Document:

Exhibit

Exhibit 4.3

ISSUING AND PAYING 
AGENCY AGREEMENT
between
FIRST COMMONWEALTH BANK, 
as Issuer,
and
U.S. Bank National Association, 
as Calculation Agent, Issuing and Paying Agent and Note Registrar
May 21, 2018
THIS ISSUING AND PAYING AGENCY AGREEMENT, made and dated as of May 21, 2018 (this “Agreement”), between First Commonwealth Bank, a Pennsylvania bank and trust company national banking association, as issuer (the “Issuer”), and U.S. Bank National Association, as the calculation agent, issuing and paying agent and note registrar (hereinafter sometimes referred to, in each such capacity, the “Agent”).
WHEREAS, the Issuer proposes initially to issue $50,000,000 aggregate principal amount of its 4.875% Fixed-to-Floating Rate Subordinated Notes Due 2028 and $50,000,000 aggregate principal amount of its 5.500% Fixed-to-Floating Rate Subordinated Notes Due 2033 (each a “Note,” and, collectively, the  “Notes”) pursuant to the offering circular, dated May 16, 2018 (the “Offering Circular”), in transactions that are exempt from registration under the Securities Act of 1933, as amended (the “Securities Act”) pursuant to Section 3(a)(2) of the Securities Act.
NOW, THEREFORE, in consideration of the covenants and agreements made herein, the parties hereto agree as follows:
Section 1.Definitions.  The words and terms used herein unless otherwise defined herein shall have the respective meanings assigned to such terms in the Notes.
Section 2.    Appointment and Acceptance.  The Issuer hereby appoints U.S. Bank National Association, as Calculation Agent, Issuing and Paying Agent and Note Registrar with respect to the Notes, upon the terms and conditions set forth herein, and U.S. Bank National Association hereby accepts such appointment and agrees to perform all of the duties of Issuing and Paying Agent and Note Registrar in accordance with the terms of the Notes and this Agreement.
Section 3.    Form of Note Certificates.  The Issuer shall deliver to the Agent completed Notes executed by manual or facsimile signature of an officer of the Issuer duly authorized to execute the Notes together with an order requesting the Agent to authenticate such Notes (an “Authentication Order”).  Such Notes will be in such form as the Issuer shall deliver to the Agent.

Any Note bearing the manual or facsimile signature of a person who is duly authorized to execute such Note on the date such signature is affixed shall bind the Issuer after the completion thereof by the Agent notwithstanding that such person shall have ceased to hold his or her office on the date such Note is authenticated and delivered by the Agent.
Unless the Issuer notifies the Agent to the contrary, all Notes will be represented by one note certificate, hereinafter called the “Global Note.”  The Global Note shall be registered in the name of a nominee of The Depository Trust Company (“DTC”), as Depositary.  Beneficial interests in the Global Note will be shown on, and transfers thereof will be effected only through, records maintained by DTC and its participants.
Section 4.    Certificate of Authorized Representatives of the Issuer.  The Issuer shall furnish the Agent with a certificate of the Issuer certifying the incumbency and specimen signatures of representatives of the Issuer authorized to instruct the Agent regarding the completion and delivery of the Notes (each, an “Authorized Representative”).  The Agent shall have no responsibility to the Issuer to determine whether a signature of an Authorized Representative is genuine if such signature resembles the specimen signature of such Authorized Representative on such certificate.
Section 5.    Duties of Issuing Agent:  Completion, Authentication and Delivery.
(a)    The Global Note shall be issued and delivered in accordance with the Blanket Letter of Representations from the Issuer to DTC, dated as of May 4, 2018. All instructions regarding the completion and delivery of the Global Note shall be given by an Authorized Representative by facsimile or other means acceptable to the Agent.  All Authentication Orders with respect to the completed Global Note delivered for authentication to the Agent shall be in writing and shall be executed by an Authorized Representative.  Upon receipt of instructions as described above, the Agent shall:
(1)    manually authenticate the Global Note by any one of the officers or employees of the Agent duly authorized and designated by it for such purpose; and
(2)    hold the Global Note as custodian for DTC.
(b)    The Agent shall incur no liability in acting hereunder upon any instructions or Authentication Order contemplated hereby which the Agent believed in good faith to have been given by an Authorized Representative.
(c)    Each instruction or Authentication Order given to the Agent in accordance with this Section 5 shall constitute a representation and warranty to the Agent by the Issuer that the issuance and delivery of the Note or Notes to which the instruction or Authentication Order relates has been duly and validly authorized by the Issuer, that such Note or Notes when completed, authenticated and delivered pursuant hereto, will constitute the legal, valid and binding obligation of the Issuer, and that the Agent’s appointment to act for the Issuer hereunder has been duly authorized by all necessary corporate action of the Issuer.

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Section 6.    Duties of Note Registrar:  Registration, Registration of Transfer and Exchange.  The Agent, in its capacity as Note Registrar, shall, so long as any of the Notes remain outstanding, subject without limitation to Section 3 above, maintain all records as may be customary or provided to it and shall:
(a)    keep at its Paying Agent Office in St. Paul, Minnesota (the “Paying Agent Office”), a register (the “Note Register”) in such form as the Agent may determine, in which, subject to reasonable regulations as it may prescribe, it shall provide for the registration of Notes and of transfers of Notes;
(b)    maintain records showing for each outstanding Note the principal amount and other terms thereof; all subsequent transfers and changes of ownership thereof; and the name, address and tax identification number of the registered holder of such Note (each, a “Holder”);
(c)    record any transfer of Notes the Issuer has approved, it being understood that such approval shall be based solely on matters relating to compliance with federal and state securities laws;
(d)    prepare all such lists of Holders as may be required by the Issuer or any person needing such information and so authorized in writing by the Issuer; and
(e)    during regular office hours and upon reasonable prior written notice, make the Note Register available to the Issuer or the Issuer’s duly appointed employee or agent; provided that the Agent shall have no responsibility or liability for any aspect of the records relating to or payments made on account of beneficial ownership interests in the Global Note or for maintaining, supervising or reviewing any records relating to such beneficial ownership interests, and it shall be fully protected in acting or refraining from acting on any such information provided by DTC.
The Issuer, the Agent and any agent of the Issuer or the Agent may treat the person in whose name a Note is registered (which in the case of a Global Note, shall be DTC or its nominee) as the absolute owner and Holder of such Note for all purposes whatsoever, and none of the Issuer, the Agent or any agent of any of them shall be affected by notice to the contrary.  Any reference herein and in any Note to the term “Holder” of a Note or “registered holder” shall be to the person in whose name a Note is registered in the register maintained for such purposes pursuant to Section 6 hereof.  Neither any members of, or participants in, DTC (“Agent Members”) nor any other persons on whose behalf Agent Members may act shall have any rights under this Agreement with respect to any Global Note registered in the name of DTC or any nominee thereof, or under any such Global Note.  Notwithstanding the foregoing, nothing herein shall prevent the Issuer, the Agent or any agent of the Issuer or the Agent from giving effect to any written certification, proxy or other authorization furnished by DTC or such nominee, as the case may be, or impair, as between DTC, its Agent Members and any other person on whose behalf an Agent Member may act, the operation of customary practices of such persons governing the exercise of the rights of a Holder of any Global Note.  Neither the Agent nor the Issuer shall have any responsibility for any actions taken or not taken by DTC.

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Upon surrender for registration of transfer of any Note at the Paying Agent Office, the Issuer shall execute, and the Agent shall authenticate and deliver, in the name of the designated transferee or transferees, one or more new Notes of authorized denominations (which in no case may be less than $250,000 and integral multiples of $1,000 in excess thereof) and of a like tenor and aggregate principal amount; provided that, unless and until it is exchanged in whole or in part for individual Notes represented thereby, the Global Note may not be transferred except as a whole by DTC to a nominee of DTC, or by a nominee of DTC to DTC or another nominee of DTC, or by DTC or any such nominee to a successor depositary or a nominee of such successor depositary.
If (i) DTC notifies the Issuer in writing that it is unwilling or unable to act as Depositary or DTC ceases to be a clearing agency registered under the Securities Exchange Act of 1934, as amended, and a successor depositary is not appointed by the Issuer within 90 days, (ii) the Issuer, at its option, notifies the Agent, in writing that it elects to cause the issuance of Notes in definitive form or (iii) any event shall have happened and be continuing that, after notice or lapse of time or both, would constitute an Event of Default with respect to the Notes, then, upon surrender by DTC or a successor depositary of the Global Notes, the Agent shall authenticate and deliver Notes, upon receipt of instructions from the Issuer, of like tenor and terms in definitive form in an aggregate principal amount equal to the principal amount of the Global Note outstanding in exchange for such Global Note, to each person that DTC or a successor depositary identifies as the beneficial owner of the related Notes.
Upon the exchange of the Global Note for Notes in definitive form upon the occurrence of any of the events described above, the Global Note shall be cancelled by the Agent.  Notes issued in exchange for the Global Note shall be registered in such names and in such authorized denominations, and delivered to such addresses, as DTC, pursuant to instructions from its direct or indirect participants or otherwise, shall instruct the Agent in writing.  The Agent shall deliver such Notes to the persons in whose names such Notes are registered or to DTC, in fully registered form without coupons in denominations of $250,000 or any amount in excess thereof that is an integral multiple of $1,000.  Such Notes may not subsequently be exchanged by a Holder for Notes in denominations of less than $250,000.
In case any Note shall at any time become mutilated, destroyed, lost or stolen and such Note or evidence satisfactory to the Issuer of the loss, theft or destruction thereof (together with indemnity satisfactory to the Agent and the Issuer and such other documents or proof as may be required by the Agent and the Issuer) shall be delivered to the Agent and the Issuer, the Agent shall authenticate and deliver, upon receipt of instructions from the Issuer, a new Note of like tenor in exchange for the Note so mutilated, or in lieu of the Note so destroyed or lost or stolen.
Section 7.    Duties of Paying Agent:  Payment of Notes; Interest.  
(a)     Payment of principal (and premium, if any) and interest on the Notes shall be made by the Agent in the manner and on the dates specified in the Notes from funds deposited by the Issuer with the Agent for such payments as provided in Section 10.  The Agent shall have no obligation to use its own funds for any such payment of principal, premium, if any, or interest on the Notes.  Payments due at the maturity or redemption of a Note shall be made only upon 

