Document:

Exhibit 10.16

 

 

 

  

 

PLACEMENT AGENT AGREEMENT

 

 

between
CARDAX

 PHARMA, INC. and

PORTFOLIO ADVISORS ALLIANCE,
INC.

 

 

January 3, 2014

 

 

 

 

    	 

    	 

    

 

	Section 1.	The Offering	1
	 	 	 
	Section 2.	Closing	3
	 	 	 
	Section 3.	Retention and Compensation of Placement Agent	4
	 	 	 
	Section 4.	Representations and Warranties of the Company	5
	 	 	 
	Section 5.	Representations and Warranties of the Placement Agent	11
	 	 	 
	Section 6.	Covenants of the Company	11
	 	 	 
	Section 7.	Expenses of Sale	13
	 	 	 
	Section 8.	Conditions to the Placement Agent’s Closing Obligations	13
	 	 	 
	Section 9.	Conditions to the Company’s Closing Obligations	14
	 	 	 
	Section 10.	Non-Solicitation and “Tail.”	14
	 	 	 
	Section 11.	Indemnification	15
	 	 	 
	Section 12.	Registration	16
	 	 	 
	Section 13.	Termination	17
	 	 	 
	Section 14.	Notices	18
	 	 	 
	Section 15.	Parties	19
	 	 	 
	Section 16.	Severability	19
	 	 	 
	Section 17.	Captions	19
	 	 	 
	Section 18.	Applicable Law	19
	 	 	 
	Section 19.	Prior Agreements	19
	 	 	 
	Section 20.	Limitations	20
	 	 	 
	Section 21.	Counterparts	20

 

	Schedule 1	Description of Merger Agreement Transactions
	Schedule 2	Outstanding Equity Securities of the Public Parent
	 	Immediately Following the Reverse Merger
	 	 
	Annex A	Indemnification Provisions
	 	 
	Exhibit A	Form of Amended Subscription Agreement
	Exhibit B	Form of Placement Agent Warrant

 

    	 

    	 

    

 

Defined Terms Cross Reference Table

 

	Accredited Investors	Section 1(a)
	Action	Annex A
	Agreement	Annex A
	Cash Fee	Section 3(b)(i)(A)
	Closing	Section 2
	Closing Date	Section 2
	Commission	Section 1(d)
	Companies	Section 4(d)
	Company	Annex A, Page 1
	Company Counsel	Section 8(a)(ii)
	Concurrent Offering	Section 1(e)
	Convertible Notes	Section 1(a)
	Covered Investors	Section 10(a)
	Damages	Annex A
	Escrow Account	Section 1(c)
	Escrow Agent	Section 1(c)
	Exchange Act	Section 4(a)
	Existing Secured Note Purchasers	Section 4(p)
	FINRA	Section 5(a)
	Holdings	Section 4(c)
	Indemnified Person	Annex A
	Indemnified Persons	Annex A
	Intellectual Property Rights	Section 4(e)
	Material Adverse Effect	Section 4(d)
	Merger Agreement	Section 4(c)
	Money Laundering Laws	Section 4(v)
	Non-Accountable Expense Allowance	Section 3(b)(i)(B)
	Non-Solicitation and ‘Tail’	Section 3(e)
	Non-Solicitation Period	Section 10(a)
	Note Shares	Section 1(a)
	OFAC	Section 4(u)
	Offering	Section 1(a)
	Offering Shares	Section 1(a)
	Officers Certificate	Section 8(a)(iii)
	Permit	Section 4(f)
	Placement Agent	Annex A, Page 1
	Placement Agent Fee	Section 3(b)(i)(B)
	Placement Agent Warrants	Section 3(b)(ii)
	Pubco Sub	Section 4(c)
	Public Filings	Section 4(b)
	Public Parent	Section 1(a)

 

    	ii

    	 

    

 

	Public Parent Common Stock	Section 1(a)
	Purchasers	Section 1(b)
	Registration Limitation	Section 12(a)
	Registration Statement	Section 12(a)
	Regulation D	Section 1(d)
	Regulation S	Section 1(d)
	Reverse Merger	Section 4(c)
	Securities	Annex A
	Securities Act	Section 1(a)
	Subscription Agreement	Section 1(b)
	Units	Section 1(e)
	Warrant	Section 1(a)
	Warrant Shares	Section 1(a)

 

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CARDAX PHARMA, INC.

2800 Woodlawn Drive, Suite
129

Honolulu, Hawaii 96822

  

$2,076,000 in Principal
Amount

of Convertible Unsecured
Promissory Notes

  

 

 

PLACEMENT
AGENT AGREEMENT

 

 

 

 January 3, 2014

Portfolio Advisors Alliance, Inc.

330 Madison Avenue, 6th Floor

New York, New York 10017

 

Ladies and Gentlemen:

 

Cardax Pharma, Inc.,
a Delaware corporation (the “Company”), hereby confirms its agreements with Portfolio Advisors Alliance, Inc.,
a California corporation (the “Placement Agent”), as follows:

 

Section 1.The Offering.

 

(a)The
Company proposes to issue and sell (the “Offering”) to selected accredited investors
(“Accredited Investors”), as that term is defined in Rule 501(a) of the Securities Act of 1933 (the
“Securities Act”), $2,076,000 in aggregate principal amount of convertible unsecured promissory notes of
the Company (the “Convertible Notes”), with each such Convertible Note in the form attached as
Exhibit II to the Subscription Agreement (as defined in Section 1(b) hereof). Upon consummation of the Reverse Merger
(as hereinafter defined), each Convertible Note and the interest accrued thereunder shall be converted automatically into (i)
shares of the common stock, par value $0.001 per share (the “Public Parent Common Stock”), of Koffee
Korner, Inc., a Delaware corporation (such entity, or, in lieu thereof, any other applicable public company (in the
Company’s reasonable discretion) with which the Company effects a reverse merger transaction similar in effect to the
“Merger” described elsewhere herein, the “Public Parent”) that will change its name to Cardax,
Inc. upon consummation of the Reverse Merger, at a conversion price of sixty-two and one-half cents ($0.625) for each share
of the Public Parent Common Stock; and (ii) a warrant (each, a “Warrant” and, collectively, the
“Warrants”), in the form attached as Exhibit I to the
Subscription Agreement, to purchase for five years a number of shares of Public Parent Common Stock determined by dividing
the initial principal amount of the applicable Convertible Note by $0.625. The shares of Public Parent Common Stock issuable
by the Public Parent upon conversion of the Convertible Notes offered and sold in the Offering are hereinafter referred to as
the “Note Shares”; the shares of Public Parent Common Stock underlying the Warrants that will be issued at
the time of the Reverse Merger upon conversion of the Convertible Notes are hereinafter
referred to as the “Warrant Shares”; and the Note Shares and the Warrant Shares are collectively
hereinafter referred to as the “Offering Shares.”

 

    	 

    	 

    

 

(b)The Company
shall enter into a subscription agreement in the form attached hereto as Exhibit A (the “Subscription
Agreement”) with respect to each sale of Convertible Notes in the Offering. Persons offering to subscribe for and
who thereafter purchase Convertible Notes are referred to herein as “Purchasers.” The Company reserves the
right to refuse to sell Convertible Notes to any person at any time prior to the Company’s written acceptance of the
applicable Subscription Agreement for such person. The Company’s acceptance of any subscription shall be irrevocable
unless the Placement Agent consents otherwise or any representation and warranty of the applicable Purchaser shall not be
true and correct. The Closing of the sale of the Convertible Notes in the Offering will take place in accordance with Section
3 hereof.

 

(c)Proceeds
received from prospective Purchasers for the purchase of Convertible Notes initially will be deposited in an escrow account (“Escrow
Account”) with Signature Bank, as escrow agent (the “Escrow Agent”), pursuant to that certain escrow
deposit agreement dated as of November 18, 2013 and amended as of January 2, 2014 between the Company, the Placement Agent and
the Escrow Agent, and will be released only pursuant to the terms of Section 2 hereof.

 

(d)Neither
the offer for sale nor the sale of the Convertible Notes has been or will be registered with the United States Securities
and Exchange Commission (the “Commission”). The Company and the Placement Agent shall each conduct all of
their activities with respect to the Offering in a manner that will ensure that the Convertible Notes will be offered for
sale, and sold in reliance upon, the exemptions from the registration requirements of Section 5 of the Securities Act
provided by the provisions of Regulation D promulgated thereunder (“Regulation D”), or if permitted by the
Company Regulation S promulgated under the Securities Act (“Regulation S”), and the Company will file all
appropriate notices of the Offering with the Commission on Form D with respect to the Offering. In addition, the Company
shall obtain all “Blue Sky” and state securities registrations, qualifications, approvals or exemptions therefrom
and take all necessary action and file all necessary forms and documents in order to qualify or register all or a portion of
the Convertible Notes for offer or sale in such states as the Placement Agent shall reasonably request or effect the
exemption therefrom; provided, however, that in no event shall the Company be obligated to qualify to do
business in any jurisdiction where it is not now so qualified or to take any action which would subject it to service of
process in suits, other than those arising out of the offering or sale of the Convertible Notes. If permitted by the Company,
the offering of the Convertible Notes may be made in reliance upon the exemption from the registration requirements of
Section 5 of the Securities Act provided by the provisions of Regulation S, in which case, the Purchaser will be required to
agree to certain restrictions with respect to the sale of any Note Shares or Warrant Shares in the United States.

 

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(e)The Placement
Agent acknowledges that the Company is currently conducting a concurrent offering (the “Concurrent
Offering”) of units (“Units”) of shares of Public Parent Common Stock and warrants to be issued
by the Public Parent. In the Concurrent Offering, the Units will be offered and sold for the same offering price as the
conversion price of the Notes being offered and sold in the Offering described in this Agreement (i.e., $0.625 per share),
and the warrants to be issued by the Public Parent in the Concurrent Offering will be exercisable at the same exercise price
per share as the exercise price of the Warrants to be issued upon conversion of the Convertible Notes being offered and sold
in the Offering described in this Agreement (i.e., $0.625 per share) and have other similar terms and conditions as the
Warrants.

