Document:

Exhibit 10.5 

 

EXECUTION VERSION

 

Salem
Media Group, Inc.

 

The Guarantors
listed on the signature pages hereof

 

$255,000,000

 

6.75% Senior Secured Notes due 2024

 

PURCHASE
AGREEMENT

 

dated May 11, 2017

 

Wells Fargo Securities, LLC

Barclays Capital Inc.

Noble Capital Markets, Inc.

 

     

     

    

 

PURCHASE AGREEMENT

 

May 11, 2017

 

Wells Fargo Securities,
LLC

As Representative
of the Initial Purchasers

c/o Wells Fargo Securities, LLC

550 S. Tryon Street

Charlotte, North Carolina 28202

 

Ladies and Gentlemen:

 

Introductory. Salem Media Group,
Inc., a Delaware corporation (the “Company”), proposes to issue and sell to the several Initial Purchasers named
in Schedule A (the “Initial Purchasers”), acting severally and not jointly, the respective amounts set
forth in such Schedule A of $255,000,000 aggregate principal amount of the Company’s 6.75% Senior Secured Notes due
2024 (the “Notes”). Wells Fargo Securities, LLC has agreed to act as the representative of the several Initial
Purchasers (the “Representative”) in connection with the offering and sale of the Notes.

 

The Securities (as defined below) will be
issued pursuant to an indenture, to be dated as of May 19, 2017 (the “Indenture”), among the Company, the Guarantors
(as defined below) and U.S. Bank National Association, as trustee (the “Trustee”). Notes will be issued only
in book-entry form in the name of Cede & Co., as nominee of The Depository Trust Company (the “Depositary”)
pursuant to a letter of representations, to be dated on or before the Closing Date (as defined in Section 2 hereof) (the “DTC
Agreement”), among the Company and the Depositary.

 

The payment of principal of, premium, if
any, and interest on the Notes will be fully and unconditionally guaranteed on a senior secured basis, jointly and severally by
(i) the entities listed on the signature pages hereof as “Guarantors” and (ii) any subsidiary of the Company formed
or acquired after the Closing Date that executes an additional guarantee in accordance with the terms of the Indenture, and their
respective successors and assigns (collectively, the “Guarantors”), pursuant to their guarantees (the “Guarantees”).
The Notes and the Guarantees attached thereto are herein collectively referred to as the “Securities.”

 

As described in the Pricing Disclosure Package
(as defined below) and the Final Memorandum, proceeds from the issuance and sale of the Securities shall be used to (i) refinance
the Company’s existing credit agreement and (ii) to pay related fees and expenses.

 

The issuance and sale of the Notes, the
issuance of the Guarantees, the entry by the Company and the Guarantors into a new senior first lien credit facility (the “Senior
Credit Facility”), the initial extensions of credit thereunder, if any, on the Closing Date, the refinancing of the Company’s
existing credit agreement as described in the Pricing Disclosure Package, and the payment of transaction costs are referred to
herein collectively, as the “Transactions.”

 

     

     

    

 

For purposes of this Purchase Agreement
(this “Agreement”), a “Business Day” means any day other than a Saturday or Sunday or other day
on which banking institutions in New York City are authorized or required by law to close.

 

The Notes will be secured
by a first priority lien on the Notes Priority Collateral (as defined in the Indenture) and by a second priority lien on the ABL
Priority Collateral (as defined in the Indenture), subject in each case to certain exceptions and Permitted Collateral Liens (as
defined in the Indenture) (collectively, the “Collateral”), as more particularly described in the Pricing Disclosure
Package and documented by a security agreement dated as of the Closing Date (the “Security Agreement”) and other
instruments evidencing or creating a security interest (collectively, the “Security Documents”) in favor of
U.S. Bank National Association, as collateral agent (in such capacity, the “Collateral Agent”), for its benefit
and the benefit of the Trustee and the holders of the Notes. The Notes Priority Collateral will be senior to a second priority
lien in favor of Wells Fargo Bank, N.A. as administrative agent under the Senior Credit Facility and as control agent (in such
capacity, the “Senior Credit Facility Administrative Agent”) for the benefit of the lenders under the Senior
Credit Agreement, and the ABL Priority Collateral will be subject to a first priority lien in favor of the Senior Credit Facility
Administrative Agent for the benefit of the lenders under the Senior Credit Facility.

 

The Company, the Guarantors,
the Collateral Agent and the Senior Credit Facility Administrative Agent will enter into an Intercreditor Agreement, dated as of
the Closing Date (the “Intercreditor Agreement”), with respect to collateral sharing arrangements, and the Securities
will be subject to such Intercreditor Agreement.

 

The Company understands that the Initial
Purchasers propose to make an offering of the Securities on the terms and in the manner set forth herein and in the Pricing Disclosure
Package and agrees that the Initial Purchasers may resell, subject to the conditions set forth herein, all or a portion of the
Securities to purchasers (the “Subsequent Purchasers”) on the terms set forth in the Pricing Disclosure Package
(the first time when sales of the Securities are made is referred to as the “Time of Sale”). The Securities
are to be offered and sold to or through the Initial Purchasers without being registered with the Securities and Exchange Commission
(the “Commission”) under the Securities Act of 1933 (as amended, the “Securities Act,” which
term, as used herein, includes the rules and regulations of the Commission promulgated thereunder), in reliance upon exemptions
therefrom. Pursuant to the terms of the Securities and the Indenture, investors who acquire Securities shall be deemed to have
agreed that Securities may only be resold or otherwise transferred, after the date hereof, if such Securities are registered for
sale under the Securities Act or if an exemption from the registration requirements of the Securities Act is available (including
the exemptions afforded by Rule 144A under the Securities Act (“Rule 144A”) or Regulation S under the Securities
Act (“Regulation S”)).

 

The Company has prepared and delivered to
each Initial Purchaser copies of a Preliminary Offering Memorandum, dated May 8, 2017 (the “Preliminary Offering Memorandum”),
and has prepared and delivered to each Initial Purchaser copies of a Pricing Supplement, dated May 11, 2017 (the “Pricing
Supplement”), describing the terms of the Securities, each for use by such Initial Purchaser in connection with its solicitation
of offers to purchase the Securities. The Preliminary Offering Memorandum and the Pricing Supplement are herein referred to as
the “Pricing Disclosure Package.” Promptly after this Agreement is executed and delivered, the Company will
prepare and deliver to each Initial Purchaser a final offering memorandum dated the date hereof (the “Final Offering Memorandum”).

 

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All references herein to the terms “Pricing
Disclosure Package” and “Final Offering Memorandum” shall be deemed to mean and include all reports
filed with the Commission under the Securities Exchange Act of 1934 (as amended, the “Exchange Act,” which term,
as used herein, includes the rules and regulations of the Commission promulgated thereunder) prior to the Time of Sale and incorporated
by reference in the Pricing Disclosure Package (including the Preliminary Offering Memorandum) or the Final Offering Memorandum
(as the case may be), and all references herein to the terms “amend,” “amendment” or “supplement”
with respect to the Final Offering Memorandum shall be deemed to mean and include all information filed under the Exchange Act
after the Time of Sale and incorporated by reference in the Final Offering Memorandum.

 

The Company hereby confirms its agreements
with the Initial Purchasers as follows:

 

SECTION 1.        Representations
and Warranties. Each of the Company and the Guarantors, jointly and severally, hereby represents, warrants and covenants to
each Initial Purchaser that, as of the date hereof and as of the Closing Date (references in this Section 1 to the “Offering
Memorandum” are to (x) the Pricing Disclosure Package in the case of representations and warranties made as of the date
hereof and (y) the Final Offering Memorandum in the case of representations and warranties made as of the Closing Date):

 

(a)          No
Registration Required. Subject to the accuracy of the representations and warranties of the Initial Purchasers set forth in
Section 2 hereof and compliance by the Initial Purchasers with the procedures set forth in Section 7 hereof, it is not necessary
in connection with the offer, sale and delivery of the Securities to the Initial Purchasers and to each Subsequent Purchaser in
the manner contemplated by this Agreement and the Final Memorandum to register the Securities under the Securities Act or to qualify
the Indenture under the Trust Indenture Act of 1939.

 

(b)          No
Integration of Offerings or General Solicitation. Neither the Company, the Guarantors, nor any of their respective affiliates
(as such term is defined in Rule 501 under the Securities Act) (each, an “Affiliate”), nor any person acting
on its or any of their behalf (other than the Initial Purchasers, as to whom the Company and the Guarantors make no representation
or warranty) has, directly or indirectly, solicited any offer to buy or offered to sell, or will, directly or indirectly, solicit
any offer to buy or offer to sell, in the United States or to any United States citizen or resident, any security which is or would
be integrated with the sale of the Securities in a manner that would require the Securities to be registered under the Securities
Act. None of the Company, the Guarantors, nor any of their respective Affiliates, or any person acting on its or any of their behalf
(other than the Initial Purchasers, as to whom the Company and the Guarantors make no representation or warranty) has engaged or
will engage, in connection with the offering of the Securities, in any form of general solicitation or general advertising within
the meaning of Rule 502 under the Securities Act. With respect to those Securities sold in reliance upon Regulation S, (i) none
of the Company, the Guarantors, nor any of their respective Affiliates or any person acting on its or any of their behalf (other
than the Initial Purchasers, as to whom the Company and the Guarantors make no representation or warranty) has engaged or will
engage in any directed selling efforts within the meaning of Regulation S and (ii) each of the Company, the Guarantors and their
respective Affiliates and any person acting on its or any of their behalf (other than the Initial Purchasers, as to whom the Company
and the Guarantors make no representation or warranty) has complied and will comply with the offering restrictions set forth in
Regulation S.

 

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(c)          Eligibility
for Resale under Rule 144A. Subject to the accuracy of the representations and warranties of the Initial Purchasers set forth
in Section 2 hereof and compliance by the Initial Purchasers with the procedures set forth in Section 7 hereof, the Securities
are eligible for resale pursuant to Rule 144A and will not be, at the Closing Date, of the same class as securities listed on a
national securities exchange registered under Section 6 of the Exchange Act or quoted in a U.S. automated interdealer quotation
system.

 

(d)          The
Pricing Disclosure Package and Offering Memorandum.  Neither the Pricing Disclosure Package, as of the Time of Sale, nor the
Final Offering Memorandum, as of its date or (as amended or supplemented in accordance with Section 3(a), as applicable) as of
the Closing Date, contains an untrue statement of a material fact or omits to state a material fact necessary in order to make
the statements therein, in the light of the circumstances under which they were made, not misleading; provided that this
representation, warranty and agreement shall not apply to statements in or omissions from the Pricing Disclosure Package, the Final
Offering Memorandum or any amendment or supplement thereto made in reliance upon and in conformity with information furnished to
the Company in writing by any Initial Purchaser through the Representative expressly for use in the Pricing Disclosure Package,
the Final Offering Memorandum or amendment or supplement thereto, as the case may be. The Pricing Disclosure Package contains,
and the Final Offering Memorandum will contain, all the information specified in, and meeting the requirements of, Rule 144A. The
Company has not distributed and will not distribute, prior to the later of the Closing Date and the completion of the Initial Purchasers’
distribution of the Securities, any offering material in connection with the offering and sale of the Securities other than the
Pricing Disclosure Package and the Final Offering Memorandum as each may be amended or supplemented pursuant to Section 3(a).

 

(e)          Company
Additional Written Communications. The Company has not prepared, made, used, authorized, approved or distributed and will not
prepare, make, use, authorize, approve or distribute any written communication that constitutes an offer to sell or solicitation
of an offer to buy the Securities other than (i) the Pricing Disclosure Package, (ii) the Final Offering Memorandum and (iii) any
electronic road show or other written communications, in each case used in accordance with Section 3(a). Each such communication
by the Company or its agents and representatives pursuant to clause (iii) of the preceding sentence (each, a “Company
Additional Written Communication”), when taken together with the Pricing Disclosure Package, did not as of the Time of
Sale, and at the Closing Date will not, contain any untrue statement of a material fact or omit to state a material fact necessary
in order to make the statements therein, in the light of the circumstances under which they were made, not misleading; provided
that this representation, warranty and agreement shall not apply to statements in or omissions from each such Company Additional
Written Communication made in reliance upon and in conformity with information furnished to the Company in writing by any Initial
Purchaser through the Representative expressly for use in any Company Additional Written Communication.

 

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(f)           Incorporated
Documents. The documents incorporated or deemed to be incorporated by reference in the Offering Memorandum at the time they
were or hereafter are filed with the Commission (collectively, the “Incorporated Documents”) complied, and will
comply, in all material respects with the requirements of the Exchange Act. Each such Incorporated Document, when taken together
with the Pricing Disclosure Package, did not as of the Time of Sale, and at the Closing Date will not, contain any untrue statement
of a material fact or omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances
under which they were made, not misleading.

 

(g)          The
Purchase Agreement. This Agreement has been duly authorized, executed and delivered by the Company and the Guarantors.

 

(h)          Authorization
of the Notes and the Guarantees. The Notes to be purchased by the Initial Purchasers from the Company will on the Closing Date
be in the form contemplated by the Indenture, have been duly authorized by the Company for issuance and sale pursuant to this Agreement
and the Indenture and, at the Closing Date, will have been duly executed by the Company and, when authenticated in the manner provided
for in the Indenture and issued and delivered against payment of the purchase price therefor, will constitute valid and binding
obligations of the Company, enforceable against the Company in accordance with their terms, except as the enforcement thereof may
be limited by bankruptcy, insolvency, reorganization, moratorium or other similar laws relating to or affecting the rights and
remedies of creditors or by general equitable principles and will be entitled to the benefits of the Indenture. The Guarantees
of the Notes on the Closing Date when issued pursuant to the Indenture have been duly authorized and, when the Notes have been
authenticated in the manner provided for in the Indenture and issued and delivered against payment of the purchase price therefor,
the Guarantees of the Notes will constitute valid and binding agreements of the Guarantors, in each case, enforceable in accordance
with their terms, except as the enforcement thereof may be limited by bankruptcy, insolvency, reorganization, moratorium or other
similar laws relating to or affecting the rights and remedies of creditors or by general equitable principles and will be entitled
to the benefits of the Indenture.

 

(i)           Authorization
of the Indenture. The Indenture has been duly authorized by the Company and the Guarantors and, at the Closing Date, will have
been duly executed and delivered by the Company and the Guarantors and, assuming due authorization, execution and delivery by the
Trustee, will constitute a valid and binding agreement of the Company and the Guarantors, enforceable against the Company and the
Guarantors in accordance with its terms, except as the enforcement thereof may be limited by bankruptcy, insolvency, reorganization,
moratorium or other similar laws relating to or affecting the rights and remedies of creditors or by general equitable principles.

 

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(j)           Authorization
of the Intercreditor Agreement. The Intercreditor Agreement has been duly authorized by the Company and each Guarantor and,
at the Closing Date, will have been duly executed and delivered by the Company and each Guarantor and will constitute a valid and
binding agreement of the Company and each Guarantor, enforceable against the Company and each Guarantor in accordance with its
terms, except as the enforcement thereof may be limited by bankruptcy, insolvency, reorganization, moratorium or other similar
laws relating to or affecting the rights and remedies of creditors or by general equitable principles.

 

(k)          Security
Documents. Each of the Security Documents has been duly authorized by the Company and/or the applicable Guarantor, as appropriate,
and, when executed and delivered by the Company and/or the applicable Guarantor, will constitute the legal, valid, binding and
enforceable agreement of the Company and/or the applicable Guarantor (subject, as to the enforcement of remedies, to applicable
bankruptcy, insolvency, reorganization, moratorium or other similar laws affecting creditors’ rights generally from time
to time in effect and by general principles of equity). The Security Documents, when executed and delivered in connection with
the sale of the Securities, will create in favor of the Collateral Agent for the benefit of itself, the Trustee and the holders
of the Notes, valid and enforceable security interests in and liens on the Collateral and, upon the filing of appropriate Uniform
Commercial Code financing statements in United States jurisdictions as set forth on Schedule B hereto and the taking of the other
actions, in each case as further described in the Security Documents, the security interests in and liens on the rights of the
Company or the applicable Guarantor in such Collateral will be perfected security interests and liens, superior to and prior to
the liens of all third persons other than the liens securing the Senior Credit Facility and Permitted Collateral Liens.

 

(l)           Description
of the Securities, the Indenture, the Security Documents, the Senior Credit Facility and the Intercreditor Agreement. The Securities,
the Indenture, the Security Documents, the Senior Credit Facility and the Intercreditor Agreement will conform in all material
respects to the respective statements relating thereto contained in the Pricing Disclosure Package and Final Offering Memorandum.

 

(m)         No
Material Adverse Change. Except as otherwise disclosed in the Offering Memorandum (exclusive of any amendment or supplement
thereto), subsequent to the respective dates as of which information is given in the Offering Memorandum (exclusive of any amendment
or supplement thereto): (i) there has been no material adverse change, or any development that could reasonably be expected to
result in a material adverse change, in the condition, financial or otherwise, or in the earnings, business, operations or prospects,
whether or not arising from transactions in the ordinary course of business, of the Company and its subsidiaries, considered as
one entity (any such change is called a “Material Adverse Change”); (ii) the Company and its subsidiaries, considered
as one entity, have not incurred any material liability or obligation, indirect, direct or contingent, not in the ordinary course
of business nor entered into any material transaction or agreement not in the ordinary course of business; and (iii) there has
been no dividend or distribution of any kind declared, paid or made by the Company or, except for dividends paid to the Company
or other subsidiaries, any of its subsidiaries on any class of capital stock or repurchase or redemption by the Company or any
of its subsidiaries of any class of capital stock.

 

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(n)          Independent
Accountants. Each of SingerLewak LLP and Crowe Howarth LLP, each of which expressed its respective opinion with respect to
the financial statements (which term as used in this Agreement includes the related notes thereto) and supporting schedules filed
with the Commission and included in the Offering Memorandum, is an independent registered public accounting firm within the meaning
of the Securities Act, the Exchange Act and the rules of the Public Company Accounting Oversight Board, and any non-audit services
provided by SingerLewak LLP or Crowe Horwath LLP to the Company or any of the Guarantors have been approved by the Audit Committee
of the Board of Directors of the Company.

 

(o)          Preparation
of the Financial Statements. The financial statements, together with the related schedules and notes, included in the Offering
Memorandum present fairly the consolidated financial position of the entities to which they relate as of and at the dates indicated
and the results of their operations and cash flows for the periods specified. Such financial statements have been prepared in conformity
with United States generally accepted accounting principles (“GAAP”) applied on a consistent basis throughout
the periods involved, except as may be expressly stated in the related notes thereto. The financial data set forth in the Offering
Memorandum under the captions “Summary Historical and Consolidated Financial and Other Data” and “Selected Consolidated
Financial and Other Data” fairly present the information set forth therein on a basis consistent with that of the audited
financial statements contained in the Offering Memorandum. The statistical and market-related data and forward-looking statements
included in the Offering Memorandum are based on or derived from sources that the Company and its subsidiaries believe to be reliable
and accurate in all material respects and represent their good faith estimates that are made on the basis of data derived from
such sources. The interactive data in eXtensible Business Reporting Language included or incorporated by reference in the Pricing
Disclosure Package and the Offering Memorandum fairly presents the information called for in all material respects and has been
prepared in accordance with the Commission's rules and guidelines applicable thereto.

