Document:

ex102.htm

Exhibit 10.2

 

EXCHANGE AGREEMENT

THIS EXCHANGE AGREEMENT (the “Agreement”), dated as of September 18, 2012, is made by and between Vanity Events Holding, Inc., a Delaware corporation (“Company”), and IBC Funds, LLC (“Holder”).

WHEREAS, subject to the terms and conditions set forth in this Agreement and pursuant to Section 3(a)(9) of the Securities Act of 1933, as amended (the “Securities Act”), the Company desires to exchange with the Holder, and the Holder desires to exchange with the Company, securities of the Company as more fully described in this Agreement.

WHEREAS, on August 7, 2012, the Holder purchased a promissory note, dated January 28, 2011, in the aggregate principal amount of $10,000 and on August 1, 2012 a promissory note, dated March 23, 2011, in the aggregate principal amount of $11,500 (collectively, the “Notes”) from the holders in accordance with the terms of those certain Assignment Agreements, dated August 1, 2012 (the “Assignment Agreements”);

WHEREAS, Company and Holder wish to exchange the Notes for a Convertible Promissory Note (as defined below), of the Company;

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 Holder agree as follows:

1.             Terms of the Exchange. The Company and Holder hereby agree that as of September 18, 2012, the outstanding principal balance (including all interest due and payable) of the Notes is equal to $21,500. The Company and Holder further agree that the Holder will exchange the Notes and will relinquish any and all other rights he may have under the Notes in exchange for  a convertible promissory note, due September 18, 2013, in the aggregate principal amount of $21,500 convertible into shares of the Company’s common stock at a ninety percent (90%) discount of the average closing bid price of the Company’s common stock during the five (5) trading days immediately preceding the conversion date, provided, however, that in no event shall the Conversion Price be an amount that is lower than $0.001, substantially in the form annexed hereto as Appendix A (the “New Note”).

2.            Closing. Upon satisfaction of the conditions set forth herein, a closing shall occur at the principal offices of the Company, or such other location as the parties shall mutually agree. At closing, Holder shall deliver its Notes to the Company and the Company shall deliver to such Holder the New Note in the name and amount as indicated on Schedule A annexed hereto.  Upon closing, any and all obligations of the Company to Holder under the Notes shall be fully satisfied, the Notes shall be terminated and marked "paid in full", and Holder will have no remaining rights, powers, privileges, remedies or interests under the Notes.

 

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

  

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4.             Representations and Warranties of the Holder. The Holder represents and warrants as of the date hereof and as of the closing to the Company as follows:

a.           Authorization; Enforcement. The Holder has the requisite corporate power and authority to enter into and to consummate the transactions contemplated by this Agreement and otherwise to carry out its obligations hereunder and thereunder.  The execution and delivery of this Agreement by the Holder 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 Holder and no further action is required by the Holder.  This Agreement has been (or upon delivery will have been) duly executed by the Holder and, when delivered in accordance with the terms hereof, will constitute the valid and binding obligation of the Holder enforceable against the Holder 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.           Tax Advisors. Such Holder has reviewed with its own tax advisors the U.S. federal, state, local and foreign tax consequences of this investment and the transactions contemplated by this Agreement. With respect to such matters, such Holder relies solely on such advisors and not on any statements or representations of the Company or any of its agents, written or oral. The Holder understands that it (and not the Company) shall be responsible for its own tax liability that may arise as a result of this investment or the transactions contemplated by this Agreement.

5.            Representations and Warranties of the Company. The Company hereby makes the following representations and warranties to the Holder:

a.           Authorization; Enforcement. The Company has the requisite corporate power and authority to enter into and to consummate the transactions contemplated by this Agreement and otherwise to carry out its obligations hereunder and thereunder.  The execution and delivery of this Agreement 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 of the Company or the Company’s stockholders in connection therewith.  This Agreement has been (or upon delivery will have been) duly executed by the Company and, when delivered in accordance with the terms hereof, will constitute the valid and binding obligation of the Company enforceable against the Company in accordance with its terms, except: (i) as limited by general equitable principles and applicable bankruptcy, insolvency, reorganization, moratorium and other laws of general application affecting enforcement of creditors’ rights generally, (ii) as limited by laws relating to the availability of specific performance, injunctive relief or other equitable remedies and (iii) insofar as indemnification and contribution provisions may be limited by applicable law.

6.   Release by the Holder.  In consideration of the foregoing, Holder releases and discharges Company, Company’s officers, directors, principals, control persons, past and present employees, insurers, successors, and assigns (“Company Parties”) from all actions, cause of action, suits, debts, dues, sums of money, accounts, reckonings, bonds, bills, specialties, covenants, contracts, controversies, agreements, promises, variances, trespasses, damages, judgments, extents, executions, claims, and demands whatsoever, in law, admiralty or equity, which against Company Parties ever had, now have or hereafter can, shall or may, have for, upon, or by reason of any matter, cause or thing whatsoever, whether or not known or unknown, arising under the Notes. 

 

 

  

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7. Miscellaneous

 

a. Successors and Assigns.  This Agreement shall be binding upon and inure to the benefit of the parties and their respective successors and assigns.

 

b. Governing Law; Jurisdiction; Waiver of Jury Trial.  This Agreement shall be governed by and construed under the laws of the State of New York without regard to the choice of law principles thereof. Each party hereby irrevocably submits to the exclusive jurisdiction of the state and federal courts sitting in the State of New York located in The City of New York, Borough of Manhattan for the adjudication of any dispute hereunder or in connection herewith or therewith or with any transaction contemplated hereby or thereby, and hereby irrevocably waives any objection that such suit, action or proceeding is brought in an inconvenient forum or that the venue of such suit, action or proceeding is improper.  Nothing contained herein shall be deemed to limit in any way any right to serve process in any manner permitted by law.  EACH PARTY HEREBY IRREVOCABLY WAIVES ANY RIGHT IT MAY HAVE, AND AGREES NOT TO REQUEST, A JURY TRIAL FOR THE ADJUDICATION OF ANY DISPUTE HEREUNDER OR IN CONNECTION WITH OR ARISING OUT OF THIS AGREEMENT OR ANY TRANSACTION CONTEMPLATED HEREBY.

 

c. Severability.  If any provision of this Agreement shall be invalid or unenforceable in any jurisdiction, such invalidity or unenforceability shall not affect the validity or enforceability of the remainder of this Agreement in that jurisdiction or the validity or enforceability of any provision of this Agreement in any other jurisdiction.

 

d. Counterparts/Execution.  This Agreement may be executed in two or more identical counterparts, all of which shall be considered one and the same agreement and shall become effective when counterparts have been signed by each party and delivered to the other party. In the event that any signature is delivered by facsimile transmission or by an e-mail which contains an electronic file of an executed signature page, such signature page 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 electronic file signature page (as the case may be) were an original thereof.

 

e. Notices.  Any notice or communication permitted or required hereunder shall be in writing and shall be deemed sufficiently given if hand-delivered or sent (i) postage prepaid by registered mail, return receipt requested, or (ii) by facsimile, to the respective parties as set forth below, or to such other address as either party may notify the other in writing.

 

	 	If to the Company, to: 	Vanity Events Holding, Inc.	 
	 	 	1111 Kane Concourse, Suite 304	 
	 	 	Bay Harbor Islands, FL  33154	 
	 	 	Attention:  CEO	 
	 	 	 	 
	 	If to Holder, to:  	IBC Funds, LLC	 
	 	 	5348 Vegas Drive Suite 333	 
	 	 	Las Vegas, NV 89108	 
	 	 	Attention: Samuel Oshana	 

 

  

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f. Expenses.  The parties hereto shall pay their own costs and expenses in connection herewith.

 

g. Entire Agreement; Amendments.  This Agreement constitutes the entire agreement between the parties with regard to the subject matter hereof and thereof, superseding all prior agreements or understandings, whether written or oral, between or among the parties.  This Agreement may be amended, modified, superseded, cancelled, renewed or extended, and the terms and conditions hereof may be waived, only by a written instrument signed by all parties, or, in the case of a waiver, by the party waiving compliance.  Except as expressly stated herein, no delay on the part of any party in exercising any right, power or privilege hereunder shall operate as a waiver thereof, nor shall any waiver on the part of any party of any right, power or privilege hereunder preclude any other or future exercise of any other right, power or privilege hereunder.

 

h. Headings.  The headings used in this Agreement are used for convenience only and are not to be considered in construing or interpreting this Agreement.

 

(Signature Pages Follow)

 

 

 

  

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IN WITNESS WHEREOF, the parties have caused this Agreement to be duly executed as of the day and year first above written.

 

	VANITY EVENTS HOLDING, INC.	 	 	 	 
	 	 	 	 	 
	
By: /s/Lloyd Lapidus

	 	 	
 

	 
	

Name: Lloyd Lapidus

	 	 	
 

	 
	

Title:  Interim CEO

	 	 	
 

	 
	 	 	 	 	 
	 	 	 	 	 
	HOLDER	 	 	 	 
	 	 	 	 	 
	IBC FUNDS LLC	 	 	 	 
	 	 	 	 	 
	By: /s/Samuel Oshana	 	 	 	 
	Name: Samuel Oshana	 	 	 	 
	Title: Managing Member	 	 	 	 
	 	 	 	 	 
	Address: 5348 Vegas Drive, Suite 333	 	 	 	 
	Las Vegas, NV 89108	 	 	 	 

 

 

  

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  SCHEDULE A

	
 

 

 

 

 

 

Name and Address

of Holder

	
 

 

 

 

 

Principal Amount of Outstanding on Notes

	
 

 

 

 

Principal Amount of New Note to be issued

	
IBC Funds LLC

5348 Vegas Drive, Suite 333

Las Vegas, NV 89108

	
$21,500

	
$21,500

 

 

 

6Exhibit 10.1

 

PURCHASE AGREEMENT

 

PURCHASE AGREEMENT
(the “Agreement”), dated as of September 19, 2012, by and between ADVANCED CELL TECHNOLOGY, INC., a Delaware
corporation (the “Company”), and LINCOLN PARK CAPITAL FUND, LLC, an Illinois limited liability company
(the “Investor”).

 

WHEREAS:

 

Subject to the terms
and conditions set forth in this Agreement, the Company wishes to sell to the Investor, and the Investor wishes to buy from the
Company, up to Thirty Five Million Dollars ($35,000,000) of the Company's common stock, $0.001 par value per share (the "Common
Stock"). The shares of Common Stock to be purchased hereunder (including, without limitation, the Initial Purchase Shares
(as defined herein)) are referred to herein as the "Purchase Shares."

 

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 the Investor hereby agree as follows:

 

1.CERTAIN DEFINITIONS.

 

For purposes of this
Agreement, the following terms shall have the following meanings:

 

(a)  “Available Amount”
means initially Thirty Five Million Dollars ($35,000,000) in the aggregate, which amount shall be reduced by (i) the Initial Purchase
Amount, (ii) the Purchase Amount and (iii) the Accelerated Purchase Share Amount actually purchased by the Investor each time the
Investor purchases Purchase Shares pursuant to Section 2 hereof.

 

(b)“Accelerated Purchase
Share Amount” means, with respect to any particular Accelerated Purchase Confirmation (as defined in Section 2(b)),
the lesser of (i) the amount of Purchase Shares directed by the Company on an Accelerated Purchase Notice or (ii) the Accelerated
Purchase Share Percentage multiplied by the trading volume of the Common Stock on the Principal Market on the Accelerated Purchase
Date during normal trading hours.

 

(c)“Accelerated
Purchase Date” means, with respect to any Accelerated Purchase made hereunder, the Business Day following the Purchase
Date pursuant to Section 2(b) hereof.

 

(d)“Accelerated
Purchase Notice” means, with respect to any Accelerated Purchase pursuant to Section 2(b) hereof, an irrevocable
written notice from the Company to the Investor directing the Investor to buy an amount of Purchase Shares equal to the lesser
of (i) the amount specified by the Company therein or (ii) the Accelerated Purchase Share Percentage, on the Accelerated Purchase
Date pursuant to Section 2(b) hereof as specified by the Company therein at the applicable Accelerated Purchase Price.

 

(e)“Accelerated
Purchase Share Percentage” means, with respect to any particular Accelerated Purchase Notice pursuant to Section 2(b)
hereof, a specified percentage as set forth in the Accelerated Purchase Notice, up to 30% of the aggregate shares of Common Stock
traded on the Principal Market during normal trading hours on the Accelerated Purchase Date.

 

(f)“Accelerated
Purchase Price” means the lower of (i) ninety-six percent (96%) of the VWAP during (A) the entire trading day on the
Accelerated Purchase Date, if the volume of shares of Common Stock traded on the Principal Market on the Accelerated Purchase Date
has not exceeded the Accelerated Purchase Share Volume Maximum, or (B) the portion of the trading day of the Accelerated Purchase
Date (calculated starting at the beginning of normal trading hours) until such time at which the volume of shares of Common Stock
traded on the Principal Market has exceeded the Accelerated Purchase Share Volume Maximum or (ii) the Closing Sale Price on the
Accelerated Purchase Date (to be appropriately adjusted for any reorganization, recapitalization, non-cash dividend, stock split,
reverse stock split or other similar transaction).

