Document:

SECURITIES PURCHASE AGREEMENT

 

This Securities Purchase
Agreement (this “Agreement”) is dated as of February [  ], 2014, between Cytosorbents Corporation, a Nevada corporation
(the “Company”) and each purchaser identified on the signature pages hereto (each, including its successors
and assigns, a “Purchaser” and collectively the “Purchasers”).

 

WHEREAS, subject to
the terms and conditions set forth in this Agreement and pursuant to an effective registration statement under the Securities Act
of 1933, as amended (the “Securities Act”), the Company desires to issue and sell to each Purchaser, and each
Purchaser, severally and not jointly, desires to purchase from the Company, securities of the Company as more fully described in
this Agreement.

 

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

 

ARTICLE I.

DEFINITIONS

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

“Closing Statement” means
the Closing Statement in the form on Annex A attached hereto.

 

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

 

“Common Stock”
means the common stock of the Company, par value $0.001 per share, and any other class of securities into which such securities
may hereafter be reclassified or changed.

 

“Common Stock
Equivalents” means any securities of the Company or the Subsidiaries which would entitle the holder thereof to acquire
at any time Common Stock, including, without limitation, any debt, preferred stock, right, option, warrant or other instrument
that is at any time convertible into or exercisable or exchangeable for, or otherwise entitles the holder thereof to receive, Common
Stock.

 

“Company Counsel”
means Szaferman Lakind Blumstein & Blader, PC, with offices located at 101 Grovers Mill Road, #200, Lawrenceville, New Jersey
08648.

 

    	 

    	 

    

 

“Greenberg”
means Greenberg Traurig, with offices located at One International Place, Boston, Massachusetts 02110.

 

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

 

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

 

“Exempt Issuance”
means the issuance of (a) shares of Common Stock or options to employees, officers or directors of the Company pursuant to any
stock or option plan duly adopted for such purpose, by a majority of the non-employee members of the Board of Directors or a majority
of the members of a committee of non-employee directors established for such purpose, (b) securities upon the exercise or exchange
of or conversion of any Securities issued hereunder and/or other securities exercisable or exchangeable for or convertible into
shares of Common Stock issued and outstanding on the date of this Agreement, provided that such securities have not been amended
since the date of this Agreement to increase the number of such securities or to decrease the exercise price, exchange price or
conversion price of such securities, and (c) securities issued 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 equityholders
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 primarily for the purpose of raising capital or to an
entity whose primary business is investing in securities.

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

“Per Share
Purchase Price” equals $______, subject to adjustment for reverse and forward stock splits, stock dividends, stock combinations
and other similar transactions of the Common Stock that occur after the date of this Agreement.

 

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

 

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

 

“Prospectus”
means the final prospectus filed for the Registration Statement.

 

“Prospectus
Supplement” means the supplement to the Prospectus complying with Rule 430A of the Securities Act that is filed with
the Commission and delivered by the Company to each Purchaser at the Closing.

 

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

 

    	 

    	 

    

 

“Registration
Statement” means the effective registration statement with Commission file No. 333-193053 which registers the sale of
the Shares, the Warrants and the Warrant Shares to the Purchasers.

  

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

 

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

 

“Rule 424”
means Rule 424 promulgated by the Commission pursuant to the Securities Act, as such Rule may be amended or interpreted from time
to time, or any similar rule or regulation hereafter adopted by the Commission having substantially the same purpose and effect
as such Rule.

 

“Rule 430A”
means Rule 430A promulgated by the Commission pursuant to the Securities Act, as such Rule may be amended or interpreted from time
to time, or any similar rule or regulation hereafter adopted by the Commission having substantially the same purpose and effect
as such Rule.

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

“Transfer
Agent” means American Stock Transfer & Trust Company, LLC, with a corporate address of 6201 15th Avenue,
Brooklyn, New York 11219 and any successor transfer agent of the Company.

 

“Warrants”
means, collectively, the Common Stock purchase warrants delivered to the Purchasers at the Closing in accordance with Section 2.2(a)
hereof, which Warrants shall be exercisable immediately and have a term of exercise equal to five (5) years, in the form of Exhibit
A attached hereto.

 

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

 

    	 

    	 

    

 

ARTICLE II.

PURCHASE AND SALE

 

2.1        
 Closing.  On the Closing Date, upon the terms and subject to the conditions set forth herein, substantially
concurrent with the execution and delivery of this Agreement by the parties hereto, the Company agrees to sell, and the Purchasers,
severally and not jointly,  agree to purchase, up to an aggregate of $8,500,000 of Shares and Warrants.  Each
Purchaser shall deliver to the Company, via wire transfer or a certified check, immediately available funds equal to such Purchaser’s
Subscription Amount as set forth on the signature page hereto executed by such Purchaser and the Company shall deliver to each
Purchaser its respective Shares and a Warrant as determined pursuant to Section 2.2(a), and the Company and each Purchaser shall
deliver the other items set forth in Section 2.2 deliverable at the Closing.  Upon satisfaction of the covenants and
conditions set forth in Sections 2.2 and 2.3, the Closing shall occur at the offices of Company Counsel or such other location
as the parties shall mutually agree.

 

2.2        
 Deliveries.

 

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

 

(i)   this Agreement duly executed by the Company;

   

(ii)   a copy of the irrevocable
instructions to the Transfer Agent instructing the Transfer Agent to deliver on an expedited basis via The Depository Trust Company
Deposit or Withdrawal at Custodian system (“DWAC”) Shares equal to such Purchaser’s Subscription Amount
divided by the Per Share Purchase Price, registered in the name of such Purchaser;

 

(iv)   a Warrant registered
in the name of such Purchaser to purchase up to a number of shares of Common Stock equal to 50% of such Purchaser’s Shares,
with an exercise price equal to $_____, subject to adjustment therein (such Warrant certificate may be delivered within three
Trading Days of the Closing Date); and

 

(v)   the Prospectus and Prospectus
Supplement (which may be delivered in accordance with Rule 172 under the Securities Act).

 

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

 

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

 

(ii)   such Purchaser’s
Subscription Amount by wire transfer to the account specified in writing by the Company.

 

2.3        
 Closing
Conditions.

 

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

 

(i)   the accuracy in all material
respects on the Closing Date of the representations and warranties of the Purchasers contained herein (unless as of a specific
date therein in which case they shall be accurate as of such date);

 

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

 

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

 

    	 

    	 

    

 

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

 

(i)   the accuracy in all material
respects when made and on the Closing Date of the representations and warranties of the Company contained herein (unless as of
a specific date therein);

 

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

 

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

 

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

 

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

 

ARTICLE III.

REPRESENTATIONS AND WARRANTIES

 

3.1        
 Representations
and Warranties of the Company.  Except as set forth in the Prospectus, Prospectus Supplement or SEC Reports, which
Prospectus, Prospectus Supplement or SEC Reports shall be deemed a part hereof and shall qualify any representation or otherwise
made herein, the Company hereby makes the following representations and warranties to each Purchaser:

 

(a)       
Subsidiaries.  All of the direct and indirect subsidiaries of the Company are set forth in the SEC Reports.  The
Company owns, directly or indirectly, all of the capital stock or other equity interests of each Subsidiary free and clear of any
Liens, and all of the issued and outstanding shares of capital stock of each Subsidiary are validly issued and are fully paid,
non-assessable and free of preemptive and similar rights to subscribe for or purchase securities.  If the Company has
no subsidiaries, all other references to the Subsidiaries or any of them in the Transaction Documents shall be disregarded.

 

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

 

    	 

    	 

    

 

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

 

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

 

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

 

(f)         
Issuance of the Securities; Registration.  The Securities are duly authorized and, when issued and paid for in
accordance with the applicable Transaction Documents, will be duly and validly issued, fully paid and nonassessable, free and clear
of all Liens imposed by the Company.  The Warrant Shares, when issued in accordance with the terms of the Warrants, will
be validly issued, fully paid and nonassessable, free and clear of all Liens imposed by the Company.  The Company has
reserved from its duly authorized capital stock the maximum number of shares of Common Stock issuable pursuant to this Agreement
and the Warrants. The Company has prepared and filed the Registration Statement in conformity with the requirements of the Securities
Act, which became effective on February [ ], 2014 (the “Effective Date”), including the Prospectus, and such
amendments and supplements thereto as may have been required to the date of this Agreement.  The Registration Statement
is effective under the Securities Act and no stop order preventing or suspending the effectiveness of the Registration Statement
or suspending or preventing the use of the Prospectus has been issued by the Commission and no proceedings for that purpose have
been instituted or, to the knowledge of the Company, are threatened by the Commission.  The Company, if required by the
rules and regulations of the Commission, proposes to file the Prospectus, with the Commission pursuant to Rule 424(b) or Rule 430A.  At
the time the Registration Statement and any amendments thereto became effective, at the date of this Agreement and at the Closing
Date, the Registration Statement and any amendments thereto conformed and will conform in all material respects to the requirements
of the Securities Act and did not and will not contain any untrue statement of a material fact or omit to state any material fact
required to be stated therein or necessary to make the statements therein not misleading; and the Prospectus and any amendments
or supplements thereto, at time the Prospectus or any amendment or supplement thereto was issued and at the Closing Date, conformed
and will conform in all material respects to the requirements of the Securities Act and did not and will not contain an untrue
statement of a material fact or omit to state a material fact necessary in order to make the statements therein, in light of the
circumstances under which they were made, not misleading.

