Document:

Exhibit 10.2

 

FORM OF REGISTRATION RIGHTS AGREEMENT

 

REGISTRATION RIGHTS
AGREEMENT (this "Agreement"), dated as of February [__], 2015, by and among Enerpulse Technologies, Inc.,
a Nevada corporation, with headquarters located at 2451 Alamo Ave SE, Albuquerque, New Mexico 87106 (the "Company"),
ROTH Capital Partners, LLC (the "Placement Agent") and the investors listed on the Schedule of Buyers attached
hereto (each, a "Buyer" and collectively, the "Buyers").

 

WHEREAS:

 

A.In connection with
the Securities Purchase Agreement by and among the parties hereto of even date herewith (the "Securities Purchase Agreement"),
the Company has agreed, upon the terms and subject to the conditions of the Securities Purchase Agreement, to issue and sell to
each Buyer (i) senior secured convertible notes of the Company (the "Notes"), which will, among other things,
be convertible (upon conversion, interest or otherwise) into the Company's common stock, par value $0.001 per share (the "Common
Stock") (the shares of Common Stock issuable pursuant to the terms of the Notes, including, without limitation, upon conversion
and as interest, collectively, the "Conversion Shares") and (ii) warrants (the "Warrants") which
will be exercisable to purchase shares of Common Stock (as exercised, collectively, the "Warrant Shares") in accordance
with the terms of the Warrants. In addition, the Company has offered to issue to the Placement Agent the Roth Warrant (as hereinafter
defined) which will be exercisable to purchase Roth Warrant Shares (as hereinafter defined) in accordance with the Roth Warrants
and pursuant to the terms of the Engagement Letters (as defined in the Securities Purchase Agreement) in connection with the sale
of the Securities (as defined in the Securities Purchase Agreement).

 

B.In accordance with
the terms of the Securities Purchase Agreement, the Company has agreed to provide certain registration rights under the Securities
Act of 1933, as amended, and the rules and regulations thereunder, or any similar successor statute (collectively, the "1933
Act"), and applicable state securities laws.

 

NOW, THEREFORE,
in consideration of the premises and the mutual covenants contained herein and other good and valuable consideration, the receipt
and sufficiency of which are hereby acknowledged, the Company and each of the Buyers hereby agree as follows:

 

1.Definitions.

 

Capitalized terms used
herein and not otherwise defined herein shall have the respective meanings set forth in the Securities Purchase Agreement. As used
in this Agreement, the following terms shall have the following meanings:

 

(a)"Business
Day" means any day other than Saturday, Sunday or any other day on which commercial banks in the City of New York are
authorized or required by law to remain closed.

 

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(b)"Closing
Date" shall have the meaning set forth in the Securities Purchase Agreement.

 

(c)"Cutback
Shares" means any of the Required Registration Amount of Registrable Securities not included in a Registration Statement
hereunder as a result of a limitation on the maximum number of shares of Common Stock of the Company permitted to be registered
by the staff of the SEC pursuant to Rule 415. For the purpose of determining the Cutback Shares, in order to determine the Required
Registration Amount, unless an Investor gives written notice to the Company to the contrary with respect to the allocation of its
Cutback Shares, first the Roth Warrant Shares issued and issuable upon exercise of the Roth Warrant shall be excluded on a pro
rata basis until all of the Roth Warrant Shares have been excluded, second the Warrant Shares shall be excluded on a pro rata basis
among the Investors until all of the Warrant Shares have been excluded, and third the Conversion Shares shall be excluded on a
pro rata basis among the Investors until all of the Conversion Shares have been excluded.

 

(d)"Effective
Date" means the date that the Registration Statement has been declared effective by the SEC.

 

(e)"Effectiveness
Deadline" means the date which is the earlier of (x) (i) in the event that the Registration Statement is not subject to
a full review by the SEC, ninety (90) calendar days after the Closing Date or (ii) in the event that the Registration Statement
is subject to a full review by the SEC, one hundred fifty (150) calendar days after the Closing Date and (y) the fifth (5th)
Business Day after the date the Company is notified (orally or in writing, whichever is earlier) by the SEC that such Registration
Statement will not be reviewed or will not be subject to further review; provided, however, that if the Effectiveness
Deadline falls on a Saturday, Sunday or other day that the SEC is closed for business, the Effectiveness Deadline shall be extended
to the next Business Day on which the SEC is open for business.

 

(f)"Eligible
Market" means the Principal Market, The New York Stock Exchange, Inc., the NYSE MKT LLC, The NASDAQ Capital Market, The
NASDAQ Global Select Market, The Nasdaq Global Market or the OTC QB.

 

(g)"Filing
Date" means the date on which the Registration Statement is filed with the SEC.

 

(h)"Filing
Deadline" means the date which is thirty (30) calendar days after the Closing Date.

 

(i)"Investor"
means a Buyer or any transferee or assignee thereof to whom a Buyer assigns its rights under this Agreement and who agrees to become
bound by the provisions of this Agreement in accordance with Section 9 and any transferee or assignee thereof to whom a transferee
or assignee assigns its rights under this Agreement and who agrees to become bound by the provisions of this Agreement in accordance
with Section 9.

 

(j)"Person"
means an individual, a limited liability company, a partnership, a joint venture, a corporation, a trust, an unincorporated organization
and a government or any department or agency thereof.

 

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(k)"Principal
Market" means the OTC QX.

 

(l)"register,"
"registered," and "registration" refer to a registration effected by preparing and filing one
or more Registration Statements (as defined below) in compliance with the 1933 Act and pursuant to Rule 415, and the declaration
or ordering of effectiveness of such Registration Statement(s) by the SEC.

 

(m)"Registrable
Securities" means (i) the Conversion Shares issued or issuable pursuant to the terms of the Notes, (ii) the Warrant Shares
issued or issuable upon exercise of the Warrants (iii) the Roth Warrant Shares issued or issuable upon exercise of the Roth Warrants
and (iv) any capital stock of the Company issued or issuable with respect to the Notes, the Conversion Shares, the Warrant Shares,
the Roth Warrant Shares, the Warrants or the Roth Warrants as a result of any stock split, stock dividend, recapitalization, exchange
or similar event or otherwise, in each case without regard to any limitations on conversion, amortization and/or redemption of
the Notes or exercise of the Warrants or the Roth Warrants.

 

(n)"Registration
Statement" means a registration statement or registration statements of the Company filed under the 1933 Act covering
the resale of the Registrable Securities.

 

(o)"Required
Holders" means the holders of at least a majority of the Registrable Securities.

 

(p)"Required
Registration Amount" means 125% of the maximum number of Conversion Shares issued and issuable pursuant to the Notes as
of the Trading Day immediately preceding the applicable date of determination and subject to adjustment as provided in Section
2(f), without regard to any limitations on conversion, and/or redemption of the Notes; provided that the Required Registration
Amount shall not include any applicable Cutback Shares.

 

(q)"Roth Warrant Shares" means shares
of Common Stock issued and issuable by the Company upon exercise of the Roth Warrants.

 

(r)"Roth
Warrants" means those certain warrants to be issued to the Placement Agent pursuant to the Engagement Letter (as defined
in the Securities Purchase Agreement) in connection with the sale of the Securities (as defined in the Securities Purchase Agreement).

 

 

(s)"Rule
415" means Rule 415 promulgated under the 1933 Act or any successor rule providing for offering securities on a continuous
or delayed basis.

 

(t)"SEC"
means the United States Securities and Exchange Commission.

 

(u)"Trading
Day" means any day on which the Common Stock is traded on the Principal Market, or, if the Principal Market is not the
principal trading market for the Common Stock, then on the principal securities exchange or securities market on which the Common
Stock is then traded; provided that "Trading Day" shall not include any day on which the Common Stock is scheduled to
trade on such exchange or market for less than 4.5 hours or any day that the Common Stock is suspended from trading during the
final hour of trading on such exchange or market (or if such exchange or market does not designate in advance the closing time
of trading on such exchange or market, then during the hour ending at 4:00:00 p.m., New York time).

 

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2.Registration.

 

(a)Mandatory
Registration. The Company shall prepare, and, as soon as practicable but in no event later than the Filing Deadline, file with
the SEC the Registration Statement on Form S-1 covering the resale of all of the Required Registration Amount of the Registrable
Securities. In the event that Form S-1 is unavailable for such a registration, the Company shall use such other form as is available
for such a registration on another appropriate form reasonably acceptable to the Required Holders, subject to the provisions of
Section 2(e). The Registration Statement prepared pursuant hereto shall register for resale at least the number of shares of Common
Stock equal to the Required Registration Amount determined as of the date the Registration Statement is initially filed with the
SEC, subject to adjustment as provided in Section 2(f). The Registration Statement shall contain (except if otherwise directed
by the Required Holders) the "Plan of Distribution" and "Selling Shareholders" sections in substantially
the form attached hereto as Exhibit A. The Company shall use its reasonable best efforts to have the Registration Statement
declared effective by the SEC as soon as practicable, but in no event later than the Effectiveness Deadline. By 9:30 a.m. New York
time on the Business Day following the Effective Date, the Company shall file with the SEC in accordance with Rule 424 under the
1933 Act the final prospectus to be used in connection with sales pursuant to such Registration Statement.

 

(b)Intentionally
omitted.

 

(c)Allocation
of Registrable Securities. The initial number of Registrable Securities included in any Registration Statement and any increase
or decrease in the number of Registrable Securities included therein shall be allocated pro rata among the Investors based on the
number of Registrable Securities held by each Investor at the time the Registration Statement covering such initial number of Registrable
Securities or increase or decrease thereof is declared effective by the SEC. In the event that an Investor sells or otherwise transfers
any of such Investor's Registrable Securities, each transferee shall be allocated a pro rata portion of the then remaining number
of Registrable Securities included in such Registration Statement for such transferor. Any shares of Common Stock included in a
Registration Statement and which remain allocated to any Person which ceases to hold any Registrable Securities covered by such
Registration Statement shall be allocated to the remaining Investors, pro rata based on the number of Registrable Securities then
held by such Investors which are covered by such Registration Statement. In no event shall the Company include any securities other
than Registrable Securities on any Registration Statement without the prior written consent of the Required Holders.

 

(d)Legal Counsel.
Subject to Section 5 hereof, the Required Holders shall have the right to select one legal counsel to review and oversee any registration
pursuant to this Section 2 ("Legal Counsel"), which shall be Schulte Roth & Zabel LLP or such other counsel
as thereafter designated by the Required Holders. The Company and Legal Counsel shall reasonably cooperate with each other in performing
the Company's obligations under this Agreement.

 

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(e)Ineligibility
for Form S-3. In the event that Form S-3 is not available for the registration of the resale of Registrable Securities hereunder,
the Company shall (i) register the resale of the Registrable Securities on Form S-1 or another appropriate form reasonably acceptable
to the Required Holders and (ii) undertake to register the Registrable Securities on Form S-3 as soon as such form is available,
provided that the Company shall maintain the effectiveness of the Registration Statement then in effect until such time as a Registration
Statement on Form S-3 covering the Registrable Securities has been declared effective by the SEC.

 

(f)Sufficient
Number of Shares Registered. In the event the number of shares available under a Registration Statement filed pursuant to Section
2(a) or Section 2(b) is insufficient to cover the Required Registration Amount of Registrable Securities required to be covered
by such Registration Statement or an Investor's allocated portion of the Registrable Securities pursuant to Section 2(c), the Company
shall amend the applicable Registration Statement, or file a new Registration Statement (on the short form available therefor,
if applicable), or both, so as to cover at least the Required Registration Amount as of the Trading Day immediately preceding the
date of the filing of such amendment or new Registration Statement, in each case, as soon as practicable, but in any event not
later than fifteen (15) days after the necessity therefor arises. The Company shall use its reasonable best efforts
to cause such amendment and/or new Registration Statement to become effective as soon as practicable following the filing thereof.
For purposes of the foregoing provision, the number of shares available under a Registration Statement shall be deemed "insufficient
to cover all of the Registrable Securities" if at any time the number of shares of Common Stock available for resale under
the Registration Statement is less than the Required Registration Amount. The calculation set forth in the foregoing sentence shall
be made without regard to any limitations on the conversion, amortization and/or redemption of the Notes or exercise of the Warrants
or the Roth Warrants and such calculation shall assume (i) that the Notes are then convertible in full into shares of Common Stock
at the then prevailing Conversion Rate (as defined in the Notes) (ii) the initial outstanding principal amount of the Notes remains
outstanding through the scheduled Maturity Date (as defined in the Notes) and no redemptions of the Notes occur prior to the scheduled
Maturity Date, (iii) the Roth Warrants are then exercisable in full into shares of Common Stock at the then prevailing Exercise
Price (as defined in the Roth Warrants), and (iv) the Warrants are then exercisable in full into shares of Common Stock at the
then prevailing Exercise Price (as defined in the Warrants).

 

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(g)Effect
of Failure to File and Obtain and Maintain Effectiveness of Registration Statement. If (i) the Registration Statement when
declared effective fails to register the Required Registration Amount of Registrable Securities (a "Registration
Failure"), (ii) a Registration Statement covering all of the Registrable Securities required
to be covered thereby and required to be filed by the Company pursuant to this Agreement is (A) not filed with the SEC on or before
the applicable Filing Deadline (a "Filing Failure") or (B) not declared effective
by the SEC on or before the applicable Effectiveness Deadline, (an "Effectiveness Failure")
or (iii) on any day after the applicable Effective Date, sales of all of the Registrable Securities
required to be included on such Registration Statement cannot be made (other than during an Allowable Grace Period (as defined
in Section 3(r))) pursuant to such Registration Statement or otherwise (including, without limitation, because of a failure to
keep such Registration Statement effective, a failure to disclose such information as is necessary for sales to be made pursuant
to such Registration Statement or a failure to register a sufficient number of shares of Common Stock) (a "Maintenance
Failure") then, as partial relief for the damages to any holder by reason of any such delay
in or reduction of its ability to sell the underlying shares of Common Stock (which remedy shall not be exclusive of any other
remedies available at law or in equity, including, without limitation, specific performance or the additional obligation of the
Company to register any Cutback Shares), the Company shall pay to each holder of Registrable Securities relating to such Registration
Statement an amount in cash equal to two percent (2.0%) of the aggregate Purchase Price (as such term is defined in the Securities
Purchase Agreement) of such Investor's Registrable Securities, whether or not included in such Registration Statement, on each
of the following dates: (i) on the thirtieth day after the date of a Registration Failure and every thirtieth day thereafter (pro
rated for periods totaling less than thirty days) until such Registration Failure is cured; (ii) on the thirtieth day after the
date of a Filing Failure and every thirtieth day thereafter (pro rated for periods totaling less than thirty days) until such Filing
Failure is cured; (iii) on the thirtieth day after the date of an Effectiveness Failure and every thirtieth day thereafter (pro
rated for periods totaling less than thirty days) until such Effectiveness Failure is cured; and (iv) on the thirtieth day after
the initial date of a Maintenance Failure and every thirtieth day thereafter (pro rated for periods totaling less than thirty days)
until such Maintenance Failure is cured. The payments to which a holder shall be entitled pursuant to this Section 2(g) are referred
to herein as "Registration Delay Payments." Registration Delay Payments shall
be paid on the earlier of (I) the dates set forth above and (II) the third Business Day after the event or failure giving rise
to the Registration Delay Payments is cured. In the event the Company fails to make Registration Delay Payments in a timely manner,
such Registration Delay Payments shall bear interest at the rate of one percent (1.0%) per month (prorated for partial months)
until paid in full. Notwithstanding the foregoing, (i) no Registration Delay Payments shall be owed to an Investor with respect
to any period during which all of such Investor’s Registrable Securities may be sold by such Investor under Rule 144 or,
with respect to any Investor, to the extent the Company has previously paid to such Investor an aggregate of Registration Delay
Payments in excess of ten percent (10%) the aggregate Purchase Price of such Investor and (ii) no Registration Delay Payments shall
be owed to any Investor that elects not to be named as an underwriter in a Registration Statement to the extent required by the
SEC.

 

3.Related
Obligations.

 

At such time as the Company
is obligated to file a Registration Statement with the SEC pursuant to Section 2(a), 2(b), 2(e) or 2(f), the Company will use its
reasonable best efforts to effect the registration of the Registrable Securities in accordance with the intended method of disposition
thereof and, pursuant thereto, the Company shall have the following obligations:

 

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(a)The Company
shall promptly prepare and file with the SEC a Registration Statement with respect to the Registrable Securities and use its reasonable
best efforts to cause such Registration Statement relating to the Registrable Securities to become effective as soon as practicable
after such filing (but in no event later than the Effectiveness Deadline). The Company shall keep each Registration Statement effective
pursuant to Rule 415 at all times until the earlier of (i) the date as of which the Investors may sell all of the Registrable Securities
covered by such Registration Statement without restriction or limitation pursuant to Rule 144 and without the requirement to be
in compliance with Rule 144(c)(1) (or any successor thereto) promulgated under the 1933 Act or (ii) the date on which the Investors
shall have sold all of the Registrable Securities covered by such Registration Statement (the "Registration Period").
The Company shall ensure that each Registration Statement (including any amendments or supplements thereto and prospectuses contained
therein) shall not contain any untrue statement of a material fact or omit to state a material fact required to be stated therein,
or necessary to make the statements therein (in the case of prospectuses, in the light of the circumstances in which they were
made) not misleading. The term "reasonable best efforts" shall mean, among other things, that the Company shall submit
to the SEC, within two (2) Business Days after the later of the date that (i) the Company learns that no review of a particular
Registration Statement will be made by the staff of the SEC or that the staff has no further comments on a particular Registration
Statement, as the case may be, and (ii) the approval of Legal Counsel pursuant to Section 3(c) (which approval is immediately sought),
a request for acceleration of effectiveness of such Registration Statement to a time and date not later than five (5) Business
Days after the Company is notified (orally or in writing, whichever is earlier) by the SEC that such Registration Statement will
not be reviewed or will not be subject to further review. The Company shall respond in writing to comments made by the SEC in respect
of a Registration Statement as soon as practicable, but in no event later than ten (10) Business Days after the receipt of comments
by or notice from the SEC that an amendment is required in order for a Registration Statement to be declared effective.

