Document:

Exhibit 10.4

 

SECURITIES PURCHASE AGREEMENT

 

This Securities Purchase
Agreement (this “Agreement”) is dated as of February 22, 2019, between Ideanomics, Inc., 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 Section 4(a)(2) of the Securities Act of 1933, as amended
(the “Securities Act”), and Rule 506 promulgated thereunder, 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: (a) capitalized terms that are not otherwise defined herein have
the meanings given to such terms in the Debentures (as defined herein), and (b) the following terms have the meanings set forth
in this Section 1.1:

 

“Additional Shares” shall have the
meaning ascribed to such term in Section 4.12.

 

“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.

 

“Applicable Subsidiary” means GrapeVine
Logic, Inc., a Delaware corporation.

 

“Applicable
Subsidiary Release” shall have the meaning ascribed to such term in Section 4.12.

 

“Applicable
Subsidiary Release Notice” shall have the meaning ascribed to such term in Section 4.12.

 

“Applicable
Subsidiary Release Notice Date” shall have the meaning ascribed to such term in Section 4.12.

 

“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.

 

“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 Morrison & Foerster LLP, with offices located at 250 West 55th Street, New York, New York 10019-9601.

 

“Conversion
Price” shall have the meaning ascribed to such term in the Debentures.

 

“Conversion
Shares” shall have the meaning ascribed to such term in the Debentures.

 

“Debentures”
means the 10% Senior Secured Convertible Debentures due, subject to the terms therein, eighteen (18) months from their date of
issuance, issued by the Company to the Purchasers hereunder, in the form of Exhibit A attached hereto.

 

“Disclosure Schedules” means the
disclosure schedules delivered herewith.

 

“EGS”
means Ellenoff Grossman & Schole LLP, with offices located at 1345 Avenue of the Americas, New York, New York 10105-0302.

 

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

 

    	 	2	 

     

    

 

“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 for services rendered to the Company, (b)
securities upon the exercise or exchange of or conversion of or interest payment on 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 (other than in connection with
stock splits or combinations) or to extend the term 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 such securities are issued as
“restricted securities” (as defined in Rule 144) and carry no registration rights that require or permit the filing
of any registration statement in connection therewith during the prohibition period in Section 4.10(a) herein, and 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 (in each case in the sole judgment of a majority of the Board
of Directors), 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.

 

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

 

“Indebtedness”
means (x) any liabilities for borrowed money or amounts owed in excess of $100,000 (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 $100,000 due under leases required to be capitalized
in accordance with GAAP.

 

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

 

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

 

    	 	3	 

     

    

 

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

 

“Maximum Rate” shall have the meaning
ascribed to such term in Section 5.17.

 

“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.

 

“Pledged Securities”
means any and all certificates and other instruments representing or evidencing all of the capital stock and other equity interests
of the Applicable Subsidiary.

 

“Proceeding”
means an action, claim, suit, investigation or proceeding, whether commenced or threatened.

 

“Public Information
Failure” shall have the meaning ascribed to such term in Section 4.2(b).

 

“Public Information
Failure Payments” shall have the meaning ascribed to such term in Section 4.2(b).

 

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

 

“Registration
Rights Agreement” means the Registration Rights Agreement, dated on or about the date hereof, among the Company and
the Purchasers, in the form of Exhibit B attached hereto.

 

“Registration
Statement” means a registration statement meeting the requirements set forth in the Registration Rights Agreement and
covering the resale of the Shares and the Underlying Shares by each Purchaser as provided for in the Registration Rights Agreement.

 

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

 

“Required
Minimum” means, as of any date, the maximum aggregate number of shares of Common Stock then issued or potentially issuable
in the future pursuant to the Transaction Documents, including any Underlying Shares issuable upon exercise in full of all Warrants
or conversion in full of all Debentures (including Underlying Shares issuable as payment of interest on the Debentures), ignoring
any conversion or exercise limits set forth therein, and assuming that the Conversion Price is at all times on and after the date
of determination 75% of the then applicable Conversion Price on the Trading Day immediately prior to the date of determination.

 

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

 

    	 	4	 

     

    

 

“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.

 

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

 

“Securities”
means the Debentures, the Shares, the Warrants, and the Underlying Shares.

 

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

 

“Security
Agreement” means the Security Agreement, dated on or about the date hereof, between the Company and the Purchasers, in
the form of Exhibit E attached hereto.

 

“Security
Documents” shall mean the Security Agreement, the Subsidiary Guarantee, the original Pledged Securities, along with medallion
guaranteed executed blank stock powers to the Pledged Securities and any other documents and filing required thereunder in order
to grant the Purchasers a first priority security interest in the assets of the Company and the Subsidiaries as provided in the
Security Agreement, including all UCC-1 filing receipts.

 

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

 

“Series B Warrants” means, collectively,
the Series B Warrants delivered to the Purchasers pursuant to the terms and conditions of the Debenture.

 

“Shareholder
Approval” means such approval as may be required by the applicable rules and regulations of the Nasdaq Stock Market (or
any successor entity) from the shareholders of the Company with respect to the transactions contemplated by the Transaction Documents,
including the issuance of all of the Shares and the Underlying Shares in excess of 19.99% of the issued and outstanding Common
Stock on the Closing Date.

 

“Shares”
means the shares of Common Stock issued to the Purchaser at the Closing pursuant to Section 2.2(a)(v) and the Additional Shares.

 

“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 locating and/or borrowing shares of Common Stock).

 

    	 	5	 

     

    

 

“Subscription
Amount” means, as to each Purchaser, the aggregate amount to be paid for Debentures, 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.

 

“Subsidiary
Guarantee” means the Subsidiary Guarantee, dated on or about the date hereof, by the Applicable Subsidiary in favor of
the Purchasers, in the form of Exhibit F attached hereto.

 

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

 

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

 

“Transaction
Documents” means this Agreement, the Debentures, the Warrants, the Registration Rights Agreement, the Security Agreement,
all exhibits and schedules thereto and hereto and any other documents or agreements executed in connection with the transactions
contemplated hereunder.

 

“Transfer
Agent” means Transfer Online, the current transfer agent of the Company, with a mailing address of 512 SE Salmon Street,
Portland, Oregon 97214 and a facsimile number of (503) 227-6874, and any successor transfer agent of the Company.

 

“Underlying
Shares” means the Warrant Shares and shares of Common Stock issued and issuable pursuant to the terms of the Debenture,
including without limitation, shares of Common Stock issued and issuable in lieu of the cash payment of interest on the Debentures
in accordance with the terms of the Debentures, in each case without respect to any limitation or restriction on the conversion
of the Debentures or the exercise of the Warrants.

 

“VWAP”
means, for any date, the price determined by the first of the following clauses that applies: (a) if the Common Stock is then listed
or quoted on a Trading Market, the daily volume weighted average price of the Common Stock for such date (or the nearest preceding
date) on the Trading Market on which the Common Stock is then listed or quoted as reported by Bloomberg L.P. (based on a Trading
Day from 9:30 a.m. (New York City time) to 4:02 p.m. (New York City time)), (b) if OTCQB or OTCQX is not a Trading Market, the
volume weighted average price of the Common Stock for such date (or the nearest preceding date) on OTCQB or OTCQX as applicable,
(c) if the Common Stock is not then listed or quoted for trading on OTCQB or OTCQX and if prices for the Common Stock are then
reported in the “Pink Sheets” published by OTC Markets Group, Inc. (or a similar organization
or agency succeeding to its functions of reporting prices), the most recent bid price per share of the Common Stock so reported,
or (d) in all other cases, the fair market value of a share of Common Stock as determined by an independent appraiser selected
in good faith by the Purchasers of a majority in interest of the Securities then outstanding and reasonably acceptable to the Company,
the fees and expenses of which shall be paid by the Company.

 

    	 	6	 

     

    

 

“Warrants” means the Series A Warrants
and the Series B Warrants.

 

“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 $2,050,000 in principal amount of the Debentures. 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
Debenture 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 EGS 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
legal opinion of Company Counsel, substantially in the form of Exhibit D attached hereto;

 

(iii)         a
Debenture with a principal amount equal to such Purchaser’s Subscription Amount, registered in the name of such Purchaser;

 

(iv)         a
Series A Warrant registered in the name of such Purchaser to purchase up to a number of shares of Common Stock equal to 150% of
such Purchaser’s Conversion Shares on the Closing Date, with an exercise price equal to $1.84, subject to adjustment therein;

 

    	 	7	 

     

    

 

(v)         a copy
of the irrevocable instructions to the Transfer Agent instructing the Transfer Agent to deliver a certificate evidencing a number
of Shares equal to 1,166,113 for each $2,050,000 of Subscription Amount, registered in the name of such Purchaser;

 

(vi)        the
Company shall have provided each Purchaser with the Company’s wire instructions on Company letterhead, executed by an authorized
signatory of the Company;

 

(vii)        the
Security Agreement, duly executed by the Company, along with all of the Security Documents, including the Subsidiary Guarantee,
duly executed by the parties thereto, the Pledged Securities and corresponding stock powers, provided that the Subsidiary Guarantee
shall be delivered within twenty (20) calendar days following the Closing Date; and

 

(viii)      
the Registration Rights Agreement duly executed by the Company.

 

(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;

 

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

 

(iii)
        the Security Agreement duly executed by such Purchaser; and

 

(iv)
        the Registration Rights Agreement duly executed by such Purchaser.

 

		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 (or, to the extent representations or warranties are qualified by materiality or Material
Adverse Effect, in all respects) the Closing Date of the representations and warranties of the Purchasers contained herein (unless
such representation or warranty is expressly stated to have been made 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

 

    	 	8	 

     

    

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

ARTICLE III.

REPRESENTATIONS AND WARRANTIES

 

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

 

    	 	9	 

     

    

 

(a)          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 material 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 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.

 

(b)           Authorization;
Enforcement.

 

(i)         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 to which it is a party 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.

 

    	 	10	 

     

    

 

(ii)         With respect to
the Subsidiary Guarantee, the Applicable Subsidiary has the requisite corporate power and authority to enter into and to consummate
the transactions contemplated by such agreement and otherwise to carry out its obligations thereunder. The execution and delivery
of the Subsidiary Guarantee and the consummation by the Company of the transactions contemplated thereby have been duly authorized
by all necessary action on the part of the Company, and no further action is required by the Applicable Subsidiary, its managers
or its members in connection therewith. The Subsidiary Guarantee has been (or upon delivery will have been) duly executed by the
Applicable Subsidiary and, when delivered in accordance with the terms thereof, will constitute the valid and binding obligation
of the respective Applicable Subsidiary enforceable against such Applicable Subsidiary in accordance with its terms, except (A)
as listed by general equitable principals and applicable bankruptcy, insolvency, reorganization, moratorium and other laws of general
application affecting enforcement of creditors’ rights generally, (B) as limited by laws relating to the availability of
specific performance, injunctive relief or other equitable remedies and (C) insofar as indemnification and contribution provisions
may be limited by applicable law.

 

(c)           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 (other than pursuant to the Transaction Documents), or give to others
any rights of termination, amendment, anti-dilution or similar adjustments, 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.

 

(d)          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 4.5 of this Agreement, (ii) the filing with the Commission pursuant to the Registration
Rights Agreement, (iii) the notice and/or application(s) to each applicable Trading Market for the issuance and sale of the Securities
and the listing of the Shares, Conversion Shares and Warrant Shares for trading thereon in the time and manner required thereby,
(iv) the filing of Form D with the Commission and such filings as are required to be made under applicable state securities laws
and (v) Shareholder Approval (collectively, the “Required Approvals”).

    	 	11	 

     

    

 

(e)           Issuance
of the Securities. The Securities are duly authorized and, when issued and paid for in accordance with the applicable Transaction
Documents, will be duly and validly issued, fully paid and nonassessable, free and clear of all Liens imposed by the Company other
than restrictions on transfer provided for in the Transaction Documents and applicable law.
The Company has reserved from its duly authorized capital stock a number of shares of Common Stock for issuance of the Underlying
Shares at least equal to the Required Minimum on the date hereof. 

 

(f)            Capitalization.
Except as set forth on Schedule 3.1(f), as of the date hereof, 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. The
issuance and sale of the Securities will not obligate the Company or any Subsidiary to issue shares of Common Stock or other securities
to any Person (other than the Purchasers). Except as set forth on Schedule 3.1(f), as of the date hereof, there are no outstanding
securities or instruments of the Company or any Subsidiary with any provision that adjusts the exercise, conversion, exchange or
reset price of such security or instrument upon an issuance of securities by the Company or any Subsidiary. Except as set forth
on Schedule 3.1(f), as of the date hereof, there are no outstanding securities or instruments of the Company or any Subsidiary
that contain any redemption or similar provisions, and there are no contracts, commitments, understandings or arrangements by which
the Company or any Subsidiary is or may become bound to redeem a security of the Company or such Subsidiary. Except as set forth
on Schedule 3.1(f), as of the date hereof, the Company does not have any stock appreciation rights or “phantom stock”
plans or agreements or any similar plan or agreement. As of the date hereof, 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. As of the date hereof, no further approval or authorization of any stockholder, the Board
of Directors or others is required for the issuance and sale of the Securities. As of the date hereof, 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.

 

(g)           SEC
Reports; Financial Statements. The Company has filed all reports, schedules, forms, statements and other documents required
to be filed by the Company under the Securities Act and the Exchange Act, including pursuant to Section 13(a) or 15(d) thereof,
for the two years preceding the date hereof (or such shorter period as the Company was required by law or regulation to file such
material) (the foregoing materials, including the exhibits thereto and documents incorporated by reference therein, being collectively
referred to herein as the “SEC Reports”) on a timely basis or has received a valid extension of such time of
filing and has filed any such SEC Reports prior to the expiration of any such extension. As of their respective dates, the SEC
Reports complied in all material respects with the requirements of the Securities Act and the Exchange Act, as applicable, and
none of the SEC Reports, when filed, contained any untrue statement of a material fact or omitted to state a material fact required
to be stated therein or necessary in order to make the statements therein, in the light of the circumstances under which
they were made, not misleading. The 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 in
accordance with GAAP 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.

