Document:

Exhibit 10.1

 

SECURITIES PURCHASE AGREEMENT

 

This Securities Purchase
Agreement (this “Agreement”) is dated as of              
between Electronic Cigarettes International Group, Ltd., a Nevada corporation (the “Company”), and each purchaser
identified on the signature pages hereto (each, including its successors and assigns, a “Purchaser” and collectively,
the “Purchasers”).

 

WHEREAS, subject to
the terms and conditions set forth in this Agreement and pursuant to Section 4(a)(2) of the Securities Act of 1933, as amended
(the “Securities Act”), and Rule 506 of Regulation D promulgated thereunder, the Company desires to issue and
sell to each Purchaser, and each Purchaser, severally and not jointly, desires to purchase from the Company, securities of the
Company as more fully described in this Agreement.

 

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

 

ARTICLE I. 

DEFINITIONS

 

1.1            
Definitions. In addition to the terms defined elsewhere in this Agreement: (a) capitalized terms that are not otherwise
defined herein have the meanings given to such terms in the Notes (as defined herein), and (b) the following terms have the meanings
set forth in this Section 1.1:

 

“Acquiring
Person” shall have the meaning ascribed to such term in Section 4.7.

 

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

 

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

 

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

 

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

 

“Closing
Dates” means the Trading Day(s) on which all of the Transaction Documents have been executed and delivered by the applicable
parties thereto in connection with a Closing, and all conditions precedent to (i) the Purchasers’ obligations to pay the
Subscription Amount as to such Closing and (ii) the Company’s obligations to deliver the Securities as to such Closing, in
each case, have been satisfied or waived.

 

“Closing”
means one or more closings of the purchase and sale of the Securities pursuant to Section 2.1.

 

 

    	1

    	 

    

 

“Closing
Statement” means the Closing Statement in the form on Annex A attached hereto.

 

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

 

“Common
Stock” means the common stock of the Company, par value $0.001 per share, and any other class of securities into which
such securities may hereafter be reclassified or changed.

 

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

 

“Conversion
Price” shall have the meaning ascribed to such term in the Notes.

 

“Conversion
Shares” shall have the meaning ascribed to such term in the Notes.

 

“Disclosure
Schedules” shall have the meaning ascribed to such term in Section 3.1.

 

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

 

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

 

“Exempt
Issuance” means the issuance of (a) shares of Common Stock or options to employees, officers or directors of the Company
pursuant to any stock or option plan duly adopted for such purpose, by a majority of the non-employee members of the Board of Directors
or a majority of the members of a committee of non-employee directors established for such purpose, (b) securities upon the exercise
or exchange of or conversion of any Securities issued hereunder and/or other securities exercisable or exchangeable for or convertible
into shares of Common Stock issued and outstanding on the date of this Agreement, provided that such securities have not been amended
since the date of this Agreement to increase the number of such securities or to decrease the exercise price, exchange price or
conversion price of such securities, (c) securities issued pursuant to acquisitions or strategic transactions approved by a majority
of the disinterested directors of the Company, provided that any such issuance shall only be to a Person (or to the equityholders
of a Person) which is, itself or through its subsidiaries, an operating company or an owner of an asset in a business synergistic
with the business of the Company and shall provide to the Company additional benefits in addition to the investment of funds, but
shall not include a transaction in which the Company is issuing securities primarily for the purpose of raising capital or to an
entity whose primary business is investing in securities and (d) an offering of at least $15,000,000 of Common Stock and/or Common
Stock equivalents in the aggregate to one or more institutional investors in one or more related closings.

 

 

    	2

    	 

    

 

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

 

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

 

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

 

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

 

“Legend
Removal Date” shall have the meaning ascribed to such term in Section 4.1(c).

 

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

 

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

 

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

 

“Maximum
Rate” shall have the meaning ascribed to such term in Section 5.17.

 

“Notes”
means the 5% Original Issue Discount Convertible Promissory Notes due, subject to the terms therein, 12 months from their date
of issuance, issued by the Company to the Purchasers hereunder, in the form of Exhibit A attached hereto.

 

“Participation
Maximum” shall have the meaning ascribed to such term in Section 4.12(a).

 

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

 

“Pre-Notice”
shall have the meaning ascribed to such term in Section 4.12(b).

 

“Principal
Amount” means, as to each Purchaser, the amounts set forth below such Purchaser’s signature block on the signature
pages hereto next to the heading “Principal Amount,” in United States Dollars, which shall equal such Purchaser’s
Subscription Amount as to the Closing.

 

“Pro
Rata Portion” shall have the meaning ascribed to such term in Section 4.12(e).

 

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

 

    	3

    	 

    

 

“Public
Information Failure” shall have the meaning ascribed to such term in Section 4.3(b).

 

“Public
Information Failure Payments” shall have the meaning ascribed to such term in Section 4.3(b).

 

“Purchaser
Party” shall have the meaning ascribed to such term in Section 4.10.

 

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

 

“Required
Minimum” means, as of any date, the maximum aggregate number of shares of Common Stock then issued or potentially issuable
in the future pursuant to the Transaction Documents, including any Underlying Shares issuable upon conversion in full of all Notes
(including Underlying Shares issuable as payment of interest on the Notes), ignoring any conversion or exercise limits set forth
therein.

 

“Robinson
Brog” means Robinson Brog Leinwand Greene Genovese & Gluck P.C., with offices located at 875 Third Avenue, New York,
New York 10022.

 

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

 

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

 

 

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

 

“Securities”
means the Notes and the Underlying Shares.

 

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

 

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

 

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

 

“Subsequent
Financing” shall have the meaning ascribed to such term in Section 4.12(a).

 

    	4

    	 

    

 

 

“Subsequent
Financing Notice” shall have the meaning ascribed to such term in Section 4.12(b).

 

“Subsidiary”
means any subsidiary of the Company as set forth on Schedule 3.1(a) and shall, where applicable, also include any direct
or indirect subsidiary of the Company formed or acquired after the date hereof.

 

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

 

“Trading
Market” means any of the following markets or exchanges on which the Common Stock is listed or quoted for trading on
the date in question: the NYSE MKT, the Nasdaq Capital Market, the Nasdaq Global Market, the Nasdaq Global Select Market, the New
York Stock Exchange, the OTC Bulletin Board or the “pink sheets” (or any successors to any of the foregoing).

 

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

 

“Transfer
Agent” means Nevada Agency and Transfer Company, the current transfer agent of the Company, with a mailing address of
50 West Liberty Street, Suite 880, Reno, Nevada 89501 and a telephone number of (775) 322-0626, and any successor transfer agent
of the Company.

 

“Transfer
Agent Instruction Letter” means the letter from the Company to the Transfer Agent which instructs the Transfer Agent
to issue Underlying Shares pursuant to the Transaction Documents, in the form of Exhibit B attached hereto.

 

“Underlying
Shares” means the shares of Common Stock issued and issuable upon conversion or redemption of the Notes and issued and
issuable in lieu of the cash payment of interest on the Notes in accordance with the terms of the Notes.

 

“Variable
Rate Transaction” shall have the meaning ascribed to such term in Section 4.13(b).

 

“VWAP”
means, for any date, the price determined by the first of the following clauses that applies: (a) if the Common Stock is then listed
or quoted on a Trading Market, the daily volume weighted average price of the Common Stock for such date (or the nearest preceding
date) on the Trading Market on which the Common Stock is then listed or quoted as reported by Bloomberg L.P. (based on a Trading
Day from 9:30 a.m. (New York City time) to 4:02 p.m. (New York City time)), (b)  if the OTC Bulletin Board is not a Trading
Market, the volume weighted average price of the Common Stock for such date (or the nearest preceding date) on the OTC Bulletin
Board, (c) if the Common Stock is not then listed or quoted for trading on the OTC Bulletin Board and if prices for the Common
Stock are then reported in the “Pink Sheets” published by Pink OTC Markets, Inc. (or a similar organization or agency
succeeding to its functions of reporting prices), the most recent bid price per share of the Common Stock so reported, or (d) in
all other cases, the fair market value of a share of Common Stock as determined by an independent appraiser selected in good faith
by the Purchasers of a majority in interest of the Securities then outstanding and reasonably acceptable to the Company, the fees
and expenses of which shall be paid by the Company.

 

    	5

    	 

    

 

 

ARTICLE II. 

PURCHASE AND SALE

 

2.1             
Purchase. The Purchasers will purchase an aggregate of up to $         in
Subscription Amount corresponding to an aggregate of up to $            
in Principal Amount of Notes at three Closings. The first Closing will occur upon execution of this Agreement and the second closing
will occur fourteen (14) days following the first Closing. The Company must file a Form 14A with the Commission to increase the
number of authorized but unissued shares of Common Stock so that at least 200% of the Required Minimum are available for issuance
upon conversion of this Note and payment of interest on this Note at such time, calculated on a monthly basis. The Form 14A must
be filed within seven (7) Business Days after the first Closing or the Purchaser is not obligated to make the subsequent purchases.

 

2.2             
Closing. On each Closing Date, upon the terms and subject to the conditions set forth herein, substantially concurrent
with the execution and delivery of this Agreement by the parties hereto, the Company agrees to sell, and each Purchaser, severally
and not jointly, agrees to purchase, such Purchaser’s Closing Subscription Amount as set forth on the signature page hereto
executed by such Purchaser (an aggregate of up to $          in Subscription Amount
corresponding to an aggregate of up to $          in Principal Amount of Notes.) At
each Closing, each Purchaser shall deliver to the Company, via wire transfer or a certified check, immediately available funds
equal to such Purchaser’s Subscription Amount as set forth on the signature page hereto executed by such Purchaser, and the
Company shall deliver to each Purchaser its respective shares of Notes, as determined pursuant to Section 2.3(a), and the Company
and each Purchaser shall deliver the other items set forth in Section 2.3 deliverable at the Closing. Upon satisfaction of the
covenants and conditions set forth in Sections 2.3 and 2.4 for the Closing, each Closing shall occur at the offices of Robinson
Brog or such other location as the parties shall mutually agree.

 

2.3             
Deliveries.

 

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

 

		(i)	  this Agreement duly executed by the Company;

 

(ii)            the Transfer Agent Instruction Letter duly executed by the Company and the Transfer Agent; and

 

(iii)           a
Note with a principal amount equal to such Purchaser’s Principal Amount, registered in the name of such Purchaser.

 

    	6

    	 

    

 

 

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

 

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

 

(ii)            such
Purchaser’s Subscription Amount by wire transfer to the account specified in writing by the Company.

 

2.4             
Closing Conditions.

 

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

 

(i)                
the accuracy in all material respects on the Closing Date of the representations and warranties of the Purchasers contained
herein (unless as of a specific date therein in which case they shall be accurate as of such date);

 

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

 

(iii)            
the delivery by each Purchaser of the items set forth in Section 2.3(b) of this Agreement.

 

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

 

(i)                
the accuracy in all material respects when made and on the Closing Date of the representations and warranties of the Company
contained herein (unless as of a specific date therein);

 

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

 

(iii)            
the delivery by the Company of the items set forth in Section 2.3(a) of this Agreement.

 

 

ARTICLE III. 

REPRESENTATIONS AND WARRANTIES

 

3.1          
Representations and Warranties of the Company. Except as set forth in the Disclosure Schedules, which Disclosure
Schedules shall be deemed a part hereof and shall qualify any representation or otherwise made herein to the extent of the disclosure
contained in the corresponding section of the Disclosure Schedules, the Company hereby makes the following representations and
warranties to each Purchaser:

 

(a)               
Subsidiaries. All of the direct and indirect subsidiaries of the Company are set forth on Schedule 3.1(a).
The Company owns, directly or indirectly, all of the capital stock or other equity interests of each Subsidiary free and clear
of any Liens, and all of the issued and outstanding shares of capital stock of each Subsidiary are validly issued and are fully
paid, non-assessable and free of preemptive and similar rights to subscribe for or purchase securities. If the Company has no subsidiaries,
all other references to the Subsidiaries or any of them in the Transaction Documents shall be disregarded.

 

    	7

    	 

    

 

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

 

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

 

    	8

    	 

    

 

 

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

 

(e)               
Filings, Consents and Approvals. The Company is not required to obtain any consent, waiver, authorization or order
of, give any notice to, or make any filing or registration with, any court or other federal, state, local or other governmental
authority or other Person in connection with the execution, delivery and performance by the Company of the Transaction Documents,
other than: (i) the filings required pursuant to Section 4.6 of this Agreement, (ii) the notice and/or application(s) to each applicable
Trading Market for the issuance and sale of the Securities and the listing of the Conversion Shares for trading thereon in the
time and manner required thereby and (iii) the filing of Form D with the Commission and such filings as are required to be made
under applicable state securities laws (collectively, the “Required Approvals”).

 

(f)               
Issuance of the Securities. The Securities are duly authorized and, when issued and paid for in accordance with the
applicable Transaction Documents, will be duly and validly issued, fully paid and nonassessable, free and clear of all Liens imposed
by the Company other than restrictions on transfer provided for in the Transaction Documents. The Underlying Shares, when issued
in accordance with the terms of the Transaction Documents, will be validly issued, fully paid and nonassessable, free and clear
of all Liens imposed by the Company other than restrictions on transfer provided for in the Transaction Documents. The Company
has reserved from its duly authorized capital stock a number of shares of Common Stock for issuance of the Underlying Shares at
least equal to 15,000,000 on the date hereof.

