no Company policy or practice to knowingly grant, share options prior to, or otherwise knowingly coordinate the grant of share
options with, the release or other public announcement of material information regarding the Company or its Subsidiaries or their
financial results or prospects.

 

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

 

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

 

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

 

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

 

    	 	22	 

     

    

 

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

 

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

 

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

 

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

 

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

 

    	 	23	 

     

    

 

(e)          Access
to Information. Such Purchaser acknowledges that it has had the opportunity to review the Transaction Documents (including
all exhibits and schedules thereto) and the SEC Reports and has been afforded, (i) the opportunity to ask such questions as it
has deemed necessary of, and to receive answers from, representatives of the Company concerning the terms and conditions of the
offering of the Securities and the merits and risks of investing in the Securities; (ii) access to information about the Company
and its financial condition, results of operations, business, properties, management and prospects sufficient to enable it to evaluate
its investment; and (iii) the opportunity to obtain such additional information that the Company possesses or can acquire without
unreasonable effort or expense that is necessary to make an informed investment decision with respect to the investment. 
Such Purchaser acknowledges and agrees that neither the Placement Agent nor any Affiliate of the Placement Agent has provided such
Purchaser with any information or advice with respect to the Securities nor is such information or advice necessary or desired. 
Neither the Placement Agent nor any Affiliate has made or makes any representation as to the Company or the quality of the Securities
and the Placement Agent and any Affiliate may have acquired non-public information with respect to the Company which such Purchaser
agrees need not be provided to it.  In connection with the issuance of the Securities to such Purchaser, neither the Placement
Agent nor any of its Affiliates has acted as a financial advisor or fiduciary to such Purchaser.

 

(f)          Certain
Transactions and Confidentiality. Other than consummating the transactions contemplated hereunder, such Purchaser has not,
nor has any Person acting on behalf of or pursuant to any understanding with such Purchaser, directly or indirectly executed any
purchases or sales, including Short Sales, of the securities of the Company during the period commencing as of the time that
such Purchaser first received a term sheet (written or oral) from the Company or any other Person representing the Company setting
forth the material pricing terms of the transactions contemplated hereunder and ending immediately prior to the execution hereof.
Notwithstanding the foregoing, in the case of a Purchaser that is a multi-managed investment vehicle whereby separate portfolio
managers manage separate portions of such Purchaser’s assets and the portfolio managers have no direct knowledge of the investment
decisions made by the portfolio managers managing other portions of such Purchaser’s assets, the representation set forth
above shall only apply with respect to the portion of assets managed by the portfolio manager that made the investment decision
to purchase the Securities covered by this Agreement. Other than to other Persons party to this Agreement or to such Purchaser’s
representatives, including, without limitation, its officers, directors, partners, legal and other advisors, employees, agents
and Affiliates, such Purchaser has maintained the confidentiality of all disclosures made to it in connection with this transaction
(including the existence and terms of this transaction). Notwithstanding the foregoing, for the avoidance of doubt, nothing contained
herein shall constitute a representation or warranty against, or a prohibition of, any actions with respect to the borrowing of,
arrangement to borrow, identification of the availability of, and/or securing of, securities of the Company in order for such Purchaser
(or its broker or other financial representative) to effect Short Sales or similar transactions in the future.

 

(g)          Certain
Purchasers. If a Purchaser is not a U.S. resident, and the Purchaser is a resident of Canada, such Purchaser acknowledges that
in distributing the Securities to such Purchaser, the Company is relying on the exemption from the prospectus requirements under
Canadian securities laws set out in section 2.10 of National Instrument 45.106. In this regard, Purchaser confirms it is not an
individual, is purchasing as principal, the aggregate acquisition cost of purchasing the Securities will not be less than CDN$150,000
paid in cash at the time of purchase, and the Purchaser has not been created or used solely to purchase or hold the Securities
in reliance on this exemption.

 

    	 	24	 

     

    

 

The Company acknowledges and agrees that the
representations contained in this Section 3.2 shall not modify, amend or affect such Purchaser’s right to rely on the Company’s
representations and warranties contained in this Agreement or any representations and warranties contained in any other Transaction
Document or any other document or instrument executed and/or delivered in connection with this Agreement or the consummation of
the transactions contemplated hereby. Notwithstanding the foregoing, for the avoidance of doubt, nothing contained herein shall
constitute a representation or warranty, or preclude any actions, with respect to locating or borrowing shares in order to effect
Short Sales or similar transactions in the future.

 

ARTICLE IV.

OTHER AGREEMENTS OF THE PARTIES

 

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

 

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

 

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

 

    	 	25	 

     

    

 

4.4          Securities
Laws Disclosure; Publicity. The Company shall (a) by the Disclosure Time, issue a press release disclosing the material terms
of the transactions contemplated hereby, and (b) file a Current Report on Form 8-K, including the Transaction Documents as exhibits
thereto, with the Commission within the time required by the Exchange Act. From and after the issuance of such press release, the
Company represents to the Purchasers that it shall have publicly disclosed all material, non-public information delivered to any
of the Purchasers by the Company or any of its Subsidiaries, or any of their respective officers, directors, employees or agents
in connection with the transactions contemplated by the Transaction Documents. In addition, effective upon the issuance of such
press release, the Company acknowledges and agrees that any and all confidentiality or similar obligations under any agreement,
whether written or oral between the Company, any of its Subsidiaries or any of their respective officers, directors, agents, employees
or Affiliates on the one hand, and any of the Purchasers or any of their Affiliates on the other hand, shall terminate. The Company
and each Purchaser shall consult with each other in issuing any other press releases with respect to the transactions contemplated
hereby, and neither the Company nor any Purchaser shall issue any such press release nor otherwise make any such public statement
without the prior consent of the Company, with respect to any press release of any Purchaser, or without the prior consent of the
Placement Agent, with respect to any press release of the Company, which consent shall not unreasonably be withheld or delayed,
except if such disclosure is required by law, in which case the disclosing party shall promptly provide the other party with prior
notice of such public statement or communication. Notwithstanding the foregoing, the Company shall not publicly disclose the name
of any Purchaser, or include the name of any Purchaser in any filing with the Commission or any regulatory agency or Trading Market,
without the prior written consent of such Purchaser, except (a) as required by federal securities law in connection with the filing
of final Transaction Documents with the Commission and (b) to the extent such disclosure is required by state, provincial or other
applicable law or Trading Market regulations, in which case the Company shall provide the Purchasers with prior notice of such
disclosure permitted under this clause (b).

 

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

 

4.6           Non-Public
Information. Except with respect to the material terms and conditions of the transactions contemplated by the Transaction Documents,
which shall be disclosed pursuant to Section 4.4, the Company covenants and agrees that neither it, nor any other Person acting
on its behalf will provide any Purchaser or its agents or counsel with any information that constitutes, or the Company reasonably
believes constitutes, material non-public information, unless prior thereto such Purchaser shall have consented to the receipt
of such information and agreed with the Company to keep such information confidential. The Company understands and confirms that
each Purchaser shall be relying on the foregoing covenant in effecting transactions in securities of the Company. To the extent
that the Company delivers any material, non-public information to a Purchaser without such Purchaser’s consent, the Company
hereby covenants and agrees that such Purchaser shall not have any duty of confidentiality to the Company, any of its Subsidiaries,
or any of their respective officers, directors, agents, employees or Affiliates, or a duty to the Company, any of its Subsidiaries
or any of their respective officers, directors, agents, employees or Affiliates not to trade on the basis of, such material, non-public
information, provided that the Purchaser shall remain subject to applicable law. To the extent that any notice provided pursuant
to any Transaction Document constitutes, or contains, material, non-public information regarding the Company or any Subsidiaries,
the Company shall contemporaneously file such notice with the Commission on a Current Report on Form 8-K. The Company understands
and confirms that each Purchaser shall be relying on the foregoing covenant in effecting transactions in securities of the Company.

 

    	 	26	 

     

    

 

4.7          Use
of Proceeds. Except as set forth in the Preliminary Prospectus and the Prospectus, the Company shall use the net proceeds from
the sale of the Securities hereunder for working capital purposes and shall not use such proceeds: (a) for the satisfaction of
any portion of the Company’s debt (other than payment of trade payables in the ordinary course of the Company’s business
and prior practices), (b) for the redemption of any Common Shares or Common Share Equivalents, (c) for the settlement of any outstanding
litigation or (d) in violation of FCPA or OFAC regulations.

 

4.8          Indemnification
of Purchasers. Subject to the provisions of this Section 4.8, the Company will indemnify and hold each Purchaser and its directors,
officers, shareholders, members, partners, employees and agents (and any other Persons with a functionally equivalent role of a
Person holding such titles notwithstanding a lack of such title or any other title), each Person who controls such Purchaser (within
the meaning of Section 15 of the Securities Act and Section 20 of the Exchange Act), and the directors, officers, shareholders,
agents, members, partners or employees (and any other Persons with a functionally equivalent role of a Person holding such titles
notwithstanding a lack of such title or any other title) of such controlling persons (each, a “Purchaser Party”)
harmless from any and all losses, liabilities, obligations, claims, contingencies, damages, costs and expenses, including all judgments,
amounts paid in settlements, court costs and reasonable attorneys’ fees and costs of investigation that any such Purchaser
Party may suffer or incur as a result of or relating to (a) any breach of any of the representations, warranties, covenants or
agreements made by the Company in this Agreement or in the other Transaction Documents or (b) any action instituted against the
Purchaser Parties in any capacity, or any of them or their respective Affiliates, by any shareholder of the Company who is not
an Affiliate of such Purchaser Party, with respect to any of the transactions contemplated by the Transaction Documents (unless
such action is solely based upon a material breach of such Purchaser Party’s representations, warranties or covenants under
the Transaction Documents or any agreements or understandings such Purchaser Party may have with any such shareholder or any violations
by such Purchaser Party of state or federal securities laws or any conduct by such Purchaser Party which is finally judicially
determined to constitute fraud, gross negligence or willful misconduct). If any action shall be brought against any Purchaser Party
in respect of which indemnity may be sought pursuant to this Agreement, such Purchaser Party shall promptly notify the Company
in writing, and the Company shall have the right to assume the defense thereof with counsel of its own choosing reasonably acceptable
to the Purchaser Party. Any Purchaser Party shall have the right to employ separate counsel in any such action and participate
in the defense thereof, but the fees and expenses of such counsel shall be at the expense of such Purchaser Party except to the
extent that (x) the employment thereof has been specifically authorized by the Company in writing, (y) the Company has failed after
a reasonable period of time to assume such defense and to employ counsel or (z) in such action there is, in the reasonable opinion
of counsel, a material conflict on any material issue between the position of the Company and the position of such Purchaser Party,
in which case the Company shall be responsible for the reasonable fees and expenses of no more than one such separate counsel.
The Company will not be liable to any Purchaser Party under this Agreement (1) for any settlement by a Purchaser Party effected
without the Company’s prior written consent, which shall not be unreasonably withheld or delayed; or (2) to the extent, but
only to the extent that a loss, claim, damage or liability is attributable to any Purchaser Party’s breach of any of the
representations, warranties, covenants or agreements made by such Purchaser Party in this Agreement or in the other Transaction
Documents. The indemnification required by this Section 4.8 shall be made by periodic payments of the amount thereof during the
course of the investigation or defense, as and when bills are received or are incurred. The indemnity agreements contained herein
shall be in addition to any cause of action or similar right of any Purchaser Party against the Company or others and any liabilities
the Company may be subject to pursuant to law.