 

(f)The
Company and the Placement Agent agree that Agincourt Ltd., and its subagent Paulson Investment Company, Inc. will not receive
any compensation described in Section 3 hereof with respect to the sale of the Convertible Notes offered hereby except as specifically
contemplated in Section 3(b)(i)(C) hereof. Further, the Placement Agent agrees that it will not receive any compensation described
in Section 3 hereof with respect to the securities being offered and sold in the Concurrent Offering that were introduced to the
Company by any such Person. On or prior to the closing of the Concurrent Offering, Agincourt Ltd. shall confirm to the Placement
Agent that the investors in the Concurrent Offering were introduced to the Company by Agincourt Ltd.; provided, however,
that it is acknowledged and agreed by the Placement Agent that neither Holdings, the Company nor the Public Parent nor any of
their respective affiliates shall be responsible for any breach of the obligations of Agincourt, Ltd under this sentence and the
obligations under this sentence shall be the sole obligation of Agincourt Ltd.

 

Section 2.Closing.
At such time as the Company has accepted subscriptions from one or more Purchasers for such amount as the Company and the Placement
Agent shall agree will be the closing amount, the Company and the Placement Agent shall, subject to the satisfaction of the conditions
of closing required by Section 8(a) hereof, agree upon a date and time for a closing at which the Company shall issue and
sell to the Purchasers the Convertible Notes subscribed for in the applicable Subscription Agreements (the “Closing”).
The Closing is anticipated to occur on January 3, 2014, provided that such date may be extended by mutual agreement between the
Company and the Placement Agent. The date of the Closing is referred to in this Agreement as the “Closing Date.”

 

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Section 3.Retention and Compensation of Placement
Agent.

 

(a)The Company hereby
engages the Placement Agent as its agent to solicit subscriptions for the Convertible Notes to be sold in the Offering in accordance
with the terms of this Agreement, and the Placement Agent hereby accepts such engagement and agrees to use its reasonable best
efforts to solicit such subscriptions. The Placement Agent shall cause each of its prospective Purchasers to evidence its intent
to subscribe for Convertible Notes by the completion and execution of a Subscription Agreement and the related documents referred
to therein.

 

(b)At the Closing (or, in the case of the warrants
referred to in item (ii) below, upon the closing of the Reverse Merger), the Company will pay the following:

 

(i) A cash fee from the gross
purchase price of the Convertible Notes sold at the Closing to Purchasers introduced, identified, sourced or in any other way brought
to the attention of the Company by the Placement Agent, as follows:

 

(A) To the Placement Agent,
seven percent (7%) of such gross purchase price (the “Cash Fee”);

 

(B) To the Placement Agent,
a non-accountable expense allowance equal to three percent (3%) of such gross purchase price (the “Non-Accountable Expense
Allowance”) and collectively with the Cash Fee, the “Placement Agent Fee”), and

 

(C) To Agincourt Ltd. (a
registered broker-dealer with a prior placement agent relationship with the Company), in lieu of any other compensation to which
it may otherwise be entitled with respect to the Offering from the Company or the Public Parent under any separate agreement, a
manager’s fee of three percent (3%) of such gross purchase price; and

 

(ii) To the Placement Agent,
five-year warrants to acquire four hundred ninety-eight thousand, two hundred forty (498,240) shares of the Public Parent’s
common stock, which warrants will have an exercise price of $0.625 per share, will have a cashless exercise feature, and will provide
customary anti-dilution protection for structural changes in the issuer’s capitalization, such warrants to be in the form
attached hereto as Exhibit B (the “Placement Agent Warrants”).

 

(c)For the avoidance
of doubt, no compensation shall be payable to the Placement Agent under this Agreement with respect to any Units sold to current
investors in the Company or to the purchasers in the Concurrent Offering.

 

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(d)The wire transfer instructions for all cash
payments to the Placement Agent are as follows:

 

Account Name:

Bank:

Phone:

ABA Routing #:

Account #:

 

(e)The Placement Agent
shall also be entitled to compensation as contemplated in Section 10 hereof (“Non-Solicitation and ‘Tail’”),
if applicable.

 

(f)The Company shall
pay the Placement Agent’s reasonable costs and expenses in connection with the Offering, including, but not limited to, travel,
mail, overnight packages, copying, printing and legal fees. For this purpose, the fees and expenses of the Placement Agent’s
legal counsel, Troutman Sanders LLP, are estimated to be in the range of $60,000 to $75,000 (and shall not exceed such amount without
the Company’s prior written consent) in connection with the Offering; it is acknowledged that Pharma has previously paid
the amount of $20,000 of such fees and expenses.

 

Section
4. Representations and Warranties of the Company. The Company represents and warrants to the Placement Agent, for the benefit
of the Placement Agent and the Purchasers, as follows:

 

(a)The Public Parent is
registered as a reporting company under the Securities and Exchange Act of 1934 (the “Exchange Act”). The Public
Parent has taken no action intended to, or that would terminate, or would be likely to have the effect of terminating, the registration
under the Exchange Act, nor has the Public Parent received any notification that the Commission is contemplating terminating such
registration.

 

(b)The
documents filed by the Public Parent (the “Public Filings”) with the Commission since May 29, 2012, at
the time they were filed with the Commission, complied in all material respects with the requirements of the Securities Act,
the Exchange Act, and the rules and regulations promulgated thereunder, as applicable. The Public Filings do not include any
untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the
statements therein not misleading.

 

(c)As
promptly as practicable after the date hereof (assuming that the closing conditions of the Merger Agreement may be satisfied
and there would not be a breach or default by Public Parent under the Merger Agreement), the Company will cause a merger (the
“Reverse Merger”) to be consummated between Cardax Acquisition, Inc., a Delaware corporation and a
wholly-owned subsidiary of the Public Parent (“Pubco Sub”), and the Company, with the Company being the
surviving corporation of the Reverse Merger and becoming a wholly owned subsidiary of the Public Parent. The Reverse Merger
will be consummated pursuant to the Agreement and Plan of Merger dated as of November 27, 2013 (as such agreement may be
amended, the “Merger Agreement”), by and among the Company, Pubco Sub, Cardax Pharmaceuticals, Inc., a
Delaware corporation (“Holdings”), and Pharma. Pursuant to the Merger Agreement, the parties thereto will
give effect to the transactions described on Schedule 1 attached hereto.

 

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(d)Each of the Company and the Purblic Parent
(together, hereinafter, the “Companies”) is a corporation duly organized and validly existing under the laws
of the state of Delaware with full corporate power and authority to own, lease and operate its respective properties and to conduct
its respective business as presently conducted, and is duly registered and qualified to conduct its business and is in good standing
in each jurisdiction or place where the nature of its properties or the conduct of itsbusiness requires such registration or qualification,
except where the failure to so register or qualify would not reasonably be expected to have a Material Adverse Effect. For purposes
of this Agreement, a “Material Adverse Effect” shall mean a material adverse effect on the condition (financial
or other), business, properties, net worth or results of operations of the Company or the Public Parent.

 

(e)The Company owns or
possesses or has valid rights to use all patents, patent applications, trademarks, service marks, trade names, trademark registrations,
service mark registrations, copyrights, licenses, inventions, trade secrets and similar rights (“Intellectual Property
Rights”) necessary for the conduct of the business of the Company as currently carried on.

 

(f)The Company is engaged
in the development of certain carotenoid products, in particular a synthetic form of astaxanthin, directly and through agreement
with BASF, Aktiengesselschaft, a German chemical company. Each of the Companies (i) has all permits, licenses, franchises, approvals,
consents and authorizations of governmental or regulatory authorities or private persons or entities (hereinafter “permit”
or “permits”) as are necessary to own its properties and to conduct its business in the manner currently conducted,
except where the failure to have obtained any such permit has not and will not have a Material Adverse Effect, and (ii) has fulfilled
and performed all of its obligations with respect to each such permit in all material respects.

 

(g)The
Company has all requisite corporate power and authority to enter into this Agreement and to perform its obligations
hereunder, including without limitation the obligation to issue the Convertible Notes at the Closing hereunder. The execution
and delivery of this Agreement and the performance by the Company of its obligations hereunder have been duly and validly
authorized by all necessary action on the part of the Company, including its board of directors, and this Agreement has been
duly executed and delivered by the Company and constitutes the valid and legally binding agreement of the Company,
enforceable against the Company in accordance with its terms.

 

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(h)The execution
and delivery of the Merger Agreement and the performance by the Public Parent, PubCo Sub, the Company, Holdings and any other
party thereto of its respective obligations thereunder and the transactions contemplated thereby were duly and validly
authorized by all necessary action on the part of each such entity, its board of directors and its stockholders, as
applicable, and the Merger Agreement was duly executed and delivered by Public Parent, PubCo Sub, the Company, Holdings and
any other party thereto and constitutes the valid and legally binding agreement of each of such parties, enforceable against
such party in accordance with its terms.