 

(b)The Company
shall prepare and file with the SEC such amendments (including post-effective amendments) and supplements to a Registration Statement
and the prospectus used in connection with such Registration Statement, which prospectus is to be filed pursuant to Rule 424 promulgated
under the 1933 Act, as may be necessary to keep such Registration Statement effective at all times during the Registration Period,
and, during such period, comply with the provisions of the 1933 Act with respect to the disposition of all Registrable Securities
of the Company covered by such Registration Statement until such time as all of such Registrable Securities shall have been disposed
of in accordance with the intended methods of disposition by the seller or sellers thereof as set forth in such Registration Statement.
In the case of amendments and supplements to a Registration Statement which are required to be filed pursuant to this Agreement
(including pursuant to this Section 3(b)) by reason of the Company filing a report on Form 10-K, Form 10-Q, Form 8-K or any analogous
report under the Securities Exchange Act of 1934, as amended (the "1934 Act"), the Company shall have incorporated
such report by reference into such Registration Statement, if applicable, or shall file such amendments or supplements with the
SEC on the same day on which the 1934 Act report is filed which created the requirement for the Company to amend or supplement
such Registration Statement.

 

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(c)The Company
shall (A) permit Legal Counsel to review and comment upon (i) a Registration Statement at least three (3) Business Days prior to
its filing with the SEC and (ii) all amendments and supplements to all Registration Statements (except for Annual Reports on Form
10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, and any similar or successor reports) within a reasonable number
of days prior to their filing with the SEC, and (B) not file any Registration Statement or amendment or supplement thereto in a
form to which Legal Counsel reasonably objects. The Company shall not submit a request for acceleration of the effectiveness of
a Registration Statement or any amendment or supplement thereto without the prior approval of Legal Counsel, which consent shall
not be unreasonably withheld delayed or conditioned; provided, however, that the Company shall not be liable for
any Registration Delay Payments that may arise under this Agreement if Legal Counsel does not permit the Company to request acceleration
of the effectiveness at such earlier time when the Company is otherwise able to make such request. The Company shall furnish to
Legal Counsel, without charge, (i) copies of any correspondence from the SEC or the staff of the SEC to the Company or its representatives
relating to any Registration Statement, (ii) promptly after the same is prepared and filed with the SEC, one copy of any Registration
Statement and any amendment(s) thereto, including financial statements and schedules, all documents incorporated therein by reference,
if requested by an Investor, and all exhibits and (iii) upon the effectiveness of any Registration Statement, one copy of the prospectus
included in such Registration Statement and all amendments and supplements thereto, except in cases (ii) and (iii) above if such
documents are filed with the SEC through EDGAR and are available to the public through the EDGAR system promptly after the same
is prepared and filed with the SEC. The Company shall reasonably cooperate with Legal Counsel in performing the Company's obligations
pursuant to this Section 3.

 

(d)The Company
shall furnish to each Investor whose Registrable Securities are included in any Registration Statement, without charge, unless
the following are filed with the SEC through EDGAR and are available to the public through the EDGAR system promptly after the
same is prepared and filed with the SEC (i) promptly after the same is prepared and filed with the SEC, at least one copy of such
Registration Statement and any amendment(s) thereto, including financial statements and schedules, all documents incorporated therein
by reference, if requested by an Investor, all exhibits and each preliminary prospectus, (ii) upon the effectiveness of any Registration
Statement, ten (10) copies of the prospectus included in such Registration Statement and all amendments and supplements thereto
(or such other number of copies as such Investor may reasonably request) and (iii) such other documents, including copies of any
preliminary or final prospectus, as such Investor may reasonably request from time to time in order to facilitate the disposition
of the Registrable Securities owned by such Investor.

 

(e)The Company
shall use its reasonable best efforts to (i) register and qualify, unless an exemption from registration and qualification applies,
the resale by Investors of the Registrable Securities covered by a Registration Statement under such other securities or "blue
sky" laws of all applicable jurisdictions in the United States, (ii) prepare and file in those jurisdictions such amendments
(including post-effective amendments) and supplements to such registrations and qualifications as may be necessary to maintain
the effectiveness thereof during the Registration Period, (iii) take such other actions as may be necessary to maintain such registrations
and qualifications in effect at all times during the Registration Period, and (iv) take all other actions reasonably necessary
or advisable to qualify the Registrable Securities for sale in such jurisdictions; provided, however, that the Company shall not
be required in connection therewith or as a condition thereto to (x) qualify to do business in any jurisdiction where it would
not otherwise be required to qualify but for this Section 3(e), (y) subject itself to general taxation in any such jurisdiction,
or (z) file a general consent to service of process in any such jurisdiction. The Company shall promptly notify Legal Counsel and
each Investor who holds Registrable Securities of the receipt by the Company of any notification with respect to the suspension
of the registration or qualification of any of the Registrable Securities for sale under the securities or "blue sky"
laws of any jurisdiction in the United States or its receipt of actual notice of the initiation or threatening of any proceeding
for such purpose.

 

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(f)The Company
shall notify Legal Counsel and each Investor in writing of the happening of any event, as promptly as practicable after becoming
aware of such event, as a result of which the prospectus included in a Registration Statement, as then in effect, includes an untrue
statement of a material fact or omission to state a material fact required to be stated therein or necessary to make the statements
therein, in the light of the circumstances under which they were made, not misleading (provided that in no event shall such notice
contain any material, nonpublic information), and, subject to Section 3(r), promptly prepare a supplement or amendment to such
Registration Statement to correct such untrue statement or omission, and, unless the following are filed with the SEC through EDGAR
and are available to the public through the EDGAR system promptly after the same is prepared and filed with the SEC, deliver ten
(10) copies of such supplement or amendment to Legal Counsel and each Investor (or such other number of copies as Legal Counsel
or such Investor may reasonably request). The Company shall also promptly notify Legal Counsel and each Investor in writing (i)
when a prospectus or any prospectus supplement or post-effective amendment has been filed, and when a Registration Statement or
any post-effective amendment has become effective (notification of such effectiveness shall be delivered to Legal Counsel and each
Investor by facsimile or email on the same day of such effectiveness and by overnight mail), (ii) of any request by the SEC for
amendments or supplements to a Registration Statement or related prospectus or related information, and (iii) of the Company's
reasonable determination that a post-effective amendment to a Registration Statement would be appropriate. By 9:30 a.m. New York
City time on the date following the date any post-effective amendment has become effective, the Company shall file with the SEC
in accordance with Rule 424 under the 1933 Act the final prospectus to be used in connection with sales pursuant to such Registration
Statement.

 

(g)The Company
shall use its reasonable best efforts to prevent the issuance of any stop order or other suspension of effectiveness of a Registration
Statement, or the suspension of the qualification of any of the Registrable Securities for sale in any jurisdiction and, if such
an order or suspension is issued, to obtain the withdrawal of such order or suspension at the earliest possible moment and to notify
Legal Counsel and each Investor who holds Registrable Securities being sold of the issuance of such order and the resolution thereof
or its receipt of actual notice of the initiation or threat of any proceeding for such purpose.

 

(h)If any Investor
is required under applicable securities laws to be described in the Registration Statement as an underwriter or an Investor believes
that it could reasonably be deemed to be an underwriter of Registrable Securities, at the reasonable request of such Investor,
the Company shall furnish to such Investor, on the date of the effectiveness of the Registration Statement and thereafter from
time to time on such dates as an Investor may reasonably request (i) a letter, dated such date, from the Company's independent
certified public accountants in form and substance as is customarily given by independent certified public accountants to underwriters
in an underwritten public offering, addressed to the Investors, and (ii) an opinion, dated as of such date, of counsel representing
the Company for purposes of such Registration Statement, in form, scope and substance as is customarily given in an underwritten
public offering, addressed to the Investors.

 

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(i)If any Investor
is required under applicable securities laws to be described in the Registration Statement as an underwriter or an Investor believes
that it could reasonably be deemed to be an underwriter of Registrable Securities, the Company shall make available for inspection
by (i) such Investor, (ii) Legal Counsel and (iii) one firm of accountants or other agents retained by the Investors (collectively,
the "Inspectors"), all pertinent financial and other records, and pertinent corporate documents and properties
of the Company (collectively, the "Records"), as shall be reasonably deemed necessary by each Inspector, and cause
the Company's officers, directors and employees to supply all information which any Inspector may reasonably request; provided,
however, that each Inspector shall agree to hold in strict confidence and shall not make any disclosure (except to an Investor)
or use of any Record or other information which the Company determines in good faith to be confidential, and of which determination
the Inspectors are so notified, unless (a) the disclosure of such Records is necessary to avoid or correct a misstatement or omission
in any Registration Statement or is otherwise required under the 1933 Act, (b) the release of such Records is ordered pursuant
to a final, non-appealable subpoena or order from a court or government body of competent jurisdiction, or (c) the information
in such Records has been made generally available to the public other than by disclosure in violation of this Agreement. Each Investor
agrees that it shall, upon learning that disclosure of such Records is sought in or by a court or governmental body of competent
jurisdiction or through other means, give prompt notice to the Company and allow the Company, at its expense, to undertake appropriate
action to prevent disclosure of, or to obtain a protective order for, the Records deemed confidential. Nothing herein (or in any
other confidentiality agreement between the Company and any Investor) shall be deemed to limit the Investors' ability to sell Registrable
Securities in a manner which is otherwise consistent with applicable laws and regulations.

 

(j)The Company
shall hold in confidence and not make any disclosure of information concerning an Investor provided to the Company unless (i) disclosure
of such information is necessary to comply with federal or state securities laws, (ii) the disclosure of such information is necessary
to avoid or correct a misstatement or omission in any Registration Statement, (iii) the release of such information is ordered
pursuant to a subpoena or other final, non-appealable order from a court or governmental body of competent jurisdiction, or (iv)
such information has been made generally available to the public other than by disclosure in violation of this Agreement or any
other agreement. The Company agrees that it shall, upon learning that disclosure of such information concerning an Investor is
sought in or by a court or governmental body of competent jurisdiction or through other means, give prompt written notice to such
Investor and allow such Investor, at the Investor's expense, to undertake appropriate action to prevent disclosure of, or to obtain
a protective order for, such information.

 

(k)The Company
shall use its reasonable best efforts to secure the inclusion for quotation of all of the Registrable Securities on the Principal
Market or, if the Common Stock is then no longer listed on the Principal Market, on such other Eligible Market on which the Common
Stock is then listed. The Company shall pay all fees and expenses in connection with satisfying its obligation under this Section
3(k).

 

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(l)The Company
shall cooperate with the Investors who hold Registrable Securities being offered and, to the extent applicable, facilitate the
timely preparation and delivery of certificates (not bearing any restrictive legend) representing the Registrable Securities to
be offered pursuant to a Registration Statement and enable such certificates to be in such denominations or amounts, as the case
may be, as the Investors may reasonably request and registered in such names as the Investors may request.

 

(m)If requested
by an Investor, the Company shall as soon as practicable (i) incorporate in a prospectus supplement or post-effective amendment
such information as an Investor reasonably requests to be included therein relating to the sale and distribution of Registrable
Securities, including, without limitation, information with respect to the number of Registrable Securities being offered or sold,
the purchase price being paid therefor and any other terms of the offering of the Registrable Securities to be sold in such offering;
(ii) make all required filings of such prospectus supplement or post-effective amendment after being notified of the matters to
be incorporated in such prospectus supplement or post-effective amendment; and (iii) supplement or make amendments to any Registration
Statement if reasonably requested by an Investor holding any Registrable Securities.

 

(n)The Company
shall use its reasonable best efforts to cause the Registrable Securities covered by a Registration Statement to be registered
with or approved by such other governmental agencies or authorities as may be necessary to consummate the disposition of such Registrable
Securities.

 

(o)The Company
shall make generally available to its security holders as soon as practical, but not later than ninety (90) days after the close
of the period covered thereby, an earnings statement (in form complying with, and in the manner provided by, the provisions of
Rule 158 under the 1933 Act) covering a twelve-month period beginning not later than the first day of the Company's fiscal quarter
next following the applicable Effective Date of a Registration Statement.

 

(p)The Company
shall otherwise use its reasonable best efforts to comply with all applicable rules and regulations of the SEC in connection with
any registration hereunder.

 

(q)Within two (2)
Business Days after a Registration Statement which covers Registrable Securities is ordered effective by the SEC, the Company shall
deliver, and shall cause legal counsel for the Company to deliver, to the transfer agent for such Registrable Securities (with
copies to the Investors whose Registrable Securities are included in such Registration Statement) confirmation that such Registration
Statement has been declared effective by the SEC.

 

    	11

    	 

    

 

(r)Notwithstanding
anything to the contrary herein, at any time after the Effective Date, (i) the Company may delay the disclosure of material, non-public
information concerning the Company the disclosure of which at the time is not, in the good faith opinion of the Board of Directors
of the Company and its counsel, in the best interest of the Company and, in the opinion of counsel to the Company, otherwise required
and (ii) the Company may suspend the availability of a Registration Statement on Form S-1 if pursuant to applicable law it must
file a post-effective amendment to such Registration Statement in connection with the filing of its Annual Report on Form 10-K
or Quarterly Reports on Form 10-Q (each, a "Grace Period"); provided, that the Company shall promptly (i) notify
the Investors in writing of the existence of material, non-public information giving rise to a Grace Period (provided that in each
notice the Company will not disclose the content of such material, non-public information to the Investors) and the date on which
each Grace Period will begin, and (ii) notify the Investors in writing of the date on which each Grace Period ends; and, provided
further, that no Grace Period shall exceed fifteen (15) consecutive Trading Days and during any three hundred sixty five (365)
day period such Grace Periods shall not exceed an aggregate of sixty (60) Trading Days and the first day of any Grace Period must
be at least five (5) Trading Days after the last day of any prior Grace Period (each, an "Allowable Grace Period").
For purposes of determining the length of a Grace Period above, the Grace Period shall begin on and include the date the Investors
receive the notice referred to in clause (i) and shall end on and include the later of the date the Investors receive the notice
referred to in clause (ii) and the date referred to in such notice. The provisions of Section 3(g) hereof shall not be applicable
during the period of any Allowable Grace Period. Upon expiration of the Grace Period, the Company shall again be bound by the first
sentence of Section 3(f) with respect to the information giving rise thereto unless such material, non-public information is no
longer applicable. Notwithstanding anything to the contrary, the Company shall cause its transfer agent to deliver unlegended shares
of Common Stock to a transferee of an Investor in accordance with the terms of the Securities Purchase Agreement in connection
with any sale of Registrable Securities pursuant to an effective Registration Statement with respect to which an Investor has entered
into a contract for sale, prior to the Investor's receipt of the notice of a Grace Period and for which the Investor has not yet
settled.

 

(s)Neither the
Company nor any Subsidiary or affiliate thereof shall identify any Investor as an underwriter in any public disclosure or filing
with the SEC, the Principal Market or any Eligible Market and any Buyer being deemed an underwriter by the SEC shall not relieve
the Company of any obligations it has under this Agreement or any other Transaction Document (as defined in the Securities Purchase
Agreement); provided, however, that the foregoing shall not prohibit the Company from including the disclosure found
in the "Plan of Distribution" section attached hereto as Exhibit A in the Registration Statement.

(t)Other than the
current holders of the Company's securities which have the benefit of registration rights as disclosed in the SEC Documents (as
defined in the Securities Purchase Agreement) from whom the Company has obtained waivers on or prior to the Closing Date, neither
the Company nor any of its Subsidiaries has entered, as of the date hereof, nor shall the Company or any of its Subsidiaries, on
or after the date of this Agreement, enter into any agreement with respect to its securities, that would have the effect of impairing
the rights granted to the Buyers in this Agreement or otherwise conflicts with the provisions hereof.

 

4.Obligations
of the Investors.

 

(a)At least five
(5) Business Days prior to the first anticipated Filing Date of a Registration Statement, the Company shall notify each Investor
in writing of the information the Company requires from each such Investor if such Investor elects to have any of such Investor's
Registrable Securities included in such Registration Statement. It shall be a condition precedent to the obligations of the Company
to complete any registration pursuant to this Agreement with respect to the Registrable Securities of a particular Investor that
such Investor shall furnish to the Company such information regarding itself, the Registrable Securities held by it and the intended
method of disposition of the Registrable Securities held by it as shall be reasonably required to effect within five (5) Business
Days and maintain the effectiveness of the registration of such Registrable Securities and shall execute such documents in connection
with such registration as the Company may reasonably request.

 

    	12

    	 

    

 

(b)Each Investor,
by such Investor's acceptance of the Registrable Securities, agrees to cooperate with the Company as reasonably requested by the
Company in connection with the preparation and filing of any Registration Statement hereunder, unless such Investor has notified
the Company in writing of such Investor's election to exclude all of such Investor's Registrable Securities from such Registration
Statement.

 

(c)Each Investor
agrees that, upon receipt of any notice from the Company of the happening of any event of the kind described in Section 3(g) or
the first sentence of 3(f), such Investor will immediately discontinue disposition of Registrable Securities pursuant to any Registration
Statement(s) covering such Registrable Securities until such Investor's receipt of copies of the supplemented or amended prospectus
as contemplated by Section 3(g) or the first sentence of 3(f) or receipt of notice that no supplement or amendment is required.
Notwithstanding anything to the contrary, the Company shall cause its transfer agent to deliver unlegended shares of Common Stock
to a transferee of an Investor in accordance with the terms of the Securities Purchase Agreement in connection with any sale of
Registrable Securities with respect to which an Investor has entered into a contract for sale prior to the Investor's receipt of
a notice from the Company of the happening of any event of the kind described in Section 3(g) or the first sentence of 3(f) and
for which the Investor has not yet settled.

 

(d)Each Investor
covenants and agrees that it will comply with the prospectus delivery requirements of the 1933 Act as applicable to it or an exemption
therefrom in connection with sales of Registrable Securities pursuant to the Registration Statement.

 

5.Expenses of
Registration.

