Document:

Exhibit 4.1

 

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

 

	Original Issue Date: January 29, 2016	Principal Amount:  $[______]
	Note: 2016129-No – [__]	 

 

5%
SENIOR SECURED CONVERTIBLE PROMISSORY NOTE

DUE
FEBRUARY 29, 2016

 

THIS 5% SENIOR SECURED
CONVERTIBLE PROMISSORY NOTE is one of a series of duly authorized and validly issued 5% Senior Secured Convertible Promissory Notes
of xG Technology, Inc. (the “Company”), having its principal place of business at 240 S. Pineapple Avenue, Suite
701, Sarasota, FL, 34236, designated as its 5% Senior Secured Convertible Promissory Note due February 29, 2016 (the “Note”
and, collectively with the other Notes of such series, the “Notes”).

 

FOR VALUE RECEIVED,
the Company promises to pay to [____________] or its registered assigns (the “Holder”), or shall have paid pursuant
to the terms hereunder, the principal sum of $[_________] on the earlier of (i) February 29, 2016 or (ii) the closing of a Public
Offering (the “Maturity Date”) or such earlier date as this Note is required or permitted to be repaid as provided
hereunder, and to pay interest to the Holder on the aggregate unconverted and then outstanding principal amount of this Note in
accordance with the provisions hereof. This Note is subject to the following additional provisions:

 

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

 

    	 	1	 

     

    

 

“Alternate
Consideration” shall have the meaning set forth in Section 5(e).

 

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

 

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

 

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

 

“Change
of Control Transaction” means the occurrence after the date hereof of any of (a) an acquisition after the date hereof
by an individual or legal entity or “group” (as described in Rule 13d-5(b)(1) promulgated under the Exchange Act) of
effective control (whether through legal or beneficial ownership of capital stock of the Company, by contract or otherwise) of
in excess of 33% of the voting securities of the Company (other than by means of conversion or exercise of the Notes and the Securities
issued together with the Notes), (b) the Company merges into or consolidates with any other Person, or any Person merges into or
consolidates with the Company and, after giving effect to such transaction, the stockholders of the Company immediately prior to
such transaction own less than 66% of the aggregate voting power of the Company or the successor entity of such transaction, (c)
the Company sells or transfers all or substantially all of its assets to another Person and the stockholders of the Company immediately
prior to such transaction own less than 66% of the aggregate voting power of the acquiring entity immediately after the transaction,
(d) a replacement at one time or within a three year period of more than one-half of the members of the Board of Directors which
is not approved by a majority of those individuals who are members of the Board of Directors on the Original Issue Date (or by
those individuals who are serving as members of the Board of Directors on any date whose nomination to the Board of Directors was
approved by a majority of the members of the Board of Directors who are members on the date hereof), or (e) the execution by the
Company of an agreement to which the Company is a party or by which it is bound, providing for any of the events set forth in clauses
(a) through (d) above.

 

    	 	2	 

     

    

 

“Company”
shall have the meaning set forth in the preamble hereto.

 

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

 

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

 

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

 

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

 

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

 

“DTC”
means the Depository Trust Company.

 

“DTC/FAST
Program” means the DTC’s Fast Automated Securities Transfer Program.

 

“DWAC
Eligible” means that (a) the Common Stock is eligible at DTC for full services pursuant to DTC’s Operational Arrangements,
(b) the Company has been approved (without revocation) by the DTC’s underwriting department, (c) the Transfer Agent is approved
as an agent in the DTC/FAST Program, and (d) the Transfer Agent does not have a policy prohibiting or limiting delivery of the
Conversion Shares via Deposit/Withdrawal at Custodian.

 

“Equity
Conditions” means each of the following conditions: (a) the Company shall
have duly honored all conversions and redemptions scheduled to occur or occurring, including conversions pursuant to one or more
Notices of Conversion of the Holder, if any, (b) the Company shall have paid all liquidated damages and other amounts owing to
the Holder in respect of this Note, (c) on each day during the Equity Conditions Measuring Period, either (i) there is
an effective registration statement pursuant to which the Holder is permitted to utilize the prospectus thereunder to resell all
of the shares of Common Stock issuable pursuant to the Transaction Documents (and the Company believes, in good faith, that such
effectiveness will continue uninterrupted for the foreseeable future) or (ii) all of the Conversion Shares issuable pursuant to
the Transaction Documents (and shares issuable in lieu of cash payments of interest) may be resold pursuant to Rule 144 without
volume or manner-of-sale restrictions as determined by the counsel to the Company as set forth in a written opinion letter to
such effect, addressed and acceptable to the Transfer Agent and the Holder, (d) on each day during the Equity Conditions Measuring
Period, the Common Stock is trading on a Trading Market and all of the shares of Common Stock issuable pursuant to the Transaction
Documents are listed or quoted for trading on such Trading Market (and the Company believes, in good faith, that trading of the
Common Stock on a Trading Market will continue uninterrupted for the foreseeable future), (e) there is a sufficient number of
authorized but unissued and otherwise unreserved shares of Common Stock for the issuance of all of the shares of Common Stock
then issuable pursuant to the Transaction Documents, (f) on each day during the Equity Conditions Measuring Period, there is no
existing Event of Default and no existing event which, with the passage of time or the giving of notice, would constitute an Event
of Default, (g) the issuance of the shares of Common Stock in question to the Holder would not violate the limitations set forth
in Section 4(d) herein, (h) on each day during the Equity Conditions Measuring
Period, there has been no public announcement of a pending or proposed Fundamental
Transaction or Change of Control Transaction that has not been consummated, (i) the applicable Holder is not in possession of
any information provided by the Company that constitutes, or may constitute, material non-public information, (j) the Company
has timely filed (or obtained extensions in respect thereof and filed within the applicable grace period) all reports other than
Current Reports on Form 8-K required to be filed by the Company after the date hereof pursuant to the Exchange Act, (k) on any
date that the Company desires to make a payment of interest and/or principal, the average daily dollar volume of the Company’s
Common Stock for the previous twenty (20) Trading Days must be greater than $50,000, and (l) on each day during the Equity Conditions
Measuring Period, the Company’s shares of Common Stock must be DWAC Eligible and not subject to a “DTC chill”.

 

    	 	3	 

     

    

 

"Equity
Conditions Measuring Period" means each day during the period beginning twenty (20) Trading Days prior to the applicable
date of determination and ending on and including the applicable date of determination or, if applicable, such shorter period beginning
on the Original Issue Date and ending on and including the applicable date of determination.

 

“Event
of Default” shall have the meaning set forth in Section 6(a).

 

“Excess
Shares” shall have the meaning set forth in Section 4(d).

 

“Fundamental
Transaction” shall have the meaning set forth in Section 5(e).

 

“Holder”
shall have the meaning set forth in the preamble hereto.

 

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

 

“Maturity
Date” shall have the meaning set forth in the preamble hereto.

 

“New
York Courts” shall have the meaning set forth in Section 7(d).

 

“Note”
shall have the meaning set forth in the preamble hereto.

 

“Note
Register” shall have the meaning set forth in Section 2(b).

 

    	 	4	 

     

    

 

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

 

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

 

“Principal
Market” means the NASDAQ Capital Market.

 

“Public
Offering” means any underwritten public offering of at least $2,000,000 in gross proceeds of securities of the Company
pursuant to a registration statement on Form S-1 or Form S-3. 

 

“Purchase
Agreement” means the Securities Purchase Agreement, dated as of January 29, 2016 between the Company and the original
Holder, as amended, modified or supplemented from time to time in accordance with its terms.

 

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

 

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

 

“Significant
Subsidiary” means “significant subsidiary,” as such term is defined in Rule 1-02(w) of Regulation S-X.

 

“Successor
Entity” shall have the meaning set forth in Section 5(e).

 

Section
2.           Interest and Maturity.

 

a)         Payment
of Interest in Cash or Kind. The Company shall pay interest to the Holder on the aggregate unconverted and then outstanding
principal amount of this Note at the rate of 5% per annum. All interest payments hereunder will be payable in cash, or subject
to the Equity Conditions being satisfied, in Common Stock or a combination of cash and Common Stock in the Holder’s discretion.
Accrued and unpaid interest shall be due and payable on each Conversion Date and on the Maturity Date, or as otherwise set forth
herein.

 

b)         Interest
Calculations. Interest shall be calculated on the basis of a 360-day year, consisting of twelve 30 calendar day periods, and
shall accrue daily commencing on the Original Issue Date until payment in full of the outstanding principal, together with all
accrued and unpaid interest, liquidated damages and other amounts which may become due hereunder, has been made. Interest hereunder
will be paid to the Person in whose name this Note is registered on the records of the Company regarding registration and transfers
of this Note (the “Note Register”).

 

    	 	5	 

     

    

 

c)         Late
Fee. All overdue accrued and unpaid interest to be paid hereunder shall entail a late fee at an interest rate equal to the
lesser of 18% per annum or the maximum rate permitted by applicable law (the “Late Fees”) which shall accrue
daily from the date such interest is due hereunder through and including the date of actual payment in full.

 

d)         Maturity
due to Public Offering. Should this note mature due to the closing of a Public Offering, then Company shall make payment to
the Holder of an amount in cash equal to the sum of the then outstanding principal amount of the Note and interest multiplied by
135%; provided, that the Equity Conditions are met, which Equity Conditions may be waived by the Holder in its absolute discretion.