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presentation and surrender of such Note.  Any money that the Issuer pays to the Agent for the purpose of making payments on the Notes and that remains unclaimed two years after the payments were due will, at the Issuer’s written request, be returned to it.  After that time, any Holders of such Notes can only look to the Issuer for payment on such Notes. 
(b)     The Issuer may appoint a calculation agent (the “Calculation Agent”), which Calculation Agent will calculate the interest payable for each Interest Payment Date that the Notes shall accrue interest at a floating rate in accordance with the terms of the Notes.  The Calculation Agent shall calculate the interest payable in accordance with the terms of the Notes and absent manifest error, such interest calculation determination shall be binding and conclusive on the Holders of the Notes and the Issuer.  Promptly following each Regular Record Date (as defined in the Note), the Calculation Agent will advise the Issuer of the amount of interest (to the extent then known) due on the next succeeding Interest Payment Date (as defined in the Note); provided, however, the Calculation Agent shall have no responsibility to determine or calculate any premium due on the Notes or a make-whole amount due and owing on the Notes, if any.  On the date hereof and unless and until the Issuer appoints a new Calculation Agent, the Agent shall serve as Calculation Agent, subject to the terms and conditions contained herein.  If at any time the Agent is not acting as the Calculation Agent with respect to the Notes, the Agent will give any appointed Calculation Agent, which may include the Issuer, written notice of each Interest Payment Date with respect to such Note at least ten Business Days prior to such Interest Payment Date.
Section 8.    Optional Redemption. In the event the Issuer elects to redeem any Notes in whole or in part, the Issuer shall give written notice to the Agent of the principal amount of such Notes to be so redeemed in accordance with the terms set forth in the Notes. In any such written notice, (a) if certificated notes are to be redeemed, the Issuer shall identify such notes by specifying the interest rate or formula pursuant to which interest is calculated on such notes, the Interest Payment Dates, the stated maturity date and redemption terms or (b) if book-entry notes are to be redeemed, the Issuer shall identify such notes by specifying the CUSIP number assigned to the Global Note or notes representing such notes. The Agent shall cause any such notice of redemption to be forwarded to the Holders of the Notes to be redeemed in accordance with the terms set forth in the Notes in the name and at the expense of the Issuer. Whenever less than all of the Notes of like tenor and terms are to be redeemed, (a) if such Notes are Global Notes held by the Agent as custodian for the Depositary or its nominee, the Agent shall reduce the principal amount of one or more Global Notes, by the amount of such redemption, by means of an appropriate adjustment on the records of the Agent, subject to the rules and procedures of the Depositary, or (b) in the case of all other Notes, the Agent shall select the Notes to be so redeemed ratably among Holders. Any Note which is to be redeemed in part only pursuant to clause (b) of the preceding sentence shall be surrendered to the Paying Agent Office, and the Issuer shall execute, and upon receipt of instructions from an Authorized Representative of the Issuer, the Agent shall authenticate and deliver to the Holder of such Note, without service charge, a new Note of like tenor and terms, of any authorized denomination as requested by such Holder, in an aggregate principal amount equal to and in exchange for the unredeemed portion of the principal of such Note so surrendered.       

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Section 9.    Proceeds of Sale of Notes. Proceeds received in payment for the Notes are to be in immediately available funds and shall be immediately credited to an account designated in writing by the Issuer to the Issuing and Paying Agent and the Note Registrar and maintained by the Issuer. Subject to the availability of funds, upon receipt of instructions from an Authorized Representative of the Issuer, proceeds from the sale of Notes may, prior to the time such proceeds are received, be used in payment of the principal of, and premium, if any, and interest on, other Notes of the Issuer presented for payment on the Maturity Date or any earlier date on which the principal thereof is due and payable, or be transferred for credit to the account of the Issuer at another bank.  
Section 10.    Deposit of Funds.  The Issuer shall deposit with the Agent by 9:30 a.m., New York time (i) on each Interest Payment Date (as such term is defined in such Note) of a Note an amount in immediately available funds sufficient to pay the interest due on such date and (ii) on the Maturity Date (as such term is defined in such Note) or earlier redemption date an amount in immediately available funds sufficient to pay the principal of such Note, the premium due thereon, if any, and the interest accrued thereon to, but excluding, such Maturity Date or redemption date, as the case may be.  The Agent shall clearly identify in its books and records funds relating to the Notes.
Section 11.    Fees and Expenses of the Agent.  The Issuer shall pay such fees and expenses of the Agent for the performance of its duties as Issuing and Paying Agent and Note Registrar hereunder as may be mutually agreed upon from time to time in writing and the Issuer agrees promptly to pay such compensation and to reimburse the Agent for the reasonable out-of-pocket documented expenses (provided however that the Agent's reasonable counsel fees and expenses in connection with the issuance shall not exceed $10,000) incurred by it in connection with or arising out of its services hereunder, except any such expense, disbursement or advance as may be attributable to its gross negligence or willful misconduct, and the Agent shall provide the Issuer with reasonable notice of any expenditure incurred that is not in the ordinary course of business.
Section 12.    Conditions.  The Agent accepts its obligations herein set forth upon the terms and conditions hereof, including the following, to all of which the Issuer agrees:
(a)    Agency.  The Agent shall not be liable for any costs, expenses, damages, liabilities or claims hereunder, except to the extent directly arising out of the Agent’s gross negligence or willful misconduct, as finally determined by a court of competent jurisdiction.  In acting under this Agreement and in connection with the Notes, the Agent is acting solely as agent of the Issuer and does not assume any responsibility for the correctness of the recitals in the Notes (except for the correctness of the statement in its certificate of authentication thereon) or any obligation or relationship of agency or trust, for or with any of the owners or Holders of the Notes.  Nothing in this Agreement shall create a fiduciary relationship between the Agent, any Holders of the Notes or any other party.
(b)    Advice of Counsel.  The Agent may consult with Issuer’s counsel or other independent counsel satisfactory to them, and the advice or opinion of such counsel shall be full 

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and complete authorization and protection in respect of any action taken, suffered or omitted by it hereunder in good faith and in reliance thereon.
(c)    Reliance.  The Agent may rely, and shall be protected in acting or refraining from acting, upon any resolution, certificate, statement, instrument, opinion, report, notice, request, direction, consent, order, bond debenture, note, other evidence of indebtedness or other paper or document delivered to it or believed by it to be genuine and to have been signed or presented by the proper party or parties.  The Agent shall not be bound to make any investigation into the facts or matters stated in any resolution, certificate, statement, instrument, opinion, report, notice, request, direction, consent, order, bond, debenture, note, other evidence of indebtedness or other paper or document.
(d)    Interest in the Notes, etc.  The Agent, in its individual or any other capacity, may become the owner or pledgee of the Notes and may otherwise deal with the Issuer with the same rights as it would have if it were not the Agent.
(e)    Non-Liability for Interest.  The Agent shall be under no liability for interest on any money received by it hereunder except as otherwise agreed with the Issuer.
(f)    Certifications.  Whenever in the administration of this Agreement the Agent shall deem it desirable that a matter be proved or established prior to taking, suffering or omitting any action hereunder, the Agent (unless other evidence be herein specifically prescribed) may, in the absence of bad faith on its part, rely upon a certificate delivered to the Agent and signed by the President, the Chief Executive Officer, the Chief Financial Officer, an Executive Vice President, the Treasurer, the Corporate Secretary, an Assistant Secretary or any Attorney-in-Fact of the Issuer.
(g)    No Implied Obligations.  The duties and obligations of the Agent, with respect to matters governed by this Agreement, shall be determined solely by the express provisions hereof, and the Agent shall not be liable except for the performance of such duties and obligations as are specifically set forth in this Agreement and the Notes, as applicable, and no implied covenants or obligations shall be read into this Agreement or the Notes against the Agent.  No provision of this Agreement shall require the Agent to expend or risk its own funds or otherwise incur any financial liability in the performance of any of its duties hereunder, or in the exercise of any of its rights or powers, if it shall have reasonable grounds for believing that repayment of such funds or adequate indemnity against such risk or liability is not reasonably assured to it.
(h)    Enforceability of Rights.  The rights, privileges, protections, immunities and benefits given to the Agent, including, without limitation, its right to be indemnified, are extended to, and shall be enforceable by, the Agent in each of its capacities hereunder, and to each agent, custodian and other person employed to act hereunder.
(i)    Agents.  The Agent may execute any of the powers hereunder or perform any duties hereunder either directly or by or through agents or attorneys and the Agent shall not 

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be responsible for any misconduct or negligence on the part of any agent or attorney appointed with due care by it hereunder.
(j)    Occurrences Beyond Reasonable Control.  In no event shall the Agent be responsible or liable for any failure or delay in the performance of its obligations hereunder, arising out of or caused by, directly or indirectly, forces beyond its control, including, without limitation, strikes, work stoppages, accidents, acts of war or terrorism, civil or military disturbances, nuclear or natural catastrophes or acts of God, and interruptions, loss or malfunctions of utilities, communications or computer (software and hardware) services (it being understood that the Agent shall maintain a business continuity plan and otherwise use reasonable efforts which are consistent with accepted practices in the banking industry to avoid and mitigate the effects of such occurrences and to resume performance as soon as practicable under the circumstances).
(k)    Damages.  In no event shall the Agent be responsible or liable for special, indirect, punitive or consequential loss or damage of any kind whatsoever (including, but not limited to, loss of profit) irrespective of whether the Agent has been advised of the likelihood of such loss or damage and regardless of the form of action.
(l)    Disclaimer.  The recitals contained herein and in the Notes, except the Agent’s certificates of authentication, shall be taken as the statements of the Issuer, and the Agent (or any person authorized by the Agent to act on behalf of the Agent to authenticate the Notes (an “Authenticating Agent”)) assumes no responsibility for their correctness.  The Agent makes no representations as to the validity or sufficiency of this Agreement or of the Notes.  The Agent or any Authenticating Agent shall not be accountable for the use or application by the Issuer of the Notes or the proceeds thereof.
(m)    Judicial Orders.  If at any time the Agent is served with any judicial or administrative order, judgment, decree, writ or other form of judicial or administrative process which in any way affects this Agreement or the Notes (each, an “Order” and including, but not limited to, orders of attachment or garnishment or other forms of levies or injunctions or stays relating to the transfer of funds), the Agent shall use reasonable efforts to provide the Issuer with written notice of Agent’s receipt of service as promptly as practicable under the circumstances (unless prohibited by applicable law or such Order), so that Issuer may, at its option, decide whether to seek a modification of any such Order.  The Agent agrees that it will reasonably cooperate in all reasonable respects with Issuer’s efforts to obtain such modification.  The Agent is authorized to comply with any such Order (regardless of whether Issuer successfully obtains a modification of the Order should it seek to do so) in any manner as the Agent or its legal counsel of its own choosing deems appropriate; provided, however, that the Agent shall delay compliance with an Order until any proceedings instituted by Issuer seeking modification of the Order have been resolved or until (based on the advice of Agent’s legal counsel) further delay in complying with the Order would expose Agent to penalties or sanctions for its failure to comply or would adversely affect the Agent’s ability to comply.  If the Agent complies with any Order in accordance with the provisions of this paragraph, the Agent shall not be liable to any of the 

