Document:

Blueprint

 

 

EXHIBIT 10.1

 

SECURITIES
PURCHASE AGREEMENT

 

This Securities Purchase Agreement
(this “Agreement”) is dated as
of December 19, 2017, between CEL-SCI Corporation, a Colorado
corporation (the “Company”), and each
purchaser identified on the signature pages hereto (each, including
its successors and assigns, a “Purchaser” and
collectively the “Purchasers”).

 

WHEREAS, subject to
the terms and conditions set forth in this Agreement and pursuant
an exemption from the registration requirements of Section 5 of the
Securities Act contained in Section 4(a)(2) thereof and/or
Regulation D thereunder as to the Shares and Warrants, the Company
desires to issue and sell to each Purchaser, and each Purchaser,
severally and not jointly, desires to purchase from the Company,
Shares and Warrants of the Company as more fully described in this
Agreement.

 

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

 

ARTICLE I.

DEFINITIONS

 

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

 

                       

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

 

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

 

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

 

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

 

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

 

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

 

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

 

 

1

 

 

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

 

“Common Stock” means the
common stock of the Company, par value $0.01 per share, and any
other class of securities into which such securities may hereafter
be reclassified or changed.

 

“Company Counsel” means
Hart & Hart, LLC.

 

“Disclosure Schedules”
means the Disclosure Schedules of the Company delivered
concurrently herewith.

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

“Purchase Price” means
$1.90 for
one Share and one Warrant.

 

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

 

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

 

 

2

 

 

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

 

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

 

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

 

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

 

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

 

“Securities” means the
Shares, the Warrants and the Warrant Shares.

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

 

3

 

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

 

“Transfer Agent” means
Computershare Trust Company, the current transfer agent of the
Company, and any successor transfer agent of the
Company.

 

“Warrants” means
collectively, the Series
SS warrants
delivered to the Purchasers at the Closing in accordance with
Section 2.2(a) hereof, which Warrants shall be exercisable
commencing 6 months after the date of issuance and have a term of
exercise equal to 5 years, in the form of Exhibit A-1, attached
hereto.

 

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

 

ARTICLE II.

PURCHASE
AND SALE

 

2.1 Closing.
On the Closing Date, upon the terms and subject to the conditions
set forth herein, substantially concurrent with the execution and
delivery of this Agreement by the parties hereto, the Company
agrees to sell, and the Purchasers, severally and not jointly,
agree to purchase, up to an aggregate of approximately
$_________ of Shares and
Warrants. The purchase price for one Share and Warrant will be
$1.90. Each Purchaser’s Subscription Amount as set forth on
the signature page hereto executed by such Purchaser shall be made
available for “Delivery Versus Payment” settlement with
the Company. The Company shall deliver to each Purchaser its
respective Shares and a Warrant as determined pursuant to Section
2.2(a), and the Company and each Purchaser shall deliver the other
items set forth in Section 2.2 deliverable at the Closing. Upon
satisfaction of the covenants and conditions set forth in Sections
2.2 and 2.3, the Closing shall occur at the offices of Company
Counsel or such other location as the parties shall mutually
agree.

 

2.2 Deliveries.

 

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

 

(i) this Agreement duly
executed by the Company;

 

(ii) Shares,
in the number as shown on the signature pages to this
Agreement.

 

(iii) Series
SS Warrants registered in the name of such Purchaser to purchase up
to a number of shares of Common Stock equal to 100% of such
Purchaser’s Shares, with an exercise price equal to
$2.09,
subject to adjustment therein.

 

 

4

 

 

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

 

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

 

(ii) such
Purchaser’s Subscription Amount.

 

2.3 Closing
Conditions.

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

 

5

 

 

ARTICLE III.