 

    	 

    	 

    

 

(g)        
Capitalization.  The capitalization of the Company is as set forth in the SEC Reports.  The Company
has not issued any capital stock since its most recently filed periodic report under the Exchange Act, other than pursuant to the
exercise of employee stock options under the Company’s stock option plans, the issuance of shares of Common Stock to employees
pursuant to the Company’s employee stock purchase plans and pursuant to the conversion and/or exercise of Common Stock Equivalents
outstanding as of the date of the most recently filed periodic report under the Exchange Act.  No Person has any right
of first refusal, preemptive right, right of participation, or any similar right to participate in the transactions contemplated
by the Transaction Documents.  Except as a result of the purchase and sale of the Securities, there are no outstanding
options, warrants, scrip rights to subscribe to, calls or commitments of any character whatsoever relating to, or securities, rights
or obligations convertible into or exercisable or exchangeable for, or giving any Person any right to subscribe for or acquire,
any shares of Common Stock, or contracts, commitments, understandings or arrangements by which the Company or any Subsidiary is
or may become bound to issue additional shares of Common Stock or Common Stock Equivalents.  The issuance and sale of
the Securities will not obligate the Company to issue shares of Common Stock or other securities to any Person (other than the
Purchasers) and will not result in a right of any holder of Company securities to adjust the exercise, conversion, exchange or
reset price under any of such securities. All of the outstanding shares of capital stock of the Company are duly authorized, validly
issued, fully paid and nonassessable, have been issued in compliance with all federal and state securities laws, and none of such
outstanding shares was issued in violation of any preemptive rights or similar rights to subscribe for or purchase securities.  No
further approval or authorization of any stockholder, the Board of Directors or others is required for the issuance and sale of
the Securities.  There are no stockholders agreements, voting agreements or other similar agreements with respect to
the Company’s capital stock to which the Company is a party or, to the knowledge of the Company, between or among any of
the Company’s stockholders.

 

(h)        
SEC Reports; Financial Statements.  The Company has filed all reports, schedules, forms, statements and other
documents required to be filed by the Company under the Securities Act and the Exchange Act, including pursuant to Section 13(a)
or 15(d) thereof, for the two years preceding the date hereof (or such shorter period as the Company was required by law or regulation
to file such material) (the foregoing materials, including the exhibits thereto and documents incorporated by reference therein,
together with the Prospectus and the Prospectus Supplement, being collectively referred to herein as the “SEC Reports”)
on a timely basis or has received a valid extension of such time of filing and has filed any such SEC Reports prior to the expiration
of any such extension.  As of their respective dates, the SEC Reports complied in all material respects with the requirements
of the Securities Act and the Exchange Act, as applicable, and none of the SEC Reports, when filed, contained any untrue statement
of a material fact or omitted to state a material fact required to be stated therein or necessary in order to make the statements
therein, in the light of the circumstances under which they were made, not misleading. The financial statements of the Company
included in the SEC Reports comply in all material respects with applicable accounting requirements and the rules and regulations
of the Commission with respect thereto as in effect at the time of filing.  Such financial statements have been prepared
in accordance with United States generally accepted accounting principles applied on a consistent basis during the periods involved
(“GAAP”), except as may be otherwise specified in such financial statements or the notes thereto and except
that unaudited financial statements may not contain all footnotes required by GAAP, and fairly present in all material respects
the financial position of the Company and its consolidated Subsidiaries as of and for the dates thereof and the results of operations
and cash flows for the periods then ended, subject, in the case of unaudited statements, to normal, immaterial, year-end audit
adjustments.

 

    	 

    	 

    

 

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

 

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

 

(k)        
Labor Relations.  No labor dispute exists or, to the knowledge of the Company, is imminent with respect to any
of the employees of the Company, which could reasonably be expected to result in a Material Adverse Effect.  None of
the Company’s or its Subsidiaries’ employees is a member of a union that relates to such employee’s relationship
with the Company or such Subsidiary, and neither the Company nor any of its Subsidiaries is a party to a collective bargaining
agreement, and the Company and its Subsidiaries believe that their relationships with their employees are good.  To the
knowledge of the Company, no executive officer of the Company or any Subsidiary, is, or is now expected to be, in violation of
any material term of any employment contract, confidentiality, disclosure or proprietary information agreement or non-competition
agreement, or any other contract or agreement or any restrictive covenant in favor of any third party, and the continued employment
of each such executive officer does not subject the Company or any of its Subsidiaries to any liability with respect to any of
the foregoing matters.  The Company and its Subsidiaries are in compliance with all U.S. federal, state, local and foreign
laws and regulations relating to employment and employment practices, terms and conditions of employment and wages and hours, except
where the failure to be in compliance could not, individually or in the aggregate, reasonably be expected to have a Material Adverse
Effect.

 

(l)        
Compliance.  Neither the Company nor any Subsidiary: (i) is in default under or in violation of (and no event
has occurred that has not been waived that, with notice or lapse of time or both, would result in a default by the Company or any
Subsidiary under), nor has the Company or any Subsidiary received notice of a claim that it is in default under or that it is in
violation of, any indenture, loan or credit agreement or any other agreement or instrument to which it is a party or by which it
or any of its properties is bound (whether or not such default or violation has been waived), (ii) is in violation of any judgment,
decree or order of any court, arbitrator or other governmental authority or (iii) is or has been in violation of any statute, rule,
ordinance or regulation of any governmental authority, including without limitation all foreign, federal, state and local laws
relating to taxes, environmental protection, occupational health and safety, product quality and safety and employment and labor
matters, except in each case as could not have or reasonably be expected to result in a Material Adverse Effect.

 

(m)      
Regulatory Permits.  The Company and the Subsidiaries possess all certificates, authorizations and permits issued
by the appropriate federal, state, local or foreign regulatory authorities necessary to conduct their respective businesses as
described in the SEC Reports, except where the failure to possess such permits could not reasonably be expected to result in a
Material Adverse Effect (“Material Permits”), and neither the Company nor any Subsidiary has received any notice
of proceedings relating to the revocation or modification of any Material Permit.

 

    	 

    	 

    

 

(n)       
Title to Assets.  The Company and the Subsidiaries have good and marketable title in fee simple to all real property
owned by them and good and marketable title in all personal property owned by them that is material to the business of the Company
and the Subsidiaries, in each case free and clear of all Liens, except for (i) Liens as do not materially affect the value of such
property and do not materially interfere with the use made and proposed to be made of such property by the Company and the Subsidiaries
and (ii) Liens for the payment of federal, state or other taxes, for which appropriate reserves have been made in accordance with
GAAP and, the payment of which is neither delinquent nor subject to penalties.  Any real property and facilities held
under lease by the Company and the Subsidiaries are held by them under valid, subsisting and enforceable leases with which the
Company and the Subsidiaries are in compliance.

 

(o)       
Intellectual Property.  The Company and the Subsidiaries have, or have rights to use, all patents, patent applications,
trademarks, trademark applications, service marks, trade names, trade secrets, inventions, copyrights, licenses and other intellectual
property rights and similar rights necessary or required for use in connection with their respective businesses as described in
the SEC Reports and which the failure to so have could have a Material Adverse Effect (collectively, the “Intellectual
Property Rights”).  None of, and neither the Company nor any Subsidiary has received a notice (written or otherwise)
that any of, the Intellectual Property Rights has expired, terminated or been abandoned, or is expected to expire or terminate
or be abandoned, within two (2) years from the date of this Agreement.  Neither the Company nor any Subsidiary has received,
since the date of the latest audited financial statements included within the SEC Reports, a written notice of a claim or otherwise
has any knowledge that the Intellectual Property Rights violate or infringe upon the rights of any Person, except as could not
have or reasonably be expected to not have a Material Adverse Effect.  To the knowledge of the Company, all such Intellectual
Property Rights are enforceable and there is no existing infringement by another Person of any of the Intellectual Property Rights.  The
Company and its Subsidiaries have taken reasonable security measures to protect the secrecy, confidentiality and value of all of
their intellectual properties, except where failure to do so could not, individually or in the aggregate, reasonably be expected
to have a Material Adverse Effect.

 

(p)       
Insurance.  The Company and the Subsidiaries are insured by insurers of recognized financial responsibility against
such losses and risks and in such amounts as are prudent and customary in the businesses in which the Company and the Subsidiaries
are engaged, including, but not limited to, directors and officers insurance coverage at least equal to the aggregate Subscription
Amount.  Neither the Company nor any 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 without a significant increase in cost.