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parties hereto or to any other person or entity even though such Order may be subsequently modified or vacated or otherwise determined to have been without legal force or effect.
(n)    Taxes.  In order to comply with applicable tax laws (inclusive of rules, regulations and interpretations promulgated by competent authorities) related to this Agreement and the Notes in effect from time to time (“Applicable Law”) that a foreign financial institution, issuer, trustee, paying agent or other party is or has agreed to be subject to, the Issuer agrees (i) to provide to the Agent sufficient information about the parties and/or transactions (including any modification to the terms of such transactions) so the Agent can determine whether it has tax related obligations under Applicable Law and (ii) that the Agent shall be entitled to make any withholding or deduction from payments to the extent necessary to comply with Applicable Law for which the Agent shall not have any liability.  The terms of this Section 12(n) shall survive the termination of this Agreement.
(o)    Calculations.  Except as otherwise provided herein, the Agent shall not be responsible for and accepts no liability with respect to determining, calculating or confirming any date, value or amount related to the Notes.  It shall be the responsibility of the Issuer to notify the Agent in writing of same in timely fashion to the extent the Issuer has such information and to the extent the Agent is required to have such information to perform the duties and obligations of the Agent set forth herein or in the Notes.
Section 13.    Indemnification.  Notwithstanding any satisfaction or discharge of any Notes, the Issuer shall indemnify the Agent and its directors, officers, agents and employees against any and all loss, liability, costs, damages, claims, actions, expenses or demands which it may incur or sustain or which may be made against it in connection with its appointment or the exercise of its powers and duties hereunder as well as the reasonable and documented costs, including the expenses and fees of counsel in defending any claim, action or demand, including any claim under this Section 13 (regardless of whether such claim, action or demand is brought by the Issuer), except such as may result from the Agent’s willful misconduct or gross negligence, as finally determined by a court of competent jurisdiction.  The Agent shall incur no liability and shall also be indemnified and held harmless by the Issuer for, or in respect of, any actions taken or suffered to be taken in good faith by the Agent in accordance herewith and in reliance upon the written (i) opinion or advice of counsel, (ii) instructions that are believed, in good faith, to be duly authorized by the Issuer, or (iii) that officers’ certificate, dated as of the date hereof, executed by officers of the Issuer and delivered to the Agent on the date hereof.
Section 14.    Resignation or Removal of the Agent.
(a)    Except as provided below, the Agent may, at any time, resign as Calculation Agent, Note Registrar, as Issuing Agent or as Paying Agent, by giving written notice to the Issuer of its intention to resign from any or all such offices, specifying the date on which its desired resignation shall become effective; provided that such notice shall be given not less than 45 days prior to the said effective date, unless the Issuer otherwise agrees in writing.  Except as provided below, the Agent may be removed from any or all of the offices to which it is hereby appointed by the Issuer upon delivering to the Agent an instrument in writing signed by the 

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Issuer specifying such removal and the date when such removal shall become effective (such effective date being at least 20 days after said filing).
(b)    If at any time the Agent shall resign or be removed from any or all of the offices to which it is hereby appointed, then a successor Calculation Agent, Note Registrar, Issuing Agent or Paying Agent, as the case may be, shall be appointed by the Issuer by an instrument in writing delivered to the successor Note Registrar, Issuing Agent or Paying Agent, as the case may be.  Upon the appointment as aforesaid of a successor Note Registrar, Issuing Agent or Paying Agent, as the case may be, and acceptance by the latter of such appointment, the former Note Registrar, Issuing Agent or Paying Agent, as the case may be, shall cease to hold such office.
(c)    Any successor Calculation Agent, Note Registrar, Issuing Agent or Paying Agent appointed hereunder shall execute and deliver to its predecessor and the Issuer an instrument accepting such appointment hereunder, and thereupon such successor Calculation Agent, Note Registrar, Issuing Agent or Paying Agent, without any further act, deed or conveyance, shall become vested with all the authority, rights, powers, immunities, duties and obligations of such predecessor with like effect as if originally named as the Calculation Agent, Note Registrar, Issuing Agent or Paying Agent hereunder, and such predecessor shall thereupon become obligated to transfer and deliver, and such successor shall be entitled to receive, copies of any relevant records maintained by such predecessor Note Registrar, Issuing Agent or Paying Agent.
(d)    Any corporation into which the Agent may be merged or converted or any corporation with which the Agent may be consolidated or any corporation resulting from any merger, conversion or consolidation to which the Agent shall be a party shall, to the extent permitted by applicable law, be the successor Calculation Agent, Note Registrar, Issuing Agent or Paying Agent under this Agreement without the execution or filing of any paper or any further act on the part of any of the parties hereto.  Notice of any such merger, conversion or consolidation shall forthwith be given to the Issuer.
(e)    The provisions of Sections 11 and 13 hereof shall survive any resignation or removal hereunder and the termination of this Agreement with respect to matters occurring prior to any such resignation or removal and the termination of this Agreement.
Section 15.    Event of Default Notification.  The Issuer will promptly notify the Agent upon the occurrence of an Event of Default or of the curing of an Event of Default, and the Issuer will provide copies of any such notice of the occurrence of an Event of Default or the curing of an Event of Default to the Agent, whereupon the Agent will promptly mail by first-class mail, postage prepaid, copies of such notice to the Holders of the Notes in the Note Register at their respective addresses appearing in the Agent’s records.  The Agent shall have no obligation to act as a fiduciary to the Holders of the Notes (or any other party) and shall have no duty to enforce this Agreement or the Notes against the Issuer.
Section 16.    Notices.  All notices, instructions and communications between the parties hereto in connection with this Agreement shall be delivered in person, sent by letter, facsimile or 

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other method acceptable to the recipient, in the case of the Issuer, to it at 601 Philadelphia Street, Indiana, Pennsylvania 15701, Attention:  Matthew C. Tomb, Executive Vice President, Chief Risk Officer and General Counsel, with a copy to Squire Patton Boggs (US) LLP, 201 E. Fourth Street, Suite 1900, Cincinnati, Ohio 45202, Attention:  James J. Barresi, and in the case of the Agent, to it at 60 Livingston Avenue, St. Paul, Minnesota 55107, Attention: Global Corporate Trust Services.
The Agent shall have the right to rely upon and comply with instructions and directions sent by e-mail, facsimile and other similar unsecured electronic methods by persons believed by the Agent to be authorized to give instructions and directions on behalf of the Issuer.  The Agent shall not have any duty or obligation to verify or confirm that the person who sent such instructions or directions is, in fact, a person authorized to give instructions or directions on behalf of the Issuer; and the Agent shall not have any liability for any losses, liabilities, costs or expenses incurred or sustained by the Issuer as a result of such reliance upon or compliance with such instructions or directions.  The Issuer agrees to assume all risks arising out of the use of such electronic methods to submit instructions and directions to the Agent, including without limitation the risk of the Agent acting on unauthorized instructions, and the risk of interception and misuse by third-parties.
Section 17.    Successors and Assigns.  The rights, duties and obligations of the Issuer and the Agent hereunder shall inure, without further act, to their respective successors and assigns.
Section 18.    Amendments.  This Agreement may be amended only by an instrument in writing signed by the Issuer and the Agent.
Section 19.    Counterparts.  This Agreement may be executed in one or more counterparts and, if executed in one or more counterparts, the executed counterparts shall each be deemed to be an original but all such counterparts shall together constitute one and the same instrument.
Section 20.    Governing Law.  THIS AGREEMENT SHALL BE GOVERNED BY, AND INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.
Section 21.    Severability.  In case any provision in this Agreement or in the Notes shall be invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired thereby.
Section 22.    Waiver of Jury Trial.  EACH OF THE AGENT AND THE ISSUER HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT, THE NOTES OR THE TRANSACTIONS CONTEMPLATED HEREBY.

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Section 23.    Jurisdiction.  Each of the Agent and the Issuer submits to the jurisdiction of the courts of the State of New York over any suit, action or proceeding with respect to this Agreement or the transactions contemplated hereby.  Each of the parties waives any objection that it may have to the venue of any suit, action or proceeding with respect to this Agreement or the transactions contemplated hereby in any court of the State of New York or that such suit, action or proceeding brought in a court of the State of New York was brought in an inconvenient court and agrees not to plead or claim the same.
Section 24.    USA Patriot Act.  The parties hereto acknowledge that, in accordance with Section 326 of the USA Patriot Act (Title III of Pub. L. 107-56 (signed into law October 26, 2001)) (as amended, modified or supplemented from time to time, the “USA Patriot Act”), the Agent, like all financial institutions, is required to obtain, verify, and record information that identified each person or legal entity that opens an account.  The parties to this Agreement agree that they will provide the Agent with such information as the Agent may request in order for the Agent to satisfy the requirements of the USA Patriot Act.
Section 25.    No Subordination.  The obligations of the Issuer under Sections 11 and 13 to compensate and indemnify the Agent and to pay or reimburse the Agent for expenses, disbursements and advances shall not be subject to the subordination provisions of the Notes.
[signature page follows]

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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed as of the day and year first above written.

FIRST COMMONWEALTH BANK, 
as Issuer
		
	By:
	/s/ James R. Reske    
Name:  James R. Reske 
Title:    Executive Vice President and Chief Financial Officer

U.S. BANK NATIONAL ASSOCIATION, 
as Issuing and Paying Agent and Note Registrar
		
	By:
	/s/ Donald T. Hurrelbrink     
Name:  Donald T. Hurrelbrink 
Title:    Vice President

[Signature Page to Issuing and Paying Agency Agreement]Exhibit 10.1

 

SECURITIES
PURCHASE AGREEMENT

 

This Securities Purchase
Agreement (this “Agreement”) is dated as of May 17, 2018 (the “Execution Date”), between
Probility Media Corp., a Nevada corporation (the “Company”), and each purchaser identified on the signature
pages hereto (each, including its successors and assigns, a “Purchaser” and collectively the “Purchasers”).

 

WHEREAS, subject to
the terms and conditions set forth in this Agreement and pursuant to an exemption from the registration requirements of Section
5 of the Securities Act contained in Section 4(a)(2) thereof and/or Rule 506(b) 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 words and terms defined elsewhere in this Agreement, for all purposes of this Agreement,
the following terms have the meanings set forth in this Section 1.1:

 

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

 

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

 

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

 

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

 

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

 

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

 

“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 to be issued and sold, in each case, have been satisfied or waived, but in no event later
than the third Trading Day following the Execution Date.

 

 

 

 

    	 	1	 

     

    

 

“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 Olshan Frome Wolosky, LLP.

 

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

 

“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, in an aggregate
amount not to exceed 15% of shares of Common Stock outstanding at any given time, the 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 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 dividends, stock splits or combinations)
or to extend the term of such securities, (c) securities issued pursuant to acquisitions or strategic transactions approved by
a majority of the directors of the Company, provided that any such issuance shall only be to a Person (or to the equityholders
of a Person) which is, itself or through its subsidiaries, an operating company or an owner of an asset in a business synergistic
with the business of the Company and shall provide to the Company additional benefits in addition to the investment of funds, but
shall not include a transaction in which the Company is issuing securities primarily for the purpose of raising capital or to an
entity whose primary business is investing in securities, (d) securities issued pursuant to any purchase money equipment loan or
capital leasing arrangement approved by the Collateral Agent under the Security Agreement, purchasing agent or debt financing from
a commercial bank or similar financial institution, (e) securities under and amendments or modifications to the Company’s
Securities Purchase Agreement and its related documents entered into on November 3, 2017 with the investors thereto (the “Prior
Investors”) or securities under that certain Amendment No. 1 to the Stock Purchase Agreement entered into by the Company
on January 19, 2018, (f) shares of Common Stock in an underwritten public offering in an amount in excess of $2.0 million if the
Company utilizes at least 50% of the proceeds to prepay the Notes in accordance with the Notes’ prepayment terms, (g) shares
of Common Stock issued to vendors, consultants, Company Counsel as compensation for services provided or already contracted for,
or, (h) an equity financing of $10,000,000 or more with any of the parties listed on Annex A participating, which must be approved
by the board of directors of the Company (an “Approved Financing”).

