Document:

Exhibit 4.2 

 

[FORM OF WARRANT]

 

NEITHER THE ISSUANCE AND SALE OF THE SECURITIES
REPRESENTED BY THIS CERTIFICATE NOR THE SECURITIES INTO WHICH THESE SECURITIES ARE EXERCISABLE HAVE BEEN REGISTERED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED, OR APPLICABLE STATE SECURITIES LAWS. THE SECURITIES MAY NOT BE OFFERED FOR SALE, SOLD, TRANSFERRED OR
ASSIGNED (I) IN THE ABSENCE OF (A) AN EFFECTIVE REGISTRATION STATEMENT FOR THE SECURITIES UNDER THE SECURITIES ACT OF 1933, AS
AMENDED, OR (B) AN OPINION OF COUNSEL SELECTED BY THE HOLDER, IN A FORM REASONABLY ACCEPTABLE TO THE COMPANY, THAT REGISTRATION
IS NOT REQUIRED UNDER SAID ACT OR (II) UNLESS SOLD PURSUANT TO RULE 144 OR RULE 144A UNDER SAID ACT. NOTWITHSTANDING THE FOREGOING,
THE SECURITIES MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT OR OTHER LOAN OR FINANCING ARRANGEMENT SECURED BY THE
SECURITIES.

 

enerpulse
technologies, inc.

 

Warrant
To Purchase Common Stock

 

Warrant No.:___________

Number of Shares of Common Stock:_______________

Date of Issuance: February [___], 2015 ("Issuance Date")

 

Enerpulse Technologies, Inc.,
a Nevada corporation (the "Company"), hereby certifies that, for good and valuable consideration, the receipt
and sufficiency of which are hereby acknowledged, BUYER, the registered holder hereof
or its permitted assigns (the "Holder"), is entitled, subject to the terms set forth below, to purchase from the
Company, at the Exercise Price (as defined below) then in effect, at any time or times on or after the Issuance Date, but not after
11:59 p.m., New York time, on the Expiration Date, (as defined below), ______________ (_____________)1
fully paid nonassessable shares of Common Stock, subject to adjustment as provided herein (the "Warrant Shares").
Except as otherwise defined herein, capitalized terms in this Warrant to Purchase Common Stock (including any Warrants to Purchase
Common Stock issued in exchange, transfer or replacement hereof, this "Warrant"), shall have the meanings set
forth in Section 17. This Warrant is one of the Warrants to purchase Common Stock (the "SPA Warrants") issued
pursuant to Section 1 of that certain Securities Purchase Agreement, dated as of February [__], 2015 (the "Subscription
Date"), by and among the Company and the investors (the "Buyers") referred to therein (the "Securities
Purchase Agreement"). Capitalized terms used herein and not otherwise defined shall have the definitions ascribed to such
terms in the Securities Purchase Agreement.

 

 

1 Insert 50% of the number of shares
of Common Stock issuable upon conversion of the SPA Securities purchased by the Holder pursuant to the Securities Purchase Agreement.

 

    	 

    	 

    

 

		1.	EXERCISE OF WARRANT.

 

(a) Mechanics of Exercise.
Subject to the terms and conditions hereof (including, without limitation, the limitations set forth in Section 1(f)), this Warrant
may be exercised by the Holder at any time or times on or after the Issuance Date, in whole or in part, by (i) delivery of
a written notice, in the form attached hereto as Exhibit A (the "Exercise Notice"), of the Holder's election
to exercise this Warrant and (ii) (A) payment to the Company of an amount equal to the applicable Exercise Price multiplied
by the number of Warrant Shares as to which this Warrant is being exercised (the "Aggregate Exercise Price") in
cash by wire transfer of immediately available funds or (B) if the provisions of Section 1(d) are applicable, by notifying the
Company that this Warrant is being exercised pursuant to a valid Cashless Exercise (as defined in Section 1(d)). The Holder shall
not be required to deliver the original Warrant in order to effect an exercise hereunder. Execution and delivery of the Exercise
Notice with respect to less than all of the Warrant Shares shall have the same effect as cancellation of the original Warrant and
issuance of a new Warrant evidencing the right to purchase the remaining number of Warrant Shares. On or before the second (2nd)
Trading Day following the date on which the Company has received the Exercise Notice, the Company shall transmit by facsimile an
acknowledgment of confirmation of receipt of the Exercise Notice to the Holder and the Company's transfer agent (the "Transfer
Agent"). On or before the third (3rd) Trading Day following the date on which the Company has received the Exercise Notice,
so long as the Holder delivers the Aggregate Exercise Price (or notice of a Cashless Exercise) on or prior to the second (2nd)
Trading Day following the date on which the Company has received the Exercise Notice (the "Share Delivery Date")
(provided that if the Aggregate Exercise Price has not been delivered by such date, the Share Delivery Date shall be one (1) Trading
Day after the Aggregate Exercise Price (or notice of a Cashless Exercise) is delivered), the Company shall (X) provided that the
Transfer Agent is participating in The Depository Trust Company ("DTC") Fast Automated Securities Transfer Program
and the Warrant Shares are subject to an effective registration statement in favor of the Holder or if exercised via Cashless Exercise,
at a time when Rule 144 would be available for immediate resale of the Warrant Shares by the Holder, credit such aggregate number
of Warrant Shares to which the Holder is entitled pursuant to such exercise to the Holder's or its designee's balance account with
DTC through its Deposit / Withdrawal At Custodian system, or (Y) if the Transfer Agent is not participating in the DTC Fast Automated
Securities Transfer Program or the Warrant Shares are not subject to an effective registration statement in favor of the Holder
or if exercised via Cashless Exercise, at a time when Rule 144 would not be available for immediate resale of the Warrant Shares
by the Holder, issue and dispatch by overnight courier to the address as specified in the Exercise Notice, a certificate, registered
in the Company's share register in the name of the Holder or its designee, for the number of Warrant Shares to which the Holder
is entitled pursuant to such exercise. The Company shall be responsible for all fees and expenses of the Transfer Agent and all
fees and expenses with respect to the issuance of Warrant Shares via DTC, if any. Upon delivery of the Exercise Notice, so long
as the Holder delivers the Aggregate Exercise Price (or notice of Cashless Exercise) on or prior to the second (2nd) Trading Day
following the date on which the Company has received the Exercise Notice, the Holder shall be deemed for all corporate purposes
to have become the holder of record of the Warrant Shares with respect to which this Warrant has been exercised, irrespective of
the date such Warrant Shares are credited to the Holder's DTC account or the date of delivery of the certificates evidencing such
Warrant Shares, as the case may be. If this Warrant is submitted in connection with any exercise pursuant to this Section 1(a)
and the number of Warrant Shares represented by this Warrant submitted for exercise is greater than the number of Warrant Shares
being acquired upon an exercise, then the Company shall as soon as practicable and in no event later than five (5) Trading Days
after any exercise and at its own expense, issue a new Warrant (in accordance with Section 7(d)) representing the right to purchase
the number of Warrant Shares issuable immediately prior to such exercise under this Warrant, less the number of Warrant Shares
with respect to which this Warrant is exercised. No fractional Warrant Shares are to be issued upon the exercise of this Warrant,
but rather the number of Warrant Shares to be issued shall be rounded up or down, as applicable, to the nearest whole number. The
Company shall pay any and all taxes which may be payable with respect to the issuance and delivery of Warrant Shares upon exercise
of this Warrant. The Company's obligations to issue and deliver Warrant Shares in accordance with the terms and subject to the
conditions hereof are absolute and unconditional, irrespective of any action or inaction by the Holder to enforce the same, any
waiver or consent with respect to any provision hereof, the recovery of any judgment against any Person or any action to enforce
the same, or any setoff, counterclaim, recoupment, limitation or termination.  

 

    	- 2 -

    	 

    

 

(b) Exercise Price.
For purposes of this Warrant, "Exercise Price" means $0.20, subject to adjustment as provided herein.

 

(c) Company's Failure
to Timely Deliver Securities. If the Company shall fail for any reason or for no reason to issue to the Holder on or prior
to the Share Delivery Date either (I) if the Transfer Agent is not participating in the DTC Fast Automated Securities Transfer
Program or the shares of Common Stock to which the Holder is entitled upon the Holder's exercise of any portion of this Warrant
are not eligible to be issued without a restrictive legend pursuant to Section 2(g) of the Securities Purchase Agreement, a certificate
for the number of shares of Common Stock to which the Holder is entitled and register such shares of Common Stock on the Company's
share register, or if the Transfer Agent is participating in the DTC Fast Automated Securities Transfer Program and the shares
of Common Stock to which the Holder is entitled upon the Holder's exercise of any portion of this Warrant are eligible to be issued
without a restrictive legend pursuant to Section 2(g) of the Securities Purchase Agreement, to credit the Holder's balance account
with DTC, for such number of shares of Common Stock to which the Holder is entitled upon the Holder's exercise of this Warrant,
or pursuant to the Company's obligation pursuant to clause (ii) below or (II) if the Registration Statement (as defined in the
Registration Rights Agreement) covering the resale of all of the Warrant Shares that are the subject of the Exercise Notice (the
"Unavailable Warrant Shares") is not available for the resale of such Unavailable Warrant Shares and the Company
fails to promptly, but in no event later than as required pursuant to the Registration Rights Agreement (x) so notify the Holder
and (y) deliver the Warrant Shares electronically without any restrictive legend by crediting such aggregate number of Warrant
Shares to which the Holder is entitled pursuant to such exercise to the Holder's or its designee's balance account with DTC through
its Deposit / Withdrawal At Custodian system, then, in addition to all other remedies available to the Holder, (X) the Holder,
upon written notice to the Company, may void its Exercise Notice with respect to, and retain or have returned, as the case may
be, any portion of this Warrant that has not been exercised pursuant to such Exercise Notice; provided that the voiding of an Exercise
Notice shall not affect the Company's obligations to make any payments which have accrued prior to the date of such notice pursuant
to this Section 1(c) or otherwise and (Y) if on or after such Trading Day the Holder purchases (in an open market transaction or
otherwise) shares of Common Stock to deliver in satisfaction of a sale by the Holder of shares of Common Stock issuable upon such
exercise that the Holder anticipated receiving from the Company (a "Buy-In"), then the Company shall, within three
(3) Trading Days after the Holder's request and in the Holder's discretion, either (i) pay cash to the Holder in an amount equal
to the Holder's total purchase price (including brokerage commissions and other out-of-pocket expenses, if any) for the shares
of Common Stock so purchased (the "Buy-In Price"), at which point the Company's obligation to deliver such certificate
(and to issue such shares of Common Stock) or credit such Holder's balance account with DTC for such shares of Common Stock shall
terminate, or (ii) promptly honor its obligation to deliver to the Holder a certificate or certificates representing such shares
of Common Stock or credit such Holder's balance account with DTC, as applicable, and pay cash to the Holder in an amount equal
to the excess (if any) of the Buy-In Price over the product of (A) such number of shares of Common Stock, times (B) the Closing
Bid Price of the Common Stock on the date of exercise. Nothing shall limit the Holder's right to pursue any other remedies available
to it hereunder, at law or in equity, including, without limitation, a decree of specific performance and/or injunctive relief
with respect to the Company's failure to timely deliver certificates representing shares of Common Stock (or to electronically
deliver such shares of Common Stock) upon the exercise of this Warrant as required pursuant to the terms hereof.

 

    	- 3 -

    	 

    

 

(d) Cashless Exercise.
 Notwithstanding anything contained herein to the contrary, at any time after the six (6) month anniversary of the Issuance
Date, the Holder may, in its sole discretion, exercise this Warrant in whole or in part and, in lieu of making the cash payment
otherwise contemplated to be made to the Company upon such exercise in payment of the Aggregate Exercise Price, elect instead to
receive upon such exercise the "Net Number" of shares of Common Stock determined according to the following formula (a
"Cashless Exercise"):

 

Net Number = (A
x B) - (A x C)

B

 

For purposes of
the foregoing formula:

 

A= the total
number of shares with respect to which this Warrant is then being exercised.

 

B= the arithmetic
average of the Closing Sale Prices of the Common Stock for the five (5) consecutive Trading Days ending on the date immediately
preceding the date of the Exercise Notice.

 

C= the Exercise
Price then in effect for the applicable Warrant Shares at the time of such exercise.

 

For purposes of Rule 144(d)
promulgated under the 1933 Act, as in effect on the date hereof, it is intended that the Warrant Shares issued in a Cashless Exercise
shall be deemed to have been acquired by the Holder, and the holding period for the Warrant Shares shall be deemed to have commenced,
on the date this Warrant was originally issued pursuant to the Securities Purchase Agreement.

 

    	- 4 -

    	 

    

 

(e) Disputes. In
the case of a dispute as to the determination of the Exercise Price or the arithmetic calculation of the Warrant Shares, the Company
shall promptly issue to the Holder the number of Warrant Shares that are not disputed and resolve such dispute in accordance with
Section 12.

 

(f) Beneficial Ownership
Limitation on Exercises. Notwithstanding anything to the contrary contained herein, the Company shall not effect the exercise
of any portion of this Warrant, and the Holder shall not have the right to exercise any portion of this Warrant, pursuant to the
terms and conditions of this Warrant and any such exercise shall be null and void and treated as if never made, to the extent that
after giving effect to such exercise, the Holder together with the other Attribution Parties collectively would beneficially own
in excess of [9.99] [4.99]% (the "Maximum Percentage") of the number of shares of Common Stock outstanding immediately
after giving effect to such exercise. For purposes of the foregoing sentence, the aggregate number of shares of Common Stock beneficially
owned by the Holder and the other Attribution Parties shall include the number of shares of Common Stock held by the Holder and
all other Attribution Parties plus the number of shares of Common Stock issuable upon exercise of this Warrant with respect to
which the determination of such sentence is being made, but shall exclude the number of shares of Common Stock which would be issuable
upon (A) exercise of the remaining, unexercised portion of this Warrant beneficially owned by the Holder or any of the other Attribution
Parties and (B) exercise or conversion of the unexercised or unconverted portion of any other securities of the Company (including,
without limitation, any convertible notes or convertible preferred stock or warrants, including the other SPA Warrants) beneficially
owned by the Holder or any other Attribution Party subject to a limitation on conversion or exercise analogous to the limitation
contained in this Section 1(f). For purposes of this Section 1(f), beneficial ownership shall be calculated in accordance with
Section 13(d) of the Securities Exchange Act of 1934, as amended (the "1934 Act"). For purposes of this Warrant,
in determining the number of outstanding shares of Common Stock the Holder may acquire upon the exercise of this Warrant without
exceeding the Maximum Percentage, the Holder may rely on the number of outstanding shares of Common Stock as reflected in (x) the
Company's most recent Annual Report on Form 10-K, Quarterly Report on Form 10-Q, Current Report on Form 8-K or other public filing
with the Securities and Exchange Commission (the "SEC"), as the case may be, (y) a more recent public announcement
by the Company or (3) any other written notice by the Company or the Transfer Agent setting forth the number of shares of Common
Stock outstanding (the "Reported Outstanding Share Number"). If the Company receives an Exercise Notice from the
Holder at a time when the actual number of outstanding shares of Common Stock is less than the Reported Outstanding Share Number,
the Company shall (i) notify the Holder in writing of the number of shares of Common Stock then outstanding and, to the extent
that such Exercise Notice would otherwise cause the Holder's beneficial ownership, as determined pursuant to this Section 1(f),
to exceed the Maximum Percentage, the Holder must notify the Company of a reduced number of Warrant Shares to be purchased pursuant
to such Exercise Notice (the number of shares by which such purchase is reduced, the "Reduction Shares") and (ii)
as soon as reasonably practicable, the Company shall return to the Holder any exercise price paid by the Holder for the Reduction
Shares. For any reason at any time, upon the written or oral request of the Holder, the Company shall within two (2) Business Days
confirm orally and in writing or by electronic mail to the Holder the number of shares of Common Stock then outstanding. In any
case, the number of outstanding shares of Common Stock shall be determined after giving effect to the conversion or exercise of
securities of the Company, including this Warrant, by the Holder and any other Attribution Party since the date as of which the
Reported Outstanding Share Number was reported. In the event that the issuance of shares of Common Stock to the Holder upon exercise
of this Warrant results in the Holder and the other Attribution Parties being deemed to beneficially own, in the aggregate, more
than the Maximum Percentage of the number of outstanding shares of Common Stock (as determined under Section 13(d) of the 1934
Act), the number of shares so issued by which the Holder's and the other Attribution Parties' aggregate beneficial ownership exceeds
the Maximum Percentage (the "Excess Shares") shall be deemed null and void and shall be cancelled ab initio, and
the Holder shall not have the power to vote or to transfer the Excess Shares. As soon as reasonably practicable after the issuance
of the Excess Shares has been deemed null and void, the Company shall return to the Holder the exercise price paid by the Holder
for the Excess Shares. Upon delivery of a written notice to the Company, the Holder may from time to time increase (with such increase
not effective until the sixty-first (61st) day after delivery of such notice) or decrease the Maximum Percentage to
any other percentage not in excess of 9.99% as specified in such notice; provided that (i) any such increase in the Maximum Percentage
will not be effective until the sixty-first (61st) day after such notice is delivered to the Company and (ii) any such
increase or decrease will apply only to the Holder and the other Attribution Parties and not to any other holder of SPA Warrants
that is not an Attribution Party of the Holder. For purposes of clarity, the shares of Common Stock issuable pursuant to the terms
of this Warrant in excess of the Maximum Percentage shall not be deemed to be beneficially owned by the Holder for any purpose
including for purposes of Section 13(d) or Rule 16a-1(a)(1) of the 1934 Act. No prior inability to exercise this Warrant pursuant
to this paragraph shall have any effect on the applicability of the provisions of this paragraph with respect to any subsequent
determination of exercisability. The provisions of this paragraph shall be construed and implemented in a manner otherwise than
in strict conformity with the terms of this Section 1(f) to the extent necessary to correct this paragraph or any portion of this
paragraph which may be defective or inconsistent with the intended beneficial ownership limitation contained in this Section 1(f)
or to make changes or supplements necessary or desirable to properly give effect to such limitation. The limitation contained in
this paragraph may not be waived and shall apply to a successor holder of this Warrant.

 

    	- 5 -

    	 

    

 

(g) Insufficient Authorized
Shares. If at any time while this Warrant remains outstanding the Company does not have a sufficient number of authorized and
unreserved shares of Common Stock to satisfy its obligation to reserve for issuance upon exercise of this Warrant at least a number
of shares of Common Stock equal to 125% of the number of shares of Common Stock as shall from time to time be necessary to effect
the exercise of all of this Warrant then outstanding (the "Required Reserve Amount" and the failure to have such
sufficient number of authorized and unreserved shares of Common Stock, an "Authorized Share Failure"), then the
Company shall immediately take all action necessary to increase the Company's authorized shares of Common Stock to an amount sufficient
to allow the Company to reserve the Required Reserve Amount for this Warrant then outstanding. Without limiting the generality
of the foregoing sentence, as soon as practicable after the date of the occurrence of an Authorized Share Failure, but in no event
later than sixty (60) days after the occurrence of such Authorized Share Failure, the Company shall hold a meeting of its shareholders
for the approval of an increase in the number of authorized shares of Common Stock. In connection with such meeting, the Company
shall provide each shareholder with a proxy statement and shall use its best efforts to solicit its shareholders' approval of such
increase in authorized shares of Common Stock and to cause its board of directors to recommend to the shareholders that they approve
such proposal. Notwithstanding the foregoing, if any such time of an Authorized Share Failure, the Company is able to obtain the
written consent of a majority of the shares of its issued and outstanding Common Stock to approve the increase in the number of
authorized shares of Common Stock, the Company may satisfy this obligation by obtaining such consent and submitting for filing
with the SEC an Information Statement on Schedule 14C. In the event that upon any exercise of this Warrant, the Company does not
have sufficient authorized shares to deliver in satisfaction of such exercise, then the Holder may elect to void such attempted
exercise.

 

    	- 6 -

    	 

    

 

2.          ADJUSTMENT
OF EXERCISE PRICE AND NUMBER OF WARRANT SHARES. The Exercise Price and the number of Warrant Shares shall be adjusted from
time to time as follows:

 

(a)          Adjustment
Upon Issuance of Shares of Common Stock. If and whenever on or after the Subscription Date, the Company issues or sells, or
in accordance with this Section 2 is deemed to have issued or sold, any shares of Common Stock (including the issuance or sale
of shares of Common Stock owned or held by or for the account of the Company, but excluding shares of Common Stock deemed to have
been issued or sold by the Company in connection with any Excluded Securities for a consideration per share (the "New Issuance
Price") less than a price (the "Applicable Price") equal to the Exercise Price in effect immediately
prior to such issue or sale or deemed issuance or sale (the foregoing a "Dilutive Issuance"), then immediately
after such Dilutive Issuance, the Exercise Price then in effect shall be reduced to an amount equal to the New Issuance Price.
Upon each such adjustment of the Exercise Price hereunder, the number of Warrant Shares issuable immediately prior to such Dilutive
Issuance shall be adjusted to the number of shares of Common Stock determined by multiplying the Exercise Price then in effect
immediately prior to such adjustment by the number of Warrant Shares acquirable upon exercise of this Warrant immediately prior
to such adjustment and dividing the product thereof by the Exercise Price resulting from such adjustment. For purposes of determining
the adjusted Exercise Price under this Section 2(a), the following shall be applicable:

 

(i)          Issuance
of Options. If the Company in any manner grants or sells any Options and the lowest price per share for which one share of
Common Stock is issuable upon the exercise of any such Option or upon conversion, exercise or exchange of any Convertible Securities
issuable upon exercise of any such Option is less than the Applicable Price, then such share of Common Stock shall be deemed to
be outstanding and to have been issued and sold by the Company at the time of the granting or sale of such Option for such price
per share. For purposes of this Section 2(a)(i), the "lowest price per share for which one share of Common Stock is issuable
upon the exercise of any such Options or upon conversion, exercise or exchange of any Convertible Securities issuable upon exercise
of any such Option" shall be equal to the sum of the lowest amounts of consideration (if any) received or receivable by the
Company with respect to any one share of Common Stock upon the granting or sale of the Option, upon exercise of the Option and
upon conversion, exercise or exchange of any Convertible Security issuable upon exercise of such Option less any consideration
paid or payable by the Company with respect to such one share of Common Stock upon the granting or sale of such Option, upon exercise
of such Option and upon conversion exercise or exchange of any Convertible Security issuable upon exercise of such Option. No further
adjustment of the Exercise Price or number of Warrant Shares shall be made upon the actual issuance of such shares of Common Stock
or of such Convertible Securities upon the exercise of such Options or upon the actual issuance of such shares of Common Stock
upon conversion, exercise or exchange of such Convertible Securities.