 

(q)       
Transactions With Affiliates and Employees.  Except as set forth in the SEC Reports, none of the officers or directors
of the Company or any Subsidiary and, to the knowledge of the Company, none of the employees of the Company or any Subsidiary is
presently a party to any transaction with the Company or any Subsidiary (other than for services as employees, officers and directors),
including any contract, agreement or other arrangement providing for the furnishing of services to or by, providing for rental
of real or personal property to or from, providing for the borrowing of money from or lending of money to or otherwise requiring
payments to or from any officer, director or such employee or, to the knowledge of the Company, any entity in which any officer,
director, or any such employee has a substantial interest or is an officer, director, trustee, stockholder, member or partner,
in each case in excess of $120,000 other than for (i) payment of salary or consulting fees for services rendered, (ii) reimbursement
for expenses incurred on behalf of the Company and (iii) other employee benefits, including stock option agreements under any stock
option plan of the Company.

 

    	 

    	 

    

 

(r)        
Sarbanes-Oxley; Internal Accounting Controls.  The Company and the Subsidiaries are in compliance with any and
all applicable requirements of the Sarbanes-Oxley Act of 2002 that are effective as of the date hereof, and any and all applicable
rules and regulations promulgated by the Commission thereunder that are effective as of the date hereof and as of the Closing Date.  The
Company and the 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 accountability, (iii)
access to assets is permitted only in accordance with management’s general or specific authorization, and (iv) the recorded
accountability for assets is compared with the existing assets at reasonable intervals and appropriate action is taken with respect
to any differences. The Company and the Subsidiaries have established disclosure controls and procedures (as defined in Exchange
Act Rules 13a-15(e) and 15d-15(e)) for the Company and the Subsidiaries and designed such disclosure controls and procedures to
ensure that information required to be disclosed by the Company in the reports it files or submits under the Exchange Act is recorded,
processed, summarized and reported, within the time periods specified in the Commission’s rules and forms.  The
Company’s certifying officers have evaluated the effectiveness of the disclosure controls and procedures of the Company and
the Subsidiaries as of the end of the period covered by the most recently filed periodic report under the Exchange Act (such date,
the “Evaluation Date”).  The Company presented in its most recently filed periodic report under the
Exchange Act the conclusions of the certifying officers about the effectiveness of the disclosure controls and procedures based
on their evaluations as of the Evaluation Date.  Since the Evaluation Date, there have been no changes in the internal
control over financial reporting (as such term is defined in the Exchange Act) of the Company and its Subsidiaries that have materially
affected, or is reasonably likely to materially affect, the internal control over financial reporting of the Company and its Subsidiaries.

 

(s)        
Certain Fees.  Except as set forth in the Prospectus Supplement, no brokerage or finder’s fees or commissions
are or will be payable by the Company or any Subsidiary to any broker, financial advisor or consultant, finder, placement agent,
investment banker, bank or other Person with respect to the transactions contemplated by the Transaction Documents.  The
Purchasers shall have no obligation with respect to any fees or with respect to any claims made by or on behalf of other Persons
for fees of a type contemplated in this Section that may be due in connection with the transactions contemplated by the Transaction
Documents.

 

(t)        
Investment Company. The Company is not, and is not an Affiliate of, and immediately after receipt of payment for the Securities,
will not be or be an Affiliate of, an “investment company” within the meaning of the Investment Company Act of 1940,
as amended.  The Company shall conduct its business in a manner so that it will not become an “investment company”
subject to registration under the Investment Company Act of 1940, as amended.

 

(u)        
Registration Rights.  No Person has any right to cause the Company or any Subsidiary to effect the registration
under the Securities Act of any securities of the Company or any Subsidiary.

 

(v)       
Listing and Maintenance Requirements.  The Common Stock is registered pursuant to Section 12(b) or 12(g) of the
Exchange Act, and the Company has taken no action designed to, or which to its knowledge is likely to have the effect of, terminating
the registration of the Common Stock under the Exchange Act nor has the Company received any notification that the Commission is
contemplating terminating such registration.  The Company has not, in the 12 months preceding the date hereof, received
notice from any Trading Market on which the Common Stock is or has been listed or quoted to the effect that the Company is not
in compliance with the listing or maintenance requirements of such Trading Market. The Company is, and has no reason to believe
that it will not in the foreseeable future continue to be, in compliance with all such listing and maintenance requirements.

 

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

 

(x)        
Disclosure.  Except with respect to the material terms and conditions of the transactions contemplated by the
Transaction Documents, the Company confirms that neither it nor any other Person acting on its behalf has provided any of the Purchasers
or their agents or counsel with any information that it believes constitutes or might constitute material, non-public information
which is not otherwise disclosed in the Prospectus Supplement.   The Company understands and confirms that the Purchasers
will rely on the foregoing representation in effecting transactions in securities of the Company.  All of the disclosure
furnished by or on behalf of the Company to the Purchasers regarding the Company and its Subsidiaries, their respective businesses
and the transactions contemplated hereby is true and correct and does not contain any untrue statement of a material fact or omit
to state any material fact necessary in order to make the statements made therein, in light of the circumstances under which they
were made, not misleading. The press releases disseminated by the Company during the twelve months preceding the date of this Agreement
taken as a whole do not contain any untrue statement of a material fact or omit to state a material fact required to be stated
therein or necessary in order to make the statements therein, in light of the circumstances under which they were made and when
made, not misleading.  The Company acknowledges and agrees that no Purchaser makes or has made any representations or
warranties with respect to the transactions contemplated hereby other than those specifically set forth in Section 3.2 hereof.

 

    	 

    	 

    

 

(y)       
No Integrated Offering. Assuming the accuracy of the Purchasers’ representations and warranties set forth in Section
3.2, neither the Company, nor any of its Affiliates, nor any Person acting on its or 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 cause this
offering of the Securities to be integrated with prior offerings by the Company for purposes of any applicable shareholder approval
provisions of any Trading Market on which any of the securities of the Company are listed or designated.

 

(z)        
Solvency.  Based on the consolidated financial condition of the Company as of the Closing Date, after giving effect
to the receipt by the Company of the proceeds from the sale of the Securities hereunder, (i) the fair saleable value of the Company’s
assets exceeds the amount that will be required to be paid on or in respect of the Company’s existing debts and other liabilities
(including known contingent liabilities) as they mature, (ii) the Company’s assets do not constitute unreasonably small capital
to carry on its business as now conducted and as proposed to be conducted including its capital needs taking into account the particular
capital requirements of the business conducted by the Company, consolidated and projected capital requirements and capital availability
thereof, and (iii) the current cash flow of the Company, together with the proceeds the Company would receive, were it to liquidate
all of its assets, after taking into account all anticipated uses of the cash, would be sufficient to pay all amounts on or in
respect of its liabilities when such amounts are required to be paid.  The Company does not intend to incur debts beyond
its ability to pay such debts as they mature (taking into account the timing and amounts of cash to be payable on or in respect
of its debt).  The Company has no knowledge of any facts or circumstances which lead it to believe that it will file
for reorganization or liquidation under the bankruptcy or reorganization laws of any jurisdiction within one year from the Closing
Date.  The SEC Reports sets forth as of the date hereof all outstanding secured and unsecured Indebtedness of the Company
or any Subsidiary, or for which the Company or any Subsidiary has commitments.  For the purposes of this Agreement, “Indebtedness”
means (x) any liabilities for borrowed money or amounts owed in excess of $50,000 (other than trade accounts payable incurred in
the ordinary course of business), (y) all guaranties, endorsements and other contingent obligations in respect of indebtedness
of others, whether or not the same are or should be reflected in the Company’s consolidated balance sheet (or the notes thereto),
except guaranties by endorsement of negotiable instruments for deposit or collection or similar transactions in the ordinary course
of business; and (z) the present value of any lease payments in excess of $50,000 due under leases required to be capitalized in
accordance with GAAP.  Neither the Company nor any Subsidiary is in default with respect to any Indebtedness.

 

(aa)        
 Tax
Status.  Except for matters that would not, individually or in the aggregate, have or reasonably be expected to
result in a Material Adverse Effect, the Company and its Subsidiaries each (i) has made or filed all United States federal,
state and local income and all foreign income and franchise 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 and (iii) has set aside on its books
provision reasonably adequate for the payment of all material 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 or of any Subsidiary know of no basis for any such
claim.

 

(bb)      Foreign
Corrupt Practices.  Neither the Company nor any Subsidiary, nor to the knowledge of the Company or any Subsidiary,
any agent or other person acting on behalf of the Company or any Subsidiary, has (i) directly or indirectly, used any funds for
unlawful contributions, gifts, entertainment or other unlawful expenses related to foreign or domestic political activity, (ii)
made any unlawful payment to foreign or domestic government officials or employees or to any foreign or domestic political parties
or campaigns from corporate funds, (iii) failed to disclose fully any contribution made by the Company or any Subsidiary (or made
by any person acting on its behalf of which the Company is aware) which is in violation of law, or (iv) violated in any material
respect any provision of FCPA.