 

 

 

 

    	 	2	 

     

    

 

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

 

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

 

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

 

“Intellectual
Property” means all of the following in any jurisdiction throughout the world: (a) all inventions (whether patentable
or unpatentable and whether or not reduced to practice), all improvements thereto, and all U.S. and foreign patents, patent applications,
and patent disclosures, together with all reissuances, continuations, continuations-in-part, revisions, extensions, and reexaminations
thereof, (b) all trademarks, service marks, brand names, certification marks, trade dress, logos, trade names, domain names, assumed
names and corporate names, together with all colorable imitations thereof, and including all goodwill associated therewith, and
all applications, registrations, and renewals in connection therewith, (c) all copyrights, and all applications, registrations,
and renewals in connection therewith, (d) all trade secrets under applicable state laws and the common law and know-how (including
formulas, techniques, technical data, designs, drawings, specifications, customer and supplier lists, pricing and cost information,
and business and marketing plans and proposals), (e) all computer software (including source code, object code, diagrams, data
and related documentation), and (f) all copies and tangible embodiments of the foregoing (in whatever form or medium).

 

“Intellectual
Property Agreement has the meaning set forth in Section 3.1(p).

 

“Lead Investor”
means Cavalry Fund I LP.

 

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

 

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

 

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

 

“Notes”
mean the 10% Original Issue Discount Senior Secured Convertible Promissory Notes issued to the Purchasers, in the form of Exhibit
A attached hereto, which bear interest at the rate of 5% per annum, shall be secured pursuant to a Security Agreement and shall
be senior as to all Indebtedness except for any notes issued pursuant to any purchase money equipment loan or capital leasing arrangement
approved by the Collateral Agent under the Security Agreement.

 

“Note Conversion
Price” means $0.14 per share, subject to adjustment as provided in the Note.

 

“Participation
Maximum” shall have the meaning ascribed to such term in Section 4.11(a).

 

 

 

 

    	 	3	 

     

    

 

“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.

 

“Pre-Notice”
shall have the meaning ascribed to such term in Section 4.11(b).

 

“Pro Rata
Portion” shall have the meaning ascribed to such term in Section 4.11(e).

 

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

 

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

 

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

 

“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 Shares issuable upon conversion of the Notes and Warrant Shares
issuable upon exercise in full of all Warrants ignoring any exercise limits set forth therein.

 

“Rule 144”
means Rule 144 promulgated by the SEC 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 SEC having substantially the same purpose and effect as such Rule.

 

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

 

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

 

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

 

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

 

“Security
Agreement” means the amended and restated security agreement, in the form of Exhibit D, providing the Purchasers
with a first lien on all of the assets of the Company other than as provided in this Agreement.

 

“Shares”
means the Common Stock issuable upon conversion of the Notes.

 

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

 

 

 

 

 

    	 	4	 

     

    

 

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

 

“Subsequent
Financing” shall have the meaning ascribed to such term in Section 4.11(a).

 

“Subsequent
Financing Notice” shall have the meaning ascribed to such term in Section 4.11(b).

 

“Subsidiary”
means with respect to any entity at any date, any direct or indirect corporation, limited or general partnership, limited liability
company, trust, estate, association, joint venture or other business entity of which (A) more than 50% of (i) the outstanding
capital stock having (in the absence of contingencies) ordinary voting power to elect a majority of the board of directors or other
managing body of such entity, (ii) in the case of a partnership or limited liability company, the interest in the capital
or profits of such partnership or limited liability company or (iii) in the case of a trust, estate, association, joint venture
or other entity, the beneficial interest in such trust, estate, association or other entity business is, at the time of determination,
owned or controlled directly or indirectly through one or more intermediaries, by such entity, or (B) is under the actual control
of the Company.

 

“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, the New York Stock Exchange,
the OTCQB, OTCQX, or the OTC Pink (or any successors to any of the foregoing).

 

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

 

“Transfer
Agent” means VStock Transfer, LLC, and any successor transfer agent of the Company.

 

“Variable
Rate Transaction” shall have the meaning ascribed to such term in Section 4.12.

 

“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 prices for the Common Stock are then reported
on the OTC Pink Marketplace maintained by the OTC Markets Group, Inc. (or a similar organization or agency succeeding to its functions
of reporting prices), the volume weighted average price of the Common Stock on the first such facility (or a similar organization
or agency succeeding to its functions of reporting prices), or (c) in all other cases, the fair market value of a share of Common
Stock as determined by the Board of Directors of the Company.

 

 

 

 

 

    	 	5	 

     

    

 

“Warrants”
means, collectively, the Common Stock purchase warrants delivered to the Purchasers at the Closing in accordance with Section
2.2(a) hereof, in the form of Exhibit B attached hereto.

 

“Warrant Exercise
Price” means $0.175 per share.

 

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

 

ARTICLE II.

PURCHASE AND SALE

 

2.1              Closing.
(a) 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 an aggregate of (i) $1,111,111 face value of 10% original issue discount Notes for a total purchase price of
$1,000,000, and (ii) 5,555,557 Warrants, which is equal to 100% of the Shares issuable upon conversion of the purchased Notes,
for no additional consideration. Each Purchaser shall deliver to the Company, via wire transfer 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 Note and a Warrant as determined pursuant to Section 2.2(a), and the Company
and each Purchaser shall deliver the other items set forth in Section 2.2 deliverable at the Closing. Upon satisfaction
of the covenants and conditions set forth in Sections 2.2 and 2.3, the Closing shall occur at the offices of Company
Counsel or such other location as the parties shall mutually agree.

 

2.2             
Deliveries.

 

(a)              
On or prior to 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 C attached hereto;

 

(iii)           
a Note, convertible at the Note Conversion Price, registered in the name of such Purchaser;

 

(iv)            a Warrant, exercisable at the Warrant Exercise Price, registered in the name of such Purchaser to purchase up to a number
of shares of Common Stock equal to 100% of such Purchaser’s Shares, subject to adjustment as described therein;

 

(v)             a Security Agreement providing the Purchasers with a lien on all of the assets of the Company; and

 

(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)             to the Company, such Purchaser’s Subscription Amount by wire transfer to the Company; and

 

(iii)           
the Lead Investor shall deliver the Security Agreement as collateral agent for the benefit of the Purchasers.

 

 

 

 

    	 	6	 

     

    

 

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 (or, to the extent representations or warranties are qualified by materiality or Material
Adverse Effect, in all respects) on the Closing Date of the representations and warranties of the Purchasers contained herein (unless
as of a specific date therein in which case they shall be accurate as of such date);

 

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

 

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

 

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

 

(i)              the accuracy in all material respects (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 as of a specific date therein);

 

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

 

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

 

(iv)            there shall have been no Material Adverse Effect with respect to the Company since the Execution Date;

 

(v)             from
the Execution Date to the Closing Date trading in the Common Stock shall not have been suspended by the SEC 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;

 

(vi)           the
Prior Investors shall have waived any terms of anti-dilution that would be triggered by the issuance of Notes under this Agreement;
and

 

(vii)         
the promissory notes issued to the Prior Investors shall have been amended such that twenty percent (20%) shall be added
to the outstanding principal amount of each note held by Prior Investors participating in this Agreement in consideration of their
waivers of all of the Company’s prior non-compliance thereunder.

 

 

 

    	 	7	 

     

    

 

ARTICLE III.

REPRESENTATIONS AND WARRANTIES

 

3.1             Representations
and Warranties of the Company. The Company hereby makes the following representations and warranties to each Purchaser as
of the Execution Date:

 

(a)        Subsidiaries.
All of the direct and indirect subsidiaries of the Company are set forth in the SEC Reports. The Company owns, directly or indirectly,
all of the capital stock or other equity interests of each Subsidiary free and clear of any Liens, and all of the issued and outstanding
shares of capital stock of each Subsidiary are validly issued and are fully paid, non-assessable and free of preemptive and similar
rights to subscribe for or purchase securities. If the Company has no subsidiaries, all other references to the Subsidiaries or
any of them in the Transaction Documents shall be disregarded. The Subsidiaries are listed on Schedule 3.1(a).

 

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

 

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

 

 

 

 

 

    	 	8	 

     

    

 

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

 

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

 

(f)        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.
The Shares, when issued upon conversion of the Notes, and the Warrant Shares, when issued in accordance with the terms of the
Warrants, will be validly issued, fully paid and nonassessable, free and clear of all Liens imposed by the Company. The Company
has reserved from its duly authorized capital stock a number of shares of Common Stock issuable pursuant to the Notes and the
Warrants equal to the amount set forth in Section 4.9.

 

(g)       Capitalization.
The capitalization of the Company is as set forth in the SEC Reports. The Company has not issued any capital stock since its most
recently filed periodic report under the Exchange Act, other than pursuant to the exercise of employee stock awards under the
Company’s equity incentive plans, the issuance of shares of Common Stock to employees pursuant to the Company’s employee
stock purchase plans and pursuant to the conversion and/or exercise of Common Stock Equivalents outstanding as of the date of
the most recently filed periodic report under the Exchange Act. No Person has any right of first refusal, preemptive right, right
of participation, or any similar right to participate in the transactions contemplated by the Transaction Documents. Except as
a result of the purchase and sale of the Securities or as set forth on Schedule 3.1(g), there are no outstanding options,
warrants, scrip rights to subscribe to, calls or commitments of any character whatsoever relating to, or securities, rights or
obligations convertible into or exercisable or exchangeable for, or giving any Person any right to subscribe for or acquire, any
shares of Common Stock or the capital stock of any Subsidiary, or contracts, commitments, understandings or arrangements by which
the Company or any Subsidiary is or may become bound to issue additional shares of Common Stock or Common Stock Equivalents or
capital stock of any Subsidiary. 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) and will not result in a right of any holder
of Company securities to adjust the exercise, conversion, exchange or reset price under any of such securities. 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. The Company does not have any stock appreciation rights or “phantom stock”
plans or agreements or any similar plan or agreement. All of the outstanding shares of capital stock of the Company are duly authorized,
validly issued, fully paid and nonassessable, have been issued in compliance with all federal and state securities laws, and none
of such outstanding shares was issued in violation of any preemptive rights or similar rights to subscribe for or purchase securities.
No further approval or authorization of any stockholder, the Board of Directors or others is required for the issuance and sale
of the Securities. There are no stockholders agreements, voting agreements or other similar agreements with respect to the Company’s
capital stock to which the Company is a party or, to the knowledge of the Company, between or among any of the Company’s
stockholders.

 

 

 

    	 	9	 

     

    

 

(h)       SEC
Reports; Financial Statements. The Company has filed all reports, schedules, forms, statements and other documents required
to be filed by the Company under the Securities Act and the Exchange Act, including pursuant to Section 13(a) or 15(d) thereof,
for the two years preceding the Execution Date (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”). 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 SEC with respect thereto as in effect at the time of filing. Such
financial statements have been prepared in accordance with United States generally accepted accounting principles applied on a
consistent basis during the periods involved (“GAAP”), except as may be otherwise specified in such financial
statements or the notes thereto and except that unaudited financial statements may not contain all footnotes required by GAAP,
and fairly present in all material respects the financial position of the Company and its consolidated Subsidiaries as of and
for the dates thereof and the results of operations and cash flows for the periods then ended, subject, in the case of unaudited
statements, to normal, immaterial, year-end audit adjustments.