 

    	- 7 -

    	 

    

 

(ii)         Issuance
of Convertible Securities. If the Company in any manner issues or sells any Convertible Securities and the lowest price per
share for which one share of Common Stock is issuable upon the conversion, exercise or exchange thereof is less than the Applicable
Price, then such share of Common Stock shall be deemed to be outstanding and to have been issued and sold by the Company at the
time of the issuance or sale of such Convertible Securities for such price per share. For the purposes of this Section 2(a)(ii),
the "lowest price per share for which one share of Common Stock is issuable upon the conversion, exercise or exchange thereof"
shall be equal to the sum of the lowest amounts of consideration (if any) received or receivable by the Company with respect to
any one share of Common Stock upon the issuance or sale of the Convertible Security and upon conversion, exercise or exchange of
such Convertible Security less any consideration paid or payable by the Company with respect to such one share of Common Stock
upon the issuance or sale of such Convertible Security and upon conversion, exercise or exchange of such Convertible Security.
No further adjustment of the Exercise Price or number of Warrant Shares shall be made upon the actual issuance of such shares of
Common Stock upon conversion, exercise or exchange of such Convertible Securities, and if any such issue or sale of such Convertible
Securities is made upon exercise of any Options for which adjustment of this Warrant has been or is to be made pursuant to other
provisions of this Section 2(a), no further adjustment of the Exercise Price or number of Warrant Shares shall be made by reason
of such issue or sale.

 

(iii)        Change
in Option Price or Rate of Conversion. Except with respect to Excluded Securities, if the purchase price provided for in any
Options, the additional consideration, if any, payable upon the issue, conversion, exercise or exchange of any Convertible Securities,
or the rate at which any Convertible Securities are convertible into or exercisable or exchangeable for shares of Common Stock
increases or decreases at any time, the Exercise Price and the number of Warrant Shares in effect at the time of such increase
or decrease shall be adjusted to the Exercise Price and the number of Warrant Shares, which would have been in effect at such time
had such Options or Convertible Securities provided for such increased or decreased purchase price, additional consideration or
increased or decreased conversion rate, as the case may be, at the time initially granted, issued or sold. For purposes of this
Section 2(a)(iii), if the terms of any Option or Convertible Security that was outstanding as of the Subscription Date are increased
or decreased in the manner described in the immediately preceding sentence, then such Option or Convertible Security and the shares
of Common Stock deemed issuable upon exercise, conversion or exchange thereof shall be deemed to have been issued as of the date
of such increase or decrease. No adjustment pursuant to this Section 2(a) shall be made if such adjustment would result in an increase
of the Exercise Price then in effect or a decrease in the number of Warrant Shares.

 

    	- 8 -

    	 

    

 

(iv)        Calculation
of Consideration Received. In case any Option is issued in connection with the issue or sale of other securities of the Company,
together comprising one integrated transaction, (x) the Options will be deemed to have been issued for the Option Value of such
Options and (y) the other securities issued or sold in such integrated transaction shall be deemed to have been issued or sold
for the difference of (I) the aggregate consideration received by the Company less any consideration paid or payable by the Company
pursuant to the terms of such other securities of the Company, less (II) the Option Value. If any shares of Common Stock, Options
or Convertible Securities are issued or sold or deemed to have been issued or sold for cash, the consideration other than cash
received therefor will be deemed to be the net amount received by the Company therefor. If any shares of Common Stock, Options
or Convertible Securities are issued or sold for a consideration other than cash, the amount of such consideration received by
the Company will be the fair value of such consideration, except where such consideration consists of publicly traded securities,
in which case the amount of consideration received by the Company will be the Closing Sale Price of such publicly traded securities
on the date of receipt. If any shares of Common Stock, Options or Convertible Securities are issued to the owners of the non-surviving
entity in connection with any merger in which the Company is the surviving entity, the amount of consideration therefor will be
deemed to be the fair value of such portion of the net assets and business of the non-surviving entity as is attributable to such
shares of Common Stock, Options or Convertible Securities, as the case may be. The fair value of any consideration other than cash
or publicly traded securities will be determined jointly by the Company and the Required Holders. If such parties are unable to
reach agreement within ten (10) days after the occurrence of an event requiring valuation (the "Valuation Event"),
the fair value of such consideration will be determined within five (5) Business Days after the tenth (10th) day following
the Valuation Event by an independent, reputable appraiser jointly selected by the Company and the Required Holders. The determination
of such appraiser shall be final and binding upon all parties absent manifest error and the fees and expenses of such appraiser
shall be equally borne by the Company and such holders of SPA Warrants that dispute the Company's fair value valuation.

 

(v)         Record
Date. If the Company takes a record of the holders of shares of Common Stock for the purpose of entitling them (A) to
receive a dividend or other distribution payable in shares of Common Stock, Options or in Convertible Securities or (B) to
subscribe for or purchase shares of Common Stock, Options or Convertible Securities, then such record date will be deemed to be
the date of the issue or sale of the shares of Common Stock deemed to have been issued or sold upon the declaration of such dividend
or the making of such other distribution or the date of the granting of such right of subscription or purchase, as the case may
be.

 

(vi)        No
Readjustments. For the avoidance of doubt, in the event the Exercise Price has been adjusted pursuant to this Section 2(a)
and the Dilutive Issuance that triggered such adjustment does not occur, is not consummated, is unwound or is cancelled after the
facts for any reason whatsoever, in no event shall the Exercise Price be readjusted to the Exercise Price that would have been
in effect if such Dilutive Issuance had not occurred or been consummated.

 

    	- 9 -

    	 

    

 

(b) Voluntary Adjustment
By Company. The Company may at any time during the term of this Warrant, with the prior written consent of the Holder, reduce
the then current Exercise Price to any amount and for any period of time deemed appropriate by the Board of Directors of the Company.

 

(c) Adjustment Upon
Subdivision or Combination of Shares of Common Stock. If the Company at any time on or after the Subscription Date subdivides
(by any stock split, stock dividend, recapitalization or otherwise) one or more classes of its outstanding shares of Common Stock
into a greater number of shares, the Exercise Price in effect immediately prior to such subdivision will be proportionately reduced
and the number of Warrant Shares will be proportionately increased. If the Company at any time on or after the Subscription Date
combines (by combination, reverse stock split or otherwise) one or more classes of its outstanding shares of Common Stock into
a smaller number of shares, the Exercise Price in effect immediately prior to such combination will be proportionately increased
and the number of Warrant Shares will be proportionately decreased. Any adjustment under this Section 2(c) shall become effective
at the close of business on the date the subdivision or combination becomes effective.

 

(d) Other Events.
If any event occurs of the type contemplated by the provisions of this Section 2 but not expressly provided for by such provisions
(including, without limitation, the granting of stock appreciation rights, phantom stock rights or other rights with equity features),
then the Company's Board of Directors will make an appropriate adjustment in the Exercise Price and the number of Warrant Shares,
as mutually determined by the Company’s Board of Directors and the Required Holders, so as to protect the rights of the Holder;
provided that no such adjustment pursuant to this Section 2(d) will increase the Exercise Price or decrease the number of
Warrant Shares as otherwise determined pursuant to this Section 2.

 

3.          Intentionally
omitted.

 

4.          ASSUMPTION
FUNDAMENTAL TRANSACTION; CHANGE OF CONTROL.

 

    	- 10 -

    	 

    

 

(a)          Assumption
Fundamental Transactions.

 

(i)          The
Company shall not enter into or be party to an Assumption Fundamental Transaction unless the Successor Entity assumes in writing
all of the obligations of the Company under this Warrant and the other Transaction Documents in accordance with the provisions
of this Section 4(a). Upon the occurrence or consummation of any Assumption Fundamental Transaction the Company and the Successor
Entity or Successor Entities, jointly and severally, shall succeed to, and the Company shall cause any Successor Entity or Successor
Entities to jointly and severally succeed to, and be added to the term "Company" under this Warrant (so that from and
after the date of such Assumption Fundamental Transaction, each and every provision of this Warrant referring to the "Company"
shall refer instead to each of the Company and the Successor Entity or Successor Entities, jointly and severally), and the Company
and the Successor Entity or Successor Entities, jointly and severally, may exercise every right and power of the Company prior
thereto and shall assume all of the obligations of the Company prior thereto under this Warrant with the same effect as if the
Company and such Successor Entity or Successor Entities, jointly and severally, had been named as the Company in this Warrant,
and, solely at the request of the Holder, if the Successor Entity and/or Successor Entities is a publicly traded corporation whose
common stock is quoted on or listed for trading on an Eligible Market, shall deliver (in addition to and without limiting any right
under this Warrant) to the Holder in exchange for this Warrant a security of the Successor Entity and/or Successor Entities evidenced
by a written instrument substantially similar in form and substance to this Warrant and exercisable for a corresponding number
of shares of capital stock of the Successor Entity and/or Successor Entities (the "Successor Capital Stock") equivalent
to the shares of Common Stock acquirable and receivable upon exercise of this Warrant (without regard to any limitations on the
exercise of this Warrant) prior to such Assumption Fundamental Transaction (provided, however, to the extent that the Holder's
right to receive any such shares of publicly traded common stock (or their equivalent) of the Successor Entity would result in
the Holder and its other Attribution Parties exceeding the Maximum Percentage, if applicable, then the Holder shall not be entitled
to receive such shares to such extent (and shall not be entitled to beneficial ownership of such shares of publicly traded common
stock (or their equivalent) of the Successor Entity as a result of such consideration to such extent) and the portion of such shares
shall be held in abeyance for the Holder until such time or times, as its right thereto would not result in the Holder and its
other Attribution Parties exceeding the Maximum Percentage, at which time or times the Holder shall be delivered such shares to
the extent as if there had been no such limitation), and such security shall be satisfactory to the Holder, and with an identical
exercise price to the Exercise Price hereunder (such adjustments to the number of shares of capital stock and such exercise price
being for the purpose of protecting after the consummation or occurrence of such Assumption Fundamental Transaction the economic
value of this Warrant that was in effect immediately prior to the consummation or occurrence of such Assumption Fundamental Transaction,
as elected by the Holder solely at its option).

 

(ii)         Upon
occurrence or consummation of the Assumption Fundamental Transaction the Company and the Successor Entity or Successor Entities
shall deliver to the Holder confirmation that there shall be issued upon exercise of this Warrant at any time after the occurrence
or consummation of the Assumption Fundamental Transaction, as elected by the Holder solely at its option, shares of Common Stock,
Successor Capital Stock or, in lieu of the shares of Common Stock or Successor Capital Stock (or other securities, cash, assets
or other property purchasable upon the exercise of this Warrant prior to such Assumption Fundamental Transaction), such shares
of stock, securities, cash, assets or any other property whatsoever (including warrants or other purchase or subscription rights),
which for purposes of clarification may continue to be shares of Common Stock, if any, that the Holder would have been entitled
to receive upon the happening of such Assumption Fundamental Transaction or the record, eligibility or other determination date
for the event resulting in such Assumption Fundamental Transaction, had this Warrant been exercised immediately prior to such Assumption
Fundamental Transaction or the record, eligibility or other determination date for the event resulting in such Assumption Fundamental
Transaction (without regard to any limitations on the exercise of this Warrant), as adjusted in accordance with the provisions
of this Warrant.

 

    	- 11 -

    	 

    

 

(iii)        In
addition to and not in substitution for any other rights hereunder, prior to the occurrence or consummation of any Assumption Fundamental
Transaction pursuant to which holders of shares of Common Stock are entitled to receive securities, cash, assets or other property
with respect to or in exchange for shares of Common Stock (a "Corporate Event"), the Company shall make appropriate
provision to insure that, and any applicable Successor Entity or Successor Entities shall ensure that the Holder will thereafter
have the right to receive upon exercise of this Warrant at any time after the occurrence or consummation of the Corporate Event,
shares of Common Stock or Successor Capital Stock or, if so elected by the Holder, in lieu of the shares of Common Stock (or other
securities, cash, assets or other property) purchasable upon the exercise of this Warrant prior to such Corporate Event, such shares
of stock, securities, cash, assets or any other property whatsoever (including warrants or other purchase or subscription rights
and any shares of Common Stock) which the Holder would have been entitled to receive upon the occurrence or consummation of such
Corporate Event or the record, eligibility or other determination date for the event resulting in such Corporate Event, had this
Warrant been exercised immediately prior to such Corporate Event or the record, eligibility or other determination date for the
event resulting in such Corporate Event (without regard to any limitations on exercise of this Warrant). Provision made pursuant
to the preceding sentence shall be in a form and substance reasonably satisfactory to the Holder.

 

(iv)        The
provisions of this Section 4(a) shall apply similarly and equally to successive Assumption Fundamental Transactions and Corporate
Events.

 

(b) Change of Control.

 

(i)          Notwithstanding
the foregoing, in the event of a Change of Control, at the election of the Holder (the "Change of Control Election")
delivered before the ninetieth (90th) day after the occurrence or consummation of such Change of Control (the "Change
of Control Election Period"), the Company (or the Successor Entity, as applicable) shall either (A) purchase this Warrant
from the Holder by paying to the Holder, within five (5) Business Days after such request (or, if later, on the effective date
of the Change of Control), cash in an amount equal to the Black Scholes Value of the remaining unexercised portion of this Warrant
on the date of such Change of Control or (B) within three (3) Business Days of the delivery of this Warrant to the Company or the
Successor Entity, as applicable, exchange such Warrant for such shares of stock, securities, cash, assets or any other property
whatsoever (including warrants or other purchase or subscription rights and any shares of Common Stock) which the Holder would
have been entitled to receive upon the occurrence or consummation of such Change of Control or the record, eligibility or other
determination date for the event resulting in such Change of Control, had this Warrant been exercised immediately prior to such
Change of Control or the record, eligibility or other determination date for the event resulting in such Change of Control (without
regard to any limitations on exercise of this Warrant).

 

(ii)         Prior
to the occurrence or consummation of any Change of Control pursuant to which holders of shares of Common Stock are entitled to
receive securities, cash, assets or other property with respect to or in exchange for shares of Common Stock, the Company shall
make appropriate provision to ensure that, and any applicable Successor Entity or Successor Entities shall ensure that, unless
the Holder has already made its Change of Control Election pursuant to Section 4(b)(i), the Holder shall continue to have the right
to make such Change of Control Election for any remaining portion of the Change of Control Election Period following the consummation
of such Change of Control. Provision made pursuant to the preceding sentence shall be in a form and substance reasonably satisfactory
to the Holder.

 

    	- 12 -

    	 

    

 

5.          NONCIRCUMVENTION.
The Company hereby covenants and agrees that the Company will not, by amendment of its Articles of Incorporation or Bylaws, or
through any reorganization, transfer of assets, consolidation, merger, scheme of arrangement, dissolution, issue or sale of securities,
or any other voluntary action, avoid or seek to avoid the observance or performance of any of the terms of this Warrant, and will
at all times in good faith carry out all of the provisions of this Warrant and take all action as may be required to protect the
rights of the Holder. Without limiting the generality of the foregoing, the Company (i) shall not increase the par value of
any shares of Common Stock receivable upon the exercise of this Warrant above the Exercise Price then in effect, (ii) shall
take all such actions as may be necessary or appropriate in order that the Company may validly and legally issue fully paid and
nonassessable shares of Common Stock upon the exercise of this Warrant, and (iii) shall, so long as any of the SPA Warrants are
outstanding, take all action reasonably necessary to reserve and keep available out of its authorized and unissued shares of Common
Stock, solely for the purpose of effecting the exercise of the SPA Warrants, 125% of the number of shares of Common Stock as shall
from time to time be reasonably necessary to effect the exercise of the SPA Warrants then outstanding (without regard to any limitations
on exercise).

 

6.          WARRANT
HOLDER NOT DEEMED A SHAREHOLDER. Except as otherwise specifically provided herein, the Holder, solely in such Person's capacity
as a holder of this Warrant, shall not be entitled to vote or receive dividends or be deemed the holder of share capital of the
Company for any purpose, nor shall anything contained in this Warrant be construed to confer upon the Holder, solely in such Person's
capacity as the Holder of this Warrant, any of the rights of a shareholder of the Company or any right to vote, give or withhold
consent to any corporate action (whether any reorganization, issue of stock, reclassification of stock, consolidation, merger,
conveyance or otherwise), receive notice of meetings, receive dividends or subscription rights, or otherwise, prior to the issuance
to the Holder of the Warrant Shares which such Person is then entitled to receive upon the due exercise of this Warrant. In addition,
nothing contained in this Warrant shall be construed as imposing any liabilities on the Holder to purchase any securities (upon
exercise of this Warrant or otherwise) or as a shareholder of the Company, whether such liabilities are asserted by the Company
or by creditors of the Company. Notwithstanding this Section 6, the Company shall provide the Holder with copies of the same notices
and other information given to the shareholders of the Company (the "Shareholder Information") generally, contemporaneously
with the giving thereof to the shareholders; provided, however, that the Holder will be deemed to have received the Shareholder
Information if disclosure on the substance of such Shareholder Information is filed with the SEC through EDGAR on a Current Report
on Form 8-K, Schedule 14A, Schedule 14C or other publicly available filing prior to or contemporaneously with the delivery of such
Shareholder Information to the Company's shareholders.

 

    	- 13 -

    	 

    

 

7.          REISSUANCE
OF WARRANTS.

 

(a)          Transfer
of Warrant. If this Warrant is to be transferred, the Holder shall surrender this Warrant to the Company, whereupon the Company
will forthwith issue and deliver upon the order of the Holder a new Warrant (in accordance with Section 7(d)), registered as the
Holder may request, representing the right to purchase the number of Warrant Shares being transferred by the Holder and, if less
than the total number of Warrant Shares then underlying this Warrant is being transferred, a new Warrant (in accordance with Section
7(d)) to the Holder representing the right to purchase the number of Warrant Shares not being transferred.

 

(b)          Lost,
Stolen or Mutilated Warrant. Upon receipt by the Company of evidence reasonably satisfactory to the Company of the loss, theft,
destruction or mutilation of this Warrant, and, in the case of loss, theft or destruction, of any indemnification undertaking by
the Holder to the Company in customary form and, in the case of mutilation, upon surrender and cancellation of this Warrant, the
Company shall execute and deliver to the Holder a new Warrant (in accordance with Section 7(d)) representing the right to purchase
the Warrant Shares then underlying this Warrant.

 

(c)          Exchangeable
for Multiple Warrants. This Warrant is exchangeable, upon the surrender hereof by the Holder at the principal office of the
Company, for a new Warrant or Warrants (in accordance with Section 7(d)) representing in the aggregate the right to purchase the
number of Warrant Shares then underlying this Warrant, and each such new Warrant will represent the right to purchase such portion
of such Warrant Shares as is designated by the Holder at the time of such surrender; provided, however, that no SPA
Warrants for fractional Warrant Shares shall be given.

 

(d)          Issuance
of New Warrants. Whenever the Company is required to issue a new Warrant pursuant to the terms of this Warrant, such new Warrant
(i) shall be of like tenor with this Warrant, (ii) shall represent, as indicated on the face of such new Warrant, the right to
purchase the Warrant Shares then underlying this Warrant (or in the case of a new Warrant being issued pursuant to Section 7(a)
or Section 7(c), the Warrant Shares designated by the Holder which, when added to the number of shares of Common Stock underlying
the other new Warrants issued in connection with such issuance, does not exceed the number of Warrant Shares then underlying this
Warrant), (iii) shall have an issuance date, as indicated on the face of such new Warrant which is the same as the Issuance Date,
and (iv) shall have the same rights and conditions as this Warrant.

 

8.          NOTICES.
Whenever notice is required to be given under this Warrant, unless otherwise provided herein, such notice shall be given in accordance
with Section 9(f) of the Securities Purchase Agreement. The Company shall provide the Holder with prompt written notice of all
actions taken pursuant to this Warrant, including in reasonable detail a description of such action and the reason therefor. Without
limiting the generality of the foregoing, the Company will give written notice to the Holder (i) promptly upon any adjustment of
the Exercise Price, setting forth in reasonable detail, and certifying, the calculation of such adjustment and (ii) at least fifteen
(15) days prior to the date on which the Company closes its books or takes a record (A) with respect to any dividend or distribution
upon the shares of Common Stock, (B) with respect to any grants, issuances or sales of any Options, Convertible Securities or rights
to purchase stock, warrants, securities or other property to holders of shares of Common Stock or (C) for determining rights to
vote with respect to any Fundamental Transaction, dissolution or liquidation; provided in each case that such information
shall be made known to the public prior to or in conjunction with such notice being provided to the Holder. It is expressly understood
and agreed that the time of exercise specified by the Holder in each Exercise Notice shall be definitive and may not be disputed
or challenged by the Company.

 

    	- 14 -

    	 

    

 

9.          AMENDMENT
AND WAIVER. Except as otherwise provided herein, the provisions of this Warrant may be amended or waived and the Company may
take any action herein prohibited, or omit to perform any act herein required to be performed by it, only if the Company has obtained
the written consent of the Holder.