    	 	12	 

     

    

 

(h)          Material
Changes; Undisclosed Events, Liabilities or Developments. Since the date of the latest audited financial statements
included within the SEC Reports, except as set forth on Schedule 3.1(h), (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 material 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 materially 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. Except for the issuance of the Securities contemplated by this Agreement or
as set forth on Schedule 3.1(h), 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, 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 one (1) Trading Day prior to the date that this representation is made

 

(i)           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 therefor in accordance with GAAP
and, the payment of which is neither delinquent nor subject to penalties and (iii) Liens that could not reasonably be expected
to result in a Material Adverse Effect. 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.

 

    	 	13	 

     

    

 

(j)            Sarbanes-Oxley;
Internal Accounting Controls. The Company and the Subsidiaries are in compliance in all material respects 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.

 

(k)           Certain
Fees. No brokerage or finder’s fees or commissions are or will be payable by the Company or any Subsidiaries 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.

 

(l)            Private
Placement. Assuming the accuracy of the Purchasers’ representations and warranties set forth in Section 3.2, no registration
under the Securities Act is required for the offer and sale of the Securities by the Company to the Purchasers as contemplated
hereby. The issuance and sale of the Securities hereunder does not contravene the rules and regulations of the Trading Market.

 

(m)          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.

 

(n)           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. 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, including the Disclosure Schedules to this Agreement, is true and
correct in all material respects and does not contain any untrue statement of a material fact or omit to state any material
fact necessary in order to make the statements made therein, in the light of the circumstances under which they were made, not
misleading. 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 the 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.

 

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(o)          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 (i) the Securities Act which would require the registration
of any such securities under the Securities Act, or (ii) any applicable shareholder approval provisions of any Trading Market on
which any of the securities of the Company are listed or designated.

 

(p)          Solvency.
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. Schedule 3.1(p) sets forth as of the date hereof all outstanding secured and unsecured
Indebtedness of the Company, or for which the Company has commitments. The Company is not in default as of the date hereof with
respect to any Indebtedness.

 

(q)    
     Seniority. As of the Closing Date, no Indebtedness or other claim against the Company will be senior
to the Debentures in right of payment, whether with respect to interest or upon liquidation or dissolution, or otherwise,
other than indebtedness secured by purchase money security interests (which is senior only as to underlying assets covered
thereby) and capital lease obligations (which is senior only as to the property covered thereby).

 

(r)           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.

 

    	 	15	 

     

    

 

(s)           Acknowledgment
Regarding Purchaser’s Trading Activity. Anything in this Agreement or elsewhere herein to the contrary notwithstanding
(except for Sections 3.2(f) and 4.11 hereof), it is understood and acknowledged by the Company that: (i) none of the Purchasers
has been asked by the Company to agree, nor has any Purchaser agreed, to desist from purchasing or selling, long and/or short,
securities of the Company, or “derivative” securities based on securities issued by the Company or to hold the
Securities for any specified term, (ii) past or future open market or other transactions by any Purchaser, specifically including,
without limitation, Short Sales or “derivative” transactions, before or after the closing of this or future private
placement transactions, may negatively impact the market price of the Company’s publicly-traded securities, (iii) any Purchaser,
and counter-parties in “derivative” transactions to which any such Purchaser is a party, directly or indirectly, may
presently have a “short” position in the Common Stock and (iv) each Purchaser shall not be deemed to have any affiliation
with or control over any arm’s length counter-party in any “derivative” transaction. The Company further understands
and acknowledges that (y) one or more Purchasers may engage in hedging activities at various times during the period that the Securities
are outstanding, including, without limitation, during the periods that the value of the Underlying Shares deliverable with respect
to Securities are being determined, and (z) such hedging activities (if any) could reduce the value of the existing stockholders'
equity interests in the Company at and after the time that the hedging activities are being conducted. The Company acknowledges
that such aforementioned hedging activities do not constitute a breach of any of the Transaction Documents.

 

(t)           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, if any, in connection with the placement of the Securities.

 

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

 

    	 	16	 

     

    

 

(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
the Transaction Documents and otherwise to carry out its obligations hereunder and thereunder. The execution and delivery of the
Transaction Documents and performance by such Purchaser of the transactions contemplated by the Transaction Documents have been
duly authorized by all necessary corporate, partnership, limited liability company or similar action, as applicable, on the part
of such Purchaser. Each Transaction Document to which it is a party has been duly executed
by such Purchaser, and when delivered by such Purchaser in accordance with the terms hereof, will constitute the valid and legally
binding obligation of such Purchaser, enforceable against it in accordance with its terms, except (i) as limited by general equitable
principles and applicable bankruptcy, insolvency, reorganization, moratorium and other laws of general application affecting enforcement
of creditors’ rights generally, (ii) as limited by laws relating to the availability of specific performance, injunctive
relief or other equitable remedies and (iii) insofar as indemnification and contribution provisions may be limited by applicable
law.

 

(b)           Own Account.
Such Purchaser understands that the Securities are “restricted securities” and have not been registered under the Securities
Act or any applicable state securities law and is acquiring the Securities as principal for its own account and not with a view
to or for distributing or reselling such Securities or any part thereof in violation of the Securities Act or any applicable state
securities law, has no present intention of distributing any of such Securities in violation of the Securities Act or any applicable
state securities law and has no direct or indirect arrangement or understandings with any other persons to distribute or regarding
the distribution of such Securities in violation of the Securities Act or any applicable state securities law (this representation
and warranty not limiting such Purchaser’s right to sell the Securities pursuant to the Registration Statement or otherwise
in compliance with applicable federal and state securities laws). Such Purchaser is acquiring the Securities hereunder in the ordinary
course of its business.

 

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

 

(d)           Experience
of Such Purchaser. Such Purchaser, either alone or together with its representatives, has such knowledge, sophistication and
experience in business and financial matters so as to be capable of evaluating the merits and risks of the prospective investment
in the Securities, and has so evaluated the merits and risks of such investment. Such Purchaser is aware of the Company’s
business affairs and financial condition and has received or has had full access to all the information it considers necessary
or appropriate to make an informed investment decision with respect to the Securities. Such Purchaser is able to bear the economic
risk of an investment in the Securities and, at the present time, is able to afford a complete loss of such investment.

 

    	 	17	 

     

    

 

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

 

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

 

The Company acknowledges and agrees that
the representations contained in this Section 3.2 shall not modify, amend or affect such Purchaser’s right to rely on the
Company’s representations and warranties contained in this Agreement or any representations and warranties contained in any
other Transaction Document or any other document or instrument executed and/or delivered in connection with this Agreement or the
consummation of the transactions contemplated hereby. Notwithstanding the foregoing, for the avoidance of doubt, nothing contained
herein shall constitute a representation or warranty, or preclude any actions, with respect to locating or borrowing shares in
order to effect Short Sales or similar transactions in the future.

 

ARTICLE IV.

OTHER AGREEMENTS OF THE PARTIES

 

4.1         Transfer
Restrictions.

 

    	 	18	 

     

    

 

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

 

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

 

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

 

The Company acknowledges
and agrees that a Purchaser may from time to time pledge pursuant to a bona fide margin agreement with a registered broker-dealer
or grant a security interest in some or all of the Securities to a financial institution that is an “accredited investor”
as defined in Rule 501(a) under the Securities Act and, if required under the terms of such arrangement, such Purchaser may transfer
pledged or secured Securities to the pledgees or secured parties. Such a pledge or transfer would not be subject to approval of
the Company and no legal opinion of legal counsel of the pledgee, secured party or pledgor shall be required in connection therewith.
Further, no notice shall be required of such pledge. At the appropriate Purchaser’s expense, the Company will execute and
deliver such reasonable documentation as a pledgee or secured party of Securities may reasonably request in connection with a pledge
or transfer of the Securities, including, if the Securities are subject to registration pursuant to the Registration
Rights Agreement, the preparation and filing of any required prospectus supplement under Rule 424(b)(3) under the Securities Act
or other applicable provision of the Securities Act to appropriately amend the list of Selling Stockholders (as defined in the
Registration Rights Agreement) thereunder.

 

    	 	19	 

     

    

 

(c)           Certificates
evidencing the Shares and the Underlying Shares shall not contain any legend (including the legend set forth in Section 4.1(b)
hereof): (i) while a registration statement (including the Registration Statement) covering the resale of such security is effective
under the Securities Act, (ii) following any sale of such Shares or Underlying Shares pursuant to Rule 144, (iii) if such Shares
or Underlying Shares are eligible for sale under Rule 144 or (iv) if such legend is not required under applicable requirements
of the Securities Act (including judicial interpretations and pronouncements issued by the staff of the Commission). The Company
shall cause its counsel to issue a legal opinion to the Transfer Agent or the Purchaser if required by the Transfer Agent to effect
the removal of the legend hereunder, or if requested by a Purchaser, respectively. If all or any portion of a Debenture is converted
or Warrant is exercised at a time when there is an effective registration statement to cover the resale of the Underlying Shares,
or if such Underlying Shares may be sold under Rule 144 or if such legend is not otherwise required under applicable requirements
of the Securities Act (including judicial interpretations and pronouncements issued by the staff of the Commission) then such Underlying
Shares shall be issued free of all legends. The Company agrees that at such time as such legend is no longer required under this
Section 4.1(c), it will, no later than the earlier of (i) two (2) Trading Days and (ii) the number of Trading Days comprising the
Standard Settlement Period (as defined below) following the delivery by a Purchaser to the Company or the Transfer Agent of a certificate
representing the Shares or the Underlying Shares, as applicable, issued with a restrictive legend (such date, the “Legend
Removal Date”), deliver or cause to be delivered to such Purchaser a certificate representing such shares that is free
from all restrictive and other legends. The Company may not make any notation on its records or give instructions to the Transfer
Agent that enlarge the restrictions on transfer set forth in this Section 4. Certificates for Shares and Underlying Shares subject
to legend removal hereunder shall be transmitted by the Transfer Agent to the Purchaser by crediting the account of the Purchaser’s
prime broker with the Depository Trust Company System as directed by such Purchaser. As used herein, “Standard Settlement
Period” means the standard settlement period, expressed in a number of Trading Days, on the Company’s primary Trading
Market with respect to the Common Stock as in effect on the date of delivery of a certificate representing Shares or Underlying
Shares, as applicable, issued with a restrictive legend.

 

(d)           In
addition to such Purchaser’s other available remedies, if the Company fails to (a) issue and deliver (or cause to be delivered)
to a Purchaser by the Legend Removal Date a certificate representing the Securities so delivered to the Company by such Purchaser
that is free from all restrictive and other legends and (b) if after the Legend Removal Date such Purchaser purchases (in an open
market transaction or otherwise) shares of Common Stock to deliver in satisfaction of a sale by such Purchaser of all or any portion
of the number of shares of Common Stock, or a sale of a number of shares of Common Stock equal to all or any portion of the number
of shares of Common Stock that such Purchaser anticipated receiving from the Company without any restrictive legend, then, an amount
equal to the excess of such Purchaser’s total purchase price (including brokerage commissions and other out-of-pocket expenses,
if any) for the shares of Common Stock so purchased (including brokerage commissions and other out-of-pocket expenses, if any)
(the “Buy-In Price”) over the product of (A) such number of Shares or Underlying Shares that the Company was
required to deliver to such Purchaser by the Legend Removal Date multiplied by (B) the lowest closing sale price of the Common
Stock on any Trading Day during the period commencing on the date of the delivery by such Purchaser to the Company of the applicable
Shares or Underlying Shares (as the case may be) and ending on the date of such delivery and payment under this clause (ii).

 

    	 	20	 

     

    

 

(e)           Each
Purchaser, severally and not jointly with the other Purchasers, agrees with the Company that such Purchaser will sell any Securities
pursuant to either the registration requirements of the Securities Act, including any applicable prospectus delivery requirements,
or an exemption therefrom, and that if Securities are sold pursuant to a Registration Statement, they will be sold in compliance
with the plan of distribution set forth therein, and acknowledges that the removal of the restrictive legend from certificates
representing Securities as set forth in this Section 4.1 is predicated upon the Company’s reliance upon this understanding.

 

		4.2	Furnishing of Information; Public Information.

 

(a)           Until
the earliest of the time that (i) no Purchaser owns Securities or (ii) the Warrants have expired, the Company covenants to maintain
the registration of the Common Stock under Section 12(b) or 12(g) of the Exchange Act and 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.

 

(b)          At
any time during the period commencing from the six (6) month anniversary of the date hereof and ending at such time that all of
the Securities may be sold without the requirement for the Company to be in compliance with Rule 144(c)(1) and otherwise without
restriction or limitation pursuant to Rule 144, if the Company (i) shall fail for any reason to satisfy the current public information
requirement under Rule 144(c) or (ii) has ever been an issuer described in Rule 144 (i)(1)(i) or becomes such an issuer in the
future, and the Company shall fail to satisfy any condition set forth in Rule 144(i)(2) (a “Public Information Failure”)
then, in addition to such Purchaser’s other available remedies, the Company shall pay to a Purchaser, in cash, as partial
liquidated damages and not as a penalty, by reason of any such delay in or reduction of its ability to sell the Securities, an
amount in cash equal to two percent (2.0%) of the aggregate Subscription Amount of such Purchaser’s Securities on the day
of a Public Information Failure and on every thirtieth (30th) day (pro rated for
periods totaling less than thirty days) thereafter until the earlier of (a) the date such Public Information Failure is cured and
(b) such time that such public information is no longer required for the Purchasers to transfer the Shares or the Underlying Shares
pursuant to Rule 144. The payments to which a Purchaser shall be entitled pursuant to this Section 4.2(b) are referred to herein
as “Public Information Failure Payments.” Public Information Failure Payments shall be paid on the earlier of
(i) the last day of the calendar month during which such Public Information Failure Payments are incurred and (ii) the third (3rd)
Business Day after the event or failure giving rise to the Public Information Failure Payments is cured. In the event that the
Company fails to make Public Information Failure Payments in a timely manner, such Public Information Failure Payments shall bear
interest at the rate of 1.5% per month (prorated for partial months) until paid in full. Nothing herein shall limit such Purchaser’s
right to pursue actual damages for the Public Information Failure, and such Purchaser shall have the right to pursue all remedies
available to it at law or in equity including, without limitation, a decree of specific performance and/or injunctive relief.