REPRESENTATIONS
AND WARRANTIES

 

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

 

(a)            Subsidiaries.
All of the direct and indirect subsidiaries of the Company are as
disclosed in the SEC Reports. Except as set forth in the SEC
Reports, the Company owns, directly or indirectly, all of the
capital stock or other equity interests of each Subsidiary free and
clear of any Liens, and all of the issued and outstanding shares of
capital stock of each Subsidiary are validly issued and are fully
paid, non-assessable and free of preemptive and similar rights to
subscribe for or purchase securities.

 

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

 

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

 

 

6

 

 

 

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

 

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

 

 

 

 

7

 

 

 

(f) Issuance of the Securities. The
Securities are duly authorized and, when issued and paid for in
accordance with the applicable Transaction Documents, will be duly
and validly issued, fully paid and nonassessable, free and clear of
all Liens imposed by the Company. The Warrant Shares, when issued
in accordance with the terms of the Warrants, will be validly
issued, fully paid and nonassessable, free and clear of all Liens
imposed by the Company. The Company has reserved from its duly
authorized capital stock the maximum number of shares of Common
Stock issuable pursuant to the Warrants.

 

(g) SEC Reports; Financial
Statements. The Company has filed all reports, schedules,
forms, statements and other documents required to be filed by the
Company under the Securities Act and the Exchange Act, including
pursuant to Section 13(a) or 15(d) thereof, for the two years
preceding the date hereof (or such shorter period as the Company
was required by law or regulation to file such material) (the
foregoing materials, including the exhibits thereto and documents
incorporated by reference therein, being collectively referred to
herein as the “SEC
Reports”) on a timely basis or has received a valid
extension of such time of filing and has filed any such SEC Reports
prior to the expiration of any such extension. As of their
respective dates, the SEC Reports complied in all material respects
with the requirements of the Securities Act and the Exchange Act,
as applicable, and none of the SEC Reports, when filed, contained
any untrue statement of a material fact or omitted to state a
material fact required to be stated therein or necessary in order
to make the statements therein, in the light of the circumstances
under which they were made, not misleading. The Company has never
been an issuer subject to Rule 144(i) under the Securities Act. The
financial statements of the Company included in the SEC Reports
comply in all material respects with applicable accounting
requirements and the rules and regulations of the Commission with
respect thereto as in effect at the time of filing. Such financial
statements have been prepared in accordance with United States
generally accepted accounting principles applied on a consistent
basis during the periods involved (“GAAP”), except as may be
otherwise specified in such financial statements or the notes
thereto and except that unaudited financial statements may not
contain all footnotes required by GAAP, and fairly present in all
material respects the financial position of the Company and its
consolidated Subsidiaries as of and for the dates thereof and the
results of operations and cash flows for the periods then ended,
subject, in the case of unaudited statements, to normal,
immaterial, year-end audit adjustments.

 

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

 

 

8

 

 

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

 

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

 

(k) Accountants. The
Company’s accounting firm is BDO USA, LLP. To the knowledge
and belief of the Company, such accounting firm (i) is a registered
public accounting firm as required by the Exchange Act and (ii)
shall express its opinion with respect to the financial statements
to be included in the Company’s Annual Report for the fiscal
year ending September 30, 2017.

 

 

9

 

 

 