 

10.         GOVERNING
LAW; JURISDICTION; JURY TRIAL. This Warrant shall be governed by and construed and enforced in accordance with, and all questions
concerning the construction, validity, interpretation and performance of this Warrant shall be governed by, the internal laws of
the State of New York, without giving effect to any choice of law or conflict of law provision or rule (whether of the State of
New York or any other jurisdictions) that would cause the application of the laws of any jurisdictions other than the State of
New York. The Company hereby irrevocably submits to the exclusive jurisdiction of the state and federal courts sitting in The City
of New York, Borough of Manhattan, for the adjudication of any dispute hereunder or in connection herewith or with any transaction
contemplated hereby or discussed herein, and hereby irrevocably waives, and agrees not to assert in any suit, action or proceeding,
any claim that it is not personally subject to the jurisdiction of any such court, that such suit, action or proceeding is brought
in an inconvenient forum or that the venue of such suit, action or proceeding is improper. The Company and, by acceptance of this
Warrant, the Holder, each hereby irrevocably waives personal service of process and consents to process being served in any such
suit, action or proceeding by mailing a copy thereof to the Company at the address set forth in Section 9(f) of the Securities
Purchase Agreement and agrees that such service shall constitute good and sufficient service of process and notice thereof. Nothing
contained herein shall be deemed to limit in any way any right to serve process in any manner permitted by law. Nothing contained
herein shall be deemed or operate to preclude the Holder from bringing suit or taking other legal action against the Company in
any other jurisdiction to collect on the Company's obligations to the Holder, to realize on any collateral or any other security
for such obligations, or to enforce a judgment or other court ruling in favor of the Holder. THE COMPANY AND BY ACCEPTANCE OF
THIS WARRANT, THE HOLDER, EACH HEREBY IRREVOCABLY WAIVES ANY RIGHT IT MAY HAVE, AND AGREES NOT TO REQUEST, A JURY TRIAL FOR THE
ADJUDICATION OF ANY DISPUTE HEREUNDER OR IN CONNECTION WITH OR ARISING OUT OF THIS WARRANT OR ANY TRANSACTION CONTEMPLATED HEREBY.

 

11.         CONSTRUCTION;
HEADINGS. This Warrant shall be deemed to be jointly drafted by the Company and all the Buyers and shall not be construed against
any Person as the drafter hereof. The headings of this Warrant are for convenience of reference and shall not form part of, or
affect the interpretation of, this Warrant.

 

    	- 15 -

    	 

    

 

12.         DISPUTE
RESOLUTION. In the case of a dispute as to the determination of the Exercise Price or the arithmetic calculation of the Warrant
Shares, the Company shall submit the disputed determinations or arithmetic calculations via facsimile within two (2) Business Days
of receipt of the Exercise Notice giving rise to such dispute, as the case may be, to the Holder. If the Holder and the Company
are unable to agree upon such determination or calculation of the Exercise Price or the Warrant Shares within three (3) Business
Days of such disputed determination or arithmetic calculation being submitted to the Holder, then the Company shall, within two
(2) Business Days submit via facsimile (a) the disputed determination of the Exercise Price to an independent, reputable investment
bank selected by the Company and approved by the Holder or (b) the disputed arithmetic calculation of the Warrant Shares to the
Company's independent, outside accountant. The Company shall cause the investment bank or, at its expense, the accountant, as the
case may be, to perform the determinations or calculations and notify the Company and the Holder of the results no later than ten
(10) Business Days from the time it receives the disputed determinations or calculations. Such investment bank's or accountant's
determination or calculation, as the case may be, shall be binding upon all parties absent demonstrable error. The Company and
the Holder shall jointly bear the cost of any investment bank pursuant to this Section 12.

 

13.         REMEDIES,
OTHER OBLIGATIONS, BREACHES AND INJUNCTIVE RELIEF. The remedies provided in this Warrant shall be cumulative and in addition
to all other remedies available under this Warrant and the other Transaction Documents, at law or in equity (including a decree
of specific performance and/or other injunctive relief), and nothing herein shall limit the right of the Holder to pursue actual
damages for any failure by the Company to comply with the terms of this Warrant. The Company acknowledges that a breach by it of
its obligations hereunder will cause irreparable harm to the Holder and that the remedy at law for any such breach may be inadequate.
The Company therefore agrees that, in the event of any such breach or threatened breach, the holder of this Warrant shall be entitled,
in addition to all other available remedies, to an injunction restraining any breach, without the necessity of showing economic
loss and without any bond or other security being required.

 

14.         TRANSFER.         This
Warrant and the Warrant Shares may be offered for sale, sold, transferred, pledged or assigned without the consent of the Company,
except as may otherwise be required by Section 2(f) of the Securities Purchase Agreement.

 

15.         SEVERABILITY.         If
any provision of this Warrant is prohibited by law or otherwise determined to be invalid or unenforceable by a court of competent
jurisdiction, the provision that would otherwise be prohibited, invalid or unenforceable shall be deemed amended to apply to the
broadest extent that it would be valid and enforceable, and the invalidity or unenforceability of such provision shall not affect
the validity of the remaining provisions of this Warrant so long as this Warrant as so modified continues to express, without material
change, the original intentions of the parties as to the subject matter hereof and the prohibited nature, invalidity or unenforceability
of the provision(s) in question does not substantially impair the respective expectations or reciprocal obligations of the parties
or the practical realization of the benefits that would otherwise be conferred upon the parties. The parties will endeavor in good
faith negotiations to replace the prohibited, invalid or unenforceable provision(s) with a valid provision(s), the effect of which
comes as close as possible to that of the prohibited, invalid or unenforceable provision(s).

 

    	- 16 -

    	 

    

 

16.         DISCLOSURE.
Upon receipt or delivery by the Company of any notice in accordance with the terms of this Warrant, unless the Company has in good
faith determined that the matters relating to such notice do not constitute material, nonpublic information relating to the Company
or its Subsidiaries (as defined in the Securities Purchase Agreement), the Company shall within two (2) Business Days after any
such receipt or delivery publicly disclose such material, nonpublic information on a Current Report on Form 8-K or otherwise. In
the event that the Company believes that a notice contains material, nonpublic information relating to the Company or its Subsidiaries,
the Company so shall indicate to such Holder contemporaneously with delivery of such notice, and in the absence of any such indication,
the Holder shall be allowed to presume that all matters relating to such notice do not constitute material, nonpublic information
relating to the Company or its Subsidiaries.

 

17.         CERTAIN
DEFINITIONS. For purposes of this Warrant, the following terms shall have the following meanings:

 

(a)  "1933
Act" means the Securities Act of 1933, as amended.

 

(b)  "Affiliate"
means, with respect to any Person, any other Person that directly or indirectly controls, is controlled by, or is under common
control with, such Person, it being understood for purposes of this definition that "control" of a Person means the power
directly or indirectly either to vote 10% or more of the stock having ordinary voting power for the election of directors of such
Person or direct or cause the direction of the management and policies of such Person whether by contract or otherwise.

 

(c)  "Assumption
Fundamental Transaction" means any Fundamental Transaction that is not a Change of Control.

 

(d)  "Attribution
Parties" means, collectively, the following Persons and entities: (i) any investment vehicle, including, any funds, feeder
funds or managed accounts, currently, or from time to time after the Issuance Date, directly or indirectly managed or advised by
the Holder's investment manager or any of its Affiliates or principals, (ii) any direct or indirect Affiliates of the Holder or
any of the foregoing, (iii) any Person acting or who could be deemed to be acting as a Group together with the Holder or any of
the foregoing and (iv) any other Persons whose beneficial ownership of the Company's Common Stock would or could be aggregated
with the Holder's and the other Attribution Parties for purposes of Section 13(d) of the 1934 Act. For clarity, the purpose of
the foregoing is to subject collectively the Holder and all other Attribution Parties to the Maximum Percentage.

 

(e)  "Approved
Stock Plan" means any employee benefit plan which has been approved by the Board of Directors of the Company, pursuant
to which the Company's securities may be issued to any employee, consultant, officer or director for services provided to the Company.

 

    	- 17 -

    	 

    

 

(f)  "Black
Scholes Value" means the value of this Warrant based on the Black-Scholes Option Pricing Model obtained from the "OV"
function on Bloomberg determined as of the day immediately following the public announcement of the applicable Fundamental Transaction,
or, if the Fundamental Transaction is not publicly announced, the date the Fundamental Transaction is consummated, for pricing
purposes and reflecting (i) a risk-free interest rate corresponding to the U.S. Treasury rate for a period equal to the remaining
term of this Warrant as of such date of request, (ii) an expected volatility equal to the greater of 100% and the 100 day volatility
obtained from the HVT function on Bloomberg as of the day immediately following the public announcement of the applicable Fundamental
Transaction, or, if the Fundamental Transaction is not publicly announced, the date the Fundamental Transaction is consummated,
(iii) the underlying price per share used in such calculation shall be the sum of the price per share being offered in cash, if
any, plus the value of any non-cash consideration, if any, being offered in the Fundamental Transaction, (iv) a zero cost of borrow
and (v) a 360 day annualization factor.

 

(g)  "Bloomberg"
means Bloomberg Financial Markets.

 

(h)  "Business
Day" means any day other than Saturday, Sunday or other day on which commercial banks in The City of New York are authorized
or required by law to remain closed.

 

(i)  "Change
of Control" means any Fundamental Transaction other than (i) any merger of the Company or any of its direct or indirect
wholly-owned Subsidiaries with or into any of the foregoing Persons, or any reorganization, recapitalization or reclassification
of the Common Stock, in which holders of the Company's voting power immediately prior to such merger, reorganization, recapitalization
or reclassification continue after such merger, reorganization, recapitalization or reclassification to hold publicly traded securities
and, directly or indirectly, the voting power of the surviving entity or entities necessary to elect a majority of the members
of the board of directors (or their equivalent if other than a corporation) of such entity or entities or (ii) pursuant to a migratory
merger effected solely for the purpose of changing the jurisdiction of incorporation of the Company.

 

(j)  "Closing
Bid Price" and "Closing Sale Price" means, for any security as of any date, the last closing bid price
and last closing trade price, respectively, for such security on the Principal Market, as reported by Bloomberg, or, if the Principal
Market begins to operate on an extended hours basis and does not designate the closing bid price or the closing trade price, as
the case may be, then the last bid price or the last trade price, respectively, of such security prior to 4:00:00 p.m., New York
time, as reported by Bloomberg, or, if the Principal Market is not the principal securities exchange or trading market for such
security, the last closing bid price or last trade price, respectively, of such security on the principal securities exchange or
trading market where such security is listed or traded as reported by Bloomberg, or if the foregoing do not apply, the last closing
bid price or last trade price, respectively, of such security in the over-the-counter market on the electronic bulletin board for
such security as reported by Bloomberg, or, if no closing bid price or last trade price, respectively, is reported for such security
by Bloomberg, the average of the bid prices, or the ask prices, respectively, of any market makers for such security as reported
in the OTC Link or "pink sheets" by OTC Markets Group Inc. (formerly Pink OTC Markets Inc.). If the Closing Bid Price
or the Closing Sale Price cannot be calculated for a security on a particular date on any of the foregoing bases, the Closing Bid
Price or the Closing Sale Price, as the case may be, of such security on such date shall be the fair market value as mutually determined
by the Company and the Holder. If the Company and the Holder are unable to agree upon the fair market value of such security, then
such dispute shall be resolved pursuant to Section 12. All such determinations to be appropriately adjusted for any stock dividend,
stock split, stock combination, reclassification or other similar transaction during the applicable calculation period.

 

    	- 18 -

    	 

    

 

(k)  "Common
Stock" means (i) the Company's shares of Common Stock, par value $0.001 per share, and (ii) any share capital
into which such Common Stock shall have been changed or any share capital resulting from a reclassification of such Common Stock.

 

(l)  "Convertible
Securities" means any stock or securities (other than Options) directly or indirectly convertible into or exercisable
or exchangeable for shares of Common Stock.

 

(m)  "Eligible
Market" means the Principal Market, the NYSE MKT LLC, The NASDAQ Global Market, The NASDAQ Global Select Market, The NASDAQ
Capital Market, The New York Stock Exchange, Inc or the OTC QB.

 

(n)  "Excluded
Securities" means any Common Stock issued or issuable: (i) in connection with any Approved Stock Plan; provided,
however, that no more than an aggregate of 250,000 (as adjusted for any stock dividend, stock split, stock combination,
reclassification or similar transaction after the Subscription Date) shares of Common Stock are issued or issuable to consultants
hereunder as Excluded Securities, (ii) pursuant to the terms of the SPA Securities (including, without limitation, pursuant to
a Mandatory Conversion (as defined in the SPA Securities) and as Interest Shares (as defined in the SPA Securities)), (iii) upon
exercise of any Options or Convertible Securities which are outstanding on the day immediately preceding the Subscription Date;
provided, that the terms of such Options or Convertible Securities are not amended, modified or changed on or after the
Subscription Date ((other than a change to the conversion price, exchange price or exercise price of such Options or Convertible
Securities arising from weighted-average or full-ratchet anti-dilution adjustment provisions as such provisions are set forth on
the Subscription Date in such Options or Convertible Securities) and (iv) pursuant to acquisitions or strategic transactions approved
by a majority of the disinterested directors of the Company, provided that any such issuance shall only be to a Person (or to the
equity holders of a Person) which is, itself or through its subsidiaries, an operating company or an owner of an asset in a business
synergistic with the business of the Company and shall provide to the Company additional benefits in addition to the investment
of funds, but shall not include a transaction in which the Company is issuing securities for the purpose of raising capital or
to an entity whose primary business is investing in securities.

 

(o)  "Expiration
Date" means the date sixty (60) months after the Issuance Date or, if such date falls on a day other than a Business Day
or on which trading does not take place on the Principal Market (a "Holiday"), the next day that is not a Holiday.

 

    	- 19 -

    	 

    

 

(p)  "Fundamental
Transaction" means (A) that the Company shall, directly or indirectly, including through Subsidiaries, Affiliates or otherwise,
in one or more related transactions, (i) consolidate or merge with or into (whether or not the Company is the surviving corporation)
another Subject Entity, or (ii) sell, assign, transfer, convey or otherwise dispose of all or substantially all of the properties
or assets of the Company or any of its "significant subsidiaries" (as defined in Rule 1-02 of Regulation S-X) to one
or more Subject Entities, or (iii) make, or allow one or more Subject Entities to make, or allow the Company to be subject to or
have its Common Stock be subject to or party to one or more Subject Entities making, a purchase, tender or exchange offer that
is accepted by the holders of at least either (x) 50% of the outstanding shares of Common Stock, (y) 50% of the outstanding shares
of Common Stock calculated as if any shares of Common Stock held by all Subject Entities making or party to, or Affiliated with
any Subject Entities making or party to, such purchase, tender or exchange offer were not outstanding; or (z) such number of shares
of Common Stock such that all Subject Entities making or party to, or Affiliated with any Subject Entity making or party to, such
purchase, tender or exchange offer, become collectively the beneficial owners (as defined in Rule 13d-3 under the 1934 Act) of
at least 50% of the outstanding shares of Common Stock, or (iv) consummate a stock purchase agreement or other business combination
(including, without limitation, a reorganization, recapitalization, spin-off or scheme of arrangement) with one or more Subject
Entities whereby all such Subject Entities, individually or in the aggregate, acquire, either (x) at least 50% of the outstanding
shares of Common Stock, (y) at least 50% of the outstanding shares of Common Stock calculated as if any shares of Common Stock
held by all the Subject Entities making or party to, or Affiliated with any Subject Entity making or party to, such stock purchase
agreement or other business combination were not outstanding; or (z) such number of shares of Common Stock such that the Subject
Entities become collectively the beneficial owners (as defined in Rule 13d-3 under the 1934 Act) of at least 50% of the outstanding
shares of Common Stock, or (v) reorganize, recapitalize or reclassify its Common Stock, (B) that the Company shall, directly or
indirectly, including through subsidiaries, Affiliates or otherwise, in one or more related transactions, allow any Subject Entity
individually or the Subject Entities in the aggregate to be or become the "beneficial owner" (as defined in Rule 13d-3
under the 1934 Act), directly or indirectly, whether through acquisition, purchase, assignment, conveyance, tender, tender offer,
exchange, reduction in outstanding shares of Common Stock, merger, consolidation, business combination, reorganization, recapitalization,
spin-off, scheme of arrangement, reorganization, recapitalization or reclassification or otherwise in any manner whatsoever, of
either (x) at least 50% of the aggregate ordinary voting power represented by issued and outstanding Common Stock, (y) at least
50% of the aggregate ordinary voting power represented by issued and outstanding Common Stock not held by all such Subject Entities
as of the date of this Warrant calculated as if any shares of Common Stock held by all such Subject Entities were not outstanding,
or (z) a percentage of the aggregate ordinary voting power represented by issued and outstanding shares of Common Stock or other
equity securities of the Company sufficient to allow such Subject Entities to effect a statutory short form merger or other transaction
requiring other shareholders of the Company to surrender their shares of Common Stock without approval of the shareholders of the
Company or (C) directly or indirectly, including through subsidiaries, Affiliates or otherwise, in one or more related transactions,
the issuance of or the entering into any other instrument or transaction structured in a manner to circumvent, or that circumvents,
the intent of this definition in which case this definition shall be construed and implemented in a manner otherwise than in strict
conformity with the terms of this definition to the extent necessary to correct this definition or any portion of this definition
which may be defective or inconsistent with the intended treatment of such instrument or transaction.

 

(q)  "Group" means a "group"
as that term is used in Section 13(d) of the 1934 Act and as defined in Rule 13d-5 thereunder.

 

    	- 20 -

    	 

    

 

(r)  "Option
Value" means the value of an Option based on the Black and Scholes Option Pricing model obtained from the "OV"
function on Bloomberg determined as of (A) the Trading Day prior to the public announcement of the issuance of the applicable Option,
if the issuance of such Option is publicly announced or (B) the Trading Day immediately following the issuance of the applicable
Option if the issuance of such Option is not publicly announced, for pricing purposes and reflecting (i) a risk-free interest rate
corresponding to the U.S. Treasury rate for a period equal to the remaining term of the applicable Option as of the applicable
date of determination, (ii) an expected volatility equal to the 100 day volatility (not to exceed 100% volatility) obtained from
the HVT function on Bloomberg as of (A) the Trading Day immediately following the public announcement of the applicable Option
if the issuance of such Option is publicly announced or (B) the Trading Day immediately following the issuance of the applicable
Option if the issuance of such Option is not publicly announced, (iii) the underlying price per share used in such calculation
shall be the highest Weighted Average Price of the Common Stock during the period beginning on the Trading Day prior to the execution
of definitive documentation relating to the issuance of the applicable Option and ending on (A) the Trading Day immediately following
the public announcement of such issuance, if the issuance of such Option is publicly announced or (B) the Trading Day immediately
following the issuance of the applicable Option if the issuance of such Option is not publicly announced, (iv) a zero cost of borrow
and (v) a 360 day annualization factor.

 

(s)  "Options"
means any rights, warrants or options to subscribe for or purchase shares of Common Stock or Convertible Securities.

 

(t)  "Parent
Entity" of a Person means an entity that, directly or indirectly, controls the applicable Person, including such entity
whose common shares or common stock or equivalent equity security is quoted or listed on an Eligible Market (or, if so elected
by the Required Holders, any other market, exchange or quotation system), or, if there is more than one such Person or such entity,
the Person or such entity designated by the Required Holders or in the absence of such designation, such Person or entity with
the largest public market capitalization as of the date of consummation of the Fundamental Transaction.

 

(u)  "Person"
means an individual, a limited liability company, a partnership, a joint venture, a corporation, a trust, an unincorporated organization,
any other entity and a government or any department or agency thereof.

 

(v)  "Principal
Market" means the OTC QX.

 

(w)  "Registration
Rights Agreement" means that certain Registration Rights Agreement dated as of the Subscription Date by and among the
Company and the Buyers.

 

(x)  "Required
Holders" means the holders of the SPA Warrants representing at least a majority of the shares of Common Stock underlying
the SPA Warrants then outstanding.

 

(y)  "SPA
Securities" means the Notes issued pursuant to the Securities Purchase Agreement.

 

    	- 21 -

    	 

    

 

(z)  "Subject
Entity" means any Person, Persons or Group or any Affiliate or associate of any such Person, Persons or Group.

 

(aa)         "Successor
Entity" means one or more Person or Persons (or, if so elected by the Holder, the Company or Parent Entity) formed by,
resulting from or surviving any Fundamental Transaction or one or more Person or Persons (or, if so elected by the Holder, the
Company or the Parent Entity) with which such Fundamental Transaction shall have been entered into.

 

(bb)         "Trading
Day" means any day on which the Common Stock is traded on the Principal Market, or, if the Principal Market is not the
principal trading market for the Common Stock, then on the principal securities exchange or securities market on which the Common
Stock is then traded; provided that "Trading Day" shall not include any day on which the Common Stock is scheduled
to trade on such exchange or market for less than 4.5 hours or any day that the Common Stock is suspended from trading during the
final hour of trading on such exchange or market (or if such exchange or market does not designate in advance the closing time
of trading on such exchange or market, then during the hour ending at 4:00:00 p.m., New York time).

 

(cc)         "Weighted
Average Price" means, for any security as of any date, the dollar volume-weighted average price for such security on the
Principal Market during the period beginning at 9:30:01 a.m., New York time (or such other time as the Principal Market publicly
announces is the official open of trading), and ending at 4:00:00 p.m., New York time (or such other time as the Principal Market
publicly announces is the official close of trading), as reported by Bloomberg through its "Volume at Price" function
or, if the foregoing does not apply, the dollar volume-weighted average price of such security in the over-the-counter market on
the electronic bulletin board for such security during the period beginning at 9:30:01 a.m., New York time (or such other time
as such market publicly announces is the official open of trading), and ending at 4:00:00 p.m., New York time (or such other time
as such market publicly announces is the official close of trading), as reported by Bloomberg, or, if no dollar volume-weighted
average price is reported for such security by Bloomberg for such hours, the average of the highest closing bid price and the lowest
closing ask price of any of the market makers for such security as reported in the OTC Link or "pink sheets" by OTC Markets
Group Inc. (formerly Pink OTC Markets Inc.). If the Weighted Average Price cannot be calculated for a security on a particular
date on any of the foregoing bases, the Weighted Average Price of such security on such date shall be the fair market value as
mutually determined by the Company and the Holder. If the Company and the Holder are unable to agree upon the fair market value
of such security, then such dispute shall be resolved pursuant to Section 12 with the term "Weighted Average Price" being
substituted for the term "Exercise Price." All such determinations shall be appropriately adjusted for any stock dividend,
stock split, stock combination, reclassification or other similar transaction during the applicable calculation period.

 

[Signature Page Follows]

 

    	- 22 -

    	 

    

 

IN WITNESS WHEREOF, the Company has caused
this Warrant to Purchase Common Stock to be duly executed as of the Issuance Date set out above.

 

	 	ENERPULSE TECHNOLOGIES, INC.