 

All reasonable expenses,
other than underwriting discounts and commissions, incurred in connection with registrations, filings or qualifications pursuant
to Sections 2 and 3, including, without limitation, all registration, listing and qualifications fees, printers and accounting
fees, and fees and disbursements of counsel for the Company shall be paid by the Company. The Company shall also reimburse the
Investors for one-half of the reasonable and documented fees and disbursements of Legal Counsel in connection with registration,
filing or qualification pursuant to Sections 2 and 3 of this Agreement in an amount up to $5,000.

 

6.Indemnification.

 

In the event any Registrable
Securities are included in a Registration Statement under this Agreement:

 

    	13

    	 

    

 

(a)To the fullest
extent permitted by law, the Company will, and hereby does, indemnify, hold harmless and defend each Investor, the directors, officers,
partners, members, employees, agents, representatives of, and each Person, if any, who controls any Investor within the meaning
of the 1933 Act or the 1934 Act (each, an "Indemnified Person"), against any losses, claims, damages, liabilities,
judgments, fines, penalties, charges, costs, reasonable and documented attorneys' fees, amounts paid in settlement or expenses,
joint or several (collectively, "Claims"), incurred in investigating, preparing or defending any action, claim,
suit, inquiry, proceeding, investigation or appeal taken from the foregoing by or before any court or governmental, administrative
or other regulatory agency, body or the SEC, whether pending or threatened, whether or not an indemnified party is or may be a
party thereto ("Indemnified Damages"), to which any of them may become subject insofar as such Claims (or actions
or proceedings, whether commenced or threatened, in respect thereof) arise out of or are based upon: (i) any untrue statement or
alleged untrue statement of a material fact in a Registration Statement or any post-effective amendment thereto or in any filing
made in connection with the qualification of the offering under the securities or other "blue sky" laws of any jurisdiction
in which Registrable Securities are offered ("Blue Sky Filing"), or the omission or alleged omission to state
a material fact required to be stated therein or necessary to make the statements therein not misleading, (ii) any untrue statement
or alleged untrue statement of a material fact contained in any preliminary prospectus if used prior to the effective date of such
Registration Statement, or contained in the final prospectus (as amended or supplemented, if the Company files any amendment thereof
or supplement thereto with the SEC) or the omission or alleged omission to state therein any material fact necessary to make the
statements made therein, in light of the circumstances under which the statements therein were made, not misleading, (iii) any
violation or alleged violation by the Company of the 1933 Act, the 1934 Act, any other law, including, without limitation, any
state securities law, or any rule or regulation thereunder relating to the offer or sale of the Registrable Securities pursuant
to a Registration Statement or (iv) any violation of this Agreement (the matters in the foregoing clauses (i) through (iv) being,
collectively, "Violations"). Subject to Section 6(c), the Company shall reimburse the Indemnified Persons, promptly
as such expenses are incurred and are due and payable, for any reasonable and documented legal fees or other reasonable expenses
incurred by them in connection with investigating or defending any such Claim. Notwithstanding anything to the contrary contained
herein, the indemnification agreement contained in this Section 6(a): (i) shall not apply to a Claim by an Indemnified Person arising
out of or based upon a Violation which occurs in reliance upon and in conformity with information furnished in writing to the Company
by such Indemnified Person for such Indemnified Person expressly for use in connection with the preparation of the Registration
Statement or any such amendment thereof or supplement thereto, if such prospectus was timely made available by the Company pursuant
to Section 3(d); and (ii) shall not apply to amounts paid in settlement of any Claim if such settlement is effected without the
prior written consent of the Company, which consent shall not be unreasonably withheld or delayed. Such indemnity shall remain
in full force and effect regardless of any investigation made by or on behalf of the Indemnified Person and shall survive the transfer
of the Registrable Securities by the Investors pursuant to Section 9.

 

    	14

    	 

    

 

(b)In connection
with any Registration Statement in which an Investor is participating, each such Investor agrees to severally and not jointly indemnify,
hold harmless and defend, to the same extent and in the same manner as is set forth in Section 6(a), the Company, each of its directors,
each of its officers who signs the Registration Statement and each Person, if any, who controls the Company within the meaning
of the 1933 Act or the 1934 Act (each, an "Indemnified Party"), against any Claim or Indemnified Damages to which
any of them may become subject, under the 1933 Act, the 1934 Act or otherwise, insofar as such Claim or Indemnified Damages arise
out of or are based upon any Violation, in each case to the extent, and only to the extent, that such Violation occurs in reliance
upon and in conformity with written information furnished to the Company by such Investor expressly for use in connection with
such Registration Statement; and, subject to Section 6(c), such Investor shall reimburse the Indemnified Party for any legal or
other expenses reasonably incurred by an Indemnified Party in connection with investigating or defending any such Claim; provided,
however, that the indemnity agreement contained in this Section 6(b) and the agreement with respect to contribution contained in
Section 7 shall not apply to amounts paid in settlement of any Claim if such settlement is effected without the prior written consent
of such Investor, which consent shall not be unreasonably withheld or delayed; provided, further, however, that the Investor shall
be liable under this Section 6(b) for only that amount of a Claim or Indemnified Damages as does not exceed the net proceeds to
such Investor as a result of the sale of Registrable Securities pursuant to such Registration Statement. Such indemnity shall remain
in full force and effect regardless of any investigation made by or on behalf of such Indemnified Party and shall survive the transfer
of the Registrable Securities by the Investors pursuant to Section 9.

 

(c)Promptly after
receipt by an Indemnified Person or Indemnified Party under this Section 6 of notice of the commencement of any action or proceeding
(including any governmental action or proceeding) involving a Claim, such Indemnified Person or Indemnified Party shall, if a Claim
in respect thereof is to be made against any indemnifying party under this Section 6, deliver to the indemnifying party a written
notice of the commencement thereof, and the indemnifying party shall have the right to participate in, and, to the extent the indemnifying
party so desires, jointly with any other indemnifying party similarly noticed, to assume control of the defense thereof with counsel
mutually satisfactory to the indemnifying party and the Indemnified Person or the Indemnified Party, as the case may be; provided,
however, that an Indemnified Person or Indemnified Party shall have the right to retain its own counsel with the fees and expenses
of not more than one counsel for all such Indemnified Person or Indemnified Party to be paid by the indemnifying party, if, in
the reasonable opinion of counsel retained by the Indemnified Person or Indemnified Party, as applicable, the representation by
such counsel of the Indemnified Person or Indemnified Party and the indemnifying party would be inappropriate due to actual or
potential differing interests between such Indemnified Person or Indemnified Party and any other party represented by such counsel
in such proceeding. In the case of an Indemnified Person, legal counsel referred to in the immediately preceding sentence shall
be selected by the Investors holding at least a majority in interest of the Registrable Securities included in the Registration
Statement to which the Claim relates. The Indemnified Party or Indemnified Person shall reasonably cooperate with the indemnifying
party in connection with any negotiation or defense of any such action or Claim by the indemnifying party and shall furnish to
the indemnifying party all information reasonably available to the Indemnified Party or Indemnified Person which relates to such
action or Claim. The indemnifying party shall keep the Indemnified Party or Indemnified Person fully apprised at all times as to
the status of the defense or any settlement negotiations with respect thereto. No indemnifying party shall be liable for any settlement
of any action, claim or proceeding effected without its prior written consent, provided, however, that the indemnifying party shall
not unreasonably withhold, delay or condition its consent. No indemnifying party shall, without the prior written consent of the
Indemnified Party or Indemnified Person, consent to entry of any judgment or enter into any settlement or other compromise which
does not include as an unconditional term thereof the giving by the claimant or plaintiff to such Indemnified Party or Indemnified
Person of a release from all liability in respect to such Claim or litigation and such settlement shall not include any admission
as to fault on the part of the Indemnified Party. Following indemnification as provided for hereunder, the indemnifying party shall
be subrogated to all rights of the Indemnified Party or Indemnified Person with respect to all third parties, firms or corporations
relating to the matter for which indemnification has been made. The failure to deliver written notice to the indemnifying party
within a reasonable time of the commencement of any such action shall not relieve such indemnifying party of any liability to the
Indemnified Person or Indemnified Party under this Section 6, except to the extent that the indemnifying party is prejudiced in
its ability to defend such action.

 

    	15

    	 

    

 

(d)The indemnification
required by this Section 6 shall be made by periodic payments of the amount thereof during the course of the investigation or defense,
as and when bills are received or Indemnified Damages are incurred.

 

(e)The indemnity
agreements contained herein shall be in addition to (i) any cause of action or similar right of the Indemnified Party or Indemnified
Person against the indemnifying party or others, and (ii) any liabilities the indemnifying party may be subject to pursuant to
the law.

 

7.Contribution.

 

To the extent any indemnification
by an indemnifying party is prohibited or limited by law, the indemnifying party agrees to make the maximum contribution with respect
to any amounts for which it would otherwise be liable under Section 6 to the fullest extent permitted by law; provided, however,
that: (i) no Person involved in the sale of Registrable Securities which Person is guilty of fraudulent misrepresentation (within
the meaning of Section 11(f) of the 1933 Act) in connection with such sale shall be entitled to contribution from any Person involved
in such sale of Registrable Securities who was not guilty of fraudulent misrepresentation; and (ii) contribution by any seller
of Registrable Securities shall be limited in amount to the amount of net proceeds received by such seller from the sale of such
Registrable Securities pursuant to such Registration Statement.

 

8.Reports Under
the 1934 Act.

 

With a view to making
available to the Investors the benefits of Rule 144 promulgated under the 1933 Act or any other similar rule or regulation of the
SEC that may at any time permit the Investors to sell securities of the Company to the public without registration ("Rule
144"), the Company agrees to:

 

(a)make and keep
public information available, as those terms are understood and defined in Rule 144;

 

(b)file with the
SEC in a timely manner all reports and other documents required of the Company under the 1933 Act and the 1934 Act so long as the
Company remains subject to such requirements and the filing of such reports and other documents is required for the applicable
provisions of Rule 144; and

 

    	16

    	 

    

 

(c)furnish to each
Investor so long as such Investor owns Registrable Securities, as soon as reasonably practicable upon request, (i) a written statement
by the Company, if true, that it has complied with the reporting requirements of Rule 144, the 1933 Act and the 1934 Act, (ii)
a copy of the most recent annual or quarterly report of the Company and such other reports and documents so filed by the Company,
and (iii) such other information as may be reasonably requested to permit the Investors to sell such securities pursuant to Rule
144 without registration.

 

9.Assignment of
Registration Rights.

 

The rights under this
Agreement shall be automatically assignable by the Investors to any transferee of all or any portion of such Investor's Registrable
Securities if: (i) the Investor agrees in writing with the transferee or assignee to assign such rights, and a copy of such agreement
is furnished to the Company within a reasonable time after such assignment; (ii) the Company is, within a reasonable time after
such transfer or assignment, furnished with written notice of (a) the name and address of such transferee or assignee, and (b)
the securities with respect to which such registration rights are being transferred or assigned; (iii) immediately following such
transfer or assignment the further disposition of such securities by the transferee or assignee is restricted under the 1933 Act
or applicable state securities laws; (iv) at or before the time the Company receives the written notice contemplated by clause
(ii) of this sentence the transferee or assignee agrees in writing with the Company to be bound by all of the provisions contained
herein; and (v) such transfer shall have been made in accordance with the applicable requirements of the Securities Purchase Agreement.

 

10.Amendment of
Registration Rights.

 

Provisions of this Agreement
may be amended and the observance thereof may be waived (either generally or in a particular instance and either retroactively
or prospectively), only with the written consent of the Company and the Required Holders; provided that any such amendment or waiver
that complies with the foregoing but that disproportionately, materially and adversely affects the rights and obligations of any
Investor relative to the comparable rights and obligations of the other Investors shall require the prior written consent of such
adversely affected Investor. Any amendment or waiver effected in accordance with this Section 10 shall be binding upon each Investor
and the Company. No such amendment shall be effective to the extent that it applies to less than all of the holders of the Registrable
Securities. No consideration shall be offered or paid to any Person to amend or consent to a waiver or modification of any provision
of this Agreement unless the same consideration (other than the reimbursement of reasonable and documented legal fees) also is
offered to all of the parties to this Agreement.

 

11.Miscellaneous.

 

(a)A Person is
deemed to be a holder of Registrable Securities whenever such Person owns or is deemed to own of record such Registrable Securities.
If the Company receives conflicting instructions, notices or elections from two or more Persons with respect to the same Registrable
Securities, the Company shall act upon the basis of instructions, notice or election received from such record owner of such Registrable
Securities.

 

    	17

    	 

    

 

(b)Any notices,
consents, waivers or other communications required or permitted to be given under the terms of this Agreement must be in writing
and will be deemed to have been delivered: (i) upon receipt, when delivered personally; (ii) upon receipt, when sent by facsimile
(provided confirmation of transmission is mechanically or electronically generated and kept on file by the sending party); (iii)
when sent, if sent by electronic mail; or (iv) one Business Day after deposit with a nationally recognized overnight delivery service,
in each case properly addressed to the party to receive the same. The addresses, facsimile numbers and email addresses for such
communications shall be:

 

If to the Company:

 

	Enerpulse Technologies, Inc.
	2451 Alamo Ave SE
	Albuquerque, New Mexico 87106
	Telephone:	(505) 842-5201
	Facsimile:	(505) 213-0013
	Attention:	Bryan Templeton,
		Chief Financial Officer
	Email:	btempleton@enerpulse.com

 

 

With a copy (for informational
purposes only) to:

 

	Greenberg Traurig, LLP
	1201 K. Street,
	Suite 2100	 
	Sacramento, CA 95814
	Telephone:	(916) 442-1111
	Facsimile:	(916) 448-1709
	Attention:	Mark C. Lee, Esq.
	Email:	leema@gtlaw.com

 

If to the Transfer Agent:

 

	Securities Transfer Corporation
	2591 Dallas Parkway, Suite 102
	Frisco, Texas 75034
	Telephone:	469-633-0101 ext. 109
	Facsimile:	469-633-0088
	Attention:	Christina Shelton,
	 	Original Issuance Dept.
	E-mail:	shelton@stctransfer.com

 

    	18

    	 

    

 

If to Legal Counsel:

 

	Schulte Roth & Zabel LLP
	919 Third Avenue
	New York, New York  10022
	Telephone:	(212) 756-2000
	Facsimile:	(212) 593-5955
	Attention:	Eleazer Klein, Esq.
	Email:	eleazer.klein@srz.com

 

If to a Buyer, to its address, facsimile
number and/or email address set forth on the Schedule of Buyers attached hereto, with copies to such Buyer's representatives as
set forth on the Schedule of Buyers, or to such other address, facsimile number and/or email address to the attention of such other
Person as the recipient party has specified by written notice given to each other party five (5) days prior to the effectiveness
of such change. Written confirmation of receipt (A) given by the recipient of such notice, consent, waiver or other communication,
(B) mechanically or electronically generated by the sender's facsimile machine or email containing the time, date, recipient facsimile
number and an image of the first page of such transmission or (C) provided by a courier or overnight courier service shall be rebuttable
evidence of personal service, receipt by facsimile or receipt from a nationally recognized overnight delivery service in accordance
with clause (i), (ii) or (iii) above, respectively.

 

(c)Failure of any
party to exercise any right or remedy under this Agreement or otherwise, or delay by a party in exercising such right or remedy,
shall not operate as a waiver thereof.

 

(d)All questions
concerning the construction, validity, enforcement and interpretation of this Agreement shall be governed by the internal laws
of the State of New York, without giving effect to any choice of law or conflict of law provision or rule (whether of the State
of New York or any other jurisdictions) that would cause the application of the laws of any jurisdictions other than the State
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, and hereby irrevocably waives, and agrees not to assert in any suit, action or proceeding,
any claim that it is not personally subject to the jurisdiction of any such court, that such suit, action or proceeding is brought
in an inconvenient forum or that the venue of such suit, action or proceeding is improper. Each party hereby irrevocably waives
personal service of process and consents to process being served in any such suit, action or proceeding by mailing a copy thereof
to such party at the address for such 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 manner permitted by law. EACH PARTY HEREBY IRREVOCABLY WAIVES ANY RIGHT IT MAY HAVE, AND AGREES NOT TO REQUEST,
A JURY TRIAL FOR THE ADJUDICATION OF ANY DISPUTE HEREUNDER OR IN CONNECTION HEREWITH OR ARISING OUT OF THIS AGREEMENT OR ANY TRANSACTION
CONTEMPLATED HEREBY.

 

    	19

    	 

    

 

(e)If any provision
of this Agreement is prohibited by law or otherwise determined to be invalid or unenforceable by a court of competent jurisdiction,
the provision that would otherwise be prohibited, invalid or unenforceable shall be deemed amended to apply to the broadest extent
that it would be valid and enforceable, and the invalidity or unenforceability of such provision shall not affect the validity
of the remaining provisions of this Agreement so long as this Agreement as so modified continues to express, without material change,
the original intentions of the parties as to the subject matter hereof and the prohibited nature, invalidity or unenforceability
of the provision(s) in question does not substantially impair the respective expectations or reciprocal obligations of the parties
or the practical realization of the benefits that would otherwise be conferred upon the parties. The parties will endeavor in good
faith negotiations to replace the prohibited, invalid or unenforceable provision(s) with a valid provision(s), the effect of which
comes as close as possible to that of the prohibited, invalid or unenforceable provision(s).

 

(f)This Agreement,
the other Transaction Documents (as defined in the Securities Purchase Agreement) and the instruments referenced herein and therein
constitute the entire agreement among the parties hereto with respect to the subject matter hereof and thereof. There are no restrictions,
promises, warranties or undertakings, other than those set forth or referred to herein and therein. This Agreement, the other Transaction
Documents and the instruments referenced herein and therein supersede all prior agreements and understandings among the parties
hereto with respect to the subject matter hereof and thereof.

 

(g)Subject to the
requirements of Section 9, this Agreement shall inure to the benefit of and be binding upon the permitted successors and assigns
of each of the parties hereto.

 

(h)The headings
in this Agreement are for convenience of reference only and shall not limit or otherwise affect the meaning hereof.

 

(i)This Agreement
may be executed in identical counterparts, each of which shall be deemed an original but all of which shall constitute one and
the same agreement. This Agreement, once executed by a party, may be delivered to the other party hereto by facsimile transmission
of a copy of this Agreement bearing the signature of the party so delivering this Agreement.