 

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(g)“Accelerated
Purchase Share Volume Maximum” means the number of shares of Common Stock traded on the Principal Market during normal
trading hours on the Accelerated Purchase Date equal to (i) the amount of shares of Common Stock properly directed by the Company
to be purchased on the Accelerated Purchase Notice, divided by (ii) the Accelerated Purchase Share Percentage (to be appropriately
adjusted for any reorganization, recapitalization, non-cash dividend, stock split, reverse stock split or other similar transaction).

 

(h)“Bankruptcy
Law” means Title 11, U.S. Code, or any similar federal or state law for the relief of debtors.

 

(i)“Business
Day” means any day on which the Principal Market is open for trading, including any day on which the Principal Market
is open for trading for a period of time less than the customary time.

 

(j)“Closing
Sale Price” means, for any security as of any date, the last closing trade price for such security on the Principal Market
as reported by the Principal Market.

 

(k)“Confidential Information”
means any information disclosed by either party to the other party, either directly or indirectly, in writing, orally or by inspection
of tangible objects (including, without limitation, documents, prototypes, samples, plant and equipment), which is designated as
"Confidential," "Proprietary" or some similar designation. Information communicated orally shall be considered
Confidential Information if such information is confirmed in writing as being Confidential Information within ten (10) Business
Days after the initial disclosure. Confidential Information may also include information disclosed to a disclosing party by third
parties. Confidential Information shall not, however, include any information which (i) was publicly known and made generally available
in the public domain prior to the time of disclosure by the disclosing party; (ii) becomes publicly known and made generally available
after disclosure by the disclosing party to the receiving party through no action or inaction of the receiving party; (iii) is
already in the possession of the receiving party at the time of disclosure by the disclosing party as shown by the receiving party’s
files and records immediately prior to the time of disclosure; (iv) is obtained by the receiving party from a third party without
a breach of such third party’s obligations of confidentiality; (v) is independently developed by the receiving party without
use of or reference to the disclosing party’s Confidential Information, as shown by documents and other competent evidence
in the receiving party’s possession; or (vi) is required by law to be disclosed by the receiving party, provided that the
receiving party gives the disclosing party prompt written notice of such requirement prior to such disclosure and assistance in
obtaining an order protecting the information from public disclosure.

 

(l)“Custodian”
means any receiver, trustee, assignee, liquidator or similar official under any Bankruptcy Law.

 

(m)“DTC”
means The Depository Trust Company, or any successor performing substantially the same function for the Company.

 

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(n)“DWAC
Shares” means Purchase Shares and Commitment Shares that are (i) issued in electronic form, (ii) freely tradable and
transferable and without restriction on resale and (iii) timely credited by the Company to the Investor’s or its designee’s
specified Deposit/Withdrawal at Custodian (DWAC) account with DTC under its Fast Automated Securities Transfer (FAST) Program,
or any similar program hereafter adopted by DTC performing substantially the same function.

 

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

 

(p)“Maturity
Date” means the first day of the month immediately following the thirty-six (36) month anniversary of the Commencement
Date.

 

(q)“PEA
Period” means the period commencing at 9:30 a.m., Eastern time, on the twentieth (20th) Business Day immediately
prior to, and ending at 9:30 a.m., Eastern time, on the Business Day immediately following, the effective date of any post-effective
amendment to the Registration Statement or New Registration Statement (as such terms are defined in the Registration Rights Agreement).

 

(r)“Person”
means an individual or entity including but not limited to any limited liability company, a partnership, a joint venture, a corporation,
a trust, an unincorporated organization and a government or any department or agency thereof.

 

(s)“Principal
Market” means the OTC Bulletin Board (it being understood that as used herein “OTC Bulletin Board” shall
also mean any successor or comparable market quotation system or exchange to the OTC Bulletin Board such as the OTCQB operated
by the OTC Markets Group, Inc.); provided, however, that in the event the Company’s Common Stock is ever listed or traded
on the Nasdaq Global Market, the Nasdaq Global Select Market, the Nasdaq Capital Market, the New York Stock Exchange, NYSE Arca
or the NYSE MKT, than the “Principal Market” shall mean such other market or exchange or any successor to the foregoing
on which the Company’s Common Stock is then listed or traded.

 

(t)“Purchase”
means any Regular Purchase or any Accelerated Purchase, as applicable.

 

(u)“Purchase
Amount” means, with respect to any particular Regular Purchase made hereunder, the portion of the Available Amount to
be purchased by the Investor pursuant to a Purchase Notice in accordance with Section 2(a) hereof.

 

(v)“Purchase
Date” means, with respect to any particular Regular Purchase made hereunder, the Business Day on which the Investor receives
by 4:30 p.m., Eastern time, of such Business Day a valid Purchase Notice that the Investor is to buy Purchase Shares pursuant to
Section 2(a) hereof.

 

(w)“Purchase
Notice” means, with respect to any Regular Purchase pursuant to Section 2(a), an irrevocable written notice from
the Company to the Investor directing the Investor to buy such Purchase Amount in Purchase Shares as specified by the Company therein
on the Purchase Date pursuant to Section 2(a) hereof.

 

(x)“Purchase
Price” means, with respect to any Regular Purchase, the lower of: (i) the lowest Sale Price on the applicable Purchase
Date and (ii) the arithmetic average of the three (3) lowest Closing Sale Prices for the Common Stock during the ten (10) consecutive
Business Days ending on the Business Day immediately preceding such Purchase Date (in each case, to be appropriately adjusted for
any reorganization, recapitalization, non-cash dividend, stock split or other similar transaction that occurs on or after the date
of this Agreement).

 

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(y)“Sale
Price” means any trade price for the shares of Common Stock on the Principal Market as reported by the Principal Market.

 

(z)“SEC”
means the U.S. Securities and Exchange Commission.

 

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

 

(bb) “Transfer Agent”
means the transfer agent of the Company as set forth in Section 11(f) hereof or such other Person who is then serving as
the transfer agent for the Company in respect of the Common Stock.

 

(cc)“VWAP”
means in respect of an applicable Accelerated Purchase Date, the volume weighted average price of the Common Stock on the Principal
Market, as reported on the Principal Market.

 

2. PURCHASE OF COMMON STOCK. 

 

Subject to the terms
and conditions set forth in this Agreement, the Company has the right to sell to the Investor, and the Investor has the obligation
to purchase from the Company, Purchase Shares as follows:

 

(a) Initial Purchase and Commencement
of Regular Sales of Common Stock. Upon execution of this Agreement, the Company shall sell to the Investor and the Investor
shall purchase (the “Initial Purchase”) 10,000,000 Purchase Shares (such initial Purchase Shares, the “Initial
Purchase Shares”) for aggregate consideration of $800,000 (the “Initial Purchase Amount”). Upon the
satisfaction of the conditions set forth in Sections 7 and 8 hereof (the “Commencement” and the
date of satisfaction of such conditions the “Commencement Date”) and thereafter, the Company shall have the
right, but not the obligation, to deliver to the Investor from time to time a Purchase Notice directing the Investor to buy Purchase
Shares (each such purchase a “Regular Purchase”) in any amount up to 2,500,000 Purchase Shares per Purchase
Notice at the applicable Purchase Price on the applicable Purchase Date; provided, however, that in no event shall the Purchase
Amount of a Regular Purchase exceed One Million Dollars ($1,000,000) per Business Day. The Company may deliver multiple Purchase
Notices to the Investor; provided, however, that at least one (1) Business Day shall have elapsed between (i) the
date on which the Investor has received all of the Purchase Shares as DWAC Shares in connection with the most recent prior Regular
Purchase and Accelerated Purchase (as applicable) and (ii) the date of delivery of a Purchase Notice to the Investor by the Company.
Notwithstanding the foregoing, the Company shall not deliver any Purchase Notices during the PEA Period.

 

(b)Accelerated Purchases.
Subject to the terms and conditions of this Agreement, in addition to purchases of Purchase Shares as described in Section 2(a)
above, with one Business Day’s prior written notice, the Company shall also have the right, but not the obligation, to direct
the Investor by the Company’s delivery to the Investor of an Accelerated Purchase Notice from time to time, and the Investor
thereupon shall have the obligation, to buy Purchase Shares at the Accelerated Purchase Price on the Accelerated Purchase Date
in an amount equal to the Accelerated Purchase Share Amount (each such purchase, an “Accelerated Purchase”).
The Company may deliver an Accelerated Purchase Notice to the Investor only on a date on which the Company also properly submitted
a Purchase Notice for a Regular Purchase and executed such Regular Purchase pursuant to and in accordance with Section 2(a)
hereof, and such Accelerated Purchase Notice may only be for Purchase Shares not to exceed the lesser of (i) the maximum percentage
of the Accelerated Purchase Share Percentage and (ii) two (2) times the number of Purchase Shares purchased pursuant to the corresponding
Regular Purchase. Upon completion of each Accelerated Purchase Date, the Accelerated Purchase Share Amount shall be set forth on
a confirmation of the Accelerated Purchase (an “Accelerated Purchase Confirmation”).

 

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(c) Payment for Purchase Shares.
With respect to the Initial Purchase, the Investor shall pay to the Company the Initial Purchase Amount as full payment for such
Initial Purchase Shares via wire transfer of immediately available funds on the same Business Day that the Investor receives such
Initial Purchase Shares, if such Initial Purchase Shares are received by the Investor before 1:00 p.m., Eastern time, or, if such
Initial Purchase Shares are received by the Investor after 1:00 p.m., Eastern time, the next Business Day. For each Regular Purchase,
the Investor shall pay to the Company an amount equal to the Purchase Amount with respect to such Regular Purchase as full payment
for such Purchase Shares via wire transfer of immediately available funds on the same Business Day that the Investor receives such
Purchase Shares, if such Purchase Shares are received by the Investor before 1:00 p.m., Eastern time, or, if such Purchase Shares
are received by the Investor after 1:00 p.m., Eastern time, the next Business Day. For each Accelerated Purchase, the Investor
shall pay to the Company an amount equal to the Purchase Amount with respect to such Accelerated Purchase as full payment for such
Purchase Shares via wire transfer of immediately available funds on the third Business Day following the date that the Investor
receives such Purchase Shares. If the Company or the Transfer Agent shall fail for any reason or for no reason to electronically
transfer any Purchase Shares as DWAC Shares in respect of a Regular Purchase or Accelerated Purchase (as applicable) within three
(3) Business Days following the receipt by the Company of the Purchase Price or Accelerated Purchase Price, respectively, therefor
in compliance with this Section 2(c), and if on or after such Business Day the Investor purchases (in an open market transaction
or otherwise) shares of Common Stock to deliver in satisfaction of a sale by the Investor of such Purchase Shares that the Investor
anticipated receiving from the Company in respect of such Regular Purchase or Accelerated Purchase (as applicable), then the Company
shall, within three (3) Business Days after the Investor’s request, either (i) pay cash to the Investor in an amount equal
to the Investor’s total purchase price (including brokerage commissions, if any) for the shares of Common Stock so purchased
(the “Cover Price”), at which point the Company’s obligation to deliver such Purchase Shares as DWAC Shares
shall terminate, or (ii) promptly honor its obligation to deliver to the Investor such Purchase Shares as DWAC Shares and pay cash
to the Investor in an amount equal to the excess (if any) of the Cover Price over the total Purchase Price for such Regular Purchase
plus the total Accelerated Purchase Price for such Accelerated Purchase (as applicable). The Company shall not issue any fraction
of a share of Common Stock upon any Purchase. If the issuance would result in the issuance of a fraction of a share of Common Stock,
the Company shall round such fraction of a share of Common Stock up or down to the nearest whole share. All payments made under
this Agreement shall be made in lawful money of the United States of America or wire transfer of immediately available funds to
such account as the Company may from time to time designate by written notice in accordance with the provisions of this Agreement.
Whenever any amount expressed to be due by the terms of this Agreement is due on any day that is not a Business Day, the same shall
instead be due on the next succeeding day that is a Business Day.

 

(d) Purchase Price Floor.
The Company and the Investor shall not effect any Purchases under this Agreement on any Purchase Date that the Closing Sale Price
is less than the Floor Price. "Floor Price" means $.03, which shall be appropriately adjusted for any reorganization,
recapitalization, non-cash dividend, stock split or other similar transaction and, effective upon the consummation of any such
reorganization, recapitalization, non-cash dividend, stock split or other similar transaction, the Floor Price shall mean the lower
of (i) the adjusted price and (ii) $1.00. 

 

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(e)Beneficial
Ownership Limitation. Notwithstanding anything to the contrary contained in this Agreement, the Company shall not issue
or sell, and the Investor shall not purchase or acquire, any shares of Common Stock under this Agreement which, when
aggregated with all other shares of Common Stock then beneficially owned by the Investor and its affiliates (as calculated pursuant
to Section 13(d) of the Exchange Act and Rule 13d-3 promulgated thereunder), would result in the beneficial ownership by the Investor
and its affiliates of more than 9.99% of the then issued and outstanding shares of Common Stock (the “Beneficial
Ownership Limitation”). Upon the written or oral request of the Investor, the Company shall promptly (but not later than
one (1) Business Day) confirm orally or in writing to the Investor the number of shares of Common Stock then outstanding. The Investor
and the Company shall each cooperate in good faith in the determinations required hereby and the application hereof. The Investor’s
written certification to the Company of the applicability of the Beneficial Ownership Limitation, and the resulting effect thereof
hereunder at any time, shall be conclusive with respect to the applicability thereof and such result absent manifest error.