(l) FDA. As to each product subject
to the jurisdiction of the U.S. Food and Drug Administration
(“FDA”)
under the Federal Food, Drug and Cosmetic Act, as amended, and the
regulations thereunder (“FDCA”) that is
manufactured, packaged, labeled, tested, distributed, sold, and/or
marketed by the Company or any of its Subsidiaries (each such
product, a “Pharmaceutical Product”),
such Pharmaceutical Product is being manufactured, packaged,
labeled, tested, distributed, sold and/or marketed by the Company
in compliance with all applicable requirements under FDCA and
similar laws, rules and regulations relating to registration,
investigational use, premarket clearance, licensure, or application
approval, good manufacturing practices, good laboratory practices,
good clinical practices, product listing, quotas, labeling,
advertising, record keeping and filing of reports, except where the
failure to be in compliance would not have a Material Adverse
Effect. Except as disclosed in Schedule 3.1(l), there is no
pending, completed or, to the Company's knowledge, threatened,
action (including any lawsuit, arbitration, or legal or
administrative or regulatory proceeding, charge, complaint, or
investigation) against the Company or any of its Subsidiaries, and
none of the Company or any of its Subsidiaries has received any
notice, warning letter or other communication from the FDA or any
other governmental entity, which (i) contests the premarket
clearance, licensure, registration, or approval of, the uses of,
the distribution of, the manufacturing or packaging of, the testing
of, the sale of, or the labeling and promotion of any
Pharmaceutical Product, (ii) withdraws its approval of, requests
the recall, suspension, or seizure of, or withdraws or orders the
withdrawal of advertising or sales promotional materials relating
to, any Pharmaceutical Product, (iii) imposes a clinical hold on
any clinical investigation by the Company or any of its
Subsidiaries, (iv) enjoins production at any facility of the
Company or any of its Subsidiaries, (v) enters or proposes to enter
into a consent decree of permanent injunction with the Company or
any of its Subsidiaries, or (vi) otherwise alleges any violation of
any laws, rules or regulations by the Company or any of its
Subsidiaries, and which, either individually or in the aggregate,
would have a Material Adverse Effect. The properties, business and
operations of the Company have been and are being conducted in all
material respects in accordance with all applicable laws, rules and
regulations of the FDA. The Company has not been informed by the
FDA that the FDA will prohibit the marketing, sale, license or use
in the United States of any product proposed to be developed,
produced or marketed by the Company nor has the FDA expressed any
concern as to approving or clearing for marketing any product being
developed or proposed to be developed by the Company. 

 

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

 

(n) No Disqualification Events.
With respect to the Warrant and Warrant Shares to be offered and
sold hereunder in reliance on Rule 506 under the Securities Act,
none of the Company, any of its predecessors, any affiliated
issuer, any director, executive officer, other officer of the
Company participating in the offering hereunder, any beneficial
owner of 20% or more of the
Company’s outstanding voting equity securities, calculated on
the basis of voting power, nor any promoter (as that term is
defined in Rule 405 under the Securities Act) connected with the
Company in any capacity at the time of sale (each, an "Issuer
Covered Person") is subject to any of the "Bad Actor"
disqualifications described in Rule 506(d)(1)(i) to (viii) under
the Securities Act (a "Disqualification Event"), except for a
Disqualification Event covered by Rule 506(d)(2) or (d)(3). The
Company has exercised reasonable care to determine whether any
Issuer Covered Person is subject to a Disqualification Event. The
Company has complied, to the extent applicable, with its disclosure
obligations under Rule 506(e), and has furnished to the Purchasers
a copy of any disclosures provided thereunder.

 

 

 

10

 

 

(o) Notice of Disqualification
Events. The Company will notify the Purchasers in writing,
prior to the Closing Date of (i) any Disqualification Event
relating to any Issuer Covered Person and (ii) any event that
would, with the passage of time, reasonably be expected to become a
Disqualification Event relating to any Issuer Covered Person, in
each case of which it is aware.

 

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

 

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

 

(b)             Restricted
Securities. Such Purchaser
understands that the Warrants and the Warrant Shares are
“restricted securities” and have not been registered
under the Securities Act or any applicable state securities
law.

 

(c)                 Purchaser
Status. At the time such
Purchaser was offered the Securities, it was, and as of the date
hereof it is, and on each date on which it exercises any Warrants,
itwill
be either: (i) an “accredited investor” as defined in
Rule 501(a)(1), (a)(2), (a)(3), (a)(7) or (a)(8) under the
Securities Act or (ii) a “qualified institutional
buyer” as defined in Rule 144A(a) under the Securities
Act.