 

(i)        Material
Changes; Undisclosed Events, Liabilities or Developments. Since the date of the latest audited financial statements included
within the SEC Reports, except as specifically disclosed in a subsequent SEC Report filed prior to the Execution Date, (i) there
has been no event, occurrence or development that has had or that could reasonably be expected to result in a Material Adverse
Effect, (ii) the Company has not incurred any liabilities (contingent or otherwise) other than (A) trade payables and accrued
expenses incurred in the ordinary course of business consistent with past practice and (B) liabilities not required to be reflected
in the Company’s financial statements pursuant to GAAP or disclosed in filings made with the SEC, (iii) the Company has
not altered its method of accounting, (iv) the Company has not declared or made any dividend or distribution of cash or other
property to its stockholders or purchased, redeemed or made any agreements to purchase or redeem any shares of its capital stock
and (v) the Company has not issued any equity securities to any officer, director or Affiliate, except pursuant to existing Company
equity incentive plans. The Company does not have pending before the SEC any request for confidential treatment of information.
Except for the issuance of the Securities contemplated by this Agreement or as set forth on Schedule 3.1(i), no event,
liability, fact, circumstance, occurrence or development has occurred or exists or is reasonably expected to occur or exist with
respect to the Company or its Subsidiaries or their respective businesses, prospects, properties, operations, assets or financial
condition that would be required to be disclosed by the Company under applicable securities laws at the time this representation
is made or deemed made that has not been publicly disclosed at least 1 Trading Day prior to the date that this representation
is made.

 

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

 

 

 

 

 

    	 	10	 

     

    

 

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

 

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

 

(m)      Environmental
Laws.The Company and its Subsidiaries (i) are in compliance with all federal, state, local and foreign laws relating to
pollution or protection of human health or the environment (including ambient air, surface water, groundwater, land surface or
subsurface strata), including laws relating to emissions, discharges, releases or threatened releases of chemicals, pollutants,
contaminants, or toxic or hazardous substances or wastes (collectively, “Hazardous Materials”) into the environment,
or otherwise relating to the manufacture, processing, distribution, use, treatment, storage, disposal, transport or handling of
Hazardous Materials, as well as all authorizations, codes, decrees, demands, or demand letters, injunctions, judgments, licenses,
notices or notice letters, orders, permits, plans or regulations, issued, entered, promulgated or approved thereunder (“Environmental
Laws”); (ii) have received all permits licenses or other approvals required of them under applicable Environmental Laws
to conduct their respective businesses; and (iii) are in compliance with all terms and conditions of any such permit, license
or approval where in each clause (i), (ii) and (iii), the failure to so comply could be reasonably expected to have, individually
or in the aggregate, a Material Adverse Effect.

 

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

 

 

 

 

    	 	11	 

     

    

 

(o)       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, (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) the Lien pertaining to the Bank of the West
and Florida First Capital Finance Corporation, Inc. mortgages. 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.

 

(p)       Intellectual
Property.

 

(i)              The Company owns or possesses or has the right to use pursuant to a valid and enforceable written license, sublicense, agreement,
or permission all Intellectual Property necessary for the operation of the business of the Company as presently conducted. The
Company has provided the Purchaser a listing of each such written license, sublicense, agreement or permission.

 

(ii)             The Intellectual Property does not interfere with, infringe upon, misappropriate, or otherwise come into conflict with, any Intellectual
Property rights of third parties, and the Company has no Knowledge that facts exist which indicate a likelihood of the foregoing.
The Company has not received any charge, complaint, claim, demand, or notice alleging any such interference, infringement, misappropriation,
or conflict (including any claim that the Company must license or refrain from using any Intellectual Property rights of any third
party). To the Knowledge of the Company, no third party has interfered with, infringed upon, misappropriated, or otherwise come
into conflict with, any Intellectual Property rights of the Company.

 

(iii)           The Company has no pending patent applications or applications for registration that it has made with respect to any Intellectual
Property. Schedule 3.1(p) identifies each license, sublicense, agreement, or other permission that the Company has granted
to any third party with respect to any of such Intellectual Property (together with any exceptions). The Company has delivered
to the Purchaser a listing of all such licenses, sublicenses, agreements, and permissions (as amended to date) (“Intellectual
Property Agreements”). Schedule 3.1(p) also identifies each registered and unregistered trademark, service mark,
trade name, corporate name, URLs or Internet domain name used by the Company in connection with its business and which is not licensed
from a third party. With respect to each item of Intellectual Property required to be identified in Schedule 3.1(p):

 

		(A)	The Company owns and possesses all right, title, and interest in and to the item, free and clear
of any Lien, license, or other restriction or limitation regarding use or disclosure;

 

		(B)	The item is not subject to any outstanding injunction, judgment, order, decree, ruling, or charge;

 

		(C)	No Action, claim, or demand is pending or, to the knowledge of the Company, is threatened that
challenges the legality, validity, enforceability, use, or ownership by the Company; and

 

		(D)	The Company has not agreed to indemnify any Person for or against any interference, infringement,
misappropriation, or other conflict with respect to the item.

 

 

 

    	 	12	 

     

    

 

(iv)            Schedule
3.1(p)(iv) identifies each item of Intellectual Property that any third party owns and that the Company uses pursuant to license,
sublicense, agreement, or permission, excluding off-the-shelf software purchased or licensed by the Company. The Company has delivered
to the Purchaser a listing of all such licenses, sublicenses, agreements, and permissions (each as amended to date) (each, a “Licensed
Intellectual Property Agreement”). With respect to each Licensed Intellectual Property Agreement:

 

		(A)	The Licensed Intellectual Property Agreement is legal, valid, binding, enforceable, and in full
force and effect;

 

		(B)	No party to the Licensed Intellectual Property Agreement is in breach or default, and no event
has occurred that with notice or lapse of time would constitute a breach or default or permit termination, modification, or acceleration
thereunder, which as to any such breach, default or event could have a Material Adverse Effect on the Company;

 

		(C)	No party to such Licensed Intellectual Property Agreement has repudiated any provision thereof;

 

		(D)	Except as set forth in such Licensed Intellectual Property Agreement, the Company has not received
written or verbal notice or otherwise has knowledge that the underlying item of Intellectual Property is subject to any outstanding
injunction, judgment, order, decree, ruling, or charge; and

 

		(E)	Except as set forth on Schedule 3.1(p)(iv), the Company has not granted any sublicense or
similar right with respect to the license, sublicense, agreement, or permission.

 

(v)             The
Company has complied with and is presently in compliance with all foreign, federal, state, local, governmental (including, but
not limited to, the Federal Trade Commission and State Attorneys General), administrative, or regulatory laws, regulations, guidelines,
and rules applicable to any personal identifiable information.

 

(vi)            Each Person who participated in the creation, conception, invention or development of the Intellectual Property currently
used in the business of the Company (each, a “Developer”) which is not licensed from third parties has executed one
or more agreements containing industry standard confidentiality, work for hire and assignment provisions, whereby the Developer
has assigned to the Company all copyrights, patent rights, Intellectual Property rights and other rights in the Intellectual Property,
including all rights in the Intellectual Property that existed prior to the assignment of rights by such Person to the Company.
The Company has provided to the Purchaser a complete listing of any such agreements and assignments from each such Developer (collectively,
the “Developer Agreements”).

 

(vii)         
Each Developer has signed a perpetual non-disclosure agreement with the Company. The Company has provided, or will provide
prior to Closing, to the Purchaser a complete listing of any such non-disclosure agreements from each such Person, if any.

 

(q)       Insurance. The Company and the Subsidiaries are insured by insurers of recognized financial responsibility against
such losses and risks and in such amounts as are prudent and customary in the businesses in which the Company and the Subsidiaries
are engaged. Neither the Company nor any Subsidiary has any reason to believe that it will not be able to renew its existing insurance
coverage as and when such coverage expires or to obtain similar coverage from similar insurers as may be necessary to continue
its business without a significant increase in cost.

 

 

 

    	 	13	 

     

    

 

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

 

(s)       Sarbanes-Oxley;
Internal Accounting Controls. Except as disclosed in the SEC Reports, the Company and the Subsidiaries are in compliance with
any and all applicable requirements of the Sarbanes-Oxley Act of 2002 that are effective as of the Execution Date, and any and
all applicable rules and regulations promulgated by the SEC thereunder that are effective as of the Execution Date and as of the
Closing Date. The Company and the Subsidiaries maintain a system of internal accounting controls as set forth in the SEC Reports.
The Company’s certifying officers have evaluated the effectiveness of the disclosure controls and procedures of the Company
and the Subsidiaries as of the end of the period covered by the most recently filed periodic report under the Exchange Act (such
date, the “Evaluation Date”). The Company presented in its most recently filed periodic report under the Exchange
Act the conclusions of the certifying officers about the effectiveness of the disclosure controls and procedures based on their
evaluations as of the Evaluation Date. Since the Evaluation Date, there have been no changes in the internal control over financial
reporting (as such term is defined in the Exchange Act) of the Company and its Subsidiaries that have materially affected, or
is reasonably likely to materially affect, the internal control over financial reporting of the Company and its Subsidiaries.

 

(t)        Certain
Fees. Other than as set forth on Schedule 3.1(t), no brokerage or finder’s fees or commissions are or will be
payable by the Company or any Subsidiary to any broker, financial advisor or consultant, finder, placement agent, investment banker,
bank or other Person with respect to the transactions contemplated by the Transaction Documents. The Purchasers shall have no
obligation with respect to any fees or with respect to any claims made by or on behalf of other Persons for fees of a type contemplated
in this Section that may be due in connection with the transactions contemplated by the Transaction Documents.

 

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

 

(v)       Registration
Rights. No Person has any right to cause the Company or any Subsidiary to effect the registration under the Securities Act
of any securities of the Company or any Subsidiary except as disclosed on Schedule 3.1(v).

 

(w)      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 SEC is contemplating terminating
such registration. The Company has not, in the 12 months preceding the Execution Date, 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. The Common Stock is currently eligible
for electronic transfer through the Depository Trust Company or another established clearing corporation and the Company is current
in payment of the fees to the Depository Trust Company (or such other established clearing corporation) in connection with such
electronic transfer.

 

 

 

    	 	14	 

     

    

 

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

 

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

 

(z)        No
Integrated Offering. Assuming the accuracy of the Purchasers’ representations and warranties set forth in Section 3.2,
neither the Company, nor any of its Affiliates, nor any Person acting on its or their behalf has, directly or indirectly, made
any offers or sales of any security or solicited any offers to buy any security, under circumstances that would cause this offering
of the Securities to be integrated with prior offerings by the Company for purposes of any applicable shareholder approval provisions
of any Trading Market on which any of the securities of the Company are listed or designated.