 

Section 3.           Registration
of Transfers and Exchanges.

 

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

 

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

 

c)         Reliance
on Note Register. Prior to due presentment for transfer to the Company of this Note, the Company and any agent of the Company
may treat the Person in whose name this Note is duly registered on the Note Register as the owner hereof for the purpose of receiving
payment as herein provided and for all other purposes, whether or not this Note is overdue, and neither the Company nor any such
agent shall be affected by notice to the contrary.

 

Section 4.           Conversion.

 

a)         Voluntary
Conversion. From the date hereof until this Note is no longer outstanding, this Note shall be convertible, in whole or in part,
into shares of Common Stock at the option of the Holder, at any time and from time to time (subject to the conversion limitations
set forth in Section 4(d) hereof). The Holder shall effect conversions by delivering to the Company a Notice of Conversion,
the form of which is attached hereto as Annex A (each, a “Notice of Conversion”), specifying therein
the principal amount of this Note to be converted and the date on which such conversion shall be effected (such date, the “Conversion
Date”). If no Conversion Date is specified in a Notice of Conversion, the Conversion Date shall be the date that such
Notice of Conversion is deemed delivered hereunder. No ink-original Notice of Conversion shall be required, nor shall any medallion
guarantee (or other type of guarantee or notarization) of any Notice of Conversion form be required. To effect conversions hereunder,
the Holder shall not be required to physically surrender this Note to the Company unless the entire principal amount of this Note,
plus all accrued and unpaid interest thereon, has been so converted. Conversions hereunder shall have the effect of lowering the
outstanding principal amount of this Note in an amount equal to the applicable conversion. The Holder and the Company shall maintain
a Conversion Schedule showing the principal amount(s) converted and the date of such conversion(s). The Company may deliver an
objection to any Notice of Conversion within one (1) Business Day of delivery of such Notice of Conversion. In the event of any
dispute or discrepancy, the records of the Holder shall be controlling and determinative in the absence of manifest error. The
Holder, and any assignee by acceptance of this Note, acknowledge and agree that, by reason of the provisions of this paragraph,
following conversion of a portion of this Note, the unpaid and unconverted principal amount of this Note may be less than the amount
stated on the face hereof.

 

    	 	6	 

     

    

 

b)         Conversion
Price. The conversion price in effect on any Conversion Date shall be equal to $1.00, subject to adjustment as provided herein
(the “Conversion Price”). All such foregoing determinations will be appropriately adjusted for any stock dividend,
stock split, stock combination, reclassification or similar transaction that proportionately decreases or increases the Common
Stock during such measuring period. Nothing herein shall limit a Holder’s right to pursue actual damages or declare an Event
of Default pursuant to Section 6 hereof and the Holder shall have the right to pursue all remedies available to it hereunder, at
law or in equity including, without limitation, a decree of specific performance and/or injunctive relief. The exercise of any
such rights shall not prohibit the Holder from seeking to enforce damages pursuant to any other Section hereof or under applicable
law.

 

c)         Mechanics
of Conversion.

 

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

 

ii.         Delivery
of Certificate Upon Conversion. Not later than three (3) Trading Days after each Conversion Date (the “Share Delivery
Date”), the Company shall deliver, or cause to be delivered, to the Holder (A) a certificate or certificates representing
the Conversion Shares which, on or after the date on which such Conversion Shares are eligible to be sold under Rule 144 without
the need for current public information and the Company has received an opinion of counsel to such effect reasonably acceptable
to the Company (which opinion the Company will be responsible for obtaining) shall be free of restrictive legends and trading restrictions
(other than those which may then be required by the Purchase Agreement) representing the number of Conversion Shares being acquired
upon the conversion of this Note, and (B) a bank check in the amount of accrued and unpaid interest to be paid in cash (if the
Company has elected or is required to pay any accrued interest in cash). All certificate or certificates required to be delivered
by the Company under this Section 4(c) shall be delivered electronically through DTC or another established clearing corporation
performing similar functions. If the Conversion Date is prior to the date on which such Conversion Shares are eligible to be sold
under Rule 144 without the need for current public information the Conversion Shares shall bear a restrictive legend in the following
form, as appropriate:

 

    	 	7	 

     

    

 

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

 

Notwithstanding the foregoing,
commencing on such date that the Conversion Shares are eligible for sale under Rule 144 subject to current public information requirements,
the Company, upon request of the Holder, shall obtain a legal opinion to allow for such sales under Rule 144.

 

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

 

    	 	8	 

     

    

 

iv.         Obligation
Absolute; Partial Liquidated Damages. The Company’s obligations to issue and deliver the Conversion Shares upon conversion
of this Note in accordance with the terms hereof are absolute and unconditional, irrespective of any action or inaction by the
Holder to enforce the same, any waiver or consent with respect to any provision hereof, the recovery of any judgment against any
Person or any action to enforce the same, or any setoff, counterclaim, recoupment, limitation or termination, or any breach or
alleged breach by the Holder or any other Person of any obligation to the Company or any violation or alleged violation of law
by the Holder or any other Person, and irrespective of any other circumstance which might otherwise limit such obligation of the
Company to the Holder in connection with the issuance of such Conversion Shares; provided, however, that such delivery
shall not operate as a waiver by the Company of any such action the Company may have against the Holder. In the event the Holder
of this Note shall elect to convert any or all of the outstanding principal or interest amount hereof, the Company may not refuse
conversion based on any claim that the Holder or anyone associated or affiliated with the Holder has been engaged in any violation
of law, agreement or for any other reason, unless an injunction from a court, on notice to Holder, restraining and or enjoining
conversion of all or part of this Note shall have been sought and obtained, and the Company posts a surety bond for the benefit
of the Holder in the amount of 150% of the outstanding principal amount of this Note, which is subject to the injunction, which
bond shall remain in effect until the completion of arbitration/litigation of the underlying dispute and the proceeds of which
shall be payable to the Holder to the extent it obtains judgment. In the absence of such injunction, the Company shall issue Conversion
Shares or, if applicable, cash, upon a properly noticed conversion. If the Company fails for any reason to deliver to the Holder
such certificate or certificates pursuant to Section 4(c)(ii) by the Share Delivery Date, the Company shall pay to the Holder,
in cash, as liquidated damages and not as a penalty, $1,000 per Trading Day for each Trading Day after such Share Delivery Date
until such certificates are delivered or Holder rescinds such conversion. Nothing herein shall limit a Holder’s right to
pursue actual damages or declare an Event of Default pursuant to Section 6 hereof for the Company’s failure to deliver Conversion
Shares within the period specified herein and the Holder shall have the right to pursue all remedies available to it hereunder,
at law or in equity including, without limitation, a decree of specific performance and/or injunctive relief. The exercise of any
such rights shall not prohibit the Holder from seeking to enforce damages pursuant to any other Section hereof or under applicable
law.

 

    	 	9	 

     

    

 

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

 

    	 	10	 

     

    

 

vi.         Reservation
of Shares Issuable Upon Conversion. The Company covenants that it will at all times reserve and keep available out of its authorized
and unissued shares of Common Stock a number of shares of Common Stock at least equal to 200% of the Required Minimum (as defined
in the Purchase Agreement) for the sole purpose of issuance upon
conversion of this Note and payment of interest on this Note, each as herein provided, free from preemptive rights or any other
actual contingent purchase rights of Persons other than the Holder (and the other holders of the Notes), not less than such aggregate
number of shares of the Common Stock as shall (subject to the terms and conditions set forth in the Purchase Agreement) be issuable
(taking into account the adjustments and restrictions of Section 5) upon the conversion of the then outstanding principal amount
of this Note and payment of interest hereunder. The Company covenants that all shares of Common Stock that shall be so issuable
shall, upon issue, be duly authorized, validly issued, fully paid and nonassessable.

 

    	 	11	 

     

    

 

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

 

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

 

    	 	12	 

     

    

 