 

 

11

 

 

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

 

(e)            Access
to Information. Such Purchaser
acknowledges that it has had the opportunity to review the
Transaction Documents (including all exhibits and schedules
thereto) and the SEC Reports and has been afforded, (i) the
opportunity to ask such questions as it has deemed necessary of,
and to receive answers from, representatives of the Company
concerning the terms and conditions of the offering of the
Securities and the merits and risks of investing in the Securities;
(ii) access to information about the Company and its financial
condition, results of operations, business, properties, management
and prospects sufficient to enable it to evaluate its investment;
and (iii) the opportunity to obtain such additional information
that the Company possesses or can acquire without unreasonable
effort or expense that is necessary to make an informed investment
decision with respect to the investment.

 

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

 

 

12

 

 

 

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

 

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

 

ARTICLE IV.

OTHER
AGREEMENTS OF THE PARTIES

 

4.1 Removal
of Legends.

 

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

 

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

 

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

 

 

13

 

 

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

 

(e) Certificates
evidencing the Shares and Warrant Shares shall not contain any
legend (including the legend set forth in Section 4.1(b) hereof):
(i) while a registration statement covering the resale of such
security is effective under the Securities Act, or (ii) following
any sale of such Shares and Warrant Shares pursuant to Rule 144, or
(iii) if such Warrant Shares are eligible for sale under Rule 144,
or (iv) if such legend is not required under applicable
requirements of the Securities Act (including judicial
interpretations and pronouncements issued by the staff of the
Commission). The Company shall cause its counsel to issue a legal
opinion to the Transfer Agent promptly if required by the Transfer
Agent to effect the removal of the legend hereunder if all or any
portion of a Warrant is exercised at a time when there is an
effective registration statement to cover the resale of the Warrant
Shares, or if such Shares and Warrant Shares may be sold under Rule
144 or if such legend is not otherwise required under applicable
requirements of the Securities Act (including judicial
interpretations and pronouncements issued by the staff of the
Commission).

 

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

 

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

 

 

 

14

 

 

4.4 Securities
Laws Disclosure; Publicity. The
Company shall (file a Current Report on Form 8-K, including the
Transaction Documents as exhibits thereto, with the Commission
within the time required by the Exchange Act.

 

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

 

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

 

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

 

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

 

 

15

 

 

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

 

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

 

 

16

 

 

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

 

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

 

 

17

 

 

4.13 Registration
Statement. Promptly after the
Closing, the Company will file a registration statement with the
Securities and Exchange Commission to register the Shares and
Warrant Shares.

 

ARTICLE V.

MISCELLANEOUS

 

5.1 Termination.
This Agreement may be terminated by any Purchaser, as to such
Purchaser’s obligations hereunder only and without any effect
whatsoever on the obligations between the Company and the other
Purchasers, by written notice to the other parties, if the Closing
has not been consummated on or before December 29, 2017;
provided,
however,
that no such termination will affect the right of any party to sue
for any breach by any other party (or parties).

 

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

 

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

 

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

 

 

18

 

 

5.5 Amendments;
Waivers. No provision of this
Agreement may be waived, modified, supplemented or amended except
in a written instrument signed, in the case of an amendment, by the
Company and Purchasers which purchased at least 67% in interest of
the Shares based on the initial Subscription Amounts hereunder or,
in the case of a waiver, by the party against whom enforcement of
any such waived provision is sought; provided, that if any
amendment, modification or waiver disproportionately and adversely
impacts a Purchaser (or group of Purchasers), the consent of such
disproportionately impacted Purchaser (or group of Purchasers)
shall also be required. No waiver of any default with respect to
any provision, condition or requirement of this Agreement shall be
deemed to be a continuing waiver in the future or a waiver of any
subsequent default or a waiver of any other provision, condition or
requirement hereof, nor shall any delay or omission of any party to
exercise any right hereunder in any manner impair the exercise of
any such right. Any proposed amendment or waiver that
disproportionately, materially and adversely affects the rights and
obligations of any Purchaser relative to the comparable rights and
obligations of the other Purchasers shall require the prior written
consent of such adversely affected Purchaser, Any amendment
effected in accordance with accordance with this Section 5.5 shall
be binding upon each Purchaser and holder of Securities and the
Company.