 

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

 

4.10        Listing
of Common Shares. The Company hereby agrees to use best efforts to maintain the listing or quotation of the Common Shares on
the Trading Market on which it is currently listed, and concurrently with the Closing, the Company shall apply to list or quote
all of the Shares and Warrant Shares on such Trading Market and promptly secure the listing of all of the Shares and Warrant Shares
on such Trading Market. The Company further agrees, if the Company applies to have the Common Shares traded on any other Trading
Market, it will then include in such application all of the Shares and Warrant Shares, and will take such other action as is necessary
to cause all of the Shares and Warrant Shares to be listed or quoted on such other Trading Market as promptly as possible. The
Company will then take all action reasonably necessary to continue the listing and trading of its Common Shares on a Trading Market
and will comply in all respects with the Company’s reporting, filing and other obligations under the bylaws or rules of the
Trading Market. The Company agrees to maintain the eligibility of the Common Shares for electronic transfer through the Depository
Trust Company or another established clearing corporation, including, without limitation, by timely payment of fees to the Depository
Trust Company or such other established clearing corporation in connection with such electronic transfer.

 

4.11        Subsequent
Equity Sales.

 

(a)          From
the date hereof until 90 days after the Closing Date, neither the Company nor any Subsidiary shall issue, enter into any agreement
to issue or announce the issuance or proposed issuance of any Common Shares or Common Share Equivalents.

 

(b)          From
the date hereof until three (3) years after the Closing Date, the Company shall be prohibited from effecting or entering into an
agreement to effect any issuance by the Company or any of its Subsidiaries of Common Shares or Common Share Equivalents (or a combination
of units thereof) involving a Variable Rate Transaction. “Variable Rate Transaction” means a transaction in which the
Company (i) issues or sells any debt or equity securities that are convertible into, exchangeable or exercisable for, or include
the right to receive additional Common Shares either (A) at a conversion price, exercise price or exchange rate or other price
that is based upon and/or varies with the trading prices of or quotations for the Common Shares at any time after the initial issuance
of such debt or equity securities, or (B) with a conversion, exercise or exchange price that is subject to being reset at some
future date after the initial issuance of such debt or equity security or upon the occurrence of specified or contingent events
directly or indirectly related to the business of the Company or the market for the Common Shares or (ii) enters into, or effects
a transaction under, any agreement, including, but not limited to, an equity line of credit, whereby the Company may issue securities
at a future determined price. Any Purchaser shall be entitled to obtain injunctive relief against the Company to preclude any such
issuance, which remedy shall be in addition to any right to collect damages.

 

    	 	28	 

     

    

 

(c)          Notwithstanding
the foregoing, this Section 4.11 shall not apply in respect of an Exempt Issuance, except that no Variable Rate Transaction shall
be an Exempt Issuance.

 

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

 

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

 

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4.14        Capital
Changes. Until the one year anniversary of the Closing Date, other than a share split or reclassification that is effected
to maintain the listing of the Common Shares on the primary Trading Market, the Company shall not undertake a reverse or forward
share split or reclassification of the Common Shares without the prior written consent of the Purchasers holding a majority in
interest of the Shares.

 

4.15        Exercise
Procedures. The form of Notice of Exercise included in the Warrants set forth the totality of the procedures required of the
Purchasers in order to exercise the Warrants. No additional legal opinion, other information or instructions shall be required
of the Purchasers to exercise their Warrants. Without limiting the preceding sentences, no ink-original Notice of Exercise shall
be required, nor shall any medallion guarantee (or other type of guarantee or notarization) of any Notice of Exercise form be required
in order to exercise the Warrants. The Company shall honor exercises of the Warrants and shall deliver Warrant Shares in accordance
with the terms, conditions and time periods set forth in the Transaction Documents.

 

ARTICLE V.

MISCELLANEOUS

 

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

 

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

 

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

 

    	 	30	 

     

    

 

5.4          Notices.
Any and all notices or other communications or deliveries required or permitted to be provided hereunder shall be in writing and
shall be deemed given and effective on the earliest of: (a) the date of transmission, if such notice or communication is delivered
via facsimile at the facsimile number or email attachment at the email address as set forth on the signature pages attached hereto
at or prior to 5:30 p.m. (New York City time) on a Trading Day, (b) the next Trading Day after the date of transmission, if such
notice or communication is delivered via facsimile at the facsimile number or email attachment at the email address as set forth
on the signature pages attached hereto on a day that is not a Trading Day or later than 5:30 p.m. (New York City time) on any Trading
Day, (c) the second (2nd)Trading Day following the date of mailing, if sent by U.S. nationally recognized overnight
courier service or (d) upon actual receipt by the party to whom such notice is required to be given. The address for such notices
and communications shall be as set forth on the signature pages attached hereto. To the extent that any notice provided pursuant
to any Transaction Document constitutes, or contains, material, non-public information regarding the Company or any Subsidiaries,
the Company shall simultaneously file such notice with the Commission in a Current Report on Form 8-K.

 

5.5          Amendments;
Waivers. No provision of this Agreement may be waived, modified, supplemented or amended except in a written instrument signed,
in the case of an amendment, by the Company and Purchasers which purchased at least 50.1% in interest of the Securities based on
the initial Subscription Amounts hereunder or, in the case of a waiver, by the party against whom enforcement of any such waived
provision is sought, provided that if any amendment, modification or waiver disproportionately and adversely impacts a Purchaser
(or group of Purchasers), the consent of such disproportionately impacted Purchaser (or group of Purchasers) shall also be required.
No waiver of any default with respect to any provision, condition or requirement of this Agreement shall be deemed to be a continuing
waiver in the future or a waiver of any subsequent default or a waiver of any other provision, condition or requirement hereof,
nor shall any delay or omission of any party to exercise any right hereunder in any manner impair the exercise of any such right.
Any proposed amendment or waiver that disproportionately, materially and adversely affects the rights and obligations of any Purchaser
relative to the comparable rights and obligations of the other Purchasers shall require the prior written consent of such adversely
affected Purchaser. Any amendment effected in accordance with this Section 5.5 shall be binding upon each Purchaser and holder
of Securities and the Company.

 

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

 

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

 

5.8          No
Third-Party Beneficiaries. The Placement Agent shall be the third party beneficiary of the representations and warranties of
the Company in Section 3.1 and the representations and warranties of the Purchasers in Section 3.2. This Agreement is intended
for the benefit of the parties hereto and their respective successors and permitted assigns and is not for the benefit of, nor
may any provision hereof be enforced by, any other Person, except as otherwise set forth in Section 4.8 and this Section 5.8.

 

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

 

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

 

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

 

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

 

    	 	32	 

     

    

 

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

 

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

 

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

 

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

 

    	 	33	 

     

    

 

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

 

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

 

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

 

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

 

    	 	34	 

     

    

 

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

 

(Signature Pages Follow)

 

    	 	35	 

     

    

 

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

 

	Stellar Biotechnologies, Inc.	 	
        Address for Notice:

        332. E. Scott Street

        Port Hueneme, CA 93041

        Attention: Kathi Niffenegger

        Fax: 805-488-2889

	By:	 	 	Email: ir@stellarbiotech.com AND
	 	
        Name: Kathi Niffenegger

        Title: CFO
	 	warrantexercise@stellarbiotech.com

 

With a copy to (which shall not constitute notice):

 

Greenberg Traurig, LLP

1840 Century Park East, Suite 1900

Los Angeles, CA 90067

Attention: Barbara A. Jones, Esq.

 

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK

SIGNATURE PAGE FOR PURCHASER FOLLOWS]

 

    	 	36	 

     

    

 

[PURCHASER SIGNATURE PAGES TO SBOT
SECURITIES PURCHASE AGREEMENT]

 

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

 

Name of Purchaser: ______________________________________________________

 

Signature of Authorized Signatory of Purchaser:
_________________________________

 

Name of Authorized Signatory: _______________________________________________

 

Title of Authorized Signatory: ________________________________________________

 

Email Address of Authorized Signatory:_________________________________________

 

Facsimile Number of Authorized Signatory: __________________________________________

 

Address for Notice to Purchaser:

 

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

 

DWAC for Shares:

 

Common Unit Subscription Amount: $___________________

 

Common Units:_________________________

 

Shares: _______________________________

 

Common Warrant Shares: ________________

 

Pre-Funded Unit Subscription Amount: _________________

 

Pre-Funded Units:_______________________

 

Pre-Funded Warrant Shares: ______________

 

Common Warrant Shares: ________________

 

EIN Number: ____________________

 

    	 	37	 

     

    

 

 ̈  Notwithstanding
anything contained in this Agreement to the contrary, by checking this box (i) the obligations of the above-signed to purchase
the securities set forth in this Agreement to be purchased from the Company by the above-signed, and the obligations of the Company
to sell such securities to the above-signed, shall be unconditional and all conditions to Closing shall be disregarded, (ii) the
Closing shall occur by the second (2nd) Trading Day following the date of this Agreement and (iii) any condition to Closing contemplated
by this Agreement (but prior to being disregarded by clause (i) above) that required delivery by the Company or the above-signed
of any agreement, instrument, certificate or the like or purchase price (as applicable) shall no longer be a condition and shall
instead be an unconditional obligation of the Company or the above-signed (as applicable) to deliver such agreement, instrument,
certificate or the like or purchase price (as applicable) to such other party on the Closing Date.

 

[SIGNATURE PAGES CONTINUE]

 

    	 	38Exhibit 4.17

 

SHARE
EXCHANGE AGREEMENT

 

THIS SHARE EXCHANGE AGREEMENT is made and
entered into as of December 3, 2017, by and among PV Nano Cell Ltd., an Israeli Company (the “Purchaser”), Digiflex
Ltd., an Israeli company (the “Company”), the stockholders of the Company as set forth on the signature pages
to this Agreement (collectively, the “Stockholders” and, individually, a “Stockholder” and
together with the Company “Seller Parties”) and Moshe Zimmerman as Stockholder Representative (the “Stockholder
Representative”).