		d)	Holder’s Conversion Limitations. The Company
shall not effect any conversion of principal and/or interest of this Note, and a Holder shall not have the right to convert any
principal and/or interest of this Note, to the extent that after giving effect to the conversion set forth on the applicable Notice
of Conversion, the Holder (together with the Holder’s Affiliates (as defined in the Purchase Agreement), and any Persons
acting as a group together with the Holder or any of the Holder’s Affiliates) would beneficially own in excess of the Beneficial
Ownership Limitation (as defined below).  For purposes of the foregoing sentence, the number of shares of Common Stock beneficially
owned by the Holder and its Affiliates shall include the number of shares of Common Stock issuable upon conversion of this Note
with respect to which such determination is being made, but shall exclude the number of shares of Common Stock which are issuable
upon (i) conversion of the remaining, unconverted principal amount of this Note beneficially owned by the Holder or any of its
Affiliates and (ii) exercise or conversion of the unexercised or unconverted portion of any other securities of the Company subject
to a limitation on conversion or exercise analogous to the limitation contained herein (including, without limitation, any other
Notes or warrants of the Company) beneficially owned by the Holder or any of its Affiliates.  Except as set forth in the
preceding sentence, for purposes of this Section 4(d), beneficial ownership shall be calculated in accordance with Section 13(d)
of the Exchange Act and the rules and regulations promulgated thereunder. In addition,
a determination as to any group status as contemplated above shall be determined in accordance with Section 13(d) of the Exchange
Act and the rules and regulations promulgated thereunder. For
purposes of this Section 4(d), in determining the number of outstanding shares of Common Stock, the Holder may rely on the number
of outstanding shares of Common Stock as stated in the most recent of the following: (i) the Company’s most recent periodic
or annual report filed with the Commission, as the case may be, (ii) a more recent public announcement by the Company, or (iii)
a more recent written notice by the Company or the Company’s transfer agent setting forth the number of shares of Common
Stock outstanding.  Upon the written or oral request of a Holder, the Company shall within two (2) Trading Days confirm orally
and in writing to the Holder the number of shares of Common Stock then outstanding.  In any case, the number of outstanding
shares of Common Stock shall be determined after giving effect to the conversion or exercise of securities of the Company, including
this Note, by the Holder or its Affiliates since the date as of which such number of outstanding shares of Common Stock was reported.
In the event that the issuance of shares of Common Stock to the Holder upon conversion of this Note results in the Holder and
its Affiliates being deemed to beneficially own, in the aggregate, more than the Beneficial Ownership Limitation (as determined
under Section 13(d) of the Exchange Act), the number of shares of Common Stock so issued by which the Holder's and its Affiliates’
aggregate beneficial ownership exceeds the Beneficial Ownership Limitation (the "Excess Shares") shall be deemed
null and void and shall be cancelled ab initio, and the Holder shall not have the power to vote or to transfer the Excess Shares.
The “Beneficial Ownership Limitation” shall be 4.99% of the number of shares of the Common Stock outstanding
immediately after giving effect to the issuance of shares of Common Stock issuable upon conversion of this Note held by the Holder.
The Holder, upon delivery of a written notice to the Company, may from time to time increase (with such increase not effective
until the 61st day after delivery of such notice) or decrease the Beneficial Ownership Limitation provision to any other percentage
not in excess of 9.99%; provided that (i) any such increase of the Beneficial Ownership Limitation will not be effective until
the 61st day after such notice is delivered to the Company and (ii) any such increase or decrease will apply only to the Holder
and its Affiliates and not to any other holder of Notes that is not an Affiliate of the Holder. The Beneficial Ownership Limitation
provisions of this paragraph shall be construed and implemented in a manner otherwise than in strict conformity with the terms
of this Section 4(d) to correct this paragraph (or any portion hereof) which may be defective or inconsistent with the intended
Beneficial Ownership Limitation contained herein or to make changes or supplements necessary or desirable to properly give effect
to such limitation. The limitations contained in this paragraph shall apply to a
successor holder of this Note.

 

    	 	13	 

     

    

 

		e)	Principal Market
Regulation. The Company shall not be obligated to issue any shares of Common Stock pursuant to the terms of this Note, and
the Holder shall not have the right to receive pursuant to the terms of this Note any shares of Common Stock, if the issuance
of such shares of Common Stock would exceed the aggregate number of shares of Common Stock which the Company may issue pursuant
to the terms of the Notes without breaching the Company’s obligations under the rules or regulations of the Principal Market
(the “Exchange Cap”), except that such limitation shall not apply in the event that the Company (i) obtains the approval
of its stockholders as required by the applicable rules of the Principal Market for issuances of Common Stock in excess of such
amount or (ii) obtains a written opinion from outside counsel to the Company that such approval is not required, which opinion
shall be reasonably satisfactory to the Required Holders. Until such approval or written opinion is obtained, no purchaser of
the Notes pursuant to the Securities Purchase Agreement (the “Purchasers”) shall be issued in the aggregate, pursuant
to the terms of the Notes, shares of Common Stock in an amount greater than the product of the Exchange Cap multiplied by a fraction,
the numerator of which is the Principal amount of Notes issued to such Purchaser pursuant to the Securities Purchase Agreement
on all Closing Dates and the denominator of which is the aggregate principal amount of all Notes issued to the Purchasers pursuant
to the Securities Purchase Agreement on all Closing Dates (with respect to each Purchaser, the “Exchange Cap Allocation”).
In the event that any Purchaser shall sell or otherwise transfer any of such Purchaser’s Notes, the transferee shall be
allocated a pro rata portion of such Purchaser’s Exchange Cap Allocation, and the restrictions of the prior sentence shall
apply to such transferee with respect to the portion of the Exchange Cap Allocation allocated to such transferee. In the event
that any holder of Notes shall convert all of such holder’s Notes into a number of shares of Common Stock which, in the
aggregate, is less than such holder’s Exchange Cap Allocation, then the difference between such holder’s Exchange
Cap Allocation and the number of shares of Common Stock actually issued to such holder shall be allocated to the respective Exchange
Cap Allocations of the remaining holders of Notes on a pro rata basis in proportion to the aggregate principal amount of the Notes
then held by each such holder. In the event that the Company is prohibited from issuing any Conversion Shares for which a Conversion
Notice has been received as a result of the operation of this Section 3(d)(ii), then unless the Holder elects to void such conversion,
the Holder may require the Company to pay to the Holder within three (3) Trading Days of the attempted conversion, cash in exchange
for cancellation of the Conversion Amount that is subject to such Conversion Notice, at a price per share of Common Stock that
would have been issuable upon such conversion if this Section 3(d)(ii) were not in effect equal to the highest trading price of
the Common Stock in effect at any time during the period beginning on the applicable Conversion Date and ending on the date the
Company makes the payment provided for in this sentence.

 

    	 	14	 

     

    

 

Section 5.           Certain
Adjustments.

 

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

 

    	 	15	 

     

    

 

		b)	Intentionally Omitted.

 

		c)	Subsequent Rights Offerings. In addition to any
adjustments pursuant to Section 5(a) above, if at any time the Company grants, issues or sells any Common Stock Equivalents or
rights to purchase stock, warrants, securities or other property pro rata to the record holders of any class of shares of Common
Stock (the “Purchase Rights”), then the Holder will be entitled to acquire, upon the terms applicable to such
Purchase Rights, the aggregate Purchase Rights which the Holder could have acquired if the Holder had held the number of shares
of Common Stock acquirable upon complete conversion of this Note (without regard to any limitations on exercise hereof, including
without limitation, the Beneficial Ownership Limitation) immediately before the date on which a record is taken for the grant,
issuance or sale of such Purchase Rights, or, if no such record is taken, the date as of which the record holders of shares of
Common Stock are to be determined for the grant, issue or sale of such Purchase Rights (provided, however, to the extent that
the Holder’s right to participate in any such Purchase Right would result in the Holder exceeding the Beneficial Ownership
Limitation, then the Holder shall not be entitled to participate in such Purchase Right to such extent (or beneficial ownership
of such shares of Common Stock as a result of such Purchase Right to such extent) and such Purchase Right to such extent shall
be held in abeyance for the Holder until such time, if ever, as its right thereto would not result in the Holder exceeding the
Beneficial Ownership Limitation).

 

		d)	Intentionally Omitted.

 

    	 	16	 

     

    

 

		e)	Fundamental Transaction. If, at any time while this
Note is outstanding, (i) the Company, directly or indirectly, in one or more related transactions effects any merger or consolidation
of the Company with or into another Person, (ii) the Company, directly or indirectly, effects any sale, lease, license, assignment,
transfer, conveyance or other disposition of all or substantially all of its assets in one or a series of related transactions,
(iii) any, direct or indirect, purchase offer, tender offer or exchange offer (whether by the Company or another Person) is completed
pursuant to which holders of Common Stock are permitted to sell, tender or exchange their shares for other securities, cash or
property and has been accepted by the holders of 50% or more of the outstanding Common Stock, (iv) the Company, directly or indirectly,
in one or more related transactions effects any reclassification, reorganization or recapitalization of the Common Stock or any
compulsory share exchange pursuant to which the Common Stock is effectively converted into or exchanged for other securities,
cash or property, (v) the Company, directly or indirectly, in one or more related transactions consummates a stock or share purchase
agreement or other business combination (including, without limitation, a reorganization, recapitalization, spin-off or scheme
of arrangement) with another Person whereby such other Person acquires more than 50% of the outstanding shares of Common Stock
(not including any shares of Common Stock held by the other Person or other Persons making or party to, or associated or affiliated
with the other Persons making or party to, such stock or share purchase agreement or other business combination) (each a “Fundamental
Transaction”), then, upon any subsequent conversion of this Note, the Holder shall have the right to receive, for each
Conversion Share that would have been issuable upon such conversion immediately prior to the occurrence of such Fundamental Transaction
(without regard to any limitation in Section 4(d) on the conversion of this Note), the number of shares of Common Stock of the
successor or acquiring corporation or of the Company, if it is the surviving corporation, and any additional consideration (the
“Alternate Consideration”) receivable as a result of such Fundamental Transaction by a holder of the number
of shares of Common Stock for which this Note is convertible immediately prior to such Fundamental Transaction (without regard
to any limitation in Section 4(d) on the conversion of this Note). For purposes of any such conversion, the determination of the
Conversion Price shall be appropriately adjusted to apply to such Alternate Consideration based on the amount of Alternate Consideration
issuable in respect of one (1) share of Common Stock in such Fundamental Transaction, and the Company shall apportion the Conversion
Price among the Alternate Consideration in a reasonable manner reflecting the relative value of any different components of the
Alternate Consideration. If holders of Common Stock are given any choice as to the securities, cash or property to be received
in a Fundamental Transaction, then the Holder shall be given the same choice as to the Alternate Consideration it receives upon
any conversion of this Note following such Fundamental Transaction. The Company shall cause any successor entity in a Fundamental
Transaction in which the Company is not the survivor (the “Successor Entity”) to assume in writing all of the
obligations of the Company under this Note and the other Transaction Documents (as defined in the Purchase Agreement) in accordance
with the provisions of this Section 5(e) pursuant to written agreements in form and substance reasonably satisfactory to the Holder
and approved by the Holder (without unreasonable delay) prior to such Fundamental Transaction and shall, at the option of the
holder of this Note, deliver to the Holder in exchange for this Note a security of the Successor Entity evidenced by a written
instrument substantially similar in form and substance to this Note which is convertible for a corresponding number of shares
of capital stock of such Successor Entity (or its parent entity) equivalent to the shares of Common Stock acquirable and receivable
upon conversion of this Note (without regard to any limitations on the conversion of this Note) prior to such Fundamental Transaction,
and with a conversion price which applies the conversion price hereunder to such shares of capital stock (but taking into account
the relative value of the shares of Common Stock pursuant to such Fundamental Transaction and the value of such shares of capital
stock, such number of shares of capital stock and such conversion price being for the purpose of protecting the economic value
of this Note immediately prior to the consummation of such Fundamental Transaction), and which is reasonably satisfactory in form
and substance to the Holder. Upon the occurrence of any such Fundamental Transaction, the Successor Entity shall succeed to, and
be substituted for (so that from and after the date of such Fundamental Transaction, the provisions of this Note and the other
Transaction Documents referring to the “Company” shall refer instead to the Successor Entity), and may exercise every
right and power of the Company and shall assume all of the obligations of the Company under this Note and the other Transaction
Documents with the same effect as if such Successor Entity had been named as the Company herein.