 

3.INVESTOR'S
REPRESENTATIONS AND WARRANTIES.

 

The Investor represents
and warrants to the Company that as of the date hereof and as of the Commencement Date:

 

(a)Investment
Purpose.  The Investor is acquiring the Purchase Shares and Commitment Shares (“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 the Investor’s right to sell the Securities at any time
pursuant to the Registration Statement described herein or otherwise in compliance with applicable federal and state securities
laws).  The Investor is acquiring the Securities hereunder in the ordinary course of its business.

 

(b)Accredited
Investor Status. The Investor is an "accredited investor" as that term is defined in Rule 501(a)(3) of Regulation
D promulgated under the Securities Act.

 

(c)Reliance
on Exemptions. The Investor understands that the Securities may be offered and sold to it in reliance on specific exemptions
from the registration requirements of United States federal and state securities laws and that the Company is relying in part upon
the truth and accuracy of, and the Investor's compliance with, the representations, warranties, agreements, acknowledgments and
understandings of the Investor set forth herein in order to determine the availability of such exemptions and the eligibility of
the Investor to acquire the Securities.

 

(d)Information.
The Investor understands that its investment in the Securities involves a high degree of risk. The Investor (i) is able to bear
the economic risk of an investment in the Securities including a total loss thereof, (ii) has such knowledge and experience in
financial and business matters that it is capable of evaluating the merits and risks of the proposed investment in the Securities
and (iii) has had an opportunity to ask questions of and receive answers from the officers of the Company concerning the financial
condition and business of the Company and others matters related to an investment in the Securities. Neither such inquiries nor
any other due diligence investigations conducted by the Investor or its representatives shall modify, amend or affect the Investor's
right to rely on the Company's representations and warranties contained in Section 4 below. The Investor has sought such accounting,
legal and tax advice as it has considered necessary to make an informed investment decision with respect to its acquisition of
the Securities.

 

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(e)No Governmental
Review. The Investor understands that no U.S. federal or state agency or any other government or governmental agency has passed
on or made any recommendation or endorsement of the Securities or the fairness or suitability of an investment in the Securities
nor have such authorities passed upon or endorsed the merits of the offering of the Securities.

 

(f)Transfer
or Sale. The Investor understands that (i) the Securities may not be offered for sale, sold, assigned or transferred unless
(A) registered pursuant to the Securities Act or (B) an exemption exists permitting such Securities to be sold, assigned or transferred
without such registration; (ii) any sale of the Securities made in reliance on Rule 144 may be made only in accordance with the
terms of Rule 144 and further, if Rule 144 is not applicable, any resale of the Securities under circumstances in which the seller
(or the Person through whom the sale is made) may be deemed to be an underwriter (as that term is defined in the Securities Act)
may require compliance with some other exemption under the Securities Act or the rules and regulations of the SEC thereunder.

 

(g)Validity;
Enforcement. This Agreement has been duly and validly authorized, executed and delivered on behalf of the Investor and is a
valid and binding agreement of the Investor enforceable against the Investor in accordance with its terms, subject as to enforceability
to general principles of equity and to applicable bankruptcy, insolvency, reorganization, moratorium, liquidation and other similar
laws relating to, or affecting generally, the enforcement of applicable creditors' rights and remedies.

 

(h)Residency.
The Investor is a resident of the State of Illinois.

 

(i)No Short
Selling. The Investor represents and warrants to the Company that at no time prior to the date of this Agreement has any of
the Investor, its agents, representatives or affiliates engaged in or effected, in any manner whatsoever, directly or indirectly,
any (i) "short sale" (as such term is defined in Rule 200 of Regulation SHO of the Exchange Act) of the Common Stock
or (ii) hedging transaction, which establishes a net short position with respect to the Common Stock.

 

4.REPRESENTATIONS
AND WARRANTIES OF THE COMPANY.

 

The Company represents
and warrants to the Investor that as of the date hereof and as of the Commencement Date:

 

(a)Organization
and Qualification. The Company and each of the Subsidiaries (which for purposes of this Agreement means any entity in which
the Company, directly or indirectly, owns 50% or more of the voting stock or capital stock or other similar equity interests) 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. The Company has no Subsidiaries except as set forth on Schedule
4(a).

 

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(b)Authorization;
Enforcement; Validity. (i) The Company has the requisite corporate power and authority to enter into and perform its obligations
under this Agreement, the Registration Rights Agreement and each of the other agreements entered into by the parties on the Commencement
Date and attached hereto as exhibits to this Agreement (collectively, the "Transaction Documents"), and to issue
the Securities in accordance with the terms hereof and thereof, provided that the Investor acknowledges that it understands that
the Company may not have sufficient authorized shares of Common Stock to allow for the issuance of all of the Securities (other
than the Commitment Shares and the Initial Purchase Shares) as of the Commencement Date, (ii) the execution and delivery of the
Transaction Documents by the Company and the consummation by it of the transactions contemplated hereby and thereby, including
without limitation, the issuance of the Commitment Shares and the reservation for issuance and the issuance of the Purchase Shares
issuable under this Agreement, have been duly authorized by the Company's Board of Directors and no further consent or authorization
is required by the Company, its Board of Directors or its stockholders, (iii) this Agreement has been, and each other Transaction
Document shall be on the Commencement Date, duly executed and delivered by the Company and (iv) this Agreement constitutes, and
each other Transaction Document upon its execution on behalf of the Company, shall constitute, the valid and binding obligations
of the Company enforceable against the Company in accordance with their terms, except as such enforceability may be limited by
general principles of equity or applicable bankruptcy, insolvency, reorganization, moratorium, liquidation or similar laws relating
to, or affecting generally, the enforcement of creditors' rights and remedies. The Board of Directors of the Company has approved
the resolutions (the “Signing Resolutions”) substantially in the form as set forth as Exhibit C attached
hereto to authorize this Agreement and the transactions contemplated hereby. The Signing Resolutions are valid, in full force and
effect and have not been modified or supplemented in any respect. The Company has delivered to the Investor a true and correct
copy of a unanimous written consent adopting the Signing Resolutions executed by all of the members of the Board of Directors of
the Company. No other approvals or consents of the Company’s Board of Directors and/or stockholders is necessary under applicable
laws and the Company’s Certificate of Incorporation and/or Bylaws to authorize the execution and delivery of this Agreement
or any of the transactions contemplated hereby, including, but not limited to, the issuance of the Commitment Shares and the issuance
of the Purchase Shares.

 

(c)Capitalization.
As of the date hereof, the authorized capital stock of the Company is set forth on Schedule 4(c). Except as disclosed in
Schedule 4(c), (i) no shares of the Company's capital stock are subject to preemptive rights or any other similar rights
or any liens or encumbrances suffered or permitted by the Company, (ii) there are no outstanding debt securities, (iii) there are
no outstanding options, warrants, scrip, rights to subscribe to, calls or commitments of any character whatsoever relating to,
or securities or rights convertible into, any shares of capital stock of the Company or any of its Subsidiaries, or contracts,
commitments, understandings or arrangements by which the Company or any of its Subsidiaries is or may become bound to issue additional
shares of capital stock of the Company or any of its Subsidiaries or options, warrants, scrip, rights to subscribe to, calls or
commitments of any character whatsoever relating to, or securities or rights convertible into, any shares of capital stock of the
Company or any of its Subsidiaries, (iv) there are no agreements or arrangements under which the Company or any of its Subsidiaries
is obligated to register the sale of any of their securities under the Securities Act (except the Registration Rights Agreement),
(v) there are no outstanding securities or instruments of the Company or any of its Subsidiaries which contain any redemption or
similar provisions, and there are no contracts, commitments, understandings or arrangements by which the Company or any of its
Subsidiaries is or may become bound to redeem a security of the Company or any of its Subsidiaries, (vi) there are no securities
or instruments containing anti-dilution or similar provisions that will be triggered by the issuance of the Securities as described
in this Agreement and (vii) the Company does not have any stock appreciation rights or "phantom stock" plans or agreements
or any similar plan or agreement. The Company has furnished to the Investor true and correct copies of the Company's Certificate
of Incorporation, as amended and as in effect on the date hereof (the "Certificate of Incorporation"), and the Company's
By-laws, as amended and as in effect on the date hereof (the "By-laws"), and summaries of the terms of all securities
convertible into or exercisable for Common Stock, if any, and copies of any documents containing the material rights of the holders
thereof in respect thereto.

 

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(d)Issuance
of Securities. Upon issuance and payment therefor in accordance with the terms and conditions of this Agreement, the Purchase
Shares, shall be validly issued, fully paid and nonassessable and free from all taxes, liens and charges with respect to the issue
thereof, with the holders being entitled to all rights accorded to a holder of Common Stock. The Initial Purchase Shares and Commitment
Shares have been duly authorized and, upon issuance in accordance with the terms hereof, the Initial Purchase Shares and Commitment
Shares shall be validly issued, fully paid and non-assessable and free from all taxes, liens and charges with respect to the issue
thereof. 290,000,000 shares of Common Stock have been duly authorized and reserved for issuance upon purchase under this Agreement
as Purchase Shares.

 

(e)No Conflicts.
Except as disclosed in Schedule 4(e), the execution, delivery and performance of the Transaction Documents by the Company
and the consummation by the Company of the transactions contemplated hereby and thereby (including, without limitation, the reservation
for issuance and issuance of the Purchase Shares) will not (i) result in a violation of the Certificate of Incorporation, any Certificate
of Designations, Preferences and Rights of any outstanding series of preferred stock of the Company or the By-laws or (ii) conflict
with, or constitute a default (or an event which with notice or lapse of time or both would become a default) under, or give to
others any rights of termination, amendment, acceleration or cancellation of, any agreement, indenture or instrument to which the
Company or any of its Subsidiaries is a party, or result in a violation of any law, rule, regulation, order, judgment or decree
(including federal and state securities laws and regulations and the rules and regulations of the Principal Market applicable to
the Company or any of its Subsidiaries) or by which any property or asset of the Company or any of its Subsidiaries is bound or
affected, except in the case of conflicts, defaults, terminations, amendments, accelerations, cancellations and violations under
clause (ii), which could not reasonably be expected to result in a Material Adverse Effect. Except as disclosed in Schedule
4(e), neither the Company nor its Subsidiaries is in violation of any term of or in default under its Certificate of Incorporation,
any Certificate of Designation, Preferences and Rights of any outstanding series of preferred stock of the Company or By-laws or
their organizational charter or by-laws, respectively. Except as disclosed in Schedule 4(e), neither the Company nor any
of its Subsidiaries is in violation of any term of or is in default under any material contract, agreement, mortgage, indebtedness,
indenture, instrument, judgment, decree or order or any statute, rule or regulation applicable to the Company or its Subsidiaries,
except for possible conflicts, defaults, terminations or amendments which could not reasonably be expected to have a Material Adverse
Effect. The business of the Company and its Subsidiaries is not being conducted, and shall not be conducted, in violation of any
law, ordinance, regulation of any governmental entity, except for possible violations, the sanctions for which either individually
or in the aggregate could not reasonably be expected to have a Material Adverse Effect. Except as specifically contemplated by
this Agreement and as required under the Securities Act or applicable state securities laws, the Company is not required to obtain
any consent, authorization or order of, or make any filing or registration with, any court or governmental agency or any regulatory
or self-regulatory agency in order for it to execute, deliver or perform any of its obligations under or contemplated by the Transaction
Documents in accordance with the terms hereof or thereof. Except as disclosed in Schedule 4(e), all consents, authorizations,
orders, filings and registrations which the Company is required to obtain pursuant to the preceding sentence shall be obtained
or effected on or prior to the Commencement Date. Except as listed in Schedule 4(e), since one year prior to the date hereof,
the Company has not received nor delivered any notices or correspondence from or to the Principal Market. The Principal Market
has not commenced any delisting proceedings against the Company.

 

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(f)SEC
Documents; Financial Statements. Except as disclosed in Schedule 4(f) 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
Documents”) on a timely basis or has received a valid extension of such time of filing and has filed any such SEC Documents
prior to the expiration of any such extension.  As of their respective dates, the SEC Documents complied in all material
respects with the requirements of the Securities Act and the Exchange Act, as applicable, and none of the SEC Documents, 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 Documents 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. Except as listed in Schedule 4(f), the Company has received no notices
or correspondence from the SEC for the one year preceding the date hereof. Except as set forth in the Current Report on
Form 8-K filed by the Company with the SEC on May 31, 2012 (the “Matter”), the SEC has not commenced any enforcement
proceedings against the Company or any of its subsidiaries.

 

(g)Absence of
Certain Changes. Except as disclosed in Schedule 4(g), since the filing of the Company’s Form 10-Q for the period
ending June 30, 2012, there has been no material adverse change in the business, properties, operations, financial condition or
results of operations of the Company or its Subsidiaries. The Company has not taken any steps, and does not currently expect to
take any steps, to seek protection pursuant to any Bankruptcy Law nor does the Company or any of its Subsidiaries have any knowledge
or reason to believe that its creditors intend to initiate involuntary bankruptcy or insolvency proceedings. The Company
is financially solvent and is generally able to pay its debts as they become due.