 

(p)          Incorporation
and Good Standing of the Company and its Subsidiaries. Each of the Company and its subsidiaries has been duly incorporated
or formed, as applicable, and is validly existing as a corporation, limited partnership or limited liability company, as applicable,
in good standing under the laws of the jurisdiction of its incorporation or formation, as applicable, and has corporate, partnership
or limited liability company, as applicable, power and authority to own, lease and operate its properties and to conduct its business
as described in the Offering Memorandum and, in the case of the Company and the Guarantors, to enter into and perform its obligations
under each of this Agreement, the Securities, the Indenture, the Senior Credit Facility, the Security Documents and the Intercreditor
Agreement. Each of the Company and each subsidiary is duly qualified as a foreign corporation, limited partnership or limited liability
company, as applicable, to transact business and is in good standing in each jurisdiction in which such qualification is required,
whether by reason of the ownership or leasing of property or the conduct of business, except for such jurisdictions where the failure
to so qualify or to be in good standing would not, individually or in the aggregate, result in a Material Adverse Change. All of
the issued and outstanding capital stock or other ownership interest of each subsidiary has been duly authorized and validly issued,
is fully paid and nonassessable and is owned by the Company, directly or through subsidiaries, free and clear of any security interest,
mortgage, pledge, lien, encumbrance or claim, except as disclosed in the Offering Memorandum. The Company does not own or control,
directly or indirectly, any corporation, association or other entity other than the subsidiaries listed in Exhibit 21 to the
Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2016.

 

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(q)          Capitalization
and Other Capital Stock Matters. At December 31, 2016, on a consolidated basis, after giving pro forma effect to the issuance
and sale of the Securities pursuant hereto, the Company would have an authorized and outstanding capitalization as set forth in
the Offering Memorandum under the caption “Capitalization” (other than for subsequent issuances of capital stock, if
any, pursuant to employee benefit plans described in the Offering Memorandum or upon exercise of outstanding options or vesting
of other outstanding equity awards described in the Offering Memorandum).

 

(r)           Non-Contravention
of Existing Instruments; No Further Authorizations or Approvals Required. Neither the Company nor any of its subsidiaries is
(i) in violation of its charter, bylaws or other constitutive document or (ii) in default (or, with the giving of notice or lapse
of time, would be in default) (“Default”) under any indenture, mortgage, loan or credit agreement, note, contract,
franchise, lease or other instrument to which the Company or any of its subsidiaries is a party or by which it or any of them may
be bound (including, without limitation, the Company’s existing credit agreement), or to which any of the property or assets
of the Company or any of its subsidiaries is subject (each, an “Existing Instrument”), except, in the case of
clause (ii) above, for such Defaults as would not, individually or in the aggregate, result in a Material Adverse Change. The execution,
delivery and performance of this Agreement, the Indenture, the Senior Credit Facility, the Security Documents and the Intercreditor
Agreement by the Company and the Guarantors, and the issuance and delivery of the Securities, and consummation of the transactions
contemplated hereby and thereby and by the Offering Memorandum (i) have been duly authorized by all necessary corporate, limited
partnership or limited liability company action, as applicable, and will not result in any violation of the provisions of the charter,
bylaws or other constitutive document of the Company or any subsidiary, (ii) will not conflict with or constitute a breach of,
or Default or a Debt Repayment Triggering Event (as defined below) under, or result in the creation or imposition of any lien,
charge or encumbrance upon any property or assets of the Company or any of its subsidiaries pursuant to, or require the consent
of any other party to, any Existing Instrument (other than any Existing Instrument that is being discharged, repurchased, repaid
or redeemed in connection with the Transactions), except for such conflicts, breaches, Defaults, liens, charges or encumbrances
as would not, individually or in the aggregate, result in a Material Adverse Change and (iii) will not result in any violation
of any law, administrative regulation or administrative or court decree applicable to the Company or any subsidiary. No consent,
approval, authorization or other order of, or registration or filing with, any court or other governmental or regulatory authority
or agency is required for the execution, delivery and performance of this Agreement, the Indenture, the Senior Credit Facility,
the Security Documents and the Intercreditor Agreement by the Company and the Guarantors, or the issuance and delivery of the Securities,
or consummation of the transactions contemplated hereby and thereby and by the Offering Memorandum, except (A) such filings
as have been obtained or made by the Company or any such Guarantor and are in full force and effect under the Securities Act, applicable
securities laws of the several states of the United States or provinces of Canada and (B) filings of financing statements
under the Uniform Commercial Code as from time to time in effect in the relevant jurisdictions and any filing to be made in the
United States Patent and Trademark Office or the United States Copyright Office and such filings necessary to perfect the Collateral
Agent’s security interests in the Collateral. As used herein, a “Debt Repayment Triggering Event” means
any event or condition which gives, or with the giving of notice or lapse of time would give, the holder of any note, debenture
or other evidence of indebtedness (or any person acting on such holder’s behalf) the right to require the repurchase, redemption
or repayment of all or a portion of such indebtedness by the Company or any of its subsidiaries.

 

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(s)          No
Material Actions or Proceedings. There are no legal or governmental actions, suits or proceedings pending or, to the best of
the Company’s knowledge, threatened (i) against or affecting the Company or any of its subsidiaries or (ii) which has
as the subject thereof any property owned or leased by, the Company or any of its subsidiaries and any such action, suit or proceeding,
if determined adversely to the Company or such subsidiary, which would, in the case of (i) and (ii) above, result in a Material
Adverse Change or materially adversely affect the consummation of the transactions contemplated by this Agreement. No material
labor dispute with the employees of the Company or any of its subsidiaries exists or, to the best of the Company’s knowledge,
is threatened or imminent.

 

(t)           Intellectual
Property Rights. The Company and its subsidiaries own or possess sufficient trademarks, trade names, patent rights, copyrights,
licenses, approvals, trade secrets and other similar rights (collectively, “Intellectual Property Rights”) reasonably
necessary to conduct their businesses as now conducted; and the expected expiration of any of such Intellectual Property Rights
would not result in a Material Adverse Change. Neither the Company nor any of its subsidiaries has received any notice of infringement
or conflict with asserted Intellectual Property Rights of others, which infringement or conflict, if the subject of an unfavorable
decision, would result in a Material Adverse Change.

 

(u)          All
Necessary Permits, etc. The Company and each subsidiary possess such valid and current certificates, authorizations or permits
issued by the appropriate state, federal or foreign regulatory agencies or bodies necessary to own, lease and operate its properties
and to conduct their respective businesses, except where the failure to possess or make the same would not, individually or in
the aggregate, be reasonably expected to result in a Material Adverse Change; and neither the Company nor any subsidiary has received
any notice of proceedings relating to the revocation or modification of, or non-compliance with, any such certificate, authorization
or permit which, singly or in the aggregate, if the subject of an unfavorable decision, ruling or finding, would result in a Material
Adverse Change.

 

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(v)         Title
to Properties. The Company and each of its subsidiaries has good and marketable title to all the properties and assets reflected
as owned in the financial statements referred to in Section 1(o) hereof, in each case free and clear of any security interests,
mortgages, liens, encumbrances, equities, claims and other defects, except as disclosed in the Offering Memorandum and except such
as do not materially and adversely affect the value of such property and do not materially interfere with the use made or proposed
to be made of such property by the Company or such subsidiary. The real property, improvements, equipment and personal property
held under lease by the Company or any subsidiary are held under valid and enforceable leases, with such exceptions as are not
material and do not materially interfere with the use made or proposed to be made of such real property, improvements, equipment
or personal property by the Company or such subsidiary.

 

(w)         Collateral.
The Company and the Guarantors collectively own, have rights in or have the power to transfer rights in the Collateral, free and
clear of any Liens (as defined under the caption “Description of Notes” in the Offering Memorandum) other than Permitted
Collateral Liens.

 

(x)          Tax
Law Compliance. The Company and its subsidiaries have filed all necessary federal, state and foreign income and franchise tax
returns and have paid all taxes required to be paid by any of them and, if due and payable, any related or similar assessment,
fine or penalty levied against any of them except as may be being contested in good faith and by appropriate proceedings or except
where any such failure to so pay or so file is immaterial in amount or significance. The Company has made adequate charges, accruals
and reserves in accordance with GAAP in the applicable financial statements referred to in Section 1(n) and (o) hereof in respect
of all federal, state and foreign income and franchise taxes for all periods as to which the tax liability of the Company or any
of its subsidiaries has not been finally determined.

 

(y)          Company
and Guarantors Not an “Investment Company.” Neither the Company nor any Guarantor is, or after receipt of payment
for the Securities will be, required to register as an “investment company” within the meaning of the Investment Company
Act of 1940, as amended (the “Investment Company Act,” which term, as used herein, includes the rules and regulations
of the Commission promulgated thereunder) and will conduct its business in a manner so that it will not be required to register
as an “investment company” under the Investment Company Act.

 

(z)          Insurance.
Each of the Company and its subsidiaries are insured by recognized, financially sound institutions with policies in such amounts
and with such deductibles and covering such risks as are generally deemed adequate and customary for their businesses including,
without limitation, policies covering real and personal property owned or leased by the Company and its subsidiaries against theft,
damage, destruction, acts of vandalism and earthquakes. The Company has no reason to believe that it or any subsidiary will not
be able (i) to renew its existing insurance coverage as and when such policies expire or (ii) to obtain comparable coverage from
similar institutions as may be necessary or appropriate to conduct its business as now conducted and at a cost that would not result
in a Material Adverse Change. Neither of the Company nor any subsidiary has been denied any insurance coverage which it has sought
or for which it has applied.

 

    	 	10	 

     

    

 

(aa)         No
Price Stabilization or Manipulation. None of the Company or any of the Guarantors has taken and or will take, directly or indirectly,
any action designed to or that might be reasonably expected to cause or result in stabilization or manipulation of the price of
any security of the Company to facilitate the sale or resale of the Securities.

 

(bb)         Solvency.
Each of the Company and the Guarantors is, and immediately after the Closing Date will be, Solvent. As used herein, the term “Solvent”
means, with respect to any person on a particular date, that on such date (i) the fair market value of the assets of such person
is greater than the total amount of liabilities (including contingent liabilities) of such person, (ii) the present fair salable
value of the assets of such person is greater than the amount that will be required to pay the probable liabilities of such person
on its debts as they become absolute and matured, (iii) such person is able to realize upon its assets and pay its debts and other
liabilities, including contingent obligations, as they mature and (iv) such person does not have unreasonably small capital.

 

(cc)         Compliance
with Sarbanes-Oxley. The Company and its subsidiaries and their respective officers and directors, in their capacities as such,
are in compliance in all material respects with the applicable provisions of the Sarbanes-Oxley Act of 2002 (the “Sarbanes-Oxley
Act,” which term, as used herein, includes the rules and regulations of the Commission promulgated thereunder).

 

(dd)         Company’s
Accounting System. The Company and its subsidiaries maintain a system of accounting controls that is in compliance with the
Sarbanes-Oxley Act and is sufficient to provide reasonable assurances that: (i) transactions are executed in accordance with management’s
general or specific authorization; (ii) transactions are recorded as necessary to permit preparation of financial statements in
conformity with GAAP and to maintain accountability for assets; (iii) access to assets is permitted only in accordance with management’s
general or specific authorization; and (iv) the recorded accountability for assets is compared with existing assets at reasonable
intervals and appropriate action is taken with respect to any differences.

 

(ee)         Disclosure
Controls and Procedures. The Company has established and maintains disclosure controls and procedures (as such term is defined
in Rules 13a-15 and 15d-15 under the Exchange Act); such disclosure controls and procedures are designed to ensure that information
required to be disclosed by the Company in the reports that it files under the Exchange Act is recorded, processed, summarized
and reported, within the time periods specified in the Commission’s rules and forms and communicated to the Company’s
management, including its chief executive officer and chief financial officer, as appropriate to allow timely decisions regarding
required disclosure. As of December 31, 2016, except as disclosed in the Pricing Disclosure Package, such disclosure controls and
procedures were effective. The Company’s auditors and the Audit Committee of the Board of Directors of the Company have been
advised of: (i) any significant deficiencies or material weaknesses in the design or operation of internal controls which
could adversely affect the Company’s ability to record, process, summarize, and report financial data; and (ii) any
fraud, whether or not material, that involves management or other employees who have a role in the Company’s internal controls;
and since the date of the most recent evaluation of such disclosure controls and procedures, there have been no significant changes
in internal controls or in other factors that could significantly affect internal controls, including any corrective actions with
regard to significant deficiencies and material weaknesses.

 

    	 	11	 

     

    

 

(ff)          Regulations
T, U, X. Neither the Company nor any Guarantor nor any of their respective subsidiaries nor any agent thereof acting on their
behalf has taken, and none of them will take, any action that might cause this Agreement or the issuance or sale of the Securities
to violate Regulation T, Regulation U or Regulation X of the Board of Governors of the Federal Reserve System.

 

(gg)         Compliance
with and Liability under Environmental Laws. Except as would not, individually or in the aggregate, reasonably be expected
to result in a Material Adverse Change: (i) each of the Company and its subsidiaries and their respective operations and facilities
are in compliance with, and not subject to any known liabilities under, applicable Environmental Laws, which compliance includes,
without limitation, having obtained and being in compliance with any permits, licenses or other governmental authorizations or
approvals, and having made all filings and provided all financial assurances and notices, required for the ownership and operation
of the business, properties and facilities of the Company or its subsidiaries under applicable Environmental Laws, and compliance
with the terms and conditions thereof; (ii) neither the Company nor any of its subsidiaries has received any written communication,
whether from a governmental authority, citizens group, employee or otherwise, that alleges that the Company or any of its subsidiaries
is in violation of any Environmental Law; (iii) there is no claim, action or cause of action filed with a court or governmental
authority, no investigation with respect to which the Company has received written notice, and no written notice by any person
or entity alleging actual or potential liability on the part of the Company or any of its subsidiaries based on or pursuant to
any Environmental Law pending or, to the best of the Company’s knowledge, threatened against the Company or any of its subsidiaries
or any person or entity whose liability under or pursuant to any Environmental Law the Company or any of its subsidiaries has retained
or assumed either contractually or by operation of law; (iv) neither the Company nor any of its subsidiaries is conducting or paying
for, in whole or in part, any investigation, response or other corrective action pursuant to any Environmental Law at any site
or facility, nor is any of them subject or a party to any order, judgment, decree, contract or agreement which imposes any obligation
or liability under any Environmental Law; (v) no lien, charge, encumbrance or restriction has been recorded pursuant to any Environmental
Law with respect to any assets, facility or property owned, operated or leased by the Company or any of its subsidiaries; and (vi)
there are no past or present actions, activities, circumstances, conditions or occurrences, including, without limitation, the
Release or threatened Release of any Material of Environmental Concern, that could reasonably be expected to result in a violation
of or liability under any Environmental Law on the part of the Company or any of its subsidiaries, including without limitation,
any such liability which the Company or any of its subsidiaries has retained or assumed either contractually or by operation of
law.

 

    	 	12	 

     

    

 

For purposes of this Agreement,
“Environment” means ambient air, indoor air, surface water, groundwater, drinking water, soil, surface and subsurface
strata, and natural resources such as wetlands, flora and fauna. “Environmental Laws” means the common law and
all federal, state, local and foreign laws or regulations, ordinances, codes, orders, decrees, judgments and injunctions issued,
promulgated or entered thereunder, relating to pollution or protection of the Environment or human health, including without limitation,
those relating to (i) the Release or threatened Release of Materials of Environmental Concern; and (ii) the manufacture, processing,
distribution, use, generation, treatment, storage, transport, handling or recycling of Materials of Environmental Concern. “Materials
of Environmental Concern” means any substance, material, pollutant, contaminant, chemical, waste, compound, or constituent,
in any form, including without limitation, petroleum and petroleum products, subject to regulation or which can give rise to liability
under any Environmental Law. “Release” means any release, spill, emission, discharge, deposit, disposal, leaking,
pumping, pouring, dumping, emptying, injection or leaching into the Environment, or into, from or through any building, structure
or facility.

 

(hh)         Periodic
Review of Costs of Environmental Compliance. In the ordinary course of its business, the Company conducts a periodic review
of the effect of Environmental Laws on the business, operations and properties of the Company and its subsidiaries, in the course
of which it identifies and evaluates associated costs and liabilities (including, without limitation, any capital or operating
expenditures required for clean-up, closure of properties or compliance with Environmental Laws or any permit, license or approval,
any related constraints on operating activities and any potential liabilities to third parties). On the basis of such review and
the amount of its established reserves, the Company has reasonably concluded that such associated costs and liabilities would not,
individually or in the aggregate, result in a Material Adverse Change.

 

(ii)           ERISA
Compliance. The Company and its subsidiaries and any “employee benefit plan” (as defined under the Employee Retirement
Income Security Act of 1974 (as amended, “ERISA,” which term, as used herein, includes the regulations and published
interpretations thereunder) established or maintained by the Company, its subsidiaries or their ERISA Affiliates (as defined below)
are in compliance in all material respects with ERISA and, to the knowledge of the Company, each “multiemployer plan”
(as defined in Section 4001 of ERISA) to which the Company, its subsidiaries or an ERISA Affiliate contributes (a “Multiemployer
Plan”) is in compliance in all material respects with ERISA. “ERISA Affiliate” means, with respect
to the Company or a subsidiary, any member of any group of organizations described in Section 414 of the Internal Revenue
Code of 1986 (as amended, the “Code,” which term, as used herein, includes the regulations and published interpretations
thereunder) of which the Company or such subsidiary is a member. No “reportable event” (as defined under ERISA) has
occurred or is reasonably expected to occur with respect to any “employee benefit plan” established or maintained by
the Company, its subsidiaries or any of their ERISA Affiliates. No “single employer plan” (as defined in Section 4001
of ERISA) established or maintained by the Company, its subsidiaries or any of their ERISA Affiliates, if such “employee
benefit plan” were terminated, would have any “amount of unfunded benefit liabilities” (as defined under ERISA).
Neither the Company, its subsidiaries nor any of their ERISA Affiliates has incurred or reasonably expects to incur any liability
under (i) Title IV of ERISA with respect to termination of, or withdrawal from, any “employee benefit plan” or (ii)
Sections 412, 4971, 4975 or 4980B of the Code. Each “employee benefit plan” established or maintained by the Company,
its subsidiaries or any of their ERISA Affiliates that is intended to be qualified under Section 401 of the Code is so qualified
and nothing has occurred, whether by action or failure to act, which would cause the loss of such qualification.