 

	 	By:	 	 
	 	Name:	 	 
	 	Title:	 	 

 

    	 

    	 

    

 

EXHIBIT A

 

EXERCISE NOTICE

 

TO BE EXECUTED BY THE REGISTERED HOLDER TO
EXERCISE THIS

WARRANT TO PURCHASE COMMON STOCK

 

Enerpulse
Technologies, Inc. 

 

The
undersigned holder hereby exercises the right to purchase _________________ of the shares of Common Stock ("Warrant Shares")
of Enerpulse Technologies, Inc., a Nevada corporation (the "Company"), evidenced
by the attached Warrant to Purchase Common Stock (the "Warrant"). Capitalized terms used herein and not otherwise
defined shall have the respective meanings set forth in the Warrant.

 

1.  Form of Exercise Price.
The Holder intends that payment of the Exercise Price shall be made as:

 

____________   a "Cash Exercise"
with respect to _________________ Warrant Shares; and/or

 

____________   a "Cashless Exercise"
with respect to _______________ Warrant Shares.

 

2.  Payment of Exercise
Price. In the event that the holder has elected a Cash Exercise with respect to some or all of the Warrant Shares to be issued
pursuant hereto, the holder shall pay the Aggregate Exercise Price in the sum of $___________________ to the Company in accordance
with the terms of the Warrant.

 

3.  Delivery of Warrant
Shares. The Company shall deliver to the holder __________ Warrant Shares in accordance with the terms of the Warrant.

 

4.
After giving effect to the exercise provided for in this Exercise Notice, the undersigned (together with its Attribution Parties)
will beneficially own no more than ______________ shares of Common Stock of the Company.

 

	Date: 	_______________ __, ______	 

 

	 	 
	Name of Registered Holder	 

 

	By:	 	 
	 	Name:	 
	 	Title:	 

 

    	 

    	 

    

 

ACKNOWLEDGMENT

 

The Company hereby acknowledges
this Exercise Notice and hereby directs Securities Transfer Corporation to issue the above indicated number of shares of Common
Stock in accordance with the Transfer Agent Instructions dated February __, 2015 from the Company and acknowledged and agreed to
by Securities Transfer Corporation.

 

ENERPULSE
TECHNOLOGIES, INC. 

 

	 	By:	 	 
	 	Name:	 	 
	 	Title:Exhibit 10.1

 

FORM OF SECURITIES PURCHASE AGREEMENT

 

SECURITIES PURCHASE
AGREEMENT (the "Agreement"), dated as of February [__], 2015, by and among Enerpulse Technologies, Inc., a
Nevada corporation, with headquarters located at 2451 Alamo Ave. NE, Albuquerque, New Mexico 87106 (the "Company"),
and the investors listed on the Schedule of Buyers attached hereto (individually, a "Buyer" and collectively,
the "Buyers").

 

WHEREAS:

 

A.The Company and
each Buyer is executing and delivering this Agreement in reliance upon the exemption from securities registration afforded by Section
4(a)(2) of the Securities Act of 1933, as amended (the "1933 Act"), and Rule 506(b) of Regulation D ("Regulation D")
as promulgated by the United States Securities and Exchange Commission (the "SEC") under the 1933 Act.

 

B.The Company has
authorized a new series of senior secured convertible notes of the Company, in substantially the form attached hereto as Exhibit
A (the "Notes"), which Notes shall be convertible into the Company's common stock, par value $0.001 per share
(the "Common Stock") (the shares of Common Stock issuable pursuant to the terms of the Notes, including,
without limitation, upon conversion as payment of interest or otherwise, collectively, the "Conversion Shares"),
in accordance with the terms of the Notes.

 

C.Each Buyer wishes
to purchase, and the Company wishes to sell, upon the terms and conditions stated in this Agreement, (i) that aggregate principal
amount of Notes set forth opposite such Buyer's name in column (3) on the Schedule of Buyers attached hereto (which aggregate principal
amount of Notes for all Buyers shall be $3,000,000), and (ii) Warrants, in substantially the form attached hereto as Exhibit
B (the " Warrants"), representing the right to acquire that number of shares of Common Stock set forth opposite
such Buyer's name in column (4) on the Schedule of Buyers (as exercised, collectively, the "Warrant Shares").

 

D.Contemporaneously
with the execution and delivery of this Agreement, the parties hereto are executing and delivering a Registration Rights Agreement,
substantially in the form attached hereto as Exhibit C (the "Registration Rights Agreement"), pursuant
to which the Company has agreed to provide certain registration rights with respect to the Registrable Securities (as defined in
the Registration Rights Agreement) under the 1933 Act and the rules and regulations promulgated thereunder, and applicable state
securities laws.

 

E.The Notes will
rank senior to all outstanding and future indebtedness of the Company (other than Permitted Senior Indebtedness (as defined in
the Notes) secured by Permitted Liens (as defined in the Notes)), and its Subsidiaries (as defined below), will be guaranteed by
all direct and indirect U.S. Subsidiaries (as defined in Section 3(a)) of the Company, currently formed or formed in the future,
as evidenced by a guaranty agreement, in the form attached hereto as Exhibit D (as amended or modified from time to time
in accordance with its terms, the "Guaranty Agreement"), and assuming the Collateral Agent (as defined below)
takes the proper and necessary steps to perfect the security interest immediately following the Closing Date, will be secured by
a first priority perfected security interest, subject to Permitted Liens which may have priority over such security interest to
the extent such Permitted Liens are expressly subordinated to such security interest or are subordinated as a matter of law to
such security interest, in all of the current and future assets of the Company and all direct and indirect U.S. Subsidiaries of
the Company, currently formed or formed in the future, and a pledge of 65% of the capital stock of any direct foreign subsidiary
of the Company, currently formed or formed in the future, as evidenced by a pledge and security agreement, substantially in the
form attached hereto as Exhibit E, (as amended or modified from time to time in accordance with its terms, the "Security
Agreement").

 

    	 

    	 

    

 

F.The Notes, the
Conversion Shares, the Warrants and the Warrant Shares collectively are referred to herein as the "Securities".

 

NOW, THEREFORE,
the Company and each Buyer hereby agree as follows:

 

1.PURCHASE AND SALE OF NOTES
AND WARRANTS.

 

(a)Purchase
of Notes and Warrants. Subject to the satisfaction (or waiver) of the conditions set forth in Sections 6 and 7 below, the Company
shall issue and sell to each Buyer, and each Buyer severally, but not jointly, agrees to purchase from the Company on the Closing
Date (as defined below), (x) a principal amount of Notes as is set forth opposite such Buyer's name in column (3) on the Schedule
of Buyers and (y) Warrants to acquire up to that number of Warrant Shares as is set forth opposite such Buyer's name in column
(4) on the Schedule of Buyers (the "Closing").

 

(b)Closing.
The date and time of the Closing (the "Closing Date") shall be 10:00 a.m., New York City time, on the date hereof
(or such other date and time as is mutually agreed to by the Company and each Buyer) after notification of satisfaction (or waiver)
of the conditions to the Closing set forth in Sections 6 and 7 below, at the offices of Schulte Roth & Zabel LLP, 919 Third
Avenue, New York, New York 10022.

 

(c)Purchase
Price. The aggregate purchase price for the Notes and the Warrants to be purchased by each Buyer at the Closing (the "Purchase
Price") shall be the amount set forth opposite each Buyer's name in column (5) of the Schedule of Buyers. Each Buyer shall
pay $1,000 for each $1,000 of principal amount of Notes and related Warrants to be purchased by such Buyer at the Closing. The
Buyers and the Company agree that the Notes and the Warrants constitute an "investment unit" for purposes of Section
1273(c)(2) of the Internal Revenue Code of 1986, as amended (the "Code"). The Buyers and the Company mutually
agree that the allocation of the issue price of such investment unit between the Notes and the Warrants in accordance with Section
1273(c)(2) of the Code and Treasury Regulation Section 1.1273-2(h) shall be an aggregate amount of $750,000 allocated to the Warrants
and the balance of the Purchase Price allocated to the Notes, and neither the Buyers nor the Company shall take any position inconsistent
with such allocation in any tax return or in any judicial or administrative proceeding in respect of taxes.

 

(d)Form
of Payment. On the Closing Date, (i) each Buyer shall pay its applicable purchase price to the Company for the Notes and the
Warrants to be issued and sold to such Buyer at the Closing by wire transfer of immediately available funds in accordance with
the Company's written wire instructions and (ii) the Company shall deliver to each Buyer the Notes (allocated in the principal
amounts as such Buyer shall request) which such Buyer is then purchasing hereunder along with the Warrants (allocated in the amounts
as such Buyer shall request) which such Buyer is purchasing hereunder, in each case duly executed on behalf of the Company and
registered in the name of such Buyer or its designee.

 

    	 

    	 

    

 

(e)Placement
Agent Fees. On the Closing Date, the Company shall pay to ROTH Capital Partners, LLC, as placement agent (the "Placement
Agent"), all fees (other than legal fees), reasonable and documented expenses, and reasonable and documented legal fees
and expenses (collectively, the "Placement Agent Fees") due to the Placement Agent as of such Closing Date, pursuant
to the terms of the engagement letter, dated as of November 3, 2014, between the Company and the Placement Agent (the "Engagement
Letter"), by wire transfer of immediately available funds in accordance with the Placement Agent's written wire instructions.

 

2.BUYER'S
REPRESENTATIONS AND WARRANTIES. Each Buyer, severally and not jointly, represents and warrants with respect to only itself
to the Company and the Placement Agent that:

 

(a)No
Public Sale or Distribution. Such Buyer is (i) acquiring the Notes and the Warrants and (ii) upon conversion of the Notes and
exercise of the Warrants (other than pursuant to a Cashless Exercise (as defined in the Warrants)) will acquire the Conversion
Shares issuable pursuant to the Notes and the Warrant Shares issuable upon exercise of the Warrants, for its own account and not
with a view towards, or for resale in connection with, the public sale or distribution thereof, except pursuant to sales registered
or exempted under the 1933 Act; provided, however, that by making the representations herein, such Buyer does not
agree to hold any of the Securities for any minimum or other specific term and reserves the right to dispose of the Securities
at any time in accordance with or pursuant to a registration statement or an exemption under the 1933 Act. Such Buyer is acquiring
the Securities hereunder in the ordinary course of its business. Such Buyer does not presently have any agreement or understanding,
directly or indirectly, with any Person (as defined below) to distribute any of the Securities. For purposes of this Agreement,
"Person" means an individual, a limited liability company, a partnership, a joint venture, a corporation, a trust,
an unincorporated organization and a government or any department or agency thereof.

 

(b)Accredited
Investor Status. Except as set forth in Schedule 2(b), such Buyer is an "accredited investor" as that term is
defined in Rule 501(a) of Regulation D.

 

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

 

(d)Information.
Such Buyer and its advisors, if any, have been furnished with all materials relating to the business, finances and operations of
the Company and materials relating to the offer and sale of the Securities that have been requested by such Buyer. Such Buyer and
its advisors, if any, have been afforded the opportunity to ask questions of the Company. Neither such inquiries nor any other
due diligence investigations conducted by such Buyer or its advisors, if any, or its representatives shall modify, amend or affect
such Buyer's right to rely on the Company's representations and warranties contained herein. Such Buyer understands that its investment
in the Securities involves a high degree of risk. Such Buyer has sought such accounting, legal and tax advice as it has considered
necessary to make an informed investment decision with respect to its acquisition of the Securities.

 

    	 

    	 

    

 

(e)No
Governmental Review. Such Buyer understands that no United States federal or state agency or any other government or governmental
agency has passed on or made any recommendation or endorsement of the Securities or the fairness or suitability of the investment
in the Securities nor have such authorities passed upon or endorsed the merits of the offering of the Securities. Such Buyer acknowledges
and agrees that neither the Placement Agent nor any affiliate of the Placement Agent has provided such Buyer with any information
or advice with respect to the Securities nor is such information or advice necessary or desired. Neither the Placement Agent nor
any affiliate has made or makes any representation as to the Company or the quality of the Securities and the Placement Agent and
any affiliate may have acquired non-public information with respect to the Company which such Buyer agrees need not be provided
to it. In connection with the issuance of the Securities to such Buyer, neither the Placement Agent nor any of its affiliates has
acted as a financial advisor or fiduciary to such Buyer.

 

(f)Transfer
or Resale. Such Buyer understands that except as provided in the Registration Rights Agreement: (i) the Securities have not
been and are not being registered under the 1933 Act or any state securities laws, and may not be offered for sale, sold, assigned
or transferred unless (A) subsequently registered thereunder, (B) such Buyer shall have delivered to the Company an opinion of
counsel, in a form reasonably acceptable to the Company, to the effect that such Securities to be sold, assigned or transferred
may be sold, assigned or transferred pursuant to an exemption from such registration, or (C) such Buyer provides the Company with
reasonable assurance that such Securities can be sold, assigned or transferred pursuant to Rule 144 or Rule 144A promulgated under
the 1933 Act, as amended, (or a successor rule thereto) (collectively, "Rule 144"); (ii) any sale of the Securities
made in reliance on Rule 144 may be made only in accordance with the terms of Rule 144 and further, if Rule 144 is not applicable,
any resale of the Securities under circumstances in which the seller (or the Person) through whom the sale is made) may be deemed
to be an underwriter (as that term is defined in the 1933 Act) may require compliance with some other exemption under the 1933
Act or the rules and regulations of the SEC thereunder; and (iii) neither the Company nor any other Person is under any obligation
to register the Securities under the 1933 Act or any state securities laws or to comply with the terms and conditions of any exemption
thereunder. Notwithstanding the foregoing, the Securities may be pledged in connection with a bona fide margin account or other
loan or financing arrangement secured by the Securities and such pledge of Securities shall not be deemed to be a transfer, sale
or assignment of the Securities hereunder, and no Buyer effecting a pledge of Securities shall be required to provide the Company
with any notice thereof or otherwise make any delivery to the Company pursuant to this Agreement or any other Transaction Document
(as defined in Section 3(b)), including, without limitation, this Section 2(f).

 

    	 

    	 

    

 

(g)Legends.
Such Buyer understands that the certificates or other instruments representing the Notes and the Warrants and, until such time
as the resale of the Conversion Shares and the Warrant Shares have been registered under the 1933 Act as contemplated by the Registration
Rights Agreement, the stock certificates representing the Conversion Shares and the Warrant Shares, except as set forth below,
shall bear any legend as required by the “blue sky” laws of any state and a restrictive legend in substantially the
following form (and a stop-transfer order may be placed against transfer of such stock certificates):

 

[NEITHER THE ISSUANCE AND SALE
OF THE SECURITIES REPRESENTED BY THIS CERTIFICATE NOR THE SECURITIES INTO WHICH THESE SECURITIES ARE [CONVERTIBLE]
[EXERCISABLE] HAVE BEEN][THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN] REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE STATE SECURITIES LAWS. THE SECURITIES MAY NOT BE OFFERED FOR SALE, SOLD,
TRANSFERRED OR ASSIGNED (I) IN THE ABSENCE OF (A) AN EFFECTIVE REGISTRATION STATEMENT FOR THE SECURITIES UNDER THE SECURITIES ACT
OF 1933, AS AMENDED, OR (B) AN OPINION OF COUNSEL, IN A GENERALLY ACCEPTABLE FORM, THAT REGISTRATION IS NOT REQUIRED UNDER SAID
ACT OR (II) UNLESS SOLD PURSUANT TO RULE 144 OR RULE 144A UNDER SAID ACT. NOTWITHSTANDING THE FOREGOING, THE SECURITIES MAY BE
PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT OR OTHER LOAN OR FINANCING ARRANGEMENT SECURED BY THE SECURITIES.

 

The legend set forth above shall be removed
and the Company shall issue a certificate without such legend to the holder of the Securities upon which it is stamped or issue
to such holder by electronic delivery at the applicable balance account at The Depository Trust Company ("DTC"),
if (i) such Securities are registered for resale under the 1933 Act, (ii) in connection with a sale, assignment or other transfer,
such holder provides the Company with an opinion of counsel, in a generally acceptable form, to the effect that such sale, assignment
or transfer of the Securities may be made without registration under the applicable requirements of the 1933 Act, (iii) the Securities
are then eligible to be sold, assigned or transferred pursuant to Rule 144 or Rule 144A and such holder provides the Company with
reasonable assurances in writing that such Securities shall be sold, assigned or transferred pursuant to Rule 144 or Rule 144A
prior to the expiration of the filing deadline for the first Quarterly Report on Form 10-Q or Annual Report on Form 10-K, as applicable,
immediately subsequent to the date of such legend removal request or if the Securities are to be sold after such filing deadline,
only after the Company has filed with the SEC such periodic filing, or (iv) the Securities have been sold, assigned or transferred
pursuant to Rule 144 or Rule 144A. The Company shall be responsible for the fees of its transfer agent and all DTC fees associated
with such issuance.

 

    	 

    	 

    

 

(h)Validity;
Enforcement. This Agreement and the Registration Rights Agreement have been duly and validly authorized, executed and delivered
on behalf of such Buyer and shall constitute the legal, valid and binding obligations of such Buyer enforceable against such Buyer
in accordance with their respective terms, except as such enforceability may be limited by general principles of equity or to applicable
bankruptcy, insolvency, reorganization, moratorium, liquidation and other similar laws relating to, or affecting generally, the
enforcement of applicable creditors' rights and remedies.

 

(i)No
Conflicts. The execution, delivery and performance by such Buyer of this Agreement and the Registration Rights Agreement and
the consummation by such Buyer of the transactions contemplated hereby and thereby will not (i) result in a violation of the organizational
documents of such Buyer or (ii) conflict with, or constitute a default (or an event which with notice or lapse of time or both
would become a default) under, or give to others any rights of termination, amendment, acceleration or cancellation of, any agreement,
indenture or instrument to which such Buyer is a party, or (iii) result in a violation of any law, rule, regulation, order, judgment
or decree (including federal and state securities laws) applicable to such Buyer, except in the case of clauses (ii) and (iii)
above, for such conflicts, defaults, rights or violations which would not, individually or in the aggregate, reasonably be expected
to have a material adverse effect on the ability of such Buyer to perform its obligations hereunder.

 

(j)Residency.
Such Buyer is a resident of that jurisdiction specified below its address on the Schedule of Buyers.

 

(k)Independent
Evaluation. Such Buyer confirms and agrees that (i) it has independently evaluated the merits of its decision to purchase the
Securities, (ii) it has not relied on the advice of, or any representations by the Placement Agent or any affiliate thereof or
any representative of the Placement Agent or its affiliates in making such decision, and (iii) neither the Placement Agent nor
any of its representatives has any responsibility with respect to the completeness or accuracy of any information or materials
furnished to such Buyer in connection with the transactions contemplated hereby.

 

(l)Acknowledgement
of Risk. Such Buyer acknowledges and understands that its investment in the Securities involves a significant degree of risk,
including, without limitation, (i) the Company remains an early stage business with limited operating history and requires
substantial funds in addition to the proceeds from the sale of the Securities; (ii) an investment in the Company is speculative,
and only purchasers who can afford the loss of their entire investment should consider investing in the Company and the Securities;
(iii) such Buyer may not be able to liquidate its investment; (iv) transferability of the Securities is limited; (v) in
the event of a disposition of the Securities, such Buyer could sustain the loss of its entire investment; and (vi) the Company
has not paid any dividends on its Common Stock since inception and does not anticipate the payment of dividends in the foreseeable
future.

 

(m)Acknowledgements
Regarding Placement Agent. Such Buyer acknowledges that the Placement Agent is acting as the exclusive placement agents on
a “best efforts” basis for the Securities being offered hereby and will be compensated by the Company for acting in
such capacity. Such Buyer represents that (i) such Buyer was contacted regarding the sale of the Securities by the Placement
Agent (or an authorized agent or representative thereof) with whom such Buyer had a substantial pre-existing relationship and who
entered into a confidentiality agreement or otherwise agreed, orally or in writing, to keep information with respect to the transactions
contemplated hereby confidential and (ii) to such Buyer's knowledge, no Securities were offered or sold to such Buyer by means
of any form of general solicitation or general advertising.

 

    	 

    	 

    

 

(n)Certain
Trading Activities. Such Buyer has not directly or indirectly, nor has any Person acting on behalf of or pursuant to any understanding
with such Buyer, engaged in any transactions in the securities of the Company (including, without limitation, any Short Sales (as
defined below) involving the Company’s securities) during the period commencing as of the time that such Buyer was first
contacted regarding the specific investment in the Company contemplated by this Agreement and ending immediately prior to the execution
of this Agreement by such Buyer (it being understood and agreed that for all purposes of this Agreement, and, without implication
that the contrary would otherwise be true, that neither transactions nor purchases nor sales shall include the location and/or
reservation of borrowable shares of Common Stock). Notwithstanding the foregoing, in the case that any of the Buyers is a multi-managed
investment vehicle whereby separate portfolio managers manage separate portions of such Buyer’s assets and the portfolio
managers have no direct knowledge of the investment decisions made by the portfolio managers managing other portions of such Buyer’s
assets, the representation set forth above shall only apply with respect to the portion of assets managed by the portfolio manager
that made the investment decision to purchase the Securities covered by this Agreement. “Short Sales” means
all “short sales” as defined in Rule 200 promulgated under Regulation SHO under the Securities Exchange Act of 1934,
as amended (the “1934 Act”).

 

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

 

3.REPRESENTATIONS
AND WARRANTIES OF THE COMPANY.

 

The Company represents
and warrants to each of the Buyers and the Placement Agent that:

 

(a)Organization
and Qualification. Each of the Company and each of its "Subsidiaries" (which for purposes of this Agreement
means any entity in which the Company, directly or indirectly, owns any of the capital stock or holds an equity or similar interest)
are entities duly organized and validly existing and in good standing under the laws of the jurisdiction in which they are formed,
and have the requisite power and authorization to own their properties and to carry on their business as now being conducted and
as presently proposed to be conducted. Each of the Company and each of its Subsidiaries is duly qualified as a foreign entity to
do business and is in good standing in every jurisdiction in which its ownership of property or the nature of the business conducted
by it makes such qualification necessary, except to the extent that the failure to be so qualified or be in good standing would
not reasonably be expected to have a Material Adverse Effect. As used in this Agreement, "Material Adverse Effect"
means any material adverse effect on the business, properties, assets, liabilities, operations, results of operations, condition
(financial or otherwise) or prospects of the Company and its Subsidiaries, individually or taken as a whole, or on the transactions
contemplated hereby or on the other Transaction Documents or by the agreements and instruments to be entered into in connection
herewith or therewith, or on the authority or ability of the Company to perform any of its obligations under any of the Transaction
Documents (as defined below). The Company has no Subsidiaries except as set forth on Schedule 3(a).