 

    	 	17	 

     

    

 

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

 

		g)	Notice to the Holder.

 

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

 

    	 	18	 

     

    

 

ii.         Notice
to Allow Conversion by Holder. If (A) the Company shall declare a dividend (or any other distribution in whatever form) on
the Common Stock, (B) the Company shall declare a special nonrecurring cash dividend on or a redemption of the Common Stock, (C)
the Company shall authorize the granting to all holders of the Common Stock of rights or warrants to subscribe for or purchase
any shares of capital stock of any class or of any rights, (D) the approval of any stockholders of the Company shall be required
in connection with any reclassification of the Common Stock, any consolidation or merger to which the Company is a party, any
sale or transfer of all or substantially all of the assets of the Company, or any compulsory share exchange whereby the Common
Stock is converted into other securities, cash or property or (E) the Company shall authorize the voluntary or involuntary dissolution,
liquidation or winding up of the affairs of the Company, then, in each case, the Company shall cause to be filed at each office
or agency maintained for the purpose of conversion of this Note, and shall cause to be delivered to the Holder at its last address
as it shall appear upon the Note Register, at least twenty (20) calendar days prior to the applicable record or effective date
hereinafter specified, a notice stating (x) the date on which a record is to be taken for the purpose of such dividend, distribution,
redemption, rights or warrants, or if a record is not to be taken, the date as of which the holders of the Common Stock of record
to be entitled to such dividend, distributions, redemption, rights or warrants are to be determined or (y) the date on which such
reclassification, consolidation, merger, sale, transfer or share exchange is expected to become effective or close, and the date
as of which it is expected that holders of the Common Stock of record shall be entitled to exchange their shares of the Common
Stock for securities, cash or other property deliverable upon such reclassification, consolidation, merger, sale, transfer or
share exchange, provided that the failure to deliver such notice or any defect therein or in the delivery thereof shall not affect
the validity of the corporate action required to be specified in such notice. To the extent that any notice provided hereunder
constitutes, or contains, material, non-public information regarding the Company or any of the Subsidiaries, the Company shall
simultaneously file such notice with the Commission pursuant to a Current Report on Form 8-K. The Holder shall remain entitled
to convert this Note during the 20-day period commencing on the date of such notice through the effective date of the event triggering
such notice except as may otherwise be expressly set forth herein.

 

    	 	19	 

     

    

 

Section
6.         Events of Default.

 

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

 

i.         any
default in the payment of (A) the principal amount of any Note or (B) interest, liquidated damages and other amounts owing to
a Holder on any Note, as and when the same shall become due and payable (whether on a Conversion Date or the Maturity Date or
by acceleration or otherwise) which default, solely in the case of an interest payment or other default under clause (B) above,
is not cured within three (3) Trading Days; provided that, in the case of any default in the payment of amounts due and payable
on the Maturity Date, if the Maturity Date is extended during the Extension Period, this Section 6(a)(i) shall only apply after
the termination of the Extension Period;

 

ii.         the
Company shall fail to observe or perform any other material covenant or material agreement contained in the Notes (other than a
breach by the Company of its obligations to deliver shares of Common Stock to the Holder upon conversion, which breach is addressed
in clause (xi) below) which failure is not cured, if possible to cure, within the earlier to occur of (A) five (5) Trading Days
after notice of such failure sent by the Holder or by any other Holder to the Company and (B) ten (10) Trading Days after the Company
has become or should have become aware of such failure;

 

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

 

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

 

v.         the
Company or any Significant Subsidiary shall be subject to a Bankruptcy Event;

 

    	 	20	 

     

    

 

vi.         the
Company or any Subsidiary shall default on any of its obligations under any mortgage, credit agreement or other facility, indenture
agreement, factoring agreement or other instrument under which there may be issued, or by which there may be secured or evidenced,
any indebtedness for borrowed money or money due under any long term leasing or factoring arrangement that (a) involves an obligation
greater than $100,000, whether such indebtedness now exists or shall hereafter be created, and (b) results in such indebtedness
becoming or being declared due and payable prior to the date on which it would otherwise become due and payable;

 

vii.         the
Common Stock shall not be eligible for listing or quotation for trading on a Trading Market and shall not be eligible to resume
listing or quotation for trading thereon within five (5) Trading Days or the transfer of shares of Common Stock through the Depository
Trust Company System is no longer available or “chilled”;

 

viii.         the
Company shall be a party to any Change of Control Transaction or Fundamental Transaction or shall agree to sell or dispose of all
or in excess of 33% of its assets in one transaction or a series of related transactions (whether or not such sale would constitute
a Change of Control Transaction);

 

ix.         the
Company shall fail for any reason to deliver certificates to a Holder on or prior to the third (3rd) Trading Day after a Conversion
Date pursuant to Section 4(c) or the Company shall provide at any time notice to the Holder, including by way of public announcement,
of the Company’s intention to not honor requests for conversions of any Notes in accordance with the terms hereof;

 

x.         the
Company fails to file with the Commission any required reports under Section 13 or 15(d) of the Exchange Act such that it is not
in compliance with Rule 144(c)(1) (or Rule 144(i)(2), if applicable);

 

    	 	21	 

     

    

 

xi.         if
the Company or any Significant Subsidiary shall: (i) apply for or consent to the appointment of a receiver, trustee, custodian
or liquidator of it or any of its properties, (ii) admit in writing its inability to pay its debts as they mature, (iii) make a
general assignment for the benefit of creditors, (iv) be adjudicated a bankrupt or insolvent or be the subject of an order for
relief under Title 11 of the United States Code or any bankruptcy, reorganization, insolvency, readjustment of debt, dissolution
or liquidation law or statute of any other jurisdiction or foreign country, (v) file a voluntary petition in bankruptcy, or a petition
or an answer seeking reorganization or an arrangement with creditors or to take advantage or any bankruptcy, reorganization, insolvency,
readjustment of debt, dissolution or liquidation law or statute, or an answer admitting the material allegations of a petition
filed against it in any proceeding under any such law, or (vi) take or permit to be taken any action in furtherance of or for the
purpose of effecting any of the foregoing;

 

xii.         if
any order, judgment or decree shall be entered, without the application, approval or consent of the Company or any Significant
Subsidiary, by any court of competent jurisdiction, approving a petition seeking liquidation or reorganization of the Company or
any Significant Subsidiary, or appointing a receiver, trustee, custodian or liquidator of the Company or any Significant Subsidiary,
or of all or any substantial part of its assets, and such order, judgment or decree shall continue unstayed and in effect for any
period of sixty (60) days;

 

xiii.         the
occurrence of any levy upon or seizure or attachment of, or any uninsured loss of or damage to, any property of the Company or
any Subsidiary having an aggregate fair value or repair cost (as the case may be) in excess of $100,000 individually or in the
aggregate, and any such levy, seizure or attachment shall not be set aside, bonded or discharged within thirty (30) days after
the date thereof;

 

xiv.         the
Company shall fail to maintain sufficient reserved shares of Common Stock pursuant to Section 4(c)(vi) of this Note or Section
4.10 of the Purchase Agreement; or

 

xv.         any
monetary judgment, writ or similar final process shall be entered or filed against the Company, any subsidiary or any of their
respective property or other assets for more than $100,000, and such judgment, writ or similar final process shall remain unvacated,
unbonded or unstayed for a period of forty-five (45) calendar days;

 

b)         Remedies
Upon Event of Default. If any Event of Default occurs, then the outstanding principal amount of this Note, plus accrued but
unpaid interest, liquidated damages and other amounts owing in respect thereof through the date of acceleration, shall become,
at the Holder’s election, immediately due and payable in cash. After the occurrence of any Event of Default that results
in the eventual acceleration of this Note, the interest rate on this Note shall accrue at an additional interest rate equal to
the lesser of 2% per month (24% per annum) or the maximum rate permitted under applicable law. Upon the payment in full of all
amounts due to the Holder following an Event of Default, the Holder shall promptly surrender this Note to or as directed by the
Company. In connection with such acceleration described herein, the Holder need not provide, and the Company hereby waives, any
presentment, demand, protest or other notice of any kind, and the Holder may immediately and without expiration of any grace period
enforce any and all of its rights and remedies hereunder and all other remedies available to it under applicable law. Such acceleration
may be rescinded and annulled by Holder at any time prior to payment hereunder and the Holder shall have all rights as a holder
of the Note until such time, if any, as the Holder receives full payment pursuant to this Section 6(b). No such rescission or annulment
shall affect any subsequent Event of Default or impair any right consequent thereon. Nothing in this Section 6(b) shall prevent
the Holder and the Company from mutually agreeing on other remedy in an Event of Default.