 

    	 	21	 

     

    

 

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

 

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

 

4.5         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. From and after the issuance of such press release, the Company represents to the Purchasers that it shall have publicly
disclosed all material, non-public information delivered to any of the Purchasers by the Company or any of its Subsidiaries, or
any of their respective officers, directors, employees or agents in connection with the transactions contemplated by the Transaction
Documents. In addition, effective upon the issuance of such press release, the Company acknowledges and agrees that any and all
confidentiality or similar obligations under any agreement, whether written or oral, between the Company, any of its Subsidiaries
or any of their respective officers, directors, agents, employees or Affiliates on the one hand, and any of the Purchasers or any
of their Affiliates on the other hand, shall terminate. Notwithstanding the foregoing, the Company shall not publicly disclose
the name of any Purchaser, or include the name of any Purchaser in any filing with the Commission or any regulatory agency or Trading
Market, without the prior written consent of such Purchaser, except (a) as required by federal securities law in connection with
(i) any registration statement contemplated by the Registration Rights Agreement and (ii) the filing of final Transaction Documents
with the Commission and (b) to the extent such disclosure is required by law or Trading Market regulations, in which case the Company
shall provide the Purchasers with prior notice of such disclosure permitted under this clause (b).

 

    	 	22	 

     

    

 

4.6          Non-Public
Information. Except with respect to the material terms and conditions of the transactions contemplated by the Transaction Documents,
which shall be disclosed pursuant to Section 4.5, the Company covenants and agrees that neither it, nor any other Person acting
on its behalf will provide any Purchaser or its agents or counsel with any information that constitutes, or the Company reasonably
believes constitutes, material non-public information, unless prior thereto such Purchaser shall have consented to the receipt
of such information and agreed with the Company to keep such information confidential. The Company understands and confirms that
each Purchaser shall be relying on the foregoing covenant in effecting transactions in securities of the Company. To the extent
that the Company delivers any material, non-public information to a Purchaser without such Purchaser’s consent, the Company
hereby covenants and agrees that such Purchaser shall not have any duty of confidentiality to the Company, any of its Subsidiaries,
or any of their respective officers, directors, agents, employees or Affiliates, or a duty to the Company, any of its Subsidiaries
or any of their respective officers, directors, agents, employees or Affiliates not to trade on the basis of, such material, non-public
information, provided that the Purchaser shall remain subject to applicable law. To the extent that any notice provided pursuant
to any Transaction Document constitutes, or contains, material, non-public information regarding the Company or any Subsidiaries,
the Company shall simultaneously file such notice with the Commission pursuant to a Current Report on Form 8-K. The Company understands
and confirms that each Purchaser shall be relying on the foregoing covenant in effecting transactions in securities of the Company.

 

4.7         Use
of Proceeds. Except as set forth on Schedule 4.7 attached hereto, the Company shall use the net proceeds from the sale
of the Securities hereunder for working capital purposes and shall not use such proceeds: (a) for the satisfaction of any portion
of the Company’s debt (other than payment of trade payables in the ordinary course of the Company’s
business and prior practices), (b) for the redemption of any Common Stock or Common Stock Equivalents, (c) for the settlement of
any outstanding litigation or (d) in violation of FCPA or OFAC regulations. 

 

    	 	23	 

     

    

 

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 solely based upon a material 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 is finally judicially
determined to constitute fraud, gross negligence or willful misconduct). 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 and Listing of Securities.

 

(a)          The
Company shall maintain a reserve of the Required Minimum from its duly authorized shares of Common Stock for issuance pursuant
to the Transaction Documents in such amount as may then be required to fulfill its obligations in full under the Transaction Documents.

 

(b)           If,
on the last day of each fiscal quarter, the number of authorized but unissued (and otherwise unreserved) shares of Common Stock
is less than the Required Minimum on such date, then the Board of Directors shall use commercially reasonable efforts
to amend the Company’s certificate or articles of incorporation to increase the number of authorized but unissued shares
of Common Stock to at least the Required Minimum at such time, as soon as possible and in any event not later than the 75th day
after such date.

 

    	 	24	 

     

    

 

(c)         
The Company shall, if applicable: (i) in the time and manner required by the principal Trading Market, prepare and file with such
Trading Market an additional shares listing application covering a number of shares of Common Stock at least equal to the Required
Minimum on the date of such application, (ii) take all steps necessary to cause such shares of Common Stock to be approved for
listing or quotation on such Trading Market as soon as possible thereafter, (iii) provide to the Purchasers evidence of such listing
or quotation and (iv) maintain the listing or quotation of such Common Stock on any date at least equal to the Required Minimum
on such date on such Trading Market or another Trading Market. The Company agrees to maintain the eligibility of the Common Stock
for electronic transfer through the Depository Trust Company or another established clearing corporation, including, without limitation,
by timely payment of fees to the Depository Trust Company or such other established clearing corporation in connection with such
electronic transfer. In addition, the Company shall hold a special meeting of shareholders (which may also be at the annual meeting
of shareholders) at the earliest practical date after the date on which the number of shares of Common Stock issuable pursuant
to the Transaction Documents on a fully converted or exercised basis (ignoring for such purposes any conversion or exercise limitations
therein) exceeds 18% of the issued and outstanding shares of Common Stock on the Closing Date for the purpose of obtaining Shareholder
Approval, with the recommendation of the Company’s Board of Directors that such proposal be approved, and the Company
shall solicit proxies from its shareholders in connection therewith in the same manner as all other management proposals in such
proxy statement and all management-appointed proxyholders shall vote their proxies in favor of such proposal. The Company shall
use its reasonable best efforts to obtain such Shareholder Approval. If the Company does not obtain Shareholder Approval at the
first meeting, the Company shall call a meeting every four months thereafter to seek Shareholder Approval until the earlier of
the date Shareholder Approval is obtained or the Debentures are no longer outstanding.

 

4.10       Subsequent
Equity Sales. Unless Shareholder Approval has been obtained and deemed effective, neither the Company nor any Subsidiary shall
make any issuance whatsoever of Common Stock or Common Stock Equivalents which would cause any adjustment of the Conversion Price
and/or the Exercise Price to the extent that the holders of Debentures and Warrants would not be permitted, pursuant to Section
4(e) of the Debentures or Section 2(f) of the Warrants, as applicable, to convert their respective outstanding Debentures in full
and exercise their respective Warrants in full, ignoring for such purposes the other conversion and exercise limitations therein.
Any Purchaser shall be entitled to obtain injunctive relief against the Company to preclude any such issuance, which remedy shall
be in addition to any right to collect damages. Notwithstanding the foregoing, this Section 4.10 shall not apply in respect of
an Exempt Issuance.

 

    	 	25	 

     

    

 

4.11       Certain
Transactions and Confidentiality. Each Purchaser, severally and not jointly with the other Purchasers, covenants that neither
it, nor any Affiliate acting on its behalf or pursuant to any understanding with it will execute any purchases or sales, including
Short Sales, of any of the Company’s securities during the period commencing with the execution of this Agreement and ending
at such time that the transactions contemplated by this Agreement are first publicly announced pursuant to the initial press release
as described in Section 4.5. Each Purchaser, severally and not jointly with the other Purchasers, covenants that until such time
as the transactions contemplated by this Agreement are publicly disclosed by the Company pursuant to the initial press release
as described in Section 4.5, such Purchaser will maintain the confidentiality of the existence and terms of this transaction and
the information included in the Disclosure Schedules. Notwithstanding the foregoing, and notwithstanding anything contained in
this Agreement to the contrary, the Company expressly acknowledges and agrees that (i) no Purchaser makes any representation, warranty
or covenant hereby that it will not engage in effecting transactions in any securities of the Company after the time that the transactions
contemplated by this Agreement are first publicly announced pursuant to the initial press release as described in Section 4.5,
(ii) no Purchaser shall be restricted or prohibited from effecting any transactions in any securities of the Company in accordance
with applicable securities laws from and after the time that the transactions contemplated by this Agreement are first publicly
announced pursuant to the initial press release as described in Section 4.5 and (iii) no Purchaser shall have any duty of confidentiality
or duty not to trade in the securities of the Company to the Company or its Subsidiaries after the issuance of the initial press
release as described in Section 4.5. Notwithstanding the foregoing, in the case of a Purchaser that is a multi-managed investment
vehicle whereby separate portfolio managers manage separate portions of such Purchaser’s assets and the portfolio managers
have no direct knowledge of the investment decisions made by the portfolio managers managing other portions of such Purchaser’s
assets, the covenant set forth above shall only apply with respect to the portion of assets managed by the portfolio manager that
made the investment decision to purchase the Securities covered by this Agreement.

 

4.12       Release
of Subsidiary Guarantee and Pledged Securities. The Company and each Purchaser hereby covenant and agree that the Company shall
have the right to require each Purchaser to deliver (i) a release of the Subsidiary Guarantee delivered by the Applicable Subsidiary
hereunder and (ii) a release of each Purchaser’s security interest and Lien in and to the Pledged Securities of the Applicable
Subsidiary that were granted by the Company pursuant to the Security Agreement (collectively, the “Applicable Subsidiary
Release”), provided that the Company delivers a notice requiring the Applicable Subsidiary Release (the “Applicable
Subsidiary Release Notice” and the date of such notice, the “Applicable Subsidiary Release Notice Date”)
to the Purchasers and delivers to the Purchasers certificates evidencing an aggregate of 250,000 shares of Common Stock (subject
to adjustment for reverse and forward stock splits, recapitalizations and similar transactions) (the “Additional Shares”)
within five (5) Trading Days of the Applicable Subsidiary Release Notice Date, which Additional Shares
shall be delivered to the Purchasers pro-rata based on initial Subscription Amounts hereunder (for purposes of clarity, if there
is only one Purchaser hereunder, such Purchaser would receive full 250,000 Additional Shares in connection with an Applicable Subsidiary
Release). On or prior to the date on which the Company delivers the Additional Shares to such Purchaser, such Purchaser shall deliver
or cause to be delivered the Applicable Subsidiary Release. The Additional Shares shall be deemed to be “Shares”
under this Agreement and shall be subject to legend removal pursuant to Section 4.1 herein. For purposes of clarity, if the issuance
and delivery of the Additional Shares to a Purchaser causes such Purchaser’s beneficial ownership to exceed the Beneficial
Ownership Limitation (as defined in the Debentures) or the issuance of Additional Shares is not in compliance with the Issuable
Maximum (as defined in the Debentures and Warrants), the Company shall deliver such number of Additional Shares that are in compliance
with such Purchaser’s Beneficial Ownership Limitation and in compliance with the Issuable Maximum and to hold in abeyance
any additional Additional Shares until such time as such Purchaser delivers notice to the Company for the issuance of additional
Additional Shares in compliance with the Beneficial Ownership Limitation and until such time as such issuance is in compliance
with the Issuable Maximum or Shareholder Approval has been obtained.

 

    	 	26	 

     

    

 

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 the fifth (5th) Trading Day following the date
hereof, 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. At the Closing, the Company has agreed to reimburse ID Venturas 7 LLC (“IDV”) for its legal
fees and expenses up to $50,000. Accordingly, in lieu of the foregoing payment, the aggregate amount that IDV shall pay for the
Securities at the Closing shall be reduced by $50,000 in lieu thereof. The Company shall deliver to each Purchaser, prior to the
Closing, a completed and executed copy of the Closing Statement, attached hereto as Annex A. 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.

 

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

 

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

 

    	 	27	 

     

    

 

5.5       
Amendments; Waivers. No provision of this Agreement may be waived, modified, supplemented or amended except in a written
instrument signed, in the case of an amendment, by the Company and Purchasers which purchased at least 50.1% in interest of the
Debentures based on the initial Subscription Amounts hereunder or, in the case of a waiver, by the party against whom enforcement
of any such waived provision is sought. No waiver of any default with respect to any provision, condition or requirement of this
Agreement shall be deemed to be a continuing waiver in the future or a waiver of any subsequent default or a waiver of any other
provision, condition or requirement hereof, nor shall any delay or omission of any party to exercise any right hereunder in any
manner impair the exercise of any such right. Any amendment effected in accordance with this Section 5.5 shall be binding upon
each Purchaser and holder of Securities and the Company.

 

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

 

5.7         Successors
and Assigns. This Agreement shall be binding upon and inure to the benefit of the parties and their successors and permitted
assigns. The Company may not assign this Agreement or any rights or obligations hereunder without the prior written consent of
each Purchaser (other than by merger). Any Purchaser may assign any or all of its rights under this Agreement to any Person with
the prior written consent of the Company, 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”; provided, however,
notwithstanding the foregoing, in connection with any assignment of any or all rights under this Agreement to an Affiliate of a
Purchaser, such assignment shall not require the consent of the Company.

 

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

 

    	 	28	 

     

    

 

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

 

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

 

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

 

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

 

    	 	29	 

     

    

 

5.13       Rescission
and Withdrawal Right. Notwithstanding anything to the contrary contained in (and without limiting any similar provisions of)
any of the other Transaction Documents, whenever any Purchaser exercises a right, election, demand or option under a Transaction
Document and the Company does not timely perform its related obligations within the periods therein provided, then such Purchaser
may rescind or withdraw, in its sole discretion from time to time upon written notice to the Company, any relevant notice, demand
or election in whole or in part without prejudice to its future actions and rights; provided, however, that, in the
case of a rescission of a conversion of a Debenture or exercise of a Warrant, the applicable Purchaser shall be required to return
any shares of Common Stock subject to any such rescinded conversion or 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).

 

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

 

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

 

5.16       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       Usury.
To the extent it may lawfully do so, the Company hereby agrees not to insist upon or plead or in any manner whatsoever claim, and
will resist any and all efforts to be compelled to take the benefit or advantage of, usury laws wherever enacted, now or at any
time hereafter in force, in connection with any Action or Proceeding that may be brought by any Purchaser in order to enforce any
right or remedy under any Transaction Document. Notwithstanding any provision to the contrary contained in any Transaction Document,
it is expressly agreed and provided that the total liability of the Company under the Transaction Documents for payments in the
nature of interest shall not exceed the maximum lawful rate authorized under applicable law (the “Maximum Rate”),
and, without limiting the foregoing, in no event shall any rate of interest or default interest, or both of them, when aggregated
with any other sums in the nature of interest that the Company may be obligated to pay under the Transaction Documents exceed such
Maximum Rate. It is agreed that if the maximum contract rate of interest allowed by law and applicable to the Transaction Documents
is increased or decreased by statute or any official governmental action subsequent to the date hereof, the new maximum contract
rate of interest allowed by law will be the Maximum Rate applicable to the Transaction Documents from the effective date thereof
forward, unless such application is precluded by applicable law. If under any circumstances whatsoever, interest in excess of the
Maximum Rate is paid by the Company to any Purchaser with respect to indebtedness evidenced by the Transaction Documents, such
excess shall be applied by such Purchaser to the unpaid principal balance of any such indebtedness or be refunded to the Company,
the manner of handling such excess to be at such Purchaser’s election.