 

    	9

    	 

    

 

 

(g)              
Capitalization. The capitalization of the Company is as set forth on Schedule 3.1(g), which Schedule 3.1(g)
shall also include the number of shares of Common Stock owned beneficially, and of record, by Affiliates of the Company as of the
date hereof. Except as disclosed on Schedule 3.1(g), the Company has not issued any capital stock since its most recently
filed periodic report under the Exchange Act, other than pursuant to the exercise of employee stock options under the Company’s
stock option plans, the issuance of shares of Common Stock to employees pursuant to the Company’s employee stock purchase
plans and pursuant to the conversion and/or exercise of Common Stock Equivalents outstanding as of the date of the most recently
filed periodic report under the Exchange Act. No Person has any right of first refusal, preemptive right, right of participation,
or any similar right to participate in the transactions contemplated by the Transaction Documents as a result of the purchase and
sale of the Securities. Other than as set forth on Schedule 3.1(g), there are no outstanding options, warrants, scrip rights
to subscribe to, calls or commitments of any character whatsoever relating to, or securities, rights or obligations convertible
into or exercisable or exchangeable for, or giving any Person any right to subscribe for or acquire any shares of Common Stock,
or contracts, commitments, understandings or arrangements by which the Company or any Subsidiary is or may become bound to issue
additional shares of Common Stock or Common Stock Equivalents. All of the outstanding shares of capital stock of the Company are
duly authorized, validly issued, fully paid and nonassessable, have been issued in compliance with all federal and state securities
laws, and none of such outstanding shares was issued in violation of any preemptive rights or similar rights to subscribe for or
purchase securities. No further approval or authorization of any stockholder, the Board of Directors or others is required for
the issuance and sale of the Securities. There are no stockholders agreements, voting agreements or other similar agreements with
respect to the Company’s capital stock to which the Company is a party or, to the knowledge of the Company, between or among
any of the Company’s stockholders.

 

(h)              
SEC Reports; Financial Statements. Except as disclosed on Schedule 3.1(h), the Company has filed all reports,
schedules, forms, statements and other documents required to be filed by the Company under the Securities Act and the Exchange
Act, including pursuant to Section 13(a) or 15(d) thereof, for the two years preceding the date hereof (or such shorter period
as the Company was required by law or regulation to file such material) (the foregoing materials, including the exhibits thereto
and documents incorporated by reference therein, being collectively referred to herein as the “SEC Reports”)
on a timely basis or has received a valid extension of such time of filing and has filed any such SEC Reports prior to the expiration
of any such extension. As of their respective dates, the SEC Reports complied in all material respects with the requirements of
the Securities Act and the Exchange Act, as applicable, and none of the SEC Reports, when filed, contained any untrue statement
of a material fact or omitted to state a material fact required to be stated therein or necessary in order to make the statements
therein, in the light of the circumstances under which they were made, not misleading. The financial statements of the Company
included in the SEC Reports comply in all material respects with applicable accounting requirements and the rules and regulations
of the Commission with respect thereto as in effect at the time of filing. Such financial statements have been prepared in accordance
with United States generally accepted accounting principles applied on a consistent basis during the periods involved (“GAAP”),
except as may be otherwise specified in such financial statements or the notes thereto and except that unaudited financial statements
may not contain all footnotes required by GAAP, and fairly present in all material respects the financial position of the Company
and its consolidated Subsidiaries as of and for the dates thereof and the results of operations and cash flows for the periods
then ended, subject, in the case of unaudited statements, to normal, immaterial, year-end audit adjustments.

 

    	10

    	 

    

 

 

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

 

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

 

    	11

    	 

    

 

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

 

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

 

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

 

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

 

    	12

    	 

    

 

 

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

 

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

 

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

 

    	13

    	 

    

 

 

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

 

(s)               
Certain Fees. Other than as set forth on Schedule 3.1(s), no brokerage or finder’s fees or commissions
are or will be payable by the Company or any Subsidiaries to any broker, financial advisor or consultant, finder, placement agent,
investment banker, bank or other Person with respect to the transactions contemplated by the Transaction Documents. The Purchasers
shall have no obligation with respect to any fees or with respect to any claims made by or on behalf of other Persons for fees
of a type contemplated in this Section that may be due in connection with the transactions contemplated by the Transaction Documents.

 

(t)                
Private Placement. Assuming the accuracy of the Purchasers’ representations and warranties set forth in Section
3.2, no registration under the Securities Act is required for the offer and sale of the Securities by the Company to the Purchasers
as contemplated hereby. The issuance and sale of the Securities hereunder does not contravene the rules and regulations of the
Trading Market.

 

    	14

    	 

    

 

 

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

 

(v)              
Registration Rights. Other than as disclosed on Schedule 3.1(v), no Person has any right to cause the Company
to effect the registration under the Securities Act of any securities of the Company or any Subsidiaries.

 

(w)            
Listing and Maintenance Requirements. The Common Stock is registered pursuant to Section 12(b) or 12(g) of the Exchange
Act, and the Company has taken no action designed to, or which to its knowledge is likely to have the effect of, terminating the
registration of the Common Stock under the Exchange Act nor has the Company received any notification that the Commission is contemplating
terminating such registration. The Company has not, in the 12 months preceding the date hereof, received notice from any Trading
Market on which the Common Stock is or has been listed or quoted to the effect that the Company is not in compliance with the listing
or maintenance requirements of such Trading Market. The Company is, and has no reason to believe that it will not in the foreseeable
future continue to be, in compliance with all such listing and maintenance requirements.

 

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

 

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

 

    	15

    	 

    

 

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

 

(aa)           
Solvency. Based on the consolidated financial condition of the Company as of the Closing Date, after giving effect
to the receipt by the Company of the proceeds from the sale of the Securities hereunder: (i) the fair saleable value of the Company’s
assets exceeds the amount that will be required to be paid on or in respect of the Company’s existing debts and other liabilities
(including known contingent liabilities) as they mature, (ii) the Company’s assets do not constitute unreasonably small capital
to carry on its business as now conducted and as proposed to be conducted including its capital needs taking into account the particular
capital requirements of the business conducted by the Company, consolidated and projected capital requirements and capital availability
thereof, and (iii) the current cash flow of the Company, together with the proceeds the Company would receive, were it to liquidate
all of its assets, after taking into account all anticipated uses of the cash, would be sufficient to pay all amounts on or in
respect of its liabilities when such amounts are required to be paid. The Company does not intend to incur debts beyond its ability
to pay such debts as they mature (taking into account the timing and amounts of cash to be payable on or in respect of its debt).
The Company has no knowledge of any facts or circumstances which lead it to believe that it will file for reorganization or liquidation
under the bankruptcy or reorganization laws of any jurisdiction within one year from the Closing Date. Schedule 3.1(aa)
sets forth as of the date hereof all outstanding secured and unsecured Indebtedness of the Company or any Subsidiary, or for which
the Company or any Subsidiary has commitments. For the purposes of this Agreement, “Indebtedness” means (x)
any liabilities for borrowed money or amounts owed in excess of $250,000 (other than trade accounts payable incurred in the ordinary
course of business), (y) all guaranties, endorsements and other contingent obligations in respect of indebtedness of others, whether
or not the same are or should be reflected in the Company’s consolidated balance sheet (or the notes thereto), except guaranties
by endorsement of negotiable instruments for deposit or collection or similar transactions in the ordinary course of business;
and (z) the present value of any lease payments in excess of $250,000 due under leases required to be capitalized in accordance
with GAAP. Neither the Company nor any Subsidiary is in default with respect to any Indebtedness.

 

    	16

    	 

    

 

 

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

 

(cc)           
No General Solicitation. Neither the Company nor any person acting on behalf of the Company has offered or sold any
of the Securities by any form of general solicitation or general advertising. The Company has offered the Securities for sale only
to the Purchasers and certain other “accredited investors” within the meaning of Rule 501 under the Securities Act.

 

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

 

(ee)           
Accountants. The Company’s independent registered public accounting firm is set forth on Schedule 3.1(ee)
of the Disclosure Schedules. To the knowledge and belief of the Company, such accounting firm: (i) is a registered public accounting
firm as required by the Exchange Act and (ii) shall express its opinion with respect to the financial statements to be included
in the Company’s Annual Report for the fiscal year ended December 31, 2014.

 

(ff)            
No Disagreements with Accountants and Lawyers. There are no disagreements of any kind presently existing, or reasonably
anticipated by the Company to arise, between the Company and the accountants and lawyers formerly or presently employed by the
Company and the Company is current with respect to any fees owed to its accountants and lawyers which could affect the Company’s
ability to perform any of its obligations under any of the Transaction Documents.

 

 

    	17

    	 

    

 

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

 

(hh)          
Acknowledgment Regarding Purchaser’s Trading Activity. Anything in this Agreement or elsewhere herein to the
contrary notwithstanding (except for Sections 3.2(f) and 4.15 hereof), it is understood and acknowledged by the Company that:
(i) none of the Purchasers has been asked by the Company to agree, nor has any Purchaser agreed, to desist from purchasing or
selling, long and/or short, securities of the Company, or “derivative” securities based on securities issued by the
Company or to hold the Securities for any specified term, (ii) past or future open market or other transactions by any Purchaser,
specifically including, without limitation, Short Sales or “derivative” transactions, before or after the closing
of this or future private placement transactions, may negatively impact the market price of the Company’s publicly-traded
securities, (iii) any Purchaser, and counter-parties in “derivative” transactions to which any such Purchaser is a
party, directly or indirectly, may presently have a “short” position in the Common Stock and (iv) each Purchaser shall
not be deemed to have any affiliation with or control over any arm’s length counter-party in any “derivative”
transaction. The Company further understands and acknowledges that (y) one or more Purchasers may engage in hedging activities
at various times during the period that the Securities are outstanding, including, without limitation, during the periods that
the value of the Underlying Shares deliverable with respect to Securities are being determined, and (z) such hedging activities
(if any) could reduce the value of the existing stockholders' equity interests in the Company at and after the time that the hedging
activities are being conducted.  The Company acknowledges that such aforementioned hedging activities do not constitute a
breach of any of the Transaction Documents.

 

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

 

    	18

    	 

    

 

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

 

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

 

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

 

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

 

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

 

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

 

    	19

    	 

    

 

 

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

 

(b)              
Own Account. Such Purchaser understands that the Securities are “restricted securities” and have not
been registered under the Securities Act or any applicable state securities law and is acquiring the Securities as principal for
its own account and not with a view to or for distributing or reselling such Securities or any part thereof in violation of the
Securities Act or any applicable state securities law, has no present intention of distributing any of such Securities in violation
of the Securities Act or any applicable state securities law and has no direct or indirect arrangement or understandings with any
other persons to distribute or regarding the distribution of such Securities in violation of the Securities Act or any applicable
state securities law (this representation and warranty not limiting such Purchaser’s right to sell the Securities in compliance
with applicable federal and state securities laws). Such Purchaser is acquiring the Securities hereunder in the ordinary course
of its business.

 

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

 

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

 

(e)               
General Solicitation. Such Purchaser is not purchasing the Securities as a result of any advertisement, article,
notice or other communication regarding the Securities published in any newspaper, magazine or similar media or broadcast over
television or radio or presented at any seminar or any other general solicitation or general advertisement.

 

    	20

    	 

    

 

 

(f)               
Certain Transactions and Confidentiality. Other than consummating the transactions contemplated hereunder, such Purchaser
has not directly or indirectly, nor has any Person acting on behalf of or pursuant to any understanding with such Purchaser, executed
any purchases or sales, including Short Sales, of the securities of the Company during the period commencing as of the time
that such Purchaser first received a term sheet (written or oral) from the Company or any other Person representing the Company
setting forth the material terms of the transactions contemplated hereunder and ending immediately prior to the execution hereof.
Notwithstanding the foregoing, in the case of a Purchaser that is a multi-managed investment vehicle whereby separate portfolio
managers manage separate portions of such Purchaser’s assets and the portfolio managers have no direct knowledge of the investment
decisions made by the portfolio managers managing other portions of such Purchaser’s assets, the representation set forth
above shall only apply with respect to the portion of assets managed by the portfolio manager that made the investment decision
to purchase the Securities covered by this Agreement. Other than to other Persons party to this Agreement, such Purchaser has maintained
the confidentiality of all disclosures made to it in connection with this transaction (including the existence and terms of this
transaction). Notwithstanding the foregoing, for avoidance of doubt, nothing contained herein shall constitute a representation
or warranty, or preclude any actions, with respect to the identification of the availability of, or securing of, available shares
to borrow in order to effect Short Sales or similar transactions in the future.

 

The Company acknowledges and agrees that
the representations contained in Section 3.2 shall not modify, amend or affect such Purchaser’s right to rely on the Company’s
representations and warranties contained in this Agreement or any representations and warranties contained in any other Transaction
Document or any other document or instrument executed and/or delivered in connection with this Agreement or the consummation of
the transaction contemplated hereby.

 

 

ARTICLE IV. 

OTHER AGREEMENTS OF THE PARTIES

 

4.1             
Transfer Restrictions.

 

(a)               
The Securities may only be disposed of in compliance with state and federal securities laws. In connection with any transfer
of Securities other than pursuant to an effective registration statement or Rule 144, to the Company or to an Affiliate of a Purchaser
or in connection with a pledge as contemplated in Section 4.1(b), the Company may require the transferor thereof to provide to
the Company an opinion of counsel selected by the transferor and reasonably acceptable to the Company, the form and substance of
which opinion shall be reasonably satisfactory to the Company, to the effect that such transfer does not require registration of
such transferred Securities under the Securities Act. As a condition of transfer, any such transferee shall agree in writing to
be bound by the terms of this Agreement and shall have the rights and obligations of a Purchaser under this Agreement.