 

    	 	13	 

     

    

 

(jj)         Compliance
with Labor Laws. Except as would not, individually or in the aggregate, result in a Material Adverse Change, (i) there is (A)
no unfair labor practice complaint pending or, to the best of the Company’s knowledge, threatened against the Company or
any of its subsidiaries before the National Labor Relations Board, and no grievance or arbitration proceeding arising out of or
under collective bargaining agreements pending, or to the best of the Company’s knowledge, threatened, against the Company
or any of its subsidiaries, (B) no strike, labor dispute, slowdown or stoppage pending or, to the best of the Company’s knowledge,
threatened against the Company or any of its subsidiaries and (C) no union representation question existing with respect to the
employees of the Company or any of its subsidiaries and, to the best of the Company’s knowledge, no union organizing activities
taking place and (ii) there has been no violation of any federal, state or local law relating to discrimination in hiring, promotion
or pay of employees or of any applicable wage or hour laws.

 

(kk)         Related
Party Transactions. No relationship, direct or indirect, exists between or among any of the Company or any affiliate of the
Company, on the one hand, and any director, officer, member, stockholder, customer or supplier of the Company or any affiliate
of the Company, on the other hand, which is required by the Securities Act to be disclosed in a registration statement on Form
S-1 which is not so disclosed in the Offering Memorandum. There are no outstanding loans, advances (except advances for business
expenses in the ordinary course of business) or guarantees of indebtedness by the Company or any affiliate of the Company to or
for the benefit of any of the officers or directors of the Company or any affiliate of the Company or any of their respective family
members.

 

(ll)           No
Unlawful Contributions or Other Payments. Neither the Company nor any of its subsidiaries nor, to the knowledge of the Company
or any of the Guarantors, any director, officer, agent, employee or affiliate of the Company or any of its subsidiaries is aware
of or has taken any action, directly or indirectly, that has resulted nor would result in a violation by any such persons of the
FCPA or any other applicable anti-bribery or anti-corruption law, including, without limitation, any offer, payment, promise to
pay or authorization of the payment of any money, or other property, gift, promise to give, or authorization of the giving of anything
of value to any “foreign official” (as such term is defined in the FCPA) or any foreign political party or official
thereof or any candidate for foreign political office, in contravention of the FCPA or any other applicable anti-bribery or anti-corruption
law and the Company and its subsidiaries and, to the knowledge of the Company and the Guarantors, its and their other affiliates
have conducted their businesses in compliance with the FCPA and other applicable anti-bribery and anti-corruption laws and have
instituted and maintain policies and procedures designed to ensure, and which are reasonably expected to continue to ensure, continued
compliance therewith.

 

    	 	14	 

     

    

 

“FCPA” means
Foreign Corrupt Practices Act of 1977, as amended, and the rules and regulations thereunder.

 

(mm)       No
Conflict with Money Laundering Laws. The operations of the Company and its subsidiaries are and have been conducted at all
times in compliance with applicable financial recordkeeping and reporting requirements of the Currency and Foreign Transactions
Reporting Act of 1970, as amended, the money laundering statutes of all applicable jurisdictions, the rules and regulations thereunder
and any related or similar rules, regulations or guidelines issued, administered or enforced by any governmental agency (collectively,
the “Money Laundering Laws”) and no action, suit or proceeding by or before any court or governmental agency,
authority or body or any arbitrator involving the Company or any of its subsidiaries with respect to the Money Laundering Laws
is pending or, to the knowledge of the Company or any of the Guarantors, threatened.

 

(nn)         No
Conflict with Sanctions Laws. Neither the Company nor any of its subsidiaries nor, to the knowledge of the Company or any of
the Guarantors, any director, officer, agent, employee or affiliate of the Company or any of its subsidiaries is currently subject
to any U.S. sanctions administered by the Office of Foreign Assets Control of the U.S. Treasury Department or any other relevant
sanctions authority (collectively, “Sanctions”); and the Company shall not use the proceeds of the offering
or otherwise make available such proceeds to any subsidairy or other person or entity to fund or facilitate any activities of or
business with any person that, at the time of such funding or facilitation, is the subject or the target of any Sanctions, (ii)
to fund or facilitate any activities of or any business in any country, that, at the time of such funding, is the subject of Sanctions
or (iii) in any other manner that could result in a violation by any person (including any person participating in the transaction,
whether as an Initial Purchaser or otherwise) of any Sanctions.

 

(oo)         New
Senior Credit Facility. The Senior Credit Facility has been duly and validly authorized by the Company and the Guarantors and,
when duly executed and delivered by the Company and the Guarantors, will be the valid and legally binding obligation of the Company
and the Guarantors, enforceable in accordance with its terms, except as the enforcement thereof may be limited by bankruptcy, insolvency,
reorganization, moratorium or other similar laws relating to or affecting the rights and remedies of creditors or by general equitable
principles.

 

    	 	15	 

     

    

 

(pp)         Stock
Options.  With respect to the stock options (the “Stock Options”) granted pursuant to the stock-based compensation
plans of the Company and its subsidiaries (the “Company Stock Plans”), except where the failure of the foregoing
representations to be true and correct would not, individually or in the aggregate, reasonably be expected to result in a Material
Adverse Change: (i) each Stock Option that has been exercised on or prior to the date of this Agreement that was intended to qualify
as an “incentive stock option” under Section 422 of the Code so qualifies, (ii) each grant of a Stock Option was duly
authorized no later than the date on which the grant of such Stock Option was by its terms to be effective (the “Grant
Date”) by all necessary corporate action, including, as applicable, approval by the board of directors of the Company
(or a duly constituted and authorized committee thereof) and any required stockholder approval by the necessary number of votes
or written consents, and the award agreement governing such grant (if any) was duly executed and delivered by each party thereto,
(iii) each such grant was made in accordance with the terms of the Company Stock Plans, the Exchange Act and all other applicable
laws and regulatory rules or requirements, including the rules of any securities exchange on which Company securities are traded,
(iv) the per share exercise price of each Stock Option was equal to the fair market value of a share of common stock on the applicable
Grant Date and (v) each such grant was properly accounted for in accordance with GAAP in the financial statements (including the
related notes) of the Company and disclosed in the Company’s filings with the Commission in accordance with the Exchange
Act and all other applicable laws. The Company has not knowingly granted, and there is no and has been no policy or practice of
the Company of granting, Stock Options prior to, or otherwise coordinating the grant of Stock Options with, the release or other
public announcement of material information regarding the Company or its subsidiaries or their results of operations or prospects.

 

(qq)         Regulation
S. The Company, the Guarantors and their respective affiliates and all persons acting on their behalf (other than the Initial
Purchasers, as to whom the Company and the Guarantors make no representation) have complied with and will comply with the offering
restrictions requirements of Regulation S in connection with the offering of the Securities outside the United States and,
in connection therewith, the Offering Memorandum will contain the disclosure required by Rule 902. Each of the Company and
the Guarantors is a “reporting issuer,” as defined in Rule 902 under the Securities Act.

 

Any certificate signed by an officer of
the Company or any Guarantor and delivered to the Initial Purchasers or to counsel for the Initial Purchasers shall be deemed to
be a representation and warranty by the Company or such Guarantor to each Initial Purchaser as to the matters set forth therein.

 

SECTION 2.        Purchase,
Sale and Delivery of the Securities.

 

(a)          The
Securities. Each of the Company and the Guarantors agrees to issue and sell to the Initial Purchasers, severally and not jointly,
all of the Notes, and the Initial Purchasers agree, severally and not jointly, to purchase from the Company and the Guarantors
the aggregate principal amount of Notes set forth opposite their names on Schedule A, at a purchase price of 98.5314% of the
principal amount thereof payable on the Closing Date, in each case, on the basis of the representations, warranties and agreements
herein contained, and upon the terms, subject to the conditions thereto, herein set forth.

 

    	 	16	 

     

    

 

(b)          The
Closing Date. Delivery of certificates for the Securities in definitive form to be purchased by the Initial Purchasers and
payment therefor shall be made at the offices of Cahill Gordon & Reindel llp,
80 Pine Street, New York, NY 10005 (or such other place as may be agreed to by the Company and Wells Fargo Securities, LLC)
at 9:00 a.m. New York City time, on May 19, 2017, or such other time and date as Wells Fargo Securities, LLC shall designate
by notice to the Company (the time and date of such closing are called the “Closing Date”). The Company hereby
acknowledges that circumstances under which Wells Fargo Securities, LLC may provide notice to postpone the Closing Date as originally
scheduled include, but are in no way limited to, any determination by the Company or the Initial Purchasers to recirculate to investors
copies of an amended or supplemented Offering Memorandum or a delay as contemplated by the provisions of Section 17 hereof.

 

(c)          Delivery
of the Securities. The Company shall deliver, or cause to be delivered, to the Representative for the accounts of the several
Initial Purchasers certificates for the Notes at the Closing Date against the irrevocable release of a wire transfer of immediately
available funds for the amount of the purchase price therefor. The certificates for the Notes shall be in such denominations and
registered in the name of Cede & Co., as nominee of the Depositary, pursuant to the DTC Agreement, and shall be made available
for inspection on the Business Day preceding the Closing Date at a location in New York City, as Wells Fargo Securities, LLC may
designate. Time shall be of the essence, and delivery at the time and place specified in this Agreement is a further condition
to the obligations of the Initial Purchasers.

 

(d)          Initial
Purchasers as Qualified Institutional Buyers. Each Initial Purchaser severally and not jointly represents and warrants to,
and agrees with, the Company that:

 

(i)          it
will offer and sell Securities only to (a) persons who it reasonably believes are “qualified institutional buyers”
within the meaning of Rule 144A ( “Qualified Institutional Buyers”) in transactions meeting the requirements
of Rule 144A or (b) upon the terms and conditions set forth in Annex I to this Agreement;

 

(ii)         it
is an institutional “accredited investor” within the meaning of Rule 501(a)(1), (2), (3) or (7) under the Securities
Act; and

 

(iii)        it
will not offer or sell Securities by, any form of general solicitation or general advertising, including but not limited to the
methods described in Rule 502(c) under the Securities Act.

 

SECTION 3.        Additional
Covenants. Each of the Company and the Guarantors further covenants and agrees with each Initial Purchaser as follows:

 

(a)          Preparation
of Final Offering Memorandum; Initial Purchasers’ Review of Proposed Amendments and Supplements and Company Additional Written
Communications. As promptly as practicable following the Time of Sale and in any event not later than the second Business Day
following the date hereof, the Company will prepare and deliver to the Initial Purchasers the Final Offering Memorandum, which
shall consist of the Preliminary Offering Memorandum as modified only by the information contained in the Pricing Supplement. The
Company will not amend or supplement the Preliminary Offering Memorandum, the Pricing Supplement or the Final Offering Memorandum
prior to the Closing Date unless the Representative and counsel for the Initial Purchasers shall previously have been furnished
a copy of the proposed amendment or supplement at least two Business Days prior to the proposed use or filing, and shall not have
objected to such amendment or supplement. Before making, preparing, using, authorizing, approving or distributing any Company Additional
Written Communication, the Company will furnish to the Representative a copy of such written communication for review and will
not make, prepare, use, authorize, approve or distribute any such written communication to which the Representative reasonably
objects.

 

    	 	17	 

     

    

 

(b)          Amendments
and Supplements to the Pricing Disclosure Package, Final Offering Memorandum and Other Securities Act Matters. If at any time
prior to the Closing Date (i) any event shall occur or condition shall exist as a result of which any of the Pricing Disclosure
Package as then amended or supplemented would include any untrue statement of a material fact or omit to state any material fact
necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading
or (ii) it is necessary to amend or supplement any of the Pricing Disclosure Package to comply with law, the Company and the Guarantors
will immediately notify the Initial Purchasers thereof and forthwith prepare and (subject to Section 3(a) hereof) furnish to the
Initial Purchasers such amendments or supplements to any of the Pricing Disclosure Package as may be necessary so that the statements
in any of the Pricing Disclosure Package as so amended or supplemented will not, in the light of the circumstances under which
they were made, be misleading or so that any of the Pricing Disclosure Package will comply with all applicable law. If, prior to
the completion of the placement of the Securities by the Initial Purchasers with the Subsequent Purchasers, any event shall occur
or condition exist as a result of which it is necessary to amend or supplement the Final Offering Memorandum, as then amended or
supplemented, in order to make the statements therein, in the light of the circumstances when the Final Offering Memorandum is
delivered to a Subsequent Purchaser, not misleading, or if in the judgment of the Representative or counsel for the Initial Purchasers
it is otherwise necessary to amend or supplement the Final Offering Memorandum to comply with law, the Company and the Guarantors
agree to promptly prepare (subject to Section 3 hereof) and furnish at its own expense to the Initial Purchasers, amendments or
supplements to the Final Offering Memorandum so that the statements in the Final Offering Memorandum as so amended or supplemented
will not, in the light of the circumstances at the Closing Date and at the time of sale of Securities, be misleading or so that
the Final Offering Memorandum, as amended or supplemented, will comply with all applicable law.

 

The Company hereby expressly acknowledges
that the indemnification and contribution provisions of Sections 8 and 9 hereof are specifically applicable and relate to
each offering memorandum, amendment or supplement referred to in this Section 3.

 

(c)          Copies
of the Offering Memorandum. The Company agrees to furnish the Initial Purchasers, without charge, as many copies of the Pricing
Disclosure Package and the Final Offering Memorandum and any amendments and supplements thereto as they shall reasonably request.

 

    	 	18	 

     

    

 

(d)          Blue
Sky Compliance. Each of the Company and the Guarantors shall cooperate with the Representative and counsel for the Initial
Purchasers to qualify or register (or to obtain exemptions from qualifying or registering) all or any part of the Securities for
offer and sale under the securities laws of the several states of the United States, the provinces of Canada or any other jurisdictions
designated by the Representative, shall comply with such laws and shall continue such qualifications, registrations and exemptions
in effect so long as required for the distribution of the Securities. None of the Company or any of the Guarantors shall be required
to qualify as a foreign corporation or to take any action that would subject it to general service of process in any such jurisdiction
where it is not presently qualified or where it would be subject to taxation as a foreign corporation. The Company will advise
the Representative promptly of the suspension of the qualification or registration of (or any such exemption relating to) the Securities
for offering, sale or trading in any jurisdiction or any initiation or threat of any proceeding for any such purpose, and in the
event of the issuance of any order suspending such qualification, registration or exemption, each of the Company and the Guarantors
shall use its best efforts to obtain the withdrawal thereof at the earliest possible moment.

 

(e)          Use
of Proceeds. The Company shall apply the net proceeds from the sale of the Securities sold by it in the manner described under
the caption “Use of Proceeds” in the Pricing Disclosure Package.

 

(f)           The
Depositary. The Company will cooperate with the Initial Purchasers and use its best efforts to permit the Securities to be
eligible for clearance and settlement through the facilities of the Depositary.

 

(g)          The
Liens. The Company and the Guarantors shall cause the Securities to be secured by (i) a perfected first priority lien on the
Notes Priority Collateral (it being understood that the Senior Credit Facility shall be secured by a perfected second priority
lien on the Notes Priority Collateral) and (ii) a perfected second priority lien on the ABL Priority Collateral (it being understood
that the Senior Credit Facility shall be secured by a perfected first priority lien on the ABL Priority Collateral), in each case
to the extent and in the manner provided for in the Indenture and the Security Documents and as described in the Offering Memorandum,
and further subject in each case to there being no Liens except Permitted Liens.

 

(h)          Additional
Issuer Information. Prior to the completion of the placement of the Securities by the Initial Purchasers with the Subsequent
Purchasers, the Company shall file, on a timely basis, with the Commission and the Nasdaq Global Market all reports and documents
required to be filed under Section 13 or 15 of the Exchange Act. Additionally, at any time when the Company is not subject to Section
13 or 15 of the Exchange Act, for the benefit of holders and beneficial owners from time to time of the Securities, the Company
shall furnish, at its expense, upon request, to holders and beneficial owners of Securities and prospective purchasers of Securities
information (“Additional Issuer Information”) satisfying the requirements of Rule 144A(d).

 

(i)           Agreement
Not To Offer or Sell Additional Securities. During the period of 180 days following the date hereof, the Company will not,
without the prior written consent of Wells Fargo Securities, LLC (which consent may be withheld at the sole discretion of Wells
Fargo Securities, LLC), directly or indirectly, sell, offer, contract or grant any option to sell, pledge, transfer or establish
an open “put equivalent position” within the meaning of Rule 16a-1 under the Exchange Act, or otherwise dispose of
or transfer, or announce the offering of, or file any registration statement under the Securities Act in respect of, any debt securities
of the Company or securities exchangeable for or convertible into debt securities of the Company (other than as contemplated by
this Agreement).

 

    	 	19	 

     

    

 

(j)           No
Integration. The Company agrees that it will not and will cause its Affiliates not to make any offer or sale of securities
of the Company of any class if, as a result of the doctrine of “integration” referred to in Rule 502 under the Securities
Act, such offer or sale would render invalid (for the purpose of (i) the sale of the Securities by the Company to the Initial Purchasers,
(ii) the resale of the Securities by the Initial Purchasers to Subsequent Purchasers or (iii) the resale of the Securities by such
Subsequent Purchasers to others) the exemption from the registration requirements of the Securities Act provided by Section 4(a)(2)
thereof or by Rule 144A or by Regulation S thereunder or otherwise.

 

(k)          No
General Solicitation or Directed Selling Efforts. The Company agrees that it will not and will not permit any of its Affiliates
or any other person acting on its or their behalf (other than the Initial Purchasers, as to which no covenant is given) to (i) solicit
offers for, or offer or sell, the Securities by means of any form of general solicitation or general advertising within the meaning
of Rule 502(c) of Regulation D or in any manner involving a public offering within the meaning of Section 4(a)(2) of the Securities
Act or (ii) engage in any directed selling efforts with respect to the Securities within the meaning of Regulation S, and the Company
will and will cause all such persons to comply with the offering restrictions requirement of Regulation S with respect to the Securities.

 

(l)           No
Restricted Resales. During the one-year period after the Closing Date (or such shorter period as may be provided for in Rule
144), the Company will not permit any of its affiliates (as defined in Rule 144 under the Securities Act) to resell any of the
Notes that have been reacquired by the Company or such affiliates.

 

(m)         Legended
Securities. Each certificate for a Note will bear the legend contained in “Notice to Investors” in the Preliminary
Offering Memorandum for the time period and upon the other terms stated in the Preliminary Offering Memorandum.

 

Wells Fargo Securities, LLC, on behalf of
the several Initial Purchasers, may, in its sole discretion, waive in writing the performance by the Company or any Guarantor of
any one or more of the foregoing covenants or extend the time for their performance.