 

    	 	30	 

     

    

 

5.18       Independent
Nature of Purchasers’ Obligations and Rights. The obligations of each Purchaser under any Transaction Document are several
and not joint with the obligations of any other Purchaser, and no Purchaser shall be responsible in any way for the performance
or non-performance of the obligations of any other Purchaser under any Transaction Document. Nothing contained herein or in any
other Transaction Document, and no action taken by any Purchaser pursuant hereto or thereto, shall be deemed to constitute the
Purchasers as a partnership, an association, a joint venture or any other kind of entity, or create a presumption that the Purchasers
are in any way acting in concert or as a group with respect to such obligations or the transactions contemplated by the Transaction
Documents. Each Purchaser shall be entitled to independently protect and enforce its rights, including, without limitation, the
rights arising out of this Agreement or out of the other Transaction Documents, and it shall not be necessary for any other Purchaser
to be joined as an additional party in any Proceeding for such purpose. Each Purchaser has been represented by its own separate
legal counsel in its review and negotiation of the Transaction Documents. For reasons of administrative convenience only, each
Purchaser and its respective counsel have chosen to communicate with the Company through EGS. EGS does not represent all of the
Purchasers and only represents IDV. 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.

 

5.19       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.

 

5.20       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.

 

    	 	31	 

     

    

 

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

 

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

 

(Signature Pages Follow)

 

    	 	32	 

     

    

 

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.

 

	IDEANOMICS, INC.	 	Address for Notice:
	 	 	 
	By:	/s/ Alfred
    P. Poor	 	Email:	apoor@ideanomics.com
	Name:	Alfred P. Poor	 	Fax:	646-859-7695
	Title:	Chief Executive Officer	 	 	 
	 	 	 	 	 

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

 

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK

SIGNATURE PAGE FOR PURCHASER FOLLOWS]

    	 	 

     

    

 

[PURCHASER
SIGNATURE PAGES TO IDEX 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: 	ID Venturas 7 LLC	 
	 	 	 
	Signature of Authorized Signatory of Purchaser:	/s/ Antonio
    Ruiz-Gimenez	 
	 	 	 
	Name of Authorized Signatory: 	Antonio Ruiz-Gimenez	 
	 	 	 
	Title of Authorized Signatory:	Managing Partner	 
	 	 	 
	Email Address of Authorized Signatory: 	aruizg@atwpartners.com	 
	 	 	 
	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: 	$2,050,000.00	 
	 	 	 
	Shares: 	1,166,113	 
	 	 	 
	Warrant Shares: 	1,671,196	 
	 	 	 
	EIN Number:	 	 

 

[SIGNATURE
PAGES CONTINUE]

    	 	 

     

    

 

Annex A

 

CLOSING STATEMENT

 

Pursuant to the attached Securities Purchase
Agreement, dated as of the date hereto, the purchasers shall purchase up to $2,050,000 of Debentures, Shares and Warrants from
Ideanomics, Inc., a Nevada corporation (the “Company”). All funds will be wired into an account maintained by
the Company. All funds will be disbursed in accordance with this Closing Statement.

 

Disbursement Date: February ___, 2019

 

 

 

	I.  PURCHASE PRICE	 
	 	 
	Gross Proceeds to be Received	$
	 	 
	II. DISBURSEMENTS	 
	 	 
		$
		$
		$
		$
		$
	 	 
	Total Amount Disbursed:	$

 

WIRE INSTRUCTIONS:

Please see attached.

 

Acknowledged and agreed to this ___ day of February,
2019

 

	IDEANOMICS, INC.	 
	 	 
	By: 	        	 
	Name:	 
	Title:	 

 

    	 	35Exhibit 10.5

 

NEITHER THIS SECURITY NOR THE SECURITIES
INTO WHICH THIS SECURITY IS CONVERTIBLE HAVE BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION OR THE SECURITIES COMMISSION
OF ANY STATE IN RELIANCE UPON AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES
ACT”), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES
ACT OR PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES
ACT AND IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS. THIS SECURITY AND THE SECURITIES ISSUABLE UPON CONVERSION OF THIS
SECURITY MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT OR OTHER LOAN SECURED BY SUCH SECURITIES.

 

Original Issue Date: February 22, 2019

Original Conversion Price (subject to adjustment
herein): $1.84

 

$2,050,000.00

 

10% SENIOR SECURED CONVERTIBLE
DEBENTURE

DUE AUGUST 22, 2020

 

THIS 10% SENIOR SECURED
CONVERTIBLE DEBENTURE is one of a series of duly authorized and validly issued 10% Senior Secured Convertible Debentures of Ideanomics,
Inc., a Nevada corporation (the “Company”), having its principal place of business at 55 Broadway, 19th Floor,
New York, New York 10006, designated as its 10% Senior Secured Convertible Debenture due August 22, 2020 (this debenture, the “Debenture”
and, collectively with the other debentures of such series, the “Debentures”).

 

FOR VALUE RECEIVED,
the Company promises to pay to ID VENTURAS 7 LLC or its registered assigns (the “Holder”), or shall have paid
pursuant to the terms hereunder, the principal sum of $2,050,000.00 on August 22, 2020 (the “Maturity Date”)
or such earlier date as this Debenture is required or permitted to be repaid as provided hereunder, and to pay interest to the
Holder on the aggregate unconverted and then outstanding principal amount of this Debenture in accordance with the provisions hereof.
This Debenture is subject to the following additional provisions:

 

Section 1. Definitions.
For the purposes hereof, in addition to the terms defined elsewhere in this Debenture, (a) capitalized terms not otherwise defined
herein shall have the meanings set forth in the Purchase Agreement and (b) the following terms shall have the following meanings:

 

    	1

     

    

 

“Bankruptcy
Event” means any of the following events: (a) the Company or any Significant Subsidiary (as such term is defined in Rule
1-02(w) of Regulation S-X) thereof commences a case or other proceeding under any bankruptcy, reorganization, arrangement, adjustment
of debt, relief of debtors, dissolution, insolvency or liquidation or similar law of any jurisdiction relating to the Company or
any Significant Subsidiary thereof, (b) there is commenced against the Company or any Significant Subsidiary thereof any such case
or proceeding that is not dismissed within sixty (60) days after commencement, (c) the Company or any Significant Subsidiary thereof
is adjudicated insolvent or bankrupt or any order of relief or other order approving any such case or proceeding is entered, (d)
the Company or any Significant Subsidiary thereof suffers any appointment of any custodian or the like for it or any substantial
part of its property that is not discharged or stayed within sixty (60) calendar days after such appointment, (e) the Company or
any Significant Subsidiary thereof makes a general assignment for the benefit of creditors, (f) the Company or any Significant
Subsidiary thereof calls a meeting of its creditors with a view to arranging a composition, adjustment or restructuring of its
debts, (g) the Company or any Significant Subsidiary thereof admits in writing that it is generally unable to pay its debts as
they become due, or (h) the Company or any Significant Subsidiary thereof, by any act or failure to act, expressly indicates its
consent to, approval of or acquiescence in any of the foregoing or takes any corporate or other action for the purpose of effecting
any of the foregoing.

 

“Base Conversion Price”
shall have the meaning set forth in Section 5(b).

 

“Beneficial
Ownership Limitation” shall have the meaning set forth in Section 4(d).

 

“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.

 

“Buy-In” shall
have the meaning set forth in Section 4(c)(v).

 

“Change of
Control Transaction” means the occurrence after the date hereof of any of (a) an acquisition after the date hereof by
an individual or legal entity or “group” (as described in Rule 13d-5(b)(1) promulgated under the Exchange Act) of effective
control (whether through legal or beneficial ownership of capital stock of the Company, by contract or otherwise) of in excess
of 50% of the voting securities of the Company (other than by means of conversion or exercise of the Debentures and the Securities
issued together with the Debentures), including, without limitation, through a purchase offer, tender offer or exchange offer (whether
by the Company or another Person) or a stock or share purchase agreement or other business combination (including, without limitation,
a reorganization, recapitalization, spin-off or scheme of arrangement), in one or more related transactions, (b) the Company merges
into or consolidates with any other Person, or any Person merges into or consolidates with the Company and, after giving effect
to such transaction, the stockholders of the Company immediately prior to such transaction own less than 50% of the aggregate voting
power of the Company or the successor entity of such transaction, (c) the Company sells or transfers all or substantially all of
its assets to another Person and the stockholders of the Company immediately prior to such transaction own less than 50% of the
aggregate voting power of the acquiring entity immediately after the transaction, or (d) the execution by the Company of an agreement
to which the Company is a party or by which it is bound, providing for any of the events set forth in clauses (a) through (c) above.

 

    	2

     

    

 

“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.

 

“Conversion”
shall have the meaning ascribed to such term in Section 4.

 

“Conversion Date”
shall have the meaning set forth in Section 4(a).

 

“Conversion Price”
shall have the meaning set forth in Section 4(b).

 

“Conversion
Schedule” means the Conversion Schedule in the form of Schedule 1 attached hereto.

 

“Conversion
Shares” means, collectively, the shares of Common Stock issuable upon conversion of this Debenture in accordance with
the terms hereof.

 

“Debenture Register”
shall have the meaning set forth in Section 2(c).

 

“Dilutive Issuance”
shall have the meaning set forth in Section 5(b).

 

“Dilutive Issuance Notice”
shall have the meaning set forth in Section 5(b).

 

“Effectiveness
Period” shall have the meaning set forth in the Registration Rights Agreement.

 

“Equity
Conditions” means, during the period in question, (a) the Company shall have duly honored all conversions and redemptions
scheduled to occur or occurring by virtue of one or more Notices of Conversion of the Holder, if any, (b) the Company shall have
paid all liquidated damages and other amounts owing to the Holder in respect of this Debenture, (c) with respect to Section 2 only,
(i) there is an effective Registration Statement pursuant to which the Holder is permitted to utilize the prospectus thereunder
to resell all of the shares of Common Stock issuable pursuant to the Transaction Documents (and the Company believes, in good faith,
that such effectiveness will continue uninterrupted for the foreseeable future) or (ii) all of the Conversion Shares issuable pursuant
to the Transaction Documents (and shares issuable in lieu of cash payments of interest) may be resold pursuant to Rule 144 without
volume or manner-of-sale restrictions or current public information requirements as determined by the counsel to the Company as
set forth in a written opinion letter to such effect, addressed and acceptable to the Transfer Agent and the Holder, (d) the Common
Stock is trading on a Trading Market and all of the shares issuable pursuant to the Transaction Documents are listed or
quoted for trading on such Trading Market (and the Company believes, in good faith, that trading of the Common Stock on a Trading
Market will continue uninterrupted for the foreseeable future), (e) there is a sufficient number of authorized but unissued and
otherwise unreserved shares of Common Stock for the issuance of all of the shares then issuable pursuant to the Transaction Documents,
(f) there is no existing Event of Default and no existing event which, with the passage of time or the giving of notice, would
constitute an Event of Default, (g) the issuance of the shares in question (or, in the case of an Optional Redemption, the shares
issuable upon conversion in full of the Optional Redemption Amount) to the Holder would not violate the limitations set forth in
Section 4(d) and Section 4(e) herein, (h) there has been no public announcement of a pending or proposed Change of Control Transaction
that has not been consummated, and (i) the applicable Holder is not in possession of any information provided by the Company, any
of its Subsidiaries, or any of their officers, directors, employees, agents or Affiliates, that constitutes, or may constitute,
material non-public information.

 

    	3

     

    

 

“Event of Default”
shall have the meaning set forth in Section 8(a).

 

“Interest
Conversion Rate” means 85% of the lesser of (i) the average of the VWAPs for the 5 consecutive Trading Days ending on
the Trading Day that is immediately prior to the applicable Interest Payment Date or (ii) the average of the VWAPs for the 5 consecutive
Trading Days ending on the Trading Day that is immediately prior to the date the applicable Interest Conversion Shares are issued
and delivered if such delivery is after the Interest Payment Date.

 

“Interest Conversion
Shares” shall have the meaning set forth in Section 2(a).

 

“Interest Notice Period”
shall have the meaning set forth in Section 2(a).

 

“Interest Payment Date”
shall have the meaning set forth in Section 2(a).

 

“Interest Share Amount”
shall have the meaning set forth in Section 2(a).

 

“Issuable Maximum”
shall have the meaning set forth in Section 4(e).

 

“Late Fees”
shall have the meaning set forth in Section 2(d).

 

“Mandatory
Default Amount” means the sum of (a) the greater of (i) the outstanding principal amount of this Debenture, plus all
accrued and unpaid interest hereon, divided by the Conversion Price on the date the Mandatory Default Amount is either (A) demanded
(if demand or notice is required to create an Event of Default) or otherwise due or (B) paid in full, whichever has a lower Conversion
Price, multiplied by the VWAP on the date the Mandatory Default Amount is either (x) demanded or otherwise due or (y) paid in full,
whichever has a higher VWAP, or (ii) 110% of the outstanding principal amount of this Debenture, plus 100% of accrued and unpaid
interest hereon, and (b) all other amounts, costs, expenses and liquidated damages due in respect of this Debenture.

 

    	4

     

    

 

“New York Courts”
shall have the meaning set forth in Section 9(e).

 

“Notice of Conversion”
shall have the meaning set forth in Section 4(a).

 

“Optional Redemption”
shall have the meaning set forth in Section 6(a).

 

“Optional
Redemption Amount” means the sum of (a) the then outstanding principal amount of the Debenture, (b) accrued but unpaid
interest and (c) all liquidated damages and other amounts due in respect of the Debenture.

 

“Optional Redemption
Date” shall have the meaning set forth in Section 6(a).

 

“Optional Redemption
Notice” shall have the meaning set forth in Section 6(a).

 

“Optional Redemption
Notice Date” shall have the meaning set forth in Section 6(a).