 

    	 

    	 

    

 

(b)Authorization;
Enforcement; Validity. The Company has the requisite power and authority to enter into and perform its obligations under this
Agreement, the Notes, the Warrants, the Registration Rights Agreement, the Irrevocable Transfer Agent Instructions (as defined
in Section 5(b)), the Security Documents (as defined below) and each of the other agreements entered into by the parties hereto
in connection with the transactions contemplated by this Agreement (collectively, the "Transaction Documents")
and to issue the Securities in accordance with the terms hereof and thereof. The execution and delivery of this Agreement and the
other Transaction Documents by the Company and the consummation by the Company of the transactions contemplated hereby and thereby,
including, without limitation, the issuance of the Notes and the Warrants, and the reservation for issuance and the issuance of
the Conversion Shares and the reservation for issuance and issuance of Warrant Shares issuable upon exercise of the Warrants have
been duly authorized by the Company's Board of Directors and (other than the filing with the SEC of one or more Registration Statements
(as defined in the Registration Rights Agreement) in accordance with the requirements of the Registration Rights Agreement, the
8-K Filing (as defined below), the Form D with the SEC and other filings as may be required by state securities agencies, the filing
of any necessary Financing Statements and appropriate Assignments for Security in the United States Patent and Trademark Office
or the United States Copyright Office, as applicable, in each case in accordance with the Security Agreement (collectively, the
"Required Filings")) no further filing, consent, or authorization is required by the Company, its Board of Directors
or its stockholders. This Agreement and the other Transaction Documents have been duly executed and delivered by the Company, and
constitute the legal, valid and binding obligations of the Company, enforceable against the Company in accordance with their respective
terms, except as such enforceability may be limited by general principles of equity or applicable bankruptcy, insolvency, reorganization,
moratorium, liquidation or similar laws relating to, or affecting generally, the enforcement of applicable creditors' rights and
remedies and except as rights to indemnification and to contribution may be limited by federal or state securities law and public
policy, and the remedy of specific performance and injunctive and other forms of equitable relief may be subject to equitable defenses
and to the discretion of the court before which any proceeding therefor may be brought. Each of the Subsidiaries party to any of
the Transaction Documents has the requisite power and authority to enter into and perform its obligations under such Transaction
Documents. The execution and delivery by the Subsidiaries party to any of the Transaction Documents of such Transaction Documents
and the consummation by such Subsidiaries of the transactions contemplated thereby have been duly authorized by such Subsidiaries'
respective boards of directors (or other applicable governing body) and (other than filings as may be required by state securities
agencies) no further filing, consent, or authorization is required by such Subsidiaries, their respective boards of directors (or
other applicable governing body) or stockholders (or other applicable owners of equity of such Subsidiaries). The Transaction Documents
to which any of the Subsidiaries are parties have been duly executed and delivered by such Subsidiaries, and constitute the legal,
valid and binding obligations of such Subsidiaries, enforceable against them in accordance with their respective terms, except
as such enforceability may be limited by general principles of equity or applicable bankruptcy, insolvency, reorganization, moratorium,
liquidation or similar laws relating to, or affecting generally, the enforcement of applicable creditors' rights and remedies and
except as rights to indemnification and to contribution may be limited by federal or state securities law and public policy, and
the remedy of specific performance and injunctive and other forms of equitable relief may be subject to equitable defenses and
to the discretion of the court before which any proceeding therefor may be brought. For purposes of this Agreement, the term "Security
Documents" means the Guaranty Agreement, the Security Agreement and any other related collateral documents to be executed
or filed by any of the parties hereto or thereto in connection with the Closing hereunder and in connection with the foregoing
agreements and documents.

 

    	 

    	 

    

 

(c)Issuance
of Securities. The issuance of the Notes and the Warrants are duly authorized and, upon issuance in accordance with the Transaction
Documents, shall be validly issued and free from all preemptive or similar rights, taxes, liens and charges and other encumbrances
with respect to the issue thereof. As of the Closing, a number of shares of Common Stock shall have been duly authorized and reserved
for issuance which equals or exceeds (the "Required Reserved Amount) 125% of the sum of (i) the maximum number of
Conversion Shares issued and issuable pursuant to the Notes based on the Conversion Price (as defined in the Notes) (without taking
into account any limitations on the issuance thereof pursuant to the terms of the Notes) and (ii) the maximum number of Warrant
Shares issued and issuable pursuant to the Warrants (without taking into account any limitations on the exercise of the Warrants
set forth in the Warrants), each as of the Trading Day (as defined in the Warrants) immediately preceding the applicable date
of determination. As of the date hereof, there are 86,136,333 shares of Common Stock authorized and unissued. Upon conversion
of the Notes in accordance with the Notes or exercise of the Warrants in accordance with the Warrants, as the case may be, the
Conversion Shares and the Warrant Shares, respectively, will be validly issued, fully paid and nonassessable and free from all
preemptive or similar rights, taxes, liens and charges and other encumbrances with respect to the issue thereof, with the holders
being entitled to all rights accorded to a holder of Common Stock. Assuming the accuracy of each of the representations and warranties
set forth in Section 2 of this Agreement, the offer and issuance by the Company of the Securities is exempt from registration
under the 1933 Act. The Company has furnished or made available through EDGAR to the non-accredited Buyers any information required
by Rule 502(b) of Regulation D as promulgated by the SEC under the 1933 Act.

 

(d)No
Conflicts. The execution, delivery and performance of the Transaction Documents by the Company and any of its Subsidiaries
parties to any of the Transaction Documents and the consummation by the Company and any of its Subsidiaries of the transactions
contemplated hereby and thereby (including, without limitation, the issuance of the Notes and the Warrants and reservation for
issuance and issuance of the Conversion Shares and the Warrant Shares) will not (i) result in a violation of the Articles of Incorporation
(as defined in Section 3(r)) or Bylaws (as defined in Section 3(r)), any memorandum of association, certificate of incorporation,
certificate of formation, bylaws, any certificate of designations or other constituent documents of the Company or any of its Subsidiaries,
any capital stock of the Company or any of its Subsidiaries or the articles of association or bylaws of the Company or any of its
Subsidiaries or (ii) except as set forth on Schedule 3(d), conflict with, or constitute a default (or an event which with
notice or lapse of time or both would become a default) in any respect under, or give to others any rights of termination, amendment,
acceleration or cancellation of, any agreement, indenture or instrument to which the Company or any of its Subsidiaries is a party,
or (iii) result in a violation of any law, rule, regulation, order, judgment or decree (including foreign, federal and state securities
laws and regulations and the rules and regulations of the OTC QX (the "Principal Market") and including all applicable
foreign, federal and state laws, rules and regulations) applicable to the Company or any of its Subsidiaries or by which any property
or asset of the Company or any of its Subsidiaries is bound or affected except, in the case of clause (ii) or (iii) above, to the
extent such violations that would not reasonably be expected to have a Material Adverse Effect.

 

    	 

    	 

    

 

(e)Consents.
Other than the Required Filings, neither the Company nor any of its Subsidiaries is required to obtain any consent, authorization
or order of, or make any filing or registration with, any court, governmental agency or any regulatory or self-regulatory agency
or any other Person in order for it to execute, deliver or perform any of its obligations under or contemplated by the Transaction
Documents, in each case in accordance with the terms hereof or thereof (other than such consents and approvals to be obtained on
or prior to the Closing Date). All consents, authorizations, orders, filings and registrations which the Company or any of its
Subsidiaries is required to obtain pursuant to the preceding sentence have been obtained or effected on or prior to the Closing
Date (or in the case of the Required Filings, will be made timely after the Closing Date as applicable), and the Company and its
Subsidiaries are unaware of any facts or circumstances that might prevent the Company or any of its Subsidiaries from obtaining
or effecting any of the registration, application or filings pursuant to the preceding sentence. The Company is not in violation
of the requirements for continued qualification of the Principal Market and has no knowledge of any facts or circumstance that
would reasonably lead to removal of the Common Stock from quotation on the Principal Market in the foreseeable future. The issuance
by the Company of the Securities shall not have the effect of removing the Common Stock from quotation on the Principal Market.

 

(f)Acknowledgment
Regarding Buyer's Purchase of Securities. The Company acknowledges and agrees that each Buyer is acting solely in the capacity
of an arm's length purchaser with respect to the Transaction Documents and the transactions contemplated hereby and thereby and
that no Buyer is (i) an officer or director of the Company or any of its Subsidiaries, (ii) an "affiliate" of the Company
or any of its Subsidiaries (as defined in Rule 144) or (iii) to the knowledge of the Company, a "beneficial owner" of
more than 10% of the shares of Common Stock (as defined for purposes of Rule 13d-3 of the Securities Exchange Act of 1934, as amended
(the "1934 Act")). The Company further acknowledges that no Buyer is acting as a financial advisor or fiduciary
of the Company or any of its Subsidiaries (or in any similar capacity) with respect to the Transaction Documents and the transactions
contemplated hereby and thereby, and any advice given by a Buyer or any of its representatives or agents in connection with the
Transaction Documents and the transactions contemplated hereby and thereby is merely incidental to such Buyer's purchase of the
Securities. The Company further represents to each Buyer that the Company's decision to enter into the Transaction Documents has
been based solely on the independent evaluation by the Company and its representatives.

 

    	 

    	 

    

 

(g)No
General Solicitation; Placement Agent's Fees. Neither the Company, nor any of its Subsidiaries or affiliates, nor any Person
acting on its or their behalf, has engaged in any form of general solicitation or general advertising (within the meaning of Regulation
D) in connection with the offer or sale of the Securities. The Company shall be responsible for the payment of any placement agent's
fees, financial advisory fees, or brokers' commissions (other than for Persons engaged by any Buyer or its investment advisor)
relating to or arising out of the transactions contemplated hereby, including, without limitation, the Placement Agent Fees payable
to the Placement Agent pursuant to the terms of the Engagement Letter in connection with the sale of the Securities. The Company
shall pay, and hold each Buyer harmless against, any liability, loss or expense (including, without limitation, attorney's reasonable
and documented fees and out-of-pocket expenses) arising in connection with any such claim. The Company acknowledges that it has
engaged the Placement Agent in connection with the sale of the Securities. Other than the Placement Agent, neither the Company
nor any of its Subsidiaries has engaged any placement agent or other agent in connection with the sale of the Securities.

 

(h)No
Integrated Offering. None of the Company, its Subsidiaries, any of their affiliates, nor any Person acting on their behalf
has, directly or indirectly, made any offers or sales of any security or solicited any offers to buy any security, under circumstances
that would require registration of any of the Securities under the 1933 Act, whether through integration with prior offerings or
otherwise, or cause this offering of the Securities to require approval of stockholders of the Company for purposes of the 1933
Act or any applicable stockholder approval provisions, including, without limitation, under the rules and regulations of any exchange
or automated quotation system on which any of the securities of the Company are designated for quotation. None of the Company,
its Subsidiaries, their affiliates and any Person acting on their behalf will take any action or steps referred to in the preceding
sentence that would require registration of any of the Securities under the 1933 Act or cause the offering of any of the Securities
to be integrated with other offerings for purposes of any such applicable stockholder approval provisions.

 

(i)Dilutive
Effect. The Company understands and acknowledges that the number of Conversion Shares issuable pursuant to terms of the Notes
and the Warrant Shares issuable upon exercise of the Warrants will increase in certain circumstances. The Company further acknowledges
that its obligation to issue Conversion Shares pursuant to the terms of the Notes in accordance with this Agreement and the Notes
and the Warrant Shares pursuant to the terms of the Warrants in accordance with this Agreement and the Warrants is, in each case,
absolute and unconditional regardless of the dilutive effect that such issuance may have on the ownership interests of other stockholders
of the Company.

 

(j)Application
of Takeover Protections; Rights Agreement. The Company and its board of directors have taken all necessary action, if any,
in order to render inapplicable any control share acquisition, interested stockholder, business combination, poison pill (including,
without limitation, any distribution under a rights agreement) or other similar anti-takeover provision under the Articles of Incorporation,
Bylaws or other organizational documents or the laws of the jurisdiction of its formation which is or could become applicable to
any Buyer as a result of the transactions contemplated by this Agreement, including, without limitation, the Company's issuance
of the Securities and any Buyer's ownership of the Securities. The Company has not adopted a stockholder rights plan or similar
arrangement relating to accumulations of beneficial ownership of Common Stock or a change in control of the Company or any of its
Subsidiaries.

 

    	 

    	 

    

 

(k)SEC
Documents; Financial Statements. Except as disclosed in Schedule 3(k), since September 4, 2013, the Company has timely filed
all reports, schedules, forms, statements and other documents required to be filed by it with the SEC pursuant to the reporting
requirements of the 1934 Act (all of the foregoing filed prior to the date hereof, and all exhibits included therein and financial
statements, notes and schedules thereto and documents incorporated by reference therein being hereinafter referred to as the "SEC
Documents"). The Company has delivered to the Buyers or their respective representatives true, correct and complete copies
of the SEC Documents not available on the EDGAR system. As of their respective filing dates, the SEC Documents complied in all
material respects with the requirements of the 1934 Act and the rules and regulations of the SEC promulgated thereunder applicable
to the SEC Documents, and none of the SEC Documents, at the time they were filed with the SEC, contained any untrue statement of
a material fact or omitted to state a material fact required to be stated therein or necessary in order to make the statements
therein, in the light of the circumstances under which they were made, not misleading. As of their respective filing dates, the
financial statements of the Company included in the SEC Documents complied as to form in all material respects with applicable
accounting requirements and the published rules and regulations of the SEC with respect thereto. Such financial statements have
been prepared in accordance with United States generally accepted accounting principles, consistently applied, during the periods
involved ("GAAP") (except (i) as may be otherwise indicated in such financial statements or the notes thereto,
or (ii) in the case of unaudited interim statements, to the extent they may exclude footnotes or may be condensed or summary statements)
and fairly present in all material respects the financial position of the Company and its Subsidiaries as of the dates thereof
and the results of its operations and cash flows for the periods then ended (subject, in the case of unaudited statements, to normal
year-end audit adjustments which will not be material, either individually or in the aggregate). No other information provided
by or on behalf of the Company to any of the Buyers which is not included in the SEC Documents, including, without limitation,
information referred to in Section 2(d) of this Agreement or in the disclosure schedules to this Agreement, contains any untrue
statement of a material fact or omits to state any material fact necessary in order to make the statements therein, in the light
of the circumstance under which they are or were made, not misleading.

 

(l)Absence
of Certain Changes. Since December 31, 2013, there has been no material adverse change and no material adverse development
in the business, assets, liabilities, properties, operations, condition (financial or otherwise), results of operations or prospects
of the Company or its Subsidiaries. Since December 31, 2013, neither the Company nor any of its Subsidiaries has (i) declared or
paid any dividends, (ii) sold any assets, individually or in the aggregate, in excess of $100,000 outside of the ordinary course
of business or (iii) had capital expenditures, individually or in the aggregate, in excess of $100,000. Neither the Company nor
any of its Subsidiaries has taken any steps to seek protection pursuant to any law or statute relating to bankruptcy, insolvency,
reorganization, liquidation or winding up, nor does the Company or any Subsidiary have any knowledge or reason to believe that
any of their respective creditors intend to initiate involuntary bankruptcy proceedings or any actual knowledge of any fact that
would reasonably lead a creditor to do so. The Company and its Subsidiaries, individually and on a consolidated basis, will not
be, after giving effect to the transactions contemplated hereby to occur at the Closing, Insolvent (as defined below). For purposes
of this Section 3(l), "Insolvent" means, with respect to any Person, (i) the present fair saleable value of such
Person's assets is less than the amount required to pay such Person's total Indebtedness (as defined in Section 3(s)), (ii) such
Person is unable to pay its debts and liabilities, subordinated, contingent or otherwise, as such debts and liabilities become
absolute and matured, (iii) such Person intends to incur or believes that it will incur debts that would be beyond its ability
to pay as such debts mature or (iv) such Person has unreasonably small capital with which to conduct the business in which it is
engaged as such business is now conducted and is proposed to be conducted.

 

    	 

    	 

    

 

(m)No
Undisclosed Events, Liabilities, Developments or Circumstances. Except as set forth on Schedule 3(m), no event, liability,
development or circumstance has occurred or exists, or is contemplated to occur with respect to the Company, its Subsidiaries or
their respective business, properties, prospects, operations or financial condition, that would be required to be disclosed by
the Company under applicable securities laws on a registration statement on Form S-1 filed with the SEC relating to an issuance
and sale by the Company of its Common Stock and which has not been publicly announced.

 

(n)Conduct
of Business; Regulatory Permits. Neither the Company nor any of its Subsidiaries is in violation of any term of or in default
under any certificate of designations of any outstanding series of preferred stock of the Company (if any), its Articles of Incorporation
or Bylaws or their organizational charter or memorandum of association or certificate of incorporation or articles of association
or bylaws, respectively. Neither the Company nor any of its Subsidiaries is in violation of any judgment, decree or order or any
statute, ordinance, rule or regulation applicable to the Company or any of its Subsidiaries, and neither the Company nor any of
its Subsidiaries will conduct its business in violation of any of the foregoing, except for possible violations which could not,
individually or in the aggregate, reasonably be expected to have a Material Adverse Effect. Without limiting the generality of
the foregoing, the Company is not in violation of any of the rules, regulations or requirements of the Principal Market and has
no knowledge of any facts or circumstances that would reasonably lead to the removal from quotation of the Common Stock by the
Principal Market in the foreseeable future. Since September 4, 2013, the Common Stock has been designated for quotation on the
Principal Market. Since September 4, 2013, (i) trading in the Common Stock has not been suspended by the SEC or halted by the Financial
Industry Regulatory Authority, Inc. ("FINRA") and (ii) the Company has received no communication, written or oral,
from the SEC, the Principal Market or FINRA regarding the suspension or halting from trading on the Principal Market or removal
from quotation of the Common Stock from the Principal Market. The Company and each of its Subsidiaries possess all certificates,
authorizations and permits issued by the appropriate federal, state or foreign regulatory authorities necessary to conduct their
respective businesses, except where the failure to possess such certificates, authorizations or permits would not have, individually
or in the aggregate, a Material Adverse Effect, and neither the Company nor any such Subsidiary has received any notice of proceedings
relating to the revocation or modification of any such certificate, authorization or permit.

 

(o)Foreign
Corrupt Practices. Neither the Company, nor any of its Subsidiaries, nor any director, officer, agent, employee or other Person
acting on behalf of the Company or any of its Subsidiaries has, in the course of its actions for, or on behalf of, the Company
or any of its Subsidiaries (i) used any corporate funds for any unlawful contribution, gift, entertainment or other unlawful expenses
relating to political activity; (ii) made any direct or indirect unlawful payment to any foreign or domestic government official
or employee from corporate funds; (iii) violated or is in violation of any provision of the U.S. Foreign Corrupt Practices Act
of 1977, as amended; or (iv) made any unlawful bribe, rebate, payoff, influence payment, kickback or other unlawful payment to
any foreign or domestic government official or employee.

 

    	 

    	 

    

 

(p)Sarbanes-Oxley
Act. Except as set forth on Schedule 3(p), the Company is in compliance with any and all applicable requirements of
the Sarbanes-Oxley Act of 2002, as amended, that are effective as of the date hereof, and any and all applicable rules and regulations
promulgated by the SEC thereunder that are effective as of the date hereof. The matter set forth in Schedule 3(p) would
not reasonably be expected to have a Material Adverse Effect.

 

(q)Transactions
With Affiliates. Except as set forth on Schedule 3(q), none of the officers, directors or employees of the Company or
any of its Subsidiaries is presently a party to any transaction with the Company or any of its Subsidiaries (other than for ordinary
course services as employees, officers or directors), including any contract, agreement or other arrangement providing for the
furnishing of services to or by, providing for rental of real or personal property to or from, or otherwise requiring payments
to or from any such officer, director or employee or, to the knowledge of the Company or any of its Subsidiaries, any corporation,
partnership, trust or other entity in which any such officer, director, or employee has a substantial interest or is an officer,
director, trustee or partner.