 

    	 

    	 

    

 

(cc)         Accountants.  The Company’s accounting firm is set forth in the SEC Reports.  To the knowledge and belief
of the Company, such accounting firm (i) is a registered public accounting firm as required by the Exchange Act and (ii) shall
express its opinion with respect to the financial statements to be included in the Company’s Annual Report for the fiscal
years ending December 31, 2013 and December 31, 2014.

 

(dd)      Acknowledgment
Regarding Purchasers’ Purchase of Securities.  The Company acknowledges and agrees that each of the Purchasers
is acting solely in the capacity of an arm’s length purchaser with respect to the Transaction Documents and the transactions
contemplated thereby.  The Company further acknowledges that no Purchaser is acting as a financial advisor or fiduciary
of the Company (or in any similar capacity) with respect to the Transaction Documents and the transactions contemplated thereby
and any advice given by any Purchaser or any of their respective representatives or agents in connection with the Transaction Documents
and the transactions contemplated thereby is merely incidental to the Purchasers’ purchase of the Securities.  The
Company further represents to each Purchaser that the Company’s decision to enter into this Agreement and the other Transaction
Documents has been based solely on the independent evaluation of the transactions contemplated hereby by the Company and its representatives.

 

(ee)       
Regulation M Compliance.  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 in the stabilization or manipulation of the price of any security of the
Company to facilitate the sale or resale of any of the Securities, (ii) sold, bid for, purchased, or, paid any compensation for
soliciting purchases of, any of the Securities, or (iii) paid or agreed to pay to any Person any compensation for soliciting another
to purchase any other securities of the Company, other than, in the case of clauses (ii) and (iii), compensation paid to the Company’s
placement agent in connection with the placement of the Securities.

 

(ff)        
 Office of Foreign Assets
Control.  Neither the Company nor any Subsidiary nor, to the Company's knowledge, any director, officer, agent, employee
or affiliate of the Company  or any Subsidiary is currently subject to any U.S. sanctions administered by the Office
of Foreign Assets Control of the U.S. Treasury Department (“OFAC”).

 

(gg)        
U.S. Real Property Holding
Corporation.  The Company is not and has never been a U.S. real property holding corporation within the meaning of
Section 897 of the Internal Revenue Code of 1986, as amended, and the Company shall so certify upon Purchaser’s request.

 

(hh)        
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 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.

 

(ii)        
Money Laundering.  The operations of the Company and its Subsidiaries are and have been conducted at all times
in compliance with applicable financial record-keeping and reporting requirements of the Currency and Foreign Transactions Reporting
Act of 1970, as amended, applicable money laundering statutes and applicable rules and regulations thereunder (collectively, the
“Money Laundering Laws”), and no action, suit or proceeding by or before any court or governmental agency, authority
or body or any arbitrator involving the Company or any Subsidiary with respect to the Money Laundering Laws is pending or, to the
knowledge of the Company or any Subsidiary, threatened.

 

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

 

    	 

    	 

    

 

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

  

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

 

    	 

    	 

    

 

ARTICLE IV.

OTHER AGREEMENTS OF THE PARTIES

 

4.1        
Warrant
Shares.  If all or any portion of a Warrant is exercised at a time when there is an effective registration statement
to cover the issuance or resale of the Warrant Shares or if the Warrant is exercised via cashless exercise and Rule 144 is available,
the Warrant Shares issued pursuant to any such exercise shall be issued free of all legends.  If at any time following
the date hereof the Registration Statement (or any subsequent registration statement registering the sale or resale of the Warrant
Shares) is not effective or is not otherwise available for the sale or resale of the Warrant Shares, the Company shall immediately
notify the holders of the Warrants in writing that such registration statement is not then effective and thereafter shall promptly
notify such holders when the registration statement is effective again and available for the sale or resale of the Warrant Shares
(it being understood and agreed that the foregoing shall not limit the ability of the Company to issue, or any Purchaser to sell,
any of the Warrant Shares in compliance with applicable federal and state securities laws).  The Company shall use best
efforts to keep a registration statement (including the Registration Statement) registering the issuance or resale of the Warrant
Shares effective during the term of the Warrants.

 

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

 

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

 

4.4         
Securities Laws Disclosure; Publicity.  The Company shall (a) by 9:30 a.m. (New York City time) on the Trading
Day immediately following the date hereof, issue a press release disclosing the material terms of the transactions contemplated
hereby, and (b) file a Current Report on Form 8-K, including the Transaction Documents as exhibits thereto, with the Commission
within the time required by the Exchange Act.  

 

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

  

4.6        
 Non-Public
Information.  Except with respect to the material terms and conditions of the transactions contemplated by the Transaction
Documents, the Company covenants and agrees that neither it, nor any other Person acting on its behalf will provide any Purchaser
or its agents or counsel with any information that the Company believes constitutes material non-public information, unless prior
thereto such Purchaser shall have entered into a written agreement with the Company regarding the confidentiality and use of such
information.  The Company understands and confirms that each Purchaser shall be relying on the foregoing covenant in
effecting transactions in securities of the Company.

 

    	 

    	 

    

 

4.7        
Use of Proceeds.  The Company shall use the net proceeds from the sale of the Securities hereunder as set forth
in the Prospectus Supplement.

 

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

 

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

 

4.10         
Listing of Common Stock. The Company hereby agrees to use best efforts to maintain the listing or quotation of the Common
Stock on the Trading Market on which it is currently listed, and concurrently with the Closing, the Company shall apply to list
or quote all of the Shares and Warrant Shares on such Trading Market and promptly secure the listing of all of the Shares and Warrant
Shares on such Trading Market. The Company further agrees, if the Company applies to have the Common Stock traded on any other
Trading Market, it will then include in such application all of the Shares and Warrant Shares, and will take such other action
as is necessary to cause all of the Shares and Warrant Shares to be listed or quoted on such other Trading Market as promptly as
possible.  The Company will then take all action reasonably necessary to continue the listing and trading of its Common
Stock on a Trading Market and will comply in all respects with the Company’s reporting, filing and other obligations under
the bylaws or rules of the Trading Market.

 

    	 

    	 

    

 

4.11         Equal
Treatment of Purchasers.  No consideration (including any modification of any Transaction Document) shall be offered
or paid to any Person to amend or consent to a waiver or modification of any provision of any of this Agreement unless the same
consideration is also offered to all of the parties to this Agreement.  For clarification purposes, this provision constitutes
a separate right granted to each Purchaser by the Company and negotiated separately by each Purchaser, and is intended for the
Company to treat the Purchasers as a class and shall not in any way be construed as the Purchasers acting in concert or as a group
with respect to the purchase, disposition or voting of Securities or otherwise.

 

ARTICLE V.

MISCELLANEOUS

 

5.1          
Termination.  This Agreement may be terminated by any Purchaser, as to such Purchaser’s obligations hereunder
only and without any effect whatsoever on the obligations between the Company and the other Purchasers, by written notice to the
other parties, if the Closing has not been consummated on or before March 6, 2014; provided, however, that no such
termination will affect the right of any party to sue for any breach by any other party (or parties).

 

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

  

    	 

    	 

    

 

5.3          
Notices.  Any and all notices or other communications or deliveries required or permitted to be provided hereunder
shall be in writing and shall be deemed given and effective on the earliest of: (a) the date of transmission, if such notice or
communication is delivered via facsimile at the facsimile number set forth on the signature pages attached hereto at or prior to
5:30 p.m. (New York City time) on a Trading Day, (b) the next Trading Day after the date of transmission, if such notice or communication
is delivered via facsimile at the facsimile number set forth on the signature pages attached hereto on a day that is not a Trading
Day or later than 5:30 p.m. (New York City time) on any Trading Day, (c) the second (2nd) Trading Day following the date of mailing,
if sent by U.S. nationally recognized overnight courier service or (d) upon actual receipt by the party to whom such notice is
required to be given.  The address for such notices and communications shall be as set forth on the signature pages attached
hereto.

  

 

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

 

5.5          
Successors and Assigns.  This Agreement shall be binding upon and inure to the benefit of the parties and their
successors and permitted assigns.  The Company may not assign this Agreement or any rights or obligations hereunder without
the prior written consent of each Purchaser (other than by merger).  Any Purchaser may assign any or all of its rights
under this Agreement to any Person to whom such Purchaser assigns or transfers any Securities, provided that such transferee agrees
in writing to be bound, with respect to the transferred Securities, by the provisions of the Transaction Documents that apply to
the “Purchasers.”

 

5.6          
No Third-Party Beneficiaries.  This Agreement is intended for the benefit of the parties hereto and their respective
successors and permitted assigns and is not for the benefit of, nor may any provision hereof be enforced by, any other Person,
except as otherwise set forth in Section 4.8.

 

    	 

    	 

    

  

5.7        
Survival.  The representations and warranties contained herein shall survive the Closing and the delivery of the
Securities.