 

“Optional Redemption
Period” shall have the meaning set forth in Section 6(a).

 

“Original
Issue Date” means the date of the first issuance of the Debentures, regardless of any transfers of any Debenture and
regardless of the number of instruments which may be issued to evidence such Debentures.

 

“Permitted
Indebtedness” means (a) the indebtedness evidenced by the Debentures, (b) the Indebtedness existing on the Original
Issue Date and set forth on Schedule 3.1(p) attached to the Purchase Agreement, (c) indebtedness resulting from a bank
or other financial institution honoring a check, draft or similar instrument in the ordinary course of business, (d) indebtedness
arising under or in connection with cash management services in the ordinary course of business, (e) equipment lease obligations
and purchase money indebtedness of up to $1,000,000, in the aggregate, incurred in connection with the acquisition of fixed or
capital assets and equipment lease obligations with respect to newly acquired or leased assets, (f) indebtedness under bank lines
of credit up to $5,000,000 in the aggregate, at any time outstanding, (g) up to an aggregate of $5,000,000 of indebtedness that
(i) is expressly subordinate to the Debentures pursuant to a written subordination agreement with the Purchasers that is acceptable
to each Purchaser in its sole and absolute discretion and (ii) matures at a date later than the ninety first (91st) day following
the Maturity Date, and (h) obligations existing or arising under any swap or hedge contract; provided that such obligations are
(or were) entered into by the Company in the ordinary course of business for the purpose of mitigating risks associated with liabilities,
commitments, investments, assets or property held or reasonably anticipated by the Company, or changes in the value of securities
issued by the Company, and not for speculative purposes.

 

    	5

     

    

 

“Permitted Lien”
means the individual and collective reference to the following: (a) Liens for taxes, assessments
and other governmental charges or levies not yet due or Liens for taxes, assessments and other governmental charges or levies being
contested in good faith and by appropriate proceedings for which adequate reserves (in the good faith judgment of the management
of the Company) have been established in accordance with GAAP, (b) Liens imposed by law which were incurred in the ordinary course
of the Company’s business, such as carriers’, warehousemen’s and mechanics’ Liens, statutory landlords’
Liens, and other similar Liens arising in the ordinary course of the Company’s business, and which (x) do not individually
or in the aggregate materially detract from the value of such property or assets or materially impair the use thereof in the operation
of the business of the Company and its consolidated Subsidiaries or (y) are being contested in good faith by appropriate proceedings,
which proceedings have the effect of preventing for the foreseeable future the forfeiture or sale of the property or asset subject
to such Lien, (c) Liens incurred in connection with Permitted Indebtedness under clauses (a) and (b) thereunder, (d) Liens
incurred in connection with Permitted Indebtedness under clause (e) thereunder, provided that such Liens are not secured by assets
of the Company or its Subsidiaries other than the assets so acquired or leased, (e) any interest or title of a lessor, sublessor,
licensor or sublicensor under leases or licenses that are entered into in the ordinary course of business, (f) leases, licenses,
subleases, or sublicenses granted to others in the ordinary course of business that do not (i) interfere in any material respect
with the ordinary conduct of the business of the Company or (ii) secure any indebtedness, or (g) Liens securing judgments against
the Company for the payment of money that does not constitute an Event of Default.

 

“Purchase
Agreement” means the Securities Purchase Agreement, dated as of February 22, 2019 among the Company and the original
Holders, as amended, modified or supplemented from time to time in accordance with its terms.

 

“Registration
Rights Agreement” means the Registration Rights Agreement, dated on or about the date of the Purchase Agreement, among
the Company and the original Holders, in the form of Exhibit B to the Purchase Agreement.

 

“Registration
Statement” means a registration statement meeting the requirements set forth in the Registration Rights Agreement and
covering the resale of the Underlying Shares by each Holder as provided for in the Registration Rights Agreement.

 

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

 

“Series B Warrant”
shall have the meaning set forth in Section 6(a).

 

“Share Delivery Date”
shall have the meaning set forth in Section 4(c)(ii).

 

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

 

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

 

    	6

     

    

 

“VWAP”
means, for any date, the price determined by the first of the following clauses that applies: (a) if the Common Stock is
then listed or quoted on a Trading Market, the daily volume weighted average price of the Common Stock for such date (or the
nearest preceding date) on the Trading Market on which the Common Stock is then listed or quoted as reported by Bloomberg
L.P. (based on a Trading Day from 9:30 a.m. (New York City time) to 4:02 p.m. (New York City time)), (b) if OTCQB or OTCQX is
not a Trading Market, the volume weighted average price of the Common Stock for such date (or the nearest preceding date) on
OTCQB or OTCQX as applicable, or (c) if the Common Stock is not then listed or quoted for trading on OTCQB or OTCQX and if
prices for the Common Stock are then reported in the “Pink Sheets” published by OTC Markets, Inc. (or a similar
organization or agency succeeding to its functions of reporting prices), the most recent bid price per share of the Common
Stock so reported.

 

Section 2.          Interest.

 

a)        Payment of Interest in Cash or Kind. The Company shall pay interest to the Holder on the aggregate unconverted and then
outstanding principal amount of this Debenture at the rate of 10% per annum, payable quarterly in arrears on January 1, April 1,
July 1 and October 1, beginning on the first such date after the Original Issue Date, on each Conversion Date (as to that principal
amount then being converted), on each Optional Redemption Date (as to that principal amount then being redeemed) and on the Maturity
Date (each such date, an “Interest Payment Date”) (if any Interest Payment Date is not a Business Day, then
the applicable payment shall be due on the next succeeding Business Day), in cash or, at the Company’s option, in duly authorized,
validly issued, fully paid and non-assessable shares of Common Stock at the Interest Conversion Rate (the dollar amount to be paid
in shares, the “Interest Share Amount”) or a combination thereof; provided, however, that payment
in shares of Common Stock may only occur if (i) all of the Equity Conditions have been met (unless waived by the Holder
in writing) during the ten (10) Trading Days immediately prior to the applicable Interest Payment Date (the “Interest
Notice Period”) and through and including the date such shares of Common Stock are actually issued to the Holder, (ii)
the Company shall have given the Holder notice in accordance with the notice requirements set forth below, and (iii) as to such
Interest Payment Date, prior to such Interest Notice Period (but not more than five (5) Trading Days prior to the commencement
of such Interest Notice Period), the Company shall have delivered to the Holder’s account with The Depository Trust Company
a number of shares of Common Stock due such Holder to be applied against such Interest Share Amount equal to the quotient of (x)
the applicable Interest Share Amount divided by (y) the Interest Conversion Rate assuming for such purposes that the Interest Payment
Date is the Trading Day immediately prior to the commencement of the Interest Notice Period (the “Interest Conversion
Shares”).

 

    	7

     

    

 

b)       Company’s
Election to Pay Interest in Cash or Kind. Subject to the terms and conditions herein, the decision whether to pay interest
hereunder in cash, shares of Common Stock or a combination thereof shall be at the sole discretion of the Company. If the Company
elects to pay any interest hereunder in shares of Common Stock, the Company shall deliver to the Holder a written notice of its
election to pay interest hereunder ten (10) Trading Days prior to the applicable Interest Payment Date either in shares of Common
Stock or a combination of Common Stock and cash, and the Interest Share Amount as to the applicable Interest Payment Date and the
Interest Notice Period with respect to such payment shall commence as of the date of such notice, provided that the Company may
indicate in such notice that the election contained in such notice shall also apply to future Interest Payment Dates until revised
by a subsequent notice. After the first five (5) Trading Days of any Interest Notice Period, the Company’s election (whether
specific to an Interest Payment Date or continuous) shall be irrevocable as to such Interest Payment Date. Subject to the aforementioned
conditions, failure to timely deliver such written notice to the Holder shall be deemed an election by the Company to pay the interest
on such Interest Payment Date in cash. At any time that the Company delivers a notice to the Holder of its election to pay the
interest in shares of Common Stock, the Company shall timely file a prospectus supplement pursuant to Rule 424 disclosing such
election if at such time the Company has an effective Registration Statement that does not otherwise disclosure such election.
The aggregate number of shares of Common Stock otherwise issuable to the Holder on an Interest Payment Date shall be reduced by
the number of Interest Conversion Shares previously issued to the Holder in connection with such Interest Payment Date.

 

c)       Interest
Calculations. Interest shall be calculated on the basis of a 360-day year, consisting of twelve (12) thirty (30) calendar day
periods, and shall accrue daily commencing on the Original Issue Date until payment in full of the outstanding principal, together
with all accrued and unpaid interest, liquidated damages and other amounts which may become due hereunder, has been made. Payment
of interest in shares of Common Stock (other than the Interest Conversion Shares issued prior to an Interest Notice Period) shall
otherwise occur pursuant to Section 4(c)(ii) herein and, solely for purposes of the payment of interest in shares, the Interest
Payment Date shall be deemed the Conversion Date. Interest shall cease to accrue with respect to any principal amount converted,
provided that, the Company actually delivers the Conversion Shares within the time period required by Section 4(c)(ii) herein.
Interest hereunder will be paid to the Person in whose name this Debenture is registered on the records of the Company regarding
registration and transfers of this Debenture (the “Debenture Register”). Except as otherwise provided herein,
if at any time the Company pays interest partially in cash and partially in shares of Common Stock to the holders of the Debentures,
then such payment of cash shall be distributed ratably among the holders of the then-outstanding Debentures based on their (or
their predecessor’s) initial purchases of Debentures pursuant to the Purchase Agreement.

 

    	8

     

    

 

d)       Late
Fee. All overdue accrued and unpaid interest to be paid hereunder shall entail a late fee at an interest rate equal to the
lesser of 8% per annum or the maximum rate permitted by applicable law (the “Late Fees”) which shall accrue
daily from the date such interest is due hereunder through and including the date of actual payment in full. Notwithstanding anything
to the contrary contained herein, if, on any Interest Payment Date the Company has elected to pay accrued interest in the form
of Common Stock but the Company is not permitted to pay accrued interest in Common Stock because it fails to satisfy the conditions
for payment in Common Stock set forth in Section 2(a) herein, then, at the option of the Holder, the Company, in lieu of delivering
either shares of Common Stock pursuant to this Section 2 or paying the regularly scheduled interest payment in cash, shall deliver,
within three (3) Trading Days of each applicable Interest Payment Date, an amount in cash equal to the product of (x) the number
of shares of Common Stock otherwise deliverable to the Holder in connection with the payment of interest due on such Interest Payment
Date multiplied by (y) the highest VWAP during the period commencing five (5) Trading Days after the Interest Payment Date and
ending on the Trading Day prior to the date such payment is actually made. If any Interest Conversion Shares are issued to the
Holder in connection with an Interest Payment Date and are not applied against an Interest Share Amount, then the Holder shall
promptly return such excess shares to the Company.

 

e)       Prepayment.
Except as otherwise set forth in this Debenture, the Company may not prepay any portion of the principal amount of this Debenture
without the prior written consent of the Holder.

 

Section
3.          Registration of Transfers and Exchanges.

 

a)        Different
Denominations. This Debenture is exchangeable for an equal aggregate principal amount of Debentures of different authorized
denominations, as requested by the Holder surrendering the same. No service charge will be payable for such registration of transfer
or exchange.

 

b)       Investment
Representations. This Debenture has been issued subject to certain investment representations of the original Holder set forth
in the Purchase Agreement and may be transferred or exchanged only in compliance with the Purchase Agreement and applicable federal
and state securities laws and regulations.

 

Section
4.         Conversion.

 

a)        Voluntary
Conversion. At any time after the Original Issue Date until this Debenture is no longer outstanding, this Debenture shall
be convertible, in whole or in part, into shares of Common Stock at the option of the Holder, at any time and from time to time
(subject to the conversion limitations set forth in Section 4(d) and Section 4(e) hereof). The Holder shall effect conversions
by delivering to the Company a properly completed Notice of Conversion, the form of which is attached hereto as Annex A (each,
a “Notice of Conversion”), specifying therein the principal amount of this Debenture, and any accrued but unpaid interest,
to be converted and the date on which such conversion shall be effected (such date, the “Conversion Date”). If no
Conversion Date is specified in a Notice of Conversion, the Conversion Date shall be the date that such Notice of Conversion is
deemed delivered hereunder. No ink-original Notice of Conversion shall be required, nor shall any
medallion guarantee (or other type of guarantee or notarization) of any Notice of Conversion form be required. To effect conversions
hereunder, the Holder shall not be required to physically surrender this Debenture to the Company unless the entire principal
amount of this Debenture, plus all accrued and unpaid interest thereon, has been so converted in which case the Holder shall surrender
this Debenture as promptly as is reasonably practicable after such conversion without delaying the Company’s obligation
to deliver the shares on the Share Delivery Date. Conversions hereunder shall have the effect of lowering the outstanding principal
amount of this Debenture in an amount equal to the applicable conversion. The Holder and the Company shall maintain records showing
the principal amount(s) converted and the date of such conversion(s). The Company may deliver an objection to any Notice of Conversion
within one (1) Business Day of receipt of such Notice of Conversion. In the event of any dispute or discrepancy, the records of
the Holder shall be controlling and determinative in the absence of manifest error. The Holder, and any assignee by acceptance
of this Debenture, acknowledge and agree that, by reason of the provisions of this paragraph, following conversion of a portion
of this Debenture, the unpaid and unconverted principal amount of this Debenture may be less than the amount stated on the face
hereof.

 

    	9

     

    

 

b)       Conversion
Price. The conversion price in effect on any Conversion Date shall be equal to $1.84, subject to adjustment herein (the
“Conversion Price”).

 

c)        Mechanics
of Conversion.

 

i.            Conversion
Shares Issuable Upon Conversion of Principal Amount. The number of Conversion Shares issuable upon a conversion hereunder shall
be determined by the quotient obtained by dividing (x) the outstanding principal amount of this Debenture to be converted by (y)
the Conversion Price.