 

(aa)      Solvency.
Based on the consolidated financial condition of the Company as of the Closing Date, after giving effect to the receipt by the
Company of the proceeds from the sale of the Securities hereunder, (i) the fair saleable value of the Company’s assets exceeds
the amount that will be required to be paid on or in respect of the Company’s existing debts and other liabilities (including
known contingent liabilities) as they mature, (ii) the Company’s assets do not constitute unreasonably small capital to
carry on its business as now conducted and as proposed to be conducted including its capital needs taking into account the particular
capital requirements of the business conducted by the Company, consolidated and projected capital requirements and capital availability
thereof, and (iii) the current cash flow of the Company, together with the proceeds the Company would receive, were it to liquidate
all of its assets, after taking into account all anticipated uses of the cash, would be sufficient to pay all amounts on or in
respect of its liabilities when such amounts are required to be paid. The Company does not intend to incur debts beyond its ability
to pay such debts as they mature (taking into account the timing and amounts of cash to be payable on or in respect of its debt).
The Company has no knowledge of any facts or circumstances which lead it to believe that it will file for reorganization or liquidation
under the bankruptcy or reorganization laws of any jurisdiction within one year from the Closing Date. The SEC Reports set forth
as of the Execution Date all outstanding secured and unsecured Indebtedness of the Company or any Subsidiary, or for which the
Company or any Subsidiary has commitments. For the purposes of this Agreement, “Indebtedness” means (x) any
liabilities for borrowed money or amounts owed in excess of $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. Neither the Company nor any Subsidiary is in default with respect to any Indebtedness.

 

 

 

    	 	15	 

     

    

 

(bb)     Tax
Status. Except for matters that would not, individually or in the aggregate, have or reasonably be expected to result in a
Material Adverse Effect, the Company and its Subsidiaries each (i) has made or filed all United States federal, state and local
income and all foreign income and franchise tax returns, reports and declarations required by any jurisdiction to which it is
subject, (ii) has paid all taxes and other governmental assessments and charges that are material in amount, shown or determined
to be due on such returns, reports and declarations and (iii) has set aside on its books provision reasonably adequate for the
payment of all material taxes for periods subsequent to the periods to which such returns, reports or declarations apply. There
are no unpaid taxes in any material amount claimed to be due by the taxing authority of any jurisdiction, and the officers of
the Company or of any Subsidiary know of no basis for any such claim.

 

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

 

(dd)     Accountants.
The Company’s accounting firm is set forth in the SEC Reports. To the knowledge and belief of the Company, such accounting
firm (i) is a registered public accounting firm as required by the Exchange Act and (ii) has expressed its opinion with respect
to the financial statements included in the Company’s Annual Report for the fiscal year ending October 31, 2017.

 

(ee)     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.

 

(ff)       Acknowledgement
Regarding Purchaser’s Trading Activity. Notwithstanding anything in this Agreement or elsewhere to the contrary (except
for Sections 3.2(f) and 4.14 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, presently may 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 Warrant 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.

 

 

 

 

 

    	 	16	 

     

    

 

(gg)     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, except as noted on Schedule 3.1(t).

 

(hh)     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 Notes, the Shares upon conversion thereof,
the Warrants or the Warrant Shares issuable upon exercise thereof by the Company to the Purchasers as contemplated hereby

 

(ii)       No General Solicitation. Neither the Company nor any person acting on behalf of the Company has offered or sold any
of the Securities by any form of general solicitation or general advertising. The Company has offered the Securities for sale only
to the Purchasers and certain other “accredited investors” within the meaning of Rule 501 under the Securities Act.

 

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

 

(kk)     Notice
of Disqualification Events. The Company will notify the Purchasers in writing, prior to the Closing Date of (i) any Disqualification
Event relating to any Issuer Covered Person and (ii) any event that would, with the passage of time, reasonably be expected to
become a Disqualification Event relating to any Issuer Covered Person, in each case of which it is aware.

 

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

 

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

 

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

 

 

 

 

    	 	17	 

     

    

 

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

 

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

 

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

 

(b)       Understandings
or Arrangements. Such Purchaser is acquiring the Securities as principal for its own account and has no direct or indirect
arrangement or understandings with any other persons to distribute or regarding the distribution of such Securities (this representation
and warranty not limiting such Purchaser’s right to sell the Securities in compliance with applicable federal and state
securities laws). Such Purchaser is acquiring the Securities hereunder in the ordinary course of its business. 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 such 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 such Securities in compliance with applicable federal and state
securities laws).

 

(c)        Purchaser
Status. At the time such Purchaser was offered the Securities, it was, and as of the Execution Date it is, an accredited investor
within the meaning of Rule 501 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 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.

 

 

 

 

    	 	18	 

     

    

 

(e)       Access
to Information. Such Purchaser acknowledges that it has had the opportunity to review the Transaction Documents (including
all exhibits and schedules thereto) and the SEC Reports and has been afforded, subject to Regulation FD, (i) the opportunity to
ask such questions as it has deemed necessary of, and to receive answers from, representatives of the Company concerning the terms
and conditions of the offering of the Securities and the merits and risks of investing in the Securities; (ii) access to information
about the Company and its financial condition, results of operations, business, properties, management and prospects sufficient
to enable it to evaluate its investment; and (iii) the opportunity to obtain such additional information that the Company possesses
or can acquire without unreasonable effort or expense that is necessary to make an informed investment decision with respect to
the investment.  Such Purchaser acknowledges and agrees that neither the Company nor anyone else has provided such Purchaser
with any information or advice with respect to the Securities nor is such information or advice necessary or desired. 

 

(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 avoidance of doubt, nothing contained herein
shall constitute a representation or warranty, or preclude any actions, with respect to the identification of the availability
of, or securing of, available shares to borrow in order to effect Short Sales or similar transactions 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 transaction contemplated hereby.

 

ARTICLE IV.

OTHER AGREEMENTS OF THE PARTIES

 

4.1             
Removal of Legends.

 

(a)        The
Shares, the Warrants and Warrant Shares may only be disposed of in compliance with state and federal securities laws. In connection
with any transfer of Shares, Warrants or Warrant Shares other than pursuant to an effective registration statement, if the Company
or its Transfer Agent requires the transferor thereof to provide an opinion of counsel to the effect that such transfer does not
require registration of such transferred Securities under the Securities Act, then such opinion shall be at the sole cost of the
Company and may be delivered by counsel selected by the transferor.

 

 

 

 

    	 	19	 

     

    

 

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

 

NEITHER THIS SECURITY NOR THE SECURITIES
INTO WHICH THIS SECURITY IS EXERCISABLE 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 EXERCISE 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 “ACCREDITED INVESTOR” 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 Shares or Warrant Shares to a financial institution that is an “accredited
investor” as defined in Rule 501(a) under the Securities Act and who agrees to be bound by the provisions of this Agreement
and, if required under the terms of such arrangement, such Purchaser may transfer pledged or secured Shares or Warrant Shares 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 Shares and Warrant Shares may reasonably request in connection with a pledge or transfer of the
Shares or Warrant Shares.

 

(c)             Certificates evidencing the Shares and the Warrant Shares shall not contain any legend (including the legend set forth in
Section 4.1(b) hereof): (i) while a registration statement covering the resale of such security is effective under the Securities
Act, (ii) following any sale of such Shares or Warrant Shares pursuant to Rule 144, (iii) if such Shares or Warrant Shares are
eligible for sale under Rule 144, without the requirement for the Company to be in compliance with the current public information
required under Rule 144 as to such Shares or Warrant Shares and without volume or manner-of-sale restrictions or (iv) if such legend
is not required under applicable requirements of the Securities Act (including Section 4(a)(1), judicial interpretations and pronouncements
issued by the staff of the SEC) (the “Effective Date”). The Company shall, at its expense, cause its counsel to issue
a legal opinion to the Transfer Agent promptly after the Effective Date if required by the Transfer Agent to effect the removal
of the legend hereunder. If all or any portion of a Note is converted or a Warrant is exercised at a time when there is an effective
registration statement to cover the resale of the Shares or the Warrant Shares, or if such Shares or Warrant Shares may be sold
under Rule 144 and the Company is then in compliance with the current public information required under Rule 144, or if the Shares
or Warrant Shares may be sold under Rule 144 without the requirement for the Company to be in compliance with the current public
information required under Rule 144 as to such Shares or Warrant Shares and without volume or manner-of-sale restrictions or if
such legend is not otherwise required under applicable requirements of the Securities Act (including Section 4(a)(1), judicial
interpretations and pronouncements issued by the staff of the SEC) then such Shares or Warrant Shares shall be issued or reissued
free of all legends. The Company agrees that following the effective date of any registration statement or at such time as such
legend is no longer required under this Section 4.1(c), it will, no later than three (3) Trading Days following the delivery by
a Purchaser to the Company or the Transfer Agent of a certificate representing restricted Shares or Warrant Shares, as applicable,
issued with a restrictive legend (such third Trading Day, the “Legend Removal Date”), deliver or cause to be delivered
to such Purchaser a certificate representing such Shares or Warrant 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 4.1. Certificates for Shares or Warrant 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.

 

 

 

 

    	 	20	 

     

    

 

(d)           
In addition to such Purchaser’s other available remedies, (i) the Company shall pay to a Purchaser, in cash, as partial
liquidated damages and not as a penalty, for each $1,000 of per share purchase price and exercise price, respectively, of Shares
and Warrant Shares (based on the VWAP of the Common Stock on the date such Shares and/or Warrant Shares are submitted to the Transfer
Agent) delivered for removal of the restrictive legend and subject to Section 4.1(c), $5 per Trading Day for each Trading Day after
the Legend Removal Date (increasing to $10 per Trading Day after the 5th Trading Day) until such certificate is delivered without
a legend. In no event shall liquidated damages for any one transaction exceed $1,000.00 for the first ten Trading Days. Nothing
herein shall limit such Purchaser’s right to pursue actual damages for the Company’s failure to deliver certificates
representing any Securities as required by the Transaction Documents, 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, and
(ii) 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, the Company shall pay to such Purchaser, in cash, 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 Warrant 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 Warrant Shares (as the case may be) and ending on the date of such delivery and payment under this Section 4.1(d).

 

(e)           
 In the event a Purchaser shall request delivery of unlegended shares as described in this Section 4.1 and the Company is
required to deliver such unlegended shares, (i) it shall pay all fees and expenses associated with or required by the legend removal
and/or transfer including but not limited to legal fees, transfer agent fees and overnight delivery charges and taxes, if any,
imposed by any applicable government upon the issuance of Common Stock; and (ii) the Company may not refuse to deliver unlegended
shares based on any claim that such Purchaser or anyone associated or affiliated with such Purchaser has not complied with Purchaser’s
obligations under the Transaction Documents, or for any other reason, unless, an injunction or temporary restraining order from
a court, on notice, restraining and or enjoining delivery of such unlegended shares shall have been sought and obtained by the
Company and the Company has posted a surety bond for the benefit of such Purchaser in the amount of the greater of (i) 15% of the
amount of the aggregate purchase price of the Shares and Warrant Shares which is subject to the injunction or temporary restraining
order, or (ii) the VWAP of the Common Stock on the trading day before the issue date of the injunction multiplied by the number
of unlegended shares to be subject to the injunction, which bond shall remain in effect until the completion of the litigation
of the dispute and the proceeds of which shall be payable to such Purchaser to the extent Purchaser obtains judgment in Purchaser’s
favor.