 

    	 	20	 

     

    

 

SECTION 4.        Payment
of Expenses. Each of the Company and the Guarantors agrees to pay all costs, fees and expenses incurred in connection with
the performance of its obligations hereunder and in connection with the transactions contemplated hereby, including, without limitation,
(i) all expenses incident to the issuance and delivery of the Securities (including all printing and engraving costs), (ii) all
necessary issue, transfer and other stamp taxes in connection with the issuance and sale of the Securities to the Initial Purchasers,
(iii) all fees and expenses of the Company’s and the Guarantors’ counsel, independent public or certified public accountants
and other advisors, (iv) all costs and expenses incurred in connection with the preparation, printing, filing, shipping and distribution
of the Pricing Disclosure Package and the Final Offering Memorandum (including financial statements and exhibits), and all amendments
and supplements thereto, this Agreement, the Indenture, the DTC Agreement, the Notes and Guarantees, the Security Documents and
the Intercreditor Agreement, (v) all filing fees, attorneys’ fees and expenses incurred by the Company, the Guarantors or
the Initial Purchasers in connection with qualifying or registering (or obtaining exemptions from the qualification or registration
of) all or any part of the Securities for offer and sale under the securities laws of the several states of the United States,
the provinces of Canada or other jurisdictions designated by the Initial Purchasers (including, without limitation, the cost of
preparing, printing and mailing preliminary and final blue sky or legal investment memoranda and any related supplements to the
Pricing Disclosure Package or the Final Offering Memorandum, (vi) the reasonable fees and expenses of the Trustee, including the
reasonable fees and disbursements of counsel for the Trustee in connection with the Indenture, the Securities, the Security Documents
and the Intercreditor Agreement, (vii) any fees payable in connection with the rating of the Securities with the ratings agencies,
(viii) all Company expenses incident to the “road show” for the offering of the Securities, including the cost of any
chartered airplane or other transportation (it being understood that the Initial Purchasers, collectively, shall bear their own
transportation and other “road show” travel expenses and one-half of the documented costs associated with any chartered
aircraft), (ix) all fees, costs and expenses (including the reasonable and documented expenses of counsel for the Initial
Purchasers related thereto) of creating and perfecting security in interests in the Collateral, including all filing, recording
and post-closing fees and expenses and related taxes with respect thereto, as set forth in the Security Documents and (x) all
fees and expenses (including reasonable fees and expenses of counsel) of the Company and the Guarantors in connection with approval
of the Securities by the Depositary for “book-entry” transfer, and the performance by the Company and the Guarantors
of their respective other obligations under this Agreement. Except as provided in this Section 4 and Sections 6, 8 and
9 hereof, the Initial Purchasers shall pay their own expenses, including the fees and disbursements of their counsel.

 

SECTION 5.        Conditions
of the Obligations of the Initial Purchasers. The obligations of the several Initial Purchasers to purchase and pay for the
Securities as provided herein on the Closing Date shall be subject to the accuracy of the representations and warranties on the
part of the Company and the Guarantors set forth in Section 1 hereof as of the date hereof and as of the Closing Date as though
then made and to the timely performance by the Company of its covenants and other obligations hereunder, and to each of the following
additional conditions:

 

(a)          Accountants’
Comfort Letters. On the date hereof, the Initial Purchasers shall have received from each of SingerLewak LLP and Crowe Horwath
LLP, the former and current independent registered public accounting firm for the Company, respectively, a “comfort letter”
dated the date hereof addressed to the Initial Purchasers, in form and substance satisfactory to the Representative, covering the
financial information in the Pricing Disclosure Package and other customary matters. In addition, on the Closing Date, the Initial
Purchasers shall have received from such accountants, a “bring-down comfort letter” dated the Closing Date addressed
to the Initial Purchasers, in form and substance satisfactory to the Representative, in the form of the “comfort letter”
delivered on the date hereof, except that (i) it shall cover the financial information in the Final Offering Memorandum and any
amendment or supplement thereto and (ii) procedures shall be brought down to a date no more than 3 Business Days prior to the Closing
Date.

 

    	 	21	 

     

    

 

(b)          No
Material Adverse Change or Ratings Agency Change. For the period from and after the date of this Agreement and prior to the
Closing Date:

 

(i)          in
the judgment of the Representative there shall not have occurred any Material Adverse Change that makes it impracticable or inadvisable
to proceed with the offering, sale or delivery of the Securities on the Closing Date on the terms and in the manner contemplated
by this Agreement and in the Pricing Disclosure Package (exclusive of any amendments or supplements thereto after the Time of Sale),
as applicable; and

 

(ii)         there
shall not have occurred any downgrading, nor shall any notice have been given of any intended or potential downgrading or of any
review for a possible change that does not indicate the direction of the possible change, in the rating accorded the Company or
any of its subsidiaries or any of their securities or indebtedness by any “nationally recognized statistical rating organization”
registered under Section 15E of the Exchange Act.

 

(c)          Opinion
of Counsel for the Company. On the Closing Date, the Initial Purchasers shall have received an opinion and letter of K&L
Gates LLP, counsel for the Company, and an opinion of Christopher J. Henderson, General Counsel of the Company, dated as of such
Closing Date in the forms attached as Exhibits A-1, A-2 and A-3, respectively or otherwise in form and substance reasonably
satisfactory to the Representative.

 

(d)          Opinion
of Special FCC Counsel for the Company and Local Counsel. On the Closing Date, the Initial Purchasers shall have received (i)
the favorable opinion of Fletcher, Heald & Hildreth, PLC, special FCC counsel for the Company or such other counsel as is reasonably
satisfactory to the Representative, dated as of the Closing Date in the form attached as Exhibit A-4 or otherwise in form and substance
reasonably satisfactory to the Representative, and (ii) the opinions of local counsel in the jurisdictions of the States of
Colorado, Kentucky, Ohio and Tennessee, each in form and substance reasonably satisfactory to the Representative.

 

(e)          Opinion
of Counsel for the Initial Purchasers. On the Closing Date the Initial Purchasers shall have received the favorable opinion
of Cahill Gordon & Reindel llp, counsel
for the Initial Purchasers, dated as of such Closing Date, with respect to such matters as may be reasonably requested by the Initial
Purchasers.

 

(f)           Officers’
Certificate. On the Closing Date the Initial Purchasers shall have received a written certificate executed by the Chairman
of the Board, Chief Executive Officer or President of the Company and the Chief Financial Officer or Chief Accounting Officer of
the Company, dated as of the Closing Date, to the effect set forth in Section 5(b)(ii) hereof, and further to the effect that:

 

(i)          for
the period from and after the date of this Agreement and prior to the Closing Date there has not occurred any Material Adverse
Change;

 

    	 	22	 

     

    

 

(ii)         the
representations, warranties and covenants of the Company and each Guarantor set forth in Section 1 hereof were true and correct
as of the date hereof and are true and correct as of the Closing Date with the same force and effect as though expressly made on
and as of the Closing Date; and

 

(iii)        the
Company has complied with all the agreements and satisfied all the conditions on its part to be performed or satisfied at or prior
to the Closing Date.

 

(g)          Indenture.
The Company and the Guarantors shall have executed and delivered the Indenture, in form and substance consistent with the Offering
Memorandum, and the Initial Purchasers shall have received executed copies thereof.

 

(h)          Security
Documents and Intercreditor Agreement. The Company and the Guarantors shall have executed and delivered perfection certificates
dated as of the Closing Date (the “Perfection Certificates”) in form and substance reasonably satisfactory to
the Initial Purchasers. Except as otherwise provided for in the Security Agreement, the Indenture or the other documents entered
into pursuant to the Transactions, the Representative and the Collateral Agent shall have received each of the Security Documents
and the Intercreditor Agreement, in form and substance reasonably satisfactory to the Initial Purchasers, and all other certificates,
agreements or instruments necessary to perfect the Collateral Agent’s security interest in all of the Collateral to the extent
required as described in the Offering Memorandum and pursuant to the Security Documents, and each such document shall be in full
force and effect and evidence that all of the liens on the Collateral other than Permitted Liens have been released. The Representative
shall also have received (i) copies of Uniform Commercial Code searches for the Company and each Guarantor and (ii) tax and judgment
lien searches or equivalent reports or searches, and a copy of searches at the United States Patent and Trademark Office for the
Company and each Guarantor to the extent reasonably requested by the Representative, in each case (i) and (ii), as of a recent
date listing all effective financing statements, lien notices or comparable documents that name the Company or any Guarantor as
debtor and that are required by the Perfection Certificates or that the Representative deems reasonably necessary or appropriate,
none of which encumber the Collateral covered or intended to be covered by the Security Documents (other than Permitted Collateral
Liens).

 

(i)           Senior
Credit Facility. The Senior Credit Facility shall have been executed and delivered by the parties thereto, and the initial
borrowings thereunder shall have occurred or shall occur substantially concurrently with the issuance of the Securities.

 

(j)           Additional
Documents. On or before the Closing Date, the Initial Purchasers and counsel for the Initial Purchasers shall have received
such information, documents and opinions as they may reasonably require for the purposes of enabling them to pass upon the issuance
and sale of the Securities as contemplated herein, or in order to evidence the accuracy of any of the representations and warranties,
or the satisfaction of any of the conditions or agreements, herein contained.

 

    	 	23	 

     

    

 

If any condition specified in this Section 5
is not satisfied when and as required to be satisfied, this Agreement may be terminated by the Representative by notice to the
Company at any time on or prior to the Closing Date, which termination shall be without liability on the part of any party to any
other party, except that Sections 4, 6, 8 and 9 hereof shall at all times be effective and shall survive such termination.

 

SECTION 6.        Reimbursement
of Initial Purchasers’ Expenses. If this Agreement is terminated by the Representative pursuant to Section 5 or
10 hereof, including if the sale to the Initial Purchasers of the Securities on the Closing Date is not consummated because of
any refusal, inability or failure on the part of the Company to perform any agreement herein or to comply with any provision hereof,
the Company agrees to reimburse the Initial Purchasers, severally, upon demand for all out-of-pocket expenses that shall have been
reasonably incurred by the Initial Purchasers in connection with the proposed purchase and the offering and sale of the Securities,
including, without limitation, reasonable and documented fees and disbursements of counsel, printing expenses, travel expenses,
postage, facsimile and telephone charges.

 

SECTION 7.        Offer
and Sale Procedures. Each of the Initial Purchasers, on the one hand, and the Company and each of the Guarantors, on the other
hand, hereby agree to observe the following procedures in connection with the offer and sale of the Securities:

 

(a)          Offers
and sales of the Securities will be made only by the Initial Purchasers or Affiliates thereof qualified to do so in the jurisdictions
in which such offers or sales are made. Each such offer or sale shall only be made to persons whom the offeror or seller reasonably
believes to be Qualified Institutional Buyers or non-U.S. persons outside the United States to whom the offeror or seller reasonably
believes offers and sales of the Securities may be made in reliance upon Regulation S upon the terms and conditions set forth in
Annex I hereto, which Annex I is hereby expressly made a part hereof.

 

(b)          No
general solicitation or general advertising (within the meaning of Rule 502 under the Securities Act) will be used in the United
States in connection with the offering of the Securities.

 

(c)          Upon
original issuance by the Company, and until such time as the same is no longer required under the applicable requirements of the
Securities Act, the Notes (and all securities issued in exchange therefor or in substitution thereof) shall bear the following
legend:

 

    	 	24	 

     

    

 

“THE SECURITY (OR ITS PREDECESSOR) EVIDENCED HEREBY
WAS ORIGINALLY ISSUED IN A TRANSACTION EXEMPT FROM REGISTRATION UNDER SECTION 5 OF THE UNITED STATES SECURITIES ACT OF 1933, AS
AMENDED (THE “SECURITIES ACT”), AND THE SECURITY EVIDENCED HEREBY MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED
IN THE ABSENCE OF SUCH REGISTRATION OR AN APPLICABLE EXEMPTION THEREFROM. EACH PURCHASER OF THE SECURITY EVIDENCED HEREBY IS HEREBY
NOTIFIED THAT THE SELLER MAY BE RELYING ON THE EXEMPTION FROM THE PROVISIONS OF SECTION 5 OF THE SECURITIES ACT PROVIDED BY RULE
144A THEREUNDER. THE HOLDER OF THE SECURITY EVIDENCED HEREBY AGREES FOR THE BENEFIT OF THE COMPANY THAT (A) SUCH SECURITY MAY BE
RESOLD, PLEDGED OR OTHERWISE TRANSFERRED, ONLY (1)(a) INSIDE THE UNITED STATES TO A PERSON WHO THE SELLER REASONABLY BELIEVES IS
A QUALIFIED INSTITUTIONAL BUYER (AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT) PURCHASING FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT
OF A QUALIFIED INSTITUTIONAL BUYER IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A UNDER THE SECURITIES ACT, (b) OUTSIDE
THE UNITED STATES TO A FOREIGN PERSON IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 903 OR RULE 904 OF REGULATION S UNDER THE
SECURITIES ACT, (c) PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT PROVIDED BY RULE 144 THEREUNDER (IF APPLICABLE)
OR (d) IN ACCORDANCE WITH ANOTHER EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT (AND BASED UPON AN OPINION
OF COUNSEL ACCEPTABLE TO THE COMPANY IF THE COMPANY SO REQUESTS), (2) TO THE COMPANY OR (3) PURSUANT TO AN EFFECTIVE REGISTRATION
STATEMENT AND, IN EACH CASE, IN ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES OR ANY OTHER APPLICABLE
JURISDICTION AND (B) THE HOLDER WILL, AND EACH SUBSEQUENT HOLDER IS REQUIRED TO, NOTIFY ANY PURCHASER OF THE SECURITY EVIDENCED
HEREBY OF THE RESALE RESTRICTIONS SET FORTH IN CLAUSE (A) ABOVE. NO REPRESENTATION CAN BE MADE AS TO THE AVAILABILITY OF THE EXEMPTION
PROVIDED BY RULE 144 FOR RESALE OF THE SECURITY EVIDENCED HEREBY.”

 

Following the sale of the Securities by
the Initial Purchasers to Subsequent Purchasers pursuant to the terms hereof, the Initial Purchasers shall not be liable or responsible
to the Company for any losses, damages or liabilities suffered or incurred by the Company, including any losses, damages or liabilities
under the Securities Act, arising from or relating to any resale or transfer of any Security.

 

    	 	25	 

     

    

 

SECTION 8.       Indemnification.

 

(a)          Indemnification
of the Initial Purchasers. Each of the Company and the Guarantors, jointly and severally, agrees to indemnify and hold harmless
each Initial Purchaser, its affiliates, directors, officers and employees, and each person, if any, who controls any Initial Purchaser
within the meaning of the Securities Act and the Exchange Act against any loss, claim, damage, liability or expense, as incurred,
to which such Initial Purchaser, affiliate, director, officer, employee or controlling person may become subject, under the Securities
Act, the Exchange Act or other federal or state statutory law or regulation, or at common law or otherwise (including in settlement
of any litigation, if such settlement is effected with the written consent of the Company), insofar as such loss, claim, damage,
liability or expense (or actions in respect thereof as contemplated below) arises out of or is based: (i) upon any untrue
statement or alleged untrue statement of a material fact contained in the Preliminary Offering Memorandum, the Pricing Supplement,
any Company Additional Written Communication or the Final Offering Memorandum (or any amendment or supplement thereto), or the
omission or alleged omission therefrom of a material fact necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading; or (ii) in whole or in part upon any failure of the Company to perform
its obligations hereunder or under law; provided, however, that the foregoing indemnity agreement shall not apply,
with respect to an Initial Purchaser, to any loss, claim, damage, liability or expense to the extent, but only to the extent, arising
out of or based upon any untrue statement or alleged untrue statement or omission or alleged omission made in reliance upon and
in conformity with written information furnished to the Company by such Initial Purchaser through the Representative expressly
for use in the Preliminary Offering Memorandum, the Pricing Supplement, any Company Additional Written Communication or the Final
Offering Memorandum (or any amendment or supplement thereto). The indemnity agreement set forth in this Section 8(a) shall
be in addition to any liabilities that the Company may otherwise have.

 

(b)          Indemnification
of the Company and the Guarantors. Each Initial Purchaser agrees, severally and not jointly, to indemnify and hold harmless
the Company, each Guarantor, each of their respective directors, officers and employees and each person, if any, who controls the
Company or any Guarantor within the meaning of the Securities Act or the Exchange Act, against any loss, claim, damage, liability
or expense, as incurred, to which the Company, any Guarantor or any such director, officer, employee or controlling person may
become subject, under the Securities Act, the Exchange Act, or other federal or state statutory law or regulation, or at common
law or otherwise (including in settlement of any litigation, if such settlement is effected with the written consent of such Initial
Purchaser), insofar as such loss, claim, damage, liability or expense (or actions in respect thereof as contemplated below) arises
out of or is based upon any untrue statement or alleged untrue statement of a material fact contained in the Preliminary Offering
Memorandum, the Pricing Supplement, any Company Additional Written Communication or the Final Offering Memorandum (or any amendment
or supplement thereto), or the omission or alleged omission therefrom of a material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were made, not misleading, in each case to the extent, but only to
the extent, that such untrue statement or alleged untrue statement or omission or alleged omission was made in the Preliminary
Offering Memorandum, the Pricing Supplement, any Company Additional Written Communication or the Final Offering Memorandum (or
any amendment or supplement thereto), in reliance upon and in conformity with written information furnished to the Company by such
Initial Purchaser through the Representative expressly for use therein; and to reimburse the Company, any Guarantor and each such
director, officer, employee or controlling person for any and all expenses (including the fees and disbursements of counsel) as
such expenses are reasonably incurred by the Company, any Guarantor or such director, officer, employee or controlling person in
connection with investigating, defending, settling, compromising or paying any such loss, claim, damage, liability, expense or
action. Each of the Company and the Guarantors hereby acknowledges that, for all purposes under this Agreement, the only information
that the Initial Purchasers through the Representative have furnished to the Company expressly for use in the Preliminary Offering
Memorandum, the Pricing Supplement, any Company Additional Written Communication or the Final Offering Memorandum (or any amendment
or supplement thereto) are the statements set forth in (i) the second sentence of the sixth paragraph, (ii) the seventh paragraph,
(iii) the ninth paragraph and (iv) the fourteenth paragraph under the caption “Plan of Distribution” in the Preliminary
Offering Memorandum and the Final Offering Memorandum. The indemnity agreement set forth in this Section 8(b) shall be in addition
to any liabilities that each Initial Purchaser may otherwise have.