 

5.8        
Execution.  This Agreement may be executed in two or more counterparts, all of which when taken together shall
be considered one and the same agreement and shall become effective when counterparts have been signed by each party and delivered
to each other party, it being understood that the parties need not sign the same counterpart.  In the event that any
signature is delivered by facsimile transmission or by e-mail delivery of a “.pdf” format data file, such signature
shall create a valid and binding obligation of the party executing (or on whose behalf such signature is executed) with the same
force and effect as if such facsimile or “.pdf” signature page were an original thereof.

 

5.9        
Severability.  If any term, provision, covenant or restriction of this Agreement is held by a court of competent
jurisdiction to be invalid, illegal, void or unenforceable, the remainder of the terms, provisions, covenants and restrictions
set forth herein shall remain in full force and effect and shall in no way be affected, impaired or invalidated, and the parties
hereto shall use their commercially reasonable efforts to find and employ an alternative means to achieve the same or substantially
the same result as that contemplated by such term, provision, covenant or restriction. It is hereby stipulated and declared to
be the intention of the parties that they would have executed the remaining terms, provisions, covenants and restrictions without
including any of such that may be hereafter declared invalid, illegal, void or unenforceable.

 

5.10        
Rescission and Withdrawal Right.  Notwithstanding anything to the contrary contained in (and without limiting
any similar provisions of) any of the other Transaction Documents, whenever any Purchaser exercises a right, election, demand or
option under a Transaction Document and the Company does not timely perform its related obligations within the periods therein
provided, then such Purchaser may rescind or withdraw, in its sole discretion from time to time upon written notice to the Company,
any relevant notice, demand or election in whole or in part without prejudice to its future actions and rights; provided,
however, that in the case of a rescission of an exercise of a Warrant, the applicable Purchaser shall be required to return
any shares of Common Stock subject to any such rescinded exercise notice concurrently with the return to such Purchaser of the
aggregate exercise price paid to the Company for such shares and the restoration of such Purchaser’s right to acquire such
shares pursuant to such Purchaser’s Warrant (including, issuance of a replacement warrant certificate evidencing such restored
right).

 

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

  

 

5.12         Payment
Set Aside.  To the extent that the Company makes a payment or payments to any Purchaser pursuant to any Transaction
Document or a Purchaser enforces or exercises its rights 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, 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.

 

    	 

    	 

    

 

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

  

5.18        
Liquidated Damages.  The Company’s obligations to pay any partial liquidated damages or other amounts owing
under the Transaction Documents is a continuing obligation of the Company and shall not terminate until all unpaid partial liquidated
damages and other amounts have been paid notwithstanding the fact that the instrument or security pursuant to which such partial
liquidated damages or other amounts are due and payable shall have been canceled.

 

5.19        
Saturdays, Sundays, Holidays, etc.  If the last or appointed day for the taking of any action or the expiration
of any right required or granted herein shall not be a Business Day, then such action may be taken or such right may be exercised
on the next succeeding Business Day.

 

5.20        
Construction. The parties agree that each of them and/or their respective counsel have reviewed and had an opportunity to
revise the Transaction Documents and, therefore, the normal rule of construction to the effect that any ambiguities are to be resolved
against the drafting party shall not be employed in the interpretation of the Transaction Documents or any amendments thereto.
In addition, each and every reference to share prices and shares of Common Stock in any Transaction Document shall be subject to
adjustment for reverse and forward stock splits, stock dividends, stock combinations and other similar transactions of the Common
Stock that occur after the date of this Agreement.

  

(Signature Pages Follow)

 

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

 

    	 

    	 

    

 

	CYTOSORBENTS CORPORATION	Address for Notice:
	 	7 Deer Park Drive. Suite K
	 	Monmouth Junction, New Jersey 08852
	 	 
	 	 
	By:	 	
	Name:	 
	Title:	 
	 	 
	With a copy to (which shall not constitute notice):	 

 

Gregg E. Jaclin, Esq.

Szaferman, Lakind, Blumstein & Blader, PC

101 Grovers Mill Road, Suite 200

Lawrenceville, New Jersey 08648

Tel. No.: (609) 275-0400

Fax No.: (609) 275-4511

 

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK

SIGNATURE PAGE FOR PURCHASER FOLLOWS]

 

    	 

    	 

    

 

 

[PURCHASER SIGNATURE PAGES TO CTSO SECURITIES
PURCHASE AGREEMENT]

 

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

 

Name of Purchaser: ________________________________________________________

Signature of Authorized Signatory of Purchaser: _________________________________

Name of Authorized Signatory: _______________________________________________

Title of Authorized Signatory: ________________________________________________

Email Address of Authorized Signatory:_________________________________________

Facsimile Number of Authorized Signatory: ______________________________________

Address for Notice to Purchaser:

 

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

 

Subscription Amount: $_________________

 

Shares: _________________

 

Warrant Shares: __________________

 

EIN Number: _______________________

 

o  Notwithstanding
anything contained in this Agreement to the contrary, by checking this box (i) the obligations of the above-signed to purchase
the securities set forth in this Agreement to be purchased from the Company by the above-signed, and the obligations of the Company
to sell such securities to the above-signed, shall be unconditional and all conditions to Closing shall be disregarded, (ii) the
Closing shall occur on the third (3rd) Trading Day following the date of this Agreement and
(iii) any condition to Closing contemplated by this Agreement (but prior to being disregarded by clause (i) above) that required
delivery by the Company or the above-signed of any agreement, instrument, certificate or the like or purchase price (as applicable)
shall no longer be a condition and shall instead be an unconditional obligation of the Company or the above-signed (as applicable)
to deliver such agreement, instrument, certificate or the like or purchase price (as applicable) to such other party on the Closing
Date.

 

[SIGNATURE PAGES CONTINUE]EMPLOYMENT AGREEMENT
  
 

  
THIS AGREEMENT made as of the 14th day of October 2013 (the "Effective Date") between Next One Interactive, Inc. and Realbiz Media Group, Inc. (collectively, the "Company")  and Deborah Linden (the "Executive").

  
 

  
RECITALS

  
 

  
WHEREAS the Company is engaged in the ownership and management of travel, real estate and media related services (the "Business"); and

  
 

  
WHEREAS the Company desires to employ the Executive and the Executive desires to accept such employment by the Company in connection with the Business, subject to the terms, conditions and covenants herein provided; and 

  
 

  
WHEREAS both parties have agreed to execute, deliver and perform this Agreement.

  
 

  
NOW THEREFORE in consideration of the mutual covenants herein contained and other good and valuable consideration, the Company and the Executive agree as follows:

  
 

  
POSITION

  
 

  	
  
 

	
  
1.

	
  
The Company hereby employs the Executive as, and the Executive agrees to be employed by the Company as the President and Chief Operating Officer of Next 1 Interactive Inc. (“Next 1”)  and as Chief Operating Officer for the Next 1’s subsidiary Realbiz Media Group Inc. (“Realbiz”), on the terms and conditions herein contained. 

	
  
 

	
  
 

	
  
 

	
  
 

	
  
 

	
  
The Executive shall report to the Chief Executive Officer  (as required) of the Company.

	
  
 

	
  
 

	
  
 

	
  
 

	
  
2.

	
  
The Executive shall have such duties and responsibilities as the Executive and the Company’s CEO shall agree upon from time to time.  Initially, such duties and responsibilities will include those set forth on Exhibit A hereto.

	
  
 

	
  
 

	
  
 

	
  
 

	
  
3.

	
  
The Executive shall work primarily out of the office currently leased by Executive  in Orlando, Florida. The Company will assume and pay all costs, expenses and rent associated with such office, the staff working therein, and its operations. It is understood that the Executive’s duties will require spending time in other areas of the United States and Canada, including Weston, Florida and Toronto, Ontario.   

	
  
 

	
  
 

	
  
 

	
  
 

	
  
4.

	
  
The Executive will agree to work with the CEO, CTO, CRO and CFO of the Company to prepare budgets for the Company, develop reporting systems, develop new business opportunities, oversee all operational aspects of the Company, work to develop the travel and incentive side of the operations, help to implement the Travel, Real Estate and Media programs and work directly with the CEO on projects and development of the Company’s business plan and operating systems in an overall effort to aid the Company in achieving its goals of operating in an efficient and fiscally responsible manner.

  
 

  
 

  

  
 

  	
  
 

	
  
5.

	
  
The Executive will be offered a Board Seat on both the Next 1 and Realbiz Boards of Directors.

  
 

  
REMUNERATION

  
 

  	
  
 

	
  
6.