 

(h)Absence of
Litigation. Other than the Matter, there is no action, suit, proceeding, inquiry or investigation before or by any court, public
board, government agency, self-regulatory organization or body pending or, to the knowledge of the Company or any of its Subsidiaries,
threatened against or affecting the Company, the Common Stock or any of the Company's Subsidiaries or any of the Company's or the
Company's Subsidiaries' officers or directors in their capacities as such, which could reasonably be expected to have a Material
Adverse Effect. A description of each action, suit, proceeding, inquiry or investigation before or by any court, public board,
government agency, self-regulatory organization or body which, as of the date of this Agreement, is pending or threatened in writing
against or affecting the Company, the Common Stock or any of the Company's Subsidiaries or any of the Company's or the Company's
Subsidiaries' officers or directors in their capacities as such, is set forth in Schedule 4(h).

 

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(i)Acknowledgment
Regarding Investor's Status. The Company acknowledges and agrees that the Investor is acting solely in the capacity of arm's
length purchaser with respect to the Transaction Documents and the transactions contemplated hereby and thereby. The Company further
acknowledges that the Investor is not 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 hereby and thereby and any advice given by the Investor
or any of its representatives or agents in connection with the Transaction Documents and the transactions contemplated hereby and
thereby is merely incidental to the Investor's purchase of the Securities. The Company further represents to the Investor that
the Company's decision to enter into the Transaction Documents has been based solely on the independent evaluation by the Company
and its representatives and advisors.

 

(j)No General
Solicitation. Neither the Company, nor any of its affiliates, nor any Person acting on its or their behalf, has engaged in
any form of general solicitation or general advertising (within the meaning of Regulation D under the Securities Act) in connection
with the offer or sale of the Securities.

 

(k)Intellectual
Property Rights. The Company and its Subsidiaries own or possess adequate rights or licenses to use all material trademarks,
trade names, service marks, service mark registrations, service names, patents, patent rights, copyrights, inventions, licenses,
approvals, governmental authorizations, trade secrets and rights necessary to conduct their respective businesses as now conducted.
Except as set forth on Schedule 4(k), none of the Company's material trademarks, trade names, service marks, service mark
registrations, service names, patents, patent rights, copyrights, inventions, licenses, approvals, government authorizations, trade
secrets or other intellectual property rights have expired or terminated, or, by the terms and conditions thereof, could expire
or terminate within two years from the date of this Agreement. The Company and its Subsidiaries do not have any knowledge of any
infringement by the Company or its Subsidiaries of any material trademark, trade name rights, patents, patent rights, copyrights,
inventions, licenses, service names, service marks, service mark registrations, trade secret or other similar rights of others,
or of any such development of similar or identical trade secrets or technical information by others and, except as set forth on
Schedule 4(k), there is no claim, action or proceeding being made or brought against, or to the Company's knowledge, being
threatened against, the Company or its Subsidiaries regarding trademark, trade name, patents, patent rights, invention, copyright,
license, service names, service marks, service mark registrations, trade secret or other infringement, which could reasonably be
expected to have a Material Adverse Effect.

 

(l)Environmental
Laws. The Company and its Subsidiaries (i) are in compliance with any and all applicable foreign, federal, state and local
laws and regulations relating to the protection of human health and safety, the environment or hazardous or toxic substances or
wastes, pollutants or contaminants (“Environmental Laws”), (ii) have received all permits, licenses or other
approvals required of them under applicable Environmental Laws to conduct their respective businesses and (iii) are in compliance
with all terms and conditions of any such permit, license or approval, except where, in each of the three foregoing clauses, the
failure to so comply could not reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect.

 

(m)Title.
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, encumbrances and defects (“Liens”) and, except for Liens as do not materially affect
the value of such property and do not materially interfere with the use made and proposed to be made of such property by the Company
and the Subsidiaries and Liens for the payment of federal, state or other taxes, 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 with such
exceptions as are not material and do not interfere with the use made and proposed to be made of such property and buildings by
the Company and its Subsidiaries. Any real property and facilities
held under lease by the Company and any of its Subsidiaries are held by them under valid, subsisting and enforceable leases with
such exceptions as are not material and do not interfere with the use made and proposed to be made of such property and buildings
by the Company and its Subsidiaries.

 

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(n)Insurance.
The Company and each of its Subsidiaries are insured by insurers of recognized financial responsibility against such losses and
risks and in such amounts as management of the Company believes to be prudent and customary in the businesses in which the Company
and its Subsidiaries are engaged. Neither the Company nor any such Subsidiary has been refused any insurance coverage sought or
applied for and neither the Company nor any such 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 at a cost that would not materially and adversely affect the condition, financial or otherwise, or the earnings,
business or operations of the Company and its Subsidiaries, taken as a whole.

 

(o)Regulatory
Permits. The Company and its Subsidiaries possess all material certificates, authorizations and permits issued by the appropriate
federal, state or foreign regulatory authorities necessary to conduct their respective businesses, and neither the Company nor
any such Subsidiary has received any notice of proceedings relating to the revocation or modification of any such certificate,
authorization or permit.

 

(p)Tax Status.
The Company and each of its Subsidiaries has made or filed all federal and state income and all other material tax returns, reports
and declarations required by any jurisdiction to which it is subject (unless and only to the extent that the Company and each of
its Subsidiaries has set aside on its books provisions reasonably adequate for the payment of all unpaid and unreported taxes)
and 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, except those being contested in good faith and has set aside on its books provision
reasonably adequate for the payment of all 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 know of no basis for any such claim.

 

(q)Transactions
With Affiliates.  Except as set forth in the SEC Documents,
none of the officers or directors of the Company and, to the knowledge of the Company, none of the employees of the Company 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, 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 or partner, in each case in excess of $100,000 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.

 

(r)Application
of Takeover Protections. The Company and its board of directors have taken or will take prior to the Commencement Date 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 Certificate of Incorporation or the
laws of the state of its incorporation which is or could become applicable to the Investor as a result of the transactions contemplated
by this Agreement, including, without limitation, the Company's issuance of the Securities and the Investor's ownership of the
Securities.

 

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(s) Disclosure.  Except
with respect to the material terms and conditions of the transactions contemplated by the Transaction Documents that will be timely
publicly disclosed by the Company, the Company confirms that neither it nor any other Person acting on its behalf has provided
the Investor or its agents or counsel with any information that it believes constitutes or might constitute material, non-public
information which is not otherwise disclosed in the Registration Statement or the SEC Documents.   The Company understands
and confirms that the Investor will rely on the foregoing representation in effecting acquisitions and sales of securities of the
Company.  All of the disclosure furnished by or on behalf of the Company to the Investor regarding the Company, its business
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
the Investor neither makes nor has made any representations or warranties with respect to the transactions contemplated hereby
other than those specifically set forth in Section 3 hereof.

 

(t)Foreign
Corrupt Practices.  Neither the Company, nor to the knowledge
of the Company, any agent or other Person acting on behalf of the Company, 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 made by any Person acting on its
behalf of which the Company is aware) which is in violation of law, or (iv) violated in any material respect any provision of the
Foreign Corrupt Practices Act of 1977, as amended.

 

(u)DTC Eligibility. The
Company, through the Transfer Agent, currently participates in the DTC Fast Automated Securities Transfer (FAST) Program and the
Common Stock can be transferred electronically to third parties via the DTC Fast Automated Securities Transfer (FAST) Program.

 

(v)Sarbanes-Oxley.
The Company is in material compliance with all provisions of the Sarbanes-Oxley Act of 2002, as amended, which are applicable to
it as of the date hereof.

 

(w)Certain Fees.
Except as disclosed on Schedule 4(w), no brokerage or finder’s fees or commissions are or will be payable by the Company
to any broker, financial advisor or consultant, finder, placement agent, investment banker, bank or other Person with respect to
the transactions contemplated by the Transaction Documents. Except as disclosed on Schedule 4(w), the Investor 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 4(w) that may be due in connection with the transactions contemplated by the Transaction Documents.

 

(x)Investment
Company. The Company is not, and immediately after receipt of payment for the Securities will not be, an “investment
company” within the meaning of the Investment Company Act of 1940, as amended.

 

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(y)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 pursuant to the Exchange Act nor has the Company received any notification that the SEC is currently contemplating
terminating such registration. The Company has not, in the twelve (12) months preceding the date hereof, received any notice from
any Person to the effect that the Company is not in compliance with the listing or maintenance requirements of the Principal 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.

 

(z)Accountants.
The Company’s accountants are set forth in the SEC Documents and, to the knowledge of the Company, such accountants are an
independent registered public accounting firm as required by the Securities Act.

 

(aa)Regulation
M Compliance. The Company has not, and to its knowledge no Person 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.

 

5.COVENANTS.

 

(a)Filing of
Form 8-K and Registration Statement. The Company agrees that it shall, within the time required under the Exchange Act, file
with the SEC a report on Form 8-K relating to the transactions contemplated by, and describing the material terms and conditions
of, the Transaction Documents (the “Current Report”). The Company shall also file within twenty (20) Business
Days from the date hereof a new registration statement (“Registration Statement”) covering only the resale of
the Purchase Shares (including, without limitation, the Initial Purchase Shares) and the Commitment Shares, in accordance with
the terms of the Registration Rights Agreement between the Company and the Investor, dated as of the date hereof (“Registration
Rights Agreement”). The Company shall permit the Investor to review and comment upon the Current Report at least two
(2) Business Days prior to its filing with the SEC, the Company shall give due consideration to all such comments, and the Company
shall not file the Current Report with the SEC in a form to which the Investor reasonably objects. The Investor shall use its reasonable
best efforts to comment upon the Current Report within one (1) Business Day from the date the Investor receives the final version
thereof from the Company.

 

(b)Blue Sky.
The Company shall take all such action, if any, as is reasonably necessary in order to obtain an exemption for or to qualify (i)
the issuance of the Commitment Shares and the sale of the Purchase Shares to the Investor under this Agreement and (ii) any subsequent
resale of the Commitment Shares and any Purchase Shares by the Investor, in each case, under applicable securities or "Blue
Sky" laws of the states of the United States in such states as is reasonably requested by the Investor from time to time,
and shall provide evidence of any such action so taken to the Investor.

 

(c)Listing/DTC.
The Company shall promptly secure the listing of all of the Purchase Shares and Commitment Shares to be issued to the Investor
hereunder on the Principal Market (subject to official notice of issuance) and upon each other national securities exchange or
automated quotation system, if any, upon which the Common Stock is then listed, and shall maintain, so long as any shares of Common
Stock shall be so listed, such listing of all such Securities from time to time issuable hereunder. The Company shall maintain
the listing of the Common Stock on the Principal Market and shall comply in all respects with the Company’s reporting, filing
and other obligations under the bylaws or rules and regulations of the Principal Market. Neither the Company nor any of its Subsidiaries
shall take any action that would reasonably be expected to result in the delisting or suspension of the Common Stock on the Principal
Market. The Company shall promptly, and in no event later than the following Business Day, provide to the Investor copies of any
notices it receives from any Person regarding the continued eligibility of the Common Stock for listing on the Principal Market.
The Company shall pay all fees and expenses in connection with satisfying its obligations under this Section 5(c). The Company
shall take all action necessary to ensure that its Common Stock can be transferred electronically as DWAC Shares.

 

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(d)Limitation
on Short Sales and Hedging Transactions. The Investor agrees that beginning on the date of this Agreement and ending on the
date of termination of this Agreement as provided in Section 11, the Investor and its agents, representatives and affiliates shall
not in any manner whatsoever enter into or effect, directly or indirectly, any (i) "short sale" (as such term is defined
in Rule 200 of Regulation SHO of the Exchange Act) of the Common Stock or (ii) hedging transaction, which establishes a net short
position with respect to the Common Stock.

 

(e)Issuance
of Commitment Shares. Immediately upon the execution of this Agreement, the Company shall cause to be issued to the Investor
as consideration for the Investor entering into this Agreement 8,750,000 shares of Common Stock (the "Commitment Shares")and
shall deliver to the Transfer Agent on the date of this Agreement the Initial Irrevocable Transfer Agent Instructions with respect
to the issuance of the Commitment Shares and the Initial Purchase Shares. For the avoidance of doubt, all of the Commitment Shares
shall be fully earned as of the date of this Agreement, whether or not the Commencement shall occur or any Purchase Shares are
purchased by the Investor under this Agreement and irrespective of any termination of this Agreement.