 

4.2             
Furnishing of Information.

 

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

 

 

 

 

    	 	21	 

     

    

 

(b)             At
any time during the period commencing from the six (6) month anniversary of the Execution Date and ending at such time that all
of the Warrant Shares (assuming cashless exercise) 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) for a period of more than 30 consecutive days 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) for a period of more than 30 consecutive days (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 Shares and/or Warrant Shares, an amount in cash equal to two percent (2.0%) of the aggregate Note Conversion Price of such
Purchaser’s Note(s) and/or Warrant Exercise Price of such Purchaser’s Warrants 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 and/or Warrant Shares pursuant to Rule 144.  In no event shall the amount paid
under this section exceed 6.0% of the aggregate Note Conversion Price. 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 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.

 

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(a)(1) of the Securities Act) that would be integrated with the offer or sale of the Securities
for purposes of the rules and regulations of any Trading Market such that it would require shareholder approval prior to the closing
of such other transaction unless shareholder approval is obtained before the closing of such subsequent transaction.

 

4.4             
Securities Laws Disclosure; Publicity. The Company shall, by 5:30 p.m. (New York City time) file a Current Report
on Form 8-K disclosing the material terms of this Agreement, including the Transaction Documents as exhibits thereto, with the
SEC within the time required by the Exchange Act. From and after the filing of the Form 8-K as provided in the preceding sentence,
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
Form 8-K, 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. The Company
and each Purchaser shall consult with each other in issuing any press releases with respect to the transactions contemplated hereby,
and neither the Company nor any Purchaser shall issue any such press release nor otherwise make any such public statement without
the prior consent of the Company, with respect to any press release of any Purchaser, or without the prior consent of each Purchaser,
with respect to any press release of the Company, which consent shall not unreasonably be withheld or delayed, except if such disclosure
is required by law, in which case the disclosing party shall promptly provide the other party with prior notice of such public
statement or communication. 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 SEC 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 the filing of final Transaction
Documents with the SEC 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).

 

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

 

 

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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 4.4, 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 SEC 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. The Company shall use the net proceeds from the sale of the Securities hereunder for working capital
purposes, and except as set forth on Schedule 4.7 hereto, shall not use such proceeds: (a) for the satisfaction of any other
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, (d) in violation of FCPA or OFAC regulations, or (e) to lend money, give credit, or make advances to any officers,
directors, employees or affiliates of the Company.

 

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 (including local counsel, if retained) 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, (b) any action instituted against the Purchaser Parties in any capacity, or any of them
or their respective Affiliates, by any stockholder of the Company who is not an Affiliate of such Purchaser Party, with respect
to any of the transactions contemplated by the Transaction Documents (unless such action is based upon a breach of such Purchaser
Party’s representations, warranties or covenants under the Transaction Documents or any agreements or understandings such
Purchaser Party may have with any such stockholder or any violations by such Purchaser Party of state or federal securities laws
or any conduct by such Purchaser Party which constitutes fraud, gross negligence, willful misconduct or malfeasance) or (c) any
untrue or alleged untrue statement of a material fact contained in any registration statement, any prospectus or any form of prospectus
or in any amendment or supplement thereto or in any preliminary prospectus, or arising out of or relating to any omission or alleged
omission of a material fact required to be stated therein or necessary to make the statements therein (in the case of any prospectus
or supplement thereto, in light of the circumstances under which they were made) not misleading. 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 (in addition to local counsel, if retained). 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 Purchaser Parties shall have the right
to settle any action against any of them by the payment of money provided that they cannot agree to any equitable relief and the
Company, its officers, directors and Affiliates receive unconditional releases in customary form. 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.

 

 

 

    	 	23	 

     

    

 

4.9             
Reservation of Common Stock. As of the Execution Date, the Company has reserved and the Company shall continue to
reserve and keep available at all times in favor of the Purchasers on a pro rata basis based on each Purchaser’s Subscription
Amount, free of preemptive rights, a number of shares of Common Stock equal to the greater of (i) three times the number of shares
of Common Stock issuable upon conversion of the Notes and exercise of the Warrants or, (ii) 19.9% of the outstanding shares of
Common Stock, subject to adjustment for stock splits and dividends, combinations and similar events. In addition to any other remedies
provided by this Agreement or other Transaction Documents, if the Company at any time fails to meet this reservation of Common
Stock requirement within 45 days after written notice from the Holder, it shall pay the Purchasers as partial liquidated
damages and not as a penalty a sum equal to $500 per day for each $100,000 of each Purchaser’s Subscription Amount and it
shall sell to the Lead Investor for $100 a series of preferred stock which contains the power to vote a number of votes equal to
51% of the number of votes eligible to vote at any special or annual meeting of the Company’s shareholders (with the power
to take action by written consent in lieu of a shareholders meeting) for the sole purpose of amending the Company’s Articles
of Incorporation to increase its authorized Common Stock. The Company shall not enter into any agreement or file any amendment
to its Articles of Incorporation (including the filing of a Certificate of Designation) which conflicts with this Section 4.9
while the Notes and Warrants remain outstanding, unless it is in conjunction with, or required by, the Approved Financing.

 

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

 

4.11           
Participation in Future Financing.

 

(a)             From the Execution Date until the date that is the eighteen (18) month anniversary of the Closing Date, upon any issuance
by the Company or any of its Subsidiaries of Common Stock or Common Stock Equivalents for cash consideration, Indebtedness or a
combination of units hereof in a transaction exempt from registration under the Securities Act (a “Subsequent Financing”),
Purchasers shall have the right to participate in up to an amount of the Subsequent Financing equal to 100% of the Subsequent Financing
unless it is the Approved Financing; provided, that the balance of the investors shall be reasonably satisfactory to the Purchasers
(the “Participation Maximum”) on the same terms, conditions and price provided for in the Subsequent Financing. 
At least ten (10) Trading Days prior to the closing of the Subsequent Financing, the Company shall deliver to each Purchaser a
written notice of its intention to effect a Subsequent Financing (“Pre-Notice”), which Pre-Notice shall ask
such Purchaser if it wants to review the details of such financing (such additional notice, a “Subsequent Financing Notice”). 
Upon the request of a Purchaser, and only upon a request by such Purchaser, for a Subsequent Financing Notice, the Company shall
promptly, but no later than two(2) Trading Days after such request, deliver a Subsequent Financing Notice to such Purchaser. 
The Subsequent Financing Notice shall describe in reasonable detail the proposed terms of such Subsequent Financing, the amount
of proceeds intended to be raised thereunder and the Person or Persons through or with whom such Subsequent Financing is proposed
to be effected and shall include a term sheet or similar document relating thereto as an attachment.   

 

(b)             Any Purchaser desiring to participate in such Subsequent Financing must provide written notice to the Company by not later
than 5:30 p.m. (New York City time) on the fifth (5th) Trading Day after all of the Purchasers have received the Pre-Notice
that such Purchaser is willing to participate in the Subsequent Financing, the amount of such Purchaser’s participation,
and representing and warranting that such Purchaser has such funds ready, willing, and available for investment on the terms set
forth in the Subsequent Financing Notice. If the Company receives no such notice from a Purchaser as of such fifth (5th)
Trading Day, such Purchaser shall be deemed to have notified the Company that it does not elect to participate. 

 

 

 

    	 	24	 

     

    

 

(c)             If
by 5:30 p.m. (New York City time) on the fifth (5th) Trading Day after all of the Purchasers have received the Pre-Notice,
notifications by the Purchasers of their willingness to participate in the Subsequent Financing (or to cause their designees to
participate) is, in the aggregate, less than the total amount of the Subsequent Financing, then the Company may effect the remaining
portion of such Subsequent Financing on the terms and with the Persons set forth in the Subsequent Financing Notice. 

 

(d)             If
by 5:30 p.m. (New York City time) on the fifth (5th) Trading Day after all of the Purchasers have received the Pre-Notice,
the Company receives responses to a Subsequent Financing Notice from Purchasers seeking to purchase more than the aggregate amount
of the Participation Maximum, each such Purchaser shall have the right to purchase its Pro Rata Portion (as defined below) of
the Participation Maximum.  “Pro Rata Portion” means the ratio of (x) the Subscription Amount of Securities
purchased on the Closing Date by a Purchaser participating under this Section 4.11 and (y) the sum of the aggregate Subscription
Amounts of Securities purchased on the Closing Date by all Purchasers participating under this Section 4.11.

 

(e)             The
Company must provide the Purchasers with a second Subsequent Financing Notice, and the Purchasers will again have the right of
participation set forth above in this Section 4.11, if the Subsequent Financing subject to the initial Subsequent Financing
Notice is not consummated for any reason on the terms set forth in such Subsequent Financing Notice within thirty (30) Trading
Days after the date of the initial Subsequent Financing Notice.

 

(f)              The
Company and each Purchaser agree that if any Purchaser elects to participate in the Subsequent Financing, the transaction documents
related to the Subsequent Financing shall not include any term or provision whereby such Purchaser shall be required to agree
to any restrictions on trading as to any of the Securities purchased hereunder or be required to consent to any amendment to or
termination of, or grant any waiver, release or the like under or in connection with, this Agreement, without the prior written
consent of such Purchaser.

 

(g)             Notwithstanding
anything to the contrary in this Section 4.11 and unless otherwise agreed to by such Purchaser, the Company shall either
confirm in writing to such Purchaser that the transaction with respect to the Subsequent Financing has been abandoned or shall
publicly disclose its intention to issue the securities in the Subsequent Financing, in either case in such a manner such that
such Purchaser will not be in possession of any material, non-public information, by the tenth (10th) Business Day
following delivery of the Subsequent Financing Notice. If by such tenth (10th) Business Day, no public disclosure regarding
a transaction with respect to the Subsequent Financing has been made, and no notice regarding the abandonment of such transaction
has been received by such Purchaser, such transaction shall be deemed to have been abandoned and such Purchaser shall not be deemed
to be in possession of any material, non-public information with respect to the Company or any of its Subsidiaries.

 

(h)             Notwithstanding
the foregoing, this Section 4.11 shall not apply in respect of (i) an Exempt Issuance, or (ii) a public offering registered
with the SEC.

 

4.12          
Subsequent Equity Sales.

 

(a)           
From the Execution Date until 30 days after the Closing Date neither the Company nor any Subsidiary shall issue, enter into
any agreement to issue or announce the issuance or proposed issuance of any shares of Common Stock or Common Stock Equivalents,
except for Exempt Issuances.