 

    	21

    	 

    

 

 

(b)              
The Purchasers agree to the imprinting, so long as is required by this Section 4.1, of a legend on any of the Securities
in the following form:

 

[NEITHER] THIS SECURITY [NOR
THE SECURITIES INTO WHICH THIS SECURITY IS CONVERTIBLE] HAS [NOT] BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION OR
THE SECURITIES COMMISSION OF ANY STATE IN RELIANCE UPON AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED
(THE “SECURITIES ACT”), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT
UNDER THE SECURITIES ACT OR PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS
OF THE SECURITIES ACT AND IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS AS EVIDENCED BY A LEGAL OPINION OF COUNSEL TO THE
TRANSFEROR TO SUCH EFFECT, THE SUBSTANCE OF WHICH SHALL BE REASONABLY ACCEPTABLE TO THE COMPANY. THIS SECURITY [AND THE SECURITIES
ISSUABLE UPON CONVERSION OF THIS SECURITY] MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT WITH A REGISTERED BROKER-DEALER
OR OTHER LOAN WITH A FINANCIAL INSTITUTION THAT IS AN “ACCREDITED INVESTOR” AS DEFINED IN RULE 501(a) UNDER THE SECURITIES
ACT OR OTHER LOAN SECURED BY SUCH SECURITIES.

 

The Company
acknowledges and agrees that a Purchaser may from time to time pledge pursuant to a bona fide margin agreement with a registered
broker-dealer or grant a security interest in some or all of the Securities to a financial institution that is an “accredited
investor” as defined in Rule 501(a) under the Securities Act and who agrees to be bound by the provisions of this Agreement
and, if required under the terms of such arrangement, such Purchaser may transfer pledged or secured Securities to the pledgees
or secured parties. Such a pledge or transfer would not be subject to approval of the Company and no legal opinion of legal counsel
of the pledgee, secured party or pledgor shall be required in connection therewith. Further, no notice shall be required of such
pledge. At the appropriate Purchaser’s expense, the Company will execute and deliver such reasonable documentation as a pledgee
or secured party of Securities may reasonably request in connection with a pledge or transfer of the Securities.

 

    	22

    	 

    

 

 

(c)               
Certificates evidencing the Underlying Shares shall not contain any legend (including the legend set forth in Section 4.1(b)
hereof): (i) while a registration statement covering the resale of the Underlying Shares is effective under the Securities Act,
(ii) following any sale of such Underlying Shares pursuant to Rule 144, (iii) if such legend is not required under applicable requirements
of the Securities Act (including judicial interpretations and pronouncements issued by the staff of the Commission). The Company
shall cause its counsel to issue a legal opinion to the Transfer Agent promptly after any of the events described in (i)-(iii)
in the preceding sentence if required by the Transfer Agent to effect the removal of the legend hereunder (with a copy to the applicable
Purchaser and its broker). If all or any portion of the Notes is converted at a time when there is an effective registration statement
to cover the resale of the Underlying Shares, or if such Underlying Shares may be sold under Rule 144 or if such legend is not
otherwise required under applicable requirements of the Securities Act (including judicial interpretations and pronouncements issued
by the staff of the Commission) then such Underlying Shares shall be issued free of all legends. The Company agrees that following
such time as such legend is no longer required under this Section 4.1(c), it will, no later than three (3) Trading Days following
the delivery by a Purchaser to the Company or the Transfer Agent of a certificate representing Underlying Shares, as applicable,
issued with a restrictive legend (such third Trading Day, the “Legend Removal Date”), deliver or cause to be
delivered to such Purchaser a certificate representing such shares that is free from all restrictive and other legends. The Company
may not make any notation on its records or give instructions to the Transfer Agent that enlarge the restrictions on transfer set
forth in this Section 4. Certificates for Underlying Shares subject to legend removal hereunder shall be transmitted by the Transfer
Agent to the Purchaser by crediting the account of the Purchaser’s prime broker with the Depository Trust Company System
as directed by such Purchaser.

 

(d)              
In addition to such Purchaser’s other available remedies, the Company shall pay to a Purchaser, in cash, as partial
liquidated damages and not as a penalty, for each $1,000 of Underlying Shares (based on the VWAP of the Common Stock on the date
such Securities are submitted to the Transfer Agent) delivered for removal of the restrictive legend and subject to Section 4.1(c),
$10 per Trading Day (increasing to $20 per Trading Day five (5) Trading Days after such damages have begun to accrue) for each
Trading Day after the Legend Removal Date until such certificate is delivered without a legend. Nothing herein shall limit such
Purchaser’s right to pursue actual damages for the Company’s failure to deliver certificates representing any Securities
as required by the Transaction Documents, and such Purchaser shall have the right to pursue all remedies available to it at law
or in equity including, without limitation, a decree of specific performance and/or injunctive relief.

 

4.2             
Acknowledgment of Dilution. The Company acknowledges that the issuance of the Securities may result in dilution of
the outstanding shares of Common Stock, which dilution may be substantial under certain market conditions. The Company further
acknowledges that its obligations under the Transaction Documents, including, without limitation, its obligation to issue the Underlying
Shares pursuant to the Transaction Documents, are unconditional and absolute and not subject to any right of set off, counterclaim,
delay or reduction, regardless of the effect of any such dilution or any claim the Company may have against any Purchaser and regardless
of the dilutive effect that such issuance may have on the ownership of the other stockholders of the Company.

 

4.3             
Furnishing of Information; Public Information.

 

(a)               
Until the earliest of the time that no Purchaser owns Securities, the Company covenants to maintain the registration of
the Common Stock under Section 12(b) or 12(g) of the Exchange Act and to timely file (or obtain extensions in respect thereof and
file within the applicable grace period) all reports required to be filed by the Company after the date hereof pursuant to the
Exchange Act even if the Company is not then subject to the reporting requirements of the Exchange Act.

 

    	23

    	 

    

 

 

(b) At
any time during the period commencing from the six (6) month anniversary of the date hereof and ending at such time that all of
the Securities may be sold without the requirement for the Company to be in compliance with Rule 144(c)(1) and otherwise without
restriction or limitation pursuant to Rule 144, if the Company shall fail for any reason to satisfy the current public information
requirement under Rule 144(c) (a “Public Information Failure”) then, in addition to such Purchaser’s other
available remedies, the Company shall pay to a Purchaser, in cash, as partial liquidated damages and not as a penalty, by reason
of any such delay in or reduction of its ability to sell the Securities, an amount in cash equal to two percent (2.0%) of the aggregate
Subscription Amount of such Purchaser’s Securities on the day of a Public Information Failure and on every thirtieth (30th)
day (pro rated for periods totaling less than thirty days) thereafter until the earlier of (a) the date such Public Information
Failure is cured and (b) such time that such public information is no longer required  for the Purchasers to transfer the
Underlying Shares pursuant to Rule 144.  The payments to which a Purchaser shall be entitled pursuant to this Section 4.3(b)
are referred to herein as “Public Information Failure Payments.”  Public Information Failure Payments
shall be paid on the earlier of (i) the last day of the calendar month during which such Public Information Failure Payments
are incurred and (ii) the third (3rd) Business Day after the event or failure giving rise to the Public Information
Failure Payments is cured.  In the event the Company fails to make Public Information Failure Payments in a
timely manner, such Public Information Failure Payments shall bear interest at the rate of 1.5% per month (prorated for
partial months) until paid in full. Nothing herein shall limit such Purchaser’s right to pursue actual damages for the Public
Information Failure, and such Purchaser shall have the right to pursue all remedies available to it at law or in equity including,
without limitation, a decree of specific performance and/or injunctive relief.

 

4.4             
Integration. The Company shall not sell, offer for sale or solicit offers to buy or otherwise negotiate in respect
of any security (as defined in Section 2 of the Securities Act) that would be integrated with the offer or sale of the Securities
in a manner that would require the registration under the Securities Act of the sale of the Securities or that would be integrated
with the offer or sale of the Securities for purposes of the rules and regulations of any Trading Market such that it would require
shareholder approval prior to the closing of such other transaction unless shareholder approval is obtained before the closing
of such subsequent transaction.

 

4.5             
Conversion Procedures. The form of Notice of Conversion included in the Notes sets forth the totality of the
procedures required of the Purchasers in order to convert the Notes. Without limiting the preceding sentences, no ink-original
Notice of Conversion shall be required, nor shall any medallion guarantee (or other type of guarantee or notarization) of any Notice
of Conversion form be required in order to convert the Notes. Except as provided in Section 4.1(c), no additional legal opinion,
other information or instructions shall be required of the Purchasers to convert their Notes. The Company shall honor conversions
of the Notes and shall deliver Underlying Shares in accordance with the terms, conditions and time periods set forth in the Transaction
Documents.

 

 

    	24

    	 

    

 

4.6             
Securities Laws Disclosure; Publicity. The Company shall (a) by 9:30 a.m. (New York City time) on the second Trading
Day immediately following the Closing, issue a press release disclosing the material terms of the transactions contemplated hereby
and (b) file a Current Report on Form 8-K, including the Transaction Documents as exhibits thereto, with the Commission within
the time required by the Exchange Act. From and after the issuance of such press release, the Company represents to the Purchasers
that it shall have publicly disclosed all material, non-public information delivered to any of the Purchasers by the Company or
any of its Subsidiaries, or any of their respective officers, directors, employees or agents in connection with the transactions
contemplated by the Transaction Documents. The Company and each Purchaser shall consult with each other in issuing any other press
releases with respect to the transactions contemplated hereby, and neither the Company nor any Purchaser shall issue any such press
release nor otherwise make any such public statement without the prior consent of the Company, with respect to any press release
of any Purchaser, or without the prior consent of each Purchaser, with respect to any press release of the Company, which consent
shall not unreasonably be withheld or delayed, except if such disclosure is required by law, in which case the disclosing party
shall promptly provide the other party with prior notice of such public statement or communication. Notwithstanding the foregoing,
the Company shall not publicly disclose the name of any Purchaser, or include the name of any Purchaser in any filing with the
Commission or any regulatory agency or Trading Market, without the prior written consent of such Purchaser, except to the extent
such disclosure is required by law or Trading Market regulations, in which case the Company shall provide the Purchasers with prior
notice of such disclosure permitted under this clause (b).

 

4.7             
Shareholder Rights Plan. No claim will be made or enforced by the Company or, with the consent of the Company, any
other Person, that any Purchaser is an “Acquiring Person” under any control share acquisition, business combination,
poison pill (including any distribution under a rights agreement) or similar anti-takeover plan or arrangement in effect or hereafter
adopted by the Company, or that any Purchaser could be deemed to trigger the provisions of any such plan or arrangement, by virtue
of receiving Securities under the Transaction Documents or under any other agreement between the Company and the Purchasers.

 

4.8             
Non-Public Information. Except with respect to the material terms and conditions of the transactions contemplated
by the Transaction Documents, the Company covenants and agrees that neither it, nor any other Person acting on its behalf, will
provide any Purchaser or its agents or counsel with any information that the Company believes constitutes material non-public information,
unless prior thereto such Purchaser shall have entered into a written agreement with the Company regarding the confidentiality
and use of such information. The Company understands and confirms that each Purchaser shall be relying on the foregoing covenant
in effecting transactions in securities of the Company.

 

4.9             
Use of Proceeds. The Company shall use the net proceeds hereunder as set forth on Schedule 4.9 attached hereto,
and shall not use such proceeds: (a) for the satisfaction of any portion of the Company’s debt (other than payment of trade
payables in the ordinary course of the Company’s business and prior practices), (b) for the redemption of any Common Stock
or Common Stock Equivalents, (c) for the settlement of any outstanding litigation or (d) in violation of FCPA or OFAC regulations.

 

    	25

    	 

    

 

 

4.10         
Indemnification of Purchasers. Subject to the provisions of this Section 4.10, the Company will indemnify and hold
each Purchaser and its directors, officers, shareholders, members, partners, employees and agents (and any other Persons with a
functionally equivalent role of a Person holding such titles notwithstanding a lack of such title or any other title), each Person
who controls such Purchaser (within the meaning of Section 15 of the Securities Act and Section 20 of the Exchange Act), and the
directors, officers, shareholders, agents, members, partners or employees (and any other Persons with a functionally equivalent
role of a Person holding such titles notwithstanding a lack of such title or any other title) of such controlling persons (each,
a “Purchaser Party”) harmless from any and all losses, liabilities, obligations, claims, contingencies, damages,
costs and expenses, including all judgments, amounts paid in settlements, court costs and reasonable attorneys’ fees and
costs of investigation that any such Purchaser Party may suffer or incur as a result of or relating to (a) any breach of any of
the representations, warranties, covenants or agreements made by the Company in this Agreement or in the other Transaction Documents
or (b) any action instituted against the Purchaser Parties in any capacity, or any of them or their respective Affiliates, by any
stockholder of the Company who is not an Affiliate of such Purchaser Party, with respect to any of the transactions contemplated
by the Transaction Documents (unless such action is based upon a breach of such Purchaser Party’s representations, warranties
or covenants under the Transaction Documents or any agreements or understandings such Purchaser Party may have with any such stockholder
or any violations by such Purchaser Party of state or federal securities laws or any conduct by such Purchaser Party which constitutes
fraud, gross negligence, willful misconduct or malfeasance). If any action shall be brought against any Purchaser Party in respect
of which indemnity may be sought pursuant to this Agreement, such Purchaser Party shall promptly notify the Company in writing,
and the Company shall have the right to assume the defense thereof with counsel of its own choosing reasonably acceptable to the
Purchaser Party. Any Purchaser Party shall have the right to employ separate counsel in any such action and participate in the
defense thereof, but the fees and expenses of such counsel shall be at the expense of such Purchaser Party except to the extent
that (i) the employment thereof has been specifically authorized by the Company in writing, (ii) the Company has failed after a
reasonable period of time to assume such defense and to employ counsel or (iii) in such action there is, in the reasonable opinion
of counsel, a material conflict on any material issue between the position of the Company and the position of such Purchaser Party,
in which case the Company shall be responsible for the reasonable fees and expenses of no more than one such separate counsel.
The Company will not be liable to any Purchaser Party under this Agreement (y) for any settlement by a Purchaser Party effected
without the Company’s prior written consent, which shall not be unreasonably withheld or delayed; or (z) to the extent, but
only to the extent that a loss, claim, damage or liability is attributable to any Purchaser Party’s breach of any of the
representations, warranties, covenants or agreements made by such Purchaser Party in this Agreement or in the other Transaction
Documents. The indemnification required by this Section 4.10 shall be made by periodic payments of the amount thereof during the
course of the investigation or defense, as and when bills are received or are incurred. The indemnity agreements contained herein
shall be in addition to any cause of action or similar right of any Purchaser Party against the Company or others and any liabilities
the Company may be subject to pursuant to law.