 

(f)Due Diligence;
Non-Public Information. The Investor shall have the right, from time to time as the Investor may reasonably deem appropriate,
to perform reasonable due diligence on the Company during normal business hours. The Company and its officers and employees shall
provide information and reasonably cooperate with the Investor in connection with any reasonable request by the Investor related
to the Investor's due diligence of the Company. Each party hereto agrees not to disclose any Confidential Information of the other
party to any third party and shall not use the Confidential Information for any purpose other than in connection with, or in furtherance
of, the transactions contemplated hereby. Each party hereto acknowledges that the Confidential Information shall remain the property
of the disclosing party and agrees that it shall take all reasonable measures to protect the secrecy of any Confidential Information
disclosed by the other party. The Company confirms that neither it nor any other Person acting on its behalf shall provide the
Investor or its agents or counsel with any information that constitutes or might constitute material, non-public information that
is not otherwise disclosed in the Registration Statement or prospectus supplements thereto or otherwise publicly disclosed in a
report, statement or other document filed by the Company with the SEC under the Exchange Act. In the event of a breach of the foregoing
covenant by the Company or any Person acting on its behalf (as determined in the reasonable good faith judgment of the Investor),
in addition to any other remedy provided herein or in the other Transaction Documents, the Investor shall have the right to make
a public disclosure, in the form of a press release, public advertisement or otherwise, of such material, non-public information
without the prior approval by the Company; provided that the Company shall have failed to publicly disclose such material, non-public
information prior to such disclosure by the Investor. The Investor shall not have any liability to the Company, any of its Subsidiaries,
or any of their respective directors, officers, employees, stockholders or agents, for any such disclosure. The Company understands
and confirms that the Investor shall be relying on the foregoing covenants in effecting transactions in securities of the Company.

 

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(g) Purchase Records. The
Investor and the Company shall each maintain records showing the remaining Available Amount at any given time and the dates and
Purchase Amounts for each Purchase or shall use such other method, reasonably satisfactory to the Investor and the Company.

 

(h)
Taxes.  The
Company shall pay any and all transfer, stamp or similar taxes that may be payable with respect to the issuance and delivery of
any shares of Common Stock to the Investor made under this Agreement. 

 

(i)Use of Proceeds.
The Company will use the net proceeds from the offering as described in the Registration Statement or the SEC Documents.

 

(j)Other Transactions.
The Company shall not enter into, announce or recommend to its stockholders any agreement, plan, arrangement or transaction in
or of which the terms thereof would restrict, materially delay, conflict with or impair the ability or right of the Company to
perform its obligations under the Transaction Documents, including, without limitation, the obligation of the Company to deliver
the Purchase Shares and the Commitment Shares to the Investor in accordance with the terms of the Transaction Documents.

 

6.TRANSFER AGENT
INSTRUCTIONS.

 

(a)On
the date of this Agreement, the Company shall issue irrevocable instructions to the Transfer Agent substantially in the form attached
hereto as Exhibit E to issue the Initial Purchase Shares and the Commitment Shares in accordance with the terms
of this Agreement (the “Initial Irrevocable Transfer Agent Instructions”). The certificate(s) representing
the Initial Purchase Shares and the Commitment Shares, except as set forth below, shall bear the following restrictive legend
(the “Restrictive Legend”):

 

THE SECURITIES REPRESENTED BY
THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE STATE SECURITIES LAWS. THE
SECURITIES HAVE BEEN ACQUIRED FOR INVESTMENT AND MAY NOT BE OFFERED FOR SALE, SOLD, TRANSFERRED OR ASSIGNED IN THE ABSENCE OF AN
EFFECTIVE REGISTRATION STATEMENT FOR THE SECURITIES UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE STATE SECURITIES
LAWS, UNLESS SOLD PURSUANT TO: (1) RULE 144 UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR (2) AN OPINION OF HOLDER’S COUNSEL,
IN A CUSTOMARY FORM, THAT REGISTRATION IS NOT REQUIRED UNDER SAID ACT OR APPLICABLE STATE SECURITIES LAWS.

 

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(b)On the earlier of (i) the Commencement Date and (ii) such time that the Investor shall request, provided all conditions
of Rule 144 under the Securities Act are met, the Company shall, no later than two (2) Business Days following the delivery by
the Investor to the Company or the Transfer Agent of one or more legended certificates representing the Initial Purchase Shares
and the Commitment Shares (which certificates the Investor shall promptly deliver on or prior to the first to occur of the events
described in clauses (i) and (ii) of this sentence), as directed by the Investor, issue and deliver (or cause to be issued and
delivered) to the Investor, as requested by the Investor, either: (A) a certificate representing such Initial Purchase Shares and
Commitment Shares that is free from all restrictive and other legends or (B) a number of shares of Common Stock equal to the number
of Initial Purchase Shares and Commitment Shares represented by the certificate(s) so delivered by the Investor as DWAC Shares.
The Company shall take all actions to carry out the intent and accomplish the purposes of the immediately preceding sentence, including,
without limitation, delivering all such legal opinions, consents, certificates, resolutions and instructions to the Transfer Agent,
and any successor transfer agent of the Company, as may be requested from time to time by the Investor or necessary or desirable
to carry out the intent and accomplish the purposes of the immediately preceding sentence. On the Commencement Date, the Company
shall issue to the Transfer Agent, and any subsequent transfer agent, (i) irrevocable instructions in the form substantially similar
to those used by the Investor in substantially similar transactions (the “Commencement Irrevocable Transfer Agent Instructions”)
and (ii) the notice of effectiveness of the Registration Statement in the form attached as an exhibit to the Registration Rights
Agreement (the “Notice of Effectiveness of Registration Statement”), in each case to issue the Commitment Shares,
the Initial Purchase Shares and the Purchase Shares in accordance with the terms of this Agreement and the Registration Rights
Agreement. All Purchase Shares to be issued from and after the Commencement Date to or for the benefit of the Investor pursuant
to this Agreement shall be issued only as DWAC Shares. The Company represents and warrants to the Investor that, while this Agreement
is effective, no instruction other than the Commencement Irrevocable Transfer Agent Instructions and the Notice of Effectiveness
of Registration Statement referred to in this Section 6(b) will be given by the Company to the Transfer Agent with respect
to the Commitment Shares, the Initial Purchase Shares or the Purchase Shares from and after Commencement, and the Commitment Shares,
the Initial Purchase Shares and the Purchase Shares shall otherwise be freely transferable on the books and records of the Company.
The Company agrees that if the Company fails to fully comply with the provisions of this Section 6(b) within five (5) Business
Days of the Investor providing the deliveries referred to above, the Company shall, at the Investor’s written instruction,
purchase such shares of Common Stock containing the Restrictive Legend from the Investor at the greater of the (i) Purchase Price
or Accelerated Purchase Price paid for such shares of Common Stock (as applicable) and (ii) the Closing Sale Price of the Common
Stock on the date of the Investor’s written instruction.

 

7. CONDITIONS
TO THE COMPANY'S RIGHT TO COMMENCE SALES OF SHARES OF COMMON STOCK.

 

The right of the Company
hereunder to commence sales of the Purchase Shares (other than the Initial Purchase Shares) is subject to the satisfaction of each
of the following conditions:

 

(a)The Investor
shall have executed each of the Transaction Documents and delivered the same to the Company;

 

(b)The Registration
Statement covering the resale of all of the Commitment Shares and Purchase Shares (including, without limitation, all of
the Initial Purchase Shares), subject to the limitations set forth in the Registration Rights Agreement, shall have been declared
effective under the Securities Act by the SEC and no stop order with respect to the Registration Statement shall be pending or
threatened by the SEC; and

 

(c)The representations
and warranties of the Investor shall be true and correct in all material respects as of the date hereof and as of the Commencement
Date as though made at that time.

 

 

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8. CONDITIONS TO THE INVESTOR'S OBLIGATION
TO PURCHASE SHARES OF COMMON STOCK. 

 

The obligation of the
Investor to buy Purchase Shares (other than the Initial Purchase Shares) under this Agreement is subject to the satisfaction of
each of the following conditions at or prior to the Commencement and, once such conditions have been initially satisfied, there
shall not be any ongoing obligation to satisfy such conditions after the Commencement has occurred:

 

(a)The Company
shall have executed each of the Transaction Documents and delivered the same to the Investor;

 

(b)The Company shall have issued
or caused to be issued to the Investor (i) one or more certificates representing the Commitment Shares and the Initial Purchase
Shares free from all restrictive and other legends or (ii) a number of shares of Common Stock equal to the number of Commitment
Shares and Initial Purchase Shares as DWAC Shares, in each case in accordance with Section 6(b);

 

(c)The Common Stock
shall be listed or quoted on the Principal Market, trading in the Common Stock shall not have been within the last 365 days suspended
by the SEC or the Principal Market, and all Securities to be issued by the Company to the Investor pursuant to this Agreement shall
have been approved for listing or quotation on the Principal Market in accordance with the applicable rules and regulations of
the Principal Market, subject only to official notice of issuance;

 

(d)The Investor
shall have received the opinions of the Company's legal counsel dated as of the Commencement Date substantially in the form of
Exhibit A attached hereto;

 

(e)The representations
and warranties of the Company shall be true and correct in all material respects (except to the extent that any such representations
and warranties are qualified as to materiality, in which case, such representations and warranties shall be true and correct as
so qualified) as of the date hereof and as of the Commencement Date as though made at that time (except for representations and
warranties that speak as of a specific date, which shall be true and correct as of such date), and the Company shall have performed,
satisfied and complied in all material respects with the covenants, agreements and conditions required by the Transaction Documents
to be performed, satisfied or complied with by the Company at or prior to the Commencement Date. The Investor shall have received
a certificate, executed by the CEO, President or CFO of the Company, dated as of the Commencement Date, to the foregoing effect
in the form attached hereto as Exhibit B;

 

(f)The Board of
Directors of the Company shall have adopted resolutions in the form attached hereto as Exhibit C which shall be in
full force and effect without any amendment or supplement thereto as of the Commencement Date;

 

(g)As of the Commencement
Date, the Company shall have reserved out of its authorized and unissued Common Stock, solely for the purpose of effecting purchases
of Purchase Shares hereunder, 290,000,000 shares of Common Stock;

 

(h)The Commencement
Irrevocable Transfer Agent Instructions and the Notice of Effectiveness of Registration Statement each shall have been delivered
to and acknowledged in writing by the Company and the Company's Transfer Agent (or any successor transfer agent);

 

(i)The Company
shall have delivered to the Investor a certificate evidencing the incorporation and good standing of the Company in the State of
Delaware issued by the Secretary of State of the State of Delaware as of a date within ten (10) Business Days of the Commencement
Date;

 

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(j)The Company
shall have delivered to the Investor a certified copy of the Certificate of Incorporation as certified by the Secretary of State
of the State of Delaware within ten (10) Business Days of the Commencement Date;

 

(k)The Company
shall have delivered to the Investor a secretary's certificate executed by the Secretary of the Company, dated as of the Commencement
Date, in the form attached hereto as Exhibit D;

 

(l)The Registration
Statement covering the resale of all of the Commitment Shares and Purchase Shares (including, without limitation, all of
the Initial Purchase Shares), subject to the limitations set forth in the Registration Rights Agreement, shall have been declared
effective under the Securities Act by the SEC and no stop order with respect to the Registration Statement shall be pending or
threatened by the SEC. The Company shall have prepared and filed with the SEC, not later than one (1) Business Day after the effective
date of the Registration Statement, a final and complete prospectus (the preliminary form of which shall be included in the Registration
Statement) and shall have delivered to the Investor a true and complete copy thereof. Such prospectus shall be current and available
for the resale of all of the Securities by the Investor. The Current Report shall have been filed with the SEC, as required pursuant
to Section 5(a). All reports, schedules, registrations, forms, statements, information and other documents required to have
been filed by the Company with the SEC at or prior to the Commencement Date pursuant to the reporting requirements of the Exchange
Act shall have been filed with the SEC within the applicable time periods prescribed for such filings under the Exchange Act;

 

(m)No Event of
Default has occurred, or any event which, after notice and/or lapse of time, would become an Event of Default has occurred;

 

(n)All federal,
state and local governmental laws, rules and regulations applicable to the transactions contemplated by the Transaction Documents
and necessary for the execution, delivery and performance of the Transaction Documents and the consummation of the transactions
contemplated thereby in accordance with the terms thereof shall have been complied with, and all consents, authorizations and orders
of, and all filings and registrations with, all federal, state and local courts or governmental agencies and all federal, state
and local regulatory or self-regulatory agencies necessary for the execution, delivery and performance of the Transaction Documents
and the consummation of the transactions contemplated thereby in accordance with the terms thereof shall have been obtained or
made, including, without limitation, in each case those required under the Securities Act, the Exchange Act, applicable state securities
or “Blue Sky” laws or applicable rules and regulations of the Principal Market, or otherwise required by the SEC, the
Principal Market or any state securities regulators;

 

(o)No statute,
regulation, order, decree, writ, ruling or injunction shall have been enacted, entered, promulgated, threatened or endorsed by
any federal, state, local or foreign court or governmental authority of competent jurisdiction which prohibits the consummation
of or which would materially modify or delay any of the transactions contemplated by the Transaction Documents; and

 

(p)Other than the
Matter, no action, suit or proceeding before any federal, state, local or foreign arbitrator or any court or governmental authority
of competent jurisdiction shall have been commenced or threatened, and no inquiry or investigation by any federal, state, local
or foreign governmental authority of competent jurisdiction shall have been commenced or threatened, against the Company, or any
of the officers, directors or affiliates of the Company, seeking to restrain, prevent or change the transactions contemplated by
the Transaction Documents, or seeking material damages in connection with such transactions.