 

ii.           Delivery
of Conversion Shares Upon Conversion. Not later than two (2) Trading Days after each Conversion Date (the
“Share Delivery Date”), the Company shall deliver, or cause to be delivered, to the Holder (A) the
Conversion Shares which, on or after the six (6) month anniversary of the Original Issue Date, shall be free of restrictive
legends and trading restrictions (other than those which may then be required by the Purchase Agreement) representing the
number of Conversion Shares being issued upon the conversion of this Debenture (including, if the Company has given
continuous notice pursuant to Section 2(b) for payment of interest in shares of Common Stock at least ten (10) Trading Days
prior to the date on which the Notice of Conversion is delivered to the Company, shares of Common Stock representing the
payment of accrued interest otherwise determined pursuant to Section 2(a) but assuming that the Interest Notice Period is the
ten (10) Trading Days period immediately prior to the date on which the Notice of Conversion is delivered to the Company and
excluding for such issuance the condition that the Company deliver Interest Conversion Shares as to such interest payment
prior to the commencement of the Interest Notice Period) and (B) a bank check in the amount of accrued and unpaid interest
(if the Company has elected or is required to pay accrued interest in cash). On or after the six (6) month anniversary of the
Original Issue Date, the Company shall deliver any Conversion Shares required to be delivered by the Company under this
Section 4(c) electronically through the Depository Trust Company or another established clearing corporation performing
similar functions.

 

    	10

     

    

 

iii.          Failure
to Deliver Conversion Shares. If, in the case of any Notice of Conversion, such Conversion Shares are not delivered to or as
directed by the applicable Holder by the Share Delivery Date, the Holder shall be entitled to elect by written notice to the Company
at any time on or before its receipt of such Conversion Shares, to rescind such Conversion, in which event the Company shall promptly
return to the Holder any original Debenture delivered to the Company and the Holder shall promptly return to the Company the Conversion
Shares issued to such Holder pursuant to the rescinded Conversion Notice.

 

iv.          Obligation
Absolute. The Company’s obligations to issue and deliver the Conversion Shares upon conversion of this Debenture in accordance
with the terms hereof are absolute and unconditional, irrespective of any action or inaction by the Holder to enforce the same,
any waiver or consent with respect to any provision hereof, the recovery of any judgment against any Person or any action to enforce
the same, or any setoff, counterclaim, recoupment, limitation or termination, or any breach or alleged breach by the Holder or
any other Person of any obligation to the Company or any violation or alleged violation of law by the Holder or any other Person,
and irrespective of any other circumstance which might otherwise limit such obligation of the Company to the Holder in connection
with the issuance of such Conversion Shares; provided, however, that such delivery shall not operate as a waiver
by the Company of any such action the Company may have against the Holder. In the event the Holder of this Debenture shall elect
to convert any or all of the outstanding principal amount hereof, the Company may not refuse conversion based on any claim that
the Holder or anyone associated or affiliated with the Holder has been engaged in any violation of law or any agreement (except
if, upon the Holder’s election to convert any principal amount here, the Company’s delivery of Conversion Shares in
connection therewith constitutes a violation of law by the Company, evidenced by a written opinion of counsel to the Company),
unless an injunction from a court, on notice to Holder, restraining and or enjoining conversion of all or part of this Debenture
shall have been sought and obtained, and the Company posts a surety bond for the benefit of the Holder in the amount of 125% of
the outstanding principal amount of this Debenture, which is subject to the injunction, which bond shall remain in effect until
the completion of arbitration/litigation of the underlying dispute and the proceeds of which shall be payable to the Holder to
the extent it obtains judgment. In the absence of such injunction, the Company shall issue Conversion Shares or, if applicable,
cash, upon a properly noticed conversion. Nothing herein shall limit a Holder’s right to pursue actual damages or
declare an Event of Default pursuant to Section 8 hereof for the Company’s failure to deliver Conversion Shares within the
period specified herein and the Holder shall have the right to pursue all remedies available to it hereunder, at law or in equity
including, without limitation, a decree of specific performance and/or injunctive relief. The exercise of any such rights shall
not prohibit the Holder from seeking to enforce damages pursuant to any other Section hereof or under applicable law.

 

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v.          Compensation for
Buy-In on Failure to Timely Deliver Conversion Shares Upon Conversion. In addition to any other rights available to the Holder,
if the Company fails for any reason to deliver to the Holder such Conversion Shares by the Share Delivery Date pursuant to Section
4(c)(ii), and if after such Share Delivery Date the Holder is required by its brokerage firm to purchase (in an open market transaction
or otherwise), or the Holder’s brokerage firm otherwise purchases, shares of Common Stock to deliver in satisfaction of a
sale by the Holder of the Conversion Shares which the Holder was entitled to receive upon the conversion relating to such Share
Delivery Date (a “Buy-In”), then the Company shall (A) pay in cash to the Holder (in addition to any other remedies
available to or elected by the Holder) the amount, if any, by which (x) the Holder’s total purchase price (including any
brokerage commissions) for the Common Stock so purchased exceeds (y) the product of (1) the aggregate number of shares of Common
Stock that the Holder was entitled to receive from the conversion at issue multiplied by (2) the actual sale price at which the
sell order giving rise to such purchase obligation was executed (including any brokerage commissions) and (B) at the option of
the Holder, either reissue (if surrendered) this Debenture in a principal amount equal to the principal amount of the attempted
conversion (in which case such conversion shall be deemed rescinded) or deliver to the Holder the number of shares of Common Stock
that would have been issued if the Company had timely complied with its delivery requirements under Section 4(c)(ii). For example,
if the Holder purchases Common Stock having a total purchase price of $11,000 to cover a Buy-In with respect to an attempted conversion
of this Debenture with respect to which the actual sale price of the Conversion Shares (including any brokerage commissions) giving
rise to such purchase obligation was a total of $10,000 under clause (A) of the immediately preceding sentence, the Company shall
be required to pay the Holder $1,000. The Holder shall provide the Company written notice indicating the amounts payable to the
Holder in respect of the Buy-In and, upon request of the Company, evidence of the amount of such loss. Nothing herein shall limit
a Holder’s right to pursue any other remedies available to it hereunder, at law or in equity including, without limitation,
a decree of specific performance and/or injunctive relief with respect to the Company’s failure to timely deliver Conversion
Shares upon conversion of this Debenture as required pursuant to the terms hereof.

 

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vi.          Reservation
of Shares Issuable Upon Conversion. The Company covenants that it will at all times reserve and keep available out of its authorized
and unissued shares of Common Stock for the sole purpose of issuance upon conversion of this Debenture and payment of interest
on this Debenture, each as herein provided, free from preemptive rights or any other actual contingent purchase rights of Persons
other than the Holder (and the other holders of the Debentures), not less than such aggregate number of shares of the Common Stock
as shall (subject to the terms and conditions set forth in the Purchase Agreement) be issuable (taking into account the adjustments
and restrictions of Section 5) upon the conversion of the then outstanding principal amount of this Debenture and payment of interest
hereunder. The Company covenants that all shares of Common Stock that shall be so issuable shall, upon issue, be duly authorized,
validly issued, fully paid and nonassessable and, if the Registration Statement is then effective under the Securities Act, shall
be registered for public resale in accordance with such Registration Statement (subject to such Holder’s compliance with
its obligations under the Registration Rights Agreement).

 

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

 

viii.        Transfer
Taxes and Expenses. The issuance of Conversion Shares on conversion of this Debenture shall be made without charge to the
Holder hereof for any documentary stamp or similar taxes that may be payable in respect of the issue or delivery of such Conversion
Shares, provided that the Company shall not be required to pay any tax that may be payable in respect of any transfer involved
in the issuance and delivery of any such Conversion Shares upon conversion in a name other than that of the Holder of this Debenture
so converted and the Company shall not be required to issue or deliver such Conversion Shares unless or until the Person or Persons
requesting the issuance thereof shall have paid to the Company the amount of such tax or shall have established to the satisfaction
of the Company that such tax has been paid. The Company shall pay all Transfer Agent fees required for same-day processing of
any Notice of Conversion and all fees to the Depository Trust Company (or another established clearing corporation performing
similar functions) required for same-day electronic delivery of the Conversion Shares.

 

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d)       Holder’s
Conversion Limitations. The Company shall not effect any conversion of this Debenture, and a Holder shall not have the right
to convert any portion of this Debenture, to the extent that after giving effect to the conversion set forth on the applicable
Notice of Conversion, the Holder (together with the Holder’s Affiliates, and any other Persons acting as a group together
with the Holder or any of the Holder’s Affiliates (such Persons, “Attribution Parties”))
would beneficially own in excess of the Beneficial Ownership Limitation (as defined below). For purposes of the foregoing sentence,
the number of shares of Common Stock beneficially owned by the Holder and its Affiliates and Attribution Parties shall include
the number of shares of Common Stock issuable upon conversion of this Debenture with respect to which such determination is being
made, but shall exclude the number of shares of Common Stock which are issuable upon (i) conversion of the remaining, unconverted
principal amount of this Debenture beneficially owned by the Holder or any of its Affiliates or Attribution Parties and (ii) exercise
or conversion of the unexercised or unconverted portion of any other securities of the Company subject to a limitation on conversion
or exercise analogous to the limitation contained herein (including, without limitation, any other Debentures or the Warrants)
beneficially owned by the Holder or any of its Affiliates or Attribution Parties. Except as set forth in the preceding sentence,
for purposes of this Section 4(d), beneficial ownership shall be calculated in accordance with Section 13(d) of the Exchange Act
and the rules and regulations promulgated thereunder. To the extent that the limitation contained in this Section 4(d) applies,
the determination of whether this Debenture is convertible (in relation to other securities owned by the Holder together with any
Affiliates and Attribution Parties) and of which principal amount of this Debenture is convertible shall be in the sole discretion
of the Holder, and the submission of a Notice of Conversion shall be deemed to be the Holder’s determination of whether this
Debenture may be converted (in relation to other securities owned by the Holder together with any Affiliates or Attribution Parties)
and which principal amount of this Debenture is convertible, in each case subject to the Beneficial Ownership Limitation. To ensure
compliance with this restriction, the Holder will be deemed to represent to the Company each time it delivers a Notice of Conversion
that such Notice of Conversion has not violated the restrictions set forth in this paragraph and the Company shall have no obligation
to verify or confirm the accuracy of such determination. In addition, a determination as to any group status as contemplated above
shall be determined in accordance with Section 13(d) of the Exchange Act and the rules and regulations promulgated thereunder.
For purposes of this Section 4(d), in determining the number of outstanding shares of Common Stock, the Holder may rely on the
number of outstanding shares of Common Stock as stated in the most recent of the following: (i) the Company’s most recent
periodic or annual report filed with the Commission, as the case may be, (ii) a more recent public announcement by the Company,
or (iii) a more recent written notice by the Company or the Transfer Agent setting forth the number of shares of Common Stock outstanding.
Upon the written request of a Holder, the Company shall within one Trading Day confirm in writing to the Holder the number of shares
of Common Stock then outstanding. In any case, the number of outstanding shares of Common Stock shall be determined after giving
effect to the conversion or exercise of securities of the Company, including this Debenture, by the Holder or its Affiliates since
the date as of which such number of outstanding shares of Common Stock was reported. The “Beneficial Ownership Limitation”
shall be 4.99% of the number of shares of the Common Stock outstanding immediately after giving effect to the issuance of shares
of Common Stock issuable upon conversion of this Debenture held by the Holder. The Holder, upon notice to the Company, may increase
or decrease the Beneficial Ownership Limitation provisions of this Section 4(d), provided that the Beneficial Ownership
Limitation in no event exceeds 9.99% of the number of shares of the Common Stock outstanding immediately after giving effect to
the issuance of shares of Common Stock upon conversion of this Debenture held by the Holder and the Beneficial Ownership Limitation
provisions of this Section 4(d) shall continue to apply. Any increase in the Beneficial Ownership Limitation will not be effective
until the sixty first (61st) day after such notice is delivered to the Company. The Beneficial Ownership Limitation provisions
of this paragraph shall be construed and implemented in a manner otherwise than in strict conformity with the terms of this Section
4(d) to correct this paragraph (or any portion hereof) which may be defective or inconsistent with the intended Beneficial Ownership
Limitation contained herein or to make changes or supplements necessary or desirable to properly give effect to such limitation.
The limitations contained in this paragraph shall apply to a successor holder of this Debenture.

 

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e)        Issuance
Limitations. Notwithstanding anything herein to the contrary, if the Company has not obtained Shareholder Approval, then the
Company may not issue, upon conversion of this Debenture, a number of shares of Common Stock which, when aggregated with any shares
of Common Stock issued on or after the Original Issue Date and prior to such Conversion Date (i) in connection with the conversion
of any Debentures issued pursuant to the Purchase Agreement, (ii) in connection with the exercise of any Warrants issued pursuant
to the Purchase Agreement and (iii) in connection with any Shares issued pursuant to the Purchase Agreement, would exceed 21,468,429
shares of Common Stock (subject to adjustment for forward and reverse stock splits, recapitalizations and the like) (such number
of shares, the “Issuable Maximum”). Each Holder shall be entitled to a portion of the Issuable Maximum equal
to the quotient obtained by dividing (x) the original principal amount of the Holder’s Debenture by (y) the aggregate original
principal amount of all Debentures issued on the Original Issue Date to all Holders. In addition, each Holder may allocate its
pro-rata portion of the Issuable Maximum among Debentures, Shares and Warrants held by it in its sole discretion. Such portion
shall be adjusted upward ratably in the event a Holder no longer holds any Debentures or Warrants and the amount of shares issued
to the Holder pursuant to the Holder’s Debentures, Shares and Warrants was less than the Holder’s pro-rata share of
the Issuable Maximum.

 

Section 5.          Certain
Adjustments.

 

a)        Stock Dividends
and Stock Splits. If the Company, at any time while this Debenture is outstanding: (i) pays a stock dividend or otherwise makes
a distribution or distributions payable in shares of Common Stock on shares of Common Stock or any Common Stock Equivalents (which,
for avoidance of doubt, shall not include any shares of Common Stock issued by the Company upon conversion of, or payment of interest
on, the Debentures or upon exercise of the Warrants), (ii) subdivides outstanding shares of Common Stock into a larger number of
shares, (iii) combines (including by way of a reverse stock split) outstanding shares of Common Stock into a smaller number of
shares or (iv) issues, in the event of a reclassification of shares of the Common Stock, any shares of capital stock of the Company,
then the Conversion Price shall be multiplied by a fraction of which the numerator shall be the number of shares of Common Stock
(excluding any treasury shares of the Company) outstanding immediately before such event, and of which the denominator shall be
the number of shares of Common Stock outstanding immediately after such event. Any adjustment made pursuant to this Section shall
become effective immediately after the record date for the determination of stockholders entitled to receive such dividend or distribution
and shall become effective immediately after the effective date in the case of a subdivision, combination or re-classification.