 

    	 	26	 

     

    

 

(c)          Notifications
and Other Indemnification Procedures. Promptly after receipt by an indemnified party under this Section 8 of notice of the
commencement of any action, such indemnified party will, if a claim in respect thereof is to be made against an indemnifying party
under this Section 8, notify the indemnifying party in writing of the commencement thereof, but the omission so to notify the indemnifying
party will not relieve it from any liability which it may have to any indemnified party hereunder for contribution or otherwise
than under the indemnity agreement contained in this Section 8 or to the extent it is not prejudiced (through the forfeiture of
substantive rights and defenses) as a result of such failure and shall not relieve the indemnifying party from any liability that
the indemnifying party may have to an indemnified party otherwise than under the provisions of this Section 8 and Section 9. In
case any such action is brought against any indemnified party and such indemnified party seeks or intends to seek indemnity from
an indemnifying party, the indemnifying party will be entitled to participate in and, to the extent that it shall elect, jointly
with all other indemnifying parties similarly notified, by written notice delivered to the indemnified party promptly after receiving
the aforesaid notice from such indemnified party, to assume the defense thereof with counsel reasonably satisfactory to such indemnified
party; provided, however, if the defendants in any such action include both the indemnified party and the indemnifying
party and the indemnified party shall have reasonably concluded that a conflict may arise between the positions of the indemnifying
party and the indemnified party in conducting the defense of any such action or that there may be legal defenses available to it
and/or other indemnified parties which are different from or additional to those available to the indemnifying party, the indemnified
party or parties shall have the right to select separate counsel to assume such legal defenses and to otherwise participate in
the defense of such action on behalf of such indemnified party or parties. Upon receipt of notice from the indemnifying party to
such indemnified party of such indemnifying party’s election so to assume the defense of such action and approval by the
indemnified party of counsel, the indemnifying party will not be liable to such indemnified party under this Section 8 for any
legal or other expenses subsequently incurred by such indemnified party in connection with the defense thereof unless (i) the indemnified
party shall have employed separate counsel in accordance with the proviso to the next preceding sentence (it being understood,
however, that the indemnifying party shall not be liable for the expenses of more than one separate counsel (together with local
counsel (in each jurisdiction)), approved by the indemnifying party (Wells Fargo Securities, LLC in the case of Sections 8(b)
and 9 hereof), representing the indemnified parties who are parties to such action) or (ii) the indemnifying party shall not have
employed counsel satisfactory to the indemnified party to represent the indemnified party within a reasonable time after notice
of commencement of the action, in each of which cases the fees and expenses of counsel shall be at the expense of the indemnifying
party.

 

    	 	27	 

     

    

 

(d)          Settlements.
The indemnifying party under this Section 8 shall not be liable for any settlement of any proceeding effected without its written
consent, which will not be unreasonably withheld, but if settled with such consent or if there be a final judgment for the plaintiff,
the indemnifying party agrees to indemnify the indemnified party against any loss, claim, damage, liability or expense by reason
of such settlement or judgment. Notwithstanding the foregoing sentence, if at any time an indemnified party shall have requested
an indemnifying party to reimburse the indemnified party for fees and expenses of counsel as contemplated by this Section 8,
the indemnifying party agrees that it shall be liable for any settlement of any proceeding effected without its written consent
if (i) such settlement is entered into more than 30 days after receipt by such indemnifying party of the aforesaid request and
(ii) such indemnifying party shall not have reimbursed the indemnified party in accordance with such request or disputed in good
faith the indemnified party’s entitlement to such reimbursement prior to the date of such settlement. No indemnifying party
shall, without the prior written consent of the indemnified party, effect any settlement, compromise or consent to the entry of
judgment in any pending or threatened action, suit or proceeding in respect of which any indemnified party is or could have been
a party and indemnity was or could have been sought hereunder by such indemnified party, unless such settlement, compromise or
consent (i) includes an unconditional release of such indemnified party from all liability on claims that are the subject matter
of such action, suit or proceeding and (ii) does not include any statements as to or any findings of fault, culpability or failure
to act by or on behalf of any indemnified party.

 

SECTION 9.        Contribution.
If the indemnification provided for in Section 8 hereof is for any reason held to be unavailable to or otherwise insufficient
to hold harmless an indemnified party in respect of any losses, claims, damages, liabilities or expenses referred to therein, then
each indemnifying party shall contribute to the aggregate amount paid or payable by such indemnified party, as incurred, as a result
of any losses, claims, damages, liabilities or expenses referred to therein (i) in such proportion as is appropriate to reflect
the relative benefits received by the Company and the Guarantors, on the one hand, and the Initial Purchasers, on the other hand,
from the offering of the Securities pursuant to this Agreement or (ii) if the allocation provided by clause (i) above is not permitted
by applicable law, in such proportion as is appropriate to reflect not only the relative benefits referred to in clause (i) above
but also the relative fault of the Company and the Guarantors, on the one hand, and the Initial Purchasers, on the other hand,
in connection with the statements or omissions or inaccuracies in the representations and warranties herein which resulted in such
losses, claims, damages, liabilities or expenses, as well as any other relevant equitable considerations. The relative benefits
received by the Company and the Guarantors, on the one hand, and the Initial Purchasers, on the other hand, in connection with
the offering of the Securities pursuant to this Agreement shall be deemed to be in the same respective proportions as the total
net proceeds from the offering of the Securities pursuant to this Agreement (before deducting expenses) received by the Company,
and the total discount received by the Initial Purchasers bear to the aggregate initial offering price of the Securities. The relative
fault of the Company and the Guarantors, on the one hand, and the Initial Purchasers, on the other hand, shall be determined by
reference to, among other things, whether any such untrue or alleged untrue statement of a material fact or omission or alleged
omission to state a material fact or any such inaccurate or alleged inaccurate representation or warranty relates to information
supplied by the Company and the Guarantors, on the one hand, or the Initial Purchasers, on the other hand, and the parties’
relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission or inaccuracy.

 

    	 	28	 

     

    

 

The amount paid or payable by a party as
a result of the losses, claims, damages, liabilities and expenses referred to above shall be deemed to include, subject to the
limitations set forth in Section 8 hereof, any legal or other fees or expenses reasonably incurred by such party in connection
with investigating or defending any action or claim. The provisions set forth in Section 8 hereof with respect to notice of
commencement of any action shall apply if a claim for contribution is to be made under this Section 9; provided, however,
that no additional notice shall be required with respect to any action for which notice has been given under Section 8 hereof
for purposes of indemnification.

 

The Company, the Guarantors and the Initial
Purchasers agree that it would not be just and equitable if contribution pursuant to this Section 9 were determined by pro rata
allocation (even if the Initial Purchasers were treated as one entity for such purpose) or by any other method of allocation which
does not take account of the equitable considerations referred to in this Section 9.

 

Notwithstanding the provisions of this Section
9, no Initial Purchaser shall be required to contribute any amount in excess of the discount received by such Initial Purchaser
in connection with the Securities distributed by it. No person guilty of fraudulent misrepresentation (within the meaning of Section
11 of the Securities Act) shall be entitled to contribution from any person who was not guilty of such fraudulent misrepresentation.
The Initial Purchasers’ obligations to contribute pursuant to this Section 9 are several, and not joint, in proportion to
their respective commitments as set forth opposite their names in Schedule A. For purposes of this Section 9, each affiliate, director,
officer and employee of an Initial Purchaser and each person, if any, who controls an Initial Purchaser within the meaning of the
Securities Act and the Exchange Act shall have the same rights to contribution as such Initial Purchaser, and each director and
officer of the Company or any Guarantor, and each person, if any, who controls the Company or any Guarantor with the meaning of
the Securities Act and the Exchange Act shall have the same rights to contribution as the Company and the Guarantors.

 

SECTION 10.      Termination
of this Agreement. Prior to the Closing Date, this Agreement may be terminated by Wells Fargo Securities, LLC by notice given
to the Company if at any time: (i) trading or quotation in any of the Company’s securities shall have been suspended or limited
by the Commission or by the Nasdaq Global Market, or trading in securities generally on either the Nasdaq Stock Market or the New
York Stock Exchange shall have been suspended or limited, or minimum or maximum prices shall have been generally established on
any of such quotation system or stock exchange by the Commission or FINRA; (ii) a general banking moratorium shall have been declared
by any of federal, New York or Delaware authorities; (iii) there shall have occurred any outbreak or escalation of national or
international hostilities or any crisis or calamity, or any change in the United States or international financial markets, or
any substantial change or development involving a prospective substantial change in United States’ or international political,
financial or economic conditions, as in the judgment of Wells Fargo Securities, LLC is material and adverse and makes it impracticable
or inadvisable to proceed with the offering, sale or delivery of the Securities in the manner and on the terms described in the
Pricing Disclosure Package or to enforce contracts for the sale of securities; (iv) in the judgment of Wells Fargo Securities,
LLC there shall have occurred any Material Adverse Change; or (v) the Company shall have sustained a loss by strike, fire, flood,
earthquake, accident or other calamity of such character as in the judgment of Wells Fargo Securities, LLC interferes materially
with the conduct of the business and operations of the Company regardless of whether or not such loss shall have been insured.
Any termination pursuant to this Section 10 shall be without liability on the part of (i) the Company or any Guarantor to any Initial
Purchaser, except that the Company and the Guarantors shall be obligated to reimburse the expenses of the Initial Purchasers pursuant
to Sections 4 and 6 hereof, (ii) any Initial Purchaser to the Company, or (iii) any party hereto to any other party except
that the provisions of Sections 8 and 9 hereof shall at all times be effective and shall survive such termination.

 

    	 	29	 

     

    

 

SECTION 11.      Representations
and Indemnities to Survive Delivery. The respective indemnities, agreements, representations, warranties and other statements
of the Company, the Guarantors, their respective officers and the several Initial Purchasers set forth in or made pursuant to this
Agreement will remain in full force and effect, regardless of any investigation made by or on behalf of any Initial Purchaser,
the Company, any Guarantor or any of their partners, officers or directors or any controlling person, as the case may be, and will
survive delivery of and payment for the Securities sold hereunder and any termination of this Agreement.

 

SECTION 12.      Notices.
All communications hereunder shall be in writing and shall be mailed, hand delivered, couriered or facsimiled and confirmed to
the parties hereto as follows:

 

If to the Initial Purchasers:

 

Wells Fargo Securities, LLC

550 S. Tryon Street, 5th
Floor

Charlotte, North Carolina 28202

		Facsimile:	(704) 410-4874

		Attention:	High Yield Syndicate

 

with a copy to:

 

Cahill Gordon & Reindel llp

80 Pine Street

New York, NY 10005

		Facsimile:	(212) 269-5420

		Attention:	James J. Clark, Esq.

			Michael Ohler, Esq.

 

If to the Company or the Guarantors:

 

Salem Media Group, Inc.

4880 Santa Rosa Road

Camarillo, CA 93012

		Facsimile:	(805) 384-4505

		Attention:	Christopher J. Henderson, General Counsel

 

    	 	30	 

     

    

 

with a copy to:

 

K&L Gates LLP

1 Park Plaza, 12th Floor

Irvine, CA 92614

		Facsimile:	(949) 623-4508

		Attention:	David C. Lee

 

Any party hereto may change the address
or facsimile number for receipt of communications by giving written notice to the others.

 

SECTION 13.      Successors.
This Agreement will inure to the benefit of and be binding upon the parties hereto, and to the benefit of the indemnified parties
referred to in Sections 8 and 9 hereof, and in each case their respective successors, and no other person will have any right
or obligation hereunder. The term “successors” shall not include any Subsequent Purchaser or other purchaser of the
Securities as such from any of the Initial Purchasers merely by reason of such purchase.

 

SECTION 14.      Authority
of Wells Fargo Securities, LLC. Any action by the Initial Purchasers hereunder may be taken by Wells Fargo Securities, LLC
on behalf of the Initial Purchasers, and any such action taken by Wells Fargo Securities, LLC shall be binding upon the Initial
Purchasers.

 

SECTION 15.      Partial
Unenforceability. The invalidity or unenforceability of any section, paragraph or provision of this Agreement shall not affect
the validity or enforceability of any other section, paragraph or provision hereof. If any section, paragraph or provision of this
Agreement is for any reason determined to be invalid or unenforceable, there shall be deemed to be made such minor changes (and
only such minor changes) as are necessary to make it valid and enforceable.

 

SECTION 16.      Governing
Law Provisions and Consent to Jurisdiction. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE INTERNAL
LAWS OF THE STATE OF NEW YORK APPLICABLE TO AGREEMENTS MADE AND TO BE PERFORMED IN SUCH STATE WITHOUT REGARD TO CONFLICTS OF LAW
PRINCIPLES THEREOF.

 

Any legal suit, action or proceeding arising
out of or based upon this Agreement or the transactions contemplated hereby (“Related Proceedings”) may be instituted
in the federal courts of the United States of America located in the City and County of New York or the courts of the State of
New York in each case located in the City and County of New York (collectively, the “Specified Courts”), and
each party irrevocably submits to the exclusive jurisdiction (except for suits, actions, or proceedings instituted in regard to
the enforcement of a judgment of any Specified Court in a Related Proceeding, as to which such jurisdiction is non-exclusive) of
the Specified Courts in any Related Proceeding. Service of any process, summons, notice or document by mail to such party’s
address set forth above shall be effective service of process for any Related Proceeding brought in any Specified Court. The parties
irrevocably and unconditionally waive any objection to the laying of venue of any Related Proceeding in the Specified Courts and
irrevocably and unconditionally waive and agree not to plead or claim in any Specified Court that any Related Proceeding brought
in any Specified Court has been brought in an inconvenient forum.

 

    	 	31	 

     

    

 

SECTION 17.      Default
of One or More of the Several Initial Purchasers. If any one or more of the several Initial Purchasers shall fail or refuse
to purchase Securities that it or they have agreed to purchase hereunder on the Closing Date, and the aggregate number of Securities
which such defaulting Initial Purchaser or Initial Purchasers agreed but failed or refused to purchase does not exceed 10% of the
aggregate number of the Securities to be purchased on such date, the other Initial Purchasers shall be obligated, severally, in
the proportions that the number of Securities set forth opposite their respective names on Schedule A bears to the aggregate number
of Securities set forth opposite the names of all such non-defaulting Initial Purchasers, or in such other proportions as may be
specified by the Initial Purchasers with the consent of the non-defaulting Initial Purchasers, to purchase the Securities which
such defaulting Initial Purchaser or Initial Purchasers agreed but failed or refused to purchase on the Closing Date. If any one
or more of the Initial Purchasers shall fail or refuse to purchase Securities and the aggregate number of Securities with respect
to which such default occurs exceeds 10% of the aggregate number of Securities to be purchased on the Closing Date, and arrangements
satisfactory to the Initial Purchasers and the Company for the purchase of such Securities are not made within 48 hours after such
default, this Agreement shall terminate without liability of any non-defaulting party except that the provisions of Sections 4,
6, 8 and 9 hereof shall at all times be effective and shall survive such termination. In any such case either the Initial Purchasers
or the Company shall have the right to postpone the Closing Date, as the case may be, but in no event for longer than seven days
in order that the required changes, if any, to the Final Offering Memorandum or any other documents or arrangements may be effected.

 

As used in this Agreement, the term “Initial
Purchaser” shall be deemed to include any person substituted for a defaulting Initial Purchaser under this Section 17.
Any action taken under this Section 17 shall not relieve any defaulting Initial Purchaser from liability in respect of any default
of such Initial Purchaser under this Agreement.

 

SECTION 18.      No
Advisory or Fiduciary Responsibility. Each of the Company and the Guarantors acknowledges and agrees that: (i) the purchase
and sale of the Securities pursuant to this Agreement, including the determination of the offering price of the Securities and
any related discounts and commissions, is an arm’s-length commercial transaction between the Company and the Guarantors,
on the one hand, and the several Initial Purchasers, on the other hand, and the Company and the Guarantors are capable of evaluating
and understanding and understand and accept the terms, risks and conditions of the transactions contemplated by this Agreement;
(ii) in connection with each transaction contemplated hereby and the process leading to such transaction each Initial Purchaser
is and has been acting solely as a principal and is not the agent or fiduciary of the Company, Guarantors or their respective affiliates,
stockholders, creditors or employees or any other party; (iii) no Initial Purchaser has assumed or will assume an advisory
or fiduciary responsibility in favor of the Company or any Guarantor with respect to any of the transactions contemplated hereby
or the process leading thereto (irrespective of whether such Initial Purchaser has advised or is currently advising the Company
or any Guarantor on other matters) or any other obligation to the Company and the Guarantors except the obligations expressly set
forth in this Agreement; (iv) the several Initial Purchasers and their respective affiliates may be engaged in a broad range of
transactions that involve interests that differ from those of the Company and the Guarantors and that the several Initial Purchasers
have no obligation to disclose any of such interests by virtue of any fiduciary or advisory relationship; and (v) the Initial Purchasers
have not provided any legal, accounting, regulatory or tax advice with respect to the offering contemplated hereby and the Company
and the Guarantors have consulted their own legal, accounting, regulatory and tax advisors to the extent they deemed appropriate.

 

    	 	32	 

     

    

 

This Agreement supersedes all prior agreements
and understandings (whether written or oral) between the Company, the Guarantors and the several Initial Purchasers, or any of
them, with respect to the subject matter hereof. The Company and the Guarantors hereby waive and release, to the fullest extent
permitted by law, any claims that the Company and the Guarantors may have against the several Initial Purchasers with respect to
any breach or alleged breach of fiduciary duty.

 

SECTION 19.      General
Provisions. This Agreement constitutes the entire agreement of the parties to this Agreement and supersedes all prior written
or oral and all contemporaneous oral agreements, understandings and negotiations with respect to the subject matter hereof. This
Agreement may be executed in two or more counterparts, each one of which shall be an original, with the same effect as if the signatures
thereto and hereto were upon the same instrument. Delivery of an executed counterpart of a signature page to this Agreement by
telecopier, facsimile or other electronic transmission (i.e., a “pdf” or “tif”) shall be effective as delivery
of a manually executed counterpart thereof. This Agreement may not be amended or modified unless in writing by all of the parties
hereto, and no condition herein (express or implied) may be waived unless waived in writing by each party whom the condition is
meant to benefit. The section headings herein are for the convenience of the parties only and shall not affect the construction
or interpretation of this Agreement.

 

SECTION 20.      Waiver
of Jury Trial. Each of the parties hereto hereby irrevocably waives, to the fullest extent permitted by applicable law, any
and all right to trial by jury in any legal proceeding arising out of or relating to this Agreement or the transactions contemplated
hereby.

 

    	 	33	 

     

    

 

If the foregoing is in accordance with your
understanding of our agreement, kindly sign and return to the Company the enclosed copies hereof, whereupon this instrument, along
with all counterparts hereof, shall become a binding agreement in accordance with its terms.

 

Very truly yours,

 

	 	SALEM MEDIA GROUP, INC.
	 	 	 