 

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

 

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

 

5.8 No
Third-Party Beneficiaries. This
Agreement is intended for the benefit of the parties hereto and
their respective successors and permitted assigns and is not for
the benefit of, nor may any provision hereof be enforced by, any
other Person, except as otherwise set forth in Section 4.8 and this
Section 5.8.

 

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

 

 

19

 

 

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

 

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

 

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

 

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

 

 

20

 

 

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

 

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

 

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

 

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

 

 

21

 

 

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

 

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

 

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

 

 

 

(Signature Pages Follow)

 

 

 

22

 

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

 

	

CEL-SCI CORPORATION 

	
 

	
Address for
Notice:

	
 

	
 

	
 

	
 

	
By:

	
 

	
 

	
E-Mail:
grkersten@cel-sci.com

	
 

	
 Name: Geert R.
Kersten

	
 

	
Fax:
(703)
506-9471

	
 

	
 Title:
CEO

	
 

	
 

 

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

	

William
T. Hart

Hart
& Hart, LLC

1624
Washington St.

Denver,
CO 80203

(303)
839-0061

harttrinen@aol.com

	
 

 

 

 

 

 

[REMAINDER
OF PAGE INTENTIONALLY LEFT BLANK

SIGNATURE
PAGE FOR PURCHASER FOLLOWS]

 

 

 

23

 

[PURCHASER
SIGNATURE PAGES TO CVM SECURITIES PURCHASE AGREEMENT]

 

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

 

Name of
Purchaser:
________________________________________________________

Signature of Authorized Signatory of
Purchaser: _________________________________

Name of
Authorized Signatory:
_______________________________________________

Title
of Authorized Signatory:
________________________________________________

Email
Address of Authorized
Signatory:_________________________________________

Facsimile Number of
Authorized Signatory:
__________________________________________

Address
for Notice to Purchaser:

 

 

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

 

 

Subscription
Amount: $_________________

 

Shares:
_________________

 

Warrant
Shares: __________________

 

EIN
Number: _______________________

 

 

[SIGNATURE
PAGES CONTINUE]

 

 

 

24

 

List of Schedules

 

Schedule 3.1(i):

 

●

The Company is
currently involved in a pending arbitration proceeding, CEL-SCI
Corporation v. inVentiv Health Clinical, LLC (f/k/a PharmaNet LLC)
and PharmaNet GmbH (f/k/a PharmaNet AG). The Company initiated the
proceedings against inVentiv Health Clinical, LLC, or inVentiv, the
former third-party CRO, and are seeking payment for damages related
to inVentiv’s prior involvement in the Phase 3 clinical trial
of Multikine. The arbitration claim, initiated under the Commercial
Rules of the American Arbitration Association, alleges (i) breach
of contract, (ii) fraud in the inducement, and (iii) common law
fraud. Currently, the Company is seeking at least $50 million in
damages in its amended statement of claim.

 

In an
amended statement of claim, the Company asserted the claims set
forth above as well as an additional claim for professional
malpractice. The arbitrator subsequently granted inVentiv’s
motion to dismiss the professional malpractice claim based on the
“economic loss doctrine” which, under New Jersey law,
is a legal doctrine that, under certain circumstances, prohibits
bringing a negligence-based claim alongside a claim for breach of
contract. The arbitrator denied the remainder of inVentiv’s
motion, which had sought to dismiss certain other aspects of the
amended statement of claim. In particular, the arbitrator rejected
inVentiv’s argument that several aspects of the amended
statement of claim were beyond the arbitrator’s
jurisdiction.