 

(j)Each party shall
do and perform, or cause to be done and performed, all such further acts and things, and shall execute and deliver all such other
agreements, certificates, instruments and documents, as any other party may reasonably request in order to carry out the intent
and accomplish the purposes of this Agreement and the consummation of the transactions contemplated hereby.

 

(k)All consents
and other determinations required to be made by the Investors pursuant to this Agreement shall be made, unless otherwise specified
in this Agreement, by the Required Holders, determined as if all of the outstanding Notes then held by the Investors have been
converted for Registrable Securities without regard to any limitations on redemption, amortization and/or conversion of the Notes
and the outstanding Warrants and Roth Warrants then held by Investors have been exercised for Registrable Securities without regard
to any limitations on exercise of the Warrants or the Roth Warrants.

 

    	20

    	 

    

 

(l)The language
used in this Agreement will be deemed to be the language chosen by the parties to express their mutual intent and no rules of strict
construction will be applied against any party.

 

(m)This Agreement
is intended for the benefit of the parties hereto and their respective permitted successors and assigns, and is not for the benefit
of, nor may any provision hereof be enforced by, any other Person.

 

(n)The obligations
of each Investor hereunder are several and not joint with the obligations of any other Investor, and no provision of this Agreement
is intended to confer any obligations on any Investor vis-à-vis any other Investor. Nothing contained herein, and no action
taken by any Investor pursuant hereto, shall be deemed to constitute the Investors as a partnership, an association, a joint venture
or any other kind of entity, or create a presumption that the Investors are in any way acting in concert or as a group with respect
to such obligations or the transactions contemplated herein.

 

* * * * * *

 

[Signature Page Follows]

 

 

    	21

    	 

    

 

IN WITNESS WHEREOF,
each Buyer and the Company have caused their respective signature page to this Registration Rights Agreement to be duly executed
as of the date first written above.

 

	 	COMPANY:
	 	 	 
	 	ENERPULSE TECHNOLOGIES, INC.  
	 	 	 
	 	By:	 
	 	 	Name:
	 	 	Title:   

 

    	 

    	 

    

 

IN WITNESS WHEREOF,
each Buyer and the Company have caused their respective signature page to this Registration Rights Agreement to be duly executed
as of the date first written above.

 

	 	BUYERS:
	 	 	 
	 	[___________]
	 	 	 
	 	By:   	 
	 	 	 
	 	By:  	
	 	 	Name:
	 	 	Title: 

 

    	 

    	 

    

 

SCHEDULE OF BUYERS

 

	
         

        Buyer
	Buyer Address

and Facsimile Number	Buyer's Representative's Address 

and Facsimile Number
	 	 	 
	 

                                [__________]
	
        [_____________]

        [_____________]

        [_____________]

        Attention: [_____________]

        Facsimile: [_____________]

        Telephone: [_____________]

        E-mail: [_____________]

        

        
	 

 

    	 

    	 

    

 

EXHIBIT A

SELLING SHAREHOLDERS

 

The shares of common
stock being offered by the selling shareholders are those issuable to the selling shareholders pursuant to the terms of the convertible
notes and upon exercise of the warrants (including, without limitation, the Roth Warrants). For additional information regarding
the issuance of those convertible notes and warrants, see "Private Placement of Convertible Notes and Warrants" above.
We are registering the shares of common stock in order to permit the selling shareholders to offer the shares for resale from time
to time. Except for the ownership of the convertible notes and the warrants issued pursuant to the Securities Purchase Agreement,
the selling shareholders have not had any material relationship with us within the past three years.

 

The table below lists
the selling shareholders and other information regarding the beneficial ownership of the shares of common stock by each of the
selling shareholders. The second column lists the number of shares of common stock beneficially owned by each selling shareholder,
based on its ownership of the convertible notes and warrants, as of ________, 2015, assuming conversion of all convertible notes
and exercise of all warrants held by the selling shareholders on that date, without regard to any limitations on conversion, redemption
or exercise.

 

The third column lists
the shares of common stock being offered by this prospectus by the selling shareholders.

 

In accordance with
the terms of a registration rights agreement with the selling shareholders, this prospectus generally covers the resale of at least
125% of the sum of (i) the maximum number of shares of common stock issued and issuable pursuant to the convertible notes as of
the Trading Day immediately preceding the date the registration statement is initially filed with the SEC, and (ii) the maximum
number of shares of common stock issued and issuable upon exercise of the related warrants (including, without limitation, the
Roth Warrants) as of the Trading Day immediately preceding the date the registration statement is initially filed with the SEC.
Because the conversion price of the convertible notes and the exercise price of the warrants may be adjusted, the number of
shares that will actually be issued may be more or less than the number of shares being offered by this prospectus. The fourth
column assumes the sale of all of the shares offered by the selling shareholders pursuant to this prospectus.

 

Under the terms of
the convertible notes and the warrants, a selling shareholder may not convert the convertible notes or exercise the warrants to
the extent such conversion or exercise would cause such selling shareholder, together with its affiliates, to beneficially own
a number of shares of common stock which would exceed 9.99% of our then outstanding shares of common stock following such conversion
or exercise, excluding for purposes of such determination shares of common stock issuable upon conversion of the convertible notes
which have not been converted and upon exercise of the warrants which have not been exercised. The number of shares in the second
column does not reflect this limitation. The selling shareholders may sell all, some or none of their shares in this offering.
See "Plan of Distribution."

 

    	Annex I -1

    	 

    

 

	
         

        

        

        Name of Selling Shareholder
	
        

        Number of Shares of Common Stock Owned
        Prior to Offering
	
         

        Maximum Number of Shares of Common
        Stock to be Sold Pursuant to this Prospectus
	
         

        Number of Shares of Common Stock Owned
        After Offering

	 

                                                     [_____________]
	
         

         
	 	0

 

 

    	Annex I -2

    	 

    

 

PLAN OF DISTRIBUTION

 

We are registering
the shares of common stock issuable pursuant to the terms of the convertible notes and upon exercise of the warrants (including,
without limitation, the Roth Warrants) to permit the resale of these shares of common stock by the holders of the convertible notes
and warrants from time to time after the date of this prospectus. We will not receive any of the proceeds from the sale by the
selling shareholders of the shares of common stock. We will bear all fees and expenses incident to our obligation to register the
shares of common stock.

 

The selling shareholders
may sell all or a portion of the shares of common stock beneficially owned by them and offered hereby from time to time directly
or through one or more underwriters, broker-dealers or agents. If the shares of common stock are sold through underwriters or
broker-dealers, the selling shareholders will be responsible for underwriting discounts or commissions or agent's commissions.
The shares of common stock may be sold in one or more transactions at fixed prices, at prevailing market prices at the time of
the sale, at varying prices determined at the time of sale, or at negotiated prices. These sales may be effected in transactions,
which may involve crosses or block transactions,

 

		·	on any national securities exchange or quotation service on which the securities may be listed
or quoted at the time of sale;

 

		·	in the over-the-counter market;

 

		·	in transactions otherwise than on these exchanges or systems or in the over-the-counter market;

 

		·	through the writing of options, whether such options are listed on an options exchange or otherwise;

 

		·	ordinary brokerage transactions and transactions in which the broker-dealer solicits purchasers;

 

		·	block trades in which the broker-dealer will attempt to sell the shares as agent but may position
and resell a portion of the block as principal to facilitate the transaction;

 

		·	purchases by a broker-dealer as principal and resale by the broker-dealer for its account;

 

		·	an exchange distribution in accordance with the rules of the applicable exchange;

 

		·	privately negotiated transactions;

 

		·	short sales;

 

		·	sales pursuant to Rule 144;

 

		·	broker-dealers may agree with the selling securityholders to sell a specified number of such shares
at a stipulated price per share;

 

    	Annex I - 3

    	 

    

 

		·	a combination of any such methods of sale; and

 

		·	any other method permitted pursuant to applicable law.

 

The selling shareholders
may also sell shares of common stock under Rule 144 promulgated under the Securities Act of 1933, as amended, if available, rather
than under this prospectus. In addition, the selling shareholders may transfer the shares of common stock by other means not described
in this prospectus. If the selling shareholders effect such transactions by selling shares of common stock to or through underwriters,
broker-dealers or agents, such underwriters, broker-dealers or agents may receive commissions in the form of discounts, concessions
or commissions from the selling shareholders or commissions from purchasers of the shares of common stock for whom they may act
as agent or to whom they may sell as principal (which discounts, concessions or commissions as to particular underwriters, broker-dealers
or agents may be in excess of those customary in the types of transactions involved). In connection with sales of the shares of
common stock or otherwise, the selling shareholders may enter into hedging transactions with broker-dealers, which may in turn
engage in short sales of the shares of common stock in the course of hedging in positions they assume. The selling shareholders
may also sell shares of common stock short and deliver shares of common stock covered by this prospectus to close out short positions
and to return borrowed shares in connection with such short sales. The selling shareholders may also loan or pledge shares of common
stock to broker-dealers that in turn may sell such shares.

 

The selling shareholders
may pledge or grant a security interest in some or all of the convertible notes, warrants or shares of common stock owned by them
and, if they default in the performance of their secured obligations, the pledgees or secured parties may offer and sell the shares
of common stock from time to time pursuant to this prospectus or any amendment to this prospectus under Rule 424(b)(3) or other
applicable provision of the Securities Act of 1933, as amended, amending, if necessary, the list of selling shareholders to include
the pledgee, transferee or other successors in interest as selling shareholders under this prospectus. The selling shareholders
also may transfer and donate the shares of common stock in other circumstances in which case the transferees, donees, pledgees
or other successors in interest will be the selling beneficial owners for purposes of this prospectus.

 

To the extent required
by the Securities Act and the rules and regulations thereunder, the selling shareholders and any broker-dealer participating in
the distribution of the shares of common stock may be deemed to be "underwriters" within the meaning of the Securities
Act, and any commission paid, or any discounts or concessions allowed to, any such broker-dealer may be deemed to be underwriting
commissions or discounts under the Securities Act. At the time a particular offering of the shares of common stock is made, a prospectus
supplement, if required, will be distributed which will set forth the aggregate amount of shares of common stock being offered
and the terms of the offering, including the name or names of any broker-dealers or agents, any discounts, commissions and other
terms constituting compensation from the selling shareholders and any discounts, commissions or concessions allowed or reallowed
or paid to broker-dealers. Each selling shareholder has informed us that it does not have any written or oral agreement or understanding,
directly or indirectly, with any person to distribute the shares of common stock. In no event shall any broker-dealer receive fees,
commissions and markups which, in the aggregate, would exceed eight percent (8%).

 

    	Annex I -4

    	 

    

 

There can be no assurance
that any selling shareholder will sell any or all of the shares of common stock registered pursuant to the registration statement,
of which this prospectus forms a part.

 

The selling shareholders
and any other person participating in such distribution will be subject to applicable provisions of the Securities Exchange Act
of 1934, as amended, and the rules and regulations thereunder, including, without limitation, Regulation M of the Exchange Act,
which may limit the timing of purchases and sales of any of the shares of common stock by the selling shareholders and any other
participating person. Regulation M may also restrict the ability of any person engaged in the distribution of the shares of common
stock to engage in market-making activities with respect to the shares of common stock. All of the foregoing may affect the marketability
of the shares of common stock and the ability of any person or entity to engage in market-making activities with respect to the
shares of common stock.

 

We will pay all expenses
of the registration of the shares of common stock pursuant to the registration rights agreement, estimated to be $[     ]
in total, including, without limitation, Securities and Exchange Commission filing fees and expenses of compliance with state securities
or "blue sky" laws; provided, however, that a selling shareholder will pay all underwriting discounts and selling commissions,
if any. We will indemnify the selling shareholders against liabilities, including some liabilities under the Securities Act, in
accordance with the registration rights agreements, or the selling shareholders will be entitled to contribution. We may be indemnified
by the selling shareholders against civil liabilities, including liabilities under the Securities Act, that may arise from any
written information furnished to us by the selling shareholder specifically for use in this prospectus, in accordance with the
related registration rights agreement, or we may be entitled to contribution.

 

We agreed to keep this
prospectus effective until the earlier of (i) the date on which the shares may be resold by the selling shareholders without registration
and without regard to any volume or manner-of-sale limitations by reason of Rule 144, without the requirement for us to be in compliance
with the current public information under Rule 144 under the Securities Act or any other rule of similar effect or (ii) all of
the shares have been sold pursuant to this prospectus or Rule 144 under the Securities Act or any other rule of similar effect.
The resale shares will be sold only through registered or licensed brokers or dealers if required under applicable state securities
laws. In addition, in certain states, the resale shares of common stock covered hereby may not be sold unless they have been registered
or qualified for sale in the applicable state or an exemption from the registration or qualification requirement is available and
is complied with.

 

Once sold under the
registration statement, of which this prospectus forms a part, the shares of common stock will be freely tradable in the hands
of persons other than our affiliates.

 

    	Annex I - 5Exhibit 10.3 

 

FORM OF PLEDGE AND SECURITY AGREEMENT

 

PLEDGE AND SECURITY AGREEMENT,
dated as of February __, 2015 (this "Agreement"), made by Enerpulse Technologies, Inc., a Nevada corporation
(the "Company"), Enerpulse, Inc., a Delaware corporation ("Enerpulse") and each other
Subsidiary of the Company hereafter becoming party hereto (together with the Company and Enerpulse, each a "Grantor"
and, collectively, the "Grantors"), in favor of AIGH Investment Partners, LLC, in its capacity as collateral agent
(in such capacity, the "Collateral Agent") for the Buyers (as defined below) party to the Securities Purchase
Agreement, dated as of even date herewith (as amended, restated, supplemented or otherwise modified from time to time, the "Securities
Purchase Agreement").

 

WITNESSETH:

 

WHEREAS, the Company and
each party listed as a "Buyer" on the Schedule of Buyers (as such schedule may be amended, restated or otherwise modified
from time to time) attached thereto, (together with their respective successors and assigns, each a "Buyer", and
collectively, the "Buyers") are parties to the Securities Purchase Agreement, pursuant to which the Company shall
be required to sell, and the Buyers shall purchase or have the right to purchase, the "Notes" (as defined in the
Securities Purchase Agreement);

 

WHEREAS, it is a condition
precedent to the Buyers consummating the transactions contemplated by the Securities Purchase Agreement that the Grantors execute
and deliver to the Collateral Agent this Agreement providing for the grant to the Collateral Agent for the benefit of the Buyers
of a security interest in all personal property of the Grantors to secure all of the Company's obligations under the Securities
Purchase Agreement and the "Notes" (as defined therein) issued pursuant thereto (as such Notes may be amended, restated,
replaced or otherwise modified from time to time in accordance with the terms thereof, collectively, the "Notes")
and the other Secured Transaction Documents (as defined below);

 

WHEREAS, the Grantors (i)
are mutually dependent on each other in the conduct of their respective businesses as an integrated operation, with the credit
needed from time to time by one often being provided through financing obtained by the other Grantors and the ability to obtain
such financing being dependent on the successful operations of the Grantors and (ii) will receive a mutual benefit from the proceeds
received by the Company in respect of the issuance of the Notes; and

 

WHEREAS, each Grantor has
determined that the execution, delivery and performance of this Agreement directly benefits, and are in the best interest of the
Company and such Grantor.

 

NOW, THEREFORE, in consideration
of the premises and the agreements herein and in order to induce the Buyers to perform under the Securities Purchase Agreement,
each Grantor agrees with the Collateral Agent, for the benefit of the Buyers, as follows:

 

    	-1-

    	 

    

 

Section
1.          Definitions.

 

(a)          Reference
is hereby made to the Securities Purchase Agreement and the Notes for a statement of the terms thereof. All terms used in this
Agreement and the recitals hereto which are defined in the Securities Purchase Agreement, the Notes or in Articles 8 or 9 of the
Uniform Commercial Code (the "Code") as in effect from time to time in the State of New York, and which are not
otherwise defined herein shall have the same meanings herein as set forth therein; provided that terms used herein which
are defined in the Code as in effect in the State of New York on the date hereof shall continue to have the same meaning notwithstanding
any replacement or amendment of such statute except as the Collateral Agent may otherwise determine.

 

(b)          The
following terms shall have the respective meanings provided for in the Code: "Accounts", "Cash Proceeds", "Chattel
Paper", "Commercial Tort Claim", "Commodity Account", "Commodity Contracts", "Deposit Account",
"Documents", "Equipment", "Fixtures", "General Intangibles", "Goods", "Instruments",
"Inventory", "Investment Property", "Letter-of-Credit Rights", "Noncash Proceeds", "Payment
Intangibles", "Proceeds", "Promissory Notes", "Security", "Record", "Security
Account", "Software", and "Supporting Obligations".

 

(c)          As
used in this Agreement, the following terms shall have the respective meanings indicated below, such meanings to be applicable
equally to both the singular and plural forms of such terms:

 

"Collateral"
shall have the meaning set forth in Section 2 hereof.

 

"Copyright Licenses"
means all licenses, contracts or other agreements, whether written or oral, naming any Grantor as licensee or licensor and providing
for the grant of any right to use or sell any works covered by any copyright (including, without limitation, all Copyright Licenses
set forth in Schedule II hereto).

 

"Copyrights"
means all domestic and foreign copyrights, whether registered or not, including, without limitation, all copyright rights throughout
the universe (whether now or hereafter arising) in any and all media (whether now or hereafter developed), in and to all original
works of authorship fixed in any tangible medium of expression, acquired or used by any Grantor (including, without limitation,
all copyrights described in Schedule II hereto), all applications, registrations and recordings thereof (including, without
limitation, applications, registrations and recordings in the United States Copyright Office or in any similar office or agency
of the United States or any other country or any political subdivision thereof), and all reissues, divisions, continuations, continuations
in part and extensions or renewals thereof.