 

    	 	22	 

     

    

 

                  Section
7.         Miscellaneous.

 

a)         Notices.
Any and all notices or other communications or deliveries to be provided by the Holder hereunder, including, without limitation,
any Notice of Conversion, shall be in writing and delivered personally, by facsimile, or sent by a nationally recognized overnight
courier service, addressed to the Company, at the address set forth above, or such other facsimile number or address as the Company
may specify for such purposes by notice to the Holder delivered in accordance with this Section 7(a). Any and all notices or other
communications or deliveries to be provided by the Company hereunder shall be in writing and delivered personally, by facsimile,
or sent by a nationally recognized overnight courier service addressed to each Holder at the facsimile number or address of the
Holder appearing on the books of the Company, or if no such facsimile number or address appears on the books of the Company, at
the principal place of business of such Holder, as set forth in the Purchase Agreement. Any notice or other communication or deliveries
hereunder shall be deemed given and effective on the earliest of (i) the date of transmission, if such notice or communication
is delivered via facsimile at the facsimile number set forth on the signature pages attached hereto prior to 12:00 p.m. (New York
City time) on any date, (ii) the next Trading Day after the date of transmission, if such notice or communication is delivered
via facsimile at the facsimile number set forth on the signature pages attached hereto on a day that is not a Trading Day or later
than 12:00 p.m. (New York City time) on any Trading Day, (iii) the second (2nd) Trading Day following the date of mailing, if sent
by U.S. nationally recognized overnight courier service or (iv) upon actual receipt by the party to whom such notice is required
to be given.

 

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

 

c)         Lost
or Mutilated Note. If this Note shall be mutilated, lost, stolen or destroyed, the Company shall execute and deliver, in exchange
and substitution for and upon cancellation of a mutilated Note, or in lieu of or in substitution for a lost, stolen or destroyed
Note, a new Note for the principal amount of this Note so mutilated, lost, stolen or destroyed, but only upon receipt of evidence
of such loss, theft or destruction of such Note, and of the ownership hereof, reasonably satisfactory to the Company.

 

    	 	23	 

     

    

 

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

 

e)         Amendment;
Waiver. The written consent of the Holder and each other holder of a Note shall be required for any change or amendment or
waiver of any provision to the Notes.

 

f)         Failure
or Indulgence not Waiver. No failure or delay on the part of the Holder in the exercise of any power, right or privilege hereunder
shall operate as a waiver thereof, nor shall any single or partial exercise of any such power, right or privilege preclude other
or further exercise thereof or of any other right, power or privilege.

 

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

 

    	 	24	 

     

    

 

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

 

i)         Payment
of Collection, Enforcement and Other Costs. If (i) this Note is placed in the hands of an attorney for collection or enforcement
or is collected or enforced through any legal proceeding or the Holder otherwise takes action to collect amounts due under this
Note or to enforce the provisions of this Note or (ii) there occurs any bankruptcy, reorganization, receivership of the Company
or other proceedings affecting Company creditors' rights and involving a claim under this Note, then the Company shall pay the
reasonable and documented out-of-pocket costs incurred by the Holder for such collection, enforcement or action or in connection
with such bankruptcy, reorganization, receivership or other proceeding, including, but not limited to, attorneys' fees and disbursements.

 

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

 

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

 

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

 

(Signature Pages Follow)

 

    	 	25	 

     

    

 

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

 

	 	xG TECHNOLOGY, INC.
	 	 	 
	 	By:	 
	 	 	Name: Roger G. Branton
	 	 	Title: Chief Financial Officer
	 	 
	 	Facsimile No. for delivery of Notices: (941) 954-8595

 

     

     

    

 

ANNEX A

 

NOTICE OF CONVERSION

 

 

         The
undersigned hereby elects to convert principal under the 5% Senior Secured Convertible Promissory Note due February 29, 2016 of
xG Technology, Inc. (the “Company”),
into shares of common stock of the Company (the “Common Stock”) according to the conditions hereof, as of the
date written below. If shares of Common Stock are to be issued in the name of a person other than the undersigned, the undersigned
will pay all transfer taxes payable with respect thereto and is delivering herewith such certificates and opinions as reasonably
requested by the Company in accordance therewith. No fee will be charged to the holder for any conversion, except for such transfer
taxes, if any.

 

         After
giving effect to the conversion provided for in this Notice of Conversion, the undersigned (together with its Affiliates) will
beneficially own no more than ___________________ shares of Common Stock.

 

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

 

Conversion calculations:

Date to Effect Conversion:

 

Principal Amount of Note to be Converted:

 

Payment of Interest in Common
Stock __ yes __ no

If yes, $_____ of Interest Accrued
on Account of Conversion at Issue.

 

Number of shares of Common Stock
to be issued:

 

Signature:

 

Name:

 

Delivery Instructions:

 

     

     

    

 

Schedule 1

 

CONVERSION SCHEDULE

 

This 5% Senior Secured Convertible Promissory
Note due on February 29, 2016 in the original principal amount of $[________] is issued by xG Technology, Inc. This Conversion
Schedule reflects conversions made under Section 4 of the above referenced Note.

 

Dated:

 

	
        Date of Conversion

        (or for first entry,

        Original Issue Date)
	 	Amount of

Conversion	 	
        Aggregate

        Principal

        Amount

        Remaining

        Subsequent to

        Conversion

        (or original

        Principal

        Amount)
	 	
         

        Company AttestExhibit 10.1

 

ASSET PURCHASE
AGREEMENT

 

between

 

INTEGRATED
MICROWAVE TECHNOLOGIES, LLC

 

and

 

xG Technology,
Inc.

 

dated as of

 

January 29, 2016

 

     

    	 

    

 

TABLE OF
CONTENTS

 

	ASSET PURCHASE AGREEMENT	1
	 	 
	Article I Definitions	1
	 	 
	Article II Purchase and Sale	6
	 	 
	Section 2.01 Purchase and Sale of Assets.	6
	 	 
	Section 2.02 Excluded Assets.	7
	 	 
	Section 2.03 Assumed Liabilities.	8
	 	 
	Section 2.04 Excluded Liabilities.	8
	 	 
	Section 2.05 Purchase Price.	9
	 	 
	Section 2.06 Allocation of Purchase Price.	9
	 	 
	Section 2.07 Non-assignable Assets.	10
	 	 
	Article III Closing	10
	 	 
	Section 3.01 Closing.	10
	 	 
	Section 3.02 Closing Deliverables.	11
	 	 
	Article IV Representations and warranties of seller	11
	 	 
	Section 4.01 Organization and Authority of Seller.	11
	 	 
	Section 4.02 No Conflicts; Consents.	12
	 	 
	Section 4.03 Financial Statements.	12
	 	 
	Section 4.04 Absence of Undisclosed Liabilities.	12
	 	 
	Section 4.05 Absence of Certain Changes, Events and Conditions.	12
	 	 
	Section 4.06 Material Contracts.	13
	 	 
	Section 4.07 Title to Tangible Personal Property.	14
	 	 
	Section 4.08 Intellectual Property.	14
	 	 
	Section 4.09 Real Property	14
	 	 
	Section 4.10 Legal Proceedings; Governmental Orders.	14
	 	 
	Section 4.11 Compliance With Laws; Permits.	15
	 	 
	Section 4.12 Environmental Matters.	15

 

    	Asset Purchase Agreement	Page i

    	 

    

 