 

Recitals

 

Whereas, the Stockholders, representing
the entire share capital of the Company on a fully diluted basis, desire to sell to and exchange with the Purchaser all of the
securities of the Company that they hold for securities of the Purchaser as set forth herein (the transactions set forth herein,
the “Transactions”);

 

Whereas, concurrently with the execution
and delivery of this Agreement, and as a condition and inducement to the Purchaser’s willingness to enter into this Agreement,
the Stockholders listed on Schedule A and Jet CU P.C.B Ltd (“Jet CU”) shall invest in the Purchaser an
aggregate amount of US $ 1,100,000 under the terms of the Share Purchase Agreement attached hereto as Schedule B (the “Investment
Transaction” “SPA” respectively), and as a condition to the Transactions under this Agreement, out of
which an amount of US $56,344 was already advanced to the Company and shall be part of the Investment Transaction. The investment
amount will be transferred by the applicable Stockholders to a trustee prior to the Closing and will be transferred to the Purchaser
as detailed below.

 

Whereas. all capitalized terms used
in this Agreement but not otherwise defined in this Agreement shall have the meanings set forth in EXHIBIT 1 hereto.

 

Now, Therefore, in consideration
of the respective covenants, agreements and representations and warranties set forth in this Agreement, the parties to this Agreement,
intending to be legally bound, agree as follows:

 

ARTICLE I DESCRIPTION OF TRANSACTION

 

Section 1.1 Exchange of Shares and Investment Transaction

 

(a)
Subject to the terms and conditions in this Agreement, at the Closing, each Stockholder agrees
to sell, transfer, assign and deliver to the Purchaser such number of (i) Ordinary Shares of the Company, par value NIS 0.01 per
share (“Shares”) and (ii) Preferred A Shares, Preferred B Shares and Preferred C Shares of the Company, par
value NIS 0.01 per share (“Preferred A Shares”, “Preferred B Shares” and “Preferred
C Shares” and, together with the Ordinary Shares, the “Shares”), set forth opposite its name on Schedule
C, together with any additional Shares which may be issued to a Stockholder after the date hereof, but prior to Closing, as
a result of the conversion of any Company Notes and the exercise of any Company Options or Company Warrants, free and clear of
all Liens, and the Purchaser agrees to sell and issue to all such Stockholders, as applicable, in exchange for the Shares, such
number of shares of common stock, par value NIS 0.01 per share of the Purchaser representing in the aggregate 25% of the share
capital of the Purchaser on a fully diluted basis at closing, free and clear of all Liens (the “Purchaser Common Stock”)
in accordance with the conversion rate and the agreed valuation described in Schedule C (“Agreed Value”) and
as set forth opposite each Stockholder’s name on Schedule C.

 

    	 	-1-	 

     

    

 

(b) Transfer Restrictions. The Purchaser
Common Stock may only be disposed of in compliance with state and federal securities laws. In connection with any transfer of Purchaser’s
shares other than pursuant to an effective registration statement or Rule 144, to the Purchaser or to an Affiliate of a Stockholder
or in connection with a pledge, the Purchaser may require the transferor thereof to provide, at the transferor’s expense, an opinion
of counsel selected by the transferor and reasonably acceptable to the Purchaser, the form and substance of which opinion shall
be reasonably satisfactory to the Purchaser, to the effect that such transfer does not require registration of such transferred
shares under the Securities Act. As a condition of transfer, any such transferee shall agree in writing to be bound by the terms
of this Agreement and shall have the rights and obligations of a Stockholder under this Agreement and the other Ancillary Agreements.

 

(c) The investment amount under the Investment
Transaction will be transferred to Purchaser as follows:

 

An amount of US $443,656 shall be transferred
to the Purchaser at the Closing and US $56,344 was already advanced to the Company, totaling US $500,000 (“First Payment”);

 

An amount of USD 600,000 shall be transferred
to the Purchaser by Jet CU no later than December 30 2017 (“Second Payment”).

 

(d) The Stockholders who are shareholders
or office holders in Jet CU (“Affiliated Stockholders”) shall cause Jet CU to perform under the SPA. Failure by
Jet CU to pay the Second Payment by December 30 2017 which is not cured by January 30, 2018, shall results in, without derogating
from any other remedy available to the Purchaser under this Agreement, the forfeiture of all the shares issued to the Affiliated
Stockholders in the Investment Transaction and in addition forfeiture of 400,000 Purchaser Common Stock issued to the Affiliated
Stockholders in connection with the Share exchange, in accordance with the allocation described in Schedule A or in accordance
with the written instructions signed by all the Affiliated Stockholders. The Purchaser shares issued to the Affiliated Stockholders
under the SPA of the Investment Transaction, shall be deposited with the Paying Agent in escrow until the Second Payment is made
by Jet CU. The provisions of the Escrow Agreement shall apply also to the release of the Purchaser Units (as defined in the SPA|)
issued to the Affiliated Stockholders under the SPA. The terms of subsections (c) and (d) of this Section 1.1 shall prevail any
contradicting terms of the SPA.

 

Section 1.2 Conversion of Company Notes

 

(a)
Subject to the terms and conditions in this Agreement, effective as of the Closing, all outstanding Indebtedness of the
Company under the Company’s outstanding convertible notes (the “Company Notes”) shall be converted into
Shares in accordance with their terms. If such Company Notes have not been converted as of the date of the Closing, such Company
Note shall be deemed automatically cancelled and forfeited, effective immediately prior to the Closing. As a result of such conversion
or forfeiture, each Company Note holder will be the holder of that number of Shares set forth opposite such Company Notes holder’s
name on Schedule C hereto which shall be updated prior to the Closing, as of immediately prior to the Closing, and such
shares will be exchanged pursuant to the Transactions, as described in Section 1.1(a) above. The Company Notes will be cancelled
after such conversion.

 

    	 	-2-	 

     

    

 

Section 1.3 Assumption and Substitution of Company Options
and Exercise of Warrants.

 

(a) Subject to the terms and conditions
in this Agreement, effective as of the Closing, all the issued, outstanding and unexercised options (the “Company Options”)
to purchase or otherwise receive Ordinary Shares of the Company that were granted under the Company’s 2010 Employee Share Option
Plan (the “Company Option Plan”) that are held individually or by the trustee of the Company Option Plan (the
“Trustee”) for the benefit of certain individuals, in each case as set forth on Schedule D hereto (the
“Company Option Holders”), which represents all of the outstanding Company Options whether vested or unvested,
shall be assumed and substituted by the Purchaser for the number of options to acquire shares of Purchaser Common Stock set forth
opposite such Company Option Holder’s name on Schedule D hereto (each a “Replacement Option”). Each
Company Option so assumed and substituted by the Purchaser pursuant to this Section 1.3(a) shall continue to have the same expiration
date, vesting schedule and aggregate exercise price as in effect immediately prior to the Closing; provided that (x) such
Replacement Option shall be exercisable for that number of whole shares of Purchaser Common Stock set forth opposite such Company
Option Holder’s name set forth on Schedule D hereto and (y) the per share exercise price for the shares of Purchaser
Common Stock issuable upon exercise of such substituted Company Option shall be as set forth opposite such Company Option Holder’s
name set forth on Schedule D hereto. The Replacement Options shall be governed by the Purchaser’s 2010 Option Plan and individual
option grant agreements or other similar agreements. The Company shall obtain the consent of the Company Option Holders to the
replacement of their Company Options, in the form attached hereto as Schedule E including their confirmation that they understand
that there is no guarantee that the Replacement Options shall enjoy a preferred tax arrangement and that neither the Purchaser
nor the Company are obligated towards the Option Holders to apply for any tax ruling.

 

(b) Subject to the terms and conditions
in this Agreement, each Person who holds warrants (each a “Company Warrant Holder”) to purchase or otherwise
acquire Shares of the Company, as set forth on Schedule C hereto, which represents all of the outstanding warrants to purchase
or otherwise acquire Ordinary Shares of the Company, (the “Company Warrants”) whether vested or unvested and
that are unexercised as of the date of this Agreement, hereby agrees and acknowledges that (i) prior to the Closing such Company
Warrant Holder will exercise their Company Warrants in accordance with the exercise procedures set forth in the Company Warrants,
and (ii) that if such Company Warrant has not been exercised as of the date of the Closing, such Company Warrant shall be deemed
automatically forfeited and cancelled, effective immediately prior to the Closing. As a result of such exercise or forfeiture,
each Company Warrant Holder will be the holder of that number of Shares set forth opposite such Company Warrant Holder’s
name on Schedule C hereto as updated immediately prior to the Closing, and such shares will be exchanged pursuant to the
Transactions, as described in Section 1.1(a) above. The Stockholder Representative and the Company shall determine the final Schedule
C, and all Stockholders agree that their determination shall be binding and final.

 

    	 	-3-	 

     

    

 

Section
1.4 Withholding. The Stockholders shall be responsible for the payment of any and all Taxes levied on account of the Purchaser
Common Stock issued to Stockholders by Purchaser under this Agreement. Stockholders shall obtain an unequivocal approval or certification
from the applicable taxing authorities evidencing the payment of the applicable Taxes or an exemption from such withholding. The
provisions of the Paying Agent Agreement shall apply to withholding of any Taxes due by the Stockholders. Each Stockholder confirms
that he/she/it understands that failure to provide a withholding certificate shall impose tax liability according to the ITO and
to the extent that such Stockholder did not wire the cash amount covering the applicable Tax to the Paying Agent when due, the
certificate(s) representing the Shares will be returned to Purchaser, and the Purchaser shall hold them in accordance with the
applicable terms of the Paying Agent Agreement, mutatis mutandis. By signing this Agreement, each Stockholder hereby agrees to
be included in the Tax Ruling and to comply with its terms, to the extent submitted by the Company, and to sign each and any document
required for that purpose.

 

ARTICLE II

 

REPRESENTATIONS AND WARRANTIES OF THE STOCKHOLDERS

 

Each Stockholder hereby represents and
warrants to the Purchaser, severally and not jointly, as of the date hereof and as of the Closing Date, all the representations
and warranties contained in Exhibit 2 attached hereto. Such representations and warranties are subject to the qualifications
and exceptions set forth in the applicable schedules referred to herein. References to the knowledge or awareness of each of Stockholder
are deemed to include the actual knowledge or awareness of such Stockholder and any knowledge that such Stockholder should have
obtained after reasonable inquiry taking into consideration his involvement with the Company and its Affiliates, provided however
that with respect to representation regarding the Company and its Affiliates, such references are deemed to also include the
best knowledge or awareness of any of the Company’s and its Affiliates officers and any knowledge that such officer should have
obtained after reasonable inquiry in the course of the performance of his/her respective duties on behalf of the Company and its
Affiliates. The term Company is this Section shall also refer to the Company’s Affiliates.