 

 

 

    	 	25	 

     

    

 

(b)           
From the Execution Date until the 18 month anniversary of the Closing Date, the Company will not, without the consent of
the Purchasers, enter into any Equity Line of Credit or similar agreement, nor issue nor agree to issue any common stock, floating
or Variable Priced Equity Linked Instruments nor any of the foregoing or equity with price reset rights (subject to adjustment
for stock splits, distributions, dividends, recapitalizations and the like) (collectively, the “Variable Rate Transaction”).
For purposes hereof, “Equity Line of Credit” shall include any transaction involving a written agreement between
the Company and an investor or underwriter whereby the Company has the right to “put” its securities to the investor
or underwriter over an agreed period of time and at an agreed price or price formula, and “Variable Priced Equity Linked
Instruments” shall include: (A) any debt or equity securities which are convertible into, exercisable or exchangeable
for, or carry the right to receive additional shares of Common Stock either (1) at any conversion, exercise or exchange rate or
other price that is based upon and/or varies with the trading prices of or quotations for Common Stock at any time after the initial
issuance of such debt or equity security, or (2) with a fixed conversion, exercise or exchange price that is subject to being reset
at some future date at any time after the initial issuance of such debt or equity security due to a change in the market price
of the Company’s Common Stock since date of initial issuance, and (B) any amortizing convertible security which amortizes
prior to its maturity date, where the Company is required or has the option to (or any investor in such transaction has the option
to require the Company to) make such amortization payments in shares of Common Stock which are valued at a price that is based
upon and/or varies with the trading prices of or quotations for Common Stock at any time after the initial issuance of such debt
or equity security (whether or not such payments in stock are subject to certain equity conditions). For purposes of determining
the total consideration for a convertible instrument (including a right to purchase equity of the Company) issued, subject to an
original issue or similar discount or which principal amount is directly or indirectly increased after issuance, the consideration
will be deemed to be the actual cash amount received by the Company in consideration of the original issuance of such convertible
instrument. Notwithstanding the foregoing, the Company shall not be prohibited from engaging in any Variable Rate Transaction in
connection with any offering of securities described in clause (e) of the Exempt Issuance definition.

 

(c)           
From the Execution Date until the earlier of (i) date that is the eighteenth month anniversary of the Closing Date or (ii)
such time as no Purchaser holds any Securities, in the event that the Company issues or sells any Common Stock or Common Stock
Equivalents, if a Purchaser then holding Securities purchased under this Agreement reasonably believes that any of the terms and
conditions appurtenant to such issuance or sale are more favorable to such investors than are the terms and conditions granted
to the Purchasers hereunder, upon notice to the Company by such Purchaser within five Trading Days after disclosure of such issuance
or sale, the Company shall amend the terms of this transaction as to such Purchaser only so as to give such Purchaser the benefit
of such more favorable terms or conditions.

 

(d)           
Notwithstanding the foregoing, this Section 4.12 shall not apply in respect of an Exempt Issuance and shall only
apply as to price terms in respect of any rights offering. The Company shall provide each Purchaser with notice of any such issuance
or sale in the manner for disclosure of Subsequent Financings set forth in Section 4.11.

 

4.13         
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 4.4.  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 4.4, 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 4.4, (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 4.4 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 4.4.  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.

 

 

 

    	 	26	 

     

    

 

4.14         
Capital Changes. Until the one year anniversary of the Closing Date, the Company shall not undertake a reverse or
forward stock split or reclassification of the Common Stock without the prior written consent of the Purchasers holding a majority
in interest of the outstanding principal balance of the Notes.

 

4.15         
Conversion and Exercise Procedures. The forms of Conversion Notice and Notice of
Exercise included in the Notes and Warrants set forth the totality of the procedures required of the Purchasers in order to exercise
the Warrants. No additional legal opinion, other information or instructions shall be required of the Purchasers to convert their
Notes or exercise their Warrants. Without limiting the preceding sentences, no ink-original Conversion Notice or Notice of Exercise
shall be required, nor shall any medallion guarantee (or other type of guarantee or notarization) of any Conversion Notice or Notice
of Exercise form be required in order to convert the Notes or exercise the Warrants. The Company shall honor conversions of the
Notes and exercises of the Warrants and shall deliver Shares and Warrant Shares in accordance with the terms, conditions and time
periods set forth in the Transaction Documents.

 

4.16         
DTC Program. For so long as any Warrants are outstanding, the Company will employ as the transfer agent for the Common
Stock and Warrant Shares a participant in the Depository Trust Company Automated Securities Transfer Program and cause the Common
Stock to be transferable pursuant to such program.

 

4.17            
Maintenance of Property. The Company shall keep all of its property, which is necessary or useful to the conduct
of its business, in good working order and condition, ordinary wear and tear excepted.

 

4.18         
 Preservation of Corporate Existence. The Company shall preserve and maintain its corporate existence, rights, privileges
and franchises in the jurisdiction of its incorporation, and qualify and remain qualified, as a foreign corporation in each jurisdiction
in which such qualification is necessary in view of its business or operations and where the failure to qualify or remain qualified
might reasonably have a Material Adverse Effect upon the financial condition, business or operations of the Company taken as a
whole.

 

4.19         
No Registration of Securities. While the Notes are outstanding, the Company will not file any registration statements,
on Form S-8 or otherwise, to register sales of Common Stock, including shares underlying any derivative securities.

 

4.20         
Collateral Agent. Each Purchaser hereby appoints Cavalry Fund I LP as Collateral Agent under the Security Agreement.

 

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 May 31, 2018; provided, however, that no such
termination will affect the right of any party to sue for any breach by any other party (or parties).

 

5.2             
Fees and Expenses. Except as expressly set forth below and in the Transaction Documents to the contrary, each party
shall pay the fees and expenses of its advisers, counsel, accountants and other experts, if any, and all other expenses incurred
by such party incident to the negotiation, preparation, execution, delivery and performance of this Agreement. The Company shall
pay all Transfer Agent fees (including, without limitation, any fees required for same-day processing of any instruction letter
delivered by the Company and any exercise notice delivered by a Purchaser), stamp taxes and other taxes and duties levied in connection
with the delivery of any Securities to the Purchasers. Upon each of the Closing and Additional Closing, the Company agrees to pay
counsel for the Purchasers $25,000 in fees, together with reasonable costs up to a maximum of $5,000 upon receipt of invoices,
including those necessary to provide the Purchasers with a lien on all of the assets of the Company. From the Closing proceeds,
the Purchasers may withhold up to $25,000 in order to pay the fees due its counsel, as well as any costs incurred by such counsel.

 

 

 

    	 	27	 

     

    

 

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 or email attachment at the facsimile number or 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 or email attachment at the facsimile number or email address
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 Subsidiaries,
the Company shall simultaneously file such notice with the SEC pursuant to a Current Report on Form 8-K.

 

5.5             
Amendments; Waivers. Except as provided in the last sentence of this Section 5.5, 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 the Purchasers who purchased at least a majority in interest of the Amendment 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; provided, that
if any amendment, modification or waiver disproportionately and adversely impacts a Purchaser (or group of Purchasers), the consent
of such disproportionately impacted Purchaser (or group of Purchasers) shall also be required. 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 proposed amendment or waiver
that disproportionately, materially and adversely affects the rights and obligations of any Purchaser relative to the comparable
rights and obligations of the other Purchasers shall require the prior written consent of such adversely affected Purchaser, Any
amendment effected in accordance with accordance with this Section 5.5 shall be binding upon each Purchaser and holder of Securities
and the Company. In order to amend the definition of Exempt Issuance, Section 4.11 or Section 4.12, the written consent of the
Company and each Purchaser must be obtained.

 

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 to whom such Purchaser assigns or transfers any Securities, provided that such transferee agrees in writing to be bound,
with respect to the transferred Securities, by the provisions of the Transaction Documents that apply to the “Purchasers.”

 

5.8             
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 and this Section 5.8.

 

 

 

    	 	28	 

     

    

 

5.9             
Governing Law; Exclusive Jurisdiction; Attorneys’ Fees. 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 elsewhere in this Agreement, 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.

 

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 an exercise of a Warrant, the applicable Purchaser shall be required to return any shares of
Common Stock subject to any such rescinded exercise notice concurrently with the return to such Purchaser of the aggregate exercise
price paid to the Company for such shares and the restoration of such Purchaser’s right to acquire such shares pursuant to
such Purchaser’s Warrant (including, issuance of a replacement warrant certificate evidencing such restored right).

 

5.14         
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 without requiring the posting of any bond, at applicants
cost.

 

 

 

 

    	 	29	 

     

    

 

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 the Transaction Documents. The
parties agree that monetary damages may not be adequate compensation for any loss incurred by reason of any breach of obligations
contained in the Transaction Documents 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         
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 including any action
taken by the Collateral Agent as defined by the Security Agreement (whether under this Agreement or the Security Agreement), 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. The Company has elected to provide
all Purchasers with the same terms and Transaction Documents for the convenience of the Company and not because it was required
or requested to do so by any of the Purchasers. It is expressly understood and agreed that each provision contained in this Agreement
and in each other Transaction Document is between the Company and a Purchaser, solely, and not between the Company and the Purchasers
collectively and not between and among the Purchasers.

 

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

 

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

 

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

 

5.21         
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. 

 

 

 

 

    	 	30	 

     

    

 

5.22         
Non-Circumvention. The Company hereby covenants and agrees that the Company will not, by amendment of its Articles
of Incorporation, including any Certificates of Designation, or Bylaws or through any reorganization, transfer of assets, consolidation,
merger, scheme of arrangement, dissolution, issue or sale of securities, or any other voluntary action, avoid or seek to avoid
the observance or performance of any of the terms of this Agreement, and will at all times in good faith carry out all of the provision
of this Agreement and take all action as may be required to protect the rights of all holders of the Securities. Without limiting
the generality of the foregoing or any other provision of this Agreement or the other Transaction Documents, the Company (a) shall
not increase the par value of any shares of Common Stock receivable upon conversion of the Note or exercise of the Warrants above
the Note Conversion Price, or Warrant Exercise Price, as applicable, then in effect and (b) shall take all such action as may be
necessary or appropriate in order that the Company may validly and legally issue fully paid and nonassessable Shares upon the conversion
of the Note and Warrant Shares upon exercise of the Warrants. Notwithstanding anything herein to the contrary, if after 180 days
from the original issuance date, a holder is not permitted to convert the Note or exercise the Warrants, in full, for any reason,
the Company shall use its best efforts to promptly remedy such failure, including, without limitation, obtaining such consent or
approvals as necessary to permit such conversion or exercise.

 

(Signature Pages Follow)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

    	 	31	 

     

    

 

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.

 

	PROBILITY MEDIA CORP.	 	Address for Notice:
	 	 	 
	 	 	 
	By: /s/ Steven M. Plumb                         	 	1517 San Jacinto Street,
	Name: Steven M. Plumb	 	Houston, TX 77002
	Title: Chief Financial Officer	 	Email: steven@probilitymedia.com

 

 

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

Olshan Frome Wolosky, LLP

1325 Avenue of the Americas, 15th Floor

New York, New York 10019

Attn: Spencer G. Feldman, Esq.

E-mail: sfeldman@olshanlaw.com  

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK

SIGNATURE PAGE FOR PURCHASER FOLLOWS]

 

 

 

 

 

    	 	32	 

     

    

 

PURCHASER SIGNATURE PAGES TO PBYA
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 Execution Date.

 

Name of Purchaser: ________________________________________________________

 

Signature of Authorized Signatory of
Purchaser: _________________________________

 

Name of Authorized Signatory: _______________________________________________

 

Title of Authorized Signatory: ________________________________________________

 

Email Address of Authorized Signatory:
_________________________________________

 

Facsimile Number of Authorized Signatory: ______________________________________

 

Address for Notice to Purchaser:

 

 

 

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

 

 

Subscription Amount: $_________________

 

Warrant Shares: __________________

 

Additional Subscription Amount: $_________________

 

Additional Warrant Shares: __________________

 

 

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