	Section 4.13 Employee Benefit Matters.	15
	 	 
	Section 4.14 Employment Matters.	16
	 	 
	Section 4.15 Taxes.	16
	 	 
	Section 4.16 Affiliate Transactions.	17
	 	 
	Section 4.17 Inventories.	17
	 	 
	Section 4.18 Receivables.	17
	 	 
	Section 4.19 Brokers.	17
	 	 
	Section 4.20 Disclosure.	17
	 	 
	Section 4.21 No Other Representations and Warranties.	18
	 	 
	Article V Representations and warranties of buyer	18
	 	 
	Section 5.01 Organization and Authority of Buyer.	18
	 	 
	Section 5.02 No Conflicts; Consents.	18
	 	 
	Section 5.03 Brokers.	19
	 	 
	Section 5.04 Solvency	19
	 	 
	Section 5.05 Legal Proceedings.	19
	 	 
	Section 5.06 Independent Investigation.	19
	 	 
	Article VI Covenants	19
	 	 
	Section 6.01 Conduct of Business Prior to the Closing.	19
	 	 
	Section 6.02 Access to Information.	20
	 	 
	Section 6.03 Supplement to Disclosure Schedules.	20
	 	 
	Section 6.04 Employees; Benefit Plans.	20
	 	 
	Section 6.05 Governmental Approvals and Other Third-party Consents	21
	 	 
	Section 6.06 Books and Records.	22
	 	 
	Section 6.07 Closing Conditions	23
	 	 
	Section 6.08 Public Announcements.	23
	 	 
	Section 6.09 Bulk Sales Laws.	23
	 	 
	Section 6.10 Transfer Taxes.	23
	 	 
	Section 6.11 Further Assurances.	23
		

 

    	Asset Purchase Agreement	Page ii

    	 

    

 

	Article VII Conditions to Closing	23
	 	 
	Section 7.01 Conditions to Obligations of All Parties.	23
	 	 
	Section 7.02 Conditions to Obligations of Buyer.	24
	 	 
	Section 7.03 Conditions to Obligations of Seller.	25
	 	 
	Article VIII Indemnification	26
	 	 
	Section 8.01 Survival.	26
	 	 
	Section 8.02 Indemnification By Seller.	26
	 	 
	Section 8.03 Indemnification By Buyer.	26
	 	 
	Section 8.04 Certain Limitations.	26
	 	 
	Section 8.05 Indemnification Procedures.	28
	 	 
	Section 8.06 Tax Treatment of Indemnification Payments.	29
	 	 
	Section 8.07 Exclusive Remedies.	29
	 	 
	Article IX Termination	30
	 	 
	Section 9.01 Termination	30
	 	 
	Section 9.02 Effect of Termination	30
	 	 
	Article X Miscellaneous	30
	 	 
	Section 10.01 Expenses.	30
	 	 
	Section 10.02 Notices.	31
	 	 
	Section 10.03 Interpretation.	31
	 	 
	Section 10.04 Headings.	32
	 	 
	Section 10.05 Severability.	32
	 	 
	Section 10.06 Entire Agreement.	32
	 	 
	Section 10.07 Successors and Assigns.	32
	 	 
	Section 10.08 No Third-party Beneficiaries.	32
	 	 
	Section 10.09 Amendment and Modification; Waiver.	32
	 	 
	Section 10.10 Governing Law; Submission to Jurisdiction; Waiver of Jury Trial.	33
	 	 
	Section 10.11 Specific Performance.	33
	 	 
	Section 10.12 Counterparts.	33
	 	 
	Section 10.13 Non-recourse.	34

 

    	Asset Purchase Agreement	Page iii

    	 

    

 

ASSET
PURCHASE AGREEMENT

 

This Asset Purchase Agreement (this "Agreement"),
dated as of January 29, 2016, is entered into between Integrated Microwave Technologies,
LLC, a Delaware limited liability company with
its principal place of business at 200 International Drive, Mt. Olive, New Jersey 07828 ("Seller")
and xG Technology, Inc., a Delaware corporation, with its
principal place of business at 240 South Pineapple Avenue, Suite 701, Sarasota, Florida, 34236 ("Buyer").

 

RECITALS

 

WHEREAS, Seller is engaged in the
business of designing, manufacturing and supplying of Coded Orthogonal Frequency Division Multiplexing (COFDM) microwave transmitters
and receivers serving the broadcast, sports and entertainment, military, aerospace and government markets (the “Business”);
and

 

WHEREAS, Seller wishes to sell and
assign to Buyer, and Buyer wishes to purchase and assume from Seller, substantially all the assets and liabilities of the Business,
subject to the terms and conditions set forth herein;

 

NOW, THEREFORE, in consideration
of the mutual covenants and agreements hereinafter set forth and for other good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, the parties hereto agree as follows:

 

Article
I

Definitions

 

The following terms have the meanings specified
or referred to in this Article I:

 

		(a)	"Affiliate" of
a Person means any other Person that directly or indirectly, through one or more intermediaries, controls, is controlled by, or
is under common control with, such Person. The term "control" (including the terms "controlled by" and "under
common control with") means the possession, directly or indirectly, of the power to direct or cause the direction of the management
and policies of a Person, whether through the ownership of voting securities, by contract or otherwise.

 

		(b)	"Agreement" has
the meaning set forth in the preamble.

 

		(c)	"Allocation Schedule" has
the meaning set forth in Section 2.06.

 

		(d)	"Assigned Contracts" has
the meaning set forth in Section 2.01(c).

 

		(e)	"Assignment and Assumption Agreement" has
the meaning set forth in Section 3.02(a)(ii).

 

		(f)	"Assignment and Assumption of
Lease" has the meaning set forth in Section 3.02(a)(iii).

 

		(g)	"Assumed Liabilities" has
the meaning set forth in Section 2.03.

 

		(h)	"Balance Sheet" has
the meaning set forth in Section 4.03.

 

		(i)	"Balance Sheet Date" has
the meaning set forth in Section 4.03.

 

		(j)	"Benefit Plan" has
the meaning set forth in Section 4.11(a).

 

     1

    	 

    

 

		(k)	"Bill of Sale" has
the meaning set forth in Section 3.02(a)(i).

 

		(l)	"Books and Records" has
the meaning set forth in Section 2.01(j).

 

		(m)	"Business" has
the meaning set forth in the recitals.

 

		(n)	"Business Day" means
any day except Saturday, Sunday or any other day on which commercial banks located in New York, New York, are authorized or required
by Law to be closed for business.

 

		(o)	"Buyer" has
the meaning set forth in the preamble.

 

		(p)	"Buyer Benefit Plans" has
the meaning set forth in Section 6.04(c).

 

		(q)	"Buyer Closing Certificate" has
the meaning set forth in Section 7.03(d).

 

		(r)	"Closing" has
the meaning set forth in Section 3.01.

 

		(s)	"Closing Date" has
the meaning set forth in Section 3.01.

 

		(t)	"Code" means
the Internal Revenue Code of 1986, as amended.

 

		(u)	"Contracts" means
all legally binding written contracts, leases, mortgages, licenses, instruments, notes, commitments, undertakings, indentures and
other agreements.

 

		(v)	"Data Room" means
the electronic documentation site established by Seller containing the documents set forth in the index included in Schedule
1.01(v) of the Disclosure Schedules.

 

		(w)	"Direct Claim" has
the meaning set forth in Section 8.05(c).

 

		(x)	"Disclosure Schedules" means
the Disclosure Schedules delivered by Seller and Buyer concurrently with the execution and delivery of this Agreement.

 

		(y)	"Dollars or $" means
the lawful currency of the United States.

 

		(z)	"Employees" means
those Persons employed by Seller who worked primarily for the Business immediately prior to the Closing.

 

		(aa)	"Encumbrance" means
any lien, pledge, mortgage, deed of trust, security interest, charge, claim, easement, encroachment or other similar encumbrance.

 

		(bb)	“Environmental Law” means any foreign, federal, state or local law, treaty,
statute, rule, regulation, order, ordinance, decree, injunction, judgment, governmental restrictions or any other requirement of
law (including common law) regulating or relating to the protection of human health, safety, natural resources or the environment,
including, without limitation, laws relating to contamination and the use, generation, management, handling, transport, treatment,
disposal, storage, release or threatened release of hazardous substances.

 

		(cc)	“Environmental Permit” means any permit, license, authorization or consent
required pursuant to applicable Environmental Laws.

 

     2

    	 

    

 

		(dd)	"ERISA" means
the Employee Retirement Income Security Act of 1974, as amended, and the regulations promulgated thereunder.

 

		(ee)	"Excluded Assets" has
the meaning set forth in Section 2.02.

 

		(ff)	"Excluded Liabilities" has
the meaning set forth in Section 2.04.

 

		(gg)	"Financial Statements" has
the meaning set forth in Section 4.03.

 

		(hh)	"FIRPTA Certificate" has
the meaning set forth in Section 7.02(g).

 

		(ii)	"GAAP" means
United States generally accepted accounting principles in effect from time to time.

 

		(jj)	"Governmental Authority" means
any federal, state, local or foreign government or political subdivision thereof, or any agency or instrumentality of such government
or political subdivision, or any self-regulated organization or other non-governmental regulatory authority or quasi-governmental
authority (to the extent that the rules, regulations or orders of such organization or authority have the force of Law), or any
arbitrator, court or tribunal of competent jurisdiction.

 

		(kk)	"Governmental Order" means
any order, writ, judgment, injunction, decree, stipulation, determination or award entered by or with any Governmental Authority.

 

		(ll)	"Indemnified Party" has
the meaning set forth in Section 8.04.

 

		(mm)	"Indemnifying Party" has
the meaning set forth in Section 8.04.

 

		(nn)	"Intellectual Property" means
any and all of the following in any jurisdiction throughout the world: (a) trademarks and service marks, including all applications
and registrations and the goodwill connected with the use of and symbolized by the foregoing; (b) copyrights, including all applications
and registrations, and works of authorship, whether or not copyrightable; (c) trade secrets and confidential know-how; (d) patents
and patent applications; (e) websites and internet domain name registrations; and (f) all other intellectual property and industrial
property rights and assets, and all rights, interests and protections that are associated with, similar to, or required for the
exercise of, any of the foregoing.