 

(i)The
outstanding shares of Public Parent Common Stock, and all securities and other agreements or obligations of the Public
Parent that represent the right to acquire shares of Public Parent Common Stock, in each case to be outstanding on the
effective date of the Reverse Merger following (i) the consummation of the Reverse Merger, (ii) the conversion of the
Convertible Notes offered and sold hereby, (iii) the conversion of the convertible secured notes offered and sold by the
Company in a private placement transaction during 2013, (iv) the conversion of the convertible secured notes issued by the
Company to prior investors in Cardax Pharmaceuticals, Inc. during 2013, and (v) the issuance of any shares of Public Parent
Common Stock in the Concurrent Offering, are as set forth on Schedule 2 attached hereto (subject to the assumptions
set forth in such Schedule). All of such shares of Public Parent Common Stock to be issued as shown on Schedule 2,
will have been duly authorized and validly issued, and are fully paid and nonassessable. Except as described on Schedule
2, including without limitation the authorization of the Company to issue options and other awards under its Equity
Incentive Plan, the Public Parent will not have outstanding any shares of Public Parent Common Stock or preferred stock, or
any options to purchase, any warrants to subscribe for, or any other securities or obligations convertible into or
exchangeable for, or any contracts or commitments to issue or sell, or otherwise providing the right to acquire, any shares
of Public Parent Common Stock or preferred stock of the Public Parent or any rights of any kind that would allow the holder
thereof to acquire any such options, warrants, securities or obligations; provided, however, that the Placement
Agent acknowledges and agrees that the actual capitalization of Public Parent may be changed (but in any event not by an
amount that in the aggregate would change the fully diluted shares by more than 5% or such other amount as may be agreed to
by the Placement Agent) to reflect stock or warrants issued to other persons involved in the Reverse Merger or the
transactions related thereto or the number of shares that will be held by stockholders of Public Parent prior to the
closing of the Reverse Merger. The Placement Agent accepts the changes between Schedule 3.2(b) to the Subscription Agreement
and Schedule 2 of this Agreement for the purposes of Section 3.1(b) of the Subscription Agreement.

 

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(j)When issued
and sold in accordance with the terms hereof and the applicable Subscription Agreements, the Convertible Notes will be
validly authorized by all necessary action on the part of the Company, including its board of directors. Assuming that the
Reverse Merger is effected in accordance with the terms of the Merger Agreement, when issued upon conversion of the
Convertible Notes, the Note Shares, the Warrants issuable by the Public Parent upon such conversion and the Warrant Shares
issuable upon exercise of the Warrants will be duly and validly authorized by all necessary action on the part of the Public
Parent, including its board of directors. Assuming that the Reverse Merger is effected in accordance with the terms of the
Merger Agreement, when issued upon conversion of the Convertible Notes, the Note Shares will be duly authorized, validly
issued, fully paid and nonassessable shares of Public Parent Common Stock. Assuming that the Reverse Merger is effected in
accordance with the terms of the Merger Agreement, when issued upon exercise of the Warrants in accordance with their terms,
the Warrant Shares will be duly authorized, validly issued, fully paid and nonassessable shares of Public Parent Common
Stock.

 

(k)Immediately following
the Reverse Merger, except for the Company, the Public Parent will not have any subsidiaries or own a material interest in or control
directly or indirectly any other domestic of foreign corporation, limited liability company, limited partnership, general partnership,
joint venture, association, trust or other business organization, provided that on or promptly after the Closing, the Company,
distribute all of the shares of Koffee Korner’s Inc., a Texas corporation, to Nazneen D’Silva.

 

(l)
All offers and sales of the capital stock and debt or other securities of the Company and of the Public Parent prior to the
date hereof were made in compliance with the Securities Act and all other applicable state and federal laws and regulations,
or any actions under the Securities Act or any state or federal laws or regulations in respect of any such offers or sales
are barred by effective waivers or statutes of limitation.

 

(m)Assuming the compliance
by the Placement Agent with its obligations under Sections 5 and 7 of this Agreement, the sale of the Convertible
Notes in the Offering is exempt from the registration requirements of the Securities Act.

 

(n)There is no material
action, suit, inquiry or proceeding by or before any court or governmental or other regulatory or administrative agency or commission
pending or, to the knowledge of the Company, overtly threatened against or involving the Company or any of its property or assets,
nor, to the knowledge of the Company, is there any investigation by any governmental or other regulatory or administrative agency
or commission against the Company or any of its property or assets, nor is there any reasonable basis for any such action, suit,
inquiry, proceeding or investigation.

 

(o)Neither the
issuance and sale of the Convertible Notes, the execution or delivery of this Agreement nor the consummation by the Company
or the Public Parent of the transactions contemplated hereby (i) violates any agreement to which the Company or the Public
Parent is a party, or (ii) requires any consent, approval, authorization or other order of or registration or filing with,
any person or entity, including without limitation any court, regulatory body, administrative agency or other governmental
body, agency or official (except such as may be required for the compliance with the securities or “Blue Sky”
laws of various jurisdictions, all of which shall have been obtained or timely filed and obtained and except for filings with
respect to the Reverse Merger that will be made on the effective date of the Reverse Merger).

 

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(p)On the effective date
of the Reverse Merger, no person or entity, including without limitation any holder of any securities of the Public Parent or the
Company or any rights exercisable for or convertible or exchangeable into securities of the Public Parent or the Company or any
of their affiliates, has the right to require the Public Parent or the Company to register any such securities of the Public Parent
or the Company under the Securities Act or to include any such securities in a registration statement to be filed by the Public
Parent or the Company, except for shares of Public Parent Common Stock issued to the holders who purchased or otherwise acquired
senior secured convertible notes from the Company in a private placement in 2013 (the “Existing Secured Note Purchasers”)
and purchasers of Units in the Concurrent Offering or others who purchase Units and placement agents and others who receive securities
issued by the Public Parent in connection with the Reverse Merger or any issuance of securities by Pharma. Subject to the Registration
Limitation (as hereinafter defined in Section 12), the Company agrees to file a registration statement to include the Note
Shares and the Warrant Shares to be offered on a delayed or continuous basis.

 

(q)The Company is covered
by insurance in such amounts and covering such risks as is adequate for the conduct of its business and the value of its properties
and as is customary for companies engaged in similar businesses in similar industries.

 

(r)
The Company is not, and after consummation of the Reverse Merger the Public Parent will not be, an “investment company”
or an “affiliated person” of, or “promoter” or “principal underwriter” for, an investment company
within the meaning of the Investment Company Act of 1940, as amended.

 

(s)Each of the Company
and the Public Parent has complied with all federal, state, local, and foreign laws, ordinances, administrative or government rules
or regulations, and of any decree of any court or governmental agency or body having jurisdiction over the Company or the Public
Parent, as applicable, except where the failure to comply with any such laws or requirements has not, and will not, have a Material
Adverse Effect.

 

(t)Neither
the Company nor the Public parent, nor, to the Company’s knowledge, any director, officer, agent, employee or
affiliate of the Company or the Public Parent, nor any other person acting on behalf of the Company or the Public Parent,
has, directly or indirectly, given or agreed to give any money, gift or similar benefit (other than legal price concessions
to customers in the ordinary course of business) to any customer, supplier, employee or agent of a customer or supplier, or
official or employee of any governmental agency or instrumentality of any government (domestic or foreign) or any political
party or candidate for office (domestic or foreign) or other person who was, is, or may be in a position to help or hinder
the business of the Company (or assist it in connection with any actual or proposed transaction) that would be reasonably
likely to pose a material risk of subjecting the Company or the Public Parent to any damage or penalty in any civil, criminal
or governmental litigation or proceeding. Each of the Company the Public Parent has taken reasonable steps to ensure that its
accounting controls and procedures are sufficient to cause the Company and the Public Parent to comply in all material
respects with the Foreign Corrupt Practices Act of 1977.

 

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(u)Neither the Company
nor the Public Parent nor, to the Company’s knowledge, any director, officer, agent, employee or affiliate of the Company
or the Public Parent or any other person acting on behalf of the Company or the Public Parent, is currently subject to any U.S.
sanctions administered by the Office of Foreign Assets Control of the U.S. Department of the Treasury (“OFAC”),
and the Company will not, directly or indirectly, use the proceeds of the Offering hereunder, or lend, contribute or otherwise
make available such proceeds to any subsidiary, joint venture partner or other person or entity, for the purpose of financing the
activities of any person currently subject to any U.S. sanctions administered by OFAC.

 

(v)The
operations of the Company and its the Public Parent 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 jurisdictions, the rules and regulations thereunder and any related or similar rules, regulations or
guidelines, issued, administered or enforced by any governmental entity (collectively, the “Money Laundering Laws”);
and no action, suit or proceeding by or before any governmental entity involving the Company or the Public Parent with respect
to the Money Laundering Laws is pending or, to the best knowledge of the Company, threatened.

 

(w)The Company maintains,
and the Public Parent will maintain, a system of internal accounting controls sufficient to provide reasonable assurances that
(i) transactions are executed in accordance with management’s general or specific authorizations; (ii) transactions are recorded
as necessary to permit preparation of financial statements in conformity with generally accepted accounting principles and to maintain
accountability for assets; (iii) access to assets is permitted only in accordance with management’s general or specific authorizations;
and (iv) the recorded accountability for assets is compared with existing assets at reasonable intervals and appropriate action
is taken with respect to any material differences.

 

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(x)There are no business
relationships or related party transactions involving the Company or the Public Parent except transactions on terms that are not
materially less favorable to the Company or the Public Parent than could have been obtained in an arms-length transaction with
unrelated third parties and investments by officers or directors in the Company and as otherwise previously disclosed to the Placement
Agent.

 

(y)The board of directors
of the Company are Nicholas Mitsakos, Frank C. Herringer and David G. Watumull. It is expected that the board of directors of the
Public Parent upon the consummation of the Reverse Merger will be the same individuals.

 

Section 5.Representations
and Warranties of the Placement Agent. The Placement Agent represents and warrants to the Company as follows:

 

(a)The
Placement Agent is duly registered pursuant to the provisions of the Exchange Act, as a broker-dealer and is in good
standing with the Financial Industry Regulatory Association (“FINRA”) and is duly registered as a
broker-dealer in those states in which the Placement Agent is required to be so registered in order to carry out the Offering
contemplated hereby, and there are no orders issued or, to the knowledge of the Placement Agent, proposed to be issued
against the Placement Agent by FINRA or any state or other regulatory authority having jurisdiction over the Placement Agent
that would prevent it from conducting the Offering contemplated hereby.