 

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b)        Subsequent
Equity Sales. If, at any time while this Debenture is outstanding, the Company or any Subsidiary, as applicable, sells or
grants any option to purchase or sells or grants any right to reprice, or otherwise disposes of or issues (or announces any sale,
grant or any option to purchase or other disposition), any Common Stock or Common Stock Equivalents entitling any Person to acquire
shares of Common Stock at an effective price per share that is lower than the then Conversion Price (such lower price, the “Base
Conversion Price” and such issuances, collectively, a “Dilutive Issuance”) (if the holder of the Common Stock
or Common Stock Equivalents so issued shall at any time, whether by operation of purchase price adjustments, reset provisions,
floating conversion, exercise or exchange prices or otherwise, or due to warrants, options or rights per share which are issued
in connection with such issuance, be entitled to receive shares of Common Stock at an effective price per share that is lower
than the Conversion Price, such issuance shall be deemed to have occurred for less than the Conversion Price on such date of the
Dilutive Issuance), then simultaneously with the consummation of each Dilutive Issuance the Conversion Price shall be reduced
to equal the Base Conversion Price. Notwithstanding the foregoing, no adjustment will be made under this Section 5(b) in respect
of an Exempt Issuance. The Company shall notify the Holder in writing, no later than the Trading Day following the issuance of
any Common Stock or Common Stock Equivalents subject to this Section 5(b), indicating therein the applicable issuance price, or
applicable reset price, exchange price, conversion price and other pricing terms (such notice, the “Dilutive Issuance Notice”).
For purposes of clarification, whether or not the Company provides a Dilutive Issuance Notice pursuant to this Section 5(b), upon
the occurrence of any Dilutive Issuance, the Holder is entitled to receive a number of Conversion Shares based upon the Base Conversion
Price on or after the date of such Dilutive Issuance, regardless of whether the Holder accurately refers to the Base Conversion
Price in the Notice of Conversion.

 

c)         Calculations.
All calculations under this Section 5 shall be made to the nearest cent or the nearest 1/100th of a share, as the case may be.
For purposes of this Section 5, the number of shares of Common Stock deemed to be issued and outstanding as of a given date shall
be the sum of the number of shares of Common Stock (excluding any treasury shares of the Company) issued and outstanding.

 

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 d)        Notice to the Holder.

 

i.            Adjustment
to Conversion Price. Whenever the Conversion Price is adjusted pursuant to any provision of this Section 5, the Company shall
promptly deliver to each Holder a notice setting forth the Conversion Price after such adjustment and setting forth a brief statement
of the facts requiring such adjustment.

 

ii.           Notice
to Allow Conversion by Holder. If (A) the Company shall declare a dividend (or any other distribution in whatever form) on
the Common Stock, (B) the Company shall declare a special nonrecurring cash dividend on or a redemption of the Common Stock, (C)
the Company shall authorize the granting to all holders of the Common Stock of rights or warrants to subscribe for or purchase
any shares of capital stock of any class or of any rights, (D) the approval of any stockholders of the Company shall be required
in connection with any reclassification of the Common Stock, any consolidation or merger to which the Company is a party, any sale
or transfer of all or substantially all of the assets of the Company, or any compulsory share exchange whereby the Common Stock
is converted into other securities, cash or property or (E) the Company shall authorize the voluntary or involuntary dissolution,
liquidation or winding up of the affairs of the Company, then, in each case, the Company shall cause to be filed at each office
or agency maintained for the purpose of conversion of this Debenture, and shall cause to be delivered to the Holder at its last
address as it shall appear upon the Debenture Register, at least five (5) calendar days prior to the applicable record or effective
date hereinafter specified, a notice stating (x) the date on which a record is to be taken for the purpose of such dividend, distribution,
redemption, rights or warrants, or if a record is not to be taken, the date as of which the holders of the Common Stock of record
to be entitled to such dividend, distributions, redemption, rights or warrants are to be determined or (y) the date on which such
reclassification, consolidation, merger, sale, transfer or share exchange is expected to become effective or close, and the date
as of which it is expected that holders of the Common Stock of record shall be entitled to exchange their shares of the Common
Stock for securities, cash or other property deliverable upon such reclassification, consolidation, merger, sale, transfer or share
exchange, provided that the failure to deliver such notice or any defect therein or in the delivery thereof shall not affect the
validity of the corporate action required to be specified in such notice. To the extent that any notice provided hereunder constitutes,
or contains, material, non-public information regarding the Company or any of the Subsidiaries, the Company shall simultaneously
file such notice with the Commission pursuant to a Current Report on Form 8-K. The Holder shall remain entitled to convert this
Debenture during the 5-day period commencing on the date of such notice through the effective date of the event triggering such
notice except as may otherwise be expressly set forth herein.

 

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Section 6.          Redemptions.

 

a)        Optional
Redemption at Election of Company. Subject to the provisions of this Section 6(a), at any time after the Original Issue Date,
the Company may deliver a notice to the Holder (an “Optional Redemption Notice” and the date such notice is
deemed delivered hereunder, the “Optional Redemption Notice Date”) of its irrevocable election to redeem all,
but not less than all, of the then outstanding principal amount of this Debenture for cash in an amount equal to the Optional
Redemption Amount on the tenth (10th) Trading Day following the Optional Redemption Notice Date (such date, the “Optional
Redemption Date”, such ten (10) Trading Day period, the “Optional Redemption Period” and such redemption,
the “Optional Redemption”). The Optional Redemption Amount is payable in full on the Optional Redemption Date.
The Company may only effect an Optional Redemption if each of the Equity Conditions shall have been met (unless waived in writing
by the Holder) on each Trading Day during the period commencing on the Optional Redemption Notice Date through to the Optional
Redemption Date and through and including the date on which payment of the Optional Redemption Amount is actually made in full.
If any of the Equity Conditions shall cease to be satisfied at any time during the Optional Redemption Period, then the Holder
may elect to nullify the Optional Redemption Notice by notice to the Company within three (3)         Trading
Days after the first day on which any such Equity Condition has not been met (provided that if, by a provision of the Transaction
Documents, the Company is obligated to notify the Holder of the non-existence of an Equity Condition, such notice period
shall be extended to the third (3rd) Trading Day after proper notice from the
Company) in which case the Optional Redemption Notice shall be null and void, ab initio. The Company covenants and
agrees that it will honor all Notices of Conversion tendered from the time of delivery of the Optional Redemption Notice through
the date all amounts owing thereon are due and paid in full. The Company’s determination to pay an Optional Redemption in
cash shall be applied ratably to all of the holders of the then outstanding Debentures based on their (or their predecessor’s)
initial purchases of Debentures pursuant to the Purchase Agreement. In addition, in the event of any Optional Redemption, the
Company shall issue to the Holder Series B Warrants to purchase a number of shares of Common Stock equal to 50% of the Conversion
Shares issuable on an as-converted basis of the principal amount of the Holder’s Debenture redeemed in the Optional Redemption
(for purposes of clarity, not including any principal amount of this Debenture that is converted by the Holder during the Optional
Redemption Period) as if such principal amount of this Debenture was converted immediately prior to such Optional Redemption,
in the form of Series A Warrant issued on the Closing Date, exercisable for a period of five (5) years from the Optional Redemption
Date (the “Series B Warrant”). The Company shall deliver the Series B Warrants on the Optional Redemption Date.
The purchase price of one share of Common Stock under this Series B Warrant shall be equal to the Conversion Price of the Debenture
on the Optional Redemption Date.

 

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b)        Redemption
Procedure. The payment of cash and the issuance of the Series B Warrant pursuant to an Optional Redemption shall be payable
on the Optional Redemption Date. If any portion of the payment pursuant to an Optional Redemption shall not be paid by the Company
by the applicable due date, interest shall accrue thereon at an interest rate equal to the lesser of 10% per annum or the
maximum rate permitted by applicable law until such amount is paid in full. Notwithstanding anything herein contained to the contrary,
if any portion of the Optional Redemption Amount remains unpaid after such date, the Holder may elect, by written notice to the
Company given at any time thereafter, to invalidate such Optional Redemption, ab initio, and, with respect to the Company’s
failure to honor the Optional Redemption, the Company shall have no further right to exercise such Optional Redemption. Notwithstanding
anything to the contrary in this Section 6, the Company’s determination to redeem in cash or its elections under Section
6(b) shall be applied ratably among the Holders of Debentures. The Holder may elect to convert the outstanding principal amount
of the Debenture pursuant to Section 4 prior to actual payment in cash for any redemption under this Section 6 by the delivery
of a Notice of Conversion to the Company.

 

Section 7.         Negative
Covenants. As long as any portion of this Debenture remains outstanding, unless the holders of at least a majority in principal
amount of the then outstanding Debentures shall have otherwise given prior written consent, the Company shall not, directly or
indirectly:

 

a)       other
than Permitted Indebtedness, enter into, create, incur, assume, guarantee or suffer to exist any indebtedness for borrowed money
of any kind, including, but not limited to, a guarantee, on or with respect to any of its property or assets now owned or hereafter
acquired or any interest therein or any income or profits therefrom;

 

b)       other
than Permitted Liens, enter into, create, incur, assume or suffer to exist any Liens of any kind, on or with respect to any of
its property or assets now owned or hereafter acquired or any interest therein or any income or profits therefrom;

 

c)        amend
its charter documents, including, without limitation, its certificate of incorporation and bylaws, in any manner that materially
and adversely affects any rights of the Holder;

 

d)       repay,
repurchase or offer to repay, repurchase or otherwise acquire any Indebtedness (other than Indebtedness under clauses (c) and (d)
in the definition of Permitted Indebtedness), other than the Debentures if on a pro-rata basis; or

 

 e)        enter into any agreement with respect to any of the foregoing.

 

Section
8.          Events of Default.

 

a)       “Event
of Default” means, wherever used herein, any of the following events (whatever the reason for such event and whether
such event shall be voluntary or involuntary or effected by operation of law or pursuant to any judgment, decree or order of any
court, or any order, rule or regulation of any administrative or governmental body):

 

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i.            any
default in the payment of (A) the principal amount of any Debenture or (B) interest, liquidated damages and other amounts owing
to a Holder under any Debenture, as and when the same shall become due and payable (whether on a Conversion Date, Optional Redemption
Date, or the Maturity Date or by acceleration or otherwise) which default, solely in the case of a default under clause (B) above,
is not cured within three (3) Trading Days;

 

ii.           the
Company shall fail to observe or perform any other covenant or agreement contained in the Debentures (other than a breach by
the Company of its obligations to deliver shares of Common Stock to the Holder upon conversion, which breach is addressed in
clause (xi) below) or in any Transaction Document, which failure is not cured, if possible to cure, within the earlier to
occur of (A) ten (10) Trading Days after notice of such failure sent by the
Holder or by any other Holder to the Company and (B) fifteen (15) Trading Days after the Company has become or should have
become aware of such failure;

 

iii.          a
default or event of default (subject to any grace or cure period provided in the applicable agreement, document or
instrument) shall occur under (A) any of the Transaction Documents or (B) any other material agreement, lease, document or
instrument to which the Company is obligated (and not covered by clause (vi) below);

 

iv.          any
representation or warranty made in this Debenture, any other Transaction Documents, any written statement pursuant hereto or thereto
or any other report, financial statement or certificate made or delivered to the Holder or any other Holder shall be untrue or
incorrect in any material respect as of the date when made or deemed made;

 

v.           the
Company or any Significant Subsidiary (as such term is defined in Rule 1-02(w) of Regulation S-X) shall be subject to a Bankruptcy
Event;

 

vi.          the
Company shall default on any of its obligations under any mortgage, credit agreement or other facility, indenture agreement, factoring
agreement or other instrument under which there may be issued, or by which there may be secured or evidenced, any indebtedness
for borrowed money or money due under any long term leasing or factoring arrangement that (a) involves an obligation greater than
$500,000, whether such indebtedness now exists or shall hereafter be created, and (b) results in such indebtedness becoming or
being declared due and payable prior to the date on which it would otherwise become due and payable;

 

vii.         the
Common Stock shall not be eligible for listing or quotation for trading on a Trading Market and shall not be eligible to resume
listing or quotation for trading thereon within five (5) Trading Days;

 

    	20

     

    

 

viii.       the Company
shall be a party to any Change of Control Transaction or shall agree to sell or dispose of all or in excess of 50% of its assets
in one transaction or a series of related transactions (whether or not such sale would constitute a Change of Control Transaction);

 

ix.          the
Initial Registration Statement (as defined in the Registration Rights Agreement) shall not have been declared effective by
the Commission on or prior to the one hundred eightieth (180th) calendar day after the Closing Date or the Company
does not meet the current public information requirements under Rule 144 in respect of the Registrable Securities (as defined
in the Registration Rights Agreement);

 

x.            if,
during the Effectiveness Period (as defined in the Registration Rights Agreement), either (a) the effectiveness of the Registration
Statement lapses for any reason or (b) the Holder shall not be permitted to resell Registrable Securities (as defined in the Registration
Rights Agreement) under the Registration Statement for a period of more than twenty (20) consecutive Trading Days or forty five
(45) non-consecutive Trading Days during any 12 month period; provided, however, that, if the Company is negotiating
a merger, consolidation, acquisition or sale of all or substantially all of its assets or a similar transaction and, in the written
opinion of counsel to the Company, the Registration Statement would be required to be amended to include information concerning
such pending transaction(s) or the parties thereto which information is not available or may not be publicly disclosed at the time,
the Company shall be permitted an additional ten (10) consecutive Trading Days during any 12 month period pursuant to this Section
8(a)(x);

 

xi.           the
Company shall fail for any reason to deliver Conversion Shares to a Holder prior to the fifth (5th) Trading Day after a Conversion
Date pursuant to Section 4(c) or the Company shall provide at any time notice to the Holder, including by way of public announcement,
of the Company’s intention to not honor requests for conversions of any Debentures in accordance with the terms hereof;

 

xii.          any
monetary judgment, writ or similar final process shall be entered or filed against the Company or any of its property or other
assets for more than $500,000, and such judgment, writ or similar final process shall remain unvacated, unbonded or unstayed for
a period of sixty (60) calendar days, unless such judgment, writ or similar final process is covered by an independent third party
insurer which insurer has been notified of such judgement or order and has acknowledged in writing coverage of the judgment, writ
or final process within such 60 day period; or

 

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xiii.        a
false or inaccurate certification (including a false or inaccurate deemed certification) by the Company that the Equity Conditions
are satisfied or that there has been no Equity Conditions failure or as to whether any Event of Default has occurred.