	 	By:	/s/ Christopher J. Henderson
	 	 	Name: Christopher J. Henderson
	 	 	Title: Senior Vice President, General Counsel and Secretary
	 	 	 
	 	EAGLE PRODUCTS, LLC
	 	 	 
	 	as a Guarantor
	 	By:	CARON BROADCASTING, INC.,
	 	 	as Managing Member
	 	 	 
	 	By:	/s/ Christopher J. Henderson
	 	 	Name: Christopher J. Henderson
	 	 	Title: Senior Vice President, General Counsel and Secretary
	 	 	 
	 	INSPIRATION MEDIA OF TEXAS, LLC
	 	SALEM MEDIA OF ILLINOIS, LLC
	 	SALEM MEDIA OF MASSACHUSETTS, LLC
	 	SALEM MEDIA OF NEW YORK, LLC
	 	SALEM RADIO OPERATIONS, LLC
	 	SALEM SATELLITE MEDIA, LLC
	 	SALEM WEB NETWORK, LLC
	 	SCA-PALO ALTO, LLC
	 	 	 
	 	as Guarantors
	 	By:	SCA LICENSE CORPORATION,
	 	 	as Managing Member
	 	 	 
	 	By:	/s/ Christopher J. Henderson
	 	 	Name: Christopher J. Henderson
	 	 	Title: Senior Vice President, General Counsel and Secretary

 

[Signature Page to Purchase Agreement]

 

     

     

    

 

	 	AIR HOT, INC.
	 	BISON MEDIA, INC.
	 	CARON BROADCASTING, INC.
	 	COMMON GROUND BROADCASTING, INC.
	 	INSPIRATION MEDIA, INC.
	 	NEW INSPIRATION BROADCASTING COMPANY, INC.
	 	NI ACQUISITION CORP.
	 	PENNSYLVANIA MEDIA ASSOCIATES, INC.
	 	REACH SATELLITE NETWORK, INC.
	 	SALEM CONSUMER PRODUCTS, INC.
	 	SALEM COMMUNICATIONS HOLDING CORPORATION
	 	SALEM MEDIA OF COLORADO, INC.
	 	SALEM MEDIA OF HAWAII, INC.
	 	SALEM MEDIA OF KENTUCKY, INC.
	 	SALEM MEDIA OF OHIO, INC.
	 	SALEM MEDIA OF OREGON, INC.
	 	SALEM MEDIA OF TEXAS, INC.
	 	SALEM MEDIA OF VIRGINIA, INC.
	 	SALEM MEDIA REPRESENTATIVES, INC.
	 	SALEM PUBLISHING, INC.
	 	SALEM RADIO NETWORK INCORPORATED
	 	SALEM RADIO PROPERTIES, INC.
	 	SCA LICENSE CORPORATION
	 	SOUTH TEXAS BROADCASTING, INC.
	 	SRN NEWS NETWORK, INC.
	 	SRN STORE, INC.
	 	 	 
	 	as Guarantors
	 	 	 
	 	By:	/s/ Christopher J. Henderson
	 	 	Name: Christopher J. Henderson
	 	 	Title: Senior Vice President, General Counsel and Secretary

 

[Signature Page to Purchase Agreement]

 

     

     

    

 

The foregoing Purchase Agreement is hereby
confirmed and accepted by the Initial Purchasers as of the date first above written.

 

Wells Fargo Securities,
LLC

Acting on behalf of itself

and as the Representative of

the several Initial Purchasers

 

	By:	/s/ Peter Daniel	 
	 	Name: Peter Daniel	 
	 	Title: Managing Director	 

 

[Signature Page to Purchase Agreement]

 

     

     

    

 

SCHEDULE
A

 

	Initial Purchasers	 	Aggregate
 Principal
 Amount of
 Securities to be
 Purchased	 
	Wells Fargo Securities, LLC	 	$	209,230,769	 
	Barclays Capital Inc.	 	$	39,230,769	 
	Noble Capital Market, Inc.	 	$	6,538,462	 
	 	 	 	 	 
	Total	 	$	255,000,000	 

 

     

     

    

 

SCHEDULE B

 

		1.	California

		2.	Colorado

		3.	Delaware

		4.	Kentucky

		5.	Ohio

		6.	Oregon

		7.	Pennsylvania

		8.	Tennessee

		9.	Texas

		10.	Virginia

		11.	Washington

 

     

     

    

 

EXHIBIT A-1

 

[Form of opinion of K&L
Gates LLP to be delivered pursuant to Section 5 of the Purchase Agreement]

 

     

     

    

 

EXHIBIT A-2

 

[Form of negative assurance
letter from K&L Gates LLP to be delivered pursuant to Section 5 of the Purchase Agreement]

 

     

     

    

 

EXHIBIT A-3

 

[Form of opinion of general
counsel of the Company to be delivered pursuant to Section 5 of the Purchase Agreement]

 

     

     

    

 

EXHIBIT A-4

 

[Form of opinion of Fletcher, Heald &
Hildreth, PLC to be delivered pursuant to Section 5(d) of the Purchase Agreement]

 

     

     

    

 

EXHIBIT A

SALEM STATION LIST

(Sorted by Call Sign)

 

	Station	 	Fac. ID	 	Community	 	Licensee
	KAIM-FM	 	10950	 	HONOLULU, HI	 	SALEM MEDIA OF HAWAII, INC.
	KBIQ(FM)	 	73073	 	MANITOU SPRINGS, CO	 	BISON MEDIA, INC.
	KBJD(AM)	 	87151	 	DENVER, CO	 	SALEM MEDIA OF COLORADO, INC.*
	KCBQ(AM)	 	13509	 	SAN DIEGO, CA	 	NEW INSPIRATION BROADCASTING COMPANY, INC.
	KCRO(AM)	 	54902	 	OMAHA, NE	 	SALEM MEDIA OF ILLINOIS, LLC
	KDAR(FM)	 	3077	 	OXNARD, CA	 	NEW INSPIRATION BROADCASTING COMPANY, INC.
	KDIS(FM)	 	47309	 	LITTLE ROCK, AR	 	SOUTH TEXAS BROADCASTING, INC.
	KDIZ(AM)	 	10828	 	GOLDEN VALLEY, MN	 	COMMON GROUND BROADCASTING, INC.
	KDMT(AM)	 	86619	 	ARVADA, CO	 	SALEM MEDIA OF COLORADO, INC.
	KDOW(AM)	 	65485	 	PALO ALTO, CA	 	SCA-PALO ALTO, LLC
	KDZR(AM)	 	86618	 	LAKE OSWEGO, OR	 	SALEM MEDIA OF OREGON, INC.
	KEXB(AM)	 	49320	 	PLANO, TX	 	INSPIRATION MEDIA OF TEXAS, LLC
	KFAX(AM)	 	24510	 	SAN FRANCISCO, CA	 	NEW INSPIRATION BROADCASTING COMPANY, INC.
	KFIA(AM)	 	50300	 	CARMICHAEL, CA	 	NEW INSPIRATION BROADCASTING COMPANY, INC.
	KFIS(FM)	 	50553	 	SCAPPOOSE, OR	 	CARON BROADCASTING, INC.
	KFSH-FM	 	2195	 	LA MIRADA, CA	 	NEW INSPIRATION BROADCASTING COMPANY, INC.
	KGBI-FM	 	24713	 	OMAHA, NE	 	PENNSYLVANIA MEDIA ASSOCIATES, INC.

 

     

     

    

 

	Station	 	Fac. ID	 	Community	 	Licensee
	KGFT(FM)	 	20579	 	PUEBLO, CO	 	BISON MEDIA, INC.
	KGNW(AM)	 	28819	 	BURIEN-SEATTLE, WA	 	INSPIRATION MEDIA, INC.
	KGU(AM)	 	53705	 	HONOLULU, HI	 	SALEM MEDIA OF HAWAII, INC.
	KGU-FM	 	641	 	HONOLULU, HI	 	SALEM MEDIA OF HAWAII, INC.
	KHCM(AM)	 	10934	 	HONOLULU, HI	 	SALEM MEDIA OF HAWAII, INC.
	KHCM-FM	 	34620	 	HONOLULU, HI	 	SALEM MEDIA OF HAWAII, INC.
	KHNR(AM)	 	16742	 	HONOLULU, HI	 	SALEM MEDIA OF HAWAII, INC.
	KHTE(FM)	 	40746	 	ENGLAND, AR	 	CRAIN MEDIA GROUP, LLC – OPERATED BY SOUTH TEXAS BROADCASTING, INC.
	KKFS(FM)	 	56366	 	LINCOLN, CA	 	NEW INSPIRATION BROADCASTING COMPANY, INC.
	KKHT-FM	 	57801	 	LUMBERTON, TX	 	SALEM MEDIA OF ILLINOIS, LLC
	KKLA-FM	 	48453	 	LOS ANGELES, CA	 	NEW INSPIRATION BROADCASTING COMPANY, INC.
	KKMS(AM)	 	18518	 	RICHFIELD, MN	 	COMMON GROUND BROADCASTING, INC.
	KKNT(AM)	 	13508	 	PHOENIX, AZ	 	COMMON GROUND BROADCASTING, INC.
	KKOL(AM)	 	20355	 	SEATTLE, WA	 	INSPIRATION MEDIA, INC.**
	KKOL-FM	 	70384	 	AIEA, HI	 	SALEM MEDIA OF HAWAII, INC.
	KKSP(FM)	 	39751	 	BRYANT, AR	 	SOUTH TEXAS BROADCASTING, INC.
	KLFE(AM)	 	12031	 	SEATTLE, WA	 	INSPIRATION MEDIA, INC.*
	KLTY(FM)	 	2809	 	ARLINGTON, TX	 	INSPIRATION MEDIA OF TEXAS, LLC
	KLUP(AM)	 	34975	 	TERRELL HILLS, TX	 	SOUTH TEXAS BROADCASTING, INC.
	KNTH(AM)	 	61174	 	HOUSTON, TX	 	SOUTH TEXAS BROADCASTING, INC.

 

     

     

    

 

	Station	 	Fac. ID	 	Community	 	Licensee
	KNTS(AM)	 	87153	 	SEATTLE, WA	 	INSPIRATION MEDIA, INC.*
	KNUS(AM)	 	42377	 	DENVER, CO	 	SALEM MEDIA OF COLORADO, INC.
	KOTK(AM)	 	50307	 	OMAHA, NE	 	PENNSYLVANIA MEDIA ASSOCIATES, INC.
	KPDQ(AM)	 	58628	 	PORTLAND, OR	 	SALEM MEDIA OF OREGON, INC.
	KPDQ-FM	 	58629	 	PORTLAND, OR	 	SALEM MEDIA OF OREGON, INC.
	KPRZ(AM)	 	54461	 	SAN MARCOS-POWAY, CA	 	NEW INSPIRATION BROADCASTING COMPANY, INC.
	KPXQ(AM)	 	55912	 	GLENDALE, AZ	 	COMMON GROUND BROADCASTING, INC.
	KRDY(AM)	 	26310	 	SAN ANTONIO, TX	 	SOUTH TEXAS BROADCASTING, INC.
	KRKS(AM)	 	58632	 	DENVER, CO	 	SALEM MEDIA OF COLORADO, INC.*
	KRKS-FM	 	58631	 	LAFAYETTE, CO	 	SALEM MEDIA OF COLORADO, INC.
	KRLA(AM)	 	61267	 	GLENDALE, CA	 	NEW INSPIRATION BROADCASTING COMPANY, INC.
	KRYP(FM)	 	82062	 	GLADSTONE, OR	 	SALEM MEDIA OF OREGON, INC.
	KSAC-FM	 	51220	 	DUNNIGAN, CA	 	CARON BROADCASTING, INC.
	KSKY(AM)	 	6591	 	BALCH SPRINGS, TX	 	BISON MEDIA, INC.
	KSLR(AM)	 	58634	 	SAN ANTONIO, TX	 	SALEM MEDIA OF TEXAS, INC.
	KTEK(AM)	 	10827	 	ALVIN, TX	 	SOUTH TEXAS BROADCASTING, INC.
	KTIE(AM)	 	58808	 	SAN BERNARDINO, CA	 	CARON BROADCASTING, INC.
	KTKZ(AM)	 	59599	 	SACRAMENTO, CA	 	NEW INSPIRATION BROADCASTING COMPANY, INC.
	KTNO(AM)	 	34562	 	UNIVERSITY PARK, TX	 	INSPIRATION MEDIA OF TEXAS, LLC

 

     

     

    

 

	Station	 	Fac. ID	 	Community	 	Licensee
	KTRB(AM)	 	66246	 	SAN FRANCISCO, CA	 	EAST BAY BROADCASTING, LLC – OPERATED BY NEW INSPIRATION BROADCASTING COMPANY, INC.
	KWRD-FM	 	6560	 	HIGHLAND VILLAGE, TX	 	INSPIRATION MEDIA OF TEXAS, LLC
	KXFN(AM)	 	74579	 	ST. LOUIS, MO	 	CARON BROADCASTING, INC.
	KXXT(AM)	 	54742	 	TOLLESON, AZ	 	COMMON GROUND BROADCASTING, INC.
	KYCR(AM)	 	35504	 	GOLDEN VALLEY, MN	 	COMMON GROUND BROADCASTING, INC.
	KZNT(AM)	 	70825	 	COLORADO SPRINGS, CO	 	BISON MEDIA, INC.
	WAFS(AM)	 	72111	 	ATLANTA, GA	 	SOUTH TEXAS BROADCASTING, INC.
	WAVA(AM)	 	54465	 	ARLINGTON, VA	 	SALEM MEDIA OF VIRGINIA, INC.
	WAVA-FM	 	4644	 	ARLINGTON, VA	 	SALEM MEDIA OF VIRGINIA, INC.
	WBIX(AM)	 	48403	 	BOSTON, MA	 	PENNSYLVANIA MEDIA ASSOCIATES, INC.
	WBOZ(FM)	 	15531	 	WOODBURY, TN	 	REACH SATELLITE NETWORK, INC.
	WBZW(AM)	 	1185	 	APOPKA, FL	 	PENNSYLVANIA MEDIA ASSOCIATES, INC.
	WDTK(AM)	 	68641	 	 DETROIT, MI	 	PENNSYLVANIA MEDIA ASSOCIATES, INC.
	WDWD (AM)	 	8623	 	ALTANTA, GA	 	SOUTH TEXAS BROADCASTING, INC.
	WDYZ(AM)	 	23442	 	ORLANDO, FL	 	PENNSYLVANIA MEDIA ASSOCIATES, INC.
	WEZE(AM)	 	3594	 	BOSTON, MA	 	PENNSYLVANIA MEDIA ASSOCIATES, INC.
	WFFH(FM)	 	68347	 	SMYRNA, TN	 	CARON BROADCASTING, INC.
	WFFI(FM)	 	18714	 	KINGSTON SPRINGS, TN	 	CARON BROADCASTING, INC.
	WFHM-FM	 	54778	 	CLEVELAND, OH	 	SALEM MEDIA OF MASSACHUSETTS, LLC

 

     

     

    

 

	Station	 	Fac. ID	 	Community	 	Licensee
	WFIA-FM	 	48371	 	NEW ALBANY, IN	 	SALEM MEDIA OF KENTUCKY, INC.
	WFIL(AM)	 	52193	 	PHILADELPHIA, PA	 	PENNSYLVANIA MEDIA ASSOCIATES, INC.
	WFSH-FM	 	56390	 	ATHENS, GA	 	SOUTH TEXAS BROADCASTING, INC.
	WGKA(AM)	 	65976	 	ATLANTA, GA	 	PENNSYLVANIA MEDIA ASSOCIATES, INC.
	WGTK(AM)	 	63936	 	LOUISVILLE, KY	 	SALEM MEDIA OF KENTUCKY, INC.
	WGTK-FM	 	73296	 	GREENVILLE, SC	 	CARON BROADCASTING, INC.
	WGUL(AM)	 	1177	 	DUNEDIN, FL	 	CARON BROADCASTING, INC.
	WHIM(AM)	 	74165	 	CORAL GABLES, FL	 	CARON BROADCASTING, INC.
	WHK(AM)	 	72299	 	CLEVELAND, OH	 	COMMON GROUND BROADCASTING, INC.
	WHKW(AM)	 	14772	 	CLEVELAND, OH	 	CARON BROADCASTING, INC.
	WHKZ(AM)	 	57235	 	WARREN, OH	 	SALEM MEDIA OF MASSACHUSETTS, LLC
	WIND(AM)	 	67068	 	CHICAGO, IL	 	SALEM MEDIA OF ILLINOIS, LLC
	WJIE(AM)	 	55504	 	LOUISVILLE, KY	 	SALEM MEDIA OF MASSACHUSETTS, LLC
	WKAT(AM)	 	27713	 	NORTH MIAMI, FL	 	CARON BROADCASTING, INC.
	WLCC(AM)	 	71212	 	BRANDON, FL	 	SOUTH TEXAS BROADCASTING, INC.
	WLQV(AM)	 	42081	 	DETROIT, MI	 	CARON BROADCASTING, INC.
	WLSS(AM)	 	59126	 	SARASOTA, FL	 	CARON BROADCASTING, INC.
	WLTA(AM)	 	42660	 	ALPHARETTA, GA	 	SOUTH TEXAS BROADCASTING, INC.
	WLTE-FM	 	170949	 	PENDLETON, SC	 	CARON BROADCASTING, INC.
	WMCA(AM)	 	58626	 	NEW YORK, NY	 	SALEM MEDIA OF NEW YORK, LLC

 

     

     

    

 

	Station	 	Fac. ID	 	Community	 	Licensee
	WNIV(AM)	 	23607	 	ATLANTA, GA	 	SOUTH TEXAS BROADCASTING, INC.
	WNTP(AM)	 	52194	 	PHILADELPHIA, PA	 	PENNSYLVANIA MEDIA ASSOCIATES, INC.
	WNYM(AM)	 	58635	 	HACKENSACK, NJ	 	SALEM MEDIA OF NEW YORK, LLC
	WOCN(AM)	 	43034	 	MIAMI, FL	 	CARON BROADCASTING, INC.
	WORD-FM	 	58627	 	PITTSBURGH, PA	 	PENNSYLVANIA MEDIA ASSOCIATES, INC.
	WORL(AM)	 	21810	 	ALTAMONTE SPRINGS, FL	 	SALEM MEDIA OF ILLINOIS, LLC
	WPGP(AM)	 	65691	 	PITTSBURGH, PA	 	PENNSYLVANIA MEDIA ASSOCIATES, INC.
	WPIT(AM)	 	58624	 	PITTSBURGH, PA	 	PENNSYLVANIA MEDIA ASSOCIATES, INC.
	WRCW(AM)	 	53368	 	WARRENTON, VA	 	SALEM MEDIA OF VIRGINIA, INC.
	WRFD(AM)	 	58630	 	COLUMBUS-WORTHINGTON, OH	 	SALEM MEDIA OF OHIO, INC.
	WROL(AM)	 	9139	 	BOSTON, MA	 	SALEM MEDIA OF MASSACHUSETTS, LLC
	WRTH(FM)	 	73241	 	GREENVILLE, SC	 	CARON BROADCASTING, INC.
	WSDZ(AM)	 	4622	 	BELLEVILLE, IL	 	CARON BROADCASTING, INC.
	WTBN(AM)	 	51985	 	PINELLAS PARK, FL	 	COMMON GROUND BROADCASTING, INC.
	WTLN(AM)	 	48731	 	ORLANDO, FL	 	PENNSYLVANIA MEDIA ASSOCIATES, INC.
	WTOH-FM	 	73972	 	UPPER ARLINGTON, OH	 	SALEM MEDIA OF OHIO, INC.
	WTWD(AM)	 	26145	 	PLANT CITY, FL	 	SOUTH TEXAS BROADCASTING, INC.
	WWDJ(AM)	 	25051	 	BOSTON, MA	 	PENNSYLVANIA MEDIA ASSOCIATES, INC.
	WWMI(AM)	 	11954	 	ST. PETERSBURG, FL	 	SOUTH TEXAS BROADCASTING, INC.
	WWRC(AM)	 	8681	 	WASHINGTON, DC	 	SALEM MEDIA OF VIRGINIA, INC.
	WWTC(AM)	 	9676	 	MINNEAPOLIS, MN	 	SALEM MEDIA OF MASSACHUSETTS, LLC
	WYLL(AM)	 	28630	 	CHICAGO, IL	 	SALEM MEDIA OF MASSACHUSETTS, LLC
	WZAB(AM)	 	21763	 	SWEETWATER, FL	 	CARON BROADCASTING, INC.