 

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9. INDEMNIFICATION.

 

In consideration
of the Investor's execution and delivery of the Transaction Documents and acquiring the Securities hereunder and in addition to
all of the Company's other obligations under the Transaction Documents, the Company shall defend, protect, indemnify and hold
harmless the Investor and all of its affiliates, stockholders, officers, directors, employees and direct or indirect investors
and any of the foregoing Person's agents or other representatives (including, without limitation, those retained in connection
with the transactions contemplated by this Agreement) (collectively, the "Indemnitees") from and against any
and all actions, causes of action, suits, claims, losses, costs, penalties, fees, liabilities and damages, and expenses in connection
therewith (irrespective of whether any such Indemnitee is a party to the action for which indemnification hereunder is sought),
and including reasonable attorneys' fees and disbursements (the "Indemnified Liabilities"), incurred by any Indemnitee
as a result of, or arising out of, or relating to (a) any misrepresentation or breach of any representation or warranty made by
the Company in the Transaction Documents or any other certificate, instrument or document contemplated hereby or thereby, (b)
any breach of any covenant, agreement or obligation of the Company contained in the Transaction Documents or any other certificate,
instrument or document contemplated hereby or thereby, or (c) any cause of action, suit or claim brought or made against such
Indemnitee and arising out of or resulting from the execution, delivery, performance or enforcement of the Transaction Documents
or any other certificate, instrument or document contemplated hereby or thereby, other than, in the case of clause (c), with respect
to Indemnified Liabilities which directly and primarily result from the gross negligence or willful misconduct of the Indemnitee.
To the extent that the foregoing undertaking by the Company may be unenforceable for any reason, the Company shall make the maximum
contribution to the payment and satisfaction of each of the Indemnified Liabilities which is permissible under applicable law.
Payment under this indemnification shall be made within thirty (30) days from the date Investor makes written request for it.
A certificate containing reasonable detail as to the amount of such indemnification submitted to the Company by Investor shall
be conclusive evidence, absent manifest error, of the amount due from the Company to Investor.

  

10.EVENTS OF
DEFAULT. 

 

An "Event of
Default" shall be deemed to have occurred at any time as any of the following events occurs:

 

(a)the effectiveness
of the Registration Statement registering the resale of the Securities lapses for any reason (including, without limitation, the
issuance of a stop order or similar order) or the Registration Statement (or the prospectus forming a part thereof) is unavailable
to the Investor for the resale of any or all of the Securities to be issued to the Investor under the Transaction Documents, and
such lapse or unavailability continues for a period of ten (10) consecutive Business Days or for more than an aggregate of thirty
(30) Business Days in any 365-day period;

 

(b)the suspension
from trading or failure of the Common Stock to be listed on the Principal Market for a period of three (3) consecutive Business
Days;

 

(c)the delisting
of the Common Stock from the Principal Market, provided, however, that the Common Stock is not immediately thereafter trading on
the New York Stock Exchange, the Nasdaq Global Market, the Nasdaq Global Select Market, the Nasdaq Capital Market, NYSE Arca or
the NYSE MKT or any successor or comparable market to the foregoing.

 

    	20

    	 	

    
 

(d)the failure
for any reason by the Transfer Agent to issue Purchase Shares to the Investor within five (5) Business Days after the applicable
Purchase Date on which the Investor is entitled to receive such Purchase Shares;

 

(e)the Company
breaches any representation, warranty, covenant or other term or condition under any Transaction Document if such breach could
have a Material Adverse Effect and except, in the case of a breach of a covenant which is reasonably curable, only if such breach
continues for a period of at least five (5) Business Days;

 

(f)if any Person
commences a proceeding against the Company pursuant to or within the meaning of any Bankruptcy Law;

 

(g)if the Company,
pursuant to or within the meaning of any Bankruptcy Law, (i) commences a voluntary case, (ii) consents to the entry of an order
for relief against it in an involuntary case, (iii) consents to the appointment of a Custodian of it or for all or substantially
all of its property, or (iv) makes a general assignment for the benefit of its creditors or is generally unable to pay its debts
as the same become due;

 

(h)a court of competent
jurisdiction enters an order or decree under any Bankruptcy Law that (i) is for relief against the Company in an involuntary case,
(ii) appoints a Custodian of the Company or for all or substantially all of its property, or (iii) orders the liquidation of the
Company or any Subsidiary;

 

(i)if at any time
the Company is not eligible to transfer its Common Stock electronically as DWAC Shares; or

 

(j)other than as
a result of the Matter, a material adverse change occurs in the Company, its business, financial condition, operations or prospects.

 

In addition to any other rights and remedies
under applicable law and this Agreement, so long as an Event of Default has occurred and is continuing, or if any event which,
after notice and/or lapse of time, would become an Event of Default, has occurred and is continuing, or so long as the Closing
Sale Price is below the Floor Price, the Company shall not deliver to the Investor any Purchase Notice or Accelerated Purchase
Notice, and the Investor shall not purchase any Purchase Shares under this Agreement.

  

11.TERMINATION

 

This Agreement may
be terminated only as follows:

 

(a)If pursuant
to or within the meaning of any Bankruptcy Law, the Company commences a voluntary case or any Person commences a proceeding against
the Company, a Custodian is appointed for the Company or for all or substantially all of its property, or the Company makes a general
assignment for the benefit of its creditors, (any of which would be an Event of Default as described in Sections 10(f),
10(g) and 10(h) hereof) this Agreement shall automatically terminate without any liability or payment to the Company
(except as set forth below) without further action or notice by any Person.

 

(b)In the event
that the Commencement shall not have occurred on or before December 31, 2012, due to the failure to satisfy the conditions set
forth in Sections 7 and 8 above with respect to the Commencement, this Agreement may be terminated by either party
at the close of business on such date or thereafter without liability of such party to the other party (except as set forth below);
provided, however, that the right to terminate this Agreement under this Section 11(b) shall not be available to any party
if such party is then in breach of any covenant or agreement contained in this Agreement or any representation or warranty of such
party contained in this Agreement fails to be true and correct such that the conditions set forth in Section 7(c) or Section
8(e), as applicable, could not then be satisfied.

 

    	21

    	 	

    
 

(c) At any time
after the Commencement Date, the Company shall have the option to terminate this Agreement for any reason or for no reason by delivering
notice (a “Company Termination Notice”) to the Investor electing to terminate this Agreement without any liability
whatsoever of any party to any other party under this Agreement (except as set forth below). The Company Termination Notice shall
not be effective until one (1) Business Day after it has been received by the Investor.

 

(d)This Agreement
shall automatically terminate on the date that the Company sells and the Investor purchases the full Available Amount as provided
herein, without any action or notice on the part of any party and without any liability whatsoever of any party to any other party
under this Agreement (except as set forth below).

 

(e)If, for any
reason or for no reason, the full Available Amount has not been purchased in accordance with Section 2 of this Agreement
by the Maturity Date, this Agreement shall automatically terminate on the Maturity Date, without any action or notice on the part
of any party and without any liability whatsoever of any party to any other party under this Agreement (except as set forth below).

 

Except as set forth in Sections 11(a)
(in respect of an Event of Default under Sections 10(f), 10(g) and 10(h)) and 11(e), any termination of this
Agreement pursuant to this Section 11 shall be effected by written notice from the Company to the Investor, or the Investor
to the Company, as the case may be, setting forth the basis for the termination hereof. The representations and warranties and
covenants of the Company and the Investor contained in Sections 3, 4, 5, and 6 hereof, the indemnification
provisions set forth in Section 9 hereof and the agreements and covenants set forth in Sections 10, 11
and 12 shall survive the Commencement and any termination of this Agreement. No termination of this Agreement shall (i)
affect the Company’s or the Investor’s rights or obligations under (A) this Agreement with respect to pending Purchases
and the Company and the Investor shall complete their respective obligations with respect to any pending Purchases under this Agreement
and (B) the Registration Rights Agreement, which shall survive any such termination, or (ii) be deemed to release the Company or
the Investor from any liability for intentional misrepresentation or willful breach of any of the Transaction Documents.

 

12.MISCELLANEOUS.

 

(a)Governing
Law; Jurisdiction; Jury Trial. The corporate laws of the State of Delaware shall govern all issues concerning the relative
rights of the Company and its stockholders. All other questions concerning the construction, validity, enforcement and interpretation
of this Agreement and the other Transaction Documents shall be governed by the internal laws of the State of Illinois, without
giving effect to any choice of law or conflict of law provision or rule (whether of the State of Illinois or any other jurisdictions)
that would cause the application of the laws of any jurisdictions other than the State of Illinois. Each party hereby irrevocably
submits to the exclusive jurisdiction of the state and federal courts sitting in the City of Chicago, for the adjudication of any
dispute hereunder or under the other Transaction Documents or in connection herewith or therewith, or with any transaction contemplated
hereby or discussed herein, and hereby irrevocably waives, and agrees not to assert in any suit, action or proceeding, any claim
that it is not personally subject to the jurisdiction of any such court, that such suit, action or proceeding is brought in an
inconvenient forum or that the venue of such suit, action or proceeding is improper. Each party hereby irrevocably waives personal
service of process and consents to process being served in any such suit, action or proceeding by mailing a copy thereof to such
party at the address for such notices to it under this Agreement and agrees that such service shall constitute good and sufficient
service of process and notice thereof. Nothing contained herein shall be deemed to limit in any way any right to serve process
in any manner permitted by law. EACH PARTY HEREBY IRREVOCABLY WAIVES ANY RIGHT IT MAY HAVE, AND AGREES NOT TO REQUEST, A JURY
TRIAL FOR THE ADJUDICATION OF ANY DISPUTE HEREUNDER OR IN CONNECTION HEREWITH OR ARISING OUT OF THIS AGREEMENT OR ANY TRANSACTION
CONTEMPLATED HEREBY.

 

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(b)Counterparts.
This Agreement may be executed in two or more identical counterparts, all of which shall be considered one and the same agreement
and shall become effective when counterparts have been signed by each party and delivered to the other party; provided that a facsimile
signature or signature delivered by e-mail in a “.pdf” format data file shall be considered due execution and shall
be binding upon the signatory thereto with the same force and effect as if the signature were an original, not a facsimile signature
or a signature in a “.pdf” format data file.

 

(c)Headings.
The headings of this Agreement are for convenience of reference and shall not form part of, or affect the interpretation of, this
Agreement.

 

(d)Severability.
If any provision of this Agreement shall be invalid or unenforceable in any jurisdiction, such invalidity or unenforceability shall
not affect the validity or enforceability of the remainder of this Agreement in that jurisdiction or the validity or enforceability
of any provision of this Agreement in any other jurisdiction.

 

(e)Entire Agreement.
The Transaction Documents supersede all other prior oral or written agreements between the Investor, the Company, their affiliates
and Persons acting on their behalf with respect to the subject matter thereof, and this Agreement, the other Transaction Documents
and the instruments referenced herein contain the entire understanding of the parties with respect to the matters covered herein
and therein and, except as specifically set forth herein or therein, neither the Company nor the Investor makes any representation,
warranty, covenant or undertaking with respect to such matters. The Company acknowledges and agrees that is has not relied on,
in any manner whatsoever, any representations or statements, written or oral, other than as expressly set forth in the Transaction
Documents.

 

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

 

If to the Company:

Advanced Cell Technology, Inc.

33 Locke Drive

Marlborough, MA 01752

Telephone:508-756-1212

Facsimile:

Attention: 

 

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With a copy to:

Sichenzia Ross Friedman Ference
LLP

61 Broadway

New York, New York 10006

Telephone:(212) 930-9700

Facsimile: (212) 930-9725

Attention: Thomas A. Rose,
Esq.

 

If to the Investor:

Lincoln Park Capital Fund, LLC

440 North Wells, Suite 410

Chicago, IL 60654

Telephone:312-822-9300

Facsimile:312-822-9301

Attention:Josh Scheinfeld/Jonathan
Cope

 

With copies to (which
shall not constitute notice or service of process):

Greenberg
Traurig, LLP

The MetLife
Building

200 Park
Avenue

New York,
NY 10166

Telephone:(212)
801-9200

Facsimile:
(212) 801-6400

E-mail: mariscoa@gtlaw.com

Attention:Anthony
J. Marsico, Esq.

 

If to the Transfer Agent:

Interwest
Transfer Company, Inc.

1981 Murray
Holladay Road, Suite 100

Salt Lake
City, UT 84117

Telephone:(801) 272-9294

Facsimile:(801) 277-3147

Attention: Melinda Orth

 

or at such other address and/or facsimile
number and/or to the attention of such other Person as the recipient party has specified by written notice given to each other
party three (3) Business Days prior to the effectiveness of such change. Written confirmation of receipt (A) given by the recipient
of such notice, consent or other communication, (B) mechanically or electronically generated by the sender's facsimile machine
containing the time, date, and recipient facsimile number or (C) provided by a nationally recognized overnight delivery service,
shall be rebuttable evidence of personal service, receipt by facsimile or receipt from a nationally recognized overnight delivery
service in accordance with clause (i), (ii) or (iii) above, respectively.