 

In
connection with the pending arbitration proceedings, inVentiv has
asserted counterclaims against the Company for (i) breach of
contract, seeking at least $2 million in damages for services
allegedly performed by inVentiv; (ii) breach of contract, seeking
at least $1 million in damages for the alleged use of
inVentiv’s name in connection with publications and
promotions in violation of the parties’ contract; (iii)
opportunistic breach, restitution and unjust enrichment, seeking at
least $20 million in disgorgement of alleged unjust profits
allegedly made by the Company as a result of the purported breaches
referenced in subsection (ii); and (iv) defamation, seeking at
least $1 million in damages for allegedly defamatory statements
made about inVentiv. The Company believes inVentiv’s
counterclaims are meritless and intends to vigorously defend
against them. However, if such defense is unsuccessful, and
inVentiv successfully asserts any of its counterclaims, such an
adverse determination could have a material adverse effect on the
Company’s business, results, financial condition and
liquidity.

 

 

25

 

 

In
October 2015 the Company signed an arbitration funding agreement
with a company established by Lake Whillans Litigation Finance,
LLC, a firm specializing in funding litigation expenses. Pursuant
to the agreement, an affiliate of Lake Whillans provides the
Company with up to $5 million in funding for litigation expenses to
support its arbitration claims against inVentiv. The funding is
available to the Company to fund the expenses of the ongoing
arbitration and will only be repaid if the Company receives
proceeds from the arbitration. During the three months ended
December 31, 2015, the Company recognized a gain of approximately
$1.1 million on the derecognition of legal fees to record the
transfer of the liability that existed prior to the execution of
the financing agreement from the Company to Lake Whillans. The gain
on derecognition of legal fees is recorded as a reduction of
general and administration expenses on the Statement of Operations.
All related legal fees are directly billed to and paid by Lake
Whillans. As part of the agreement with Lake Whillans, the law firm
agreed to cap its fees and expenses for the arbitration at $5
million.

 

On
November 13, 2017, CEL-SCI announced that the last witness in the
arbitration hearing testified on November 8, 2017, and no further
witnesses or testimony are expected. With that final witness, the
testimony phase of the arbitration concluded. All that remains at
the trial level are closing statements and post-trial
submissions.

 

Schedule 3.1(l):

 

●

On September 26,
2016, we received verbal notice from FDA that the Phase 3 clinical
trial in advanced primary head and neck cancer has been placed on
partial clinical hold. On August 14, 2017, the Company announced it
has received a letter from the U.S. Food and Drug Administration
stating that the clinical hold that had been imposed on the
Company’s Phase 3 cancer study with Multikine has been
removed and that all clinical trial activities under this IND
application may resume.

 

 

26

 

CEL-SCI CORPORATION

 

SECURITIES PURCHASE AGREEMENT

 

 

1.         

Subscription. I hereby agree to
purchase _______ shares of the Company’s common stock
pursuant to the terms and conditions of this Agreement at a price
of $1.90 per share for
a total investment of $_________.

 

For
each share purchased I will receive one warrant. Each warrant will
entitle the holder to purchase one share of the Company’s
common stock at any time on or before December 18, 2022 at a price
of $2.09 per
share.

 

The
shares of common stock and warrants are sometimes referred to in
this Agreement as the “Securities”.

 

This
Agreement must be signed and delivered to the Company on or before
December 19, 2017 by 6:00 PM ET.

 

2.           

Representations and Warranties.
I warrant and represent to the Company that:

 

a. I
have had the opportunity to review the Company’s filings with
the Securities and Exchange Commission.

 

b. I (and my
purchaser representative, if any) have had an opportunity to ask
questions of, and receive answers from the officers of the Company
concerning the Company’s business and affairs.

 

c. I understand
that prices for the Company’s common stock on the NYSE
American have been volatile in the past.

 

d. By virtue of my
net worth and by reason of my knowledge and experience in financial
and business matters in general, and investments in particular, I
am capable of evaluating the merits and risks of an investment in
the Securities.

 

e. I am capable of
bearing the economic risks of an investment in the
Securities.

 

3.         