 

ARTICLE III

 

REPRESENTATIONS AND WARRANTIES OF THE PURCHASER

 

The Purchaser represents and warrants to
the Seller Parties that each statement contained in Exhibit 3 attached hereto is true and correct as of the date hereof
and as of the Closing Date. Such representations and warranties are subject to the qualifications and exceptions set forth in the
applicable schedules referred to in Exhibit 3. References to the knowledge or awareness of each the Purchaser is deemed
to include the actual knowledge or awareness of the Purchaser’s CEO and any knowledge that the CEO should have obtained after reasonable
inquiry in the course of the performance of his respective duties on behalf of the Company and its Affiliates.

 

    	 	-4-	 

     

    

 

ARTICLE IV

 

CERTAIN COVENANTS AND AGREEMENTS

 

Section 4.1 Conduct of Business Pending
Closing. From the date hereof until the Closing, the Company will:

 

(a) maintain its existence in good standing;

 

(b) maintain the general character of its
business and properties and conduct its business in the Ordinary Course of Business, except as otherwise expressly permitted by
this Agreement;

 

(c) maintain its business and accounting
records consistent with past practices;

 

(d) the Company will file on a timely basis
with the appropriate taxing authorities all tax returns required to be filed, and pay all Taxes due, before the Closing Date; and

 

(e) use commercially reasonable efforts
to (i) preserve its business intact, and (ii) keep available to the Company the services of its present officers and employees.

 

(f) with respect to any Company Option
Holder who exercises their option to acquire Ordinary Shares, for purposes of the Transactions described herein, (i) treat such
Company Option Holder as a Stockholder, (ii) treat any shares issued pursuant to the exercise of such Company Options as Ordinary
Shares, and (iii) have such Company Option Holder sign an addendum to this Agreement, joining this Agreement as a Stockholder with
respect to the Ordinary Shares acquired by such Option Holder upon exercise of their Company Option.

 

(g) Convert and Exercise all Company Notes
and Company Warrants, as further described in Sections 1.2 and 1.3 above.

 

(h) Obtain the approval of the Purchaser’s
auditors to the audited financial statements of the Company as and for the period ended December 31, 2015 and December 31, 2016
and unaudited financial statements as and for the period ended September 30, 2017 (the “Financial Statements”),
in accordance with United States generally accepted accounting principles;

 

Section 4.2 Prohibited Actions Pending
Closing. Unless otherwise expressly permitted herein or approved by the Purchaser or the Company in writing, as applicable,
from the date hereof until the Closing, neither the Company nor the Purchaser shall:

 

(a) allow any Material Change to its business;

 

(b) enter into or amend a material contracts or transactions
or agreements;

 

(c) make
or commit to any significant liaberilities or other commitments, not in
the ordinary course of business;

 

    	 	-5-	 

     

    

 

(d) acquire, sell, assign, encumber or otherwise dispose any
material assets;

 

(e) alter or agree to alter its incorporation documents;

 

(f) declare, set aside or pay any dividend
or other distribution in respect of any shares of capital stock or repurchase, redeem or acquire any outstanding shares of capital
stock or other securities of, or other ownership interest in;

 

(g) change accounting or tax reporting
principles, methods or policies;

 

(h) make, change or rescind any material
election concerning Taxes or tax returns, file any amended tax return, enter into any closing agreement with respect to Taxes,
settle or compromise any material Tax claim or assessment or surrender any right to claim a refund of Taxes or obtain any tax ruling;

 

(i) cause to occur, by act or omission,
an event or series of event, whether related or not, which may have, from the perspective of the other party, a Material Adverse
Effect on the business, assets or financial condition of the other party or on the transactions contemplated by this Agreement;

 

(j) make or commit to make any capital expenditures or capital
additions or betterments in excess of $10,000 individually or $40,000 in the aggregate except that the Purchaser shall not be subject
to such limitation with respect to ordinary course expenditures;

 

(k) (i) mortgage, pledge or subject to
any lien any of its assets, or (ii) acquire any assets or sell, assign, transfer, convey, lease or otherwise dispose of any assets
of the Company, except in the case of clause (ii), in the Ordinary Course of Business;

 

(l) make any loans or capital contributions
to, or investments in, any Person or pay any fees to any director, officer, partner or Affiliate thereof or to any Company Stockholder
(who is not a director, officer or partner) or Affiliate of any Company Stockholder (other than business expenses incurred in the
Ordinary Course of Business);

 

(m) institute or settle any legal proceeding;
and

 

(n) agree, commit, arrange or enter into
any understanding to do anything set forth in this Section 4.2.

 

(o) Without derogating from the above,

 

(i) the Purchaser shall not be precluded
from completing the following transactions which are currently contemplated: financing transaction through equity/debt/convertible
loan not to exceed USD $2,000,000, purchase additional printers and establish of new joint venture in China. Purchaser may also
continue to raise equity investments in the framework of the Private Placement Offering as described in the F-20 submitted by Purchaser
to the SEC.

 

(ii) the
Purchaser, the Company and the Stockholders shall not be precluded from any action or activity that is required or advisable for
the fulfillment or the performance of the Purchaser, the Stockholders’ and/or Company’s obligations under this Agreement.

 

    	 	-6-	 

     

    

 

Section 4.3 Access to Information.
The Company shall cause its officers, directors, employees and agents to, afford the officers, employees and agents of the Purchaser
complete access at all reasonable times, from the date hereof to the Closing, to its officers, employees, agents, properties, books
and records, and shall furnish Purchaser all financial, technical, operating and other data and information as Purchaser, through
its officers, employees or agents, may reasonably request. The information shall include the delivery of complete formulas of the
Company’s inks and other products sold by the Company, at least two weeks before Closing. Purchaser shall keep all information
discovered in the course of such investigation confidential.

 

Section 4.4 Reasonable Efforts to Close.
Subject to the terms and conditions provided in this Agreement, each of the parties hereto shall use reasonable best efforts to
take promptly, or cause to be taken promptly, all actions, and to do promptly, or cause to be done promptly, all things necessary,
proper or advisable under applicable Law to consummate and make effective the Transactions and the other transactions contemplated
hereby as promptly as practicable, including by using commercially reasonable efforts to take all action necessary to satisfy all
of the conditions to the obligations of the other party or parties hereto to effect the Transactions, to obtain all necessary waivers,
consents, approvals and other documents required to be delivered hereunder and to effect all necessary registrations and filings
and to remove any injunctions or other impediments or delays, legal or otherwise, in each case in order to consummate and make
effective the Transactions and the other transactions contemplated by this Agreement for the purpose of securing to the parties
hereto the benefits contemplated by this Agreement.

 

Section 4.5 Cooperation on Tax Matters.

 

(i) The parties hereto shall cooperate
fully, as and to the extent reasonably requested by the other party, in connection with the filing of tax returns related to the
Transaction and any audit or legal proceeding with respect to Taxes. Such cooperation shall include the retention and (upon the
other party’s request) the provision of records and information which are reasonably relevant to any such audit or legal
proceeding and making employees available on a mutually convenient basis to provide additional information and explanation of any
material provided hereunder.

 

(ii) Stockholder Representative, on behalf
of the Stockholders, further agree, upon request, to use its respective best efforts to obtain any certificate or other document
from any taxing authority or any other Person as may be necessary to mitigate, reduce, or eliminate any tax that could be imposed
(including, but not limited to, with respect to the transactions contemplated hereby).

 

(iii) The Stockholders shall obtain no
later than 180 days of the Closing the following tax rulings from the Israel Tax Authority: ruling regarding the exchange of the
options of the Option Holders (“Tax Ruling”).

 

(iv) Survival of Obligations. Notwithstanding
any other provision in this Agreement to the contrary, the obligations of the parties set forth in this Section 4.5 shall
be unconditional and absolute and shall remain in effect without limitation as to time or amount.

 

    	 	-7-	 

     

    

 

Section
4.6 Publicity. No party to this Agreement shall directly or indirectly make any public announcement or statement regarding
this Agreement, the Ancillary Agreements or the transactions contemplated hereby or thereby without the prior consent of Purchaser
and the Company, such consent not to be unreasonably withheld. No consent shall be required if such announcement is required by
Law or the rules or regulations of any United States or foreign securities exchange or automated quotation system.

 

Section 4.7 Confidentiality. Each
of the Stockholders and Purchaser shall (and shall cause each of its respective representatives to) maintain in confidence and
not directly or indirectly, use, disseminate, disclose or publish, or use for such Stockholder’s or Purchaser’s benefit
or the benefit of any person, firm, corporation or other entity any Confidential Information of the other Parties, or deliver to
any person, firm, corporation or other entity any document, record, notebook, computer program or similar repository of or containing
any such Confidential Information. Each of the Stockholders and Purchaser hereby stipulate and agree that as between them, the
Confidential Information is important, material and affects the successful conduct of the business of the Company as currently
conducted and as contemplated to be conducted by the Company following the consummation of the transactions contemplated by this
Agreement and the Ancillary Agreements. After the Closing the Confidential Information of the Company shall be deemed Confidential
Information of the Purchaser.

 

Section 4.8 Appointment of Directors and Officers of the
Purchaser.

 

(a)
As soon as possible post Closing, the Purchaser shall bring to the vote of the General Meeting the nomination of Mr.
Shai Levy to the Board of Directors (the “Purchaser Director”) and shall take such other action as is necessary
to accomplish the foregoing. The appointment is conditioned upon the Purchaser Director meeting the qualification requirements
under applicable Law and signing any documents reasonably required by the Purchaser to comply with applicable Law.

 

Section 4.9 Further Assurances.
From time to time, as and when requested by any Party, each Party shall execute and deliver, or cause to be executed and delivered,
all such documents and instruments and shall take, or cause to be taken, all such further or other actions, as such other Party
may reasonably deem necessary or desirable to consummate the transactions contemplated by this Agreement.

 

ARTICLE V CONDITIONS TO CLOSING

 

Section 5.1 Conditions Precedent to
Each Party’s Obligation to Effect the Transactions. The respective obligations of each party hereto to effect the Transactions
shall be subject to the fulfillment or satisfaction, prior to or on the Closing Date of the following conditions:

 

(a) Completion of the Financing Round.
On or before the Closing Date, Purchaser shall have raised an equity investment of at least US $1,400,000 including the amount
to be invested by certain Stockholders under the Investment Transaction.

 

(b) No Legal Impediments. As of
the Closing Date, there shall not be any Legal Proceeding by any Governmental Body before any court or Governmental Body seeking
to restrain or prohibit the consummation of this Agreement or any of the other transactions contemplated by this Agreement.