 

(g)Successors
and Assigns. This Agreement shall be binding upon and inure to the benefit of the parties and their respective successors and
assigns. The Company shall not assign this Agreement or any rights or obligations hereunder without the prior written consent of
the Investor, including by merger or consolidation. The Investor may not assign its rights or obligations under this Agreement.

 

(h)No Third
Party Beneficiaries. This Agreement is intended for the benefit of the parties hereto and their respective permitted successors
and assigns, and is not for the benefit of, nor may any provision hereof be enforced by, any other Person.

 

    	24

    	 	

    
 

(i)Publicity.
The Investor shall have the right to approve before issuance any press release, SEC filing or any other public disclosure made
by or on behalf of the Company whatsoever with respect to, in any manner, the Investor, its purchases hereunder or any aspect of
the Transaction Documents or the transactions contemplated thereby; provided, however, that the Company shall be entitled, without
the prior approval of the Investor, to make any press release or other public disclosure (including any filings with the SEC) with
respect to such transactions as is required by applicable law and regulations so long as prior to making any such press release
or other public disclosure the Company and its counsel shall have provided the Investor and its counsel with a reasonable opportunity
to review and comment upon, and shall have consulted with the Investor and its counsel on the form and substance of, such press
release or other public disclosure at least two (2) Business Days prior to its release. The Investor must be provided with a copy
thereof at least two (2) Business Days prior to any release or use by the Company thereof. The Company agrees and acknowledges
that its failure to fully comply with this provision constitutes a Material Adverse Effect.

 

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

 

(k)No Financial
Advisor, Placement Agent, Broker or Finder. The Company represents and warrants to the Investor that, except as disclosed in
Schedule 4(w), it has not engaged any financial advisor, placement agent, broker or finder in connection with the transactions
contemplated hereby. The Investor represents and warrants to the Company that it has not engaged any financial advisor, placement
agent, broker or finder in connection with the transactions contemplated hereby. The Company shall be responsible for the payment
of any fees or commissions, if any, of any financial advisor, placement agent, broker or finder relating to or arising out of the
transactions contemplated hereby. The Company shall pay, and hold the Investor harmless against, any liability, loss or expense
(including, without limitation, attorneys' fees and out of pocket expenses) arising in connection with any such claim.

 

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

 

(m)Remedies,
Other Obligations, Breaches and Injunctive Relief. The Investor’s remedies provided in this Agreement shall be cumulative
and in addition to all other remedies available to the Investor under this Agreement, at law or in equity (including a decree of
specific performance and/or other injunctive relief), no remedy of the Investor contained herein shall be deemed a waiver of compliance
with the provisions giving rise to such remedy and nothing herein shall limit the Investor's right to pursue actual damages for
any failure by the Company to comply with the terms of this Agreement. The Company acknowledges that a breach by it of its obligations
hereunder will cause irreparable harm to the Investor and that the remedy at law for any such breach may be inadequate. The Company
therefore agrees that, in the event of any such breach or threatened breach, the Investor shall be entitled, in addition to all
other available remedies, to an injunction restraining any breach, without the necessity of showing economic loss and without any
bond or other security being required.

 

(n)Enforcement Costs. If:
(i) an attorney is retained to represent the Investor in any bankruptcy, reorganization, receivership or other proceedings affecting
creditors' rights and involving a claim under this Agreement; or (ii) an attorney is retained to represent the Investor in any
other proceedings whatsoever in connection with this Agreement, then the Company shall pay to the Investor, as incurred by the
Investor, all reasonable costs and expenses including attorneys' fees incurred in connection therewith, in addition to all other
amounts due hereunder.

 

    	25

    	 	

    
 

(o)Amendment and Waiver; Failure
or Indulgence Not Waiver. No provision of this Agreement may be amended or waived by the parties from and after the date that
is one (1) Business Day immediately preceding the initial filing of the Registration Statement with the SEC. Subject to the immediately
preceding sentence, (i) no provision of this Agreement may be amended other than by a written instrument signed by both parties
hereto and (ii) no provision of this Agreement may be waived other than in a written instrument signed by the party against whom
enforcement of such waiver is sought. No failure or delay in the exercise of any power, right or privilege hereunder shall operate
as a waiver thereof, nor shall any single or partial exercise of any such power, right or privilege preclude other or further exercise
thereof or of any other right, power or privilege.

 

 

 

* * * * *

 

    	26

    	 	

    
 

 

IN WITNESS WHEREOF, the Investor
and the Company have caused this Purchase Agreement to be duly executed as of the date first written above.

 

 

 

THE COMPANY:

 

ADVANCED CELL TECHNOLOGY,
INC.

By: /s/ Gary Rabin                    

Name: Gary Rabin

Title: CEO

 

 

INVESTOR:

 

LINCOLN PARK CAPITAL FUND,
LLC

BY: LINCOLN PARK CAPITAL,
LLC

BY: Rockledge
Capital Corporation 

 

By: /s/ Josh Scheinfeld                  

Name: Josh Scheinfeld

Title: President

 

 

 

    	27

    	 	

    

 

	SCHEDULES
	 	 
	Schedule 4(a)	Subsidiaries
	Schedule 4(c)	Capitalization
	Schedule 4(e)	Conflicts
	Schedule 4(f)	Exchange Act Filings
	Schedule 4(g)	Material Changes
	Schedule 4(h)	Litigation
	Schedule 4(k)	Intellectual Property
	Schedule 4(w)	Financial Advisor, Placement Agent, Broker or Finder
	 	 
	 	 
	EXHIBITS
	 	 
	Exhibit A	Form of Company Counsel Opinion
	Exhibit B	Form of Officer’s Certificate
	Exhibit C	Form of Resolutions of Board of Directors of the Company
	Exhibit D	Form of Secretary’s Certificate
	Exhibit E	Form of Letter to Transfer Agent

 

    	28

    	 	

    

 

 

DISCLOSURE SCHEDULES

 

 

Schedule 4(a) – Subsidiaries

 

 

Schedule 4(c) - Capitalization

 

 

Schedule 4(e) - No Conflicts

 

 

Schedule 4(f) - Exchange Act Filings

 

 

Schedule 4(g) - Absence of Certain Changes

 

 

Schedule 4(h) - Litigation

 

 

Schedule 4(k) - Intellectual Property Rights

 

 

Schedule 4(w) - Financial Advisor, Placement
Agent, Broker or Finder

 

 

 

    	29

    	 	

    

 

EXHIBIT A

 

FORM OF COMPANY COUNSEL OPINION

 

Capitalized terms used
herein but not defined herein, have the meaning set forth in the Purchase Agreement. Based on the foregoing, and subject to the
assumptions and qualifications set forth herein, we are of the opinion that:

 

1.The Company is
a corporation existing and in good standing under the laws of the State of Delaware. The Company is qualified to do business as
a foreign corporation and is in good standing in the States of Delaware and Massachusetts.

 

2.The Company has
the corporate power to execute and deliver, and perform its obligations under, each Transaction Document to which it is a party.
The Company has the corporate power to conduct its business as, to the best of our knowledge, it is now conducted, and to own and
use the properties owned and used by it.

 

3.The execution,
delivery and performance by the Company of the Transaction Documents to which it is a party have been duly authorized by all necessary
corporate action on the part of the Company. The execution and delivery of the Transaction Documents by the Company, the performance
of the obligations of the Company thereunder and the consummation by it of the transactions contemplated therein have been duly
authorized and approved by the Company's Board of Directors and no further consent, approval or authorization of the Company, its
Board of Directors or its stockholders is required. The Transaction Documents to which the Company is a party have been duly executed
and delivered by the Company and are the valid and binding obligations of the Company, enforceable against the Company in accordance
with their terms except as such enforceability may be limited by general principles of equity or applicable bankruptcy, insolvency,
reorganization, moratorium, liquidation or similar laws relating to, or affecting creditor’s rights and remedies.

 

4.The execution,
delivery and performance by the Company of the Transaction Documents, the consummation by the Company of the transactions contemplated
thereby including the offering, sale and issuance of the Commitment Shares and the Purchase Shares in accordance with the terms
and conditions of the Purchase Agreement, and fulfillment and compliance with terms of the Transaction Documents, does not and
shall not: (i) conflict with, constitute a breach of or default (or an event which, with the giving of notice or lapse of
time or both, constitutes or could constitute a breach or a default), under (a) the Certificate of Incorporation or the Bylaws
of the Company, (b) any material agreement, note, lease, mortgage, deed or other material instrument to which to our knowledge
the Company is a party or by which the Company or any of its assets are bound, (ii) result in any violation of any statute,
law, rule or regulation applicable to the Company, or (iii) to our knowledge, violate any order, writ, injunction or decree applicable
to the Company or any of its subsidiaries.

 

5.The issuance of
the Purchase Shares and the Commitment Shares pursuant to the terms and conditions of the Transaction Documents has been duly authorized
by all necessary corporate action on the part of the Company, provided that the Investor acknowledges that it understands that
the Company may not have sufficient authorized shares of Common Stock to allow for the issuance of all of the Securities (other
than the Commitment Shares and the Initial Purchase Shares) as of the Commencement Date. The Initial Purchase Shares and the Commitment
Shares are validly issued, fully paid and non-assessable, to our knowledge, free of all taxes, liens, charges, restrictions, rights
of first refusal and preemptive rights. 290,000,000 shares of Common Stock have been properly reserved for issuance under the Purchase
Agreement. When issued and paid for in accordance with the Purchase Agreement, the Purchase Shares shall be validly issued, fully
paid and non-assessable, to our knowledge, free of all taxes, liens, charges, restrictions, rights of first refusal and preemptive
rights. To our knowledge, the execution and delivery of the Registration Rights Agreement do not, and the performance by the Company
of its obligations thereunder shall not, give rise to any rights of any other Person for the registration under the Securities
Act of any shares of Common Stock or other securities of the Company which have not been waived.

 

    	30

    	 	

    
 

6.As of the date
hereof, the authorized capital stock of the Company consists of __,___,___ shares of common stock, par value $0.001 per share,
of which to our knowledge __________ shares are issued and outstanding. Except as set forth on Schedule 4(c) of the Purchase Agreement,
to our knowledge, there are no outstanding shares of capital stock or other securities convertible into or exchangeable or exercisable
for shares of the capital stock of the Company.

 

7.Assuming the accuracy
of the representations and your compliance with the covenants made by you in the Transaction Documents, the offering, sale and
issuance of the Commitment Shares and the Purchase Shares to you pursuant to the Transaction Documents is exempt from registration
under the Securities Act.

 

8.Other than that
which has been obtained and completed prior to the date hereof, no authorization, approval, consent, filing or other order of any
federal or state governmental body, regulatory agency, or stock exchange or market, or any court, or, to our knowledge, any third
party is required to be obtained by the Company to enter into and perform its obligations under the Transaction Documents or for
the Company to issue and sell the Commitment Shares and the Purchase Shares as contemplated by the Transaction Documents.

 

9. The Common Stock
is registered pursuant to Section 12[(b)][(g)] of the Exchange Act. To our knowledge, since one year preceding the date of the
Purchase Agreement, the Company has been in compliance with the reporting requirements of the Exchange Act applicable to it. To
our knowledge, since one year preceding the date of the Purchase Agreement, the Company has not received any written notice from
any Person stating that the Company has not been in compliance with any of the rules and regulations (including the requirements
for continued listing) of the Principal Market.

 

10. The Registration
Statement, as of the date it became effective, and the prospectus, as of its date, complied as to form in all material respects
with the requirements for registration statements on Form S-1 under the Securities Act; it being understood, however, that we express
no opinion with respect to Regulation S-T or the financial statements, schedules or other financial data included in or incorporated
by reference in or omitted from the Registration Statement or the prospectus.

 

We further advise you
that to our knowledge, except as disclosed on Schedule 4(h) in the Purchase Agreement, there is no action, suit, proceeding, inquiry
or investigation before or by any court, public board or body, any governmental agency, any stock exchange or market, or self-regulatory
organization, which has been threatened in writing or which is currently pending against the Company, any of its subsidiaries,
any officers or directors of the Company or any of its subsidiaries or any of the properties of the Company or any of its subsidiaries.

 

    	31

    	 	

    
 

In addition, we have
participated in conferences with officers and other representatives of the Company and representatives of the independent registered
public accounting firm for the Company, at which the contents of the Registration Statement and the prospectus and related matters
were discussed and, although we are not passing upon, and do not assume any responsibility for, the accuracy, completeness or fairness
of the statements contained or incorporated by reference in the Registration Statement or the prospectus, and have not made any
independent check or verification thereof, on the basis of the information that was developed in the course of the performance
of the services referred to above, considered in the light of our understanding of the applicable law, nothing came to our attention
that caused us to believe that the Registration Statement, at the time it became effective, and as of the date hereof, contained
an untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary to make the
statements therein not misleading, or that the prospectus, as of its date and as of the date hereof, contained an untrue statement
of a material fact or omitted to state a material fact necessary to make the statements therein, in light of the circumstances
under which they were made, not misleading; it being understood that we express no belief with respect to the financial statements,
the notes and schedules thereto, other financial data, or exhibits included in, incorporated by reference in, or omitted from,
the Registration Statement or the prospectus.