 

4.11         
Reservation and Listing of Securities.

 

(a)               
The Company shall maintain a reserve from its duly authorized shares of Common Stock for issuance pursuant to the Transaction
Documents in such amount as may then be required to fulfill its obligations in full under the Transaction Documents.

 

    	26

    	 

    

 

(b)              
If, on any date, the number of authorized but unissued (and otherwise unreserved) shares of Common Stock is less than 200%
of the Required Minimum on such date, then the Board of Directors shall use commercially reasonable efforts to amend the Company’s
certificate or articles of incorporation to increase the number of authorized but unissued shares of Common Stock so that at least
200% of the Required Minimum shares of Common Stock are available for issuance upon conversion of this Note and payment of interest
on this Note at such time at such time, as soon as possible and in any event not later than the 75th day after such date.

 

(c)               
The Company shall, if applicable: (i) in the time and manner required by the principal Trading Market, prepare and file
with such Trading Market an additional shares listing application covering a number of shares of Common Stock at least equal to
the Required Minimum on the date of such application, (ii) take all steps necessary to cause such shares of Common Stock to be
approved for listing or quotation on such Trading Market as soon as possible thereafter, (iii) provide to the Purchasers evidence
of such listing or quotation and (iv) maintain the listing or quotation of such Common Stock on any date at least equal to the
Required Minimum on such date on such Trading Market or another Trading Market.

 

4.12         
Participation in Future Financing.

 

(a)               
Subject to any existing obligations of the Company, from the date hereof until the date that is the 12-month anniversary
of the Closing, upon any issuance by the Company or any of its Subsidiaries of Common Stock, Common Stock Equivalents or debt for
cash consideration, Indebtedness or a combination of units hereof, other than any issuance that is through a public underwritten
offering or to an investor or a group of investors that already own Common Stock or Common Stock Equivalents (a “Subsequent
Financing”), each Purchaser shall have the right to participate in the Subsequent Financing in an amount up to 100% of
such Purchaser’s Subscription Amount (the “Participation Maximum”) on the same terms, conditions and price
provided for in the Subsequent Financing.

 

(b)              
At least five (5) Trading Days prior to the closing of the Subsequent Financing, the Company shall deliver to each Purchaser
a written notice of its intention to effect a Subsequent Financing (“Pre-Notice”), which Pre-Notice shall ask
such Purchaser if it wants to review the details of such financing (such additional notice, a “Subsequent Financing Notice”).
Upon the request of a Purchaser within two (2) Trading Days after the Pre-Notice, and only upon a request by such Purchaser, for
a Subsequent Financing Notice, the Company shall promptly, but no later than one (1) Trading Day after such request, deliver a
Subsequent Financing Notice to such Purchaser. The Subsequent Financing Notice shall describe in reasonable detail the proposed
terms of such Subsequent Financing, the amount of proceeds intended to be raised thereunder and the Person or Persons through or
with whom such Subsequent Financing is proposed to be effected and shall include a term sheet or similar document relating thereto
as an attachment.

 

 

    	27

    	 

    

 

(c)               
Any Purchaser desiring to participate in such Subsequent Financing must provide written notice to the Company no later than
two (2) Trading Days after delivery of such Subsequent Financing Notice that such Purchaser is willing to participate in the Subsequent
Financing, the amount of such Purchaser’s participation, and representing and warranting that such Purchaser has such funds
ready, willing, and available for investment on the terms set forth in the Subsequent Financing Notice.

 

(d)              
If notifications by the Purchasers of their willingness to participate in the Subsequent Financing (or to cause their designees
to participate) is, in the aggregate, less than the total amount of the Subsequent Financing, then the Company may effect the remaining
portion of such Subsequent Financing on the terms and with the Persons set forth in the Subsequent Financing Notice.

 

(e)   
If the Company receives responses to a Subsequent Financing Notice from Purchasers seeking to purchase more than the aggregate
amount of the Participation Maximum, each such Purchaser shall have the right to purchase its Pro Rata Portion (as defined below)
of the Participation Maximum.  “Pro Rata Portion” means the ratio of (x) the Subscription Amount of Securities
purchased by a Purchaser participating under this Section 4.12 and (y) the sum of the aggregate Subscription Amounts of Securities
purchased by all Purchasers participating under this Section 4.12.

 

(f)               
The Company must provide the Purchasers with a second Subsequent Financing Notice, and the Purchasers will again have the
right of participation set forth above in this Section 4.12, if the Subsequent Financing subject to the initial Subsequent Financing
Notice is not consummated for any reason on the terms set forth in such Subsequent Financing Notice within thirty (30) Trading
Days after the date of the initial Subsequent Financing Notice.

 

(g)              
The Company and each Purchaser agree that if any Purchaser elects to participate in the
Subsequent Financing, the transaction documents related to the Subsequent Financing shall not include any term or provision whereby
such Purchaser shall be required to agree to any restrictions on trading as to any of the Securities purchased hereunder or be
required to consent to any amendment to or termination of, or grant any waiver, release or the like under or in connection with,
this Agreement, without the prior written consent of such Purchaser.

 

(h)              
Notwithstanding anything to the contrary in this Section 4.12 and unless otherwise agreed to by such Purchaser, the Company
shall either confirm in writing to such Purchaser that the transaction with respect to the Subsequent Financing has been abandoned
or shall publicly disclose its intention to issue the securities in the Subsequent Financing, in either case in such a manner
such that such Purchaser will not be in possession of any material, non-public information, by the tenth (10th) Business Day following
delivery of the Subsequent Financing Notice. If by such tenth (10th) Business Day, no public disclosure regarding a transaction
with respect to the Subsequent Financing has been made, and no notice regarding the abandonment of such transaction has been received
by such Purchaser, such transaction shall be deemed to have been abandoned and such Purchaser shall not be deemed to be in possession
of any material, non-public information with respect to the Company or any of its Subsidiaries. 

 

    	28

    	 

    

 

 

(i)                
Notwithstanding the foregoing, this Section 4.12 shall not apply in respect of an Exempt Issuance.

 

4.13         
Equal Treatment of Purchasers. No consideration (including any modification of any Transaction Document) shall be
offered or paid to any Person to amend or consent to a waiver or modification of any provision of this Agreement unless the same
consideration is also offered to all of the parties to this Agreement. Further, the Company shall not make any payment of principal
or interest on the Notes in amounts which are disproportionate to the respective principal amounts outstanding on the Notes at
any applicable time. For clarification purposes, this provision constitutes a separate right granted to each Purchaser by the Company
and negotiated separately by each Purchaser, and is intended for the Company to treat the Purchasers as a class and shall not in
any way be construed as the Purchasers acting in concert or as a group with respect to the purchase, disposition or voting of Securities
or otherwise.

 

4.14         
Certain Transactions and Confidentiality. Each Purchaser, severally and not jointly with the other Purchasers, covenants
that neither it, nor any Affiliate acting on its behalf or pursuant to any understanding with it will (i) execute any Short Sales,
of any of the Company’s securities during the period commencing with the execution of this Agreement and ending at such time
that the transactions contemplated by this Agreement are first publicly announced pursuant to the initial press release as described
in Section 4.6 and (ii) execute any Short Sales of the Common Stock from the date hereof until the earlier of (x) the 12 month
anniversary of the date hereof and (y) the date that the Notes are no longer outstanding (provided that this provision shall not
prohibit any sales made where a corresponding Notice of Conversion is tendered to the Company and the shares received upon such
conversion are used to close out such sale) (a “Prohibited Short Sale”).  Each Purchaser, severally and
not jointly with the other Purchasers, covenants that until such time as the transactions contemplated by this Agreement are publicly
disclosed by the Company pursuant to the initial press release as described in Section 4.6, such Purchaser will maintain the confidentiality
of the existence and terms of this transaction and the information included in the Transaction Documents and the Disclosure Schedules.
Notwithstanding the foregoing, and notwithstanding anything contained in this Agreement to the contrary, the Company expressly
acknowledges and agrees that (i) no Purchaser makes any representation, warranty or covenant hereby that it will not engage in
effecting transactions in any securities of the Company after the time that the transactions contemplated by this Agreement are
first publicly announced pursuant to the initial press release as described in Section 4.6, (ii) except for a Prohibited Short
Sale, no Purchaser shall be restricted or prohibited from effecting any transactions in any securities of the Company in accordance
with applicable securities laws from and after the time that the transactions contemplated by this Agreement are first publicly
announced pursuant to the initial press release as described in Section 4.6 and (iii) no Purchaser shall have any duty of confidentiality
to the Company or its Subsidiaries after the issuance of the initial press release as described in Section 4.6.  Notwithstanding
the foregoing, in the case of a Purchaser that is a multi-managed investment vehicle whereby separate portfolio managers manage
separate portions of such Purchaser’s assets and the portfolio managers have no direct knowledge of the investment decisions
made by the portfolio managers managing other portions of such Purchaser’s assets, the covenant set forth above shall only
apply with respect to the portion of assets managed by the portfolio manager that made the investment decision to purchase the
Securities covered by this Agreement.

 

    	29

    	 

    

 

 

4.15         
Form D; Blue Sky Filings. The Company agrees to timely file a Form D with respect to the Securities as required under
Regulation D and to provide a copy thereof, promptly upon request of any Purchaser. The Company shall take such action as the Company
shall reasonably determine is necessary in order to obtain an exemption for, or to qualify the Securities for, sale to the Purchasers
at the Closing under applicable securities or “Blue Sky” laws of the states of the United States, and shall provide
evidence of such actions promptly upon request of any Purchaser.

 

ARTICLE V. 

MISCELLANEOUS

 

5.1             
Termination.  This Agreement may be terminated by any Purchaser, as to such Purchaser’s obligations hereunder
only and without any effect whatsoever on the obligations between the Company and the other Purchasers, by written notice to the
other parties, if the Closing has not been consummated on or before              ;
provided, however, that such termination will not affect the right of any party to sue for any breach by any other
party (or parties).

 

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

 

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

 

5.4             
Notices. Any and all notices or other communications or deliveries required or permitted to be provided hereunder
shall be in writing and shall be deemed given and effective on the earliest of: (a) the date of transmission, if such notice or
communication is delivered via facsimile at the facsimile number set forth on the signature pages attached hereto at or prior to
5:30 p.m. (New York City time) on a Trading Day, (b) the next Trading Day after the date of transmission, if such notice or communication
is delivered via facsimile at the facsimile number set forth on the signature pages attached hereto on a day that is not a Trading
Day or later than 5:30 p.m. (New York City time) on any Trading Day, (c) the second (2nd) Trading Day following the
date of mailing, if sent by U.S. nationally recognized overnight courier service or (d) upon actual receipt by the party to whom
such notice is required to be given. The address for such notices and communications shall be as set forth on the signature pages
attached hereto.

 

    	30

    	 

    

 

 

5.5             
Amendments; Waivers. No provision of this Agreement may be waived, modified, supplemented or amended except in a
written instrument signed, in the case of an amendment, by the Company and the Purchasers holding at least 67% in interest of the
Securities then outstanding or, in the case of a waiver, by the party against whom enforcement of any such waived provision is
sought. No waiver of any default with respect to any provision, condition or requirement of this Agreement shall be deemed to be
a continuing waiver in the future or a waiver of any subsequent default or a waiver of any other provision, condition or requirement
hereof, nor shall any delay or omission of any party to exercise any right hereunder in any manner impair the exercise of any such
right.

 

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

 

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

 

5.8             
No Third-Party Beneficiaries. This Agreement is intended for the benefit of the parties hereto and their respective
successors and permitted assigns and is not for the benefit of, nor may any provision hereof be enforced by, any other Person,
except as otherwise set forth in Section 4.10.

 

5.9             
Governing Law. All questions concerning the construction, validity, enforcement and interpretation of the Transaction
Documents shall be governed by and construed and enforced in accordance with the internal laws of the State of New York, without
regard to the principles of conflicts of law thereof. Each party agrees that all legal proceedings concerning the interpretations,
enforcement and defense of the transactions contemplated by this Agreement and any other Transaction Documents (whether brought
against a party hereto or its respective affiliates, directors, officers, shareholders, partners, members, employees or agents)
shall be commenced exclusively in the state and federal courts sitting in the City of New York. Each party hereby irrevocably submits
to the exclusive jurisdiction of the state and federal courts sitting in the City of New York, Borough of Manhattan for the adjudication
of any dispute hereunder or in connection herewith or with any transaction contemplated hereby or discussed herein (including with
respect to the enforcement of any of the Transaction Documents), and hereby irrevocably waives, and agrees not to assert in any
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 improper or is an inconvenient venue for such proceeding. Each party hereby irrevocably waives personal
service of process and consents to process being served in any such suit, action or proceeding by mailing a copy thereof via registered
or certified mail or overnight delivery (with evidence of delivery) to such party at the address in effect for notices to it under
this Agreement and agrees that such service shall constitute good and sufficient service of process and notice thereof. Nothing
contained herein shall be deemed to limit in any way any right to serve process in any other manner permitted by law. If either
party shall commence an action, suit or proceeding to enforce any provisions of the Transaction Documents, then, in addition to
the obligations of the Company under Section 4.10, the prevailing party in such action, suit or proceeding shall be reimbursed
by the other party for its reasonable attorneys’ fees and other costs and expenses incurred with the investigation, preparation
and prosecution of such action or proceeding.