 

    	 	-8-	 

     

    

 

(c) Other Consents. On or before
the Closing Date, Purchaser and the Company have each obtained and delivered, as applicable, all necessary board, shareholder and
third party consents required to adopt and approve this Agreement and to consummate the Transactions or the other transaction contemplated
hereby.

 

(d) Completion of Due Diligence.
Each of Purchaser and the Company, in its reasonable discretion, shall have completed to its satisfaction all necessary technical,
financial and legal due diligence including the review of the Company’s inks formulas and products.

 

Section 5.2
Conditions Precedent to Obligations of the Purchaser. All obligations of the Purchaser under this Agreement are further
subject to the fulfillment, satisfaction or (to the extent permitted by Law) waiver by the Purchaser, prior to or on the Closing
Date, of each of the following conditions precedent:

 

(a) Representations and Warranties.
Each of the Company’s and the Stockholders’ representations and warranties contained in Exhibit 2 of this Agreement
shall be true and correct in all material respects on and as of the Closing Date with the same effect as though such representations
and warranties were made on and as of the Closing Date, except to the extent that any representations and warranties expressly
relate to an earlier date, in which case such representations and warranties shall be evaluated as of such earlier date.

 

(b) Covenants. The Company and the
Stockholders shall have performed and complied in all material respects with all covenants and obligations under this Agreement
required to be performed and complied with by the Company and the Stockholders prior to the Closing.

 

(c) Officer’s
Certificate. Purchaser shall have received a certificate from the Company, validly executed by the Chairman of the Company’s
Board for and on the Company’s behalf, to the effect that, as of the Closing the conditions with respect to the Company set forth
in Sections 5.1 (b), 5.1 (c), 5.2(a) and 5.2(b)
have been satisfied in the form attached hereto as Schedule 5.2(c).

 

(d) No Material Liabilities. Purchaser
shall have received a certificate from the Company, validly executed by the Company’s Chairman of the Board that as of the Closing
Date, the Company’s Liabilities do not exceed One Million sixty five thousand ($1,065,000) (excluding the Liabilities to the OCS)
in the form of accounts payable, notes payable and accrued expenses (not including allowance for vacation), including the legal
and accounting expenses in connection with the Transactions and that the Company has a cash balance of US 200,000 as of the Closing.
The Company shall not be a party to or bound by any instrument or agreement relating to any material indebtedness that would limit
the issuance or cancellation of any securities pursuant to this Agreement.

 

(e) Amendment of the Jet CU License
Agreement. Purchaser shall have received executed copies of the License Agreement in the form attached hereto as Schedule
5.2(e).

 

(f) Service Agreement with Jet CU.
Company and Jet CU shall have executed the Service Agreement in the form attached hereto as Schedule 5.2(f).

 

    	 	-9-	 

     

    

 

(g) Share
Transfer Deeds and Share Certificates. The Purchaser shall have received all physical original certificates evidencing all
securities of the Company held by the Stockholders or an affidavit of lost, stolen or destroyed certificate, and a share transfer
deed, both in form attached hereto as Schedule 5.2(g), appropriately completed and signed.

 

(h) Approval of Financial Statements.
The Purchaser shall have received the Financial Statements approved by the Purchaser’s auditors as set forth in Section 4.1(i)
above.

 

(i) No Material Adverse Effect on the
Company. As of the Closing Date, there shall not have occurred any event and no circumstance shall exist which, alone or together
with any one or more other events or circumstances has had, is having or would reasonably be expected to have a Material Adverse
Effect on the Company.

 

(j) Accredited Investor Questionnaire.
The Purchaser shall have received an accredited investor questionnaire, in form reasonably satisfactory to the Purchaser, executed
by each Stockholder that is an “accredited investor” as defined in Rule 501(a) of Regulation D promulgated under the
Securities Act in the form attached hereto as Schedule 5.2(j).

 

(k) Regulation S Certification.
The Purchaser shall have received a Regulation S Certification, in the form and substance of the certificate annexed hereto as
Schedule 5.2(k), executed by each Stockholder that is not a U.S. Person and is not an “accredited investor” as defined
in Rule 501(a) of Regulation D promulgated under the Securities Act.

 

(l) Closing of the Investment Transaction.
The closing of the Investment Transaction has occurred in accordance with the SPA, and the Purchaser shall have received the Purchase
Price due at such closing, as detailed in the SPA and in Section 1.1 (c) above.

 

(m) The Purchaser shall receive executed
resignation letters of all the members of the Board of the Company and its subsidiaries, attached hereto as Schedule 5.2(m).

 

(n) Company
Investment. Certain
Stockholders of the Company have invested in the equity of the Company an amount of $200,000, immediately prior to the Closing,
and that the Company shares issued to them in respect of such investment are described on Schedule C.

 

Section 5.3 Conditions Precedent to
the Company’s and the Stockholder’s Obligations. All obligations of the Company and the Stockholders under this Agreement
are further subject to the fulfillment, satisfaction, or (to the extent permitted by Law) waiver by the Company and the Stockholders
prior to or on the Closing Date, of each of the following conditions precedent:

 

(a)
Representations and Warranties. The Purchaser’s representations and warranties contained in Exhibit 3 of this
Agreement shall be true and correct in all respects on and as of the Closing with the same effect as though such representations
and warranties were made on and as of the Closing, except to the extent that any representations and warranties expressly relate
to an earlier date, in which case such representations and warranties shall be evaluated as of such earlier date.

 

    	 	-10-	 

     

    

 

 

(b) Covenants. The Purchaser shall
have performed and complied in all material respects with all covenants and obligations under this Agreement required to be performed
and complied with by the Company prior to the Closing.

 

(c) Officer’s Certificate. The Company
shall have received a certificate from the Purchaser, validly executed by the Chief Executive Officer of Purchaser for and on the
Purchaser’s behalf, to the effect that, as of the Closing the conditions set forth in Sections 5.3(a) and 5.3(b),
have been satisfied.

 

Section 5.4 Frustration of Closing Conditions.
None of the Company, Purchaser or the Stockholder Representative may rely on the failure of any condition set forth in Sections
5.1, 5.2 or 5.3, as the case may be, to be satisfied if such failure was caused by such party’s failure to
use reasonable best efforts to consummate the Transactions and the other transactions contemplated by this Agreement, as required
by and subject to Section 5.4.

 

ARTICLE VI CLOSING

 

Section 6.1 Closing. Unless otherwise
mutually agreed between the Purchaser, the Company and the Stockholders’ Representative, the Closing shall take place at
the offices of Primes, Shiloh, Givon, Meir - Law Firm, 16 Derech Hayam St., Haifa 3474110, Israel, on the 2nd Business Day following
the day on which the last to be satisfied or waived of the conditions set forth in ARTICLE V and ARTICLE VI shall be satisfied
or waived in accordance with this Agreement (other than those conditions that by their terms are to be satisfied at the Closing,
it being understood that the occurrence of the Closing shall remain subject to the satisfaction or waiver of such conditions at
the Closing). The date on which the Closing actually takes place is referred to in this Agreement as the “Closing Date”.

 

Section 6.2 Stockholder and Company
Closing Deliveries. At the Closing, the Stockholders and the Company, as applicable, shall deliver, or cause to be delivered,
to the Purchaser, the deliverables, agreements and documents required pursuant to Section 5.2, each of which shall be in full force
and effect.

 

Section 6.3 Purchaser Closing Deliveries.
At the Closing, the Purchaser shall deliver, or cause to be delivered, to the Company or the Stockholders’ Representative,
as applicable, the deliverables, agreements and documents required by Section 5.3, each of which shall be in full force and effect.

 

Section 6.4 Post Closing Actions.

 

(i) Transfer Agent. The Company shall issue irrevocable instructions
to its transfer agent to issue share certificates representing the Shares to the Escrow Agent and to the Paying Agent on behalf
of each Stockholder.

 

(ii) Tax Ruling. The Stockholders shall apply and obtain the
Tax Ruling from the ITA with respect to the exchange of the Options.

 

    	 	-11-	 

     

    

 

ARTICLE VII
TERMINATION

 

Section 7.1 Termination Events.

 

(a)
This Agreement may be terminated prior to the Closing:

 

(i) by mutual written consent of the Purchaser,
the Company and the Stockholders’ Representative;

 

(ii) by written notice from the Purchaser
to the Company and the Stockholders’ Representative, if there has been a breach of any representation, warranty, covenant
or agreement by the Company or the Stockholders, or any such representation or warranty shall become untrue after the date of this
Agreement, such that the conditions in Section 5.1 or Section 5.2 would not be satisfied and such breach is not curable or, if
curable, is not cured within the earlier of (A) twenty (21) days after written notice thereof is given by the Purchaser to the
Company and the Stockholders’ Representative, and (B) the Expiration Date;

 

(iii) by written notice from the Stockholders’
Representative to the Purchaser, if there has been a breach of any representation, warranty, covenant or agreement by the Purchaser,
or any such representation or warranty shall become untrue after the date of this Agreement, such that the conditions in Section
5.1 or Section 5.3 would not be satisfied and such breach is not curable or, if curable, is not cured within the earlier of (A)
ten (10) days after written notice thereof is given by the Stockholders’ Representative to the Purchaser, and (B) the Expiration
Date; or

 

(iv) by five (5) days’ prior written
notice by the Stockholders’ Representative to the Purchaser or the Purchaser to the Company and the Stockholders’ Representative,
as the case may be, in the event the Closing has not occurred on or prior to December 31, 2017 (the “Expiration Date”)
for any reason other than delay or nonperformance of or breach by the party seeking such termination; provided that the
parties may mutually agree, in writing, to extend the Expiration Date.

 

(b) In
the event of termination of this Agreement pursuant to this ARTICLE VIII, this Agreement shall forthwith become void and
there shall be no liability on the part of any party to this Agreement or its partners, officers, directors,
stockholders, members or other equity holders, except for obligations under Section 4.7 (Confidentiality), Section 10.3 (Fees
and Expenses), Section 10.4 (Waiver; Amendment), Section 10.5 (Entire Agreement), Section 10.6 (Execution of Agreement;
Counterparts; Electronic Signatures), Section 10.7 (Governing Law; Venue), Section 10.8 (Attorneys’ Fees), Section 10.9
(Assignment and Successors), Section 10.11 (Notices), Section 10.12 (Severability), Section 10.13 (Schedules and Exhibits)
and this Section and the definitions used in each of the foregoing sections, including those set forth in Exhibit
1 hereto, all of which shall survive such termination and the Termination Date. In addition, within two (2) days of
the termination date, the Company shall return the Purchaser the loan amount provided to the Company by Purchaser, in a
principal amount of US $96,295together with any accrued interest. Notwithstanding the foregoing, nothing contained in this
Agreement shall relieve any party from liability for any breach of this Agreement.