Payment/Closing. Payment for
the Securities must be made by wire transfer on or before December
21, 2017. The Securities will be delivered upon the approval of the
issuance of the Securities by the NYSE American which is not
expected to take longer than December 21, 2017. CEL-SCI offers the
option to deliver actual stock certificates or, which will be much
easier for the investor, to have the securities placed in book
format at Computershare, the largest transfer agent in the world.
Once the securities are free trading, they can easily be
transferred to any brokerage account. The warrant certificates will
be mailed to the investor.

 

 

 

27

 

4.         

Applicable Law/Arbitration.
This Agreement shall be governed in all respects by the laws of
Colorado, without regard to the choice of law provision thereof.
Any claim, controversy or dispute with respect to this Agreement or
the Securities will be settled by means of binding arbitration in
Vienna, Virginia pursuant to the Commercial Rules of the American
Arbitration Association. In any litigation, arbitration, or court
proceeding between the Company and the Subscriber relating to this
Agreement, the prevailing party shall be entitled to reasonable
attorneys’ fees and expenses incurred.

 

IN
WITNESS WHEREOF, I have executed this Agreement this 19th day of
December, 2017.

 

	
 

	
 

	
 

	
 ___________________________

	
 

	
 

	
 

	
 Signature of
Subscriber

 

ACCEPTED:

 

CEL-SCI CORPORATION

 

	
By:

	
 

	
 

	
______________________________

	
 

	
 Geert
Kersten

	
 

	
Name of
Subscriber

	
 

	
 

	
 

	
(Type or
print)

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
Dated:

	
 

	
 

	
Address of
Subscriber:

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
______________________________

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 ______________________________

 

 

 

 

 

28Exhibit 4.1

 

NUMBER UNITS

U-

 

SEE REVERSE FOR CERTAIN

DEFINITIONS

CUSIP [●]

 

ONE MADISON CORPORATION

 

UNITS CONSISTING OF ONE CLASS A ORDINARY
SHARE

AND ONE-HALF OF ONE WARRANT, EACH WHOLE WARRANT ENTITLING THE HOLDER TO PURCHASE ONE CLASS A

ORDINARY SHARE

 

THIS CERTIFIES THAT __________________ is the
owner of _______ Units.

 

Each Unit (“Unit”) consists
of one (1) Class A Ordinary Share, par value $0.0001 per share (“Ordinary Share”), of One Madison Corporation,
a Cayman Islands exempted company (the “Company”), and one-half of one warrant (the “Warrant”).
Each whole warrant entitles the holder to purchase one Ordinary Share for $11.50 per share (subject to adjustment). Each Warrant
will become exercisable on the later of (i) thirty (30) days after the Company’s completion of a merger, share exchange,
asset acquisition, share purchase, reorganization or other similar business combination with one or more businesses (each a “Business
Combination”), or (ii) twelve (12) months from the closing of the Company’s initial public offering, and will
expire unless exercised before 5:00 p.m., New York City Time, on the date that is five (5) years after the date on which the Company
completes its initial Business Combination, or earlier upon redemption or liquidation (the “Expiration Date”).
The Ordinary Shares and Warrants comprising the Units represented by this certificate are not transferable separately prior to
____________, 2018, unless Credit Suisse Securities (USA) LLC and Merrill Lynch, Pierce, Fenner & Smith Incorporated elect
to allow separate trading earlier, subject to the Company’s filing of a Current Report on Form 8-K with the Securities and
Exchange Commission containing an audited balance sheet reflecting the Company’s receipt of the gross proceeds of the initial
public offering and issuing a press release announcing when separate trading will begin. The terms of the Warrants are governed
by a Warrant Agreement, dated as of ____________, 2018, between the Company and Continental Stock Transfer & Trust
Company, as Warrant Agent, and are subject to the terms and provisions contained therein, all of which terms and provisions the
holder of this certificate consents to by acceptance hereof. Copies of the Warrant Agreement are on file at the office of the
Warrant Agent at 17 Battery Place, New York, New York 10004, and are available to any Warrant holder on written request and without
cost.