 

(b)The
execution and delivery of this Agreement and the performance by the Placement Agent of its obligations hereunder have been duly
and validly authorized by the Placement Agent, and this Agreement has been duly executed and delivered by the Placement Agent
and constitutes the valid and legally binding agreement of the Placement Agent, enforceable against the Placement Agent in accordance
with its terms.

 

(c)The Placement Agent
is a duly organized and validly existing corporation partnership under the laws of the State of California.

 

(d)The
disclosure regarding the Placement Agent or its principals in the Subscription Agreement accurately discloses all actions or
matters referred to in Section 506(d) of Regulation D with respect to the Placement Agent or any person that has been or will
be paid (directly or indirectly) remuneration for solicitation of purchasers in connection with such sale of securities in
the Offering that is associated with, an executive officer or owner of the Placement Agent.

 

Section 6.Covenants
of the Company. The Company covenants and agrees with the Placement Agent, for the benefit of the Placement Agent and
the Purchasers, as follows:

 

    	11

    	 

    

 

(a)Each certificate, if
any, evidencing the Convertible Notes, the Note Shares, the Warrants or the Warrants Shares, or, if applicable, any advice from
the Company’s transfer agent evidencing the ownership of any such securities in book- entry form on the records of the transfer
agent’s Direct Registration System or otherwise, shall, until such time as the same is no longer required under the applicable
requirements of the Securities Act, bear substantially the following legend (along with such other legends as the Placement Agent
and its counsel reasonably deem necessary), and the Company shall cause its transfer agent to issue stop transfer instructions
with respect to such securities:

 

“THE SECURITIES
[EVIDENCED BY THIS CERTIFICATE] [DESCRIBED HEREIN] HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 (THE “ACT”)
OR APPLICABLE STATE SECURITIES LAWS (THE “STATE ACTS”), AND MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED, PLEDGED
OR HYPOTHECATED UNLESS AND UNTIL REGISTERED UNDER THE ACT, THE STATE ACTS AND ANY OTHER APPLICABLE SECURITIES LAWS UNLESS, IN THE
WRITTEN OPINION OF COUNSEL SATISFACTORY TO THE COMPANY, WHICH OPINION SHALL BE IN FORM AND SUBSTANCE SATISFACTORY TO THE COMPANY,
SUCH OFFER, SALE, TRANSFER, PLEDGE OR HYPOTHECATION IS EXEMPT FROM REGISTRATION OR IS OTHERWISE IN COMPLIANCE WITH THE ACT, THE
STATE ACTS AND ANY OTHER APPLICABLE SECURITIES LAWS.”

 

(b)During the course
of the Offering, until the Closing Date, except to the extent agreed by the Placement Agent, the Company shall not, and the Company
shall cause the Public Parent not to, make any offers, offers to sell, offers of sale or sales of the shares (or any notes, warrants,
stock or other securities of or interests in the Public Parent) other than in accordance with the terms hereof or in connection
with the Concurrent Offering or to current investors in Holdings.

 

(c) The Company will apply
the net proceeds from the sale of the Convertible Notes as described in the Subscription Agreement.

 

(d)Until the Closing
Date, and thereafter with specifically respect to the Offering, the Company will not issue any press release, grant any interview,
or otherwise communicate with the media in any manner whatsoever without the Placement Agent’s express prior written consent,
which shall not be unreasonably withheld. Notwithstanding the foregoing, the Company may make any press release or other statements
that it reasonably believes is consistent with the obligations of a public company.

 

(e)The
Company acknowledges that the Placement Agent and its affiliates are in the business of, among other things, providing financial
advisory and consulting services and agrees that the provision of such services to other persons and entities (including, but
not limited to, a direct and/or indirect competitor of the Company or the Public Parent), shall not constitute a breach of any
duty owed to the Company or the Public Parent by virtue of this Agreement or otherwise.

 

    	12

    	 

    

 

Section 7. Expenses
of Sale. In addition to payment of certain of the Placement Agent’s legal fees and expenses as contemplated in
Section 3(f) hereof, the Company shall bear all other fees, disbursements and expenses in connection with the Offering and
the matters contemplated hereby, including, without limitation, the Company’s legal and accounting fees and disbursements,
the costs of issuing Convertible Notes and the underlying securities, the fees and expenses of any transfer agent or registrar
for the Convertible Notes and the underlying securities, reasonable costs and expenses of qualifying or exempting the Offering
under the “Blue Sky” laws of the states specified by the Placement Agent or the Company, and the costs related to the
Company management’s participation in any roadshow or investor presentations (including slides, consultants, travel and lodging
expenses of representatives and officers of the Company, aircraft and other transportation costs).

 

Section 8.Conditions
to the Placement Agent’s Closing Obligations. The Placement Agent’s obligations to direct the Escrow Agent
to release funds for the Closing shall be subject to the accuracy of and compliance with, as of the date hereof and as of the date
of such Closing, the Company’s representations, warranties and covenants contained in Sections 2 and 4 hereof,
the performance by the Company of its obligations hereunder required to be performed on or before such Closing, and to the following
further conditions:

 

(i)Since September 30,
2013, there shall not have occurred any material and adverse change, or any development involving or which would reasonably be
expected to involve a potential future material and adverse change, in the condition (financial or other), business, properties,
net worth prospects or results of operations of the Company or the Public Parent.

 

(ii)The Placement Agent
shall have received (for its benefit and the benefit of the Purchasers) an opinion, dated as of the date of the Closing, of the
law firm of Herrick Feinstein LLP (“Company Counsel”), coveringsuch customary corporate matters (pertaining
to the Company) regarding corporate existence and good standing, authorizations, validity, enforceability, no violations and the
like, as to the absence of a requirement to register the Securities under the Securities Act and with respect to any such other
matters as the Placement Agent may reasonably request.

 

(iii)The
Placement Agent shall have received a certificate, dated the date of the Closing, from the Chief Executive Officer of the
Company with respect to certain corporate matters, confirming the continued accuracy of the Company’s representations
and warranties hereunder and the performance by the Company with the agreements and covenants required to be performed at or
prior to the date of such certificate and with respect to other customary matters satisfactory in form and substance to the
Placement Agent and its counsel (the foregoing, an “Officers Certificate”).

 

    	13

    	 

    

 

(iv)The Company shall
have furnished to the Placement Agent such further certificates and documents as the Placement Agent shall reasonably request.

 

Section 9.Conditions
to the Company’s Closing Obligations. The obligations of the Company shall be subject to the accuracy of and compliance
with, as of the date hereof and on each Closing Date, the representations, warranties and covenants contained in Sections 2
and 5 hereof.

 

Section 10.Non-Solicitation and “Tail.”

 

(a)
For a period of 24 months from the date of the final Closing under the Offering (the “Non-Solicitation
Period”), the Company shall not, and it shall cause each of its subsidiaries and other affiliates not to, solicit
any offer to buy from or offer to sell to any of the persons (individuals and/or entities) first introduced to the Company by
the Placement Agent who are Purchasers under the Subscription Agreement (the “Covered Investors”), any
securities of the Company or of any subsidiary or other affiliate or any other person or entity, either directly or
indirectly through any selling agent, placement agent, broker or dealer or other person or entity, without, in each case,
providing for and making the payment of the compensation to the Agent described in Section 10(c) hereof. The Company
agrees that the Placement Agent shall be entitled to the Placement Agent Fee and Placement Agent Warrants (or (if applicable)
a cash fee and warrants as near as possible thereto) with respect to any securities of the Company or the successor or (as
applicable) the securities of any other entity that are sold during the Non-Solicitation Period as a result of any such
solicitation to any of the Covered Investors.

 

(b)During the Non-Solicitation
Period, the Company shall not give the names or other information of the Covered Investors to any other broker dealer or selling
or placement agent; provided, however, it shall not be a violation of this provision if the Company includes the names and other
information regarding the Covered Investors in any public filing made by the Company as may be required by law, including but not
limited to filings that the Company may make with Commission or if the Company provides the names of Covered Investors to persons
that are entitled to such information under applicable law (after appropriate demand or request by any such person, as applicable).
Without limitation of the foregoing, the Company shall cause its legal counsel and other representatives to use their best commercially
reasonable efforts to redact names and other identifying information from all closing binder materials prepared in connection with
the Offering.

 

(c)The Placement
Agent understands that: (i) Cardax may disclose information about Covered Investors to Agincourt, Ltd. but (ii) Agincourt may
not solicit such Covered Investors for securities transactions, it being acknowledged and agreed by the Placement Agent that
neither Holdings, the Company nor the Public Parent nor any of their respective affiliates shall be responsible for any
breach of clause (ii) of this paragraph by Agincourt, Ltd.

 

    	14

    	 

    

 

(d)Upon receipt of written
request by the Placement Agent, the Company shall promptly deliver to the Placement Agent the names of any persons with whom the
Company completes a subsequent financing within 24 months from the date of the Closing that were introduced to the Company by the
Placement Agent and who become investors in the Offering.

 

(e)This provision shall survive termination of
this Agreement.

 

(f)By
signing below, Agincourt, Ltd. agrees that it shall not, and it shall cause all of its affiliates, agents, sub-agents and
representatives not to, directly or indirectly solicit any offer to buy from, or offer to sell to, any of the persons
(individuals and/or entities) introduced to Cardax by the Agent who become investors in the Offering, any securities of any
person or entity (other than Cardax or its Successor as may be permitted under Section 10(a) hereof), either directly
or indirectly through any selling agent, placement agent, broker or dealer or other person or entity. Further Agincourt, Ltd.
shall not give the names or other information of the subscribers to any other broker dealer or selling or placement agent.
This provision shall survive termination of this Agreement. The Agent acknowledges and agrees that this Section 10(f)
is a separate covenant of Agincourt, Ltd. and that Cardax is not responsible for any breach hereof by Agincourt, Ltd.