 

    	 	-12-	 

     

    

 

ARTICLE VIII INDEMNIFICATION

 

Section 8.1 Survival of Representations
and Warranties. The representations and warranties provided for in this Agreement shall survive the Closing.

 

Section 8.2 Indemnification.

 

(a) Each Stockholder, severally and not
jointly, shall indemnify and hold harmless the Purchaser and its Affiliates, against and in respect of any and all claims, costs,
expenses, direct damages, losses, including, without limitation, reasonable attorney fees paid for to any suit, action or proceeding
of the above, but excluding any indirect or contingent damages or losses (the “Damages”) resulting from (i)
any inaccuracy in any representation or the breach of any warranty made by such Stockholder in this Agreement; (ii) the breach
by any Stockholder or the Company until the Closing of any covenant or agreement to be performed hereunder; (iii) any fees, expenses
or other payments incurred or owed by the Seller Parties to any agent, broker, investment banker or other firm or Person retained
or employed by it in connection with the transactions contemplated by this Agreement or the Ancillary Agreements; (iv) any Indebtedness
of the Company; (v) any and all Taxes of the Company or its Affiliates (or the non-payment thereof), including any and all Taxes
of any Person (other than the Company or its Affiliates) imposed on the Company, its Affiliates or any other Indemnified Persons
as a transferee, successor, by contract, agreement or other arrangement, pursuant to any Law or otherwise for the period prior
to the Closing or payable in connection with or as a result of the Transaction; (vi) failure to obtain Governmental Authorizations;
(vii) only with respect to the Affiliated Stockholders, failure of Jet CU to pay the Second Payment; and (vii) any Liabilities.

 

(b) No Indemnification by the Company.
The Stockholders acknowledge and agree that, upon and following the Closing: (i) the Company shall not have any liability or obligation
to indemnify, save or hold harmless or otherwise pay, reimburse or make Stockholders whole for or on account of any indemnification
or other claims made by any Purchaser Indemnitee hereunder; (ii) the Stockholder shall have no right of contribution against the
Company with respect to any such indemnification or other claim. By signing this Agreement each Stockholder confirms that effective
as of Closing it/he/she irrevocably waives and releases the Company and its Affiliates from any and all claims it may have against
the Company for any reason whatsoever.

 

(c) The Purchaser shall indemnify and hold
harmless each Stockholder and their respective Affiliates, against and in respect of any and all Damages arising out of, resulting
from or incurred in connection with (i) any inaccuracy in any representation or the breach of any warranty made by the Purchaser
in this Agreement or the breach by the Purchaser of any covenant or agreement to be performed by it hereunder.

 

(d) Any Person providing indemnification
pursuant to the provisions of this Section 8.2 is hereinafter referred to as an “Indemnifying Party” and any Person
entitled to be indemnified pursuant to the provisions of this Section 8.2 is hereinafter referred to as an “Indemnified Party”.

 

Section
8.3 Procedures for Third Party Claims. In the case of any claim for indemnification arising from a claim of a third party
(a “Third Party Claim”), an Indemnified Party shall give prompt written notice to the Indemnifying Party of
any claim or demand which such Indemnified Party has knowledge and as to which it may request indemnification hereunder. The Indemnifying
Party shall have the right to defend and to direct the defense against any such Third Party Claim, in its name or in the name
of the Indemnified Party, as the case may be, at the expense of the Indemnifying Party, and with counsel selected by the Indemnifying
Party unless

 

    	 	-13-	 

     

    

 

(a)
such Third Party Claim seeks an order, injunction or other equitable relief against the Indemnified Party, or (b) the Indemnified
Party shall have reasonably concluded that (i) there is a conflict of interest between the Indemnified Party and the Indemnifying
Party in the conduct of the defense of such Third Party Claim or (ii) the Indemnified Party has one or more defenses not available
to the Indemnifying Party. Notwithstanding anything in this Agreement to the contrary, the Indemnified Party shall, at the expense
of the Indemnifying Party, cooperate with the Indemnifying Party, and keep the Indemnifying Party fully informed, in the defense
of such Third Party Claim. The Indemnified Party shall have the right to participate in the defense of any Third Party Claim with
counsel employed at its own expense; provided, however, that, in the case of any Third Party Claim described in clause (a) or (b)
of the second preceding sentence or as to which the Indemnifying Party shall not in fact have employed counsel to assume the defense
of such Third Party Claim, the reasonable fees and disbursements of such counsel shall be at the expense of the Indemnifying Party.
The Indemnifying Party shall have no indemnification obligations with respect to any Third Party Claim which shall be settled by
the Indemnified Party without the prior written consent of the Indemnifying Party, which consent shall not be unreasonably withheld
or delayed.

 

Section 8.4 Procedures for Inter-Party
Claims. In the event that an Indemnified Party determines that it has a claim for Damages against an Indemnifying Party hereunder
(other than as a result of a Third Party Claim), the Indemnified Party shall give prompt written notice thereof to the Indemnifying
Party, specifying the amount of such claim and any relevant facts and circumstances relating thereto. The Indemnified Party shall
provide the Indemnifying Party with reasonable access to its books and records for the purpose of allowing the Indemnifying Party
a reasonable opportunity to verify any such claim for Damages. The Indemnified Party and the Indemnifying Party shall negotiate
in good faith regarding the resolution of any disputed claims for Damages. In the event of disagreement on the Damages, the Indemnified
Party shall be entitled to submit a claim to the authorized court in Israel against the Indemnifying Party and the cost of such
proceedings (including costs of investigation and reasonable attorney fees and disbursements) shall be awarded to the prevailing
party.

 

Section 8.5.
Limitation on indemnification. Notwithstanding
anything to the contrary in this Agreement, the total aggregate liability of any Indemnifying Party to pay indemnification amounts,
is expressly limited as set forth in each and all of the provisions below, except in the case of fraud.

 

(a) No
claim for indemnification may be made after expiration of the Survival Periods as set forth below in this Section
8.5(a). However, if prior to the end of the applicable Survival Period an Indemnified Party submits a claim to court
regarding an indemnifiable event that has previously occurred or surfaced, the Indemnified Party will be entitled to
indemnification for the Damages arising from such event (subject to the limitations set forth elsewhere in this Section Error!
Reference source not found.) even if the final resolution of this matter occurs after the end of such Survival
Period.

 

    	 	-14-	 

     

    

 

(i) The Survival Period with regard to
each Purchaser’s and Stockholders’ representations concerning the right to sell or issue the Shares or the Purchaser Stock, as
applicable, shall be seven (5) years as of the Closing Date;

 

(ii) The Survival Period with regard to
Stockholders representations concerning Taxes, shall be seven (5) years as of the Closing Date;

 

(iii) The Survival Period with regard to
all other representations, shall be twenty four (24) months as of the Closing Date.

 

(b) Where Purchaser Damages are based on
breach of a representation regarding the Company or its Subsidiaries, all Stockholders shall participate in the payment of Damages,
each according solely to his pro-rata share in the Company’s shares immediately prior to the Closing, always subject to the limitations
set forth in this Section 8.5.

 

(c) Where Purchaser Damages arise from
a breach by a certain Stockholder of his representations regarding his Shares, the indemnification amount due to the Indemnified
Parties, shall be due solely and exclusively from such Stockholder and no other Stockholder shall be held liable for it, always
subject to the procedure and limitations set forth in this Section Error! Reference source not found..

 

(d) The maximum aggregate indemnification
liability of each Stockholder (whether arising in law or equity, in contract, tort, any other theory of law or otherwise) towards
any and all Indemnified Parties for any Purchaser Damages giving rise to indemnification or otherwise in connection with this Agreement,
shall not exceed the value of the Purchaser Stock held by such Stockholder at the Closing or upon such claim, according to the
higher.

 

(e) The maximum aggregate indemnification
liability of the Purchaser (whether arising in law or equity, in contract, tort or any other theory of law) towards any and all
Indemnified Parties for any Stockholders Damages giving rise to indemnification, shall not exceed the value of the Shares at the
Closing date.

 

(f) no claim for indemnification pursuant
to this Agreement with respect to the Company’s representations, shall be brought against any Stockholder unless and until the
aggregate amount of Purchaser Damages for which indemnification is due from all Stockholders in the aggregate equals or exceeds
US$50,000, in which case of a claim or claims in excess of the aforesaid threshold the full amount of such Purchaser Damages shall
be paid from the first dollar thereof.

 

(g) Without prejudice to any of the limitation
provisions of this Section Error! Reference source not found., no Party shall be liable for special, punitive, exemplary,
consequential, or indirect damages, or lost profits, whether based on contract, tort, strict liability, other theory of law or
otherwise.

 

(h) The aforesaid limited liability according
to all the provisions of this Section Error! Reference source not found. constitutes the sole and exclusive remedy for the
Indemnified Parties under and arising from this Agreement. However, none of the aforesaid limitations shall apply in case of fraud
by any Stockholder or by the Purchaser.

 

    	 	-15-	 

     

    

 

Section
8.6 Indemnity Escrow. Subject in all instances to the limitations and provisions provided for in this Section 8, at the
Closing, the Purchaser shall deposit the Indemnity Escrow Stock with the Escrow Agent pursuant to the Escrow Agreement attached
hereto as Schedule 8.6. The Indemnity Escrow Stock shall be governed by the terms of the Escrow Agreement. The Indemnity
Escrow Stock shall be held in escrow until the first Business Day following the two year anniversary of the Closing Date. The
Indemnity Escrow Stock, as long as it is held in escrow, shall be available to settle certain contingencies as provided in Section
8. Each Stockholder’s portion of any Purchaser Stock contained in the Indemnity Escrow Stock (as defined in the Escrow Agreement)
which are not issued or set aside for the satisfaction of such contingencies will be released to the Stockholders in accordance
with the Escrow Agreement, subject to required withholding.

 

ARTICLE IX STOCKHOLDERS’ REPRESENTATIVE

 

Section 9.1 Stockholders’ Representative.