 

    	31

    	 

    

 

 

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

 

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

 

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

 

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

 

    	32

    	 

    

 

 

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

 

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

 

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

 

5.17         
Usury. To the extent it may lawfully do so, the Company hereby agrees not to insist upon or plead or in any manner
whatsoever claim, and will resist any and all efforts to be compelled to take the benefit or advantage of, usury laws wherever
enacted, now or at any time hereafter in force, in connection with any claim, action or proceeding that may be brought by any Purchaser
in order to enforce any right or remedy under any Transaction Document. Notwithstanding any provision to the contrary contained
in any Transaction Document, it is expressly agreed and provided that the total liability of the Company under the Transaction
Documents for payments in the nature of interest shall not exceed the maximum lawful rate authorized under applicable law (the
“Maximum Rate”), and, without limiting the foregoing, in no event shall any rate of interest or default interest,
or both of them, when aggregated with any other sums in the nature of interest that the Company may be obligated to pay under the
Transaction Documents exceed such Maximum Rate. It is agreed that if the maximum contract rate of interest allowed by law and applicable
to the Transaction Documents is increased or decreased by statute or any official governmental action subsequent to the date hereof,
the new maximum contract rate of interest allowed by law will be the Maximum Rate applicable to the Transaction Documents from
the effective date thereof forward, unless such application is precluded by applicable law. If under any circumstances whatsoever,
interest in excess of the Maximum Rate is paid by the Company to any Purchaser with respect to indebtedness evidenced by the Transaction
Documents, such excess shall be applied by such Purchaser to the unpaid principal balance of any such indebtedness or be refunded
to the Company, the manner of handling such excess to be at such Purchaser’s election.

 

    	33

    	 

    

 

 

5.18         
Independent Nature of Purchasers’ Obligations and Rights. The obligations of each Purchaser under any Transaction
Document are several and not joint with the obligations of any other Purchaser, and no Purchaser shall be responsible in any way
for the performance or non-performance of the obligations of any other Purchaser under any Transaction Document. Nothing contained
herein or in any other Transaction Document, and no action taken by any Purchaser pursuant hereto or thereto, shall be deemed to
constitute the Purchasers as a partnership, an association, a joint venture or any other kind of entity, or create a presumption
that the Purchasers are in any way acting in concert or as a group with respect to such obligations or the transactions contemplated
by the Transaction Documents. Each Purchaser shall be entitled to independently protect and enforce its rights, including, without
limitation, the rights arising out of this Agreement or out of the other Transaction Documents, and it shall not be necessary for
any other Purchaser to be joined as an additional party in any proceeding for such purpose. Each Purchaser has been represented
by its own separate legal counsel in its review and negotiation of the Transaction Documents. For reasons of administrative convenience
only, each Purchaser and its respective counsel have chosen to communicate with the Company through Robinson Brog. The Company
has elected to provide all Purchasers with the same terms and Transaction Documents for the convenience of the Company and not
because it was required or requested to do so by any of the Purchasers.

 

5.19         
Liquidated Damages. The Company’s obligations to pay any partial liquidated damages or other amounts owing
under the Transaction Documents is a continuing obligation of the Company and shall not terminate until all unpaid partial liquidated
damages and other amounts have been paid notwithstanding the fact that the instrument or security pursuant to which such partial
liquidated damages or other amounts are due and payable shall have been canceled.

 

5.20         
Saturdays, Sundays, Holidays, etc.If the last or appointed day for the taking of any action or the expiration
of any right required or granted herein shall not be a Business Day, then such action may be taken or such right may be exercised
on the next succeeding Business Day.

 

5.21         
Construction. The parties agree that each of them and/or their respective counsel have reviewed and had an opportunity
to revise the Transaction Documents and, therefore, the normal rule of construction to the effect that any ambiguities are to be
resolved against the drafting party shall not be employed in the interpretation of the Transaction Documents or any amendments
thereto. In addition, each and every reference to share prices and shares of Common Stock in any Transaction Document shall be
subject to adjustment for reverse and forward stock splits, stock dividends, stock combinations and other similar transactions
of the Common Stock that occur after the date of this Agreement.

 

5.22         
WAIVER OF JURY TRIAL. IN ANY ACTION, SUIT, OR PROCEEDING IN ANY JURISDICTION BROUGHT BY ANY PARTY AGAINST ANY
OTHER PARTY, THE PARTIES EACH KNOWINGLY AND INTENTIONALLY, TO THE GREATEST EXTENT PERMITTED BY APPLICABLE LAW, HEREBY ABSOLUTELY,
UNCONDITIONALLY, IRREVOCABLY AND EXPRESSLY WAIVES FOREVER TRIAL BY JURY. 

 

 

 

(Signature Pages Follow)

 

 

    	34

    	 

    

 

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

 

	
        ELECTRONIC CIGARETTES

        INTERNATIONAL GROUP, LTD.

         
	
        Address for Notice:

         

	
        By: __________________

        Name: Brent David Willis

        Title: Chief Executive Officer

         

         
	Fax:

 

 

 

 

 

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK

SIGNATURE PAGE FOR PURCHASER FOLLOWS]

 

    	35

    	 

    

  

 

[PURCHASER
SIGNATURE PAGES TO SECURITIES PURCHASE AGREEMENT]

 

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

 

Name of Purchaser: ________________________________________________________

 

Signature of Authorized Signatory of
Purchaser: __________________________________

 

Name of Authorized Signatory: ____________________________________________________

 

Title of Authorized Signatory: _____________________________________________________

 

Email Address of Authorized Signatory:
_____________________________________________

 

Facsimile Number of Authorized Signatory: __________________________________________

 

Address for Notice to Purchaser:

 

 

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

 

 

First Closing Subscription Amount: $

 

Second Closing Subscription Amount: $

 

EIN Number: _______________________

 

[SIGNATURE PAGES CONTINUE]

 

 

    	36

    	 

    

 

Annex A

 

CLOSING STATEMENT

 

Pursuant to the attached Securities Purchase
Agreement, dated as of the date hereto, the purchasers shall purchase Notes from Electronic Cigarettes International Group, Ltd.
(the “Company”). All funds will be wired into an account maintained by the Company. All funds will be disbursed
in accordance with this Closing Statement.

 

Disbursement
Date:

 

 

	
        I. PURCHASE PRICE

         
	 
	 	Gross Proceeds to be Received 	$
	 	 
	
        II.DISBURSEMENTS

         
	 
	 	 	$
	 	 	$
	 	 	$
	 	 
	Total Amount Disbursed:	$	 
	 	 
	 	 
	
        WIRE INSTRUCTIONS:

         

         
	 
	 	 
	
        To: _____________________________________

         

         

        Duly executed this ___ day of         :

         

        Electronic Cigarettes International Group,
        Ltd.

         

         

        By: ___________________

        Name:

        Title:

         
	 

 

37EXHIBIT 10.1

 

 LICENSE AGREEMENT

 

This License Agreement
is entered into as of this 10th day of June, 2014 (the “Effective Date”), by and between Bar Ilan Research
and Development Company Ltd., a company formed under the laws of Israel, having a place of business at Bar Ilan University, Ramat
Gan, Israel (“BIRAD”) and T.A.B. Anti Bacterial Textiles Ltd., a company formed under the laws of Israel, having a
place of business at Ga'aton avenue 19, Nahariya, Israel (“Licensee”).

 

WHEREAS, BIRAD
is the technology commercialization subsidiary of Bar Ilan University (“BIU”);

 

WHEREAS, Professor
Aharon Gedanken of BIU and members of his research team at BIU have developed certain technology relating to sonochemical coating
of textiles with metal oxide nanoparticles, as disclosed in the Patent Rights (defined below);

 

WHEREAS, BIRAD
desires to have products based on the Patent Rights and the Technology Transfer Materials (as defined below) developed and commercialized
to benefit the public;

 

WHEREAS, Licensee
wishes to obtain a field limited license under the Patent Rights and Technology Transfer Materials in order to develop and commercialize
certain products based thereon; and

 

WHEREAS, Licensee
has represented to BIRAD, in order to induce BIRAD to enter into this Agreement, that Licensee shall commit itself to diligent
efforts to develop and commercialize such products.

 

NOW, THEREFORE,
the parties hereto, intending to be legally bound, hereby agree as follows:

 

	1.	Definitions.  

 

Whenever used in this
Agreement with an initial capital letter, the terms defined in this Article 1, whether used in the singular or the plural, shall
have the meanings specified below.

 

1.1.          “Affiliate”
means, with respect to an entity, any person, organization or entity controlling, controlled by or under common control with, such
party. For purposes of this definition only, “control” of another person, organization or entity shall mean the possession,
directly or indirectly, of the power to direct or cause the direction of the activities, management or policies of such person,
organization or entity, whether through the ownership of voting securities, by contract or otherwise. Without limiting the foregoing,
control shall be presumed to exist when a person, organization or entity (a) owns or directly controls fifty percent (50%) or more
of the outstanding voting stock or other ownership interest of the other organization or entity or (b) possesses, directly or indirectly,
the power to elect or appoint fifty percent (50%) or more of the members of the governing body of the organization or other entity.
The parties acknowledge that in the case of entities organized under the laws of certain countries, the maximum percentage ownership
permitted by law for a foreign investor may be less than fifty percent (50%), and that in such cases such lower percentage shall
be substituted in the preceding sentence.

 

    	1

    	 

    

  

1.2.          “Calendar
Quarter” means each of the periods of three (3) consecutive calendar months ending on March 31, June 30, September 30
and December 31, for so long as this Agreement is in effect.

 

1.3.          “Covered
Textile” means any non-disposable textile (a) the making, using or selling of which falls within the scope of a Valid
Claim (b) that is coated with nanoparticles through the practice of a License Method and/or (c) is developed or made through the
use of Technology Transfer Material.  

 

1.4.          “Development
Milestones” means the development and commercialization milestones set forth in Exhibit A hereto.

 

1.5.          “First
Commercial Sale” means the date of the first sale by
Licensee or its Affiliate, for cash in an arm’s length transaction, of a Licensed Product to an unaffiliated third party
for end use of such Licensed Product following (a) the commencement of marketing efforts by or on behalf of Licensee or its Affiliates
with respect to Licensed Products and (b) such time as Licensee and its Affiliates have generated Five Hundred Thousand US Dollars
($500,000) in cumulative worldwide Net Sales. For clarity, sales or other distribution for (i) use in testing or (ii) provision
of samples for test marketing or similar purposes shall not be deemed “First Commercial Sale”. 

 

1.6.          “Licensed
Method” means any method claimed or disclosed in the Patent Rights.

 

1.7.          “Licensed
Product” means any bed linen, drapery, upholstery, home textile and/or clothing that contains Covered Textile.

 

1.8.          “Net
Sales” means the gross amount billed or invoiced by or on behalf of a Related Party on sales, leases or other transfers
of Licensed Products, less the following to the extent applicable on such sales, leases or other transfers, or and not previously
deducted from the gross invoice price: (a) customary trade, quantity or cash discounts to the extent actually allowed and taken;
(b) amounts actually repaid or credited by reason of rejection or return of any previously sold, leased or otherwise transferred
Licensed Products; (c) customer freight charges that are paid by or on behalf of the Related Party; (d) to the extent separately
stated on purchase orders, invoices or other documents of sale, any sales, value added or similar taxes, custom duties or other
similar governmental charges levied directly on the production, sale, transportation, delivery or use of a Licensed Product that
are paid by or on behalf of the Related Party, but not including any tax levied with respect to income; provided that:

 

1.8.1.          in
any transfers, or provision, of Licensed Products between a Related Party and another Related Party not for the purpose of resale
by such other Related Party, Net Sales shall be equal to the fair market value of the Licensed Products so transferred or provided,
assuming an arm’s length transaction made in the ordinary course of business, and

 

1.8.2.          in
the event that a Related Party receives non-cash consideration for any Licensed Products or in the case of transactions not at
arm’s length with a non-Affiliate of the Related Party, Net Sales shall be calculated based on the fair market value of such
consideration or transaction, assuming an arm’s length transaction made in the ordinary course of business.

 

    	2

    	 

    

 

Sales of Licensed
Products by a Related Party to another Related Party for resale by such Related Party shall not be deemed Net Sales. Instead, Net
Sales shall be determined based on the gross amount billed or invoiced by such Related Party on resale of such Licensed Products
to a third party purchaser.

 

1.9.          
“Patent Rights” means, in each case to the extent owned and controlled by BIU: (a) the patent applications listed
in Exhibit B; (b) any patent or patent application that claims priority to and is a divisional, continuation, reissue, renewal,
reexamination, substitution or extension of any patent application identified in (a); (c) any patents issuing on any patent application
identified in (a) or (b), including any reissues, renewals, reexaminations, substitutions or extensions thereof; (d) any claim
of a continuation-in-part application or patent (including any reissues, renewals, reexaminations, substitutions or extensions
thereof) that is entitled to the priority date of, and is directed specifically to subject matter specifically described in, at
least one of the patents or patent applications identified in (a), (b) or (c); (e) any foreign counterpart (including PCTs) of
any patent or patent application identified in (a), (b) or (c) or of the claims identified in (d); and (f) any supplementary protection
certificates, pediatric exclusivity periods, any other patent term extensions and exclusivity periods and the like of any patents
and patent applications identified in (a) through (e);

 

1.10.         “Related
Party” means License and any Affiliate of Licensee.

 

1.11.         “Technology
Transfer Material” means the protocols, data and other results listed in Exhibit D hereto.