 

This certificate is not valid unless countersigned
by the Transfer Agent and Registrar of the Company.

 

     

     

    

  

This certificate shall be governed by and construed
in accordance with the internal laws of the State of New York. Witness the facsimile signature of its duly authorized officers.

 

	By:	 	 	By:	 
	 	Name:	 	 	Name:
	 	Title:Secretary	 	 	Title:President

 

    	 	2	 

     

    

 

One Madison Corporation

 

The Company will furnish without charge to each
unitholder who so requests, a statement of the powers, designations, preferences and relative, participating, optional or other
special rights of each class of equity or series thereof of the Company and the qualifications, limitations, or restrictions of
such preferences and/or rights.

 

The following abbreviations, when used in the
inscription on the face of this certificate, shall be construed as though they were written out in full according to applicable
laws or regulations:

 

	TEN COM	—   as tenants in common	UNIF GIFT MIN ACT—   ___________ Custodian
	 	 	___________
	TEN ENT	—   as tenants by the entireties	(Cust)
	 	 	(Minor)
	 	 	Under Uniform Gifts to Minors
	JT TEN	—   as joint tenants with right of survivorship and not as	 
	 	tenants in common	Act
	 	 	(State)

 

Additional abbreviations may also be used though
not in the above list.

 

For value received, ________ hereby sell,
assign and transfer unto ________

 

PLEASE INSERT SOCIAL SECURITY OR

OTHER

IDENTIFYING NUMBER OF ASSIGNEE

 

	 
	(PLEASE PRINT OR TYPEWRITE NAME AND ADDRESS, INCLUDING ZIP CODE, OF ASSIGNEE)
	 
	 

 

	 	Units represented by the within Certificate, and do hereby irrevocably constitute and 
	appoint	 

 

	 	Attorney to transfer the said Units on the books of the within named Corporation 
	with full power of substitution in the premises.	 

 

	Dated _______________

 

	 	 	 
	 	Notice:	The signature to this assignment
must correspond with the name as written upon the face of the certificate in every particular, without alteration or enlargement
or any change whatever.

 

Signature(s) Guaranteed:

 

 

THE SIGNATURE(S) MUST BE GUARANTEED BY AN ELIGIBLE GUARANTOR INSTITUTION
(BANKS, STOCKBROKERS, SAVINGS AND LOAN ASSOCIATIONS AND CREDIT UNIONS WITH MEMBERSHIP IN AN APPROVED SIGNATURE GUARANTEE MEDALLION
PROGRAM, PURSUANT TO S.E.C. RULE 17Ad-15 UNDER THE SECURITIES ACT OF 1933, AS AMENDED).

 

    	 	3	 

     

    

  

In each case, as more fully described in the
Company’s final prospectus dated ________________, the holder(s) of this certificate shall be entitled to receive a pro-rata
portion of certain funds held in the trust account established in connection with its initial public offering only (i) in the event
that the Company redeems the Class A Ordinary Shares sold in its initial public offering and liquidates because it does not consummate
an initial business combination within 24 months from the closing of its initial public offering or (ii) if the holder(s) (who
is not a director or officer of the Company and was not a shareholder of the Company immediately prior to the closing of its initial
public offering) seek(s) to redeem for cash his, her or its respective Class A Ordinary Shares in connection with (A) an amendment
to the Company’s Amended and Restated Memorandum and Articles of Association that would affect the substance or timing of
the Company's obligation to redeem 100% of the Class A Ordinary Shares if it does not consummate an initial business combination
within 24 months from the closing of its initial public offering, or (B) a tender offer (or proxy solicitation, solely in the event
the Company seeks shareholder approval of the proposed initial business combination) setting forth the details of a proposed initial
business combination. In no other circumstances shall the holder(s) have any right or interest of any kind in or to the trust account.

 

    	 	4

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