 

(i)
Moshe Zimmerman, the Stockholder Representative, is hereby appointed as representative, attorney-in-fact and agent, with
full power of substitution to act in the name, place and stead of each Stockholder to take all actions necessary or appropriate
in the judgment of the Stockholder Representative for the accomplishment of the terms of this Agreement, and to act on behalf of
each Stockholder in any amendment of or litigation or arbitration involving this Agreement or any Ancillary Agreements and to do
or refrain from doing all such further acts and things, and to execute all such documents, as such Stockholder Representative shall
deem necessary or appropriate in conjunction with any of the transactions contemplated by this Agreement, including the power:

 

(i) to take all action necessary or desirable
in connection with the waiver of any condition to the obligations of the Stockholders to consummate the transactions contemplated
by this Agreement and the Ancillary Agreements;

 

(ii) to negotiate, execute and deliver
all statements, certificates, statements, notices, approvals, extensions, waivers, undertakings, amendments and other documents
required or permitted to be given in connection with the consummation of the transactions contemplated by this Agreement (it being
understood that a Stockholder shall execute and deliver any such documents which the Stockholder Representative agrees to execute);

 

(iii) to give and receive all notices and
communications to be given or received under this Agreement and to receive service of process in connection with the any claims
under this Agreement, including service of process in connection with arbitration; and

 

(iv) to take all actions or refrain from
doing any further act or deed on behalf of the Stockholders which the Stockholder Representative deems necessary or appropriate
in his sole discretion relating to the subject matter of this Agreement as fully and completely as a Company Stockholder could
do if personally present.

 

(j)
Notwithstanding the enumerated powers granted to the Stockholder Representative in Section 9.1(a) above, the Stockholder
Representative shall not have the power to:

 

    	 	-16-	 

     

    

 

(i)
waive the condition to the obligations of the Stockholders to consummate the transactions set forth in Section 5.3(f);

 

(k) If the Stockholder Representative becomes
unable to serve as Stockholder Representative, such other Person or Persons as may be designated by him who shall be one of the
Stockholders holding the majority of the Purchaser Common Stock, shall succeed as the Stockholder Representative.

 

(l) The Stockholder Representative shall
not be held liable by any of the Stockholders for actions or omissions in exercising or failing to exercise all or any of the power
and authority of the Stockholder Representative pursuant to this Agreement, except in the case of the Stockholder Representative’s
gross negligence, bad faith or willful misconduct. The Stockholder Representative shall be entitled to rely on the advice of counsel,
public accountants or other independent experts that it reasonably determines to be experienced in the matter at issue, and will
not be liable to any Stockholder for any action taken or omitted to be taken in good faith based on such advice. The Stockholders
will, severally and not jointly, indemnify (in accordance with their pro rata percentages) the Stockholder Representative from
any losses arising out of its serving as the Stockholder Representative hereunder, except for losses arising out of or caused by
the Stockholder Representative’s gross negligence, bad faith or willful misconduct. The Stockholder Representative is serving in
his capacity as such solely for purposes of administrative convenience, and is not personally liable in such capacity for any of
the obligations of the Stockholders hereunder, and the Purchaser and the Company agree that they will not look to the personal
assets of the Stockholder Representative, acting in such capacity, for the satisfaction of any obligations to be performed by the
Stockholders hereunder except to the extent of the Stockholder Representative’s gross negligence, bad faith or willful misconduct.

 

ARTICLE X MISCELLANEOUS PROVISIONS

 

Section 10.1 Further Assurances.
Each party to this Agreement shall execute and cause to be delivered to each other party to this Agreement such instruments and
other documents, and shall take such other actions, as such other parties may reasonably request (prior to, at or after the Closing)
for the purpose of carrying out or evidencing any of the transactions contemplated by this Agreement.

 

Section 10.2 Regulation S Disclosures.
THE PURCHASER COMMON STOCK ISSUED TO STOCKHOLDERS HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT AND MAY NOT BE OFFERED OR SOLD
IN THE UNITED STATES OR TO U.S. PERSONS (OTHER THAN DISTRIBUTORS, AS SUCH TERM IS DEFINED IN REGULATION S) UNLESS THE PURCHASER
COMMON STOCK IS REGISTERED UNDER THE SECURITIES ACT, OR AN EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT IS
AVAILABLE. HEDGING TRANSACTIONS INVOLVING THE PURCHASER COMMON STOCK ISSUED TO STOCKHOLDERS MAY NOT BE CONDUCTED UNLESS IN COMPLIANCE
WITH THE SECURITIES ACT.

 

Section
10.3 Fees and Expenses. Each party to this Agreement shall bear and pay all fees, costs and expenses (including legal fees
and accounting fees) that have been incurred or that are incurred by such party in connection with the transactions contemplated
by this Agreement.

 

    	 	-17-	 

     

    

 

Section 10.4 Waiver; Amendment.
Any agreement on the part of a party to this Agreement to any extension or waiver of any provision of this Agreement shall be valid
only if set forth in an instrument in writing signed on behalf of such party. A waiver by a party to this Agreement of the performance
of any covenant, agreement, obligation, condition, representation or warranty shall not be construed as a waiver of any other covenant,
agreement, obligation, condition, representation or warranty. A waiver by any party to this Agreement of the performance of any
act shall not constitute a waiver of the performance of any other act or an identical act required to be performed at a later time.
Prior to the Closing, this Agreement may not be amended, modified or supplemented except by written agreement among the Purchaser,
the Company and the Stockholders’ Representative. Following the Closing, this Agreement may not be amended, modified, altered
or supplemented except by written agreement between the Purchaser and the Stockholders’ Representative.

 

Section 10.5 Entire Agreement. This
Agreement and the other agreements referred to in this Agreement constitute the entire agreement among the parties to this Agreement
and supersede all other prior agreements and understandings, both written and oral, among or between any of the parties with respect
to the subject matter of this Agreement and thereof.

 

Section 10.6 Execution of Agreement; Counterparts; Electronic
Signatures.

 

(a)
This Agreement may be executed in several counterparts, each of which shall be deemed an
original and all of which, when taken together, shall constitute one and the same instrument, and shall become effective when
counterparts have been signed by each of the parties to this Agreement and delivered to the other parties to this Agreement; it
being understood that all parties to this Agreement need not sign the same counterparts. Facsimile and “.pdf’ copies
of signed signature pages shall be deemed binding originals and no party to this Agreement shall raise the use of facsimile machine
or electronic transmission in “.pdf’ as a defense to the formation of a contract.

 

Section 10.7 Governing Law and Venue.
This Agreement shall be governed by, and construed and enforced in accordance with, the laws of the State of Israel, without regard
to any provision thereof that would require the application of the law of any other jurisdiction except for securities laws applicable
to the Parties. Each party hereby submits to the exclusive jurisdiction of the courts of the State of Israel.

 

Section 10.8 Attorneys’ Fees.
If any Legal Proceeding relating to the enforcement of any provision of this Agreement is brought against any party to this Agreement,
the prevailing party shall be entitled to recover reasonable attorneys’ fees, costs and disbursements (in addition to any
other relief to which the prevailing party may be entitled).

 

Section 10.9 Assignment and Successors.
No party to this Agreement may assign any of its rights or delegate any of its obligations under this Agreement without the prior
written consent of the other parties to this Agreement. Subject to the preceding sentence, this Agreement shall apply to, be binding
in all respects upon and inure to the benefit of the successors and permitted assigns of the parties to this Agreement.

 

Section 10.10 Parties in Interest.
Except for the provisions of ARTICLE IX, none of the provisions of this Agreement is intended to provide any rights or remedies
to any Person other than the parties to this Agreement and their respective successors and assigns (if any).

 

    	 	-18-	 

     

    

 

Section 10.11 Notices. All notices,
requests, claims, demands, consents, waivers and other communications required or permitted by this Agreement shall be in writing
and shall be deemed given to a party to this Agreement when (a) delivered to the appropriate address by hand or by nationally recognized
overnight courier service (costs prepaid), or (b) sent e-mail with confirmation of transmission by the transmitting equipment confirmed
with a copy delivered as provided in clause (a), in each case to the following addresses, facsimile numbers or e-mail addresses
and marked to the attention of the Person (by name or title) designated below (or to such other address, facsimile number, e-mail
address or Person as a party may designate by notice to the other parties to this Agreement):

 

If to the Company and the Stockholders’ Representative
of behalf of the Stockholders:

 

Moshe Zimmerman

 

If to the Purchaser:

Dr. Fernando de la Vega, CEO

fernando@pvnanocell.com

Tel: +972-4-6546881, Fax: +972-4-6546880, Mobile phone: +972-54-5599061

 

with a mandatory copy to (which copy shall not constitute
notice):

 

Primes, Shiloh, Givon, Meir – Law Firm

Attn.: Meytal Katz, Adv. Meytal@pgs-law.co.il

16, Derech Hayam, Haifa Israel 34741

Fax: ++972-4-8381401

 

(a) Interpretation. In this Agreement, unless a clear
contrary intention appears:

 

(i) the singular number includes the plural number and vice
versa;

 

(ii) reference to any Person includes such
Person’s successors and assigns but, if applicable, only if such successors and assigns are not prohibited by this Agreement,
and reference to a Person in a particular capacity excludes such Person in any other capacity or individually;

 

(iii) reference to any gender includes
each other gender;

 

    	 	-19-	 

     

    

 

(iv) reference to any agreement, document
or instrument means such agreement, document or instrument as amended or modified and in effect from time to time in accordance
with the terms thereof;

 

(v) reference to any Law means such Law
as amended, modified, codified, replaced or reenacted, in whole or in part, and in effect from time to time, including rules and
regulations promulgated thereunder, and reference to any section or other provision of any Law means that provision of such Law
from time to time in effect and constituting the substantive amendment, modification, codification, replacement or reenactment
of such section or other provision;

 

(vi) “including” means including
without limiting the generality of any description preceding such term;

 

(vii) references to documents, instruments
or agreements shall be deemed to refer as well to all addenda, exhibits, schedules or amendments thereto; and

 

(viii) reference to a “Section”
or “Article” in this Agreement shall mean a Section or Article, respectively, of this Agreement unless otherwise provided.

 

(a) Legal Representation of the Parties. This Agreement
was negotiated by the parties to this Agreement with the benefit of legal representation and any rule of construction or interpretation
otherwise requiring this Agreement to be construed or interpreted against any party to this Agreement shall not apply to any construction
or interpretation of this Agreement.

 

(b) Headings. The headings contained
in this Agreement are for the convenience of reference only, shall not be deemed to be a part of this Agreement and shall not be
referred to in connection with the construction or interpretation of this Agreement.

 

(c) Dollar
Amounts. All references to “$” contained
in this Agreement shall refer to United States Dollars unless otherwise stated.

 

Section 10.12 Severability. If any
provision of this Agreement is held invalid or unenforceable by any court of competent jurisdiction, the other provisions of this
Agreement shall remain in full force and effect. Any provision of this Agreement held invalid or unenforceable only in part or
degree shall remain in full force and effect to the extent not held invalid or unenforceable.

 

Section 10.13 Schedules and Exhibits.
The Schedules and Exhibits attached to this Agreement (including the Disclosure Schedule) are hereby incorporated into this Agreement
and are hereby made a part of this Agreement as if set out in full in this Agreement.

 

[This Page Intentionally
Left Blank]

 

    	 	-20-	 

     

    

 

[Share Exchange Agreement –
Signature Page]

 

IN WITNESS WHEREOF, the parties hereto
have caused this Share Exchange Agreement to be duly executed, as of the date first above written.