 

b)       Remedies Upon
Event of Default. If any Event of Default occurs, the outstanding principal amount of this Debenture, plus accrued but unpaid
interest, liquidated damages and other amounts owing in respect thereof through the date of acceleration, shall become, at the
Holder’s election, immediately due and payable in cash at the Mandatory Default Amount. Commencing five (5) days after the
occurrence of any Event of Default that results in the eventual acceleration of this Debenture, the interest rate on this Debenture
shall accrue at an interest rate equal to the lesser of 15% per annum or the maximum rate permitted under applicable law. Upon
the payment in full of the Mandatory Default Amount, the Holder shall promptly surrender this Debenture to or as directed by the
Company. In connection with such acceleration described herein, the Holder need not provide, and the Company hereby waives, any
presentment, demand, protest or other notice of any kind, and the Holder may immediately and without expiration of any grace period
enforce any and all of its rights and remedies hereunder and all other remedies available to it under applicable law. Such acceleration
may be rescinded and annulled by Holder at any time prior to payment hereunder and the Holder shall have all rights as a holder
of the Debenture until such time, if any, as the Holder receives full payment pursuant to this Section 8(b). No such rescission
or annulment shall affect any subsequent Event of Default or impair any right consequent thereon.

 

Section 9.          Miscellaneous.

 

a)        Notices.
Any and all notices or other communications or deliveries to be provided by the Holder hereunder, including, without limitation,
any Notice of Conversion, shall be in writing and delivered personally, by facsimile, by email attachment, or sent by a nationally
recognized overnight courier service, addressed to the Company, at the address set forth above, or such other facsimile number,
email address, or address as the Company may specify for such purposes by notice to the Holder delivered in accordance with this
Section 9(a). Any and all notices or other communications or deliveries to be provided by the Company hereunder shall be in writing
and delivered personally, by facsimile, by email attachment, or sent by a nationally recognized overnight courier service addressed
to each Holder at the facsimile number, email address or address of the Holder appearing on the books of the Company, or if no
such facsimile number or email attachment or address appears on the books of the Company, at the principal place of business of
such Holder, as set forth in the Purchase Agreement. Any notice or other communication or deliveries hereunder shall be deemed
given and effective on the earliest of (i) the date of transmission, if such notice or communication is delivered via facsimile
at the facsimile number or email attachment to the email address set forth on the signature pages attached hereto prior to 5:30
p.m. (New York City time) on any date, (ii) the next Trading Day after the date of transmission, if such notice or communication
is delivered via facsimile at the facsimile number or email attachment to the email address 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, (iii) the second Trading
Day following the date of mailing, if sent by U.S. nationally recognized overnight courier service or (iv) upon actual receipt
by the party to whom such notice is required to be given.

 

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b)        Absolute
Obligation. Except as expressly provided herein, no provision of this Debenture shall alter or impair the obligation of the
Company, which is absolute and unconditional, to pay the principal of, liquidated damages and accrued interest, as applicable,
on this Debenture at the time, place, and rate, and in the coin or currency, herein prescribed. This Debenture is a direct debt
obligation of the Company. This Debenture ranks pari passu with all other Debentures now or hereafter issued under
the terms set forth herein.

 

c)        Transferability.
Subject to compliance with any applicable securities laws, this Debenture, and the provisions of Section 4.1 of the Purchase Agreement,
this Debenture and all rights hereunder (including, without limitation, any registration rights) are transferable, in whole or
in part, upon surrender of this Debenture at the principal office of the Company or its designated agent, together with a written
assignment of this Debenture substantially in the form attached hereto duly executed by the Holder or its agent or attorney and
funds sufficient to pay any transfer taxes payable upon the making of such transfer.

 

d)        Lost
or Mutilated Debenture. If this Debenture shall be mutilated, lost, stolen or destroyed, the Company shall execute and deliver,
in exchange and substitution for and upon cancellation of a mutilated Debenture, or in lieu of or in substitution for a lost, stolen
or destroyed Debenture, a new Debenture for the principal amount of this Debenture so mutilated, lost, stolen or destroyed, but
only upon receipt of evidence of such loss, theft or destruction of such Debenture, and of the ownership hereof, reasonably satisfactory
to the Company, together with such instruments of indemnity (which in no event shall include the posting of any bond) as the Company
may reasonably request.

 

    	23

     

    

 

e)        Governing
Law. All questions concerning the construction, validity, enforcement and interpretation of this Debenture shall be governed
by and construed and enforced in accordance with the internal laws of the State of New York, without regard to the principles of
conflict of laws thereof. Each party agrees that all legal proceedings concerning the interpretation, enforcement and defense of
the transactions contemplated by any of the Transaction Documents (whether brought against a party hereto or its respective Affiliates,
directors, officers, shareholders, employees or agents) shall be commenced in the state and federal courts sitting in the City
of New York, Borough of Manhattan (the “New York Courts”). Each party hereto hereby irrevocably submits to the
exclusive jurisdiction of the New York Courts for the adjudication of any dispute hereunder or in connection herewith or with any
transaction contemplated hereby or discussed herein (including with respect to the enforcement of any of the Transaction Documents),
and hereby irrevocably waives, and agrees not to assert in any suit, action or proceeding, any claim that it is not personally
subject to the jurisdiction of such New York Courts, or such New York Courts are improper or inconvenient venue for such proceeding.
Each party hereby irrevocably waives personal service of process and consents to process being served in any such suit, action
or proceeding by mailing a copy thereof via registered or certified mail or overnight delivery (with evidence of delivery) to such
party at the address in effect for notices to it under this Debenture and agrees that such service shall constitute good and sufficient
service of process and notice thereof. Nothing contained herein shall be deemed to limit in any way any right to serve process
in any other manner permitted by applicable law. Each party hereto hereby irrevocably waives, to the fullest extent permitted by
applicable law, any and all right to trial by jury in any legal proceeding arising out of or relating to this Debenture or the
transactions contemplated hereby. If any party shall commence an action or proceeding to enforce any provisions of this Debenture,
then the prevailing party in such action or proceeding shall be reimbursed by the other party for its reasonable and documented
attorneys fees and other costs and expenses incurred in the investigation, preparation and prosecution of such action or proceeding.

 

f)         Waiver.
Any waiver by the Company or the Holder of a breach of any provision of this Debenture shall not operate as or be construed to
be a waiver of any other breach of such provision or of any breach of any other provision of this Debenture. The failure of the
Company or the Holder to insist upon strict adherence to any term of this Debenture on one or more occasions shall not be considered
a waiver or deprive that party of the right thereafter to insist upon strict adherence to that term or any other term of this Debenture
on any other occasion. Any waiver by the Company or the Holder must be in writing.

 

g)        Severability.
If any provision of this Debenture is invalid, illegal or unenforceable, the balance of this Debenture shall remain in effect,
and if any provision is inapplicable to any Person or circumstance, it shall nevertheless remain applicable to all other Persons
and circumstances. If it shall be found that any interest or other amount deemed interest due hereunder violates the applicable
law governing usury, the applicable rate of interest due hereunder shall automatically be lowered to equal the maximum rate of
interest permitted under applicable law. The Company covenants (to the extent that it may lawfully do so) that it shall not at
any time insist upon, plead, or in any manner whatsoever claim or take the benefit or advantage of, any stay, extension or usury
law or other law which would prohibit or forgive the Company from paying all or any portion of the principal of or interest on
this Debenture as contemplated herein, wherever enacted, now or at any time hereafter in force, or which may affect the covenants
or the performance of this Debenture, and the Company (to the extent it may lawfully do so) hereby expressly waives all benefits
or advantage of any such law, and covenants that it will not, by resort to any such law, hinder, delay or impede the execution
of any power herein granted to the Holder, but will suffer and permit the execution of every such as though no such law has been
enacted.

 

    	24

     

    

 

h)        Remedies,
Characterizations, Other Obligations, Breaches and Injunctive Relief. The remedies provided in this Debenture shall be cumulative
and in addition to all other remedies available under this Debenture and any of the other Transaction Documents at law or in equity
(including a decree of specific performance and/or other injunctive relief), and nothing herein shall limit the Holder’s
right to pursue actual and consequential damages for any failure by the Company to comply with the terms of this Debenture. To
the fullest extent permitted by applicable law, no party hereto shall assert, and each party hereby waives, and acknowledges that
no other Person shall have, any claim against any other party hereto, on any theory of liability, for special or punitive damages
arising out of, in connection with, or as a result of, this Debenture, any other Transaction Document or any agreement or instrument
contemplated hereby and thereby or the transactions contemplated hereby and thereby. The Company covenants to the Holder that there
shall be no characterization concerning this instrument other than as expressly provided herein. Amounts set forth or provided
for herein with respect to payments, conversion and the like (and the computation thereof) shall be the amounts to be received
by the Holder and shall not, except as expressly provided herein, be subject to any other obligation of the Company (or the performance
thereof). The Company acknowledges that a breach by it of its obligations hereunder will cause irreparable harm to the Holder and
that the remedy at law for any such breach may be inadequate. The Company therefore agrees that, in the event of any such breach
or threatened breach, the Holder shall be entitled, in addition to all other available remedies, to an injunction restraining any
such breach or any such threatened breach, without the necessity of showing economic loss and without any bond or other security
being required. The Company shall provide all information and documentation to the Holder that is requested by the Holder to enable
the Holder to confirm the Company’s compliance with the terms and conditions of this Debenture.

 

i)          Next
Business Day. Whenever any payment or other obligation hereunder shall be due on a day other than a Business Day, such payment
shall be made on the next succeeding Business Day.

 

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

 

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

 

l)          Secured
Obligation. The obligations of the Company under this Debenture are secured by all assets of the Company pursuant to the Security
Agreement, dated as of February 22, 2019 between the Company and the Secured Parties (as defined in the Security Agreement).

 

    	25

     

    

 

m)        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 the Holder (other than by merger). The Holder may assign any or all of its rights under this Agreement
to any Person with the prior written consent of the Company and provided that such transferee shall agrees in writing to be bound,
with respect to the transferred Securities, by the provisions of the Transaction Documents that apply to the “Holder”;
provided, however, that, in connection with any transfer in whole or in part of this Debenture to an Affiliate of
the Holder, such transfer shall not require the prior written consent of the Company and, in connection with such transfer to an
Affiliate of the Holder, the Holder shall not be required to physically surrender this Debenture to the Company.

 

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

 

(Signature Page Follows)

 

    	26

     

    

 

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

 

 

	 	IDEANOMICS, INC.
	 	 
	 	By:	/s/ Alfred P. Poor
	 	 	Name: 	Alfred P. Poor
	 	 	Title:	Chief Executive Officer

 

	                                                  	Facsimile No. for delivery of Notices:	646-859-7695
	 	 
	 	Email address for delivery of Notices:	apoor@ideanomics.com

 

    	27

     

    

 

ANNEX A

 

NOTICE OF CONVERSION

 

The undersigned hereby
elects to convert principal under the 10% Senior Secured Convertible Debenture due August 22, 2020 of Ideanomics, Inc., a Nevada
corporation (the “Company”), into shares of common stock (the “Common Stock”), of the Company
according to the conditions hereof, as of the date written below. If shares of Common Stock are to be issued in the name of a person
other than the undersigned, the undersigned will pay all transfer taxes payable with respect thereto and is delivering herewith
such certificates and opinions as reasonably requested by the Company in accordance therewith. No fee will be charged to the holder
for any conversion, except for such transfer taxes, if any.

 

By the delivery of
this Notice of Conversion the undersigned represents and warrants to the Company that its ownership of the Common Stock does not
exceed the amounts specified under Section 4(d) of this Debenture, as determined in accordance with Section 13(d) of the Exchange
Act.

 

The undersigned agrees
to comply with the prospectus delivery requirements under the applicable securities laws in connection with any transfer of the
aforesaid shares of Common Stock.

 

Conversion calculations:

 

	 	Date to Effect Conversion:
	 	 
	 	Principal Amount of Debenture to be Converted:
	 	 
	 	Payment of Interest in Common Stock __ yes __ no
	 	If
    yes, $_____ of Interest Accrued on Account of Conversion at Issue.
	 	 
	 	Number of shares of Common Stock to be issued:
	 	 
	 	Signature:
	 	 
	 	Name:
	 	 
	 	Address for Delivery of Common Stock Certificates:
	 	 
	 	Or
	 	 
	 	DWAC Instructions:
	 	 
	 	Broker No:_______________________
	 	Account No:______________________
	 	 

    	28

     

    

 

Schedule 1

 

CONVERSION SCHEDULE

 

The 10% Senior Secured Convertible Debentures
due on August 22, 2020 in the aggregate principal amount of $2,050,000 are issued by Ideanomics, Inc., a Nevada corporation. This
Conversion Schedule reflects conversions made under Section 4 of the above referenced Debenture.

 

Dated:

 

	Date
    of Conversion

    (or for first entry,

    Original Issue Date)	Amount
    of

    Conversion	Aggregate

    Principal

    Amount

    Remaining

    Subsequent to

    Conversion

    (or original

    Principal

    Amount)	Company Attest

	 	 	 	 
	 	 	 	 
	 	 	 	 
	 	 	 	 
	 	 	 	 
	 	 	 	 
	 	 	 	 
	 	 	 	 
	 	 	 	 

 

    	29

     

    

 

Schedule 2

 

ASSIGNMENT FORM

 

(To assign the
foregoing Debenture, execute this form and supply required information. Do not use this form to convert the Debenture.)

 

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

 

 

	Name:	 
	 	(Please Print)
	 	 
	Address:	 
	 	(Please Print)
	 	 
	Phone Number:	 
	 	 
	Email Address:	 
	 	 
	Dated: _______________ __, ______	 
	 	 
	Holder’s Signature:	 	 
	 	 	 
	Holder’s Address:	 	 

 

    	30

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