 

(g)In the event that either
Cardax or Agincourt, directly or through any agent or other person, violates any provision applicable to them under this Section
10, the Placement Agent shall be entitled (in addition to any other rights the Placement Agent may have in law or equity) to
treble damages with respect to such violation which shall consist of three times the fee and three times the warrants that would
have been payable to the Agent if it had given its consent to such solicitation; provided, however, that such penalty shall not
be enforced if there is a good faith dispute by the Company as to whether such compensation is payable to Placement Agent and the
Company first offers to mediate (and then mediates) any dispute to determine whether such compensation is in fact payable with
JAMS or other mediation service reasonably specified by the Placement Agent and the dispute is amicably resolved in such mediation.

 

Section 11.Indemnification.

 

(a)The Company hereby
agrees to the provisions with respect to the indemnification of the Placement Agent and related parties and other matters set forth
in Annex I, which is incorporated herein by reference as if a part hereof. The Company’s obligations as set forth
in such Annex I shall survive any termination of this Agreement.

 

    	15

    	 

    

 

(b)All representations,
warranties, covenants and agreements of the Company and the Placement Agent herein or in certificates delivered pursuant hereto,
and the indemnity agreement contained in Section 11(a) hereof (and Annex A hereto), shall survive the execution and delivery
of this Agreement and the Closings and shall remain operative and in full force and effect regardless of any investigation made
by or on behalf of the Placement Agent or any controlling person thereof, the Company or any of its officers, directors, or any
controlling persons.

 

Section 12. Registration.

 

(a)As
promptly as possible after the Closing, and in any event on or prior to the seven-month anniversary of the effective date of
the Reverse Merger, the Company shall cause the Public Parent to prepare and file with the Commission, (prior to the filing
by the Public Parent of any other registration statement after the effective date of the Reverse Merger other than a
registration statement for the issuance of securities for cash or a registration statement on Form S-4), a registration
statement (the “Registration Statement”) covering the resale of all of the Note Shares and all of the
Warrant Shares, and such other outstanding shares of Public Parent Common Stock (and outstanding securities convertible,
exercisable or exchangeable for Public Parent Common Stock) as the Board of the Public Parent may determine in its
discretion. Such registration shall be for an offering to be made on a delayed or continuous basis pursuant to Rule 415 and
each holder of such registrable shares shall be required to provide such information as the Public Parent reasonably requires
for inclusion in such Registration Statement and shall sell such registered shares in accordance with the plan of
distribution provided in such Registration Statement. The obligations of the Public Parent to include Note Shares and Warrant
Shares or any other shares included in such Registration Statement in any such registration shall be subject to the
limitations of applicable law (which include comments by the Commission with respect to any such registration statement),
including without limitation, any restriction on the number of such shares so that such offering is not deemed an offering by
or on behalf of the Company or other restriction on the use of Rule 415 with respect to such registration statement (the
“Registration Limitation”). Subject to the Registration Limitation, the Company shall cause the
Public Parent to use its reasonable efforts to give priority to the Note Shares and the Warrant Shares equal to all other
securities included in the Registration Statement (for example, and without limitation, if by virtue of a Commission comment
the number of shares included in the Registration Statement must be reduced, then the number of shares of each holder whose
shares are included in the Registration Statement would be reduced by the same percentage, except where, by virtue of
Commission rules and regulations, the shares of different holders would be required to be treated differently and as a result
different percentages of shares would be accepted by the Commission in such registration statement).

 

(b)Subject
to the Registration Limitation and the last sentence of Section 12(a) hereof, the Company shall use its reasonable
efforts to cause the Registration Statement, or a successor registration statement, if applicable, to be declared effective
by the Commission as promptly as possible after the filing thereof, and shall use its reasonable efforts to keep the
Registration Statement, or a successor registration statement, if applicable, continuously effective under the Securities Act
until the date that all shares covered thereby have been sold or can be sold publicly under Rule 144 without volume
limitations by the holders of such shares assuming that such holders are not affiliates of the Public Parent as defined under
Rule 144.

 

    	16

    	 

    

 

(c)The Company shall
notify the Investors in writing promptly (and in any event within two trading days) after receiving notification from the Commission
that the Registration Statement has been declared effective.

 

(d)The Company shall
not, from the date hereof until the effective date of the registration statement referred to above, prepare and file with the Commission
a registration statement relating to an offering for its own account under the Securities Act of any of its equity securities,
unless such registration statement includes all of the Note Shares and Warrant Shares offered and sold hereby.

 

(e)With a view to making
available the benefits of certain rules and regulations of the Commission which may at any time permit the sale of the Note Share
and Warrant Shares to the public without registration or pursuant to a registration on Form S-3, assuming that the Reverse Merger
is effected in accordance with the terms of the Merger Agreement, the Company shall cause the Public Parent to use its reasonable
efforts to:

 

(i) Make and keep public
information available, as those terms are understood and defined in Rule 144, at all times;

 

(ii) File with the Commission
in a timely manner all reports and other documents required of the Company under the Securities Act and the Exchange Act; and

 

(iii)
Furnish to any Purchaser forthwith upon request a written statement by the Company as to its compliance with the reporting
requirements of Rule 144, the Securities Act and the Exchange Act, a copy of the most recent annual or quarterly report of
the Company, and such other reports and documents of the Company as a Purchaser may reasonably request in availing itself of
any rule or regulation of the Commission allowing a Purchaser to sell any such securities without registration.

 

Section
13. Termination. The appointment and authorization of the Placement Agent shall expire on the Closing but in
any event on January 4, 2014, unless such date is extended by written agreement of the Company and the Placement Agent. In
addition, either the Company or the Placement Agent shall have the right to terminate this Agreement at any time by giving
the other party at least 10 days prior written notice. Notwithstanding the foregoing, the provisions of Sections 3(f), 7, 11,
and 14 through 21 shall survive any expiration or any termination of this Agreement pursuant to this Section
13 or otherwise.

 

    	17

    	 

    

 

Section 14. Notices.
All notices or communications hereunder, except as herein otherwise specifically provided, shall be in writing and if given to
Placement Agent, shall be mailed, delivered via courier or by facsimile or e-mail to the parties at the following addresses:

 

If to the Placement Agent, to:

 

Portfolio Advisor Alliance,
Inc.

330 Madison Avenue, 6th
Floor

New York, New York 10017

Telephone: 212-812-8900

Facsimile: 212-867-1993

E-Mail: kwasserman@allenps.com

Attention: Ms. Kerri
Wasserman, 

                   Chief Compliance Officer

 

 

With a copy to:

 

Timothy I. Kahler, Esq.
 

Troutman Sanders,

LLP The Chrysler Building

405 Lexington Avenue

New York, New York 10174

Telephone: (212) 704-6169

Fax: (212) 704-5948

E-Mail: timothy.kahler@troutmansanders.com

 

If to the Company, to: 

Cardax Pharma, Inc.

2800 Woodlawn Drive,
Suite 129

Honolulu, Hawaii 96822

Telephone: (808) 457-1400

Facsimile: (808) n237-1509

E-Mail: DWatamull@cardaxpharma.com

Attention: Mr. David G.
Watamull,

    President and Chief Executive Officer

 

    	18

    	 

    

 

With a copy to:

 

Richard M. Morris, Esq.

Herrick, Feinstein
LLP

2 Park Avenue

New York, New York 10016

Telephone:(212) 592-1432

Facsimile:(212) 545-3371

Email: RMorris@Herrick.com

 

The Company or the Placement
Agent may change its address for receiving notices by giving written notice to the other party.

 

Section
15.Parties. This Agreement shall inure to the benefit of and be binding upon the Placement Agent and the Company, and
each of their respective successors and assigns. In addition, the representations and warranties of the Company under Section
4 and the covenants of the Company in Section 6 hereof and Section 12 hereof shall also be for the direct benefit
of the Purchasers, each of whom shall be an intended third party beneficiary of this Agreement for such purposes and shall have
the right to enforce this Agreement directly against the Company. Nothing expressed or mentioned in this Agreement is intended
or shall be construed to give any person or corporation, other than the parties hereto and their respective successors and assigns,
controlling persons, officers and directors and counsel referred to in this Agreement, any legal or equitable right, remedy or
claim under or in respect to this Agreement or any provision herein contained.

 

Section 16. Severability.
Every provision in this Agreement is intended to be severable. If any term or provision hereof is illegal or invalid for any reason
whatsoever, such illegality or invalidity shall not affect the validity of the remainder hereof.

 

Section 17. Captions.
The captions or headings in this Agreement are inserted for convenience and identification only and are in no way intended
to describe, interpret, define, or limit the scope, extent, or intent of this Agreement or any provisions hereof.

 

Section 18. Applicable
Law. This Agreement shall be governed by, construed and interpreted under the law of the state of New York other than
any provision thereof that would result in the application of the law of any other jurisdiction; for the avoidance of doubt, this
choice of governing and applicable law is made in reliance on Sections 5-1401 and 5-1402 of the New York General Obligations Law.

 

Section
19. Prior Agreements. This Agreement is the entire agreement of the parties with respect to the subject matter
hereof and supersedes all prior agreements, verbal or written, covering such subject matter, including the Financial
Representative Agreement dated November 8, 2013, as amended.

 

    	19

    	 

    

 

Section 20. Limitations.
The Company acknowledges and agrees that (i) the Placement Agent and its affiliates may be engaged in a broad range of transactions
that involve interests that differ from those of the Company, and (ii) the Placement Agent has not provided any legal, accounting,
regulatory or tax advice with respect to the Offering and the Company has consulted its own legal, accounting, regulatory and tax
advisors to the extent it deemed appropriate.

 

Section 21. Counterparts.
This Agreement may be executed in one or more counterparts and, if executed in more than one counterpart, the executed counterparts
shall each be deemed to be an original but all such counterparts shall together constitute one and the same instrument. The exchange
of copies of this Agreement and of signature pages by facsimile, e-mail or other electronic means shall constitute effective execution
and delivery of this Agreement by the parties hereto and may be used in lieu of the original signatures pages to this Agreement
for all purposes.

  

[The remainder of this
page is intentionally blank.]