 

"Event of Default"
means (i) any defined event of default under any one or more of the Secured Transaction Documents, in each instance, after giving
effect to any notice, grace, or cure periods provided for in the applicable Secured Transaction Document, (ii) the failure by the
Company to pay any amounts when due under the Notes or any other Secured Transaction Document, (iii) the breach of any representation,
warranty by any Grantor under this Agreement in any material respect, or (iv) the breach of any covenant by any Grantor under this
Agreement except, in the case of a breach of a covenant which is curable, only if such breach continues for a period of at least
five (5) consecutive Business Days.

 

    	-2-

    	 

    

 

 “Excluded
Collateral” means (i) any right under any lease, license or other contract or agreement, but only to the extent that
the granting of a security interest therein or an assignment thereof would violate any applicable law or would result in an invalidation
thereof or constitute a breach or violation of such lease, license or other contract or agreement, as applicable (other than any
contractual prohibition on the assignment of accounts or payment intangibles that is unenforceable under the UCC or any other
applicable law), provided that to the extent such security interest at any time hereafter shall no longer be prohibited by law
or agreement, and/or immediately upon such provision no longer being enforceable, as the case may be, such assets shall automatically
and without any further action shall no longer constitute Excluded Collateral, (ii) any voting equity interests in any foreign
Subsidiary in excess of 65% of all such voting equity interest of such foreign Subsidiary, (iii) any assets as to which the Collateral
Agent and any Grantor shall agree in writing that (A) the cost of obtaining a security interest is excessive in relation to the
value of the security to be afforded thereby or (B) obtaining such security interest is not commercially practical, and (iv) any
trademark applications on the basis of such Grantor’s “intent-to-use” such trademark to the extent that granting
a security interest in such trademark application prior to such filing would adversely affect the enforceability or validity or
result in the voiding of such trademark application.

 

"Existing Issuer"
has the meaning specified therefor in the definition of the term "Pledged Shares".

 

"Guaranty"
means the Guaranty, dated as of the date hereof, by Enerpulse in favor of the Buyers and the Collateral Agent, as the same may
be amended, restated, supplemented or otherwise modified from time to time.

 

"Insolvency Proceeding"
means any proceeding commenced by or against any Person under any provision of the Bankruptcy Code (Chapter 11 of Title 11
of the United States Code) or under any other bankruptcy or insolvency law, assignments for the benefit of creditors, formal or
informal moratoria, compositions, or extensions generally with creditors, or proceedings seeking reorganization, arrangement, or
other similar relief.

 

"Intellectual Property"
means the Copyrights, Trademarks and Patents.

 

"Licenses"
means the Copyright Licenses, the Trademark Licenses and the Patent Licenses.

 

"Lien" means
any mortgage, deed of trust, pledge, lien (statutory or otherwise), security interest, charge or other encumbrance or security
or preferential arrangement of any nature, including, without limitation, any conditional sale or title retention arrangement,
any capitalized lease and any assignment, deposit arrangement or financing lease intended as, or having the effect of, security.

 

"Obligations"
shall have the meaning set forth in Section 3 hereof.

 

    	-3-

    	 

    

 

"Patent Licenses"
means all licenses, contracts or other agreements, whether written or oral, naming any Grantor as licensee or licensor and providing
for the grant of any right to manufacture, use or sell any invention covered by any Patent (including, without limitation, all
Patent Licenses set forth in Schedule II hereto).

 

"Patents"
means all domestic and foreign letters patent, design patents, utility patents, industrial designs, inventions, trade secrets,
ideas, concepts, methods, techniques, processes, proprietary information, technology, know-how, formulae, rights of publicity and
other general intangibles of like nature, of any Grantor, now existing or hereafter acquired (including, without limitation, all
domestic and foreign letters patent, design patents, utility patents, industrial designs, inventions, trade secrets, ideas, concepts,
methods, techniques, processes, proprietary information, technology, know-how and formulae described in Schedule II hereto),
all applications, registrations and recordings thereof (including, without limitation, applications, registrations and recordings
in the United States Patent and Trademark Office, or in any similar office or agency of the United States or any other country
or any political subdivision thereof), and all reissues, divisions, continuations, continuations in part and extensions or renewals
thereof.

 

"Permitted Liens"
shall have the meaning set forth in the Notes.

 

"Pledged Debt"
means the indebtedness described in Schedule VII hereto and all indebtedness from time to time owned or acquired by a Grantor,
the promissory notes and other Instruments evidencing any or all of such indebtedness, and all interest, cash, Instruments, Investment
Property, financial assets, securities, capital stock, other equity interests, stock options and commodity contracts, notes, debentures,
bonds, promissory notes or other evidences of indebtedness and all other property from time to time received, receivable or otherwise
distributed in respect of or in exchange for any or all of such indebtedness.

 

"Pledged Interests"
means, collectively, (a) the Pledged Debt, (b) the Pledged Shares and (c) all security entitlements in any and all of the foregoing.

 

"Pledged Issuer"
has the meaning specified therefor in the definition of the term "Pledged Shares".

 

"Pledged Shares"
means (a) the shares of capital stock or other equity interests described in Schedule VIII hereto, whether or not evidenced or
represented by any stock certificate, certificated security or other Instrument, issued by the Persons described in such Schedule
VIII (the "Existing Issuers"), (b) the shares of capital stock or other equity interests at any time and from
time to time acquired by a Grantor of any and all Persons now or hereafter existing (such Persons, together with the Existing Issuers,
being hereinafter referred to collectively as the "Pledged Issuers" and each individually as a "Pledged
Issuer"), whether or not evidenced or represented by any stock certificate, certificated security or other Instrument,
and (c) the certificates representing such shares of capital stock, all options and other rights, contractual or otherwise, in
respect thereof and all dividends, distributions, cash, Instruments, Investment Property, financial assets, securities, capital
stock, other equity interests, stock options and commodity contracts, notes, debentures, bonds, promissory notes or other evidences
of indebtedness and all other property (including, without limitation, any stock dividend and any distribution in connection with
a stock split) from time to time received, receivable or otherwise distributed in respect of or in exchange for any or all of such
capital stock.

 

    	-4-

    	 

    

  

"Trademark Licenses"
means all licenses, contracts or other agreements, whether written or oral, naming any Grantor as licensor or licensee and providing
for the grant of any right concerning any Trademark, together with any goodwill connected with and symbolized by any such trademark
licenses, contracts or agreements and the right to prepare for sale or lease and sell or lease any and all Inventory now or hereafter
owned by any Grantor and now or hereafter covered by such licenses (including, without limitation, all Trademark Licenses described
in Schedule II hereto).

 

"Trademarks"
means all domestic and foreign trademarks, service marks, collective marks, certification marks, trade names, business names, d/b/a's,
Internet domain names, trade styles, designs, logos and other source or business identifiers and all general intangibles of like
nature, now or hereafter owned, adopted, acquired or used by any Grantor (including, without limitation, all domestic and foreign
trademarks, service marks, collective marks, certification marks, trade names, business names, d/b/a's, Internet domain names,
trade styles, designs, logos and other source or business identifiers described in Schedule II hereto), all applications,
registrations and recordings thereof (including, without limitation, applications, registrations and recordings in the United States
Patent and Trademark Office or in any similar office or agency of the United States, any state thereof or any other country or
any political subdivision thereof), and all reissues, extensions or renewals thereof, together with all goodwill of the business
symbolized by such marks and all customer lists, formulae and other Records of any Grantor relating to the distribution of products
and services in connection with which any of such marks are used.

 

"Secured Transaction
Documents" means, collectively, the Securities Purchase Agreement, the Notes (as defined in the Securities Purchase Agreement)
and the Security Documents (as defined in the Securities Purchase Agreement).

 

Section
2.          Grant of Security Interest. As collateral security
for all of the Obligations, each Grantor hereby pledges and assigns to the Collateral Agent for the benefit of the Buyers, and
grants to the Collateral Agent for the benefit of the Buyers a continuing security interest in, all personal property of such Grantor,
wherever located and whether now or hereafter existing and whether now owned or hereafter acquired, of every kind and description,
tangible or intangible (collectively, but in any case, excluding any Excluded Collateral, the "Collateral"), including,
without limitation, the following:

 

(a)          all
Accounts;

 

(b)          all
Chattel Paper (whether tangible or electronic);

 

(c)          the
Commercial Tort Claims specified on Schedule VI hereto;

 

(d)          all
Deposit Accounts (including, without limitation, all cash, and all other property from time to time deposited therein and the monies
and property in the possession or under the control of the Collateral Agent or a Buyer or any affiliate, representative, agent
or correspondent of the Collateral Agent or a Buyer;

 

    	-5-

    	 

    

 

(e)          all
Documents;

 

(f)          all
Equipment;

 

(g)          all
Fixtures;

 

(h)          all
General Intangibles (including, without limitation, all Payment Intangibles);

 

(i)          all
Goods;

 

(j)          all
Instruments (including, without limitation, Promissory Notes and each certificated Security);

 

(k)          all
Inventory;

 

(l)          all
Investment Property;

 

(m)          all
Copyrights, Patents and Trademarks, and all Licenses;

 

(n)          all
Letter-of-Credit Rights;

 

(o)          all
Supporting Obligations;

 

(p)          all
Pledged Interests;

 

(q)          all
other tangible and intangible personal property of such Grantor (whether or not subject to the Code), including, without limitation,
all bank and other accounts and all cash and all investments therein, all proceeds, products, offspring, accessions, rents, profits,
income, benefits, substitutions and replacements of and to any of the property of such Grantor described in the preceding clauses
of this Section 2 (including, without limitation, any proceeds of insurance thereon and all causes of action, claims and
warranties now or hereafter held by such Grantor in respect of any of the items listed above), and all books, correspondence, files
and other Records, including, without limitation, all tapes, desks, cards, Software, data and computer programs in the possession
or under the control of such Grantor or any other Person from time to time acting for such Grantor that at any time evidence or
contain information relating to any of the property described in the preceding clauses of this Section 2 or are otherwise
necessary or helpful in the collection or realization thereof; and

 

(r)          all
Proceeds, including all Cash Proceeds and Noncash Proceeds, and products of any and all of the foregoing Collateral;

 

in each case, howsoever such
Grantor's interest therein may arise or appear (whether by ownership, security interest, claim or otherwise).

 

    	-6-

    	 

    

 

Section
3.          Security for Obligations. The security interest created
hereby in the Collateral constitutes continuing collateral security for all of the following obligations, whether now existing
or hereafter incurred (collectively, the "Obligations"):

 

(a)          the
prompt payment by each Grantor, as and when due and payable (by scheduled maturity, required prepayment, acceleration, demand or
otherwise), of all amounts from time to time owing by it in respect of the Securities Purchase Agreement, the Notes, the Guaranty
and the other Secured Transaction Documents, including, without limitation, (A) all principal of and interest on the Notes (including,
without limitation, all interest that accrues after the commencement of any Insolvency Proceeding of any Grantor, whether or not
the payment of such interest is unenforceable or is not allowable due to the existence of such Insolvency Proceeding), (B) all
amounts from time to time owing by such Grantor under the Guaranty, and (C) all fees, commissions, expense reimbursements, indemnifications
and all other amounts due or to become due under any of the Secured Transaction Documents; and

 

(b)          the
due performance and observance by each Grantor of all of its other obligations from time to time existing in respect of any of
the Secured Transaction Documents for so long as the Notes are outstanding.

 

Section
4.          Representations and Warranties. Each Grantor represents
and warrants as of the date hereof as follows:

 

(a)          Schedule
I hereto sets forth (i) the exact legal name of such Grantor, and (ii) the organizational identification number of such Grantor
or states that no such organizational identification number exists.

 

(b)          There
is no pending or written notice threatening any action, suit, proceeding or claim affecting such Grantor before any governmental
authority or any arbitrator, or any order, judgment or award by any governmental authority or arbitrator, that could reasonably
be expected to materially and adversely affect the grant by such Grantor, or the perfection, of the security interest purported
to be created hereby in the Collateral, or the exercise by the Collateral Agent of any of its rights or remedies hereunder.

 

(c)          All
Federal, state and local tax returns and other reports required by applicable law to be filed by such Grantor have been filed,
or extensions have been obtained, and all taxes, assessments and other governmental charges imposed upon such Grantor or any property
of such Grantor (including, without limitation, all federal income and social security taxes on employees' wages) and which have
become due and payable on or prior to the date hereof have been paid, except to the extent contested in good faith by proper proceedings
which stay the imposition of any penalty, fine or Lien resulting from the non-payment thereof and with respect to which adequate
reserves have been set aside for the payment thereof in accordance with United States generally accepted accounting principles
consistently applied ("GAAP").

 

    	-7-

    	 

    

 

(d)          All
material Equipment, Fixtures, Goods and Inventory of such Grantor now existing are, and all Equipment, Fixtures, Goods and Inventory
of such Grantor hereafter existing will be, located and/or based at the addresses specified therefor in Schedule III hereto,
except that such Grantor will give the Collateral Agent not less than 10 days' prior written notice of any change of the location
of any such Collateral, other than to locations set forth on Schedule III and with respect to which the Collateral Agent
has filed financing statements and otherwise fully perfected its Liens thereon. Such Grantor's chief place of business and chief
executive office, the place where such Grantor keeps its Records concerning Accounts and all originals of all Chattel Paper are
located at the addresses specified therefor in Schedule III hereto. None of the Accounts is evidenced by Promissory Notes
or other Instruments. Set forth in Schedule IV hereto is a complete and accurate list, as of the date of this Agreement,
of (i) each Promissory Note, Security and other Instrument owned by each Grantor and (ii) each Deposit Account, Securities Account
and Commodities Account of each Grantor, together with the name and address of each institution at which each such Account is maintained,
the account number for each such Account and a description of the purpose of each such Account.

 

(e)          
Each material License now existing is, and any material License entered into in the future will be, the legal, valid and binding
obligation of the parties thereto, enforceable against such parties in accordance with its terms, except as may be limited by applicable
bankruptcy, insolvency, reorganization, moratorium, fraudulent conveyance, suretyship or other similar laws and equitable principles
(regardless of whether enforcement is sought in equity or in law). No default under any material License by any such party has
occurred, nor does any defense, offset, deduction or counterclaim exist thereunder in favor of any such party.

 

(f)          Such
Grantor owns and controls, or otherwise possesses adequate rights to use, all Trademarks, Patents and Copyrights necessary to conduct
its business in substantially the same manner as conducted as of the date hereof. Schedule II hereto sets forth a true and
complete list of all registered copyrights, issued patents, and Trademarks (including, without limitation, any Internet domain
names and the registrar of each such Internet domain name), annually owned or used by such Grantor as of the date hereof. To the
best knowledge of each Grantor, all such Intellectual Property of such Grantor is subsisting and in full force and effect, has
not been adjudged invalid or unenforceable, is valid and enforceable and has not been abandoned in whole or in part except as could
not reasonably be expected to have a Material Adverse Effect. Except as set forth in Schedule II, no such Intellectual Property
is the subject of any licensing or franchising agreement. Such Grantor has no knowledge of any conflict with the rights of others
to any Intellectual Property and, to the best knowledge of such Grantor, such Grantor is not now infringing or in conflict with
any such rights of others in any material respect, and to the best knowledge of such Grantor, no other Person is now infringing
or in conflict in any material respect with any such properties, assets and rights owned or used by such Grantor except as could
not reasonably be expected to have a Material Adverse Effect. Such Grantor has not received any notice that it is violating or
has violated the trademarks, patents, copyrights, inventions, trade secrets, proprietary information and technology, know-how,
formulae, rights of publicity or other intellectual property rights of any third party except as could not reasonably be expected
to have a Material Adverse Effect.

 

(g)          Such
Grantor is and will be at all times the sole and exclusive owner of, or otherwise has and will have adequate rights in, the Collateral
free and clear of any Liens, except for Permitted Liens on any Collateral. No effective financing statement or other instrument
similar in effect covering all or any part of the Collateral is on file in any recording or filing office except (A) such
as may have been filed in favor of the Collateral Agent relating to this Agreement, and (B) such as may have been filed to
perfect any Permitted Liens.

 

    	-8-

    	 

    

 

(h)          [Intentionally
omitted]

 

(i)          No
authorization or approval or other action by, and no notice to or filing with, any governmental authority or other regulatory body,
or any other Person, is required for (i) the grant by such Grantor, or the perfection, of the security interest purported
to be created hereby in the Collateral, or (ii) the exercise by the Collateral Agent of any of its rights and remedies hereunder,
except (A) for the filing under the Uniform Commercial Code as in effect in the applicable jurisdiction of the financing statements,
all of which financing statements, have been duly filed and are in full force and effect, (B) with respect to the perfection
of the security interest created hereby in the Intellectual Property, for the recording of the appropriate Assignment for Security,
substantially in the form of Exhibit A hereto, as applicable, in the United States Patent and Trademark Office or the United
States Copyright Office, as applicable, (C) with respect to the perfection of the security interest created hereby in foreign
Intellectual Property and Licenses, for registrations and filings in jurisdictions located outside of the United States and covering
rights in such jurisdictions relating to the Intellectual Property and Licenses, (D) with respect to the perfection of the security
interest created hereby in titled Collateral, for the submission of an appropriate application requesting that the Lien of the
Collateral Agent be noted on the certificate of title or certificate of ownership, completed and authenticated by the applicable
Grantor, together with the certificate of title or certificate of ownership, with respect to such titled Collateral, to the appropriate
Governmental Authority, (E) with respect to any action that may be necessary to obtain control of Collateral constituting Electronic
Chattel Paper, Investment Property or Letter-of-Credit Rights, the taking of such actions, and (F) the Collateral Agent's having
possession of all Documents, Chattel Paper, Instruments and cash constituting Collateral.

 

(j)          This
Agreement creates in favor of the Collateral Agent a legal, valid and enforceable security interest in the Collateral, as security
for the Obligations. The Collateral Agent's having possession of all Instruments and cash constituting Collateral from time to
time, the recording of the appropriate Assignment for Security executed pursuant hereto in the United States Patent and Trademark
Office and the United States Copyright Office, as applicable, and the filing of the financing statements and the other filings
and recordings, as applicable, described in Schedule V hereto and, with respect to the Intellectual Property hereafter existing
and not covered by an appropriate Assignment for Security, the recording in the United States Patent and Trademark Office or the
United States Copyright Office, as applicable, of appropriate instruments of assignment, result in the perfection of such security
interests, in each case, as and to the extent such security interests can be perfected by taking all actions required to be taken
pursuant to the terms of this Agreement. Such security interests in such Collateral are, or in the case of Collateral in which
such Grantor obtains rights after the date hereof, will be, perfected, first priority security interests, subject only to Permitted
Liens and the recording of such instruments of assignment, in each case, as and to the extent such security interests can be perfected
by taking all actions required to be taken pursuant to the terms of this Agreement. Such recordings and filings and all other action
necessary or desirable to perfect and protect such security interest have been duly taken, except for the Collateral Agent's having
possession of Instruments and cash constituting Collateral after the date hereof and the other filings and recordations described
in Section 4(i) hereof.