 

     

     

    

 

*KBJD and KRKS, Denver, CO, are paired AM stations, KBJD in
the AM expanded band and KRKS in the existing AM band. KNTS and KLFE, Seattle, WA, are related in the same way. It is likely that
at a future date, presently not predictable, the Salem subsidiary licensees will be required to dispose of one station of each
pair. Because of this relationship, the KBJD and KRKS license renewal applications have remained in pending status. The KNTS and
KLFE license renewal applications were granted, but with a condition on each license potentially limiting its duration to less
than a full license term.

 

**A petition for reconsideration of the grant in January 2007,
of a license to cover the construction of new broadcast transmission facilities for KKOL(AM), Seattle, WA, was filed by U.S. Oil
and Refining Co. That petition was opposed by KKOL’s licensee, Inspiration Media, Inc. (“Inspiration”). Inspiration
and the petitioner entered into a settlement agreement, pursuant to which a minor modification will be made to the transmission
facilities as initially licensed. The settlement agreement has been submitted to the FCC for its approval, which is pending. No
objection to the settlement has been filed with the FCC.

 

     

     

    

 

ANNEX I

 

Resale Pursuant to Regulation S or Rule
144A. Each Initial Purchaser understands that:

 

Such Initial Purchaser agrees that it has
not offered or sold and will not offer or sell the Securities in the United States or to, or for the benefit or account of, a U.S.
Person (other than a distributor), in each case, as defined in Rule 902 of Regulation S (i) as part of its distribution
at any time and (ii) otherwise until 40 days after the later of the commencement of the offering of the Securities pursuant hereto
and the Closing Date, other than in accordance with Regulation S or another exemption from the registration requirements of
the Securities Act. Such Initial Purchaser agrees that, during such 40-day restricted period, it will not cause any advertisement
with respect to the Securities (including any “tombstone” advertisement) to be published in any newspaper or periodical
or posted in any public place and will not issue any circular relating to the Securities, except such advertisements as are permitted
by and include the statements required by Regulation S.

 

Such Initial Purchaser agrees that, at or
prior to confirmation of a sale of Securities by it to any distributor, dealer or person receiving a selling concession, fee or
other remuneration during the 40-day restricted period referred to in Rule 903 of Regulation S, it will send to such
distributor, dealer or person receiving a selling concession, fee or other remuneration a confirmation or notice to substantially
the following effect:

 

“The Securities covered hereby have not been
registered under the U.S. Securities Act of 1933, as amended (the “Securities Act”), and may not be offered and sold
within the United States or to, or for the account or benefit of, U.S. persons (i) as part of your distribution at any time or
(ii) otherwise until 40 days after the later of the date the Securities were first offered to persons other than distributors in
reliance upon Regulation S and the Closing Date, except in either case in accordance with Regulation S under the Securities
Act (or in accordance with Rule 144A under the Securities Act or to accredited investors in transactions that are exempt from
the registration requirements of the Securities Act), and in connection with any subsequent sale by you of the Securities covered
hereby in reliance on Regulation S under the Securities Act during the period referred to above to any distributor, dealer
or person receiving a selling concession, fee or other remuneration, you must deliver a notice to substantially the foregoing effect.
Terms used above have the meanings assigned to them in Regulation S under the Securities Act.”

 

    	 	Annex I-1Exhibit
4.1

 

THE
SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION OR THE SECURITIES COMMISSION
OF ANY STATE IN RELIANCE UPON AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND, ACCORDINGLY, MAY
NOT BE OFFERED, SOLD, HEDGED, PLEDGED OR OTHERWISE TRANSFERRED UNLESS (I) SUCH SECURITIES HAVE BEEN REGISTERED FOR SALE PURSUANT
TO THE SECURITIES ACT OF 1933, AS AMENDED, (II) SUCH SECURITIES MAY BE SOLD PURSUANT TO RULE 144, OR (III) THE COMPANY HAS RECEIVED
AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO IT THAT SUCH TRANSFER MAY LAWFULLY BE MADE WITHOUT REGISTRATION UNDER THE SECURITIES
ACT OF 1933, AS AMENDED.

  

COMMON
STOCK PURCHASE WARRANT

 

NEONODE
INC.

 

	Warrant
    Shares: _______	Initial
    Exercise Date: August __, 2018
	 	 
	 	Issue
    Date: August __, 2017

 

THIS
COMMON STOCK PURCHASE WARRANT (the “Warrant”) certifies that, for value received, _____________ or its assigns
(the “Holder”) is entitled, upon the terms and subject to the limitations on exercise and the conditions hereinafter
set forth, at any time on or after the twelve month anniversary of the Issue Date (the “Initial Exercise Date”)
and on or prior to the close of business on the two year anniversary of the Initial Exercise Date (the “Termination Date”)
but not thereafter, to subscribe for and purchase from Neonode Inc., a Delaware corporation (the “Company”),
up to ______ shares (as subject to adjustment hereunder, the “Warrant Shares”) of Common Stock. The purchase
price of one share of Common Stock under this Warrant shall be equal to the Exercise Price, as defined in Section 2(b).

 

Section
1.Definitions. Capitalized terms used and not otherwise defined herein shall have the meanings set forth in that
certain Securities Purchase Agreement (the “Purchase Agreement”), dated August __, 2017, among the Company
and the purchasers signatory thereto.

 

Section
2.Exercise.

 

a) Exercise
of Warrant. Exercise of the purchase rights represented by this Warrant may be made, in whole or in part, at any time or times
on or after the Initial Exercise Date and on or before the Termination Date, subject to the limitations in Section 2(d), by delivery
to the Company (or such other office or agency of the Company as it may designate by notice in writing to the registered Holder
at the address of the Holder appearing on the books of the Company) of a duly executed facsimile copy (or e-mail attachment) of
the Notice of Exercise in the form annexed hereto. Within three (3) Trading Days following the date of exercise as aforesaid,
the Holder shall deliver the aggregate Exercise Price for the shares specified in the applicable Notice of Exercise by wire transfer
or cashier’s check. No ink-original Notice of Exercise shall be required, nor shall any medallion guarantee (or other type
of guarantee or notarization) of any Notice of Exercise form be required. Notwithstanding anything herein to the contrary, the
Holder shall not be required to physically surrender this Warrant to the Company until the Holder has purchased all of the Warrant
Shares available hereunder and the Warrant has been exercised in full, in which case, the Holder shall surrender this Warrant
to the Company for cancellation within three (3) Trading Days of the date the final Notice of Exercise is delivered to the Company.
Partial exercises of this Warrant resulting in purchases of a portion of the total number of Warrant Shares available hereunder
shall have the effect of lowering the outstanding number of Warrant Shares purchasable hereunder in an amount equal to the applicable
number of Warrant Shares purchased. The Holder and the Company shall maintain records showing the number of Warrant Shares purchased
and the date of such purchases. The Company shall deliver any objection to any Notice of Exercise within one (1) Business Day
of receipt of such notice. The Holder and any assignee, by acceptance of this Warrant, acknowledge and agree that, by reason
of the provisions of this paragraph, following the purchase of a portion of the Warrant Shares hereunder, the number of Warrant
Shares available for purchase hereunder at any given time may be less than the amount stated on the face hereof.

 

    1

    

    

 

b) Exercise
Price. The exercise price per share of the Common Stock under this Warrant shall be $2.00, subject to adjustment hereunder
(the “Exercise Price”).

 

c) Mechanics of Exercise.

 

i. Delivery
of Warrant Shares Upon Exercise. Warrant Shares purchased hereunder shall be transmitted to the Holder by crediting the account
of the Holder or its designee at the Transfer Agent by the date that is three (3) Trading Days after the delivery to the Company
of the Notice of Exercise (such date, the “Warrant Share Delivery Date”). Upon delivery of the Notice of Exercise
the Holder shall be deemed for all corporate purposes to have become the holder of record of the Warrant Shares with respect to
which this Warrant has been exercised, irrespective of the date of delivery of the Warrant Shares; provided payment of the aggregate
Exercise Price is received within three (3) Trading Days of delivery of the Notice of Exercise. The Company agrees to maintain
a transfer agent so long as this Warrant remains outstanding and exercisable.

 

ii. Delivery
of New Warrants Upon Exercise. If this Warrant shall have been exercised in part, the Company shall, at the request of a Holder
and upon surrender of this Warrant certificate, at the time of delivery of the Warrant Shares, deliver to the Holder a new Warrant
evidencing the rights of the Holder to purchase the unpurchased Warrant Shares called for by this Warrant, which new Warrant shall
in all other respects be identical with this Warrant.

 

    2

    

    

 

iii. Rescission
Rights. If the Company fails to cause the Transfer Agent to transmit to the Holder the Warrant Shares pursuant to Section
2(c)(i) by the Warrant Share Delivery Date, then the Holder will have the right to rescind such exercise.

 

iv. No
Fractional Shares or Scrip. No fractional shares or scrip representing fractional shares shall be issued upon the exercise
of this Warrant. As to any fraction of a share which the Holder would otherwise be entitled to purchase upon such exercise, the
Company shall, at its election, either pay a cash adjustment in respect of such final fraction in an amount equal to such fraction
multiplied by the Exercise Price or round up to the next whole share.

 

v. Charges,
Taxes and Expenses. Issuance of Warrant Shares shall be made without charge to the Holder for any issue or transfer tax or
other incidental expense in respect of the issuance of such Warrant Shares, all of which taxes and expenses shall be paid by the
Company, and such Warrant Shares shall be issued in the name of the Holder or in such name or names as may be directed by the
Holder; provided, however, that in the event that Warrant Shares are to be issued in a name other than the name
of the Holder, this Warrant when surrendered for exercise shall be accompanied by the Assignment Form attached hereto duly executed
by the Holder and the Company may require, as a condition thereto, the payment of a sum sufficient to reimburse it for any transfer
tax incidental thereto.

 

vi. Closing
of Books. The Company will not close its stockholder books or records in any manner which prevents the timely exercise of
this Warrant, pursuant to the terms hereof.

 

d) Holder’s
Exercise Limitations.

 

i. The
Company shall not effect any exercise of this Warrant, and a Holder shall not have the right to exercise any portion of this Warrant,
pursuant to Section 2 or otherwise, unless and until the Company has a sufficient number of authorized, unissued, and unreserved
shares of Common Stock to provide for the issuance of all Warrant Shares issuable upon the exercise of all Warrants issued pursuant
to the Purchase Agreement.

 

    3

    

    

 

ii. The
Company shall not effect any exercise of this Warrant, and a Holder shall not have the right to exercise any portion of this Warrant,
pursuant to Section 2 or otherwise, to the extent that after giving effect to such issuance after exercise as set forth on the
applicable Notice of Exercise, the Holder (together with the Holder’s Affiliates, and any other Persons acting as a group
together with the Holder or any of the Holder’s Affiliates (such Persons, “Attribution Parties”)), would
beneficially own in excess of the Beneficial Ownership Limitation (as defined below).  For purposes of the foregoing sentence,
the number of shares of Common Stock beneficially owned by the Holder and its Affiliates and Attribution Parties shall include
the number of shares of Common Stock issuable upon exercise of this Warrant with respect to which such determination is being
made, but shall exclude the number of shares of Common Stock which would be issuable upon (i) exercise of the remaining, nonexercised
portion of this Warrant beneficially owned by the Holder or any of its Affiliates or Attribution Parties and (ii) exercise or
conversion of the unexercised or nonconverted portion of any other securities of the Company (including, without limitation, any
other Common Stock Equivalents) subject to a limitation on conversion or exercise analogous to the limitation contained herein
beneficially owned by the Holder or any of its Affiliates or Attribution Parties.  Except as set forth in the preceding sentence,
for purposes of this Section 2(d), beneficial ownership shall be calculated in accordance with Section 13(d) of the Exchange Act
and the rules and regulations promulgated thereunder, it being acknowledged by the Holder that the Company is not representing
to the Holder that such calculation is in compliance with Section 13(d) of the Exchange Act and the Holder is solely responsible
for any schedules required to be filed in accordance therewith. To the extent that the limitation contained in this Section 2(d)
applies, the determination of whether this Warrant is exercisable (in relation to other securities owned by the Holder together
with any Affiliates and Attribution Parties) and of which portion of this Warrant is exercisable shall be in the sole discretion
of the Holder, and the submission of a Notice of Exercise shall be deemed to be the Holder’s determination of whether this
Warrant is exercisable (in relation to other securities owned by the Holder together with any Affiliates and Attribution Parties)
and of which portion of this Warrant is exercisable, in each case subject to the Beneficial Ownership Limitation, and the Company
shall have no obligation to verify or confirm the accuracy of such determination. In addition, a determination as to any group
status as contemplated above shall be determined in accordance with Section 13(d) of the Exchange Act and the rules and regulations
promulgated thereunder. For purposes of this Section 2(d), in determining the number of outstanding shares of Common Stock, a
Holder may rely on the number of outstanding shares of Common Stock as reflected in (A) the Company’s most recent periodic
or annual report filed with the Commission, as the case may be, (B) a more recent public announcement by the Company or (C) a
more recent written notice by the Company or the Transfer Agent setting forth the number of shares of Common Stock outstanding. 
Upon the written or oral request of a Holder, the Company shall within three Trading Days confirm orally and in writing to the
Holder the number of shares of Common Stock then outstanding.  In any case, the number of outstanding shares of Common Stock
shall be determined after giving effect to the conversion or exercise of securities of the Company, including this Warrant, by
the Holder or its Affiliates or Attribution Parties since the date as of which such number of outstanding shares of Common Stock
was reported. The “Beneficial Ownership Limitation” shall be 9.99% of the number of shares of the Common Stock
outstanding immediately after giving effect to the issuance of shares of Common Stock issuable upon exercise of this Warrant.
The provisions of this paragraph shall be construed and implemented in a manner otherwise than in strict conformity with the terms
of this Section 2(d) to correct this paragraph (or any portion hereof) which may be defective or inconsistent with the intended
Beneficial Ownership Limitation herein contained or to make changes or supplements necessary or desirable to properly give effect
to such limitation. The limitations contained in this paragraph shall apply to a successor holder of this Warrant.

 

    4

    

    

 

Section
3.Certain Adjustments.

 

a) Stock
Dividends, Splits and Reclassifications. If the Company, at any time while this Warrant is outstanding: (i) pays a stock dividend
or otherwise makes a distribution or distributions on shares of its Common Stock or any other equity or equity equivalent securities
payable in shares of Common Stock (which, for avoidance of doubt, shall not include any shares of Common Stock issued by the Company
upon exercise of this Warrant), (ii) subdivides outstanding shares of Common Stock into a larger number of shares, (iii) combines
(including by way of reverse stock split) outstanding shares of Common Stock into a smaller number of shares or (iv) issues by
reclassification of shares of the Common Stock any shares of capital stock of the Company, then in each case the Exercise Price
shall be multiplied by a fraction of which the numerator shall be the number of shares of Common Stock (excluding treasury shares,
if any) outstanding immediately before such event and of which the denominator shall be the number of shares of Common Stock outstanding
immediately after such event, and the number of shares issuable upon exercise of this Warrant shall be proportionately adjusted
such that the aggregate Exercise Price of this Warrant shall remain unchanged. Any adjustment made pursuant to this Section 3(a)
shall become effective immediately after the record date for the determination of stockholders entitled to receive such dividend
or distribution and shall become effective immediately after the effective date in the case of a subdivision, combination or re-classification.

 

b) Subsequent
Rights Offerings. In addition to any adjustments pursuant to Section 3(a) above, if at any time the Company grants, issues
or sells any Common Stock Equivalents or rights to purchase stock, warrants, securities or other property pro rata to all record
holders of any class of shares of Common Stock (the “Purchase Rights”), then the Holder will be entitled to
acquire, upon the terms applicable to such Purchase Rights, the aggregate Purchase Rights which the Holder could have acquired
if the Holder had held the number of shares of Common Stock acquirable upon complete exercise of this Warrant (without regard
to any limitations on exercise hereof, including without limitation, the Beneficial Ownership Limitation) immediately before the
date on which a record is taken for the grant, issuance or sale of such Purchase Rights, or, if no such record is taken, the date
as of which the record holders of shares of Common Stock are to be determined for the grant, issue or sale of such Purchase Rights
(provided, however, to the extent that the Holder’s right to participate in any such Purchase Right would result in the
Holder exceeding the Beneficial Ownership Limitation, then the Holder shall not be entitled to participate in such Purchase Right
to such extent (or beneficial ownership of such shares of Common Stock as a result of such Purchase Right to such extent) and
such Purchase Right to such extent shall be held in abeyance for the Holder until such time, if ever, as its right thereto would
not result in the Holder exceeding the Beneficial Ownership Limitation).

 

    5

    

    

 

c) Pro
Rata Distributions. During such time as this Warrant is outstanding, if the Company shall declare or make any dividend or
other distribution of its assets (or rights to acquire its assets) to holders of shares of Common Stock, by way of return of capital
or otherwise (including, without limitation, any distribution of cash, stock or other securities, property or options by way of
a dividend, spin off, reclassification, corporate rearrangement, scheme of arrangement or other similar transaction) (a "Distribution"),
at any time after the issuance of this Warrant, then, in each such case, the Holder shall be entitled to participate in such Distribution
to the same extent that the Holder would have participated therein if the Holder had held the number of shares of Common Stock
acquirable upon complete exercise of this Warrant (without regard to any limitations on exercise hereof, including without limitation,
the Beneficial Ownership Limitation) immediately before the date of which a record is taken for such Distribution, or, if no such
record is taken, the date as of which the record holders of shares of Common Stock are to be determined for the participation
in such Distribution (provided, however, to the extent that the Holder's right to participate in any such Distribution
would result in the Holder exceeding the Beneficial Ownership Limitation, then the Holder shall not be entitled to participate
in such Distribution to such extent (or in the beneficial ownership of any shares of Common Stock as a result of such Distribution
to such extent) and the portion of such Distribution shall be held in abeyance for the benefit of the Holder until such time,
if ever, as its right thereto would not result in the Holder exceeding the Beneficial Ownership Limitation).

 

d) Fundamental
Transaction.