	
  
(a)       The Executive shall receive a minimum base salary from the Company of no less than US$200,000 per year for the first year of employment, however, during the first 90 days after the Effective Date, the salary will be paid in a combination of cash and stock as follows:

	
  
 

	
  
 

	
  
 

	
  
 

	
  
 

	
  
For the first 90 days after the Effective Date, the Executive will receive $5000 per month (total $15,000 in cash) and will further receive $12,000 per month (total of $36,000 in stock). Stock payments will be made and earned on the Effective Date as follows:

	
  
 

	
  
 

	
  
 

	
  
 

	
  
 

	
  
i) 30,000 Next 1 Preferred C shares which accumulate a 10% dividend and are convertible into Realbiz common stock at $0.10 per shares) 

	
  
 

	
  
 

	
  
 

	
  
 

	
  
 

	
  
ii) 600,000 Next 1 common shares (representing approximately 5% of the issued shares of Next 1 as of October 14, 2013).

	
  
 

	
  
 

	
  
 

	
  
 

	
  
 

	
  
Thereafter, the Company and the Executive will complete a 90 day review and if both parties are satisfied, the Executive’s salary will increase to at least $200,000 per year in cash starting on the 91st day after the Effective Date through the end of the first year of this Agreement. 

	
  
 

	
  
 

	
  
 

	
  
 

	
  
 

	
  
iii) The Executive’s salary will be raised to a minimum annual salary of $250,000 for the second year of employment, however the Company may move to increase this salary based upon the level of profitability of the Company achieved during the second 180 days of Executive’s employment.

	
  
 

	
  
 

	
  
 

	
  
 

	
  
 

	
  
iv) Thereafter salary increases will be negotiated in good faith between the Executive and the CEO.  

	
  
 

	
  
 

	
  
 

	
  
 

	
  
 

	
  
During the term of this Agreement Executive’s salary shall be payable in accordance with the Company's payroll practices in force from time to time shall be inclusive of all applicable income tax withholding, employment insurance and other taxes and charges that are required by law to be withheld by the Company or the Executive.

	
  
 

	
  
 

	
  
 

	
  
 

	
  
 

	
  
(b)      Except as otherwise provided herein, the Executive’s salary shall be pro-rated for any partial year.

  
 

  
 

  

  
 

  	
  
 

	
  
 

	
  
(c)       The Company will agree to enter into an option plan with the Executive for Stock options to be set under similar terms and conditions as those of other senior management as soon as the stock option plan for the Next 1 is approved by its Board of Directors. 

  
 

  
BONUSES.  

  
 

  	
  
 

	
  
7.

	
  
(a)       The Company will issue a Bonus to the Executive of up to 2% of the consolidated EBITDA of the Company up to a maximum of $150,000 paid in stock of Realbiz based on the current price of $2.50 per share for each of the 3 years of the term of this Agreement. Such stock bonus will be automatically earned at the end of each fiscal year end for the Company based on the Audited Financial statements for the Company.

	
  
 

	
  
 

	
  
 

	
  
 

	
  
 

	
  
(b)      The Company will agree to include the Executive in any cash bonuses (“Other Bonuses”) that may be set from time to time by the Board of Directors as part of a Senior Management Incentive package. Such Other Bonuses are at the discretion of the Board of Directors and if set, will include the Key Senior Management comprising of the CEO, CFO and COO.          

  
 

  
BENEFITS AND EXPENSES

  
 

  	
  
 

	
  
8.

	
  
The Executive shall be entitled to participate in any health, life and medical benefit plan made available by the Company generally to its executives, as amended from time to time. The Company shall pay all necessary and reasonable business expenses incurred by the Executive, as approved by the Company’s CEO which approval shall not be unreasonably withheld, and which are actually and properly incurred by the Executive in furtherance of or in connection with the Business, including without limitation, all business related travel and parking expenses, public relations expenses, ARDA trustee dues and convention expenses, and all business related entertainment expenses (whether incurred at the Executive's residence, while traveling or otherwise).  If any such expenses are paid in the first instance by the Executive, the Company shall reimburse her therefor, subject to the receipt by the Company of statements and vouchers in a form used by other executives of the Company.

  
 

  
VACATION

  
 

  	
  
 

	
  
9.

	
  
The Executive shall be entitled to four (4) weeks paid vacation in each year of the Term of this Agreement.  In the event of termination of this Agreement and the Executive's employment, the Executive shall be entitled to payment for any vacation time accrued up to the date of termination but unused.

  
 

  
 

  

  
 

  
TERM  

  
 

  	
  
 

	
  
10.

	
  
(a)       The initial term of this Agreement (the "Initial Term"), and the Executive's employment hereunder, shall be for a period of three (3) years commencing as of the Effective Date, unless sooner terminated in accordance with the provisions of this Section 10; provided that upon the expiration of the Initial Term, this Agreement shall be automatically renewed for successive periods of one (1) year each (each a “Renewal Term”), unless at least 90 days prior to the expiration of the Initial Term or any Renewal Term, as the case may be, either the Executive or the Company gives written notice to the other of its intention to terminate this Agreement upon the expiration of the Initial Term or the applicable Renewal Term, as the case may be. For the purposes of this Agreement, if such notice is not given at least 90 days prior to the expiration of the Initial Term or Renewal Term, as the case may be, the employment of the Executive hereunder shall be deemed to be automatically renewed for a one-year period following the date of such expiration upon the same terms as the preceding year.  Notwithstanding anything to the contrary set forth herein, there shall not be any more than four (4) Renewal Terms.  The Initial Term, as it may be extended by one or more Renewal Terms, is referred to herein as the Term.

	
  
 

	
  
 

	
  
 

	
  
 

	
  
 

	
  
(b)      In the event of the delivery by the Executive of a notice pursuant to section 10(a), the Executive shall be deemed to have voluntarily resigned from her employment hereunder effective on the expiration of the Initial Term or Renewal Term, as the case may be.  In the event of termination by the Executive under this section 10, the Executive shall be entitled to salary and benefits (including, without limitation, Executive’s Bonus) earned up until termination and shall be entitled to reimbursement of business expenses recoverable under section 8, above, incurred up until termination. Notwithstanding the foregoing and notwithstanding the provisions of Article 10 hereof, in the event the Executive delivers a notice pursuant to subsection 10(a) and is thereby deemed to have voluntarily resigned from her employment effective on the expiration of the Initial Term or the Renewal Term, upon receipt of such notice, the Company shall have the right to immediately terminate the employment of the Executive hereunder and in such event the Executive shall only be entitled to her salary and benefits (including, without limitation, Executive’s Bonus) earned up until termination and shall be entitled to reimbursement of business expenses recoverable under section 8 above, incurred up until termination.

	
  
 

	
  
 

	
  
 

	
  
 

	
  
 

	
  
(c)       In the event of the delivery by the Company of a notice pursuant to section 10(a), Company shall pay Executive her salary and benefits (including, without limitation, Executive’s Bonus) earned or accrued through the date of termination and shall reimburse Executive for business expenses recoverable under section 8, above, incurred up until the date of termination.  

  
 

  
 

  
  

 

  
TERMINATION

  
 

  	
  
 

	
  
11.

	
  
(a)       Events of Termination.  The Term, the Executive’s salary and any and all other rights of the Executive under this Agreement or otherwise as an executive of the Company will terminate (except as otherwise provided in section 10 or 11):

  
 

  	
  
 

	
  
(i)

	
  
upon the death of the Executive;

	
  
 

	
  
 

	
  
 

	
  
 

	
  
(ii)

	
  
upon the disability of the Executive (as defined in section 11(b)) immediately upon notice from either party to the other; 

	
  
 

	
  
 

	
  
 

	
  
 

	
  
(iii)

	
  
For Cause (as defined in section 11(c)), immediately upon notice from the Company to the Executive or at such later time as such notice may specify; 

	
  
 

	
  
 

	
  
 

	
  
 

	
  
(iv)

	
  
Other than For Cause, Disability or Death, immediately upon notice from the Company to the Executive or at such later time as such notice may specify; or

	
  
 

	
  
 

	
  
 

	
  
 

	
  
(v)

	
  
For Good Reason (as defined in section 11(d)) upon not less than 10 days' prior notice from the Executive to the Company.

  
 

  	
  
 

	
  
 

	
  
(b)      Definition of Disability.  For the purposes of section 11(a), the Executive will be deemed to have a "disability" if, for physical or mental reasons, the Executive is unable to perform the Executive's duties for a period of 120 days out of any 180 consecutive days, under this Agreement as determined in accordance with this section 11(b).  The disability of the Executive will be determined by a medical doctor selected by written agreement of the Company and the Executive upon the request of either party by notice to the other.  If the Company and the Executive cannot agree on the selection of a medical doctor, each of them will select a medical doctor and the two medical doctors will select a third medical doctor who will determine whether the Executive has a disability. The determination of the medical doctor selected under this section 11(b) will be binding on both parties.