 

	 	THE PURCHASER:
	 	 	 
	 	By:	                 
	 	 	Name: Dr. Fernando de la Vega 
	 	 	Title: CEO
	 	 	 
	 	THE COMPANY:
	 	 	 
	 	By:	            
	 	 	Name: 
	 	 	Title:
	 	 	 
	 	STOCKHOLDERS’ REPRESENTATIVE:
	 	 
	 	STOCKHOLDER
	 	 
	 	For individuals:
	 	 	 
	 	By:	                
	 	 	Name:
	 	 	 
	 	For entities: Stockholder Name:
	 	 
	 	By:	                
	 	 	Name:
	 	 	Title:
	 	 	 
	 	Address for notices: 
	 	Tax ID Number:

 

    	 	-21-	 

     

    

 

	 	 
	 	Jet CU P.C.B Ltd.
	 	 	 
	 	We hereby confirm our agreement to be bound and comply with the terms of the SPA and the terms of Section 1.1(c) and 1.1(d) of this Agreement.
	 	 	 
	 	By:	 
	 	 	Name:
	 	 	Title:

 

    	 	-22-	 

     

    

 

Definitions

 

For purposes of the Agreement (including this EXHIBIT 1):

 

“Affiliate” means, with
respect to any specified Person, any other Person who or which, directly or indirectly, controls, is controlled by, or is under
common control with such specified Person, including, without limitation, any general partner, limited partner, member, officer,
director or manager of such Person and any venture capital or private equity fund now or hereafter existing that is controlled
by one or more general partners or managing members of, or shares the same management company with, such Person. For purposes of
this definition, the terms “controls,” “controlled by,” or “under common control with”
means the possession, direct or indirect, of power to direct or cause the direction of management or policies (whether through
ownership of voting securities, by contract or otherwise).

 

“Agreement’ means the
Share Exchange Agreement of which this Exhibit 1 is a part, as amended or restated from time to time.

 

“Ancillary Agreements”
means the Escrow Agreement, the Paying Agent Agreement and the transaction documents entered into among the Purchaser, the Company
and the other parties thereto in connection with the Investment Transaction.

 

“Business Day” means
any day of the year on which national banking institutions in Israel are open to the public for conducting business and are not
required or authorized to close.

 

“Closing” means the
consummation of the purchase and sale of the Shares as set forth in ARTICLE VI of the Agreement.

 

“Confidential Information”
means any data or information concerning the Company (including trade secrets), without regard to form, regarding (for example
and including) (a) business process models, (b) proprietary software, (c) research, development, products, services, marketing,
selling, business plans, budgets, unpublished financial statements, licenses, prices, costs, Agreements, suppliers, customers,
and customer lists, (d) the identity, skills and compensation of employees, contractors, and consultants, (e) specialized training,
discoveries, developments, trade secrets, processes, formulas, data, lists, and all other works of authorship, mask works, ideas,
concepts, know-how, designs, and techniques, whether or not any of the foregoing is or are patentable, copyrightable, or registrable
under any intellectual property Laws or industrial property Laws in the United States or elsewhere. Notwithstanding the foregoing,
no data or information constitutes “Confidential Information” if such data or information is publicly known and in
the public domain through means that do not involve a breach by the Company or a Stockholder of any covenant or obligation set
forth in the Agreement.

 

“Contingent Obligation”
means, as to any Person, any direct liability of that Person with respect to any indebtedness, lease, dividend or other obligation
of another Person if the primary purpose or intent of the Person incurring such liability, or the primary effect thereof, is to
provide assurance to the obligee of such liability that such liability will be paid or discharged, or that any agreements relating
thereto will be complied with, or that the holders of such liability will be protected (in whole or in part) against loss with
respect thereto.

 

“Contract” means any
written, oral or other agreement, contract, subcontract, lease, understanding, instrument, note, warranty, license, sublicense,
insurance policy, benefit plan or legally binding commitment or undertaking of any nature, whether express or implied.

 

“Escrow Agent”
means ESOP Management and Trust Services Ltd.

 

    	 	-23-	 

     

    

 

“Escrow
Agreement” means the agreement signed at the Closing between the Escrow Agent, the Purchaser and the Stockholders Representative
and the Company, substantially in the form of Schedule 8.5.

 

“Entity” means any corporation
(including any non-profit corporation), general partnership, limited partnership, limited liability partnership, joint venture,
estate, trust, company (including any limited liability company or joint stock company), firm or other enterprise, association,
organization or entity.

 

“GAAP” means United
States generally accepted accounting principles as in effect from time to time.

 

“Governmental Authorization”
means any (a) approval, permit, license, certificate, certificate of approval, franchise, permission, clearance, registration,
qualification or other authorization issued, granted, given or otherwise made available by or under the authority of any Governmental
Body or pursuant to any Law, or (b) right under any Contract with any Governmental Body.

 

“Governmental Body”
means any domestic or foreign multinational, federal, state, provincial, municipal or local government (or any political subdivision
thereof) or any domestic or foreign governmental, regulatory or administrative authority or any department, commission, board,
agency, court, tribunal, judicial body or instrumentality thereof, or any other body exercising, or entitled to exercise, any administrative,
executive, judicial, legislative, police, regulatory or taxing authority or power of any nature (including any arbitral body).

 

“Indebtedness” means
any of the following: (a) any indebtedness, whether or not contingent, for borrowed money; (b) any obligations evidenced by bonds,
debentures, notes or other similar instruments; (c) any obligations to pay the deferred purchase price of property or services;
(d) any obligations as lessee under leases that have been, or should be, recorded as capitalized leases; (e) any indebtedness created
or arising under any conditional sale or other title retention agreement with respect to acquired property; (f) any obligations,
contingent or otherwise, under or with respect to acceptance credit, letters of credit or similar facilities; (g) any obligation
with respect to interest rate and currency cap, collar, hedging or swap Contracts; (h) any obligation secured by a Lien; (i) a
guarantee of the obligations of any other Person (other than guarantee provided to the lessor of the Company’s premises); (j) any
guaranty of any of the foregoing; (k) any accrued interest, fees and charges in respect of any of the foregoing; and (l) any prepayment
premiums and penalties, and any other fees, expenses, indemnities and other amounts payable as a result of the prepayment or discharge
of any of the foregoing.

 

“Indemnity Escrow Stock”
means with respect to each Stockholder, 15% of the Purchaser Stock issued to such Stockholder.

 

“Law” means any Israeli and US federal, national,
state, provincial, territorial, local, municipal, foreign or international, multinational other law, statute, constitution, principle
of common law, resolution, ordinance, code, edict, decree, rule, regulation, ruling or requirement issued, enacted, adopted, promulgated,
implemented or otherwise put into effect by or under the authority of any Governmental Body.

 

“Legal Proceeding” means
any ongoing or threatened action, suit, litigation, arbitration, proceeding (including any civil, criminal, administrative, investigative
or appellate proceeding), hearing, order, inquiry, audit, examination or investigation commenced, brought, conducted or heard by
or before, or otherwise involving, any court or other Governmental Body or any arbitrator or arbitration panel.

 

    	 	-24-	 

     

    

 

“Liabilities” means
any direct liabilities, obligations, expenses, Indebtedness, claims, and commitments.

 

“Lien” means any lien,
pledge, hypothecation, charge, mortgage, security interest, encumbrance, claim, infringement, interference, option, right of first
refusal, preemptive right, community property interest or restriction of any nature affecting property, real or personal, tangible
or intangible, including any restriction on the voting of any security, any restriction on the transfer of any security or other
asset, any restriction on the receipt of any income derived from any asset, any restriction on the use of any asset, any restriction
on the possession, exercise or transfer of any other attribute of ownership of any asset, any lease in the nature thereof and any
filing of or agreement to give any financing statement under the Uniform Commercial Code (or equivalent statute of any jurisdiction).

 

“Material
Adverse Effect” means, with respect to each party, a material adverse effect on (i) the
financial condition, business, assets, prospects or results of operations of the party, taken as a whole, (ii) the ability of the
party to perform its obligations under this Agreement or (iii) the ability of the party to consummate the Transactions and the
other transactions contemplated hereby; provided, however, that in no event shall any change resulting from conditions affecting
the industry in which such party operates or from changes in general business or economic conditions be taken into account in determining
whether there has been a Material Adverse Effect except to the extent such change has a disproportionate impact on the applicable
party relative to other businesses operating in the same industry.

 

“Ordinary Course of Business”
means the ordinary and usual course of day-to-day operations of the business of the Company through the date hereof consistent
with past practice.

 

“Paying Agent Agreement” means
the agreement between ESOP Management and Trust Services Ltd, the Purchaser, the Stockholders to be signed at the Closing date.

 

“Person” means any individual, Entity, trust,
Governmental Body or other organization.

 

“Regulation S” means
Regulation S under the Securities Act, as the same may be amended from time to time, or any similar rule or regulation hereafter
adopted by the United States Securities and Exchange Commission.

 

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

 

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

 

    	 	-25-	 

     

    

 

“Taxes”
means (a) any and all taxes, charges, fees, levies or other similar assessments or liabilities in the nature of a tax, including
income, gross receipts, ad valorem, premium, value-added, net worth, capital stock, capital gains, documentary, recapture, alternative
or add-on minimum, disability, estimated, registration, recording, excise, escheat, real property, personal property, sales, use,
license, lease, service, service use, transfer, withholding, employment, unemployment, insurance, employment insurance, social
security, business license, business organization, environmental, worker’s compensation, pension, payroll, profits, severance,
stamp, occupation, windfall profits, customs, franchise and other taxes of any kind whatsoever imposed by the United States, or
any state, provincial, local or foreign government, or any agency or political subdivision thereof, (b) any interest, penalties
or additions to tax imposed with respect to such items or any contest or dispute thereof or in connection with the failure to
timely or properly file any Tax Return; (c) any liability for payment of amounts described in clause (a) or (b) whether as a result
of transferee liability, of being a member of an affiliated, consolidated, combined or unitary group for any period or otherwise
through operation of law; and (d) any liability for the payment of amounts described in clauses (a), (b) or (c) as a result of
any tax sharing, tax indemnity or tax allocation agreement or any other express or implied agreement to indemnify any other Person.

 

“Tax Returns” means
any and all reports, returns, or declarations relating to Taxes filed or required to be filed with any Governmental Body, including
any schedule or attachment thereto, including any amendment thereof.

 

“Termination Date” means
the date prior to the Closing on which the Agreement is terminated in accordance with ARTICLE VIII of the Agreement.

 

“U.S. Person” has the meaning set forth in
Regulation S.

 

    	 	-26-

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