 

    	-9-

    	 

    

 

(k)          As
of the date hereof, such Grantor does not hold any Commercial Tort Claims nor is such Grantor aware of any such pending claims,
except for such claims described in Schedule VI.

 

(l)          Each
of the Grantors (other than the Company) is a wholly-owned Subsidiary of the Company and are the only Subsidiaries of the Company,
as of the date hereof.

 

Section
5.          Covenants as to the Collateral. So long as any of the
Obligations (other than contingent obligations for which no claim has been asserted) shall remain outstanding, unless the Collateral
Agent shall otherwise consent in writing:

 

(a)          Further
Assurances. Each Grantor will at its expense, at any time and from time to time, promptly execute and deliver all further instruments
and documents and take all further action that the Collateral Agent may reasonably request in order to: (i) perfect and protect
the security interest purported to be created hereby; (ii) enable the Collateral Agent to exercise and enforce its rights
and remedies hereunder in respect of the Collateral; or (iii) otherwise effect the purposes of this Agreement, including,
without limitation: (A) marking conspicuously all Chattel Paper and each License and, at the request of the Collateral Agent,
each of its Records pertaining to the Collateral with a legend, in form and substance satisfactory to the Collateral Agent, indicating
that such Chattel Paper, License or Collateral is subject to the security interest created hereby, (B)  delivering and pledging
to the Collateral Agent hereunder each Promissory Note, Security, Chattel Paper or other Instrument, now or hereafter owned by
such Grantor, duly endorsed and accompanied by executed instruments of transfer or assignment, all in form and substance satisfactory
to the Collateral Agent, (C) executing and filing (to the extent, if any, that such Grantor's signature is required thereon)
or authenticating the filing of, such financing or continuation statements, or amendments thereto, as may be necessary or desirable
or that the Collateral Agent may request in order to perfect and preserve the security interest purported to be created hereby,
(D) furnishing to the Collateral Agent from time to time statements and schedules further identifying and describing the Collateral
and such other reports in connection with the Collateral in each case as the Collateral Agent may reasonably request, all in reasonable
detail, (E) if any Collateral shall be in the possession of a third party, notifying such Person of the Collateral Agent's
security interest created hereby and obtaining a written acknowledgment from such Person that such Person holds possession of the
Collateral for the benefit of the Collateral Agent, which such written acknowledgement
shall be in form and substance satisfactory to the Collateral Agent, (F) if at any time after the date hereof, such Grantor
acquires or holds any Commercial Tort Claim having a value of $25,000 or more in any proceeding in a court of competent jurisdiction,
promptly notifying the Collateral Agent in a writing signed by such Grantor setting forth a brief description of such Commercial
Tort Claim and granting to the Collateral Agent a security interest therein and in the proceeds thereof, which writing shall incorporate
the provisions hereof and shall be in form and substance satisfactory to the Collateral Agent, (G)  if requested by the Collateral
Agent, upon the acquisition after the date hereof by such Grantor of any motor vehicle or other Equipment having a value of $25,000
or more, subject to a certificate of title or ownership (other than a Motor Vehicle or Equipment that is subject to a purchase
money security interest), causing the Collateral Agent to be listed as the lienholder on such certificate of title or ownership
and delivering evidence of the same to the Collateral Agent in accordance with the Securities Purchase Agreement; and (H) taking
all actions required by any earlier versions of the Uniform Commercial Code or by other law, as applicable, in any relevant Uniform
Commercial Code jurisdiction, or by other law as applicable in any foreign jurisdiction.

 

    	-10-

    	 

    

 

(b)          Location
of Equipment and Inventory. Each Grantor will keep the Equipment and Inventory (other than as may be out for repair or refurbishment,
or in the possession of employees or customers in the ordinary course of business) at the locations specified therefor in Section 4(g)
hereof or, upon not less than ten (10) days' prior written notice to the Collateral Agent accompanied by a new Schedule V
hereto indicating each new location of the Equipment and Inventory, at such other locations in the United States.

 

(c)          Condition
of Equipment. Each Grantor will maintain or cause the Equipment (necessary or useful to its business) to be maintained and
preserved in good condition, repair and working order, ordinary wear and tear excepted, and will forthwith, or in the case of any
loss or damage to any material Equipment of such Grantor within a commercially reasonable time after the occurrence thereof, make
or cause to be made all repairs, replacements and other improvements in connection therewith which are necessary or desirable,
consistent with past practice, or which the Collateral Agent may reasonably request to such end. Such Grantor will promptly furnish
to the Collateral Agent a statement describing in reasonable detail any such loss or damage to any such Equipment.

 

(d)          Taxes,
Etc. Each Grantor agrees to pay promptly when due all material property and other material taxes, assessments and governmental
charges or levies imposed upon the Equipment and Inventory, except to the extent the validity thereof is being contested in good
faith by proper proceedings which stay the imposition of any penalty, fine or Lien resulting from the non-payment thereof and with
respect to which adequate reserves in accordance with GAAP have been set aside for the payment thereof.

 

(e)          Insurance.

 

(i)          
Each Grantor will, at its own expense, maintain insurance (including, without limitation, commercial general liability and property
insurance) with respect to the Equipment and Inventory in such amounts, against such risks, in such form and with responsible and
reputable insurance companies or associations as is required by any governmental authority having jurisdiction with respect thereto
or as is carried by such Grantor as of the date hereof and in any event, in amount, adequacy and scope reasonably satisfactory
to the Collateral Agent. Unless otherwise agreed to by the Collateral Agent, each such policy for liability insurance shall provide
for all losses to be paid on behalf of the Collateral Agent and such Grantor as their respective interests may appear, and each
policy for property damage insurance shall provide for all losses to be adjusted with, and paid directly to, the Collateral Agent.
Unless otherwise agreed to by the Collateral Agent, each such policy shall in addition (A) name the Collateral Agent as an additional
insured party thereunder (without any representation or warranty by or obligation upon the Collateral Agent) as their interests
may appear, (B) contain an agreement by the insurer that any loss thereunder shall be payable to the Collateral Agent on its own
account notwithstanding any action, inaction or breach of representation or warranty by such Grantor, (C) provide that there shall
be no recourse against the Collateral Agent for payment of premiums or other amounts with respect thereto, and (D) provide that
at least 30 days' prior written notice of cancellation, lapse, expiration or other adverse change shall be given to the Collateral
Agent by the insurer. Such Grantor will, if so reasonably requested by the Collateral Agent, deliver to the Collateral Agent original
or duplicate policies of such insurance and, as often as the Collateral Agent may reasonably request, a report of a reputable insurance
broker with respect to such insurance. Such Grantor will also, at the reasonable request of the Collateral Agent, execute and deliver
instruments of assignment of such insurance policies and cause the respective insurers to acknowledge notice of such assignment.

 

    	-11-

    	 

    

 

(ii)         Reimbursement
under any liability insurance maintained by a Grantor pursuant to this Section 5(e) may be paid directly to the Person who
shall have incurred liability covered by such insurance.

 

(iii)        All
insurance payments received by any Grantor during the continuation of any Event of Default in respect of such Equipment or Inventory
shall be paid to the Collateral Agent and applied as specified in Section 7(b) hereof.

 

(f)          Provisions
Concerning the Accounts and the Licenses.

 

(i)          Each
Grantor will (A) give the Collateral Agent at least ten (10) days' prior written notice of any change in such Grantor's name, identity
or organizational structure, (B) maintain its jurisdiction of incorporation as set forth in Section 4(b) hereto, (C) immediately
notify the Collateral Agent upon obtaining an organizational identification number, if on the date hereof such Grantor did not
have such identification number, and (D) keep adequate records concerning the Accounts and Chattel Paper.

 

(ii)         Each
Grantor will, except as otherwise provided in this subsection (f), continue to use commercially reasonable efforts to collect,
at its own expense, all amounts due or to become due under the Accounts. In connection with such collections, such Grantor may
(and, at the Collateral Agent's direction, will) take such action as such Grantor or the Collateral Agent may deem necessary or
advisable to enforce collection or performance of the Accounts; provided, however, that the Collateral Agent shall
have the right at any time, upon the occurrence and during the continuance of an Event of Default, to notify the account debtors
or obligors under any Accounts of the assignment of such Accounts to the Collateral Agent and to direct such account debtors or
obligors to make payment of all amounts due or to become due to such Grantor thereunder directly to the Collateral Agent or its
designated agent and, upon such notification and at the expense of such Grantor and to the extent permitted by law, to enforce
collection of any such Accounts and to adjust, settle or compromise the amount or payment thereof, in the same manner and to the
same extent as such Grantor might have done. After receipt by a Grantor of a notice from the Collateral Agent that the Collateral
Agent has notified, intends to notify, or has enforced or intends to enforce a Grantor's rights against the account debtors or
obligors under any Accounts as referred to in the proviso to the immediately preceding sentence, (A) all amounts and proceeds
(including Instruments) received by such Grantor in respect of the Accounts shall be received in trust for the benefit of the Collateral
Agent hereunder, shall be segregated from other funds of such Grantor and shall be forthwith paid over to the Collateral Agent
in the same form as so received (with any necessary endorsement) to be held as cash collateral and applied as specified in Section
7(b) hereof, and (B) such Grantor will not adjust, settle or compromise the amount or payment of any Account or release wholly
or partly any account debtor or obligor thereof or allow any credit or discount thereon. In addition, upon the occurrence and during
the continuance of an Event of Default, the Collateral Agent may (in its sole and absolute discretion) direct any or all of the
banks and financial institutions with which such Grantor either maintains a Deposit Account or a lockbox or deposits the proceeds
of any Accounts to send immediately to the Collateral Agent by wire transfer (to such account as the Collateral Agent shall specify,
or in such other manner as the Collateral Agent shall direct) all or a portion of such securities, cash, investments and other
items held by such institution. Any such securities, cash, investments and other items so received by the Collateral Agent shall
(in the sole and absolute discretion of the Collateral Agent) be applied to the repayment of the Obligations or distributed in
accordance with Section 7 hereof.

 

    	-12-

    	 

    

 

(iii)        Upon
the occurrence and during the continuance of any material breach or default under any material License by any party thereto other
than a Grantor, the Grantor party thereto will, promptly after obtaining knowledge thereof, give the Collateral Agent written notice
of the nature and duration thereof, specifying what action, if any, it has taken and proposes to take with respect thereto and
thereafter will take reasonable steps to protect and preserve its rights and remedies in respect of such breach or default, or
will obtain or acquire an appropriate substitute License.

 

(iv)        [Intentionally
omitted]

 

(v)         Each
Grantor will, in accordance with its reasonable business judgment, exercise promptly and diligently each and every right which
it may have under each material License (other than any right of termination) and will duly perform and observe in all respects
all of its obligations under each material License and will take all action reasonably necessary to maintain such Licenses in full
force and effect.

 

(g)          Transfers
and Other Liens.

 

(i)          No
Grantor will sell, assign (by operation of law or otherwise), lease, license, exchange or otherwise transfer or dispose of any
of the Collateral, except (A) Inventory in the ordinary course of business, (B) worn-out or obsolete assets not necessary to the
business, (C) dispositions not otherwise permitted hereunder which are made for fair market value; provided, that (i) at the time
of any disposition, no Event of Default shall exist or shall result from such disposition, (ii) 100% of the aggregate sales price
from such disposition shall be paid in cash, and (iii) the aggregate fair market value of all assets so sold by the Grantors, together,
shall not exceed in any $25,000 in any 12 month period, (D) dispositions of cash equivalents for fair market value, (E) dispositions
among Grantors, (F) discounting, sale, write-off or forgiveness, without recourse, of delinquent accounts receivable in the ordinary
course of business, but only in connection with the compromise or collection thereof, (G) any disposition to the extent caused
by any involuntary loss, destruction, damage or other casualty or any condemnation, seizure or taking, by exercise of the power
of eminent domain or otherwise, or confiscation or requisition of use of any property, (H) the lapse or disposition of registered
Patents, Trademarks and other Intellectual Property of any Grantor to the extent determined by such Grantor to no longer be material
to the conduct of its business, (I) non-exclusive licenses and sublicenses granted by a Grantor and leases or subleases (by a Grantor
as lessor or sublessor) to third parties not materially interfering with the business of the Grantors, (J) exclusive licenses and
sublicenses granted by a Grantor to third parties solely for exploitation and use outside of North America and not materially interfering
with the business of the Grantors, (K) the contemporaneous exchange of property for property of a like kind, to the extent that
the property received in such exchange is of a value equivalent to the value of the property exchanged and (L) sales of accounts
receivables of a Grantor in connection with a factoring facility provided to a Grantor by a third party that is not an affiliate
of the Company or any Grantor; provided, that any such sale of accounts receivable shall be made (1) on a non-recourse basis
to the Company and its Subsidiaries, (2) at a discount of no more than 10%, and (3) otherwise on customary market terms.

 

    	-13-

    	 

    

 

(ii)         No
Grantor will create, suffer to exist or grant any Lien upon or with respect to any Collateral other than a Permitted Lien.

 

(h)          Intellectual
Property.

 

(i)          If
applicable, each Grantor shall, upon the Collateral Agent's written request, duly execute and deliver the applicable Assignment
for Security in the form attached hereto as Exhibit A. Each Grantor (either itself
or through licensees) will, and will cause each licensee thereof to, in accordance with its reasonable business judgment, take
all action necessary to maintain all of the Intellectual Property in full force and effect, including, without limitation, using
the proper statutory notices and markings and using the Trademarks on each applicable trademark class of goods in order to so maintain
the Trademarks in full force and free from any claim of abandonment for non-use, and such Grantor will not (nor permit any licensee
thereof to) do any act or knowingly omit to do any act whereby any Intellectual Property may become invalidated; provided,
however, that so long as no notice to the contrary has been given by the Collateral Agent during the continuance of any
Event of Default, such Grantor shall not have an obligation to use or to maintain any Intellectual Property (A) that relates
solely to any product or work, that has been, or is in the process of being, discontinued, abandoned or terminated, (B) that is
being replaced with Intellectual Property substantially similar to the Intellectual Property that may be abandoned or otherwise
become invalid, so long as the failure to use or maintain such Intellectual Property does not materially adversely affect the validity
of such replacement Intellectual Property and so long as such replacement Intellectual Property is subject to the Lien created
by this Agreement or (C) that is substantially the same as another Intellectual Property that is in full force, so long the failure
to use or maintain such Intellectual Property does not materially adversely affect the validity of such replacement Intellectual
Property and so long as such other Intellectual Property is subject to the Lien and security interest created by this Agreement.
Each Grantor will, in accordance with its reasonable business judgment, cause to be
taken all necessary steps in any proceeding before the United States Patent and Trademark Office and the United States Copyright
Office or any similar office or agency in any other country or political subdivision thereof to maintain each registration of the
Intellectual Property (other than the Intellectual Property described in the proviso to the immediately preceding sentence), including,
without limitation, filing of renewals, affidavits of use, affidavits of incontestability and opposition, interference and cancellation
proceedings and payment of maintenance fees, filing fees, taxes or other governmental fees in the ordinary course of business.
If any material Intellectual Property (other than Intellectual Property described in the proviso to the first sentence of subsection
(i) of this clause (h)) is infringed, misappropriated, diluted or otherwise violated in any material respect by a third party,
such Grantor shall (x) upon learning of such infringement, misappropriation, dilution or other violation, promptly notify the Collateral
Agent and (y) to the extent such Grantor shall deem appropriate under the circumstances, promptly sue for infringement, misappropriation,
dilution or other violation, seek injunctive relief where appropriate and recover any and all damages for such infringement, misappropriation,
dilution or other violation, or take such other actions as such Grantor shall deem appropriate under the circumstances to protect
such Intellectual Property. Each Grantor shall furnish to the Collateral Agent from
time to time upon its reasonable request statements and schedules further identifying and describing the Intellectual Property
and Licenses and such other reports in connection with the Intellectual Property and Licenses as the Collateral Agent may reasonably
request, all in reasonable detail and promptly upon request of the Collateral Agent, following receipt by the Collateral Agent
of any such statements, schedules or reports, such Grantor shall modify this Agreement by amending Schedule II hereto, as
the case may be, to include any Intellectual Property which becomes part of the Collateral under this Agreement and shall execute
and authenticate such documents and do such acts as shall be necessary or, in the judgment of the Collateral Agent, desirable to
subject such Intellectual Property to the Lien and security interest created by this Agreement. 

 

    	-14-

    	 

    

 

(ii)         [Intentionally
omitted]

 

(iii)        [Intentionally
omitted]

 

(i)          Deposit,
Commodities and Securities Accounts. Upon the Collateral Agent's request and unless otherwise agreed by the Collateral Agent,
each Grantor shall cause each bank and other financial institution with an account referred to in Schedule IV hereto to
execute and deliver to the Collateral Agent a control agreement, in form and substance reasonably satisfactory to the Collateral
Agent, duly executed by such Grantor and such bank or financial institution, or enter into other arrangements in form and substance
reasonably satisfactory to the Collateral Agent, pursuant to which such institution shall irrevocably agree, inter alia,
that (unless otherwise agreed by the Collateral Agent) (i) it will comply at any time with the instructions originated by
the Collateral Agent to such bank or financial institution directing the disposition of cash, Commodity Contracts, securities,
Investment Property and other items from time to time credited to such account, without further consent of such Grantor, which
instructions the Collateral Agent will not give to such bank or other financial institution in the absence of a continuing Event
of Default, (ii) all cash, Commodity Contracts, securities, Investment Property and other items of such Grantor deposited
with such institution shall be subject to a perfected, first priority security interest in favor of the Collateral Agent, (iii) any
right of set off, banker's Lien or other similar Lien, security interest or encumbrance shall be fully waived as against the Collateral
Agent, and (iv) upon receipt of written notice from the Collateral Agent during the continuance of an Event of Default, such
bank or financial institution shall immediately send to the Collateral Agent by wire transfer (to such account as the Collateral
Agent shall specify, or in such other manner as the Collateral Agent shall direct) all such cash, the value of any Commodity Contracts,
securities, Investment Property and other items held by it. Without prior written notice to the Collateral Agent, such Grantor
shall not make or maintain any Deposit Account, Commodity Account or Securities Account except for the accounts set forth in Schedule
IV hereto. The provisions of this paragraph 5(i) shall not apply to (i) Deposit Accounts for which the Collateral Agent is
the depositary, (ii) Deposit Accounts specially and exclusively used for payroll, payroll taxes and other employee wage and benefit
payments to or for the benefit of a Grantor's salaried employees, and (iii) Deposit Accounts not having in excess of $25,000 in
any three (3) consecutive business days.