 

1.12.         “Territory”
means Europe, Asia, South America and Australia.

 

1.13.         “Valid
Claim” means: (a) a claim of an issued and unexpired patent within the Patent Rights that has not been (i) held permanently
revoked, unenforceable, unpatentable or invalid by a decision of a court or governmental body of competent jurisdiction, unappealable
or unappealed within the time allowed for appeal, (ii) rendered unenforceable through disclaimer or otherwise, (iii) abandoned
or (iv) permanently lost through an interference or opposition proceeding without any right of appeal or review; or (b) a pending
claim of a pending patent application within the Patent Rights that (i) has been asserted and continues to be prosecuted in good
faith and (ii) has not been abandoned or finally rejected without the possibility of appeal or refilling.

 

	2.	License.

 

	 	2.1.	License Grants. 

 

2.1.1.          Subject
to the terms and conditions set forth in this Agreement, BIRAD hereby grants to Licensee an exclusive (except as set forth below),
worldwide, non-transferrable, royalty-bearing, license (without the right to sublicense) under BIU’s interest in the Patent
Rights for the sole purpose of developing, manufacturing, using, offering for sale and selling Licensed Products solely within
the Territory; provided that BIRAD reserve the right, for itself, BIU and other not-for-profit research organizations to practice
and use the Patent Rights within the scope of the license set forth above solely for research, teaching and other educational purposes.

 

2.1.2.          Subject
to the terms and conditions set forth in this Agreement, BIRAD hereby grants to Licensee an exclusive, worldwide, non-transferrable,
royalty-bearing, license (without the right to sublicense) under BIU’s interest in the Technology Transfer Material for the
sole purpose of practicing the Licensed Method solely for the purpose of developing, manufacturing, using, offering for sale and
selling Licensed Products solely within the Territory.

 

    	3

    	 

    

 

2.1.3.          For clarity, no license is granted with respect to any
activities outside the Territory and no license is granted with respect to Covered Textiles for any use other than in
Licensed Products. Licensee shall not, and shall ensure that its Affiliates, contractors and distributors shall not: (a)
make, use, market nor sell Licensed Products outside the Territory; and (b) use or incorporate Covered Textiles in any
product that is not a Licensed Product.

 

2.2.         No
Sublicense. For clarity, Licensee shall not be entitled to grant licenses under the rights granted under Section 2.1 without
the prior written consent of BIRAD, which may be granted or withheld by BIRAD in its sole discretion. Licensee understands that
any such consent, if granted, will be conditioned upon the parties agreeing to the terms of compensation to be paid to BIRAD in
connection with such sublicense and other provisions protecting BIRAD’s rights.

 

2.3.         Affiliates
and Contractors. The license granted to Licensee under Section 2.1 includes the right to have some or all of Licensee’s
rights under Section 2.1 exercised or performed by one or more of Licensee’s Affiliates and/or contractors on Licensee’s
behalf for Licensee’s benefit without such right being deemed a sublicense; provided, however, that:

 

2.3.1.          no
such Affiliate or contractor shall be entitled to grant, directly or indirectly, to any third party any right of whatever nature
under, or with respect to, or permitting any use or exploitation of, any of the Patent Rights or Technology Transfer Material,
including any right to develop, manufacture, market, sell or provide Licensed Products; and

 

2.3.2.          any
act or omission taken or made by an Affiliate or contractor of Licensee under this Agreement will be deemed an act or omission
by Licensee under this Agreement.

 

2.4           No
Other Grant of Rights. Except for the licenses expressly granted in this Agreement, nothing in this Agreement shall be construed
to confer any ownership interest, license or other rights upon Licensee by implication, estoppel or otherwise as to any technology,
intellectual property rights, products or materials of BIRAD, BIU or any other entity, regardless of whether such technology,
intellectual property rights, products or materials are dominant, subordinate or otherwise related to any Patent Rigths or Technology
Transfer Material.

 

	3.	Development
    and Commercialization.

 

3.1          Diligence.
Licensee, alone and/or through its Affiliates, shall use commercially reasonable efforts, including funding consistent therewith:
(a) to develop Licensed Products; (b) to introduce Licensed Products into the commercial market; and
(c) to market Licensed Products following such introduction into the market. In addition and without limiting the foregoing,
Licensee, by itself and/or through its Affiliates, shall achieve each of the Development Milestones within the time periods specified
in Exhibit A.

 

3.2          Reporting.
Within sixty (60) days after the end of each calendar year, Licensee shall furnish BIRAD with a written report summarizing its
and its Affiliates’ efforts during the prior year to develop and commercialize Licensed Products, including without limitation:
(a) research and development activities; (b) commercialization efforts; and (c) marketing efforts. Each report shall contain a
sufficient level of detail for BIRAD to assess whether Licensee is in compliance with its obligations under Section 3.1 and a discussion
of intended efforts for the then current year.

 

    	4

    	 

    

  

3.3           Failure
to Meet Development Milestone; Opportunity to Cure. If Licensee believes that it will not achieve
a Development Milestone, it may notify BIRAD in writing in advance of the relevant deadline. Licensee shall include with such notice
(a) a reasonable explanation of the reasons for such failure (and lack of finances shall not constitute reasonable basis for such
failure) (“Explanation”) and (b) a reasonable, detailed, written plan for promptly achieving a reasonable extended
and/or amended milestone (“Plan”). If Licensee so notifies BIRAD, but fails to provide BIRAD with both an Explanation
and Plan, then the provisions of Section 10.2.3.1 shall apply if Licensee in fact fails to meet the Development Milestone. If Licensee
so notifies BIRAD and provides BIRAD with an Explanation and Plan, both of which are acceptable to BIRAD in its reasonable discretion,
then Exhibit A shall be amended automatically to incorporate the extended and/or amended milestone set forth in the Plan. If Licensee
so notifies BIRAD and provides BIRAD with an Explanation and Plan, but the Explanation is not reasonable to BIRAD in its reasonable
discretion (e.g. Licensee asserts lack of finances or development preference for a non-Licensed Product), then the deadline for
the relevant milestone shall remain unchanged and the provisions of Section 10.2.3.1 shall apply if Licensee in fact fails to meet
such milestone. If Licensee so notifies BIRAD and provides BIRAD with an Explanation and Plan, but the Plan is not acceptable to
BIRAD in its reasonable discretion, then BIRAD shall explain to Licensee why the Plan is not acceptable and provide Licensee with
suggestions for an acceptable Plan. Licensee shall have one opportunity to provide BIRAD with a reasonable Plan within ninety (90)
days, during which time BIRAD agrees to work with Licensee in its effort to develop a reasonable Plan. If, within such ninety (90)
days, Licensee provides BIRAD with a reasonable Plan, then Exhibit A shall be amended automatically to incorporate the extended
and/or amended milestone set forth in the Plan. If, within such ninety (90) days, Licensee fails to provide a reasonable Plan,
then Licensee shall have an additional thirty (30) days or until the original deadline of the relevant Development Milestone, whichever
is later, to meet such milestone. Licensee’s failure to do so shall constitute a material breach of this Agreement and BIRAD
shall have the right to terminate this Agreement forthwith.

 

	4.	Consideration
    for Grant of License

 

4.1.          License
Issuance Fee. Within thirty (30) days of the execution of this Agreement, Licensee shall pay BIRAD a non-refundable license
issuance fee of Thirty Five Thousand US Dollars ($35,000).

 

4.2.          Annual
Fee. Licensee shall pay BIRAD annual license maintenance fee of Twenty Thousand US Dollars ($20,000) per year. The first such
annual fee will be due and payable on the first anniversary of the Effective Date and the others will be due on each anniversary
thereafter during the term of this Agreement. Each annual license maintenance fee shall be creditable against any royalty amounts
payable under Section 4.3 below with respect to Licensed Products sold in the same calendar year that such annual license maintenance
fee was due.

 

4.3.          Royalty
on Net Sales. 

 

4.3.1.          Royalty
Rate. Licensee shall pay BIRAD an amount equal to three percent (3%) of all Net Sales.

 

4.3.2.          Royalty
Term. The royalties set forth above will be due until the later of: (a) the expiration of the last to expire Patent Rights;
and (b) until fifteen (15) years have passed from the date of the First Commercial Sale. 

 

    	5

    	 

    

  

	5.	Reports;
    Payments; Records.

 

	 	5.1.	Reports
    and Payments.

 

5.1.1.      Reports.
Within thirty (30) days after the conclusion of each Calendar Quarter commencing with the first
Calendar Quarter in which Net Sales are generated, Licensee shall deliver to BIRAD a report containing the following information
(in each case, with a Licensed Product-by-Licensed Product breakdown): 

 

5.1.1.1.    if
there was a First Commercial Sale of a Licensed Product in such Calendar Quarter, the name of the country and the date of the First
Commercial Sale;

 

5.1.1.2.
the number of units of Licensed Products sold by Related Parties for the applicable Calendar Quarter;

 

5.1.1.3 the
gross amount billed or invoiced for Licensed Products sold, leased, otherwise transferred or provided by Related Parties during
the applicable Calendar Quarter; 

 

5.1.1.4     a
calculation of Net Sales for the applicable Calendar Quarter, including an itemized listing of applicable deductions; and

 

5.1.1.5     a
calculation of amount payable to BIRAD for the applicable Calendar Quarter.

 

Each such report
shall be certified on behalf of Licensee by a senior officer of Licensee as true, correct and complete in all material respects.
If no amounts are due to BIRAD for a particular Calendar Quarter, the report shall so state.

 

5.1.2.      Payment.
Within thirty (30) days after the end of each Calendar Quarter, Licensee shall pay BIRAD all
amounts due for the applicable Calendar Quarter.

 

5.2.         Payment
Currency. All payments due under this Agreement will be paid in New Israeli Shekels. Conversion
of foreign currency to New Israeli Shekels will be made at the conversion rate published by the Bank of Israel for the last working
day of the applicable Calendar Quarter. Such payments will be without deduction of exchange, collection or other charges.

 

5.3.         Records.
Licensee shall maintain, and shall cause its Affiliates to maintain, complete and accurate records
of Licensed Products that are made, used, sold, leased, otherwise transferred or provided under this Agreement and any amounts
payable to BIRAD in relation to such Licensed Products, which records shall contain sufficient information to permit BIRAD to confirm
the accuracy of any reports or notifications delivered to BIRAD under Section 5.1. Licensee and the relevant Affiliates shall retain
such records relating to a given Calendar Quarter for at least five (5) years after the conclusion of that Calendar Quarter, during
which time BIRAD shall have the right, at its expense, to cause an independent, certified public accountant (or, in the event of
a non-financial audit, other appropriate auditor) to inspect such records during normal business hours for the purposes of verifying
the accuracy of any reports and payments delivered under this Agreement and Licensee’s compliance with the terms hereof.
Such accountant or other auditor, as applicable, shall not disclose to BIRAD any information other than information relating to
the accuracy of reports and payments delivered under this Agreement. The parties shall reconcile any underpayment or overpayment
within thirty (30) days after the accountant delivers the results of the audit. In the event that any audit performed under this
Section 5.2 reveals an underpayment in excess of five percent (5%) in any calendar year, the audited entity shall bear the full
cost of such audit. BIRAD may exercise its rights under this Section 5.2 only once every year per audited entity and only with
reasonable prior notice to the audited entity.

 

    	6

    	 

    

 

5.4.         Late
Payments. Any payments by Licensee that are not paid on or before the date such payments are
due under this Agreement shall bear interest at the lower of (a) one and one half percent (1.5%) per month and (b) the maximum
rate allowed by law. Interest shall accrue beginning on the first day following the due date for payment and shall be compounded
quarterly. Payment of such interest by Licensee shall not limit, in any way, BIRAD’s right to exercise any other remedies
BIRAD may have as a consequence of the lateness of any payment.

 

5.5.         Payment
Method. Each payment due to BIRAD under this Agreement shall be paid by check or wire transfer
of funds to BIRAD’s account in accordance with written instructions provided by BIRAD. If made by wire transfer, such payments
shall be marked so as to refer to this Agreement.

 

5.6.         VAT;
Withholding and Similar Taxes. All amounts to be paid to BIRAD pursuant to this Agreement are
exclusive of Value Added Tax. Licensee shall add value added tax, to the extent required by applicable law, to all such amounts.
All amounts to be paid to BIRAD pursuant to this Agreement shall be without deduction of exchange, collection, or other charges,
and, specifically, without deduction of withholding or similar taxes or other government imposed fees or taxes. Notwithstanding
the foregoing, if Licensee is required to withhold any amounts payable hereunder in accordance with the requirement of Israeli
incom tax law and BIRAD is unable to present Licensee with proof of exemption from such withholding, such amount will be deducted
from the payment to be made by Licensee and remitted to the Israeli income tax authority for the benefit of BIRAD. Licensee will
withhold only such amounts as are required to be withheld by Israeli income tax law. Licensee shall submit to BIRAD originals of
the remittance voucher and the official receipt evidencing the payment of the corresponding taxes with the applicable royalty report.

 

	6.	Patent
    Filing, Prosecution and Maintenance.

 

6.1.         Control.
BIRAD shall be responsible for the preparation, filing, prosecution, protection and maintenance of all Patent Rights, using independent
patent counsel reasonably acceptable to Licensee. BIRAD shall: (a) instruct such patent counsel to furnish the Licensee with copies
of all correspondence relating to the Patent Rights from the United States Patent and Trademark Office (USPTO) and any other patent
office, as well as copies of all proposed responses to such correspondence in time for Licensee to review and comment on each such
response; (b) give Licensee an opportunity to review the text of each patent application before filing; (c) consult with Licensee
with respect thereto; (d) supply Licensee with a copy of the application as filed, together with notice of its filing date and
serial number; and (e) keep Licensee advised of the status of actual and prospective patent filings. BIRAD shall give Licensee
the opportunity to provide comments on and make requests of BIRAD concerning the preparation, filing, prosecution, protection and
maintenance of the Patent Rights, and shall consider such comments and requests in good faith; however, final decision-making authority
shall vest in BIRAD. 