 

		(oo)	"Intellectual Property Agreements" means
all licenses, sublicenses and other agreements by or through which other Persons grant Seller or Seller grants any other Persons
any exclusive or non-exclusive rights or interests in or to any Intellectual Property that is used exclusively in connection with
the Business.

 

		(pp)	"Intellectual Property Assets" means
all Intellectual Property that is owned by Seller and exclusively used in connection with the Business, including the Intellectual
Property Registrations set forth on Schedule 4.08 of the Disclosure Schedules.

 

		(qq)	"Intellectual Property Registrations" means
all Intellectual Property Assets that are subject to any issuance, registration, application or other filing by, to or with any
Governmental Authority or authorized private registrar in any jurisdiction, including registered trademarks, domain names, and
copyrights, issued and reissued patents and pending applications for any of the foregoing.

 

     3

    	 

    

 

		(rr)	"Inventory" has
the meaning set forth in Section 2.01(b).

 

		(ss)	"Knowledge
                                         of Seller” or “Seller's Knowledge" or any other
                                         similar knowledge qualification, means the actual knowledge of those persons listed on
                                         Schedule 1.01(ss) of the Disclosure Schedules.

 

		(tt)	"Law" means
any statute, law, ordinance, regulation, rule, code, order, constitution, treaty, common law, judgment, decree, other requirement
or rule of law of any Governmental Authority.

 

		(uu)	"Leased Real Property" has
the meaning set forth in Section 4.08(a).

 

		(vv)	"Leases" has
the meaning set forth in Section 4.08(a).

 

		(ww)	“Lien” means any mortgage, pledge, hypothecation, right of others, claim, security
interest, encumbrance, lease, sublease, license, occupancy agreement, adverse claim or interest, easement, covenant, encroachment,
burden, title defect, title retention agreement, voting trust agreement, interest, equity, option, lien, liability, obligation,
right of first refusal, charge or other restrictions or limitations of any nature whatsoever, including but not limited to such
as may arise under any Contracts.

 

		(xx)	“Litigation” means any action, cause of action, claim, cease and desist letter,
demand, suit, proceeding, citation, summons, subpoena or investigation of any nature, civil, criminal, regulatory or otherwise,
in law or in equity.

 

		(yy)	"Losses" means
actual out-of-pocket losses, damages, liabilities, costs or expenses, including reasonable attorneys' fees, and excluding punitive,
incidental, consequential, special or indirect damages (including loss of revenue, diminution in value and any damages based on
any type of multiple).

 

		(zz)	"Material Adverse Effect" means
any event, occurrence, fact, condition or change that is materially adverse to (a) the business, results of operations, financial
condition or assets of the Business, taken as a whole, or (b) the ability of Seller to consummate the transactions contemplated
hereby; provided, however, that "Material Adverse Effect" shall not include any event, occurrence, fact, condition
or change, directly or indirectly, arising out of or attributable to: (i) general economic or political conditions; (ii) conditions
generally affecting the industries in which the Business operates; (iii) any changes in financial, banking or securities markets
in general, including any disruption thereof and any decline in the price of any security or any market index or any change in
prevailing interest rates; (iv) acts of war (whether or not declared), armed hostilities or terrorism, or the escalation or worsening
thereof; (v) any action required or permitted by this Agreement or any action taken (or omitted to be taken) with the written consent
of or at the written request of Buyer; (vi) any matter of which Buyer is aware on the date hereof; (vii) any changes in applicable
Laws or accounting rules (including GAAP) or the enforcement, implementation or interpretation thereof; (viii) the announcement,
pendency or completion of the transactions contemplated by this Agreement, including losses or threatened losses of employees,
customers, suppliers, distributors or others having relationships with the Seller and the Business; (ix) any natural or man-made
disaster or acts of God; or (x) any failure by the Business to meet any internal or published projections, forecasts or revenue
or earnings predictions (provided that the underlying causes of such failures (subject to the other provisions of this definition)
shall not be excluded).

 

     4

    	 

    

 

		(aaa)	"Material Contracts" has
the meaning set forth in Section 4.05(a).

 

		(bbb)	"Permits" means
all permits, licenses, franchises, approvals, authorizations, and consents required to be obtained from Governmental Authorities.

 

		(ccc)	"Permitted Encumbrances" means
(a) liens for Taxes not yet due and payable or being contested in good faith by appropriate procedures; (b) mechanics', carriers',
workmen's, repairmen's or other like liens arising or incurred in the ordinary course of business; (c) easements, rights of way,
zoning ordinances and other similar encumbrances affecting Real Property; (d) other than with respect to Owned Real Property, liens
arising under original purchase price conditional sales contracts and equipment leases with third parties entered into in the ordinary
course of business; and (e) other imperfections of title or Encumbrances, if any, that have not had, and would not have, a Material
Adverse Effect.

 

		(ddd)	“Permitted Liens” means (i) Liens for Taxes not yet due and payable, or (ii)
mechanics, carriers, workers, materialmen’s, warehousemen’s or other similar statutory liens, incurred in the ordinary
course of business, consistent with past practices and for which sums are not due and payable.

 

		(eee)	"Person" means
an individual, corporation, partnership, joint venture, limited liability company, Governmental Authority, unincorporated organization,
trust, association or other entity.

 

		(fff)	"Purchase Price" has
the meaning set forth in Section 2.05.

 

		(ggg)	"Purchased Assets" has
the meaning set forth in Section 2.01.

 

		(hhh)	"Real Property" means
the real property owned, leased or subleased by the Seller, together with all buildings, structures and facilities located thereon.

 

		(iii)	"Release" means
any actual or threatened release, spilling, leaking, pumping, pouring, emitting, emptying, discharging, injecting, escaping, leaching,
dumping, abandonment, disposing or allowing to escape or migrate into or through the environment (including, without limitation,
ambient air (indoor or outdoor), surface water, groundwater, land surface or subsurface strata or within any building, structure,
facility or fixture).

 

		(jjj)	"Representative" means,
with respect to any Person, any and all directors, officers, employees, consultants, financial advisors, counsel, accountants and
other agents of such Person.

 

     5

    	 

    

 

		(kkk)	"Seller" has
the meaning set forth in the preamble.

 

		(lll)	"Seller Closing Certificate" has
the meaning set forth in Section 7.02(d).

 

		(mmm)	"Tangible Personal Property" has
the meaning set forth in Section 2.01(e).

 

		(nnn)	"Taxes" means
all federal, state, local, foreign and other income, gross receipts, sales, use, production, ad valorem, transfer, franchise, registration,
profits, license, lease, service, service use, withholding, payroll, employment, unemployment, estimated, excise, severance, environmental,
stamp, occupation, premium, property (real or personal), real property gains, windfall profits, customs, duties or other taxes,
fees, assessments or charges of any kind whatsoever, together with any interest, additions or penalties with respect thereto and
any interest in respect of such additions or penalties.

 

		(ooo)	"Tax Return" means
any return, declaration, report, claim for refund, information return or statement or other document required to be filed with
respect to Taxes, including any schedule or attachment thereto, and including any amendment thereof.

 

		(ppp)	"Third-Party Claim" has
the meaning set forth in Section 8.05(a).

 

		(qqq)	"Transaction Documents" means
this Agreement, the Bill of Sale, the Assignment and Assumption Agreement, Assignment and Assumption of Leases, and the other agreements,
instruments and documents required to be delivered at the Closing.

 

		(rrr)	"Transferred Employee" has
the meaning set forth in Section 6.04(a).

 

Article
II

Purchase and Sale

 

Section 2.01         Purchase
and Sale of Assets. Subject to the terms and conditions set forth herein, at the Closing, Seller shall sell, assign, transfer,
convey and deliver to Buyer, and Buyer shall purchase from Seller, free and clear of all Encumbrances other than Permitted Encumbrances,
all of Seller's right, title and interest in, to and under the following assets, properties and rights of Seller, to the extent
that such assets, properties and rights exist as of the Closing Date and primarily relate to the Business (collectively, the "Purchased
Assets"):

 

(a)         all cash and
cash equivalents, including Company bank accounts related to the Business, as of the Closing Date;

 

(b)         all accounts
or notes receivable of the Business;

 

(c)         all inventory,
finished goods, raw materials, work in progress, packaging, supplies, parts and other inventories of the Business ("Inventory");

 

(d)         all Contracts
set forth on Schedule 2.01(d) of the Disclosure Schedules, the Leases set forth on Schedule 4.09(a) of the Disclosure
Schedules and the Intellectual Property Agreements set forth on Schedule 4.09(a) of the Disclosure Schedules (collectively,
the "Assigned Contracts");

 

(e)         all Intellectual
Property Assets;

 

     6

    	 

    

 

(f)          all furniture,
fixtures, equipment, supplies and other tangible personal property of the Business listed on Schedule 2.01(f) of the Disclosure
Schedules (the "Tangible Personal Property");

 

(g)         all Leased Real
Property;

 

(h)         all Permits,
including Environmental Permits, listed on Schedule 2.01(h) of the Disclosure Schedules, but only to the extent such Permits
may be transferred under applicable Law;

 

(i)         all prepaid
expenses, credits, advance payments, security, deposits, charges, sums and fees set forth on Schedule 2.01(i) of the Disclosure
Schedules;

 

(j)          all of Seller's
rights under warranties, indemnities and all similar rights against third parties to the extent related to any Purchased Assets;

 

(k)         originals, or
where not available, copies, of all books and records, including books of account, ledgers and general, financial and accounting
records, machinery and equipment maintenance files, customer lists, customer purchasing histories, price lists, distribution lists,
supplier lists, production data, quality control records and procedures, customer complaints and inquiry files, research and development
files, records and data (including all correspondence with any Governmental Authority), sales material and records, strategic plans,
internal financial statements and marketing and promotional surveys, material and research, that exclusively relate to the Business
or the Purchased Assets, other than books and records set forth in Section 2.02(d) ("Books
and Records");

 

(l)          all goodwill
associated with any of the assets described in the foregoing clauses; and

 

(m)        any and all
other assets primarily associated with the Business not covered in Section 2.01(a)—(l).