 

    	-15-

    	 

    

 

(j)          [Intentionally
omitted.]

 

(k)          Control.
Each Grantor hereby agrees to take any or all action that may be necessary or desirable or that the Collateral Agent may reasonably
request in order for the Collateral Agent to obtain control in accordance with Sections 9-105 – 9-107 of the Code with respect
to the following Collateral having a value in excess of $25,000: (i) Electronic Chattel Paper, (ii) Investment Property, (iii)
Pledged Interests and (iv) Letter-of-Credit Rights.

 

(l)          Inspection
and Reporting. Each Grantor shall permit the Collateral Agent, or any agent or representatives thereof or such professionals
or other Persons as the Collateral Agent may designate, not more than once a year in the absence of an Event of Default, (i) to
examine and make copies of and abstracts from such Grantor's records and books of account, (ii) to visit and inspect its properties,
(iii) to verify materials, leases, Instruments, Accounts, Inventory and other assets of such Grantor from time to time, (iii) to
conduct audits, physical counts, appraisals and/or valuations, examinations at the locations of such Grantor. Each Grantor shall
also permit the Collateral Agent, or any agent or representatives thereof or such professionals or other Persons as the Collateral
Agent may designate to discuss such Grantor's affairs, finances and accounts with any of its officers subject to the execution
by the Collateral Agent or its designee(s) of a mutually agreeable confidentiality agreement.

 

(m)          Future
Subsidiaries. If any Grantor shall hereafter create or acquire any Subsidiary (other than joint ventures for which the Grantors,
taken as a whole, control less than 50% of the ordinary voting power with respect to the equity interests of such joint venture),
simultaneously with the creation of acquisition of any such Subsidiary, such Grantor shall cause such Subsidiary to become a party
to this Agreement as an additional "Grantor" hereunder and to become a party to the Guaranty as an additional "Guarantor"
thereunder, and to duly execute and/or deliver such opinions of counsel and other documents, each in form and substance acceptable
to the Collateral Agent, as the Collateral Agent shall reasonably request with respect thereto.

 

Section
6.          Additional Provisions Concerning the Collateral.

 

(a)          Each
Grantor hereby (i) authorizes the Collateral Agent to file one or more Uniform Commercial Code financing or continuation statements,
and amendments thereto, relating to the Collateral (including, without limitation, financing statements describing the Collateral
as "all assets" or "all personal property" or words of similar effect) and (ii) ratifies such authorization
to the extent that the Collateral Agent has filed any such financing or continuation statements, or amendments thereto, prior to
the date hereof. A photocopy or other reproduction of this Agreement or any financing statement covering the Collateral or any
part thereof shall be sufficient as a financing statement where permitted by law.

 

    	-16-

    	 

    

 

(b)          Each
Grantor hereby irrevocably appoints the Collateral Agent as its attorney-in-fact and proxy, with full authority in the place and
stead of such Grantor and in the name of such Grantor or otherwise, from time to time in the Collateral Agent's discretion, so
long as an Event of Default shall have occurred and is continuing, to take any action and to execute any instrument which the Collateral
Agent may deem necessary or advisable to accomplish the purposes of this Agreement (subject to the rights of such Grantor under
Section 5 hereof), including, without limitation, (i) to obtain and adjust insurance required to be paid to the Collateral
Agent pursuant to Section 5(e) hereof, (ii) to ask, demand, collect, sue for, recover, compound, receive and give acquittance
and receipts for moneys due and to become due under or in respect of any Collateral, (iii) to receive, endorse, and collect any
drafts or other instruments, documents and chattel paper in connection with clause (i) or (ii) above, (iv) to file any claims or
take any action or institute any proceedings which the Collateral Agent may deem necessary or desirable for the collection of any
Collateral or otherwise to enforce the rights of the Collateral Agent and the Buyers with respect to any Collateral, and (v) to
execute assignments, licenses and other documents to enforce the rights of the Collateral Agent and the Buyers with respect to
any Collateral. This power is coupled with an interest and is irrevocable until the complete conversion of all of the Company's
obligations under the Notes to equity securities of the Company and/or payment in full in cash of all obligations under the Notes
(together with any matured indemnification obligations as of the date of such conversion and/or payment, but excluding any inchoate
or unmatured contingent indemnification obligations).

 

(c)          For
the purpose of enabling the Collateral Agent to exercise rights and remedies hereunder, at such time as the Collateral Agent shall
be lawfully entitled to exercise such rights and remedies upon and during an Event of Default, and for no other purpose, each Grantor
hereby grants to the Collateral Agent, to the extent assignable, an irrevocable, non-exclusive license (exercisable without payment
of royalty or other compensation to such Grantor) to use, assign, license or sublicense any Intellectual Property now owned or
hereafter acquired by such Grantor, wherever the same may be located, including in such license reasonable access to all media
in which any of the licensed items may be recorded or stored and to all computer programs used for the compilation or printout
thereof. Notwithstanding anything contained herein to the contrary, but subject to the provisions of the Securities Purchase Agreement
that limit the right of such Grantor to dispose of its property and Section 5(h) hereof, so long as no written notice to
the contrary has been given to Grantors by the Collateral Agent during any Event of Default, such Grantor may exploit, use, enjoy,
protect, license, sublicense, assign, sell, dispose of or take other actions with respect to the Intellectual Property in the ordinary
course of its business. In furtherance of the foregoing, unless an Event of Default shall have occurred and be continuing, the
Collateral Agent shall from time to time, upon the request of a Grantor, execute and deliver any instruments, certificates or other
documents, in the form so requested, which such Grantor shall have certified are appropriate (in such Grantor's judgment) to allow
it to take any action permitted above (including relinquishment of the license provided pursuant to this clause (c) as to any Intellectual
Property). Further, upon the complete conversion of all of the Company's obligations under the Notes to equity securities of the
Company and/or payment in full in cash of all obligations under the Notes (together with any matured indemnification obligations
as of the date of such conversion and/or payment, but excluding any inchoate or unmatured contingent indemnification obligations),
the Collateral Agent (subject to Section 10(e) hereof) shall be automatically released and reassigned to such Grantor all
of the Collateral Agent's right, title and interest in and to the Intellectual Property, and the Licenses, all without recourse,
representation or warranty whatsoever. The exercise of rights and remedies hereunder by the Collateral Agent shall not terminate
the rights of the holders of any licenses or sublicenses theretofore granted by such Grantor in accordance with the second sentence
of this clause (c).

 

    	-17-

    	 

    

 

(d)          If
a Grantor fails to perform any agreement contained herein, the Collateral Agent may during an Event of Default itself perform,
or cause performance of, such agreement or obligation, in the name of such Grantor or the Collateral Agent, and the expenses of
the Collateral Agent incurred in connection therewith shall be payable by such Grantor pursuant to Section 8 hereof and
shall be secured by the Collateral.

 

(e)          The
powers conferred on the Collateral Agent hereunder are solely to protect its interest in the Collateral and shall not impose any
duty upon it to exercise any such powers. Except for the safe custody of any Collateral in its possession and the accounting for
moneys actually received by it hereunder, the Collateral Agent shall have no duty as to any Collateral or as to the taking of any
necessary steps to preserve rights against prior parties or any other rights pertaining to any Collateral.

 

(f)          Anything
herein to the contrary notwithstanding (i) each Grantor shall remain liable under the Licenses and otherwise with respect
to any of the Collateral to the extent set forth therein to perform all of its obligations thereunder to the same extent as if
this Agreement had not been executed, (ii) the exercise by the Collateral Agent of any of its rights hereunder shall not release
such Grantor from any of its obligations under the Licenses or otherwise in respect of the Collateral, and (iii) the Collateral
Agent shall not have any obligation or liability by reason of this Agreement under the Licenses or with respect to any of the other
Collateral, nor shall the Collateral Agent be obligated to perform any of the obligations or duties of such Grantor thereunder
or to take any action to collect or enforce any claim for payment assigned hereunder.

 

Section
7.          Remedies Upon Event of Default. If any Event of Default
shall have occurred and be continuing:

 

    	-18-

    	 

    

 

(a)          The
Collateral Agent may exercise in respect of the Collateral, in addition to any other rights and remedies provided for herein or
otherwise available to it, all of the rights and remedies of a secured party upon default under the Code (whether or not the Code
applies to the affected Collateral), and also may (i) take absolute control of the Collateral, including, without limitation,
transfer into the Collateral Agent's name or into the name of its nominee or nominees (to the extent the Collateral Agent has not
theretofore done so) and thereafter receive, for the benefit of the Collateral Agent, all payments made thereon, give all consents,
waivers and ratifications in respect thereof and otherwise act with respect thereto as though it were the outright owner thereof,
(ii) require each Grantor to, and each Grantor hereby agrees that it will at its expense and upon request of the Collateral
Agent forthwith, assemble all or part of its respective Collateral as directed by the Collateral Agent and make it available to
the Collateral Agent at a place or places to be designated by the Collateral Agent that is reasonably convenient to both parties,
and the Collateral Agent may enter into and occupy any premises owned or leased by such Grantor where the Collateral or any part
thereof is located or assembled for a reasonable period in order to effectuate the Collateral Agent's rights and remedies hereunder
or under law, without obligation to such Grantor in respect of such occupation, and (iii) without notice except as specified
below and without any obligation to prepare or process the Collateral for sale, (A) sell the Collateral or any part thereof
in one or more parcels at public or private sale, at any of the Collateral Agent's offices or elsewhere, for cash, on credit or
for future delivery, and at such price or prices and upon such other terms as the Collateral Agent may deem commercially reasonable
and/or (B) lease, license or dispose of the Collateral or any part thereof upon such terms as the Collateral Agent may deem
commercially reasonable. Each Grantor agrees that, to the extent notice of sale or any other disposition of its respective Collateral
shall be required by law, at least ten (10) days' notice to such Grantor of the time and place of any public sale or the time after
which any private sale or other disposition of its respective Collateral is to be made shall constitute reasonable notification.
The Collateral Agent shall not be obligated to make any sale or other disposition of any Collateral regardless of notice of sale
having been given. The Collateral Agent may adjourn any public or private sale from time to time by announcement at the time and
place fixed therefor, and such sale may, without further notice, be made at the time and place to which it was so adjourned. Each
Grantor hereby waives any claims against the Collateral Agent and the Buyers arising by reason of the fact that the price at which
its respective Collateral may have been sold at a private sale was less than the price which might have been obtained at a public
sale or was less than the aggregate amount of the Obligations, even if the Collateral Agent accepts the first offer received and
does not offer such Collateral to more than one offeree, and waives all rights that such Grantor may have to require that all or
any part of such Collateral be marshalled upon any sale (public or private) thereof. Each Grantor hereby acknowledges that (i) any
such sale of its respective Collateral by the Collateral Agent shall be made without warranty, (ii) the Collateral Agent may
specifically disclaim any warranties of title, possession, quiet enjoyment or the like, and (iii) such actions set forth in
clauses (i) and (ii) above shall not adversely affect the commercial reasonableness of any such sale of Collateral. In addition
to the foregoing, (1) upon written notice to any Grantor from the Collateral Agent, such Grantor shall cease any use of the
Intellectual Property or any trademark, patent or copyright similar thereto for any purpose described in such notice; (2) the Collateral
Agent may, at any time and from time to time, upon 10 days' prior notice to such Grantor, license, whether general, special or
otherwise, and whether on an exclusive or non-exclusive basis, any of the Intellectual Property, throughout the universe for such
term or terms, on such conditions, and in such manner, as the Collateral Agent shall in its sole discretion determine to the extent
consistent with any restrictions or conditions imposed upon such Grantor with respect to such Intellectual Property by license
or other contractual arrangement; and (2) the Collateral Agent may, at any time, pursuant to the authority granted in Section
6 hereof (such authority being effective upon the occurrence and during the continuance of an Event of Default), execute and
deliver on behalf of such Grantor, one or more instruments of assignment of the Intellectual Property (or any application or registration
thereof), in form suitable for filing, recording or registration in any country.

 

(b)          Any
cash held by the Collateral Agent as Collateral and all Cash Proceeds received by the Collateral Agent in respect of any sale of
or collection from, or other realization upon, all or any part of the Collateral may, in the discretion of the Collateral Agent,
be held by the Collateral Agent as collateral for, and/or then or at any time thereafter applied (after payment of any amounts
payable to the Collateral Agent pursuant to Section 8 hereof) in whole or in part by the Collateral Agent against, all or
any part of the Obligations in such order as the Collateral Agent shall elect, consistent with the provisions of the Securities
Purchase Agreement. Any surplus of such cash or Cash Proceeds held by the Collateral Agent and remaining after the complete conversion
of all of the Company's obligations under the Notes to equity securities of the Company and/or payment in full in cash of all obligations
under the Notes (together with any matured indemnification obligations as of the date of such conversion and/or payment, but excluding
any inchoate or unmatured contingent indemnification obligations) shall be paid over to whomsoever shall be lawfully entitled to
receive the same or as a court of competent jurisdiction shall direct.

 

    	-19-

    	 

    

 

(c)          In
the event that the proceeds of any such sale, collection or realization are insufficient to pay all amounts to which the Collateral
Agent and the Buyers are legally entitled, each Grantor shall be liable for the deficiency, together with interest thereon at the
highest rate specified in any of the applicable Secured Transaction Documents for interest on overdue principal thereof or such
other rate as shall be fixed by applicable law, together with the costs of collection and the reasonable fees, costs, expenses
and other client charges of any attorneys employed by the Collateral Agent to collect such deficiency.

 

(d)          Each
Grantor hereby acknowledges that if the Collateral Agent complies with any applicable state, provincial, or federal law requirements
in connection with a disposition of the Collateral, such compliance will not adversely affect the commercial reasonableness of
any sale or other disposition of the Collateral.

 

(e)          The
Collateral Agent shall not be required to marshal any present or future collateral security (including, but not limited to, this
Agreement and the Collateral) for, or other assurances of payment of, the Obligations or any of them or to resort to such collateral
security or other assurances of payment in any particular order, and all of the Collateral Agent's rights hereunder and in respect
of such collateral security and other assurances of payment shall be cumulative and in addition to all other rights, however existing
or arising. To the extent that each Grantor lawfully may, such Grantor hereby agrees that it will not invoke any law relating to
the marshalling of collateral which might cause delay in or impede the enforcement of the Collateral Agent's rights under this
Agreement or under any other instrument creating or evidencing any of the Obligations or under which any of the Obligations is
outstanding or by which any of the Obligations is secured or payment thereof is otherwise assured, and, to the extent that it lawfully
may, such Grantor hereby irrevocably waives the benefits of all such laws.

 

Section
8.          Indemnity and Expenses.

 

(a)          Each
Grantor agrees, jointly and severally, to defend, protect, indemnify and hold the Collateral Agent and each of the Buyers, jointly
and severally, harmless from and against any and all claims, damages, losses, liabilities, obligations, penalties, fees, costs
and expenses (including, without limitation, reasonable legal fees, costs, expenses, and disbursements of such Person's counsel)
to the extent that they arise out of or otherwise result from this Agreement (including, without limitation, enforcement of this
Agreement), except claims, losses or liabilities resulting solely and directly from such Person's gross negligence or willful misconduct,
as determined by a final judgment of a court of competent jurisdiction.

 

    	-20-

    	 

    

 

(b)          Each
Grantor agrees, jointly and severally, to, upon demand, pay to the Collateral Agent the amount of any and all reasonable costs
and expenses, including the reasonable fees, costs, expenses and disbursements of counsel for the Collateral Agent and of any experts
and agents (including, without limitation, any collateral trustee which may act as agent of the Collateral Agent), which the Collateral
Agent may incur in connection with (i) the preparation, negotiation, execution, delivery, recordation, administration, amendment,
waiver or other modification or termination of this Agreement, (ii) the custody, preservation, use or operation of, or the
sale of, collection from, or other realization upon, any Collateral, (iii) the exercise or enforcement of any of the rights
of the Collateral Agent hereunder, or (iv) the failure by any Grantor to perform or observe any of the provisions hereof.

 

Section
9.          Notices, Etc. All notices and other communications
provided for hereunder shall be in writing and shall be mailed (by certified mail, postage prepaid and return receipt requested),
telecopied or delivered, if to a Grantor at its address specified below and if to the Collateral Agent to it, at its address specified
below; or as to any such Person, at such other address as shall be designated by such Person in a written notice to such other
Person complying as to delivery with the terms of this Section 9. All such notices and other communications shall be effective
(a) if sent by certified mail, return receipt requested, when received or five days after deposited in the mails, whichever
occurs first, (b) if telecopied or sent by electronic mail, when transmitted (during normal business hours), or (c) if
delivered, upon delivery.

 

Section
10.         Miscellaneous.

 

(a)          No
amendment of any provision of this Agreement shall be effective unless it is in writing and signed by each Grantor and the Collateral
Agent, and no waiver of any provision of this Agreement, and no consent to any departure by a Grantor therefrom, shall be effective
unless it is in writing and signed by the Collateral Agent, and then such waiver or consent shall be effective only in the specific
instance and for the specific purpose for which given.