 

    	20

    	 

    

 

If the foregoing correctly
sets forth our understanding, please so indicate in the space provided below for that purpose whereupon this letter shall constitute
a binding agreement between us.

 

	 	Very truly yours,
	 	 	 
	 	CARDAX PHARMA, INC.
	 	 	 	 
	 	By:	/s/ David G. Watumull
	 	 	Name:     	David G. Watumull
	 	 	Title:	President and
	 	 	 	Chief Executive Officer

 

CONFIRMED as of the date first set forth above.

 

	PORTFOLIO ADVIS RS ALLIANCE, INC.	 
	 	 	 	 
	By:  	 	 
	 	Name:  	Kerri Wasserman	 
	 	Title:	Chief Compliance Officer 

and Authorized Signatory	 

  

Agincourt Ltd. hereby consents and agrees to the
matters set forth in Section 10 above as of the date first set forth above.

 

	AGINCOURT LTD.	 
	 	 	 	 
	By:  	 	 
	 	Name:  	James J. Cahill	 
	 	Title:	Managing Director	 

 

[Signature Page to Placement Agent Agreement]

 

    	21

    	 

    

  

If
the foregoing correctly sets forth our understanding, please so indicate in the space provided below for that purpose whereupon
this letter shall constitute a binding agreement between us.

 

	 	Very truly yours,
	 	 	 
	 	CARDAX PHARMA, INC.
	 	 	 	 
	 	By:	
	 	 	Name:     	David G. Watumull
	 	 	Title:	President and
	 	 	 	Chief Executive Officer

 

CONFIRMED as of the date first set forth above.

 

	PORTFOLIO ADVIS RS ALLIANCE, INC.	 
	 	 	 	 
	By:  	/s/ Kerri Wasserman	 
	 	Name:  	Kerri Wasserman	 
	 	Title:	Chief Compliance Officer 

and Authorized Signatory	 

  

Agincourt Ltd. hereby consents and agrees to the
matters set forth in Section 10 above as of the date first set forth above.

 

	AGINCOURT LTD.	 
	 	 	 	 
	        	 	 
	 	Name:  	 	 
	 	Title:	 	 

 

[Signature Page
to Placement Agent Agreement]

 

    	22

    	 

    

 

If the foregoing correctly
sets forth our understanding, please so indicate in the space provided below for that purpose whereupon this letter shall constitute
a binding agreement between us.

 

	 	Very truly yours,
	 	 	 
	 	CARDAX PHARMA, INC.
	 	 	 	 
	 	By:	
	 	 	Name:     	David G. Watumull
	 	 	Title:	President and
	 	 	 	Chief Executive Officer

 

CONFIRMED as of the date first set forth above.

 

	PORTFOLIO ADVIS RS ALLIANCE, INC.	 
	 	 	 	 
	By:  	 	 
	 	Name:  	Kerri Wasserman	 
	 	Title:	Chief Compliance Officer 

and Authorized Signatory	 

  

Agincourt Ltd. hereby consents and agrees to the
matters set forth in Section 10 above as of the date first set forth above.

 

	AGINCOURT LTD.	 
	 	 	 	 
	By:  	/s/ James J. Cahill	 
	 	Name:  	James J. Cahill	 
	 	Title:	Managing Director	 

 

[Signature Page to Placement Agent Agreement]

  

    	23

    	 

    

  

ANNEX A

 

This
Annex A is attached to and incorporated by reference into the Placement Agent Agreement (the “Agreement”) between
the Company, Inc., a Delaware corporation (the “Company”), and Portfolio Advisors Alliance, Inc., a California
corporation (the “Placement Agent”), dated January 3, 2014. Capitalized terms used herein and not otherwise
defined herein shall have the meanings assigned to such terms in the Agreement.

 

The Company
hereby agrees to indemnify and hold harmless the Placement Agent and its affiliates, and the respective directors, officers, partners,
controlling persons (within the meaning of Section 15 of the Securities Act of 1933, as amended, or Section 20 of the Securities
Exchange Act of 1934, as amended), agents, sub-agents, and employees of the Placement Agent or any of its affiliates (the Placement
Agent and each such other person or entity being referred to individually as an “Indemnified Person”
and, collectively, as “Indemnified Persons”), to the fullest extent lawful, from
and against any and all Damages (as hereinafter defined) directly or indirectly related to or arising out of the Offering,
the Convertible Notes sold therein and the Note Shares and Warrant Shares that may be issued upon the conversion of the Convertible
Notes (together with the Convertible Notes, the “Securities”) or any information contained in the Offering Materials
or otherwise provided by the Company, the Company's employees or other agents, which either the Company or an Indemnified Person
provides to any person or entity, or otherwise directly or indirectly in connection with, arising out of, based upon, or in any
way related to the engagement of the Placement Agent under the Agreement or any transaction, thing or conduct in connection therewith,
including without limitation the Offering and the Securities. The Company will not, however, be responsible for any Damages, or
any associated counsel fees or expenses, that are finally determined in the manner specified by the Agreement (and not subject
to further review) to have resulted from the Placement Agent’s or other Indemnified Person’s bad faith, willful misconduct
or gross negligence.

 

“Damages”
means any and all losses, Actions (as hereinafter defined), damages, judgments, assessments,
investigation costs, settlement costs, fines, penalties, arbitration awards and any other liabilities, costs, fees and expenses,
including without limitation all documented out of pocket costs and expenses, including reasonable counsel fees and disbursements,
in connection with investigating, preparing for and defending any Action to which the Placement Agent or any other Indemnified
Person is named as a party or is reasonably anticipated to become a party thereto, whether or not in connection with any pending
or threatened Action, caused by or arising out of or in connection with the Placement Agent acting pursuant to the Agreement or
otherwise relating to the Offering or the Securities.

 

    	AA-1

    	 

    

 

“Action”
means any formal or informal action, case, claim, litigation, appeal, hearing, inquest, investigation, arbitration, mediation,
inquiry or other proceeding (including, without limitation, stockholder actions).

 

If multiple
claims are brought against an Indemnified Person, with respect to at least one of which indemnification is permitted under applicable
law and provided for under the terms of this Annex A, the Company agrees that all Damages associated therewith, including any judgment
or award against such Indemnified Person in connection therewith, shall be conclusively deemed to be based on claims as to which
indemnification is permitted and provided for hereunder, except to the extent the judgment or award expressly states that it, or
any portion thereof, is based on a claim as to which indemnification is not available.

 

The Company
also agrees that neither the Placement Agent nor any other Indemnified Person shall have any liability to the Company for, in connection
with or arising out of the engagement of the Placement Agent under the Agreement except for any such liability for Damages, including
attorneys fees, incurred by the Company that are finally determined in the manner specified by the Agreement (and not subject to
further review) to have resulted from the Placement Agent’s or other Indemnified Person’s bad faith, willful misconduct
or gross negligence.

 

In
no event shall the Company or any Indemnified Person be responsible for any special, indirect or consequential damages
incurred by the other; provided that nothing in this sentence shall be deemed to (i) relieve the Company of any obligation it
may otherwise have hereunder to indemnify an Indemnified Person for any such damages asserted by an unaffiliated third party
or (ii) relieve the Placement Agent of any liability it may otherwise have hereunder to the Company for any such damages
which the Company becomes legally obligated to pay to an unaffiliated third party.

 

In the
event that the foregoing indemnity is unavailable (except by reason of the bad faith, willful misconduct or gross negligence of
the Placement Agent or an Indemnified Party), then the Placement Agent and the Company shall contribute to amounts paid or payable
by the Indemnified Parties, in respect of the Damages sustained or incurred by the Indemnified Parties, in such proportion as appropriately
reflects the relative benefits received by, and the relative fault of, the Placement Agent and the Company in connection with the
matters as to which such Damages relate and other equitable considerations; provided, however, that in no event shall the amount
to be contributed by the Placement Agent exceed the amount of the Placement Agent Fees actually received by the Placement Agent
in cash from the Company under the terms of the Agreement.

 

The
Company will not, without the Placement Agent’s prior written consent (which shall not be unreasonably withheld),
consent to the entry of any judgment in or otherwise seek to terminate any Action in respect of which indemnification may be
sought hereunder (if any Indemnified Person is a party, or reasonably anticipated to become a party, thereto) unless such
settlement, compromise, consent or termination includes an unconditional release of each Indemnified Person from all Damages
arising out of such Action. No Indemnified Person seeking indemnification, reimbursement or contribution hereunder will,
without prior written consent the Company, which consent shall not be unreasonably withheld, settle, compromise, consent to
the entry of any judgment in or otherwise seek to terminate any Action in respect of which indemnification may be sought
hereunder.

 

    	AA-2

    	 

    

 

Promptly
after receipt by an Indemnified Person of notice of its involvement in any Action, the Placement Agent shall, if a claim for indemnification
in respect thereof is to be made against the Company hereunder, notify the Company of such involvement; provided, however, that
the failure to so notify the Company shall not relieve the Company of any liability that it may have under the provisions of this
Annex A except to the extent that it has been prejudiced in any material respect by such failure, or from any liability which it
may otherwise have to the Indemnified Parties.

 

If an
Indemnified Person is entitled to indemnification under this Annex A with respect to any action or proceeding brought by a third
party, the Company shall be entitled to assume the defense of any such action or proceeding with counsel reasonably satisfactory
to the Indemnified Person. Upon assumption by the Company of the defense of any such action or proceeding, the Indemnified Person
shall have the right to participate in such action or proceeding and to retain its own counsel, but the Company shall not be liable
for any legal expenses of other counsel subsequently incurred by such Indemnified Person in connection with the defense thereof
unless the Company shall have failed to employ counsel reasonably satisfactory to the Indemnified Person in a timely manner. the
Company shall not have any obligation to pay for more than one counsel of the Indemnified Persons.

 

    	AA-3Exhibit 10.17

 

PORTFOLIO ADVISORS ALLIANCE, INC.