 

(r)Equity
Capitalization. As of the date hereof, the authorized capital stock of the Company consists of (i) 100,000,000 shares of Common
Stock, of which as of the date hereof, 13,863,667 shares are issued and outstanding, 1,500,000 shares are reserved for issuance
pursuant to the Company's stock option and purchase plans and 9,850,471 shares are reserved for issuance pursuant to securities
(other than the aforementioned options, the Notes and the Warrants) exercisable or exchangeable for, or convertible into, Common
Stock, and (ii) 10,000,000 shares of preferred stock, par value $0.001 per share, none of which are issued and outstanding as of
the date hereof. No shares of Common Stock are held in treasury and all of such outstanding shares are duly authorized and have
been, or upon issuance will be, validly issued and are fully paid and nonassessable. (i) None of the Company's or any Subsidiary's
capital stock is subject to preemptive rights or any other similar rights or any liens or encumbrances suffered or permitted by
the Company or any Subsidiary; (ii) except as disclosed in Schedule 3(r)(ii), there are no outstanding options, warrants,
scrip, rights to subscribe to, calls or commitments of any character whatsoever relating to, or securities or rights convertible
into, or exercisable or exchangeable for, any shares of capital stock of the Company or any of its Subsidiaries, or contracts,
commitments, understandings or arrangements by which the Company or any of its Subsidiaries is or may become bound to issue additional
shares or capital stock of the Company or any of its Subsidiaries or options, warrants, scrip, rights to subscribe to, calls or
commitments of any character whatsoever relating to, or securities or rights convertible into, or exercisable or exchangeable for,
any shares of capital stock of the Company or any of its Subsidiaries; (iii) except as disclosed in Schedule 3(r)(iii),
there are no outstanding debt securities, notes, credit agreements, credit facilities or other agreements, documents or instruments
evidencing Indebtedness of the Company or any of its Subsidiaries or by which the Company or any of its Subsidiaries is or may
become bound; (iv) there are no financing statements securing obligations in any material amounts filed in connection with the
Company or any of its Subsidiaries; (v) except as disclosed in Schedule 3(r)(v), there are no agreements or arrangements
under which the Company or any of its Subsidiaries is obligated to register the sale of any of their securities under the 1933
Act (except pursuant to the Registration Rights Agreement); (vi) there are no outstanding securities or instruments of the Company
or any of its Subsidiaries which contain any redemption or similar provisions, and there are no contracts, commitments, understandings
or arrangements by which the Company or any of its Subsidiaries is or may become bound to redeem a security of the Company or any
of its Subsidiaries; (vii) except as disclosed in Schedule 3(r)(vii), there are no securities or instruments containing
anti-dilution or similar provisions that will be triggered by the issuance of the Securities; (viii) neither the Company nor any
Subsidiary has any stock appreciation rights or "phantom stock" plans or agreements or any similar plan or agreement;
and (ix) neither the Company nor any Subsidiary has any liabilities or obligations required to be disclosed in the SEC Documents
but not so disclosed in the SEC Documents, other than those incurred in the ordinary course of the Company's or any of its Subsidiary's'
respective businesses and which, individually or in the aggregate, do not or would not have a Material Adverse Effect. The Company
has furnished or made available to the Buyers true, correct and complete copies of the Company's Articles of Incorporation, as
amended and as in effect on the date hereof (the "Articles of Incorporation"), and the Company's Bylaws, as amended
and as in effect on the date hereof (the "Bylaws"), and the terms of all securities convertible into, or exercisable
or exchangeable for shares of Common Stock and the material rights of the holders thereof in respect thereto.

 

    	 

    	 

    

 

(s)Indebtedness
and Other Contracts. (i) Except as disclosed in Schedule 3(s)(i), neither the Company nor any of its Subsidiaries has
any outstanding Indebtedness (as defined below), (ii) except as disclosed in Schedule 3(s)(ii), neither the Company nor
any of its Subsidiaries is a party to any contract, agreement or instrument, the violation of which, or default under which, by
the other party(ies) to such contract, agreement or instrument could reasonably be expected to result in a Material Adverse Effect,
(iii) neither the Company nor any of its Subsidiaries is in violation of any term of or in default under any contract, agreement
or instrument relating to any Indebtedness, except where such violations and defaults would not result, individually or in the
aggregate, in a Material Adverse Effect, or (iv) neither the Company nor any of its Subsidiaries is a party to any contract, agreement
or instrument relating to any Indebtedness, the performance of which, in the judgment of the Company's officers, has or is expected
to have a Material Adverse Effect. Schedule 3(s)(i) provides a detailed description of the material terms of any such outstanding
Indebtedness. For purposes of this Agreement: (x) "Indebtedness" of any Person means, without duplication (A)
all indebtedness for borrowed money in excess of $50,000, (B) all obligations issued, undertaken or assumed as the deferred purchase
price of property or services, including, without limitation, "capital leases" in accordance with GAAP (other than trade
payables entered into in the ordinary course of business consistent with past practice), (C) all reimbursement or payment obligations
with respect to letters of credit, surety bonds and other similar instruments, (D) all obligations evidenced by notes, bonds, debentures
or similar instruments, including obligations so evidenced incurred in connection with the acquisition of property, assets or businesses,
(E) all indebtedness created or arising under any conditional sale or other title retention agreement, or incurred as financing,
in either case with respect to any property or assets acquired with the proceeds of such indebtedness (even though the rights and
remedies of the seller or bank under such agreement in the event of default are limited to repossession or sale of such property),
(F) all monetary obligations under any leasing or similar arrangement which, in connection with GAAP, consistently applied for
the periods covered thereby, is classified as a capital lease, (G) all indebtedness referred to in clauses (A) through (F) above
secured by (or for which the holder of such Indebtedness has an existing right, contingent or otherwise, to be secured by) any
mortgage, claim, tax, right of first refusal, lien, pledge, charge, security interest or other encumbrance upon or in any property
or assets (including accounts and contract rights) owned by any Person, even though the Person which owns such assets or property
has not assumed or become liable for the payment of such indebtedness, and (H) all Contingent Obligations in respect of indebtedness
or obligations of others of the kinds referred to in clauses (A) through (G) above; and (y) "Contingent Obligation"
means, as to any Person, any direct or indirect liability, contingent or otherwise, of that Person with respect to any Indebtedness,
lease, dividend or other obligation of another Person if the primary purpose or intent of the Person incurring such liability,
or the primary effect thereof, is to provide assurance to the obligee of such liability that such liability will be paid or discharged,
or that any agreements relating thereto will be complied with, or that the holders of such liability will be protected (in whole
or in part) against loss with respect thereto.

 

    	 

    	 

    

 

(t)Absence
of Litigation. There is no action, suit, proceeding, inquiry or investigation before or by the Principal Market, any court,
public board, government agency, self-regulatory organization or body pending or, to the knowledge of the Company, threatened against
or affecting the Company or any of its Subsidiaries, the Common Stock or any of the Company's Subsidiaries or any of the Company's
or its Subsidiaries' officers or directors, whether of a civil or criminal nature or otherwise, in their capacities as such

 

(u)Insurance.
The Company and each of its Subsidiaries are insured by insurers of recognized financial responsibility against such losses and
risks and in such amounts as management of the Company believes to be prudent and customary in the businesses in which the Company
and its Subsidiaries are engaged. Neither the Company nor any such Subsidiary has been refused any insurance coverage sought or
applied for and neither the Company nor any such Subsidiary has any reason to believe that it will not be able to renew its existing
insurance coverage as and when such coverage expires or to obtain similar coverage from similar insurers as may be necessary to
continue its business at a cost that would not have a Material Adverse Effect.

 

(v)Employee
Relations.

 

(i)Neither
the Company nor any of its Subsidiaries is a party to any collective bargaining agreement or employs any member of a union. The
Company and its Subsidiaries believe that their relations with their employees are good. No executive officer or other key employee
of the Company or any of its Subsidiaries (as defined in Rule 501(f) of the 1933 Act) has notified the Company or any such Subsidiary
that such officer intends to leave the Company or any such Subsidiary or otherwise terminate such officer's employment with the
Company or any such Subsidiary. No executive officer or other key employee of the Company or any of its Subsidiaries is, or is
now expected to be, in violation of any material term of any employment contract, confidentiality, disclosure or proprietary information
agreement, non-competition agreement, or any other contract or agreement or any restrictive covenant, and the continued employment
of each such executive officer or other key employee (as the case may be) does not subject the Company or any of its Subsidiaries
to any liability with respect to any of the foregoing matters.

 

    	 

    	 

    

 

(ii)The
Company and its Subsidiaries are in compliance with all federal, state, local and foreign laws and regulations respecting labor,
employment and employment practices and benefits, terms and conditions of employment and wages and hours, except where failure
to be in compliance would not, either individually or in the aggregate, reasonably be expected to result in a Material Adverse
Effect.

 

(w)Title.
The Company and its Subsidiaries have good and marketable title in fee simple to all real property and good and marketable title
to all personal property owned by them which is material to the business of the Company and its Subsidiaries, in each case free
and clear of all liens, encumbrances and defects except for Permitted Liens (as defined in the Notes), which do not materially
affect the value of such property and do not interfere with the use made or proposed to be made of such property by the Company
and any of its Subsidiaries. Any real property and facilities held under lease by the Company or any of its Subsidiaries are held
by them under valid, subsisting and enforceable leases with such exceptions as are not material and do not interfere with the use
made and proposed to be made of such property and buildings by the Company or any of its Subsidiaries.

 

(x)Intellectual
Property Rights. The Company and its Subsidiaries own or possess adequate rights or licenses to use all trademarks, trade names,
service marks, service mark registrations, service names, original works of authorship, patents, patent rights, copyrights, inventions,
licenses, approvals, governmental authorizations, trade secrets and other intellectual property rights and all applications and
registrations therefor ("Intellectual Property Rights") necessary to conduct their respective businesses as now
conducted and as presently proposed to be conducted. Each of patents owned by the Company or any of its Subsidiaries is listed
on Schedule 3(x)(i). Except as set forth in Schedule 3(x)(ii), none of the Company's Intellectual Property Rights
have expired or terminated or have been abandoned or are expected to expire or terminate or are expected to be abandoned, within
three years from the date of this Agreement. The Company does not have any knowledge of any infringement by the Company or any
of its Subsidiaries of Intellectual Property Rights of others. There is no claim, action or proceeding being made or brought, or
to the knowledge of the Company or any of its Subsidiaries, being threatened, against the Company or any of its Subsidiaries regarding
its Intellectual Property Rights. Neither the Company nor any of its Subsidiaries is aware of any facts or circumstances which
might give rise to any of the foregoing infringements or claims, actions or proceedings. The Company and its Subsidiaries have
taken reasonable security measures to protect the secrecy, confidentiality and value of all of their Intellectual Property Rights.

 

(y)Environmental
Laws. The Company and its Subsidiaries (i) are in compliance with any and all Environmental Laws (as hereinafter defined),
(ii) have received all permits, licenses or other approvals required of them under applicable Environmental Laws to conduct their
respective businesses and (iii) are in compliance with all terms and conditions of any such permit, license or approval where,
in each of the foregoing clauses (i), (ii) and (iii), the failure to so comply could be reasonably expected to have, individually
or in the aggregate, a Material Adverse Effect. The term "Environmental Laws" means all federal, state, local
or foreign laws relating to pollution or protection of human health or the environment (including, without limitation, ambient
air, surface water, groundwater, land surface or subsurface strata), including, without limitation, laws relating to emissions,
discharges, releases or threatened releases of chemicals, pollutants, contaminants, or toxic or hazardous substances or wastes
(collectively, "Hazardous Materials") into the environment, or otherwise relating to the manufacture, processing,
distribution, use, treatment, storage, disposal, transport or handling of Hazardous Materials, as well as all authorizations, codes,
decrees, demands or demand letters, injunctions, judgments, licenses, notices or notice letters, orders, permits, plans or regulations
issued, entered, promulgated or approved thereunder.

 

    	 

    	 

    

 

(z)Subsidiary
Rights. The Company or one of its Subsidiaries has the unrestricted right to vote, and (subject to limitations imposed by applicable
law) to receive dividends and distributions on, all capital securities of its Subsidiaries as owned by the Company or such Subsidiary.

 

(aa)Investment
Company Status. Neither the Company nor any of its Subsidiaries is, nor upon consummation of the sale of the Securities, and
for so long any Buyer holds any Securities, will be, an "investment company," a company controlled by an "investment
company" or an "affiliated person" of, or "promoter" or "principal underwriter" for, an "investment
company" as such terms are defined in the Investment Company Act of 1940, as amended.

 

(bb)Tax
Status. The Company and each of its Subsidiaries (i) has made or filed all U.S. federal, state and foreign income and all other
material tax returns, reports and declarations required by any jurisdiction to which it is subject, (ii) has paid all taxes and
other governmental assessments and charges that are material in amount, shown or determined to be due on such returns, reports
and declarations, except those being contested in good faith and (iii) has set aside on its books provision reasonably adequate
for the payment of all taxes for periods subsequent to the periods to which such returns, reports or declarations apply. There
are no unpaid taxes in any material amount claimed to be due by the taxing authority of any jurisdiction, and the officers of the
Company and its Subsidiaries know of no basis for any such claim.

 

(cc)Internal
Accounting and Disclosure Controls. Except as disclosed in Schedule 3(cc), the Company and each of its Subsidiaries
maintain a system of internal accounting controls sufficient to provide reasonable assurance that (i) transactions are executed
in accordance with management's general or specific authorizations, (ii) transactions are recorded as necessary to permit preparation
of financial statements in conformity with GAAP and to maintain asset and liability accountability, (iii) access to assets or incurrence
of liabilities is permitted only in accordance with management's general or specific authorization and (iv) the recorded accountability
for assets and liabilities is compared with the existing assets and liabilities at reasonable intervals and appropriate action
is taken with respect to any difference. Except as disclosed in Schedule 3(cc), the Company maintains disclosure controls
and procedures (as such term is defined in Rule 13a-15 under the 1934 Act) that are effective in ensuring that information required
to be disclosed by the Company in the reports that it files or submits under the 1934 Act is recorded, processed, summarized and
reported, within the time periods specified in the rules and forms of the SEC, including, without limitation, controls and procedures
designed to ensure that information required to be disclosed by the Company in the reports that it files or submits under the 1934
Act is accumulated and communicated to the Company's management, including its principal executive officer or officers and its
principal financial officer or officers, as appropriate, to allow timely decisions regarding required disclosure. During the twelve
months prior to the date hereof neither the Company nor any of its Subsidiaries has received any notice or correspondence from
any accountant relating to any material weakness, other than those material weaknesses disclosed in Schedule 3(cc), in any
part of the system of internal accounting controls of the Company or any of its Subsidiaries.

 

    	 

    	 

    

 

(dd)Off
Balance Sheet Arrangements. There is no transaction, arrangement, or other relationship between the Company or any of its Subsidiaries
and an unconsolidated or other off balance sheet entity that is required to be disclosed by the Company in its 1934 Act filings
and is not so disclosed or that otherwise would be reasonably likely to have a Material Adverse Effect.

 

(ee)Ranking
of Notes. Except as disclosed on Schedule 3(ee), no Indebtedness of the Company or any of its Subsidiaries is senior to or
ranks pari passu with the Notes in right of payment, whether with respect of payment of redemptions, interest, damages or
upon liquidation or dissolution or otherwise.

 

(ff)Eligibility
for Registration. The Company is eligible to register the Conversion Shares and the Warrant Shares for resale by the Buyers
using Form S-1 promulgated under the 1933 Act.

 

(gg)Transfer
Taxes. On the Closing Date, all stock transfer or other taxes (other than income or similar taxes) which are required to be
paid in connection with the sale and transfer of the Securities to be sold to each Buyer hereunder will be, or will have been,
fully paid or provided for by the Company, and all laws imposing such taxes will be or will have been complied with.

 

(hh)Manipulation
of Price. The Company has not, and to its knowledge no one acting on its behalf has, (i) taken, directly or indirectly, any
action designed to cause or to result, or that could reasonably be expected to cause or result, in the stabilization or manipulation
of the price of any security of the Company to facilitate the sale or resale of any of the Securities, (ii) other than the Placement
Agent, sold, bid for, purchased, or paid any compensation for soliciting purchases of, any of the Securities, or (iii) other than
the Placement Agent, paid or agreed to pay to any person any compensation for soliciting another to purchase any other securities
of the Company.

 

(ii)Acknowledgement
Regarding Buyers' Trading Activity. The Company acknowledges and agrees that (i) none of the Buyers has been asked to agree,
nor has any Buyer agreed, to desist from purchasing or selling, long and/or short, securities of the Company, or "derivative"
securities based on securities issued by the Company or to hold the Securities for any specified term; (ii) any Buyer, and counter-parties
in "derivative" transactions to which any such Buyer is a party, directly or indirectly, presently may have a "short"
position in the Common Stock, and (iii) each Buyer shall not be deemed to have any affiliation with or control over any arm's length
counter-party in any "derivative" transaction. The Company further understands and acknowledges that (a) one or more
Buyers may engage in hedging and/or trading activities at various times during the period that the Securities are outstanding,
including, without limitation, during the periods that the value of the Conversion Shares and/or the Warrant Shares are being determined
and (b) such hedging and/or trading activities, if any, can reduce the value of the existing stockholders' equity interest in the
Company both at and after the time the hedging and/or trading activities are being conducted. The Company acknowledges that such
aforementioned hedging and/or trading activities do not constitute a breach of this Agreement, the Notes, the Warrants or any of
the documents executed in connection herewith.

 

    	 

    	 

    

 

(jj)U.S.
Real Property Holding Corporation. Neither the Company nor any of its Subsidiaries is or has ever been, and so long as any
Securities remain outstanding, shall not become, a U.S. real property holding corporation within the meaning of Section 897 of
the Code and the Company shall so certify upon any Buyer's request.

 

(kk)Bank
Holding Company Act. Neither the Company nor any of its Subsidiaries or affiliates is subject to the Bank Holding Company Act
of 1956, as amended (the "BHCA") and to regulation by the Board of Governors of the Federal Reserve System (the
"Federal Reserve"). Neither the Company nor any of its Subsidiaries or affiliates owns or controls, directly or
indirectly, five percent (5%) or more of the outstanding shares of any class of voting securities or twenty-five percent (25%)
or more of the total equity of a bank or any entity that is subject to the BHCA and to regulation by the Federal Reserve. Neither
the Company nor any of its Subsidiaries or affiliates exercises a controlling influence over the management or policies of a bank
or any entity that is subject to the BHCA and to regulation by the Federal Reserve.

 

(ll)No
Additional Agreements. Neither the Company nor any of its Subsidiaries has any agreement or understanding with any Buyer with
respect to the transactions contemplated by the Transaction Documents other than as specified in the Transaction Documents.

 

(mm)Disclosure.
After the time of the filing of the Form 8-K (as defined below), the Company confirms that neither it nor any other Person acting
on its behalf has provided any of the Buyers or their agents or counsel with any information that constitutes or could reasonably
be expected to constitute material, nonpublic information concerning the Company or any of its Subsidiaries. The Company understands
and confirms that each of the Buyers will rely on the foregoing representations in effecting transactions in securities of the
Company. All disclosure provided to the Buyers regarding the Company, or any of its Subsidiaries, their business and the transactions
contemplated hereby, including the disclosure schedules to this Agreement, furnished by or on behalf of the Company or any of its
Subsidiaries is true and correct and does not contain any untrue statement of a material fact or omit to state any material fact
necessary in order to make the statements made therein, in the light of the circumstances under which they were made, not misleading.
All of the written information furnished after the date hereof by or on behalf of the Company or any of its Subsidiaries to you
pursuant to or in connection with this Agreement and the other Transaction Documents, taken as a whole, will be true and correct
in all material respects as of the date on which such information is so provided and will not contain any untrue statement of a
material fact or omit to state any material fact necessary in order to make the statements made therein, in the light of the circumstances
under which they are made, not misleading. The Company acknowledges and agrees that no Buyer makes or has made any representations
or warranties with respect to the transactions contemplated hereby other than those specifically set forth in Section 2.

 

    	 

    	 

    

 

(nn)Shell
Company Status. The Company is not, and has not been since September 4, 2013, an issuer identified in Rule 144(i)(1) of the
1933 Act. As of September 4, 2013, the Company filed current "Form 10 information" (as defined in Rule 144 (i)(3)) with
the SEC reflecting its status as an entity that was no longer an issuer described in Rule 144(i)(1)(i).

 

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

 

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

 

(qq)No
Disqualification Events. With respect to Securities to be offered and sold hereunder in reliance on Rule 506(b) under the 1933
Act ("Regulation D Securities"), none of the Company, any of its predecessors, any affiliated issuer, any director,
executive officer, other officer of the Company participating in the offering hereunder, any beneficial owner of 20% or more of
the Company's outstanding voting equity securities, calculated on the basis of voting power, nor any promoter (as that term is
defined in Rule 405 under the 1933 Act) connected with the Company in any capacity at the time of sale (each, an "Issuer
Covered Person" and, together, "Issuer Covered Persons") is subject to any of the "Bad Actor"
disqualifications described in Rule 506(d)(1)(i) to (viii) under the 1933 Act (a "Disqualification Event"), except
for a Disqualification Event covered by Rule 506(d)(2) or (d)(3). The Company has exercised reasonable care to determine whether
any Issuer Covered Person is subject to a Disqualification Event. The Company has complied, to the extent applicable, with its
disclosure obligations under Rule 506(e), and has furnished to the Buyers a copy of any disclosures provided thereunder.

 

    	 

    	 

    

 

(rr)Other
Covered Persons. The Company is not aware of any Person (other than the Placement Agent) that has been or will be paid (directly
or indirectly) remuneration for solicitation of Buyers or potential purchasers in connection with the sale of any Regulation D
Securities.

 

(ss)Money
Laundering.  The Company and its Subsidiaries are in compliance with, and have not previously violated, the USA Patriot
Act of 2001 and all other applicable U.S. and non-U.S. anti-money laundering laws and regulations, including, but not limited to,
the laws, regulations and Executive Orders and sanctions programs administered by the U.S. Office of Foreign Assets Control, including,
but not limited, to (i) Executive Order 13224 of September 23, 2001 entitled, "Blocking Property and Prohibiting Transactions
With Persons Who Commit, Threaten to Commit, or Support Terrorism" (66 Fed. Reg. 49079 (2001)); and (ii) any regulations contained
in 31 CFR, Subtitle B, Chapter V.

 

4.COVENANTS.

 

(a)Reasonable
Best Efforts. Each party shall use its reasonably best efforts timely to satisfy each of the covenants and the conditions to
be satisfied by it as provided in Sections 6 and 7 of this Agreement.

 

(b)Form
D and Blue Sky. The Company agrees to file a Form D with respect to the Securities as required under Regulation D and to provide
a copy thereof to each Buyer promptly after such filing. The Company shall, on or promptly after the Closing Date, take such action
as the Company shall reasonably determine is necessary in order to obtain an exemption for or to qualify the Securities for sale
to the Buyers at the Closing pursuant to this Agreement under applicable securities or "Blue Sky" laws of the states
of the United States (or to obtain an exemption from such qualification), and shall provide evidence of any such action so taken
to the Buyers on or promptly after the Closing Date. The Company shall make all filings and reports relating to the offer and sale
of the Securities required under applicable securities or "Blue Sky" laws of the states of the United States following
the Closing Date.

 

(c)Reporting
Status. Until the date on which the Investors (as defined in the Registration Rights Agreement) shall have sold all of the
Conversion Shares and Warrant Shares and none of the Notes or Warrants are outstanding (the "Reporting Period"),
the Company shall use its reasonable best efforts to file all reports required to be filed with the SEC pursuant to the 1934 Act,
and the Company shall not terminate its status as an issuer required to file reports under the 1934 Act even if the 1934 Act or
the rules and regulations thereunder would no longer require or otherwise permit such termination.