 

		6.2.	Expenses.

 

6.2.1           Subject
to Section 6.3 below, Licensee shall reimburse BIRAD for all documented, out-of-pocket expenses incurred by BIRAD pursuant to this
Section 6 within thirty (30) days after the date of each invoice from BIRAD for such expenses. In addition, Licensee shall reimburse
BIRAD for all documented, out-of-pocket expenses incurred by BIRAD prior to the execution of this Agreement with respect to the
preparation, filing, prosecution, protection and maintenance of Patent Rights within thirty (30) days after the date of each invoice
from BIRAD for such expenses.

 

    	7

    	 

    

 

6.2.2.          If
BIRAD enters into a license with a third party with respect to any of the Patent Rights, BIRAD will proportionately reduce Licensee’s
share of such expenses with respect to the Patent Rights going forward. In addition, BIRAD shall use commercially reasonable efforts
to cause each new licensee of the Patent Rights to agree to pay a pro-rata portion of expenses already reimbursed by Licensee in
connection with the Patent Rights, taking into consideration the scope and type (e.g., field, exclusive vs. non-exclusive, etc.)
of such new license. BIRAD will reimburse Licensee for a pro rata share of such expenses already paid by Licensee.

 

6.3.         Abandonment.
If Licensee decides that it does not wish to pay for the preparation, filing, prosecution, protection or maintenance
of any Patent Rights in a particular country (“Abandoned Patent Rights”), Licensee shall provide BIRAD with prompt
written notice of such election. Upon receipt of such notice by BIRAD, Licensee shall be released from its obligation to reimburse
BIRAD for the expenses incurred thereafter as to such Abandoned Patent Rights; provided, however, that expenses authorized prior
to the receipt by BIRAD of such notice shall be deemed incurred prior to the notice. In the event of Licensee’s abandonment
of any Patent Rights, any license granted by BIRAD to Licensee hereunder with respect to such Abandoned Patent Rights will terminate,
and Licensee will have no rights whatsoever to exploit such Abandoned Patent Rights. BIRAD will then be free, without further notice
or obligation to Licensee, to grant rights in and to such Abandoned Patent Rights to third parties.

 

6.4          Marking.
Licensee shall, and shall cause its Affiliates to, mark all License Products sold or otherwise
disposed of in such a manner as to conform with the patent laws and practice of the country to which such products are shipped
or in which such products are sold for purposes of ensuring maximum enforceability
of Patent Rights in such country.

 

	7.	Enforcement
    of Patent Rights. 

 

7.1          Notice.
In the event either party becomes aware of any possible or actual infringement of any Patent Rights with respect to Licensed Products
(an “Infringement”), that party shall promptly notify the other party and provide it with details regarding such Infringement.

 

    	8

    	 

    

  

7.2          Suit
by Licensee. Licensee shall have the first right, but not the obligation, to take action in the
prosecution, prevention, or termination of any Infringement. Before Licensee commences an action with
respect to any Infringement, Licensee shall consider in good faith the views of BIRAD and potential effects on the public interest
in making its decision whether to sue. Should Licensee elect to bring suit against an Infringer, Licensee
shall keep BIRAD reasonably informed of the progress of the action and shall give BIRAD a reasonable opportunity in advance to
consult with Licensee and offer its views about major decisions affecting the litigation. Licensee shall give careful consideration
to those views, but shall have the right to control the action; provided, however, that if Licensee fails to defend in good faith
the validity and/or enforceability of the Patent Rights in the action or, or if Licensee’s license to the Patent Rights in
the suit terminates, BIRAD may elect to take control of the action pursuant to Section 7.3. Should Licensee elect to bring
suit against an Infringer and BIRAD is joined as party plaintiff in any such suit, BIRAD shall have the right to approve the counsel
selected by Licensee to represent Licensee and BIRAD, such approval not to be unreasonably withheld. The expenses of such suit
or suits that Licensee elects to bring, including any expenses of BIRAD incurred in conjunction with the prosecution of such suits
or the settlement thereof, shall be paid for entirely by Licensee and Licensee shall hold BIRAD free, clear and harmless from and
against any and all costs of such litigation, including attorney’s fees. Licensee shall not compromise or settle such litigation
without the prior written consent of BIRAD, which consent shall not be unreasonably withheld or delayed. In the event Licensee
exercises its right to sue pursuant to this Section 7.2, it shall first reimburse itself out of any sums recovered in such suit
or in settlement thereof for all costs and expenses of every kind and character, including reasonable attorney’s fees, necessarily
incurred in the prosecution of any such suit. If, after such reimbursement, any funds shall remain from said recovery, then BIRAD
shall receive an amount equal to twenty five percent (25%) of such funds and the remaining seventy-five percent (75%) of such funds
shall be retained by Licensee.

 

7.3          Suit
by BIRAD. If Licensee does not take action in the prosecution, prevention, or termination of
any Infringement pursuant to Section 7.2 above, and has not commenced negotiations with the infringer for the discontinuance of
said Infringement, within ninety (90) days after receipt of notice to Licensee by BIRAD of the existence of an Infringement, BIRAD
may elect to do so. Should BIRAD elect to bring suit against an infringer and Licensee is joined as party plaintiff in any such
suit, Licensee shall have the right to approve the counsel selected by BIRAD to represent BIRAD and Licensee, such approval not
to be unreasonably withheld. The expenses of such suit or suits that BIRAD elects to bring, including any expenses of Licensee
incurred in conjunction with the prosecution of such suits or the settlement thereof, shall be paid for entirely by BIRAD and BIRAD
shall hold Licensee free, clear and harmless from and against any and all costs of such litigation, including attorney’s
fees. BIRAD shall not compromise or settle such litigation without the prior written consent of Licensee, which consent shall not
be unreasonably withheld or delayed. In the event BIRAD exercises its right to sue pursuant to this Section 7.3, it shall first
reimburse itself out of any sums recovered in such suit or in settlement thereof for all costs and expenses of every kind and character,
including reasonable attorney’s fees, necessarily incurred in the prosecution of any such suit. If, after such reimbursement,
any funds shall remain from said recovery, then Licensee shall receive an amount equal to twenty-five percent (25%) of such funds
and the remaining seventy-five percent (75%) of such funds shall be retained by BIRAD.

 

7.4          Own
Counsel. Each party shall always have the right to be represented by counsel of its own selection
and at its own expense in any suit instituted under this Section 7 by the other party for Infringement.

 

7.5          Cooperation.
Each party agrees to cooperate fully in any action under this Section 7 that is controlled by the other party, provided that the
controlling party reimburses the cooperating party promptly for any costs and expenses incurred by the cooperating party in connection
with providing such assistance. 

 

7.6          Standing.
If a party lacks standing and the other party has standing to bring any such suit, action or proceeding, then such other party
shall do so at the request of and at the expense of the party that lacks standing. 

 

7.7          Declaratory
Judgment. If a declaratory judgment action is brought naming a Related Party as a defendant and
alleging invalidity or unenforceability of any claims within the Patent Rights, Licensee shall promptly notify BIRAD in writing
and BIRAD may elect, upon written notice to Licensee within thirty (30) days after BIRAD receives notice of the commencement of
such action, to take over the sole defense of the invalidity and/or unenforceability aspect of the action at its own expense.

 

    	9

    	 

    

 

	8.	Warranties;
    Limitation of Liability.

 

8.1.         Compliance
with Law. Licensee represents and warrants that it will comply, and will ensure that its Affiliates
comply, with all local, state, and international laws and regulations relating to the development, manufacture, use, sale and importation
of Licensed Products. Without limiting the foregoing, Licensee represents and warrants that it will comply, and will ensure that
its Affiliates comply, with all applicable export control laws and regulations.

 

	 	8.2.	Disclaimer
    of Other Warranties.

 

8.2.1           Nothing
contained herein shall be deemed to be a warranty by BIRAD that it can or will be able to obtain patents on patent applications
included in the Patent Rights, or that any of the Patent Rights will afford adequate or commercially worthwhile protection.

 

8.2.2.          BIRAD
AND BIU MAKE NO WARRANTIES WHATSOEVER AS TO THE COMMERCIAL OR SCIENTIFIC VALUE OF THE PATENT RIGHTS OR TECHNOLOGY TRANSFER MATERIALS.
BIRAD AND BIU MAKE NO REPRESENTATION THAT THE PRACTICE OF THE PATENT RIGHTS OR USE OF THE TECHNOLOGY TRANSFER MATERIALS OR THE
DEVELOPMENT, MANUFACTURE, USE, SALE OR IMPORTATION OF ANY LICENSED PRODUCT, OR ANY ELEMENT THEREOF, WILL NOT INFRINGE THE PATENT
OR PROPRIETARY RIGHTS OF ANY THIRD PARTY.

 

8.2.3           EXCEPT
AS OTHERWISE EXPRESSLY PROVIDED IN THIS AGREEMENT, NEITHER PARTY MAKES ANY WARRANTY WITH RESPECT TO ANY TECHNOLOGY, PATENTS, GOODS,
SERVICES, RIGHTS OR OTHER SUBJECT MATTER OF THIS AGREEMENT AND HEREBY DISCLAIMS WARRANTIES OF MERCHANTABILITY, FITNESS FOR A PARTICULAR
PURPOSE AND NONINFRINGEMENT WITH RESPECT TO ANY AND ALL OF THE FOREGOING.

 

	 	8.3	Limitation
    of Liability.  

 

8.3.1.          Except
with respect to matters for which Licensee is obligated to indemnify Indemnitees under Section 9, neither party will be liable
to the other with respect to any subject matter of this Agreement under any contract, negligence, strict liability or other legal
or equitable theory for (a) any indirect, incidental, consequential or punitive damages or lost profits or (b) cost of procurement
of substitute goods, technology or services.

 

8.3.2.          BIRAD’s
aggregate liability for all damages of any kind arising out of or relating to this Agreement or its subject matter shall not exceed
the amounts paid to BIRAD under this Agreement.

 

    	10

    	 

    

 

	9.	Indemnification.

 

9.1           Indemnity.
Licensee shall indemnify, defend and hold harmless BIRAD and BIU and their respective current
and former directors, governing board members, trustees, officers, faculty, professional staff, employees, students, and agents
and their respective successors, heirs and assigns (collectively, the “Indemnitees”) from and against any claim, liability,
cost, expense, damage, deficiency, loss or obligation or any kind or nature (including, without limitation, reasonable attorney’s
fees and other costs and expenses of litigation) (collectively, “Claims”), based upon, arising out of, or otherwise
relating to this Agreement, including without limitation any cause of action relating to product liability concerning any product,
process, or service made, used or sold pursuant to any right or license granted under this Agreement. 

 

9.2           Procedures.
If any Indemnitee receives notice of any Claim, such Indemnitee shall, as promptly as is reasonably possible, give Licensee notice
of such Claim; provided, however, that failure to give such notice promptly shall only relieve Licensee of any indemnification
obligation it may have hereunder to the extent such failure diminishes the ability of Licensee to respond to or to defend the Indemnitee
against such Claim. BIRAD and Licensee shall consult and cooperate with each other regarding the response to and the defense of
any such Claim and Licensee shall, upon its acknowledgment in writing of its obligation to indemnify the Indemnitee, be entitled
to and shall assume the defense or represent the interests of the Indemnitee in respect of such Claim, that shall include the right
to select and direct legal counsel and other consultants to appear in proceedings on behalf of the Indemnitee and to propose, accept
or reject offers of settlement, all at its sole cost; provided, however, that no such settlement shall be made without the written
consent of the Indemnitee, such consent not to be unreasonably withheld. Nothing herein shall prevent the Indemnitee from retaining
its own counsel and participating in its own defense at its own cost and expense.

 

9.3.          Insurance.
Beginning at the time any Licensed Product is being commercially distributed, sold or (in the case of services) provided by or
on behalf of Licensee, or an Affiliate of Licensee, Licensee shall, at its sole cost and expense, procure and maintain insurance
that is reasonably adequate to fulfill any potential obligation to the Indemnitees under this Section 9, taking into consideration,
among other things, the nature of the products commercialized. Without limiting the foregoing, beginning at the time any Licensed
Product is being sold, leased, otherwise transferred or provided, such insurance shall include commercial liability insurance in
amounts standard in the industry. Such insurance shall be obtained from a reputable insurance
company. BIRAD shall be added as co-insured parties under such insurance policy. Licensee hereby undertakes to comply punctually
with all obligations imposed upon it under such policy(ies), including without limitation the obligation to pay in full and punctually
all premiums and other payments due under such policy(ies). Licensee shall provide BIRAD, upon request, with written evidence of
such insurance. Licensee shall continue to maintain such insurance after the expiration or termination of this Agreement during
any period in which any Related Party continues to make, use, or sell Licensed Products, and thereafter for a period of seven (7)
years.

 

	10.	Term
    and Termination.

 

10.1.        Term.
The term of this Agreement shall commence on the Effective Date and, unless earlier terminated as provided in this Section 10,
shall continue in full force and effect until the last-to-expire period during
which Licensee is obligated to pay royalties to BIRAD under Section 4.3. Following the expiration of this Agreement pursuant to
this Section 10.1 (and provided the Agreement has not been earlier terminated pursuant to any of the provisions of Section 10.2,
in which case the provisions of Section 10.3 will apply), the licenses granted to Licensee under Section 2.1 with respect to the
Technology Transfer Material shall become fully-paid up and non-exclusive license.