330 Madison Avenue, 6th Floor

New York, New York 10016

Tel.: (212) 812-8900 / (800) 804-2595

Fax: (212) 867-1993

 

	 	January 3, 2014

 

Cardax Pharma, Inc.

2800 Woodlawn Drive, Suite 129

Honolulu, Hawaii 96822

		Attention:	Mr. David G. Watumull,

President and Chief Executive Officer 

 

Re:  Financial Consulting Agreement

 

Dear Mr. Watumull:

 

This financial consulting
agreement (this “Agreement”) sets forth the terms upon which Cardax Pharma, Inc., a Delaware corporation (and
unless the context otherwise requires, from and after the Commencement Date (as hereinafter defined), PubCo, including any of their
respective successors thereto, the “Company”), shall engage Portfolio Advisors Alliance, Inc., a California
corporation (the “Consultant”), which is a registered broker-dealer and a member of the Financial Industry Regulatory
Authority, on a non-exclusive basis and during the Term (as hereinafter defined) to perform services related to financial consulting
and public relations matters as more particularly set forth herein. We acknowledge that our non-exclusive right to act as the Company’s
financial and public relations advisor is with the consent of Agincourt Ltd. (which consent is evidenced by its signature below)
whose prior existing commitment from the Company to serve as the Company’s exclusive financial advisor will continue in effect
following the termination of the Consultant’s services hereunder. In addition, with the consent of Agincourt, Ltd., the Consultant
is, concurrently herewith, entering into a Placement Agent Agreement relating to the Consultant’s services as placement agent
for a private placement (the “Private Placement”) of securities of the Company.

 

1.          Services.
Commencing on the Commencement Date, the Consultant shall act as a non-exclusive advisor to the Company with respect to financial
and public relations matters, and in that capacity the Consultant shall perform such services related to financial and public relations
matters (the “Services”) as may be reasonably requested by the Company from time to time, which services may
include, but will not necessarily be limited to:

 

    	 

    	 

    

 

(a)          advice
regarding obtaining financing, including introducing the Company to accredited investors, which may be corporations, partnerships,
mutual funds, hedge funds, investment partnerships, securities firms, lending and other institutions and entities, as well as select
high net worth individuals for the purposes of providing financing in the form of equity or equity-linked securities of the Company
or a combination of the foregoing (a “Corporate Financing Transaction”);

 

(b)          advice
regarding the financial structure of the Company or its divisions or any programs and projects undertaken by any of the foregoing;

 

(c)          counsel
to the Company regarding its overall strategy and related activities within the financial community;

 

(d)          advice
regarding proposed press releases by the Company;

 

(e)          assistance
to the Company with the preparation and revision of presentation materials for meetings with the investment community; and

 

(f)          such
other services as the Company may reasonably request of the Consultant from time to time.

 

In addition, from time
to time, subject to scheduling availability, the Consultant shall:

 

		(i)	meet with the financial community on behalf of Company;

 

		(ii)	survey key analysts, brokers and institutional investors:

 

		(iii)	arrange meetings between Company’s senior management
and members of the financial community, including individual meetings, informal group meetings and formal presentations.

 

2.          Performance
of Services. The Consultant shall provide the Services requested by Company at times determined in the reasonable good faith
discretion of the Consultant, giving due regard to the timing needs of the Company and the reasonable scheduling and other commitments
of the Consultant. Such services shall be provided in person, by telephone, by email or by such other means as the Consultant shall
reasonably determine in good faith. The Company and the Consultant agree that the Services to be provided hereunder by the Consultant
are not exclusive, that the Company has existing relationships and is free to pursue new relationships with other financial advisors,
and that the Consultant has other business obligations, including providing financial advisory and consultant services to others.
The Company agrees that the provision of such services shall not constitute a breach hereof of any duty owed to the Company by
virtue of this Agreement and that the provision of similar financial advisory service by other advisors to the Company shall not
constitute a breach hereof of any duty owed by the Company to the Consultant by virtue of this Agreement. Nothing contained herein
shall be construed to limit or restrict the Consultant in conducting such businesses with respect to others or in rendering such
services to others.

 

    	2

    	 

    

 

3.          Relationship
of the Parties. The Consultant shall be, and at all times during the Term (as hereinafter defined) shall remain, an independent
contractor. As such, the Consultant shall determine the means and methods of performing the Services hereunder and shall render
the Services at such places and by such means as it determines.

 

4.          Expenses.
The Company shall pay all -approved reasonable costs and expenses incurred by the Consultant that were pre-approved by the Company
in the performance of its duties hereunder, including but not limited to reasonable and documented travel, legal fees and other
expenses. The Consultant will not bear any of the Company’s legal, accounting, printing or other expenses in connection with
any transaction considered or consummated hereby. It also is understood that neither the Consultant, nor any of its officers, directors,
employees or agents, will be responsible for any fees or commissions payable to any finder or to any other financial or other advisor
utilized or retained by the Company.

 

5.          Compensation.
As the compensation to the Consultant for its services hereunder, the Company shall cause to be issued to the Consultant, on the
Commencement Date, five-year warrants to purchase four hundred thousand (400,000) shares of the common stock of PubCo (as hereinafter
defined), which warrants will have an exercise price equal to the unit purchase price in the Private Placement (expected to be
$0.625 per share), will have a cashless exercise feature, and will provide customary anti-dilution protection for structural changes
in the issuer’s capitalization. The form of the warrant is attached hereto.

 

6.          Additional
Services. Should Company desire the Consultant to perform additional services not outlined herein, Company may make such request
to the Consultant in writing. The Consultant may agree to perform those services at its sole discretion and may enter into additional
definitive agreements with the Company which shall set forth the Consultant’s obligations in connection with such transactions,
as well as the compensation to be paid the Consultant with respect to its additional services.

 

7.          Term.
This Agreement shall commence on the date (if any, the “Commencement Date”) of the consummation of the merger
contemplated by that certain merger agreement dated as of November 27, 2013, as the same may be amended, by and between the Company,
Koffee Korner, Inc., a Delaware corporation (“PubCo”), and Cardax Pharmaceuticals, Inc., that provides for the
merger of the Company with a wholly owned subsidiary of PubCo (“PubCo Sub”), and shall remain in effect for
twelve (12) months from the Commencement Date.

 

    	3

    	 

    

 

8.         Confidentiality.
The Non-Disclosure Agreement between the Company and the Consultant dated as of November 5, 2013 shall remain in full force
and effect following the execution and delivery of this Agreement.

 

9.         Indemnification.
The Company shall indemnify the Consultant in accordance with the provisions of Annex A hereto, which is incorporated by reference
and made a part hereof.

 

10.       Limitation
Upon the Use of Advice and Services. Use of the Consultant’s name requires the prior written approval of the Consultant
unless the Company is required by law to include the Consultant’s name in annual filings, other report or release of the
Company, in which event the Company shall furnish to the Consultant copies of such annual reports or other reports or releases
using the Consultant’s name in advance of publication by the Company.

 

11.       Cooperation.
The Company will cooperate with and will furnish the Consultant or entities introduced by the Consultant with all reasonable information
and data concerning the Company which the Consultant considers appropriate and will provide the Consultant with reasonable access
to the Company’s officers, directors, employees, independent accountants and legal counsel. The Company represents that all
information provided to the Consultant for distribution to investors will be complete and correct in all material respects. Notwithstanding
anything set forth above to the contrary, the Consultant shall not be responsible for any due diligence investigation of the Company
on behalf of any other party in connection with its services hereunder or in connection with any Corporate Finance Transaction.

 

12.       Termination.
This Agreement may be terminated at any time prior to the expiration of the Term by Consultant upon five (5) days prior written
notice to the Company if there a breach or default by the Company and by the Company upon five (5) days prior written notice to
Consultant for any breach or default by Consultant or by the mutual consent of . In the event of any such termination, this engagement
letter shall terminate and shall be of no further force and effect except that (i) Consultant shall be entitled to retain the warrants
issued to it pursuant to paragraph 5 hereof and receive reimbursement for expenses it has incurred up to the date of such termination
in accordance with Paragraph 5 hereof and (ii) the sections headed “Confidentiality,” “Indemnification,”
“Limitation,” and “Miscellaneous,” will survive.

 

13.       Miscellaneous.

 

(a)          Successors
and Assigns. Except as otherwise provided in this Agreement, no party hereto shall assign this Agreement or any rights or obligations
hereunder without the prior written consent of the other party hereto, and any such attempted assignment without such prior written
consent shall be void and of no force and effect. This Agreement shall inure to the benefit of and shall be binding upon the successors
and permitted assigns of the parties hereto. Anything to the contrary notwithstanding, the Company shall cause all of its obligations
hereunder, including its obligations under Annex A hereto, to be binding upon and enforceable directly against PubCo.

  

    	4

    	 

    

 

(b)          Notices.
All notices and other communications given or made pursuant hereto shall be in writing and shall be delivered by overnight courier
to the parties at the following addresses (or at such other address for a party as shall be specified by like changes of address
which shall be effective upon receipt) or sent by electronic transmission, with confirmation received:

 

If to the Consultant, to:

 

Portfolio Advisor Alliance, Inc.

330 Madison Avenue, 6th Floor

New York, New York 10017

Telephone: 212-812-8900

Facsimile: 212-867-1993

E-Mail: kwasserman@allenps.com

		Attention:	Ms. Kerri Wasserman,

Chief
Compliance Officer

 

With a copy to:

 

Timothy I. Kahler, Esq.

Troutman Sanders, LLP

The Chrysler Building

405 Lexington Avenue

New York, New York 10174

Telephone: (212) 704-6169

Fax: (212) 704-5948

E-Mail: timothy.kahler@troutmansanders.com

 

If to the Company, to:

 

Cardax Pharma, Inc.