	
  
 

	
  
 

	
  
 

	
  
 

	
  
 

	
  
(c)       Definition of "For Cause".  For the purposes of section 11(a), the phrase "For Cause" means: (i) the Executive's willful and material breach of this Agreement after notice and a reasonable opportunity to cure the breach; (ii) the Executive’s failure to substantially perform the duties of Chief Operating Officer (or such other position with the Company as Executive may hold) as contemplated hereunder; (iii) the Executive's failure to substantially adhere to any reasonable written Company policy if the Executive has been given a reasonable opportunity to comply with such policy or cure her failure to comply; (iv) the misappropriation by the Executive of a material business opportunity of the Company, including securing any undisclosed personal profit in connection with any transaction entered into on behalf of the Company; (v) the misappropriation of any of the Company's funds, property or Confidential Information; (vi) the commission of material acts of dishonesty, willfully fraudulent or criminal acts or misconduct, or other willfully wrongful acts or omissions materially adversely affecting the Company; (vii) the conviction of, the indictment for or its procedural equivalent or the entering of a guilty plea or plea of no contest with respect to any felony.

	
  
 

	
  
 

	
  
        

    

  
 

  	
  
 

	
  
 

	
  
(d)      Definition of "For Good Reason."  For the purposes of section 11(a), the phrase "For Good Reason" means the Company's material breach of this Agreement. 

	
  
 

	
  
 

	
  
 

	
  
 

	
  
 

	
  
(e)       Termination Pay.  Effective upon the termination of this Agreement for any of the reasons set forth in section11(a), the Company shall be obligated to pay the Executive (or in the event of her death, her designated beneficiary as defined below) the compensation and Bonus provided below in this section 11(a), as well as all business expenses recoverable under Section 8. For purposes of this section 11(e), the Executive's designated beneficiary will be such individual beneficiary or trust, located at such address, as the Executive may designate by notice to the Company from time to time or if the Executive fails to give notice to the Company of such a beneficiary, the Executive's estate. Notwithstanding the preceding sentence, the Company will have no duty, in any circumstances, to attempt to open an estate on behalf of the Executive, to determine whether any beneficiary designated by the Executive is alive or to ascertain the address of any such beneficiary, to determine the existence of any trust, to determine whether any person or entity purporting to act as the Executive's personal representative (or the trustee of a trust established by the Executive) is duly authorized to act in that capacity or to locate or attempt to locate any beneficiary, personal representative, or trustee.

  
 

  	
  
 

	
  
(i)        Termination by the Executive For Good Reason.  If the Executive terminates this Agreement for Good Reason, the Company shall pay the Executive her salary, Bonus and other benefits earned or accrued through the effective date of termination.

	
  
 

	
  
 

	
  
 

	
  
(ii)       Termination by the Company For Cause.  If the Company terminates this Agreement For Cause, the Company shall pay Executive her salary, Bonus and other benefits earned or accrued through the effective date of termination. 

	
  
 

	
  
 

	
  
 

	
  
(iii)      Termination upon Disability.  If this Agreement is terminated by either party as a result of the Executive's disability, as determined under section 11(a)(ii), the Company shall pay the Executive her salary, Bonus and other benefits earned or accrued through the remainder of the calendar month during which such termination becomes effective.

	
  
 

	
  
 

	
  
 

	
  
(iv)     Termination upon Death.  If this Agreement is terminated because of the Executive's death, the Company shall pay Executive’s estate or designated beneficiary the Executive’s salary, Bonus and other benefits earned or accrued through the date of death.

	
  
 

	
  
 

	
  
 

	
  
(v)      Termination by Company Other than For Cause, Disability or Death. If the Company terminates this Agreement other than For Cause or for death or disability, the Company shall pay Executive her Salary, Bonus and other benefits earned or accrued through 90 days beyond the effective date of termination.

  
 

  
 

  

  
 

  
CONFIDENTIALITY

  
 

  	
  
 

	
  
12.

	
  
(a)       All confidential records, materials and information, and all trade secrets concerning the Business or affairs of the Company obtained by the Executive in the course of her employment with the Company shall remain the exclusive property of the Company.  During the Executive's employment or at any time thereafter, the Executive shall not divulge the contents of such confidential records, materials and information, or trade secrets to any person, firm or corporation, other than to the Company or the Company’s qualified executives, agents, contractors, attorneys and accountants and following the termination of her employment hereunder, the Executive shall not, for any reason, use the contents of such confidential records, material, information or trade secrets for any purpose whatsoever.  This section shall not apply to any confidential records, materials and information or trade secrets which:

  
 

  	
  
 

	
  
(1)

	
  
is or becomes publicly known through the action of any third party;

	
  
 

	
  
 

	
  
 

	
  
 

	
  
(2)

	
  
is disclosed without restriction to the Executive by a third party;

	
  
 

	
  
 

	
  
 

	
  
 

	
  
(3)

	
  
is known by the Executive prior to its disclosure by the Company;

	
  
 

	
  
 

	
  
 

	
  
 

	
  
(4)

	
  
is subsequently developed by the Executive, independently of records, material, information and trade secrets supplied to the Executive by the Company;

	
  
 

	
  
 

	
  
 

	
  
 

	
  
(5)

	
  
has been made available by the Company directly or indirectly to a third party without obligation of confidentiality; or

	
  
 

	
  
 

	
  
 

	
  
 

	
  
(6)

	
  
the Executive is obligated to produce as a result of a court order or pursuant to governmental or other legal action, provided that the Company shall have been given written notice of such court order or governmental or other legal action and an opportunity to appear and object.

  
 

  	
  
 

	
  
(b)      The Executive agrees that all Confidential Information which the Executive develops, prepares or works on either individually or on a team during the Term with the Company shall belong exclusively to the Company and the Executive hereby assigns to the Company all title and interest, including copyright and patent rights, thereto and waives any moral rights which the Executive may have therein.  If the Executive develops, prepares or works on the design or development of Confidential Information of any kind during the Term, the Executive will keep notes and other written records of such work, which records shall be kept on the premises of the Company and made available to the Company at all times for the purpose of evaluation and use in obtaining copyright protection or as a protective procedure. The Executive will upon request of the Company, and at the Company's expense, provide a reasonable level of assistance to the Company with respect to applications for trade marks, copyrights, patents or other forms of intellectual property protection for work on which the Executive was involved during the Term. The Executive agrees to execute such documents as are reasonable and necessary for the purpose of the Company establishing its right of ownership to such property.

  
 

  
 

  

  
 

  
NON-SOLICITATION

  
 

  	
  
 

	
  
13.

	
  
The Executive covenants and agrees with the Company that she shall not, during the term of her employment hereunder and for a period ending ninety (90) days following the date of the termination (for any reason) of her employment:

  
 

  	
  
 

	
  
(a)       directly or indirectly solicit, interfere with or endeavor to direct or entice away from the Company any person, firm or company who is or has within the preceding year been a customer, client, affiliated agency or otherwise in the habit of dealing with the Company; or

	
  
 

	
  
 

	
  
 

	
  
(b)      interfere with, entice away or otherwise attempt to induce the termination of employment of any employee of the Company.

  
 

  
NON-COMPETITION

  
 

  	
  
 

	
  
14.

	
  
The Executive covenants and agrees with the Company that she will not (without the prior written consent of the Company which consent will not be unreasonably withheld) directly or indirectly, during the Term of her employment hereunder and for a period 30 days following the date of the termination of her employment, carry on or be engaged in any business within North America which is competitive with the Business (a "Competitive Business") where such Competitive Business involves “clients or accounts” that were introduced to the Executive by the Company.

  
 

  
INJUNCTIVE RELIEF

  
 

  	
  
 

	
  
15.

	
  
The Executive acknowledges and agrees that the agreements and covenants in sections 12 to 14 are essential to protect the Business and goodwill of the Company and that a breach by the Executive of the covenants in sections 12 to 14 hereof could result in irreparable loss to the Company which could not be adequately compensated for in damages and that the Company may have no adequate remedy at law if the Executive breaches such provisions.  Consequently, if the Executive breaches any of such provisions, the Company shall have in addition to and not in lieu of, any other rights and remedies available to it under any law or in equity, the right to obtain injunctive relief to restrain any breach or threatened breach thereof and to have such provisions specifically enforced by any court of competent jurisdiction.

  
 

  
 

  
  

 

  
DISPUTE RESOLUTION PROCEDURE

  
 

  	
  
 

	
  
16.

	
  
(a)       The parties shall be free to bring all differences of interpretation and disputes arising under or related to this Agreement to the attention of the other party at any time without prejudicing their harmonious relationship and operations hereunder and the offices and facilities of either party shall be available at all times for the prompt and effective adjustment of any and all such differences, either by mail, telephone, or personal meeting, under friendly and courteous circumstances.  Notwithstanding the foregoing, any controversy, claim, or breach arising out of or relating to this Agreement which the parties are unable to resolve to their mutual satisfaction shall be resolved in accordance with subparagraph b below.