 

    	32

    	 	

    
 

EXHIBIT B

 

FORM OF OFFICER’S CERTIFICATE

 

This Officer’s
Certificate (“Certificate”) is being delivered pursuant to Section 8(e) of that certain Purchase Agreement dated
as of September 19, 2012, (“Purchase Agreement”), by and between ADVANCED CELL TECHNOLOGY, INC., a Delaware
corporation (the “Company”), and LINCOLN PARK CAPITAL FUND, LLC (the “Investor”).
Terms used herein and not otherwise defined shall have the meanings ascribed to them in the Purchase Agreement.

 

The undersigned, ___________,
______________ of the Company, hereby certifies as follows:

 

1.I
am the _____________ of the Company and make the statements contained in this Certificate;

 

2.The representations
and warranties of the Company are true and correct in all material respects (except to the extent that any of such representations
and warranties is already qualified as to materiality in Section 4 of the Purchase Agreement, in which case, such representations
and warranties are true and correct without further qualification) as of the date when made and as of the Commencement Date as
though made at that time (except for representations and warranties that speak as of a specific date, in which case such representations
and warranties are true and correct as of such date);

 

3.The Company
has performed, satisfied and complied in all material respects with covenants, agreements and conditions required by the Transaction
Documents to be performed, satisfied or complied with by the Company at or prior to the Commencement Date.

 

4. The
Company has not taken any steps, and does not currently expect to take any steps, to seek protection pursuant to any Bankruptcy
Law nor does the Company or any of its Subsidiaries have any knowledge or reason to believe that its creditors intend to initiate
involuntary bankruptcy or insolvency proceedings. The Company is financially solvent and is generally able to pay its debts as
they become due.

 

IN WITNESS WHEREOF,
I have hereunder signed my name on this ___ day of ___________.

 

______________________

Name:

Title:

 

The undersigned as
Secretary of ADVANCED CELL TECHNOLOGY, INC., a Delaware corporation, hereby certifies that ___________ is the duly elected,
appointed, qualified and acting ________ of _________ and that the signature appearing above is his genuine signature.

 

___________________________________

Secretary

 

    	33

    	 	

    
 

EXHIBIT C

 

FORM OF COMPANY RESOLUTIONS

FOR SIGNING PURCHASE AGREEMENT

 

UNANIMOUS WRITTEN CONSENT OF

ADVANCED CELL TECHNOLOGY, INC.

 

In accordance with
the corporate laws of the state of Delaware, the undersigned, being all of the directors of ADVANCED CELL TECHNOLOGY, INC.,
a Delaware corporation (the “Corporation”) do hereby consent to and adopt the following resolutions as the action of
the Board of Directors for and on behalf of the Corporation and hereby direct that this Consent be filed with the minutes of the
proceedings of the Board of Directors:

 

WHEREAS, there has
been presented to the Board of Directors of the Corporation a draft of the Purchase Agreement (the “Purchase Agreement”)
by and between the Corporation and Lincoln Park Capital Fund, LLC (“Lincoln Park”), providing for the purchase by Lincoln
Park of up to Thirty Five Million Dollars ($35,000,000) of the Corporation’s common stock, $0.001 par value per share (the
“Common Stock”); and

 

WHEREAS, after careful
consideration of the Purchase Agreement, the documents incident thereto and other factors deemed relevant by the Board of Directors,
the Board of Directors has determined that it is advisable and in the best interests of the Corporation to engage in the transactions
contemplated by the Purchase Agreement, including, but not limited to, the issuance of 8,750,000 shares of Common Stock to Lincoln
Park as a commitment fee (the “Commitment Shares”) and the sale of shares of Common Stock to Lincoln Park up to the
available amount under the Purchase Agreement (the "Purchase Shares").

 

Transaction Documents

 

NOW, THEREFORE, BE
IT RESOLVED, that the transactions described in the Purchase Agreement are hereby approved and ________________________________________
(the “Authorized Officers”) are severally authorized to execute and deliver the Purchase Agreement, and any other agreements
or documents contemplated thereby including, without limitation, a registration rights agreement (the “Registration Rights
Agreement”) providing for the registration of the shares of the Company’s Common Stock issuable in respect of the Purchase
Agreement on behalf of the Corporation, with such amendments, changes, additions and deletions as the Authorized Officers may deem
to be appropriate and approve on behalf of, the Corporation, such approval to be conclusively evidenced by the signature of an
Authorized Officer thereon; and

 

FURTHER RESOLVED, that
the terms and provisions of the Registration Rights Agreement by and among the Corporation and Lincoln Park are hereby approved
and the Authorized Officers are authorized to execute and deliver the Registration Rights Agreement (pursuant to the terms of the
Purchase Agreement), with such amendments, changes, additions and deletions as the Authorized Officer may deem appropriate and
approve on behalf of, the Corporation, such approval to be conclusively evidenced by the signature of an Authorized Officer thereon;
and

 

FURTHER RESOLVED, that
the terms and provisions of the forms of Initial Irrevocable Transfer Agent Instructions, Commencement Irrevocable Transfer Agent
Instructions and Notice of Effectiveness of Registration Statement (collectively, the “Instructions”) are hereby approved
and the Authorized Officers are authorized to execute and deliver the Instructions on behalf of the Company in accordance with
the Purchase Agreement, with such amendments, changes, additions and deletions as the Authorized Officers may deem appropriate
and approve on behalf of, the Corporation, such approval to be conclusively evidenced by the signature of an Authorized Officer
thereon; and

 

    	34

    	 	

    
 

Execution of Purchase
Agreement

 

FURTHER RESOLVED, that
the Corporation be and it hereby is authorized to execute the Purchase Agreement providing for the purchase of up to Thirty Five
Million Dollars ($35,000,000) of the Corporation’s common stock; and

 

Issuance of Common
Stock

 

FURTHER RESOLVED, that
the Corporation is hereby authorized to issue to Lincoln Park Capital Fund, LLC, 8,750,000 shares of Common Stock as Commitment
Shares and that upon issuance of the Commitment Shares pursuant to the Purchase Agreement the Commitment Shares shall be duly authorized,
validly issued, fully paid and nonassessable with no personal liability attaching to the ownership thereof; and

 

FURTHER RESOLVED, that
the Corporation is hereby authorized to issue to Lincoln Park Capital Fund, LLC, 10,000,000 shares of Common Stock as Initial Purchase
Shares and that upon issuance of the Initial Purchase Shares pursuant to the Purchase Agreement the Initial Purchase Shares shall
be duly authorized, validly issued, fully paid and nonassessable with no personal liability attaching to the ownership thereof;
and

 

FURTHER RESOLVED, that
the Corporation is hereby authorized to issue shares of Common Stock upon the purchase of Purchase Shares up to the Available Amount
under the Purchase Agreement in accordance with the terms of the Purchase Agreement and that, upon issuance of the Purchase Shares
pursuant to the Purchase Agreement, the Purchase Shares will be duly authorized, validly issued, fully paid and nonassessable with
no personal liability attaching to the ownership thereof; and

 

FURTHER
RESOLVED, that the Corporation shall initially reserve 290,000,000 shares of Common Stock for issuance as Purchase Shares under
the Purchase Agreement.

 

Approval of Actions

 

FURTHER RESOLVED, that,
without limiting the foregoing, the Authorized Officers are, and each of them hereby is, authorized and directed to proceed on
behalf of the Corporation and to take all such steps as deemed necessary or appropriate, with the advice and assistance of counsel,
to cause the Corporation to consummate the agreements referred to herein and to perform its obligations under such agreements;
and

 

FURTHER RESOLVED, that
the Authorized Officers be, and each of them hereby is, authorized, empowered and directed on behalf of and in the name of the
Corporation, to take or cause to be taken all such further actions and to execute and deliver or cause to be executed and delivered
all such further agreements, amendments, documents, certificates, reports, schedules, applications, notices, letters and undertakings
and to incur and pay all such fees and expenses as in their judgment shall be necessary, proper or desirable to carry into effect
the purpose and intent of any and all of the foregoing resolutions, and that all actions heretofore taken by any officer or director
of the Corporation in connection with the transactions contemplated by the agreements described herein are hereby approved, ratified
and confirmed in all respects.

 

    	35

    	 	

    
 

IN WITNESS WHEREOF, the Board of Directors
has executed and delivered this Consent effective as of __________, 2012.

 

 

 

______________________

 

______________________

 

______________________

 

 

 

 

being all of the directors of ADVANCED CELL TECHNOLOGY, INC.

 

    	36

    	 	

    
 

EXHIBIT D

 

FORM OF SECRETARY’S CERTIFICATE

 

This Secretary’s
Certificate (“Certificate”) is being delivered pursuant to Section 7(k) of that certain Purchase Agreement dated as
of September 19, 2012(“Purchase Agreement”), by and between ADVANCED CELL TECHNOLOGY, INC., a Delaware corporation
(the “Company”) and LINCOLN PARK CAPITAL FUND, LLC (the “Investor”), pursuant to which the Company
may sell to the Investor up to Thirty Five Million Dollars ($35,000,000) of the Company's Common Stock, $0.001 par value per share
(the "Common Stock"). Terms used herein and not otherwise defined shall have the meanings ascribed to them in the Purchase
Agreement.

 

The undersigned, ____________, Secretary
of the Company, hereby certifies as follows:

 

1.I am the
Secretary of the Company and make the statements contained in this Secretary’s Certificate.

 

2.Attached
hereto as Exhibit A and Exhibit B are true, correct and complete copies of the Company’s bylaws (“Bylaws”)
and Certificate of Incorporation (“Charter”), in each case, as amended through the date hereof, and no action has been
taken by the Company, its directors, officers or stockholders, in contemplation of the filing of any further amendment relating
to or affecting the Bylaws or Charter.

 

3.Attached
hereto as Exhibit C are true, correct and complete copies of the resolutions duly adopted by the Board of Directors of the
Company on _____________, at which a quorum was present and acting throughout. Such resolutions have not been amended, modified
or rescinded and remain in full force and effect and such resolutions are the only resolutions adopted by the Company’s Board
of Directors, or any committee thereof, or the stockholders of the Company relating to or affecting (i) the entering into and performance
of the Purchase Agreement, or the issuance, offering and sale of the Purchase Shares and the Commitment Shares and (ii) and the
performance of the Company of its obligation under the Transaction Documents as contemplated therein.

 

4.As
of the date hereof, the authorized, issued and reserved capital stock of the Company is as set forth on Exhibit D hereto.

 

IN WITNESS WHEREOF,
I have hereunder signed my name on this ___ day of ____________.

 

_________________________

Secretary

 

 

The undersigned as ___________ of ADVANCED
CELL TECHNOLOGY, INC., a Delaware corporation, hereby certifies that ____________ is the duly elected, appointed, qualified
and acting Secretary of _________, and that the signature appearing above is his genuine signature.

 

___________________________________

 

    	37

    	 	

    
 

EXHIBIT E

 

FORM OF LETTER TO THE TRANSFER AGENT
FOR THE ISSUANCE OF THE INITIAL PURCHASE SHARES AND THE COMMITMENTS SHARES AT SIGNING OF THE PURCHASE AGREEMENT

 

 

 

[COMPANY LETTERHEAD]

 

 

 

[DATE]

 

[TRANSFER AGENT]

__________________

__________________

__________________

 

Re: Issuance of Common Shares to Lincoln Park Capital Fund,
LLC

 

Dear ________,

 

On behalf of ADVANCED CELL TECHNOLOGY, INC., (the “Company”),
you are hereby instructed to issue as soon as possible a share certificate representing an aggregate of 18,750,000
shares of our common stock (consisting of 10,000,000 Initial Purchase Shares and 8,750,000 Commitment Shares) in the name of Lincoln
Park Capital Fund, LLC. The share certificate should be dated September 19, 2012. I have included a true and correct copy
of a unanimous written consent executed by all of the members of the Board of Directors of the Company adopting resolutions approving
the issuance of these shares. The share certificate should bear the following restrictive legend:

 

THE SECURITIES REPRESENTED BY THIS
CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE STATE SECURITIES LAWS. THE SECURITIES
HAVE BEEN ACQUIRED FOR INVESTMENT AND MAY NOT BE OFFERED FOR SALE, SOLD, TRANSFERRED OR ASSIGNED IN THE ABSENCE OF AN EFFECTIVE
REGISTRATION STATEMENT FOR THE SECURITIES UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE STATE SECURITIES LAWS, UNLESS
SOLD PURSUANT TO: (1) RULE 144 UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR (2) AN OPINION OF HOLDER’S COUNSEL, IN A
CUSTOMARY FORM, THAT REGISTRATION IS NOT REQUIRED UNDER SAID ACT OR APPLICABLE STATE SECURITIES LAWS.

 

    	38

    	 	

    
 

The share certificate should be sent as soon as possible
via overnight mail to the following address:

 

Lincoln Park Capital Fund, LLC

440 North Wells, Suite 620

Chicago, IL 60654

Attention: Josh Scheinfeld/Jonathan
Cope

 

Thank you very much for your help. Please call me at ______________
if you have any questions or need anything further.

 

ADVANCED CELL TECHNOLOGY, INC.

 

BY:_____________________________

[name]

[title]

 

 

    	39

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