 

(d)Use
of Proceeds. The Company will use the proceeds from the sale of the Securities solely for (i) the repayment of the $100,000
promissory note issued by the Company to Gordian Group, LLC on August 25, 2014 (the “Gordian Indebtedness”)
and (ii) general corporate purposes and for working capital purposes but not for (x) the repayment of any outstanding Indebtedness
of the Company or any of its Subsidiaries other than the Gordian Indebtedness or (y) the redemption or repurchase or any of its
Subsidiaries equity securities.

 

    	 

    	 

    

 

(e)Financial
Information. The Company agrees to send the following to each Investor during the Reporting Period, unless the following are
filed with the SEC through EDGAR and are available to the public through the EDGAR system, (i) within one (1) Business Day after
the filing thereof with the SEC, a copy of its Annual Reports on Form 10-K, any Quarterly Reports on Form 10-Q, any Current Reports
on Form 8-K (or any analogous reports under the 1934 Act) and any registration statements (other than on Form S-8) or amendments
filed pursuant to the 1933 Act, and (ii) copies of any notices and other information made available or given to the stockholders
of the Company generally, contemporaneously with the making available or giving thereof to the stockholders. As used herein, "Business
Day" means any day other than Saturday, Sunday or other day on which commercial banks in The City of New York are authorized
or required by law to remain closed.

 

(f)Listing.
The Company shall maintain the authorization for quotation of the Common Stock on the Principal Market or any other Eligible Market
(as defined in the Warrants). Neither the Company nor any of its Subsidiaries shall take any action which would be reasonably expected
to result in the removal from quotation of the Common Stock on the Principal Market unless the Common Stock has been or is being
listed or quoted on another Eligible Market prior to, or contemporaneously with, such removal. If after the date hereof the Common
Stock becomes listed on an Eligible Market that is a national securities exchange, the Company shall promptly secure the listing
of all of the Registrable Securities (as defined in the Registration Rights Agreement) and shall maintain such listing of all Registrable
Securities from time to time issuable under the terms of the Transaction Documents for so long as the Common Stock remains listed
on such Eligible Market. The Company shall pay all fees and expenses in connection with satisfying its obligations under this Section
4(f).

 

(g)Fees.
The Company shall be responsible for the payment of any placement agent's fees, financial advisory fees, or broker's commissions
(other than for Persons engaged by any Buyer) relating to or arising out of the transactions contemplated hereby, including, without
limitation, any Placement Agent Fees payable to the Placement Agent in accordance with the Engagement Letter. The Company shall
pay, and hold each Buyer harmless against, any liability, loss or expense (including, without limitation, reasonable attorney's
fees and out-of-pocket expenses) arising in connection with any claim relating to any such payment. Except as otherwise set forth
in the Transaction Documents and the Engagement Letter, each party to this Agreement shall bear its own expenses in connection
with the sale of the Securities to the Buyers.

 

(h)Pledge
of Securities. The Company acknowledges and agrees that the Securities may be pledged by an Investor in connection with a bona
fide margin agreement or other loan or financing arrangement that is secured by the Securities. The pledge of Securities shall
not be deemed to be a transfer, sale or assignment of the Securities hereunder, and no Investor effecting a pledge of Securities
shall be required to provide the Company with any notice thereof or otherwise make any delivery to the Company pursuant to this
Agreement or any other Transaction Document, including, without limitation, Section 2(f) hereof; provided that an Investor
and its pledgee shall be required to comply with the provisions of Section 2(f) hereof in order to effect a sale, transfer or assignment
of Securities to such pledgee. The Company hereby agrees, at such applicable Buyer’s expense, to execute and deliver such
documentation as a pledgee of the Securities may reasonably request in connection with a pledge of the Securities to such pledgee
by an Investor.

 

    	 

    	 

    

 

(i)Disclosure
of Transactions and Other Material Information. On or before 8:30 a.m., New York City time, on the first Business Day after
this Agreement has been executed, the Company shall file a Current Report on Form 8-K describing the terms of the transactions
contemplated by the Transaction Documents in the form required by the 1934 Act and attaching the material Transaction Documents
(including, without limitation, this Agreement, the form of Warrant, the form of Note, the Registration Rights Agreement, the Security
Agreement and the form of Guaranty, the "8-K Filing"). From and after the filing of the 8-K Filing with the SEC,
no Buyer shall be in possession of any material, nonpublic information received from the Company, any of its Subsidiaries or any
of their respective officers, directors, affiliates, employees or agents, that is not publicly disclosed prior to the date of the
8-K Filing or in the 8-K Filing. In addition, effective upon the filing of the 8-K Filing, the Company acknowledges and agrees
that any and all confidentiality or similar obligations under any agreement, whether written or oral, between the Company, any
of its Subsidiaries or any of their respective officers, directors, affiliates, employees or agents, on the one hand, and any of
the Buyers or any of their affiliates, on the other hand, shall terminate. The Company shall not, and shall cause each of its Subsidiaries
and its and each of their respective officers, directors, affiliates, employees and agents, not to, provide any Buyer with any
material, nonpublic information regarding the Company or any of its Subsidiaries (other than any material, nonpublic information
relating to the Company with respect to the transactions contemplated herein which shall be disclosed in the 8-K Filing) from and
after the date hereof without the express prior written consent of such Buyer. To the extent that the Company delivers any material,
non-public information to a Buyer without such Buyer's consent, the Company hereby covenants and agrees that such Buyer shall not
have any duty of confidentiality to the Company, any of its Subsidiaries or any of their respective officers, directors, affiliates,
employees or agents with respect to, or a duty to the Company, any of its Subsidiaries or any of their respective officers, directors,
affiliates, employees or agents not to trade on the basis of, such material, non-public information. Subject to the foregoing,
neither the Company, its Subsidiaries nor any Buyer shall issue any press releases or any other public statements with respect
to the transactions contemplated hereby; provided, however, that the Company shall be entitled, without the prior approval of any
Buyer, to make any press release or other public disclosure with respect to such transactions (i) in substantial conformity with
the 8-K Filing and (ii) as is required by applicable law and regulations. Except for the Registration Statement required to be
filed pursuant to the Registration Rights Agreement, the Form 8-K Filing and as otherwise required by applicable law and regulations,
without the prior written consent of any applicable Buyer, neither the Company nor any of its Subsidiaries or affiliates shall
disclose the name of such Buyer in any filing, announcement, release or otherwise.

 

(j)Additional
Notes; Variable Securities. So long as any Buyer beneficially owns any Notes, the Company will not issue any Notes other than
to the Buyers as contemplated hereby and the Company shall not issue any other securities that would cause a breach or default
under the Notes. For so long as any Notes remain outstanding, the Company shall not, in any manner, issue or sell any rights, warrants
or options to subscribe for or purchase Common Stock or directly or indirectly convertible into or exchangeable or exercisable
for Common Stock at a price which varies or may vary with the market price of the Common Stock (other than with respect to customary
weighted-average anti-dilution and full-ratchet anti-dilution adjustments), including by way of one or more reset(s) to any fixed
price, unless the conversion, exchange or exercise price of any such security cannot be less than the then applicable Conversion
Price with respect to the Common Stock into which any Note is convertible or the then applicable Exercise Price (as defined in
the Warrants) with respect to the Common Stock into which any Warrant is exercisable. 

 

    	 

    	 

    

 

(k)Corporate
Existence. So long as any Buyer beneficially owns any Securities, the Company shall (i) maintain its corporate existence and
(ii) not be party to any Fundamental Transaction (as defined in the Notes) unless the Company is in compliance with the applicable
provisions governing Fundamental Transactions set forth in the Notes and the Warrants.

 

(l)Reservation
of Shares. So long as any Buyer owns any Securities, the Company shall take all action necessary to at all times have authorized,
and reserved for the purpose of issuance, no less than the Required Reserve Amount. If at any time the number of shares of Common
Stock authorized and reserved for issuance is not sufficient to meet the Required Reserved Amount, the Company will promptly take
all corporate action necessary to authorize and reserve a sufficient number of shares, including, without limitation, calling a
special meeting of stockholders to authorize additional shares to meet the Company's obligations under Section 3(c), in the case
of an insufficient number of authorized shares, obtain stockholder approval of an increase in such authorized number of shares,
and voting the management shares of the Company in favor of an increase in the authorized shares of the Company to ensure that
the number of authorized shares is sufficient to meet the Required Reserved Amount.

 

(m)Conduct
of Business. The business of the Company and its Subsidiaries shall not be conducted in violation of any law, ordinance or
regulation of any governmental entity, except where such violations would not result, either individually or in the aggregate,
in a Material Adverse Effect.

 

(n)Additional
Issuances of Securities.

 

(i)From
the date hereof until the earlier of (x) the time of the registration of all of the Registrable Securities (as defined in the Registration
Rights Agreement) pursuant to and in accordance with the Registration Rights Agreement, which registration remains in effect and
(y) such time as all of the Registrable Securities, if a registration statement is not available for the resale of all of the Registrable
Securities may be sold pursuant to Rule 144, the Company shall not, directly or indirectly, file any registration statement with
the SEC, or file any amendment or supplement thereto, or grant any registration rights to any Person that can be exercised prior
to the earlier of such time as set forth above, other than pursuant to the Registration Rights Agreement and any registration statement
registered on Form S-8 or S-4.

 

(ii)From
the date hereof until the date that ninety (90) days immediately following the Closing Date, other than with respect to Excluded
Securities (as defined in the Notes), the Company will not: (i) directly or indirectly, offer, sell, grant any option to purchase,
or otherwise dispose of (or announce any offer, sale, grant or any option to purchase or other disposition of) any of its or its
Subsidiaries' equity or equity equivalent securities, including without limitation any convertible debt, preferred stock or other
instrument or security that is, at any time during its life and under any circumstances, convertible into or exchangeable or exercisable
for Common Stock or Common Stock Equivalents or (ii) be party to any solicitations, negotiations or discussions with regard to
the foregoing.

 

    	 

    	 

    

 

(o)Public
Information. At any time during the period commencing from the six (6) month anniversary of the Closing Date and ending at
such time that all of the Securities, if a registration statement is not available for the resale of all of the Securities, may
be sold without restriction or limitation pursuant to Rule 144 and without the requirement to be in compliance with Rule 144(c)(1),
if the Company shall (i) fail for any reason to satisfy the requirements of Rule 144(c)(1), including, without limitation, the
failure to satisfy the current public information requirement under Rule 144(c) or (ii) if the Company has ever been an issuer
described in Rule 144(i)(1)(i) or becomes such an issuer in the future, and the Company shall fail to satisfy any condition set
forth in Rule 144(i)(2) (a "Public Information Failure") then, as partial relief for the damages to any holder
of Securities by reason of any such delay in or reduction of its ability to sell the Securities (which remedy shall not be exclusive
of any other remedies available at law or in equity), the Company shall pay to each such holder an amount in cash equal to two
percent (2.0%) of the aggregate purchase price of such holder's Securities on the day of a Public Information Failure and on every
thirtieth day (pro rated for periods totaling less than thirty days) thereafter until the earlier of (i) the date such Public Information
Failure is cured and (ii) such time that such public information is no longer required pursuant to Rule 144. The payments to which
a holder shall be entitled pursuant to this Section 4(o) are referred to herein as "Public Information Failure Payments."
Public Information Failure Payments shall be paid on the earlier of (I) the last day of the calendar month during which
such Public Information Failure Payments are incurred and (II) the third Business Day after the event or failure giving
rise to the Public Information Failure Payments is cured. In the event the Company fails to make Public Information Failure
Payments in a timely manner, such Public Information Failure Payments shall bear interest at the rate of 1.5% per month
(prorated for partial months) until paid in full. Notwithstanding the foregoing, no Public Information Failure Payments shall be
deemed to accrue hereunder at any time Registration Delay Payments (as defined in the Registration Rights Agreement) are accruing
under the Registration Rights Agreement.

 

(p)Notice
of Disqualification Events. The Company will notify the Buyers in writing, prior to the Closing Date of (i) any Disqualification
Event relating to any Issuer Covered Person and (ii) any event that would, with the passage of time, become a Disqualification
Event relating to any Issuer Covered Person.

 

(q)Collateral
Agent. 

 

(i)Each
Buyer hereby (a) appoints AIGH Investment Partners, LLC as the collateral agent hereunder and under the Security Documents (in
such capacity, the "Collateral Agent"), and (b) authorizes the Collateral Agent (and its officers, directors,
employees and agents) to take such action on such Buyer's behalf in accordance with the terms hereof and thereof. The Collateral
Agent shall not have, by reason hereof or pursuant to any Security Documents, a fiduciary relationship in respect of any Buyer.
Neither the Collateral Agent nor any of its officers, directors, employees and agents shall have any liability to any Buyer for
any action taken or omitted to be taken in connection hereof or the Security Documents except to the extent caused by its own gross
negligence or willful misconduct, and each Buyer agrees to defend, protect, indemnify and hold harmless the Collateral Agent and
all of its officers, directors, employees and agents (collectively, the "Collateral Agent Indemnitees")
from and against any losses, damages, liabilities, obligations, penalties, actions, judgments, suits, fees, costs and expenses
(including, without limitation, reasonable attorneys' fees, costs and expenses) incurred by such Collateral Agent Indemnitee, whether
direct, indirect or consequential, arising from or in connection with the performance by such Collateral Agent Indemnitee of the
duties and obligations of Collateral Agent pursuant hereto or any of the Security Documents.

 

    	 

    	 

    

 

(ii)The
Collateral Agent shall be entitled to rely upon any written notices, statements, certificates, orders or other documents or any
telephone message believed by it in good faith to be genuine and correct and to have been signed, sent or made by the proper Person,
and with respect to all matters pertaining to this Agreement or any of the other Transaction Documents and its duties hereunder
or thereunder, upon advice of counsel selected by it.

 

(iii)The
Collateral Agent may resign from the performance of all its functions and duties hereunder and under the Notes and the Security
Documents at any time by giving at least ten (10) Business Days prior written notice to the Company and each holder of the Notes.
Such resignation shall take effect upon the acceptance by a successor Collateral Agent of appointment as provided below. Upon any
such notice of resignation, the holders of a majority of the outstanding principal amount of Notes shall appoint a successor Collateral
Agent. Upon the acceptance of the appointment as Collateral Agent, such successor Collateral Agent shall succeed to and become
vested with all the rights, powers, privileges and duties of the retiring Collateral Agent, and the retiring Collateral Agent shall
be discharged from its duties and obligations under this Agreement, the Notes and the Security Agreement. After any Collateral
Agent's resignation hereunder, the provisions of this Section 4(q) shall inure to its benefit. If a successor Collateral Agent
shall not have been so appointed within said ten (10) Business Day period, the retiring Collateral Agent shall then appoint a successor
Collateral Agent who shall serve until such time, if any, as the holders of a majority of the outstanding principal amount of Notes
appoints a successor Collateral Agent as provided above.

 

(iv)The
Company hereby covenants and agrees to take all actions as promptly as practicable reasonably requested by either the holders of
a majority of the outstanding principal amount of Notes or the Collateral Agent (or its successor), from time to time pursuant
to the terms of this Section 4(q), to secure a successor Collateral Agent satisfactory to such requesting part(y)(ies), in their
sole discretion, including, without limitation, by paying all fees of such successor Collateral Agent, by having the Company agree
to indemnify any successor Collateral Agent and by each of the Company executing a collateral agency agreement or similar agreement
and/or any amendment to the Security Documents reasonably requested or required by the successor Collateral Agent.

 

    	 

    	 

    

 

(v)The
Collateral Agent shall terminate the Security Documents promptly following the date that none of the Notes remain outstanding.

 

No Net Short
Sales 

(s). So
long as the Notes remain outstanding, no Buyer nor any of its affiliates nor any entity managed or controlled by a Buyer (collectively,
the “Restricted Persons” and each of the foregoing is referred to herein as a “Restricted Person”)
shall maintain, in the aggregate, a Net Short Position. For purposes hereof, a “Net Short Position” by a Restricted
Person means a position whereby such Restricted Person has executed one or more sales of Common Stock that is marked as a short
sale (but not including any sale marked “short exempt”) and that is executed at a time when such Restricted Person
has no equivalent offsetting long position in the Common Stock (or is deemed to have a long position hereunder or otherwise in
accordance with Regulation SHO under the 1934 Act); provided, further that no “Short Sale” shall be deemed to exist
as a result of any failure by the Company (or its agents) to deliver Conversion Shares or Warrant Shares, respectively, upon conversion
of the Notes or exercise of the Warrants, respectively, to any Restricted Person exercising such Notes or Warrants, as applicable.
For purposes of determining whether a Restricted Person has an equivalent offsetting long position in the Common Stock, such Restricted
Person shall be deemed to hold “long” all Common Stock that is either (i) then owned by such Restricted Person, if
any, (ii) then issuable to such Restricted Person as Conversion Shares pursuant to the terms of the Notes then held by such Restricted
Person, if any, (without regard to any limitations on conversion set forth in the Notes and giving effect to any conversion price
adjustments that would take effect given only the passage of time), (iii) that may be issued as Interest Shares pursuant to the
terms of the Notes to such Restricted Person or (iv) then issuable to such Restricted Person upon exercise of the Warrants then
held by such Restricted Person, if any, (without regard to any limitation on exercise set forth in the Warrants and giving effect
to any exercise price adjustments that would take effect given only the passage of time). Notwithstanding the foregoing, nothing
contained herein (i) shall (without implication that the contrary would otherwise be true) prohibit any Restricted Person
from selling “long” (as defined under Rule 200 promulgated under Regulation SHO under the 1934 Act) the Securities
or any other Common Stock then owned by such Restricted Person or (ii) shall constitute a covenant, or preclude any actions, with
respect to the identification of the availability of, or securing of, available shares to borrow in order to effect short sales
or similar transactions.

 

5.REGISTER;
TRANSFER AGENT INSTRUCTIONS.

 

(a)Register.
The Company shall maintain at its principal executive offices (or such other office or agency of the Company as it may designate
by notice to each holder of Securities), a register for the Notes and the Warrants in which the Company shall record the name and
address of the Person in whose name the Notes and the Warrants have been issued (including the name and address of each
transferee), the principal amount of Notes held by such Person, the number of Conversion Shares issuable pursuant to the terms
of the Notes and the number of Warrant Shares issuable upon exercise of the Warrants held by such Person. The Company shall keep
the register open and available at all times during regular business hours for inspection at reasonable times by any Buyer or its
legal representatives.

 

    	 

    	 

    

 

(b)Transfer
Agent Instructions. The Company shall issue irrevocable instructions to its transfer agent, and any subsequent transfer agent,
in the form of Exhibit F attached hereto (the "Irrevocable Transfer Agent Instructions") to issue certificates
or, to the extent permitted by applicable securities laws, credit shares to the applicable balance accounts at DTC, registered
in the name of each Buyer or its respective nominee(s), for the Conversion Shares and the Warrant Shares issued at the Closing
or upon conversion of the Notes or exercise of the Warrants in such amounts as specified from time to time by each Buyer to the
Company upon conversion of the Notes or exercise of the Warrants. The Company warrants that no instruction other than the Irrevocable
Transfer Agent Instructions referred to in this Section 5(b), and stop transfer instructions to give effect to Section 2(f) hereof,
will be given by the Company to its transfer agent, and that the Securities shall otherwise be freely transferable on the books
and records of the Company as and to the extent provided in this Agreement and the other Transaction Documents. If a Buyer effects
a sale, assignment or transfer of the Securities in accordance with Section 2(f), the Company shall permit the transfer and shall
promptly instruct its transfer agent to issue one or more certificates or, to the extent permitted by applicable securities laws,
credit shares to the applicable balance accounts at DTC in such name and in such denominations as specified by such Buyer to effect
such sale, transfer or assignment. In the event that such sale, assignment or transfer involves the Conversion Shares or the Warrant
Shares sold, assigned or transferred pursuant to an effective registration statement or pursuant to Rule 144, the transfer agent
shall issue such Securities to the Buyer, assignee or transferee, as the case may be, without any restrictive legend. The Company
acknowledges that a breach by it of its obligations hereunder will cause irreparable harm to a Buyer. Accordingly, the Company
acknowledges that the remedy at law for a breach of its obligations under this Section 5(b) will be inadequate and agrees, in the
event of a breach or threatened breach by the Company of the provisions of this Section 5(b), that a Buyer shall be entitled, in
addition to all other available remedies, to an order and/or injunction restraining any breach and requiring immediate issuance
and transfer, without the necessity of showing economic loss and without any bond or other security being required.

 

6.CONDITIONS
TO THE COMPANY'S OBLIGATION TO SELL.

 

The obligation of the
Company hereunder to issue and sell the Notes and the related Warrants to each Buyer at the Closing is subject to the satisfaction,
at or before the Closing Date, of each of the following conditions, provided that these conditions are for the Company's sole benefit
and may be waived by the Company at any time in its sole discretion by providing each Buyer with prior written notice thereof:

 

(i)Such
Buyer shall have executed each of the Transaction Documents to which it is a party and delivered the same to the Company.

 

(ii)Such
Buyer shall have delivered the Purchase Price contemplated by Section 1(c) hereof for the Notes and the related Warrants being
purchased by such Buyer at the Closing pursuant to Section 1(d) hereof by wire transfer of immediately available funds pursuant
to the wire instructions provided by the Company.

 

(iii)The
representations and warranties of such Buyer shall be true and correct in all material respects (except for those representations
and warranties that are qualified by materiality or Material Adverse Effect, which are accurate in all respects) as of the date
when made and as of the Closing Date as though made at that time (except for representations and warranties that speak as of a
specific date which shall be true and correct as of such specified date), and such Buyer shall have performed, satisfied and complied
in all material respects with the covenants, agreements and conditions required by this Agreement to be performed, satisfied or
complied with by such Buyer at or prior to the Closing Date.

 

    	 

    	 

    

 

7.CONDITIONS
TO EACH BUYER'S OBLIGATION TO PURCHASE.

 

The obligation of each
Buyer hereunder to purchase the Notes and the related Warrants at the Closing is subject to the satisfaction, at or before
the Closing Date, of each of the following conditions, provided that these conditions are for each Buyer's sole benefit and may
be waived by such Buyer at any time in its sole discretion by providing the Company with prior written notice thereof:

 

(i)The
Company and each of its Subsidiaries shall have duly executed and delivered to such Buyer each of the following documents to which
it is a party: (A) each of the Transaction Documents, (B) the Notes (allocated in such principal amounts as such Buyer shall request),
being purchased by such Buyer at the Closing pursuant to this Agreement and (C) the related Warrants (allocated in such amounts
as such Buyer shall request) being purchased by such Buyer at the Closing pursuant to this Agreement.