 

    	11

    	 

    

  

	 	10.2.	Termination.

 

10.2.1.        Termination
Without Cause. Licensee may terminate this Agreement upon sixty (60) days prior written notice
to BIRAD. 

 

10.2.2.        Termination
for Patent Challenge. BIRAD may terminate this Agreement immediately upon written notice to Licensee
if Licensee commences an action in which it challenges the validity, enforceability or scope of any of the Patent Rights.

 

	 	10.2.3.	Termination
    for Default.  

 

10.2.3.1           In
the event that either party commits a material breach of its obligations under this Agreement and fails to cure that breach within
thirty (30) days after receiving written notice thereof, the other party may terminate this Agreement immediately upon written
notice to the party in breach.

 

10.2.3.2.          If
Licensee defaults in its obligations under Section 9.3 to procure and maintain insurance, then BIRAD may terminate this Agreement
immediately without notice or additional waiting period. 

 

10.2.3.3.          BIRAD
may terminate this Agreement in accordance with the provisions of Section 3.4.

 

10.2.4.          Bankruptcy.
BIRAD may terminate this Agreement upon notice to Licensee if Licensee becomes insolvent, is
adjudged bankrupt, applies for judicial or extra-judicial settlement with its creditors, makes an assignment for the benefit of
its creditors, voluntarily files for bankruptcy or has a receiver or trustee (or the like) in bankruptcy appointed by reason of
its insolvency, or in the event an involuntary bankruptcy action is filed against Licensee and not dismissed within ninety (90)
days, or if the other party becomes the subject of liquidation or dissolution proceedings or otherwise discontinues business.

 

	 	10.3.	Effect
    of Termination.  

 

10.3.1.          Termination
of Rights. Upon termination of this Agreement by either party pursuant to any of the provisions
of Section 10.2, the rights and licenses granted to Licensee under Section 2 shall terminate.

 

10.3.2.          Accruing
Obligations. Termination or expiration of this Agreement shall not relieve the parties of obligations
accruing prior to such termination or expiration, including obligations to pay amounts accruing hereunder up to the date of termination
or expiration. After the date of termination or expiration (except in the case of termination by BIRAD in accordance with any of
the provisions of Section 10.2.2 or 10.2.3), Licensee and its Affiliates (a) may sell Licensed Products then in stock and (b) may
complete the production of Licensed Products then in the process of production and sell the same; provided that, in the case of
both (a) and (b), Licensee shall pay the applicable royalties and payments to BIRAD in accordance with Section 4.3, provide reports
and audit rights to BIRAD pursuant to Section 5 and maintain insurance in accordance with the requirements of Section 9.3.

 

10.3.3.        Transfer
of IP. If Licensee terminates this Agreement pursuant to Section 10.2.1 or BIRAD terminates this Agreement pursuant to any
of the provisions of Section 10.2, Licensee shall promptly deliver and assign to BIRAD all intellectual property, inventions, conceptions,
compositions, materials, methods, processes, data, information, records, results, studies and analyses, discovered or acquired
by, or on behalf of Licensee and its Affiliates which relate directly to actual or potential Licensed Products.

 

    	12

    	 

    

 

10.4.          Survival.
The parties’ respective rights, obligations and duties under Sections 5.1 (with respect to sales made prior to termination
or in accordance with Section 10.3.2), 5.2, 5.3, 5.4, 5.5, 5.6, 8.1, 8.3, 9, 10.3, 11, 12.1 and 12.4 as well as any rights, obligations
and duties which by their nature extend beyond the expiration or termination of this Agreement, shall survive any expiration or
termination of this Agreement. 

 

	11.	Confidential
    Information

 

11.1         BIRAD
Confidential Information. Licensee agrees that, without the prior written consent of BIRAD for
a period of seven (7) years from date of disclosure, it will keep confidential, and not disclose or use BIRAD Confidential Information
(as defined below) other than for the purposes of this Agreement. Licensee shall treat such BIRAD Confidential Information with
the same degree of confidentiality as it keeps its own confidential information, but in all events no less than a reasonable degree
of confidentiality. Licensee may disclose BIRAD Confidential Information only to employees, consultants and contractors of Licensee
who have a “need to know” such information in order to enable Licensee to exercise its rights or fulfill its obligations
under this Agreement and are legally bound by agreements which impose confidentiality and non-use obligations comparable to those
set forth in this Agreement. For purposes of this Agreement, “BIRAD Confidential Information” means any unpublished
Patent Rights and any information within the Technology Transfer Material or that is disclosed to Licensee that is designated as
confidential or which otherwise should reasonably be construed under the circumstances as being confidential, except to the extent
such information: (i) was known to Licensee at the time it was disclosed, other than by previous disclosure by or on behalf of
BIRAD or BIU, as evidenced by Licensee’s written records at the time of disclosure; (ii) is at the time of disclosure or
later becomes publicly known under circumstances involving no breach of this Agreement; (iii) is lawfully and in good faith made
available to Licensee by a third party who is not subject to obligations of confidentiality to BIRAD nor BIU with respect to such
information; or (iv) is independently developed by Licensee without the use of or reference to BIRAD Confidential Information,
as demonstrated by documentary evidence.

 

11.2         Licensee
Confidential Information. BIRAD agrees that, without the prior written consent of Licensee for
a period of seven (7) years from date of disclosure, it will keep confidential, and not disclose or use Licensee Confidential Information
(as defined below) other than for the purposes of this Agreement. BIRAD shall treat such Licensee Confidential Information with
the same degree of confidentiality as it keeps its own confidential information, but in all events no less than a reasonable degree
of confidentiality. BIRAD may disclose Licensee Confidential Information only to employees and consultants of and BIU who have
a “need to know” such information in order to enable BIRAD to exercise its rights under this Agreement and are legally
bound by agreements which impose confidentiality and non-use obligations comparable to those set forth in this Agreement. For purposes
of this Agreement, “Licensee Confidential Information” means information contained in reports delivered by Licensee
to BIRAD pursuant to Section 3 or 5, except to the extent such information: (i) was known to BIRAD or BIU at the time it was disclosed,
other than by previous disclosure by or on behalf of Licensee, as evidenced by BIRAD’s or BIU’s written records at
the time of disclosure; (ii) is at the time of disclosure or later becomes publicly known under circumstances involving no breach
of this Agreement; (iii) is lawfully and in good faith made available to BIRAD or BIU by a third party who is not subject to obligations
of confidentiality to Licensee with respect to such information; or (iv) is independently developed by BIRAD or BIU without the
use of or reference to Licensee Confidential Information, as demonstrated by documentary evidence.

 

    	13

    	 

    

  

	12.	Miscellaneous.

 

12.1.          Use
of Name. Licensee shall not, and shall ensure that its Affiliates shall not, use the name or
insignia of BIU or BIRAD or the name of any of BIU’s or BIRAD’s officers, faculty, employees, other researchers or
students, or any adaptation of such names, in any advertising, promotional or sales literature, including without limitation any
press release or any document employed to obtain funds, without the prior written approval of BIRAD. 

 

12.2.          Entire
Agreement. This Agreement is the sole agreement with respect to the subject matter hereof and
except as expressly set forth herein, supersedes all other agreements and understandings between the parties with respect to the
same.

 

12.3.          Notices.
Unless otherwise specifically provided, all notices required or permitted by this Agreement shall be in writing and may be delivered
personally, or may be sent by facsimile, overnight delivery or certified mail, return receipt requested, to the following addresses,
unless the parties are subsequently notified of any change of address in accordance with this Section 12.3:

 

	   If to Licensee:	
         

        T.A.B. Anti Bacterial Textiles Ltd

        Ga'aton avenue 19,

        Nahariya, Israel

        Attn: Chief Executive Officer

	 	 
	  If to BIRAD:	
        Bar Ilan Research and Development Company Ltd.

        Bar Ilan University

        Ramat Gan, Israel

         

        Attn: Director of Business Development

 

Any notice shall be deemed
to have been received as follows: (a) by personal delivery, upon receipt; (b) by facsimile or overnight delivery, one business
day after transmission or dispatch; (c) by certified mail, as evidenced by the return receipt. If notice is sent by facsimile,
a confirming copy of the same shall be sent by mail to the same address.

 

12.4.          Governing
Law and Jurisdiction. This Agreement will be governed by, and construed in accordance with, the
laws Israel, without giving effect to any choice or conflict of law provision, except that questions affecting the construction
and effect of any patent shall be determined by the law of the country in which the patent shall have been granted. The parties
hereby agree that the competent court in Tel Aviv Israel shall have sole jurisdiction over any and all matters arising from this
Agreement, except that BIRAD may bring suit against Licensee in any other jurisdiction outside Israel in which Licensee has assets
or a place of business.

 

12.5.          Binding
Effect. This Agreement shall be binding upon and inure to the benefit of the parties and their
respective legal representatives, successors and permitted assigns.

 

    	14

    	 

    

 

12.6.          Headings.
Section and subsection headings are inserted for convenience of reference only and do not form a part of this Agreement.

 

12.7.          Counterparts.
The parties may execute this Agreement in two or more counterparts, each of which shall be deemed an original.

 

12.8.          Amendment;
Waiver. This Agreement may be amended, modified, superseded or canceled, and any of the terms
may be waived, only by a written instrument executed by each party or, in the case of waiver, by the party waiving compliance.
The delay or failure of either party at any time or times to require performance of any provisions hereof shall in no manner affect
the rights at a later time to enforce the same. No waiver by either party of any condition or of the breach of any term contained
in this Agreement, whether by conduct, or otherwise, in any one or more instances, shall be deemed to be, or considered as, a further
or continuing waiver of any such condition or of the breach of such term or any other term of this Agreement.

 

12.9.          No
Agency or Partnership. Nothing contained in this Agreement shall give either party the right
to bind the other, or be deemed to constitute either party as agent for or partner of the other or any third party.

 

12.10.         Assignment
and Successors. This Agreement may not be assigned by either party without the consent of the
other, which consent shall not be unreasonably withheld, except that each party may, without such consent, assign this Agreement
and the rights, obligations and interests of such party to any of its Affiliates, to any purchaser of all or substantially all
of its assets or research to which the subject matter of this Agreement relates, or to any successor corporation resulting from
any merger or consolidation of such party with or into such corporation; provided, in each case, that the assignee agrees in writing
to be bound by the terms of this Agreement. Any assignment purported or attempted to be made in violation of the terms of this
Section 12.10 shall be null and void and of no legal effect.

 

12.11.         Force
Majeure. Neither party will be responsible for delays resulting from causes beyond the reasonable
control of such party, including, without limitation, fire, explosion, flood, war, strike, or riot, provided that the nonperforming
party uses commercially reasonable efforts to avoid or remove such causes of nonperformance and continues performance under this
Agreement with reasonable dispatch whenever such causes are removed.

 

12.12.         Interpretation.
Each party hereto acknowledges and agrees that: (a) it and/or its counsel reviewed and negotiated
the terms and provisions of this Agreement and has contributed to its revision; (b) the rule of construction to the effect that
any ambiguities are resolved against the drafting party shall not be employed in the interpretation of this Agreement; and (c)
the terms and provisions of this Agreement shall be construed fairly as to both parties hereto and not in favor of or against either
party, regardless of which party was generally responsible for the preparation of this Agreement.

 

12.13.         Severability.
If any provision of this Agreement is or becomes invalid or is ruled invalid by any court of competent jurisdiction or is deemed
unenforceable, it is the intention of the parties that the remainder of this Agreement shall not be affected.

 

    	15

    	 

    

  

IN WITNESS WHEREOF, the parties
have caused this Agreement to be executed by their duly authorized representatives as of the date first written above.

  

	Bar Ilan Research and Development 	 	T.A.B. Anti Bacterial Textiles Ltd.
	Company Ltd.	 	 
	 	 	 
	By:  	/s/ Orli Tori	 	By: 	/s/ Joshua Herchcovici  Meir
Elishkov
	 	 	 
	Name:  	Orli Tori	 	Name: 	Joshua Herchcovici  Meir Elishkov 
	 	 	 
	Title: 	CEO	 	Title:	 

 

    	16

    	 

    

  

EXHIBIT A- DEVELOPMENT PLAN

 

1. Development of Roll To Roll machine of industrial scale

    This milestone will be completed within
(18) months of Effective Date.

 

2. Pilot production and troubleshooting

    This milestone will be completed within
(26) months of Effective Date.

 

3. First serial production & distributing to a selected
number of medical

    institutions for performance and assessment.

    This milestone will be completed within
(32) months of Effective Date.

 

4. Regulatory approval of the product

    This milestone will be completed within
(36) months of Effective Date.

 

5. Serial production on industrial scale

    This milestone will be completed within
(40) months of Effective Date.

 

    	17

    	 

    

 

EXHIBIT B- Patent Applications

 

Title: Sonochemical coating of textiles
with Metal Oxide Nanoparticles for Antimicrobial Fabrics

PCT no.: PCT/IL2009/000645

National Phase:

IL – appl. no. 209908, filed 29-06-2009

US – appl. no. 12/997,276, filed
on 10-Dec-2010

EU – appl. no. 09773041.0, 06-01-2011

 

Inventors: Aharon Gedanken, Yeshayahu Nitzan,
Perelshtein Ilana, Perkas Nina, Applerot Guy

 

Title: DOPED METAL OXIDE NANOPARTICLES
OF AND USES THEREOF

 

PCT/IL2014/050406, filed on 05-May-2014

 

Inventors: Gedanken Aharon , Banin Ehud,
Perelshtein Ilana , Lubart Rachel , Lipovsky Anat , Malka Eyal , Yeshayahu Nitzan , Perkas Nina , Shalom Yakov , Lellouche Jonathan
, Patrick Tal , Eshed Michal , Naparstek Livnat

 

    	18

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00239-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00239-of-00352.parquet"}]]