2800 Woodlawn Drive, Suite 129

Honolulu, Hawaii 96822

Telephone: (808) 457-1400

Facsimile: (808) n237-1509

E-Mail: DWatumull@cardaxpharma.com

		Attention:	Mr. David G. Watumull,

      President
and Chief Executive Officer

 

    	5

    	 

    

 

With a copy to:

 

Richard M. Morris, Esq.

Herrick, Feinstein LLP

Two Park Avenue

New York, New York 10016

Telephone: (212) 592-1432

Fax: (212) 592-1500

E-Mail: rmorris@herrick.com

 

(c)          Applicable
Law; Arbitration. This Agreement shall be deemed to have been made and delivered exclusively in New York, New York and shall
be governed as to validity, interpretation, construction, effect and in all other respects solely and exclusively by the internal
laws of the State of New York without regard to principles of conflicts of law thereof. Any and all disputes, controversies or
claims arising out of or relating to this Agreement, or the breach, termination or invalidity thereof, shall be finally and exclusively
resolved by arbitration in accordance with the Rules of FINRA as at present in force. The parties hereto exclusively and irrevocably
agree that arbitration shall take place in New York, New York. The parties hereby irrevocably submit themselves to the sole and
exclusive jurisdiction of the arbitration tribunal in New York, New York under the auspices of FINRA. The award of the arbitrators
may include, without limitation, one or more of the following: a monetary award, a declaration of rights, an order of specific
performance, an injunction, reformation of the contract. The decision of the arbitrators shall be final and binding upon the parties
hereto, and judgment on the award may be entered in any court having jurisdiction over the subject matter thereof. The cash expenses
of the arbitration (including without limitation reasonable fees and expenses of counsel, experts and consultants) shall be borne
by the party against whom the decision of the arbitrators is rendered; provided that if a party prevails only partially, such party
shall be entitled to be reimbursed for such costs and expenses in the proportion that the dollar amount successfully claimed by
the prevailing party bears to the aggregate dollar amount claimed.

 

(d)          Counterparts.
This Agreement and any amendments, waivers, consents, or supplements may be executed in one or more counterparts, each of which
when so executed and delivered shall be deemed an original, but all of which counterparts together shall constitute but one and
the same instrument. Delivery of an executed counterpart of a signature page to this Agreement, any amendments, waivers, consents
or supplements, by facsimile or by email of a pdf or similar copy shall be as effective as delivery of a manually executed counterpart
thereof.

 

(e)          No
Waiver, Etc. No provision of this Agreement may be changed or terminated except by a writing signed by the party or parties
to be charged therewith. Any party hereto may waive compliance by the other with any of the terms, provisions and conditions set
forth herein; provided, however, that any such waiver shall be in writing specifically setting forth those provisions waived thereby.
No such waiver shall be deemed to constitute or imply a waiver of any other term, provision or condition of this Agreement.

 

    	6

    	 

    

 

(f)          Entire
Agreement. This Agreement contains the entire agreement between the parties hereto and is intended to supersede any and all
prior agreements between the parties relating to the same subject matter.

 

[The remainder of this page is intentionally
blank.]

 

    	7

    	 

    

 

If the foregoing is in accordance with your
understanding of our agreement, kindly sign and return this Agreement, whereupon it will become a binding agreement between the
Company and the Consultant in accordance with its terms as of the date first appearing above.

 

	 	Very truly yours,
	 	 
	 	PORTFOLIO ADVISORS ALLIANCE, INC.
	 	 	 
	 	By:	/s/ Kerri Wasserman
	 	Name:    Kerri Wasserman
	 	Title:      Chief Compliance Officer
	 	   and Authorized Signatory

 

Accepted and approved this Third (3rd) day of January 2014:

 

CARDAX PHARMA, INC.

 

	By:	/s/ David G. Watumull
	 	Name:	David G. Watumull
	 	Title:	President and Chief Executive Officer

 

Agincourt Ltd. hereby consents and agrees to the foregoing matters
as of the date first set forth above.

 

AGINCOURT LTD.

 

	By:	/s/ James J. Cahill
	 	Name:	James J. Cahill
	 	Title:	Managing Director

 

    	8

    	 

    

 

ANNEX A

 

This Annex A is attached
to and incorporated by reference into the Financial Consulting Agreement (the “Agreement”) between Cardax Pharma,
Inc., a Delaware corporation (the “Company”), and Portfolio Advisors Alliance, Inc., a California corporation
(the “Consultant”), dated January 3, 2013. Capitalized terms used herein and not otherwise defined herein shall
have the meanings assigned to such terms in the Agreement.

 

The Company hereby
agrees to indemnify and hold harmless the Consultant and its affiliates, and the respective directors, officers, partners, controlling
persons (within the meaning of Section 15 of the Securities Act of 1933, as amended, or Section 20 of the Securities Exchange Act
of 1934, as amended), agents, sub-agents, and employees of the Consultant or any of its affiliates (the Consultant and each such
other person or entity being referred to individually as an “Indemnified Person” and, collectively, as “Indemnified
Persons”), to the fullest extent lawful, from and against any and all Damages (as hereinafter
defined) directly or indirectly in connection with, arising out of, based upon, or in any way related to the engagement
of the Consultant under the Agreement or any transaction, thing or conduct in connection therewith. The Company will not, however,
be responsible for any Damages, or any associated counsel fees or expenses, that are finally determined in the manner specified
by the Agreement (and not subject to further review) to have resulted from the Consultant’s or other Indemnified Person’s
bad faith, willful misconduct or gross negligence.

 

“Damages”
means any and all losses, Actions (as hereinafter defined), damages, judgments, assessments,
investigation costs, settlement costs, fines, penalties, arbitration awards and any other liabilities, costs, fees and expenses,
including without limitation all documented out of pocket costs and expenses, including reasonable counsel fees and disbursements,
in connection with investigating, preparing for and defending any Action to which the Consultant or any other Indemnified Person
is named as a party or is reasonably anticipated to become a party thereto, whether or not in connection with any pending or threatened
Action, caused by or arising out of or in connection with the Consultant acting pursuant to the Agreement.

 

“Action”
means any formal or informal action, case, claim, litigation, appeal, hearing, inquest, investigation, arbitration, mediation,
inquiry or other proceeding (including, without limitation, stockholder actions).

 

If multiple claims
are brought against an Indemnified Person, with respect to at least one of which indemnification is permitted under applicable
law and provided for under the terms of this Annex A, the Company agrees that all Damages associated therewith, including any judgment
or award against such Indemnified Person in connection therewith, shall be conclusively deemed to be based on claims as to which
indemnification is permitted and provided for hereunder, except to the extent the judgment or award expressly states that it, or
any portion thereof, is based on a claim as to which indemnification is not available.

 

    	A-1

    	 

    

 

The Company also agrees
that neither the Consultant nor any other Indemnified Person shall have any liability to the Company for, in connection with or
arising out of the engagement of the Consultant under the Agreement except for any such liability for Damages, including attorneys
fees, incurred by the Company that are finally determined in the manner specified by the Agreement (and not subject to further
review) to have resulted from the Consultant’s or other Indemnified Person’s bad faith, willful misconduct or gross
negligence.

 

In no event shall the Company or any Indemnified
Person be responsible for any special, indirect or consequential damages incurred by the other; provided that nothing in this sentence
shall be deemed to (i) relieve the Company of any obligation it may otherwise have hereunder to indemnify an Indemnified Person
for any such damages asserted by an unaffiliated third party or (ii) relieve the Consultant of any liability it may otherwise have
hereunder to the Company for any such damages which the Company becomes legally obligated to pay to an unaffiliated third party.

 

In the event that the
foregoing indemnity is unavailable (except by reason of the bad faith, willful misconduct or gross negligence of the Consultant
or an Indemnified Party), then the Consultant and the Company shall contribute to amounts paid or payable by the Indemnified Parties,
in respect of the Damages sustained or incurred by the Indemnified Parties, in such proportion as appropriately reflects the relative
benefits received by, and the relative fault of, the Consultant and the Company in connection with the matters as to which such
Damages relate and other equitable considerations; provided, however, that in no event shall the amount to be contributed by the
Consultant exceed the amount of the Consultant Fees actually received by the Consultant in cash from the Company under the terms
of the Agreement.

 

The Company will not,
without the Consultant’s prior written consent (which shall not be unreasonably withheld), consent to the entry of any judgment
in or otherwise seek to terminate any Action in respect of which indemnification may be sought hereunder (if any Indemnified Person
is a party, or reasonably anticipated to become a party, thereto) unless such settlement, compromise, consent or termination includes
an unconditional release of each Indemnified Person from all Damages arising out of such Action. No Indemnified Person seeking
indemnification, reimbursement or contribution hereunder will, without prior written consent the Company, which consent shall not
be unreasonably withheld, settle, compromise, consent to the entry of any judgment in or otherwise seek to terminate any Action
in respect of which indemnification may be sought hereunder.

 

    	A-2

    	 

    

 

Promptly after receipt
by an Indemnified Person of notice of its involvement in any Action, the Consultant shall, if a claim for indemnification in respect
thereof is to be made against the Company hereunder, notify the Company of such involvement; provided, however, that the failure
to so notify the Company shall not relieve the Company of any liability that it may have under the provisions of this Annex A except
to the extent that it has been prejudiced in any material respect by such failure, or from any liability which it may otherwise
have to the Indemnified Parties.

 

If an Indemnified Person
is entitled to indemnification under this Annex A with respect to any action or proceeding brought by a third party, the Company
shall be entitled to assume the defense of any such action or proceeding with counsel reasonably satisfactory to the Indemnified
Person. Upon assumption by the Company of the defense of any such action or proceeding, the Indemnified Person shall have the right
to participate in such action or proceeding and to retain its own counsel, but the Company shall not be liable for any legal expenses
of other counsel subsequently incurred by such Indemnified Person in connection with the defense thereof unless the Company shall
have failed to employ counsel reasonably satisfactory to the Indemnified Person in a timely manner.

 

    	A-3

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