 

(ii)Such
Buyer and the Placement Agent shall have received the opinion of Greenberg Traurig, LLP, the Company's outside counsel, dated as
of the Closing Date, in the form acceptable to such Buyer.

 

(iii)The
Company shall have delivered to such Buyer a copy of the Irrevocable Transfer Agent Instructions, in the form of Exhibit F
attached hereto, which instructions shall have been delivered to and acknowledged in writing by the Company's transfer agent.

 

(iv)The
Company shall have delivered to such Buyer a certificate evidencing the formation and good standing of the Company and each of
its Subsidiaries in such entity's jurisdiction of formation issued by the Secretary of State (or comparable office) of such jurisdiction,
as of a date within ten (10) Trading Days of the Closing Date.

 

(v)The
Company shall have delivered to such Buyer a certificate evidencing the Company's and each of its Subsidiaries' qualification as
a foreign corporation and good standing issued by the Secretary of State (or comparable office) of each jurisdiction in which the
Company and its Subsidiaries conduct business, as of a date within ten (10) Trading Days of the Closing Date.

 

(vi)The
Company shall have delivered to such Buyer a certified copy of the Articles of Incorporation of the Company as certified by the
Secretary of State (or comparable office) of the jurisdiction of formation of the Company within ten (10) Trading Days of the Closing
Date.

 

    	 

    	 

    

 

(vii)The
Company shall have delivered to such Buyer a certificate, executed by the Secretary of the Company and dated as of the Closing
Date, as to (i) the resolutions consistent with Section 3(b) as adopted by the Company's and each of its Subsidiaries' Board of
Directors in a form reasonably acceptable to such Buyer, (ii) the Articles of Incorporation of the Company and each of its Subsidiaries
and (iii) the Bylaws of the Company and each of its Subsidiaries, each as in effect at the Closing, in the form attached hereto
as Exhibit G.

 

(viii)The
representations and warranties of the Company shall be true and correct in all material respects (except for those representations
and warranties that are qualified by materiality or Material Adverse Effect, which are accurate in all respects) as of the date
when made and as of the Closing Date as though made at that time (except for representations and warranties that speak as of a
specific date which shall be true and correct as of such specified date) and the Company shall have performed, satisfied and complied
in all material respects with the covenants, agreements and conditions required by the Transaction Documents to be performed, satisfied
or complied with by the Company at or prior to the Closing Date. Such Buyer shall have received a certificate, executed by the
Chief Executive Officer of the Company, dated as of the Closing Date, to the foregoing effect in the form attached hereto as Exhibit
H.

 

(ix)The
Company shall have delivered to such Buyer a letter from the Company's transfer agent certifying the number of shares of Common
Stock outstanding as of a date within ten (10) Trading Days of the Closing Date.

 

(x)The
Common Stock (I) shall be designated for quotation on the Principal Market and (II) shall not have been suspended or halted from
trading on the Principal Market, as of the Closing Date, by the SEC or FINRA nor shall either (A) suspension or halting from trading
on the Principal Market by the SEC or FINRA have been threatened, as of the Closing Date, in writing by the SEC or FINRA or (B)
removal from quotation on the Principal Market have been threatened, as of the Closing Date, in writing by the Principal Market
due to the Common Stock falling below the minimum listing maintenance requirements of the Principal Market.

 

(xi)The
Company shall have obtained all governmental, regulatory or third party consents and approvals, if any, necessary for the sale
of the Notes and Warrants.

 

(xii)Each
of the Company's U.S. Subsidiaries shall have executed and delivered to such Buyer the Guaranty Agreement.

 

(xiii)The
Collateral Agent shall have received certified copies of request for copies of information on Form UCC-11, listing all effective
financing statements which name as debtor the Company or any of its Subsidiaries and which are filed in such office or offices
as may be necessary or, in the opinion of the Collateral Agent, desirable to perfect the security interests purported to be created
by the Security Agreement, together with copies of such financing statements, none of which, except as otherwise agreed in writing
by the Collateral Agent, shall cover any of the Collateral, and the results of searches for any lien recorded with the USPTO or
U.S. copyright office, any tax lien and judgment lien filed against such person or its property, which results, except as otherwise
agreed to in writing by the Collateral Agent, shall not show any such liens.

 

    	 

    	 

    

 

(xiv)The
Collateral Agent shall have received the Security Agreement, duly executed by the Company and each of its U.S. Subsidiaries, together
with (A) the original stock certificates representing all of the equity interests and all promissory notes required to be pledged
thereunder, accompanied by undated stock powers and allonges executed in blank and other proper instruments of transfer and (B)
any copyright, patent and trademark agreements required by the terms of the Security Agreement.

 

(xv)The
Company shall have delivered to such Buyer such other documents relating to the transactions contemplated by this Agreement as
such Buyer or its counsel may reasonably request.

 

8.TERMINATION.
In the event that the Closing shall not have occurred with respect to a Buyer on or before ten (10) Trading Days from the date
hereof due to the Company's or such Buyer's failure to satisfy the conditions set forth in Sections 6 and 7 above (and the nonbreaching
party's failure to waive such unsatisfied condition(s)), the nonbreaching party shall have the option to terminate this Agreement
with respect to such breaching party at the close of business on such date by delivering a written notice to that effect to each
other party to this Agreement and without liability of any party to any other party.

 

9.MISCELLANEOUS.

 

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

 

    	 

    	 

    

 

(b)Counterparts.
This Agreement may be executed in two or more identical counterparts, all of which shall be considered one and the same agreement
and shall become effective when counterparts have been signed by each party and delivered to the other party; provided that a facsimile
or .pdf signature shall be considered due execution and shall be binding upon the signatory thereto with the same force and effect
as if the signature were an original, not a facsimile signature or .pdf signature. Delivery of a counterpart signature hereto by
facsimile or email/.pdf transmission shall be deemed valid delivery thereof.

 

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

 

(d)Severability.
If any provision of this Agreement is prohibited by law or otherwise determined to be invalid or unenforceable by a court of competent
jurisdiction, the provision that would otherwise be prohibited, invalid or unenforceable shall be deemed amended to apply to the
broadest extent that it would be valid and enforceable, and the invalidity or unenforceability of such provision shall not affect
the validity of the remaining provisions of this Agreement so long as this Agreement as so modified continues to express, without
material change, the original intentions of the parties as to the subject matter hereof and the prohibited nature, invalidity or
unenforceability of the provision(s) in question does not substantially impair the respective expectations or reciprocal obligations
of the parties or the practical realization of the benefits that would otherwise be conferred upon the parties. The parties will
endeavor in good faith negotiations to replace the prohibited, invalid or unenforceable provision(s) with a valid provision(s),
the effect of which comes as close as possible to that of the prohibited, invalid or unenforceable provision(s).

 

(e)Entire
Agreement; Amendments. This Agreement and the other Transaction Documents supersede all other prior oral or written agreements
between the Buyers, the Company, their affiliates and Persons acting on their behalf with respect to the matters discussed herein,
and this Agreement, the other Transaction Documents and the instruments referenced herein and therein contain the entire understanding
of the parties with respect to the matters covered herein and therein and, except as specifically set forth herein or therein,
neither the Company nor any Buyer makes any representation, warranty, covenant or undertaking with respect to such matters. Provisions
of this Agreement may be amended and the observance thereof may be waived (either generally or in a particular instance and either
retroactively or prospectively), only with the written consent of the Company and the holders of at least a majority of the aggregate
number of Registrable Securities issued or issuable under the Notes and Warrants (the "Required Holders"); provided
that any such amendment or waiver that complies with the foregoing but that disproportionately, materially and adversely affects
the rights and obligations of any Buyer relative to the comparable rights and obligations of the other Buyers shall require the
prior written consent of such adversely affected Buyer; provided, further, that (i) the provisions of Section 4(q)
cannot be amended without the additional prior written approval of the Collateral Agent or its successor and (ii) any such amendment
or waiver that materially and adversely affects the rights of the Placement Agent shall require the prior written consent of the
Placement Agent. No provisions hereto may be waived other than by an instrument in writing signed by the party against whom enforcement
is sought. Any amendment or waiver effected in accordance with this Section 9(e) shall be binding upon each Buyer and holder of
Securities and the Company. No such amendment shall be effective to the extent that it applies to less than all of the Buyers or
holders of Securities. No consideration shall be offered or paid to any Person to amend or consent to a waiver or modification
of any provision of any of the Transaction Documents unless the same consideration (other than the reimbursement of legal fees)
also is offered to all of the parties to the Transaction Documents, holders of Notes or holders of the Warrants, as the case may
be. The Company has not, directly or indirectly, made any agreements with any Buyers relating to the terms or conditions of the
transactions contemplated by the Transaction Documents except as set forth in the Transaction Documents. Without limiting the foregoing,
the Company confirms that, except as set forth in this Agreement, no Buyer has made any commitment or promise or has any other
obligation to provide any financing to the Company or otherwise.

 

    	 

    	 

    

 

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

 

If to the Company:

 

	Enerpulse Technologies, Inc.
	2451 Alamo Ave. NE,
	Albuquerque, New Mexico 87106
	Telephone:	(505) 842-5201
	Facsimile:	(505) 213-0013
	Attention:	Bryan Templeton,
		Chief Financial Officer
	Email:	btempleton@enerpulse.com

 

With a copy to:

 

	Greenberg Traurig, LLP
	1201 K. Street,	 
	Suite 2100	 
	Sacramento, CA 95814
	Telephone:	(916) 442-1111
	Facsimile:	(916) 448-1709
	Attention:	Mark C. Lee, Esq.
	E-mail:	leema@gtlaw.com

 

    	 

    	 

    

 

If to the Placement Agent:

 

	ROTH Capital Partners, LLC
	730 Fifth Avenue	 
	New York, New York 10019
	Telephone: 	(646) 338-1905
	Attention: Michael Chill
	E-mail: mchill@roth.com

 

With a copy (for informational purposes only) to:

 

	Schulte Roth & Zabel LLP
	919 Third Avenue	 
	New York, New York  10022
	Telephone:	(212) 756-2000
	Facsimile:	(212) 593-5955
	Attention:	Eleazer N. Klein, Esq.
	E-mail:	eleazer.klein@srz.com

 

If to the Transfer Agent:

 

Securities Transfer Corporation

2591 Dallas Parkway, Suite 102

Frisco, Texas 75034

Telephone: (469) 633-0101

Facsimile: (469) 633-0088

Attention: Christina Shelton, Original Issuance
Department

E-mail: shelton@stctransfer.com

 

 

If to a Buyer, to its address, facsimile
number and e-mail address set forth on the Schedule of Buyers, with copies to such Buyer's representatives as set forth on the
Schedule of Buyers, or to such other address, facsimile number and/or e-mail address and/or to the attention of such other Person
as the recipient party has specified by written notice given to each other party at least one (1) Business day prior to the effectiveness
of such change. Written confirmation of receipt (A) given by the recipient of such notice, consent, waiver or other communication,
(B) mechanically or electronically generated by the sender's facsimile machine or e-mail containing the time, date, recipient facsimile
number and an image of the first page of such transmission or (C) provided by an overnight courier service shall be rebuttable
evidence of personal service, receipt by facsimile or receipt from an overnight courier service in accordance with clause (i),
(ii) or (iii) above, respectively.

 

(g)Successors
and Assigns. This Agreement shall be binding upon and inure to the benefit of the parties and their respective successors and
assigns, including any purchasers of the Notes or the Warrants. The Company shall not assign this Agreement or any rights or obligations
hereunder without the prior written consent of the Required Holders, including by way of a Fundamental Transaction (unless the
Company is in compliance with the applicable provisions governing Fundamental Transactions set forth in the Notes and the Warrants).
A Buyer may assign some or all of its rights hereunder in connection with any assignment of restricted Notes and/or restricted
Warrants of such Buyer without the consent of the Company, in which event such assignee shall be deemed to be a Buyer hereunder
with respect to such assigned rights related to such restricted Notes and/or restricted Warrants assigned.

 

    	 

    	 

    

 

(h)No
Third Party Beneficiaries. This Agreement is intended for the benefit of the parties hereto and their respective permitted
successors and assigns, and is not for the benefit of, nor may any provision hereof be enforced by, any other Person, except that
(i) each Indemnitee shall have the right to enforce the obligations of the Company with respect to Section 9(m) and (ii) the Placement
Agent shall be a third party beneficiary of this Section 9(h) and Sections 1(e), 2(e), 2(k), 2(l), 2(m), 3(g), 4(g), 7(ii), 9(i)
and 9(j).

 

(i)Reliance
by the Placement Agent. Each party agrees and acknowledges that the Placement Agent may rely on the representations, warranties,
agreements and covenants of the Company contained in this Agreement and may rely on the representations and warranties of the respective
Buyers contained in this Agreement as if such representations, warranties, agreements, and covenants, as applicable, were made
directly to the Placement Agent. The parties further agree that the Placement Agent may rely on or, if the Placement Agent so requests,
be specifically named as an addressee of, the legal opinions to be delivered pursuant to Section 7(ii) of this Agreement.

 

(j)Exculpation of Placement
Agent. Each party hereto agrees for the express benefit of each of the Placement Agent, their affiliates and representatives
that:

 

(i)Neither
the Placement Agent nor any of its affiliates or any of its representatives (1) has any duties or obligations other than those
specifically set forth herein or in the Engagement Letter; (2) shall be liable for any improper payment made in accordance with
the information provided by the Company; (3) makes any representation or warranty, or has any responsibilities as to the validity,
accuracy, value or genuineness of any information, certificates or documentation delivered by or on behalf of the Company pursuant
to this Agreement or the Transaction Documents or in connection with any of the transactions contemplated hereby; or (4) shall
be liable (x) for any action taken, suffered or omitted by any of them in good faith and reasonably believed to be authorized or
within the discretion or rights or powers conferred upon it by this Agreement or any Transaction Document or (y) for anything which
any of them may do or refrain from doing in connection with this Agreement or any Transaction Document, except for such party's
own gross negligence, willful misconduct or bad faith.

 

(ii)The
Placement Agent, and its affiliates and representatives shall be entitled to (1) rely on, and shall be protected in acting upon,
any certificate, instrument, opinion, notice, letter or any other document or security delivered to any of them by or on behalf
of the Company, and (2) be indemnified by the Company for acting as Placement Agent hereunder pursuant the indemnification provisions
set forth in the Engagement Letter.

 

    	 

    	 

    

 

(k)Survival.
Unless this Agreement is terminated under Section 8, the representations and warranties of the Company and the Buyers contained
in Sections 2 and 3, and the agreements and covenants set forth in Sections 4, 5 and 9 shall survive the Closing. Each Buyer shall
be responsible only for its own representations, warranties, agreements and covenants hereunder.

 

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

 

(m)Indemnification.
In consideration of each Buyer's execution and delivery of the Transaction Documents and acquiring the Securities thereunder and
in addition to all of the Company's other obligations under the Transaction Documents, the Company shall defend, protect, indemnify
and hold harmless each Buyer and each other holder of the Securities and all of their stockholders, partners, members, officers,
directors, employees and direct or indirect investors and any of the foregoing Persons' agents or other representatives (including,
without limitation, those retained in connection with the transactions contemplated by this Agreement) (collectively, the "Indemnitees")
from and against any and all actions, causes of action, suits, claims, losses, costs, penalties, fees, liabilities and damages,
and expenses in connection therewith (irrespective of whether any such Indemnitee is a party to the action for which indemnification
hereunder is sought), and including reasonable and documented attorneys' fees and disbursements (the "Indemnified Liabilities"),
incurred by any Indemnitee as a result of, or arising out of, or relating to (a) any misrepresentation or breach of any representation
or warranty made by the Company in the Transaction Documents or any other certificate, instrument or document contemplated hereby
or thereby, (b) any breach of any covenant, agreement or obligation of the Company contained in the Transaction Documents or any
other certificate, instrument or document contemplated hereby or thereby or (c) any cause of action, suit or claim brought or made
against such Indemnitee by a third party (including for these purposes a derivative action brought on behalf of the Company) and
arising out of or resulting from (i) the execution, delivery, performance or enforcement of the Transaction Documents or any other
certificate, instrument or document contemplated hereby or thereby, (ii) any transaction financed or to be financed in whole or
in part, directly or indirectly, with the proceeds of the issuance of the Securities or (iii) the status of such Buyer or holder
of the Securities as an investor in the Company pursuant to the transactions contemplated by the Transaction Documents. To the
extent that the foregoing undertaking by the Company may be unenforceable for any reason, the Company shall make the maximum contribution
to the payment and satisfaction of each of the Indemnified Liabilities that is permissible under applicable law. Except as otherwise
set forth herein, the mechanics and procedures with respect to the rights and obligations under this Section 9(m) shall be the
same as those set forth in Section 6 of the Registration Rights Agreement.

 

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

 

    	 

    	 

    

 

(o)Remedies.
Each Buyer and each holder of the Securities shall have all rights and remedies set forth in the Transaction Documents and all
rights and remedies which such holders have been granted at any time under any other agreement or contract and all of the rights
which such holders have under any law. Any Person having any rights under any provision of this Agreement shall be entitled to
enforce such rights specifically (without posting a bond or other security), to recover damages by reason of any breach of any
provision of this Agreement and to exercise all other rights granted by law. Furthermore, the Company recognizes that in the event
that it fails to perform, observe, or discharge any or all of its obligations under the Transaction Documents, any remedy at law
may prove to be inadequate relief to the Buyers. The Company therefore agrees that the Buyers shall be entitled to seek temporary
and permanent injunctive relief in any such case without the necessity of proving actual damages and without posting a bond or
other security.

 

(p)Rescission
and Withdrawal Right. Notwithstanding anything to the contrary contained in (and without limiting any similar provisions of)
the Transaction Documents, whenever any Buyer exercises a right, election, demand or option under a Transaction Document and the
Company does not timely perform its related obligations within the periods therein provided, then such Buyer may rescind or withdraw,
in its sole discretion from time to time upon written notice to the Company, any relevant notice, demand or election in whole or
in part without prejudice to its future actions and rights.

 

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

 

(r)Independent
Nature of Buyers' Obligations and Rights. The obligations of each Buyer under any Transaction Document are several and not
joint with the obligations of any other Buyer, and no Buyer shall be responsible in any way for the performance of the obligations
of any other Buyer under any Transaction Document. Nothing contained herein or in any other Transaction Document, and no action
taken by any Buyer pursuant hereto or thereto, shall be deemed to constitute the Buyers as, and the Company acknowledges that the
Buyers do not so constitute, a partnership, an association, a joint venture or any other kind of entity, or create a presumption
that the Buyers are in any way acting in concert or as a group, and the Company shall not assert any such claim with respect to
such obligations or the transactions contemplated by the Transaction Documents and the Company acknowledges that the Buyers are
not acting in concert or as a group with respect to such obligations or the transactions contemplated by the Transaction Documents.
The Company acknowledges and each Buyer confirms that it has independently participated in the negotiation of the transaction contemplated
hereby with the advice of its own counsel and advisors. Each Buyer shall be entitled to independently protect and enforce its rights,
including, without limitation, the rights arising out of this Agreement or out of any other Transaction Documents, and it shall
not be necessary for any other Buyer to be joined as an additional party in any proceeding for such purpose.

 

[Signature Page Follows]

 

 

    	 

    	 

    

 

IN WITNESS WHEREOF,
each Buyer and the Company have caused their respective signature page to this Securities Purchase Agreement to be duly executed
as of the date first written above.

 

	
         

        
	COMPANY:
	 	 
	 	ENERPULSE TECHNOLOGIES, INC.
	 	 	 
	 	 	 
	 	By:  	

	 	 	Name:
	 	 	Title:

 

 

    	 

    	 

    

 

IN WITNESS WHEREOF,
each Buyer and the Company have caused their respective signature page to this Securities Purchase Agreement to be duly executed
as of the date first written above.

 

	 	BUYERS:
	 	 
	 	
        [___________]

         

	 	 
	 	 	 
	 	 	 
	 	By:  	

	 	 	Name:  
	 	 	Title:  

 

    	 

    	 

    

 

SCHEDULE OF BUYERS

 

	(1)	
         

        (2)
	
         

        (3)
	
         

        (4)
	
         

        (5)
	
         

        (6)

	
        Buyer
	
        Address
and

Facsimile Number
	
        Aggregate

Principal

Amount of Notes
	
        Number
of

Warrant Shares
	
        Purchase
Price
	
        Legal
Representative's Address and Facsimile Number

	[Buyers]	
         

        [Address]

        Attention: [ ]

        Facsimile: [ ]

        Telephone: [ ]

        Residence: [ ]

        E-mail: [ ]

        

        
	$[   ]	
        

        [   ]
	
        

        $[   ]
	
         

         

 

    	 

    	 

    

 

EXHIBITS

 

	Exhibit A	Form of Notes
	Exhibit B	Form of Warrants
	Exhibit C	Form of Registration Rights Agreement
	Exhibit D	Form of Guaranty Agreement
	Exhibit E	Form of Security Agreement
	Exhibit F	Form of Irrevocable Transfer Agent Instructions
	Exhibit G	Form of Secretary's Certificate
	Exhibit H	Form of Officer's Certificate

 

SCHEDULES

 

	Schedule 2(b)	 Non-Accredited Buyers

	Schedule 3(a)	Subsidiaries
	Schedule 3(d)	Conflicts
	Schedule 3(k)	SEC Documents
	Schedule 3(m)	Undisclosed Events, Liabilities, Developments or Circumstances
	Schedule 3(p)	Sarbanes-Oxley Act
	Schedule 3(q)	Transactions with Affiliates
	Schedule 3(r)	Equity Capitalization
	Schedule 3(s)	Indebtedness and Other Contracts
	Schedule 3(x) 	Intellectual Property Rights
	Schedule 3(cc)	Internal Accounting and Disclosure Controls
	Schedule 3(ee)	Ranking of Notes

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00240-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00240-of-00352.parquet"}]]