 

If,
at any time while this Warrant is outstanding, (i) the Company, directly or indirectly, in one or more related transactions effects
any merger or consolidation of the Company with or into another Person, (ii) the Company, directly or indirectly, effects any
sale, lease, license, assignment, transfer, conveyance or other disposition of all or substantially all of its assets in one or
a series of related transactions, (iii) any, direct or indirect, purchase offer, tender offer or exchange offer (whether by the
Company or another Person) is completed pursuant to which holders of Common Stock are permitted to sell, tender or exchange their
shares for other securities, cash or property and has been accepted by the holders of 50% or more of the outstanding Common Stock,
(iv) the Company, directly or indirectly, in one or more related transactions effects any reclassification, reorganization or
recapitalization of the Common Stock or any compulsory share exchange pursuant to which the Common Stock is effectively converted
into or exchanged for other securities, cash or property (other than as a result of a stock split, combination or reclassification
of shares of Common Stock covered by Section 3(a) above), or (v) the Company, directly or indirectly, in one or more related transactions
consummates a stock or share purchase agreement or other business combination (including, without limitation, a reorganization,
recapitalization, spin-off or scheme of arrangement) with another Person or group of Persons whereby such other Person or group
acquires more than 50% of the outstanding shares of Common Stock (not including any shares of Common Stock held by the other Person
or other Persons making or party to, or associated or affiliated with the other Persons making or party to, such stock or share
purchase agreement or other business combination) (each a “Fundamental Transaction”), then, upon any subsequent
exercise of this Warrant, the Holder shall have the right to receive, for each Warrant Share that would have been issuable upon
such exercise immediately prior to the occurrence of such Fundamental Transaction, at the option of the Holder (without regard
to any limitation in Section 2(d) on the exercise of this Warrant), the number of shares of Common Stock of the successor or acquiring
corporation or of the Company, if it is the surviving corporation, and any additional consideration (the “Alternate Consideration”)
receivable as a result of such Fundamental Transaction by a holder of the number of shares of Common Stock for which this Warrant
is exercisable immediately prior to such Fundamental Transaction (without regard to any limitation in Section 2(d) on the exercise
of this Warrant). For purposes of any such exercise, the determination of the Exercise Price shall be appropriately adjusted to
apply to such Alternate Consideration based on the amount of Alternate Consideration issuable in respect of one share of Common
Stock in such Fundamental Transaction, and the Company shall apportion the Exercise Price among the Alternate Consideration in
a reasonable manner reflecting the relative value of any different components of the Alternate Consideration. If holders of Common
Stock are given any choice as to the securities, cash or property to be received in a Fundamental Transaction, then the Holder
shall be given the same choice as to the Alternate Consideration it receives upon any exercise of this Warrant following such
Fundamental Transaction.

 

    6

    

    

 

Notwithstanding
anything to the contrary, in the event of a Fundamental Transaction, the Company or any Successor Entity (as defined below) shall,
at the Holder’s option, exercisable at any time concurrently with, or within 30 days after, the consummation of the Fundamental
Transaction, purchase this Warrant from the Holder by paying to the Holder an amount of cash equal to the Black Scholes Value
of the remaining unexercised portion of this Warrant on the date of the consummation of such Fundamental Transaction. “Black
Scholes Value” means the value of this Warrant based on the Black and Scholes Option Pricing Model obtained from the
“OV” function on Bloomberg, L.P. (“Bloomberg”) determined as of the day of consummation of the
applicable Fundamental Transaction for pricing purposes and reflecting (A) a risk-free interest rate corresponding to the U.S.
Treasury rate for a period equal to the time between the date of the public announcement of the applicable Fundamental Transaction
and the Termination Date, (B) an expected volatility equal to the greater of 100% and the 100 day volatility obtained from the
HVT function on Bloomberg as of the Trading Day immediately following the public announcement of the applicable Fundamental Transaction,
(C) the underlying price per share used in such calculation shall be the sum of the price per share being offered in cash, if
any, plus the value of any non-cash consideration, if any, being offered in such Fundamental Transaction and (D) a remaining option
time equal to the time between the date of the public announcement of the applicable Fundamental Transaction and the Termination
Date. The payment of the Black Scholes Value will be made by wire transfer of immediately available funds within five Business
Days of the Holder’s election (or, if later, on the effective date of the Fundamental Transaction).

 

The
Company shall cause any successor entity in a Fundamental Transaction in which the Company is not the survivor (the “Successor
Entity”) to assume in writing all of the obligations of the Company under this Warrant and the other Transaction Documents
in accordance with the provisions of this Section 3(d) pursuant to written agreements in form and substance reasonably satisfactory
to the Holder and approved by the Holder (without unreasonable delay) prior to such Fundamental Transaction and shall, at the
option of the Holder, deliver to the Holder in exchange for this Warrant a security of the Successor Entity evidenced by a written
instrument substantially similar in form and substance to this Warrant which is exercisable for a corresponding number of shares
of capital stock of such Successor Entity (or its parent entity) equivalent to the shares of Common Stock acquirable and receivable
upon exercise of this Warrant (without regard to any limitations on the exercise of this Warrant) prior to such Fundamental Transaction,
and with an exercise price which applies the exercise price hereunder to such shares of capital stock (but taking into account
the relative value of the shares of Common Stock pursuant to such Fundamental Transaction and the value of such shares of capital
stock, such number of shares of capital stock and such exercise price being for the purpose of protecting the economic value of
this Warrant immediately prior to the consummation of such Fundamental Transaction), and which is reasonably satisfactory in form
and substance to the Holder. Upon the occurrence of any such Fundamental Transaction, the Successor Entity shall succeed to, and
be substituted for (so that from and after the date of such Fundamental Transaction, the provisions of this Warrant and the other
Transaction Documents referring to the “Company” shall refer instead to the Successor Entity), and may exercise every
right and power of, the Company and shall assume all of the obligations of the Company under this Warrant and the other Transaction
Documents with the same effect as if such Successor Entity had been named as the Company herein.

 

e) Calculations.
All calculations under this Section 3 shall be made to the nearest cent or the nearest 1/100th of a share, as the case may be.
For purposes of this Section 3, the number of shares of Common Stock deemed to be issued and outstanding as of a given date shall
be the sum of the number of shares of Common Stock (excluding treasury shares, if any) issued and outstanding.

 

f) Notice
to Holder.

 

i. Adjustment
to Exercise Price. Whenever the Exercise Price is adjusted pursuant to any provision of this Section 3, the Company shall
promptly deliver to the Holder by facsimile or email a notice setting forth the Exercise Price after such adjustment and any resulting
adjustment to the number of Warrant Shares and setting forth a brief statement of the facts requiring such adjustment.

 

    7

    

    

 

ii. Notice
to Allow Exercise by Holder. If (A) the Company shall declare a dividend (or any other distribution in whatever form) on the
Common Stock, (B) the Company shall declare a special nonrecurring cash dividend on or a redemption of the Common Stock, (C) the
Company shall authorize the granting to all holders of the Common Stock rights or warrants to subscribe for or purchase any shares
of capital stock of any class or of any rights, (D) the approval of any stockholders of the Company shall be required in connection
with any reclassification of the Common Stock, any consolidation or merger to which the Company is a party, any sale or transfer
of all or substantially all of the assets of the Company, or any compulsory share exchange whereby the Common Stock is converted
into other securities, cash or property, or (E) the Company shall authorize the voluntary or involuntary dissolution, liquidation
or winding up of the affairs of the Company, then, in each case, the Company shall cause to be delivered by facsimile or email
to the Holder at its last facsimile number or email address as it shall appear upon the Warrant Register of the Company, at least
ten (10) calendar days prior to the applicable record or effective date hereinafter specified, a notice stating (x) the date on
which a record is to be taken for the purpose of such dividend, distribution, redemption, rights or warrants, or if a record is
not to be taken, the date as of which the holders of the Common Stock of record to be entitled to such dividend, distributions,
redemption, rights or warrants are to be determined or (y) the date on which such reclassification, consolidation, merger, sale,
transfer or share exchange is expected to become effective or close, and the date as of which it is expected that holders of the
Common Stock of record shall be entitled to exchange their shares of the Common Stock for securities, cash or other property deliverable
upon such reclassification, consolidation, merger, sale, transfer or share exchange; provided that the failure to deliver such
notice or any defect therein or in the delivery thereof shall not affect the validity of the corporate action required to be specified
in such notice. To the extent that any notice provided in this Warrant constitutes, or contains, material, non-public information
regarding the Company or any of the Subsidiaries, the Company shall simultaneously file such notice with the Commission pursuant
to a Current Report on Form 8-K. The Holder shall remain entitled to exercise this Warrant during the period commencing on the
date of such notice to the effective date of the event triggering such notice except as may otherwise be expressly set forth herein.

 

Section
4.Transfer of Warrant.

 

a) Transferability.
Subject to compliance with any applicable securities laws and the conditions set forth in Section 4(d) hereof and to the provisions
of Section 4.1 of the Purchase Agreement, this Warrant and all rights hereunder are transferable, in whole or in part, upon surrender
of this Warrant at the principal office of the Company or its designated agent, together with a written assignment of this Warrant
substantially in the form attached hereto duly executed by the Holder or its agent or attorney and funds sufficient to pay any
transfer taxes payable upon the making of such transfer. Upon such surrender and, if required, such payment, the Company shall
execute and deliver a new Warrant or Warrants in the name of the assignee or assignees, as applicable, and in the denomination
or denominations specified in such instrument of assignment, and shall issue to the assignor a new Warrant evidencing the portion
of this Warrant not so assigned, and this Warrant shall promptly be cancelled. The Holder shall be required to physically surrender
this Warrant to the Company within three (3) Trading Days of the date the Holder delivers an assignment form to the Company assigning
this Warrant full. The Warrant, if properly assigned in accordance herewith, may be exercised by a new holder for the purchase
of Warrant Shares without having a new Warrant issued.

 

    8

    

    

 

b) New
Warrants. This Warrant may be divided or combined with other Warrants upon presentation hereof at the aforesaid office of
the Company, together with a written notice specifying the names and denominations in which new Warrants are to be issued, signed
by the Holder or its agent or attorney. Subject to compliance with Section 4(a), as to any transfer which may be involved in such
division or combination, the Company shall execute and deliver a new Warrant or Warrants in exchange for the Warrant or Warrants
to be divided or combined in accordance with such notice. All Warrants issued on transfers or exchanges shall be dated the original
Issue Date and shall be identical with this Warrant except as to the number of Warrant Shares issuable pursuant thereto.

 

c) Warrant
Register. The Company shall register this Warrant, upon records to be maintained by the Company for that purpose (the “Warrant
Register”), in the name of the record Holder hereof from time to time. The Company may deem and treat the registered
Holder of this Warrant as the absolute owner hereof for the purpose of any exercise hereof or any distribution to the Holder,
and for all other purposes, absent actual notice to the contrary.

 

d) Transfer
Restrictions. The Company may require, as a condition of allowing any transfer of this Warrant, that the Holder or transferee
of this Warrant, as the case may be, comply with the provisions of Section 5.7 of the Purchase Agreement.

 

e) Representation
by the Holder. The Holder, by the acceptance hereof, represents and warrants that it is acquiring this Warrant and, upon any
exercise hereof, will acquire the Warrant Shares issuable upon such exercise, for its own account and not with a view to or for
distributing or reselling such Warrant Shares or any part thereof in violation of the Securities Act or any applicable state securities
law, except pursuant to sales registered or exempted under the Securities Act.

 

Section
5.Miscellaneous.

 

a) No
Rights as Stockholder Until Exercise. This Warrant does not entitle the Holder to any voting rights, dividends or other rights
as a stockholder of the Company prior to the exercise hereof as set forth in Section 2(d)(i), except as expressly set forth in
Section 3.

 

    9

    

    

 

b) Loss,
Theft, Destruction or Mutilation of Warrant. The Company covenants that upon receipt by the Company of evidence reasonably
satisfactory to it of the loss, theft, destruction or mutilation of this Warrant or any stock certificate relating to the Warrant
Shares, and in case of loss, theft or destruction, of indemnity or security reasonably satisfactory to it (which, in the case
of the Warrant, shall not include the posting of any bond), and upon surrender and cancellation of such Warrant or stock certificate,
if mutilated, the Company will make and deliver a new Warrant or stock certificate of like tenor and dated as of such cancellation,
in lieu of such Warrant or stock certificate.

 

c) 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.

 

d) Authorized
Shares. The Company covenants that, subject to stockholder approval of the Charter Amendment, during the period the Warrant
is outstanding, the Company will reserve from its authorized and unissued Common Stock a sufficient number of shares to provide
for the issuance of the Warrant Shares upon the exercise of any purchase rights under this Warrant. The Company further covenants
that its issuance of this Warrant shall constitute full authority, subject to stockholder approval of the Charter Amendment, to
its officers who are charged with the duty of issuing the necessary Warrant Shares upon the exercise of the purchase rights under
this Warrant. Subject to stockholder approval of the Charter Amendment, the Company will take all such reasonable action as may
be necessary to assure that such Warrant Shares may be issued as provided herein without violation of any applicable law or regulation,
or of any requirements of the Trading Market upon which the Common Stock may be listed. The Company covenants that, subject to
stockholder approval of the Charter Amendment, all Warrant Shares which may be issued upon the exercise of the purchase rights
represented by this Warrant will, upon exercise of the purchase rights represented by this Warrant and payment for such Warrant
Shares in accordance herewith, be duly authorized, validly issued, fully paid and nonassessable and free from all taxes, liens
and charges created by the Company in respect of the issue thereof (other than taxes in respect of any transfer occurring contemporaneously
with such issue).

 

Except
and to the extent as waived or consented to by the Holder, the Company shall not by any action, including, without limitation,
amending the Certificate of Incorporation or through any reorganization, transfer of assets, consolidation, merger, dissolution,
issue or sale of securities or any other voluntary action, avoid or seek to avoid the observance or performance of any of the
terms of this Warrant, but will at all times in good faith assist in the carrying out of all such terms and in the taking of all
such actions as may be necessary or appropriate to protect the rights of Holder as set forth in this Warrant against impairment.
Without limiting the generality of the foregoing, from and after the date the Charter Amendment is effected pursuant to Section
3.1(h) of the Purchase Agreement, the Company will (i) not increase the par value of any Warrant Shares above the amount payable
therefor upon such exercise immediately prior to such increase in par value, (ii) take all such action as may be necessary or
appropriate in order that the Company may validly and legally issue fully paid and nonassessable Warrant Shares upon the exercise
of this Warrant and (iii) use commercially reasonable efforts to obtain all such authorizations, exemptions or consents from any
public regulatory body having jurisdiction thereof, as may be, necessary to enable the Company to perform its obligations under
this Warrant.

 

    10

    

    

 

Before
taking any action which would result in an adjustment in the number of Warrant Shares for which this Warrant is exercisable or
in the Exercise Price, the Company shall obtain all such authorizations or exemptions thereof, or consents thereto, as may be
necessary from any public regulatory body or bodies having jurisdiction thereof.

 

e) Jurisdiction.
All questions concerning the construction, validity, enforcement and interpretation of this Warrant shall be determined in accordance
with the provisions of the Purchase Agreement.

 

f) Restrictions.
The Holder acknowledges that the Warrant Shares acquired upon the exercise of this Warrant will have restrictions upon resale
imposed by state and federal securities laws.

 

g) Nonwaiver
and Expenses. No course of dealing or any delay or failure to exercise any right hereunder on the part of Holder shall operate
as a waiver of such right or otherwise prejudice the Holder’s rights, powers or remedies, notwithstanding the fact that
all rights hereunder terminate on the Termination Date. If the Company willfully and knowingly fails to comply with any provision
of this Warrant, which results in any material damages to the Holder, the Company shall pay to the Holder such amounts as shall
be sufficient to cover any costs and expenses including, but not limited to, reasonable attorneys’ fees, including those
of appellate proceedings, incurred by the Holder in collecting any amounts due pursuant hereto or in otherwise enforcing any of
its rights, powers or remedies hereunder.

 

h) Notices.
Any notice, request or other document required or permitted to be given or delivered to the Holder by the Company shall be delivered
in accordance with the notice provisions of the Purchase Agreement.

 

i) Limitation
of Liability. No provision hereof, in the absence of any affirmative action by the Holder to exercise this Warrant to purchase
Warrant Shares, and no enumeration herein of the rights or privileges of the Holder, shall give rise to any liability of the Holder
for the purchase price of any Common Stock or as a stockholder of the Company, whether such liability is asserted by the Company
or by creditors of the Company.

 

j) Remedies.
The Holder, in addition to being entitled to exercise all rights granted by law, including recovery of damages, will be entitled
to specific performance of its rights under this Warrant. The Company agrees that monetary damages would not be adequate compensation
for any loss incurred by reason of a breach by it of the provisions of this Warrant and hereby agrees to waive and not to assert
the defense in any action for specific performance that a remedy at law would be adequate.

 

    11

    

    

 

k) Successors
and Assigns. Subject to applicable securities laws, this Warrant and the rights and obligations evidenced hereby shall inure
to the benefit of and be binding upon the successors and permitted assigns of the Company and the successors and permitted assigns
of Holder. The provisions of this Warrant are intended to be for the benefit of any Holder from time to time of this Warrant and
shall be enforceable by the Holder or holder of Warrant Shares.

 

l) Amendment.
This Warrant may be modified or amended or the provisions hereof waived with the written consent of the Company and the Holder.

 

m) Severability.
Wherever possible, each provision of this Warrant shall be interpreted in such manner as to be effective and valid under applicable
law, but if any provision of this Warrant shall be prohibited by or invalid under applicable law, such provision shall be ineffective
to the extent of such prohibition or invalidity, without invalidating the remainder of such provisions or the remaining provisions
of this Warrant.

 

n) Headings.
The headings used in this Warrant are for the convenience of reference only and shall not, for any purpose, be deemed a part of
this Warrant.

 

 

 

********************

 

  

(Signature
Page Follows)

 

    12

    

    

 

IN
WITNESS WHEREOF, the Company has caused this Warrant to be executed by its officer thereunto duly authorized as of the date first
above indicated.

 

	 	NEONODE INC.

	 	 
	 	By:	          
	 	 	
        Name:

        Title:

 

    13

    

    

 

APPENDIX
A

  

NOTICE
OF EXERCISE

 

 

To:Neonode
inc.

 

The
undersigned hereby elects to purchase ________ Warrant Shares of the Company pursuant to the terms of the attached Warrant (only
if exercised in full), and tenders herewith payment of the exercise price in full, together with all applicable transfer taxes,
if any.

 

The
undersigned is an “accredited investor” as defined in Regulation D promulgated under the Securities Act of 1933, as
amended.

 

Please
issue said Warrant Shares in the name of the undersigned or in such other name as is specified below:

 

________________________________________

  

 

[SIGNATURE
OF HOLDER]

 

Name
of Investor: ____________________________________________________________________

 

Signature
of Authorized Signatory of Investor: _____________________________________________

 

Name
of Authorized Signatory: _________________________________________________________

 

Title
of Authorized Signatory: __________________________________________________________

 

Date:
______________________________________________________________________________

 

    14

    

    

 

APPENDIX
B

 

ASSIGNMENT
FORM

 

(To
assign the foregoing Warrant, execute this form and supply required information. Do not use this form to purchase shares.)

  

FOR
VALUE RECEIVED, the foregoing Warrant and all rights evidenced thereby are hereby assigned to

 

	Name:	 	
	 	 	(Please
    Print)
	 	 	 
	Address:	 	
	
	 	(Please
Print)

	 	 	 
	Phone
Number:	 	 
	 	 	 
	 	 	 
	 	 	 
	Email
        Address:	 	 
	 	 	 
	Dated:
    _______________ __, ______	 	 
	Holder’s
    Signature:                                             	 	 
	Holder’s
    Address:                                             	 	 

 

 

15

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