 

(b)          No
failure on the part of the Collateral Agent to exercise, and no delay in exercising, any right hereunder or under any of the other
Secured Transaction Documents shall operate as a waiver thereof; nor shall any single or partial exercise of any such right preclude
any other or further exercise thereof or the exercise of any other right. The rights and remedies of the Collateral Agent or any
Buyer provided herein and in the other Secured Transaction Documents are cumulative and are in addition to, and not exclusive of,
any rights or remedies provided by law. The rights of the Collateral Agent or any Buyer under any of the other Secured Transaction
Documents against any party thereto are not conditional or contingent on any attempt by such Person to exercise any of its rights
under any of the other Secured Transaction Documents against such party or against any other Person, including but not limited
to, any Grantor.

 

(c)          To
the extent permitted by applicable law, each Grantor hereby waives promptness, diligence, notice of acceptance and any other notice
with respect to any of the Obligations and this Agreement and any requirement that the Collateral Agent exhaust any right or take
any action against any other Person or any Collateral. Each Grantor acknowledges that it will receive direct and indirect benefits
from the financing arrangements contemplated herein and that the waiver set forth in this Section 10(c) is knowingly
made in contemplation of such benefits. The Grantors hereby waive any right to revoke this Agreement, and acknowledge that this
Agreement is continuing in nature and applies to all Obligations, whether existing now or in the future.

 

    	-21-

    	 

    

 

(d)          No
Grantor may exercise any rights that it may now or hereafter acquire against any other Grantor that arise from the existence, payment,
performance or enforcement of any Grantor's obligations under this Agreement, including, without limitation, any right of subrogation,
reimbursement, exoneration, contribution or indemnification and any right to participate in any claim or remedy of the Collateral
Agent against any Grantor or any Collateral, whether or not such claim, remedy or right arises in equity or under contract, statute
or common law, including, without limitation, the right to take or receive from any Grantor, directly or indirectly, in cash or
other property or by set-off or in any other manner, payment or security solely on account of such claim, remedy or right, unless
and until the complete conversion of all of the Company's obligations under the Notes to equity securities of the Company and/or
payment in full in cash of all obligations under the Notes (together with any matured indemnification obligations as of the date
of such conversion and/or payment, but excluding any inchoate or unmatured contingent indemnification obligations). If any amount
shall be paid to a Grantor in violation of the immediately preceding sentence at any time prior to the complete conversion of all
of the Company's obligations under the Notes to equity securities of the Company and/or payment in full in cash of all obligations
under the Notes (together with any matured indemnification obligations as of the date of such conversion and/or payment, but excluding
any inchoate or unmatured contingent indemnification obligations), such amount shall be held in trust for the benefit of the Collateral
Agent and shall forthwith be paid to the Collateral Agent to be credited and applied to the Obligations and all other amounts payable
under the Secured Transaction Documents, whether matured or unmatured, in accordance with the terms of the Secured Transaction
Documents, or to be held as Collateral for any Obligations or other amounts payable under the Secured Transaction Documents thereafter
arising.

 

(e)          Any
provision of this Agreement that is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective
to the extent of such prohibition or unenforceability without invalidating the remaining portions hereof or thereof or affecting
the validity or enforceability of such provision in any other jurisdiction.

 

(f)          This
Agreement shall create a continuing security interest in the Collateral and shall (i) remain in full force and effect until the
complete conversion of all of the Company's obligations under the Notes to equity securities of the Company and/or payment in full
in cash of all obligations under the Notes (together with any matured indemnification obligations as of the date of such conversion
and/or payment, but excluding any inchoate or unmatured contingent indemnification obligations), and (ii) be binding on each Grantor
and all other Persons who become bound as debtor to this Agreement in accordance with Section 9-203(d) of the Code and shall inure,
together with all rights and remedies of the Collateral Agent and the Buyers hereunder, to the benefit of the Collateral Agent
and the Buyers and their respective permitted successors, transferees and assigns. Without limiting the generality of clause (ii)
of the immediately preceding sentence, without notice to any Grantor, the Collateral Agent and the Buyers may assign or otherwise
transfer their rights and obligations under this Agreement and any of the other Secured Transaction Documents, to any other Person
and such other Person shall thereupon become vested with all of the benefits in respect thereof granted to the Collateral Agent
and the Buyers herein or otherwise. Upon any such assignment or transfer, all references in this Agreement to the Collateral Agent
or any such Buyer shall mean the assignee of the Collateral Agent or such Buyer. None of the rights or obligations of any Grantor
hereunder may be assigned or otherwise transferred without the prior written consent of the Collateral Agent, and any such assignment
or transfer without the consent of the Collateral Agent shall be null and void.

 

    	-22-

    	 

    

 

(g)          Upon
receipt or delivery by any Grantor of any notice in accordance with the terms of this Agreement unless the Company has in good
faith determined that the matters relating to such notice do not constitute material, nonpublic information relating to the Company
or its Subsidiaries, the Company shall within two (2) Business Days after any such receipt or delivery publicly disclose such material,
nonpublic information on a Current Report on Form 8-K or otherwise. In the event that the Company believes that a notice contains
material, nonpublic information relating to the Company or its Subsidiaries, the Company so shall indicate to the Collateral Agent
and the Buyers contemporaneously with delivery of such notice, and in the absence of any such indication, the Collateral Agent
and any Buyer shall be allowed to presume that all matters relating to such notice do not constitute material, nonpublic information
relating to the Company or its Subsidiaries.

 

(h)          Upon
the complete conversion of all of the Company's obligations under the Notes to equity securities of the Company and/or payment
in full in cash of all obligations under the Notes (together with any matured indemnification obligations as of the date of such
conversion and/or payment, but excluding any inchoate or unmatured contingent indemnification obligations), (i) this Agreement
and the security interests created hereby shall automatically terminate and all rights to the Collateral shall automatically revert
to the respective Grantor that granted such security interests hereunder, and (ii) the Collateral Agent will, upon such Grantor's
request and at such Grantor's expense, (A) return to such Grantor such of the Collateral as shall not have been sold or otherwise
disposed of or applied pursuant to the terms hereof, and (B) execute and deliver to such Grantor such documents as such Grantor
shall reasonably request to evidence such termination, all without any representation, warranty or recourse whatsoever.

 

(i)          THIS
AGREEMENT SHALL BE GOVERNED BY, CONSTRUED AND INTERPRETED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, EXCEPT AS REQUIRED
BY MANDATORY PROVISIONS OF LAW AND EXCEPT TO THE EXTENT THAT THE VALIDITY AND PERFECTION OR THE PERFECTION AND THE EFFECT OF PERFECTION
OR NON-PERFECTION OF THE SECURITY INTEREST CREATED HEREBY, OR REMEDIES HEREUNDER, IN RESPECT OF ANY PARTICULAR COLLATERAL ARE GOVERNED
BY THE LAW OF A JURISDICTION OTHER THAN THE STATE OF NEW YORK.

 

(j)          ANY
LEGAL ACTION, SUIT OR PROCEEDING WITH RESPECT TO THIS AGREEMENT OR ANY DOCUMENT RELATED THERETO MAY BE BROUGHT IN THE COURTS OF
THE STATE OF NEW YORK IN THE COUNTY OF NEW YORK OR THE UNITED STATES OF AMERICA FOR THE SOUTHERN DISTRICT OF NEW YORK, AND APPELLATE
COURTS THEREOF, AND, BY EXECUTION AND DELIVERY OF THIS AGREEMENT, EACH PARTY HEREBY ACCEPTS FOR ITSELF AND IN RESPECT OF ITS PROPERTY,
GENERALLY AND UNCONDITIONALLY, THE JURISDICTION OF THE AFORESAID COURTS. EACH PARTY HEREBY EXPRESSLY AND IRREVOCABLY WAIVES, TO
THE FULLEST EXTENT PERMITTED BY LAW, ANY OBJECTION, INCLUDING, WITHOUT LIMITATION, ANY OBJECTION TO THE LAYING OF VENUE OR BASED
ON THE GROUNDS OF FORUM NON CONVENIENS, WHICH IT MAY NOW OR HEREAFTER HAVE TO THE BRINGING OF ANY SUCH ACTION,
SUIT OR PROCEEDING IN SUCH RESPECTIVE JURISDICTIONS AND CONSENTS TO THE GRANTING OF SUCH LEGAL OR EQUITABLE RELIEF AS IS DEEMED
APPROPRIATE BY THE COURT.

 

    	-23-

    	 

    

 

(k)          EACH
PARTY AND (BY ITS ACCEPTANCE OF THE BENEFITS OF THIS AGREEMENT) THE COLLATERAL AGENT WAIVES ANY RIGHT IT MAY HAVE TO TRIAL BY JURY
IN RESPECT OF ANY LITIGATION BASED ON, ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS AGREEMENT OR ANY OF THE OTHER SECURED TRANSACTION
DOCUMENTS, OR ANY COURSE OF CONDUCT, COURSE OF DEALING, VERBAL OR WRITTEN STATEMENT OR OTHER ACTION OF THE PARTIES HERETO.

 

(l)          Nothing
contained herein shall affect the right of the Collateral Agent to serve process in any other manner permitted by law or commence
legal proceedings or otherwise proceed against any Grantor or any property of such Grantor in any other jurisdiction.

 

(m)          Each
Party irrevocably and unconditionally waives any right it may have to claim or recover in any legal action, suit or proceeding
referred to in this Section any special, exemplary, punitive or consequential damages.

 

(n)          Section
headings herein are included for convenience of reference only and shall not constitute a part of this Agreement for any other
purpose.

 

(o)          This
Agreement may be executed in any number of counterparts and by different parties hereto in separate counterparts, each of which
shall be deemed to be an original, but all of which taken together constitute one in the same Agreement.

 

[REMAINDER OF THIS PAGE INTENTIONALLY LEFT
BLANK]

 

    	-24-

    	 

    

 

IN WITNESS WHEREOF, each
Grantor has caused this Agreement to be executed and delivered by its officer thereunto duly authorized, as of the date first above
written.

 

	 	ENERPULSE TECHNOLOGIES, INC., a 
	 	Nevada corporation
	 	 	 
	 	By:	 
	 	 	Name:
	 	 	Title:
	 	 	 
	 	Address for Notices:
	 	2451 Alamo Ave. NE,
	 	Albuquerque, New Mexico 87106
	 	Attention:  	Bryan Templeton,
	 	 	Chief Financial Officer
	 	Telephone:	   (505) 842-5201
	 	Facsimile:	   (505) 213-0013
	 	 	 	 

 

 

	 	ENERPULSE, INC., a Delaware corporation
	 	
	 	 	 
	 	By:	 
	 	 	Name:
	 	 	Title:
	 	 	 
	 	Address for Notices:
	 	2451 Alamo Ave. NE,
	 	Albuquerque, New Mexico 87106
	 	Attention:  	Bryan Templeton,
	 	 	Chief Financial Officer
	 	Telephone:	   (505) 842-5201
	 	Facsimile:	   (505) 213-0013
	 	 	 	 

 

pledge
and security agreement

 

    	 

    	 

    

 

ACCEPTED BY:

 

AIGH Investment Partners, LLC

as Collateral Agent

 

	By:	 	 
	 	Name:  	 
	 	Title:	 
	 	Address:  6006 Berkeley Ave., Baltimore, MD 21209	 

 

pledge
and security agreement 

 

    	 

    	 

    

 

 

SCHEDULE I

LEGAL NAMES; ORGANIZATIONAL IDENTIFICATION NUMBERS; STATES OR JURISDICTION OF ORGANIZATION

 

	
         

         

        Legal
        Name:
	 	
        State
        of

        Organization:
	 	
        Type
        of

        Organization:
	 	
        Organizational

        Identification
        

        Number:

	Enerpulse Technologies, Inc.	 	Nevada	 	Corporation	 	[_________]
	Enerpulse, Inc.	 	Delaware	 	Corporation	 	[_________]

 

    	Sched. I-1

    	 

    

  

SCHEDULE II

INTELLECTUAL PROPERTY AND LICENSES; TRADE
NAMES

 

		A.	COPYRIGHTS

 

		1.	Registered Copyrights

 

[____________]

 

		2.	Copyright Applications

 

[____________]

 

		3.	Copyright Licenses

 

[____________]

 

		B.	PATENTS

 

		1.	Patents

 

[____________]

 

		2.	Patent Applications

 

[____________]

 

		3.	Patent Licenses

 

[____________]

 

		C.	TRADEMARKS

 

		1.	Registered Trademarks

 

[____________]

 

		2.	Trademark Applications

 

[____________]

 

		3.	Trademark Licenses

 

[____________]

 

    	Sched. II-1

    	 

    

  

		D.	OTHER PROPRIETARY RIGHTS

 

[____________]

 

		E.	TRADE NAMES

 

[____________]

 

		F.	NAME OF, AND EACH TRADE NAME USED BY, EACH PERSON FROM WHICH A GRANTOR HAS ACQUIRED ANY SUBSTANTIAL PART OF THE COLLATERAL
WITHIN THE PRECEDING FIVE YEARS

 

[____________]

 

    	Sched. II-2

    	 

    

 

SCHEDULE III

 

LOCATIONS

 

	Grantor:	 	Location:	 	Description:
	Enerpulse Technologies, Inc.	 	2451 Alamo Ave. NE, 

Albuquerque, New Mexico

 87106	 	Chief Executive Office
	Enerpulse, Inc.	 	2451 Alamo Ave. NE, 

Albuquerque, New Mexico

 87106	 	Chief Executive Office

 

    	Sched. III-1

    	 

    

 

SCHEDULE IV

PROMISSORY NOTES, SECURITIES, DEPOSIT ACCOUNTS, SECURITIES ACCOUNTS AND COMMODITIES ACCOUNTS

 

A. Promissory Notes:

 

[_____________]

 

B. Securities and Other Instruments:

 

[_____________]

 

C. Deposit Accounts, Securities Accounts and
Commodities Accounts:

 

	Grantor:	 	Name and Address 

of Institution 

Maintaining 

Account:	 	Account Number:	 	Type of Account:
	[_________]	 	[_________]	 	[_________]	 	[_________]
	[_________]	 	[_________]	 	[_________]	 	[_________]

 

    	Sched. IV-1

    	 

    

 

SCHEDULE V

 

UCC-1 FINANCING
STATEMENTS

 

	Name of Grantor:	 	Secretary of State:
	Enerpulse Technologies, Inc.	 	Nevada
	Enerpulse, Inc.	 	Delaware

 

    	Sched. V-1

    	 

    

 

SCHEDULE VI

 

COMMERCIAL TORT CLAIMS

 

[_____________]

 

    	Sched. VI-1

    	 

    

 

SCHEDULE
VII

PLEDGED DEBT

 

[_____________]

 

    	Sched. VII-1

    	 

    

 

SCHEDULE
VIII

PLEDGED SHARES

 

	
         

        Grantor:
	 	Name of Pledged Issuer:	 	Number of Shares/Units:	 	
        Percentage

        of

        Outstanding
        Shares/Units:
	 	Class:	 	Certificate

 Number:
	
        Enerpulse Technologies,

        Inc.
	 	Enerpulse, Inc.	 	[______]	 	100]	 	Common Stock	 	[_______]
	 	 	 	 	 	 	 	 	 	 	 

 

    	Sched. VIII-1

    	 

    

 

EXHIBIT A

 

ASSIGNMENT FOR SECURITY

[TRADEMARKS] [PATENTS] [COPYRIGHTS]

 

WHEREAS, ______________________________
(the "Assignor") [has adopted, used and is using, and holds all right, title and interest in and to, the trademarks
and service marks listed on the annexed Schedule 1A, which trademarks and service marks are registered or applied for
in the United States Patent and Trademark Office (the "Trademarks")] [holds all right, title and interest in the
letter patents, design patents and utility patents listed on the annexed Schedule 1A, which patents are issued or applied
for in the United States Patent and Trademark Office (the "Patents")] [holds all right, title and interest in
the copyrights listed on the annexed Schedule 1A, which copyrights are registered in the United States Copyright Office
(the "Copyrights")];

 

WHEREAS, the Assignor has
entered into a Pledge and Security Agreement, dated as of [______ __], 2015 (as amended, restated or otherwise modified from time
to time the "Security Agreement"), in favor of AIGH Investment Partners, LLC, as collateral agent
for certain buyers (the "Assignee");

 

WHEREAS, pursuant to the
Security Agreement, the Assignor has assigned to the Assignee and granted to the Assignee for the benefit of the Buyers (as defined
in the Security Agreement) a continuing security interest in all right, title and interest of the Assignor in, to and under the
[Trademarks, together with, among other things, the good-will of the business symbolized by the Trademarks] [Patents] [Copyrights]
and the applications and registrations thereof, and all proceeds thereof, including, without limitation, any and all causes of
action which may exist by reason of infringement thereof and any and all damages arising from past, present and future violations
thereof (the "Collateral"), to secure the payment, performance and observance of the "Obligations" (as
defined in the Security Agreement);

 

NOW, THEREFORE, for good
and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Assignor does hereby pledge, convey,
sell, assign, transfer and set over unto the Assignee and grants to the Assignee for the benefit of the Buyers a continuing security
interest in the Collateral to secure the prompt payment, performance and for the benefit of the Buyers observance of the Obligations.

 

The Assignor does hereby
further acknowledge and affirm that the rights and remedies of the Assignee with respect to the Collateral are more fully set forth
in the Security Agreement, the terms and provisions of which are hereby incorporated herein by reference as if fully set forth
herein.

 

    	Exh. A-1

    	 

    

 

IN WITNESS WHEREOF, the Assignor
has caused this Assignment for Security to be duly executed by its officer thereunto duly authorized as of _____________, 20__

 

	 	[GRANTOR]
	 	 
	 	By:____________________________
	 	Name:
	 	Title: 

 

    	Exh. A-2

    	 

    

 

SCHEDULE 1A TO ASSIGNMENT
FOR SECURITY

 

	[Trademarks and Trademark Applications]	 
	[Patent and Patent Applications]	 
	[Copyright and Copyright Applications]	 
	Owned by	 	 
	 	 	 

 

    	Exh. A-3

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00240-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00240-of-00352.parquet"}]]