	
  
 

	
  
 

	
  
 

	
  
 

	
  
 

	
  
(b)      As a condition precedent to invoking any other dispute resolution procedure including litigation, the parties shall attempt in good faith first to mediate such dispute and use their best efforts to reach agreement on the matters in dispute.  Within five (5) business days of the request of either party, the requesting party shall attempt to employ the services of a third person mutually acceptable to both parties to conduct such mediation within five (5) business days of the mediator's appointment.  Unless otherwise agreed upon by the parties hereto, the parties shall share the cost of the mediator's fees and expenses equally.  If the parties are unable to agree on such third person, then the requesting party may submit the matter to the nearest office of the American Arbitration Association for mediation, only, in accordance with the commercial mediation rules then prevailing.  If, on completion of such mediation, the parties are still unable to agree upon and settle the dispute, then either party may initiate litigation.  This Agreement contains no arbitration clause. Binding arbitration may only be used upon the mutual agreement of the parties hereto.

  
 

  
SEVERABILITY

  
 

  	
  
 

	
  
17.

	
  
The parties acknowledge that the provisions of sections 12 to 14 hereof (the "Restrictive Covenants") are reasonable and valid in geographic and temporal scope and all other respects.  If any court of competent jurisdiction determines that any of the Restrictive Covenants or any part thereof, is or are invalid or unenforceable, the remainder of the Restrictive Covenants shall not thereby be affected and shall be given full effect, without regard to invalid portions.  If any court of competent jurisdiction determines that any of the Restrictive Covenants or any part thereof is unenforceable because of the duration or geographic scope of such provision, such court shall have the power to reduce the duration or scope of such provision, as the case may be and, in its reduced form, such provision shall then be enforceable.  The Executive acknowledges that the Company's business extends throughout the geographical area outlined above and that the geographic scope of the covenants contained herein is reasonable.

  
 

  
 

  
  

 

  
INDEMNITY

  
 

  	
  
 

	
  
18.

	
  
Except for acts of dishonesty, willfully fraudulent or criminal acts, or other willfully wrongful acts or omissions on the part of Executive, the Company agrees to indemnify and save the Executive harmless from and against any and all damages, liabilities, claims, costs, including reasonable attorneys’ fees, charges and expenses, including any amount paid to settle any action or satisfy any judgment, incurred by her in connection with her employment or incurred by her in respect of any civil, criminal or administrative action or proceeding to which the Executive is made a party by reason of having been an officer or employee of the Company. The Company shall maintain directors and officers liability insurance during the Term of this Agreement.

  
 

  
WHOLE AGREEMENT

  
 

  	
  
 

	
  
19.

	
  
This Agreement constitutes and expresses the whole agreement of the parties hereto with respect to the employment of the Executive by the Company and with respect to any matters or things herein provided for or hereinbefore discussed or mentioned with reference to such employment.  All promises, representations, collateral agreements and understandings relative thereto not incorporated herein are hereby superseded by this Agreement.

  
 

  
GENERAL

  
 

  	
  
 

	
  
20.

	
  
All notices, request, demands or other communications by the terms hereof required or permitted to be given by one party to the other shall be given in writing by personal delivery or by facsimile, addressed to the other party as follows:

  
 

  	
  
 

	
  
(a)

	
  
to the Company at:

	
  
Next One Interactive

	
  
 

	
  
 

	
  
 

	
  
2690 Weston Rd. Weston FL 33331

	
  
 

	
  
 

	
  
Attention:

	
  
William Kerby

	
  
 

	
  
 

	
  
Facsimile No:

	
  
(954) 888-9082

  
 

  	
  
 

	
  
(b)

	
  
to the Executive at:

	
  
Deborah Linden 

	
  
 

	
  
 

	
  
 

	
  
5092 Isleworth Country Club Drive

	
  
 

	
  
 

	
  
 

	
  
Windermere, FL 34786

	
  
 

	
  
 

	
  
Facsimile No:

	
  
(407) 876-3891

  
 

  	
  
 

	
  
or such other addresses as may be given by either of them to the other in writing from time to time.

  
 

  	
  
 

	
  
21.

	
  
This Agreement shall be governed by and interpreted under the laws of the State of Florida without regard to principals of conflicts of law. 

	
  
 

	
  
 

	
  
 

	
  
 

	
  
22.

	
  
All dollar amounts referred to in this Agreement are expressed in U.S. funds.

  
 

  
 

  

  
 

  	
  
 

	
  
23.

	
  
(a)       This Agreement is personal to the Executive and may not be assigned by her.

	
  
 

	
  
 

	
  
 

	
  
 

	
  
 

	
  
(b)      Upon notice to the Executive, this Agreement may be assigned to an affiliate of the Company, provided that notwithstanding such assignment, the Company continues to guarantee the performance by such assignee of its obligations hereunder. This Agreement shall not otherwise be assigned by Company and such restriction shall include any assignment by operation of law.

	
  
 

	
  
 

	
  
 

	
  
 

	
  
 

	
  
(c)       Except as aforesaid, this Agreement shall enure to the benefit of and be binding upon the parties hereto and their respective successors and assigns, including, in the case of the Executive, her heirs, executors, administrators and legal personnel representatives.

	
  
 

	
  
 

	
  
 

	
  
 

	
  
24.

	
  
Time shall be of the essence of this Agreement and of every part hereof.

	
  
 

	
  
 

	
  
 

	
  
 

	
  
25.

	
  
The parties acknowledge and agree that, except to the extent the context clearly requires otherwise, the representations, warranties and covenants set forth herein shall survive the termination or expiration of this Agreement.

	
  
 

	
  
 

	
  
 

	
  
 

	
  
26.

	
  
The parties acknowledge that each of them has read and understood this Agreement, and that each of them has been given the opportunity to obtain independent legal advice in connection with this Agreement and its terms.

  
 

  
IN WITNESS WHEREOF the parties hereto have executed this Agreement as of the date first above written.

  
 

  	
  
 

	
  
Next One Interactive, Inc.

	
  
 

	
  
 

	
  
 

	
  
 

	
  
 

	
  
 

	
  
 

	
  
By:

	
  
/s/ William Kerby

	
  
 

	
  
 

	
  
William Kerby

	
  
 

	
  
 

	
  
 

	
  
 

	
  
Realbiz Media Group, Inc.

	
  
 

	
  
 

	
  
 

	
  
 

	
  
By:

	
  
/s/ William Kerby

	
  
 

	
  
 

	
  
William Kerby

	
  
 

	
  
 

	
  
 

	
  
 

	
  

  
/s/ Deborah Linden.

	
  
 

	
  
Deborah Linden.

  
   

  
 

  
  

  
 

  EXHIBIT A
  
To the Employment Agreement Dated the 1st day of October   2013

  
by and between

  
Next One Interactive, Inc./Realbiz Media  

  
And

  
 Deb Linden

  
 

  
The Executive’s initial responsibilities are as follows:

  
 

  
Duties:

  
 

  
Responsible for the day to day operations of Next 1 and Realbiz.

  
 

  
Responsible for overseeing theTravel, Real Estate and Media operations including the company TV and  web properties.

  
 

  
Work with the CEO to assist in setting of the direction of the corporation

  
Implementation of reporting systems

  
 

  
Setting up Structure and staff roles, responsibilities, goals and objectives.

  
 

  
Coordinating the Media , Real Estate and Travel divisions operations to ensure they act in an efficient and profitable manner.

  
 

  
Review of existing staff and assessing capabilities including position changes, hiring and firing as required

  
 

  
Working with the CFO to review expenditures and ensure efficiencies and cost control system/best practices are implemented and practiced

  
 

  
Additionally the Executive will assume overall control of the relationship between Next 1 and Ice Gallery  to get effectively on-board  Real Estate  opportunities , plan and implement the expansion of product categories ( more profitable) categories, integrate travel opportunities  and develop/implement a long term strategy to optimize the relationship with consumers we develop.

  
 

  	
	
·	
Represent N1/RBM in negotiations with Agent brands or Broker negotiations

  
·      Work with ICE to 'productize" programs for use with RBM clients

  	
	
·	
Negotiate/implement  custom agreements from ICE for programs developed  with RBM

  
·      Ensure joint marketing programs are defined and executed

  	
	
·	
Monitor programs  and reporting to recommend improvements and upgrades to drive revenue growth

  
 

  
 

  

  
 

  	
	
·	
Work with the content team to build an incentive program for third parties motivate agents e.g. Home Depot, Lowes, Mortgage Companies etc.

  
·      Identify and negotiate inclusion of new product categories into ICE offering

  	
	
·	
Manage financial relationship with ICE include revenue share, profit contribution revision to terms

  
·      Integrate high margin travel opportunities and integrate N1 travel assets e.g. Maupintour  to become a preferred supplier

  	
	
·	
Identify  categories opportunities outside of  Real Estate  and Travel that can be integrated into our consumer relationship and test for full implementation

  
·      Look to integrate platforms such as “rent to own concept”

  
 

  
Other Opportunities.

  
 

  
Should Executive aid the CEO with the introduction of individuals wishing to invest New Capital into either  Next 1 or Realbiz, then the Executive will be eligible  to receive  a 7% finder’s fee on such introductions should a private placement be completed.

  
 

  
Such other duties as may be assigned by the CEO from Time to Time

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