 

Section 2.02         Excluded
Assets. Other than the Purchased Assets subject to Section 2.01, Buyer expressly understands and agrees that it is not
purchasing or acquiring, and Seller is not selling or assigning, any other assets or properties of Seller, and all such other assets
and properties shall be excluded from the Purchased Assets (the "Excluded
Assets"). Excluded Assets include the following assets and properties of Seller:

 

(a)         all Contracts
that are not Assigned Contracts;

 

(b)         all Intellectual
Property other than the Intellectual Property Assets;

 

(c)         the corporate
seals, organizational documents, minute books, stock books, Tax Returns, books of account or other records having to do with the
corporate organization of Seller, all employee-related or employee benefit-related files or records, other than personnel files
of Transferred Employees, and any other books and records which Seller is prohibited from disclosing or transferring to Buyer under
applicable Law and is required by applicable Law to retain;

 

(d)         all insurance
policies of Seller and all rights to applicable claims and proceeds thereunder;

 

(e)         all Benefit
Plans and trusts or other assets attributable thereto;

 

(f)         all Tax assets
(including duty and Tax refunds and prepayments) of Seller or any of its Affiliates;

 

     7

    	 

    

 

(g)         all rights to
any action, suit or claim of any nature available to or being pursued by Seller, whether arising by way of counterclaim or otherwise;

 

(h)         all assets,
properties and rights used by Seller in its businesses other than the Business;

 

(i)         the assets,
properties and rights specifically set forth on Schedule 2.02(i) of the Disclosure Schedules; and

  

(j)         the rights which
accrue or will accrue to Seller under the Transaction Documents;

 

provided, however, that
no Excluded Asset primarily relates to the Business.

 

Section 2.03         Assumed
Liabilities. Subject to the terms and conditions set forth herein, Buyer shall assume and agree to pay, perform and discharge
when due any and all liabilities and obligations of Seller arising out of or relating to the Business or the Purchased Assets on
or after the Closing, other than the Excluded Liabilities (collectively, the "Assumed
Liabilities"), including, without limitation, the following:

 

(a)         all trade accounts
payable of Seller to third parties in connection with the Business that remain unpaid as of the Closing Date;

 

(b)         all liabilities
and obligations arising under or relating to the Assigned Contracts;

 

(c)         all liabilities
and obligations of Buyer or its Affiliates relating to employee benefits, compensation or other arrangements with respect to any
Transferred Employee arising on or after the Closing;

 

(d)         all liabilities
and obligations for (i) Taxes relating to the Business, the Purchased Assets or the Assumed Liabilities for any taxable period
ending after the Closing Date and (ii) Taxes for which Buyer is liable pursuant to Section 6.11;

 

(e)         all other liabilities
and obligations arising out of or relating to Buyer's ownership or operation of the Business and the Purchased Assets on or after
the Closing; and

 

(f)         all liabilities
and obligations of Seller set forth on Schedule 2.03(f) of the Disclosure Schedules.

 

Section 2.04         Excluded
Liabilities. Buyer shall not assume and shall not be responsible to pay, perform or discharge any of the following liabilities
or obligations of Seller (collectively, the "Excluded
Liabilities"):

 

(a)         any liabilities
or obligations relating to or arising out of the Excluded Assets;

 

(b)         any liabilities
or obligations for (i) Taxes relating to the Business, the Purchased Assets or the Assumed Liabilities for any taxable period ending
on or prior to the Closing Date and (ii) any other Taxes of Seller or Affiliates of Seller (other than Taxes allocated to Buyer
under Section 6.11) for any taxable period;

 

(c)         any liabilities
or obligations of Seller relating to or arising out of (i) the employment, or termination of employment, of any Employee prior
to the Closing, or (ii) workers' compensation claims of any Employee which relate to events occurring prior to the Closing Date;
and

 

     8

    	 

    

 

(d)         any liabilities
or obligations of Seller arising or incurred in connection with the negotiation, preparation, investigation and performance of
this Agreement, the other Transaction Documents and the transactions contemplated hereby and thereby, including, without limitation,
fees and expenses of counsel, accountants, consultants, advisers and others; and

 

(e)         any liabilities
and obligations of Seller set forth on Schedule 2.04(e) of the Disclosure Schedules.

 

Section 2.05         Purchase
Price. The aggregate purchase price for the Purchased Assets shall be Three Million U.S. Dollars ($3,000,000) (the "Purchase
Price"), plus the assumption of the Assumed Liabilities. The purchase price due at Closing shall be paid by:

 

		(a)	delivery by Buyer to Seller of a promissory note in the principal sum of One Million Five Hundred
Thousand US Dollars ($1,500,000), bearing interest at 6% per annum, compounded monthly (the “Initial Payment Note”),
which said Initial Payment Note shall be redeemed upon the wire transfer of One Million Five Hundred Thousand US Dollars ($1,500,000),
plus accrued interest, of immediately available funds to an account designated in writing by Seller to Buyer on March 31, 2016
or sixty days following the Closing Date, whichever shall be later in time; and

 

		(b)	delivery by Buyer to Seller of a promissory note in the principal sum of One Million Five Hundred
Thousand US Dollars ($1,500,000), bearing interest at 6% per annum, compounded monthly (the “Deferred Payment Note”),
which said Deferred Payment Note shall be redeemed upon the wire transfer of One Million Five Hundred Thousand US Dollars ($1,500,000),
plus accrued interest, of immediately available funds to an account designated in writing by Seller to Buyer on the date falling
18 months immediately following the Closing Date.

 

Section 2.06         Allocation
of Purchase Price. Within 90 days after the Closing Date, Seller shall deliver a schedule allocating the Purchase Price (including
any Assumed Liabilities treated as consideration for the Purchased Assets for Tax purposes) (the "Allocation
Schedule"). The Allocation Schedule shall be prepared in accordance with Section 1060 of the Code. The Allocation
Schedule shall be deemed final unless Buyer notifies Seller in writing that Buyer objects to one or more items reflected in the
Allocation Schedule within 45 days after delivery of the Allocation Schedule to Buyer. In the event of any such objection, Seller
and Buyer shall negotiate in good faith to resolve such dispute; provided, however, that if Seller and Buyer are unable
to resolve any dispute with respect to the Allocation Schedule within 45 days after the delivery of the Allocation Schedule to
Buyer, such dispute shall be resolved by an impartial nationally recognized firm of independent certified public accountants mutually
appointed by Buyer and Seller. The fees and expenses of such accounting firm shall be borne equally by Seller and Buyer. Seller
and Buyer agree to file their respective IRS Forms 8594 and all federal, state and local Tax Returns in accordance with the Allocation
Schedule.

 

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Section 2.07         Non-assignable
Assets.

 

(a)         Notwithstanding
anything to the contrary in this Agreement, and subject to the provisions of this Section 2.07, to the extent that the sale,
assignment, transfer, conveyance or delivery, or attempted sale, assignment, transfer, conveyance or delivery, to Buyer of any
Purchased Asset would result in a violation of applicable Law, this Agreement shall not constitute a sale, assignment, transfer,
conveyance or delivery, or an attempted sale, assignment, transfer, conveyance or delivery, thereof; provided, however,
that the Closing shall occur notwithstanding the foregoing without any adjustment to the Purchase Price on account thereof. Following
the Closing, Seller and Buyer shall use commercially reasonable efforts, and shall cooperate with each other, to obtain any such
required consent, authorization, approval or waiver, or any release, substitution or amendment required to novate all liabilities
and obligations under any and all Assigned Contracts or other liabilities that constitute Assumed Liabilities or to obtain in writing
the unconditional release of all parties to such arrangements, so that, in any case, Buyer shall be solely responsible for such
liabilities and obligations from and after the Closing Date; provided, however, that neither Seller nor Buyer shall be required
to pay any consideration therefor. Once such consent, authorization, approval, waiver, release, substitution or amendment is obtained,
Seller shall sell, assign, transfer, convey and deliver to Buyer the relevant Purchased Asset to which such consent, authorization,
approval, waiver, release, substitution or amendment relates for no additional consideration. Applicable sales, transfer and other
similar Taxes in connection with such sale, assignment, transfer, conveyance or license shall be paid by Buyer in accordance with
Section 6.11.

 

Section 2.08         To
the extent that any Purchased Asset and/or Assumed Liability cannot be transferred to Buyer following the Closing pursuant to this
Section 2.08, Buyer and Seller shall use commercially reasonable efforts to enter into such arrangements (such as subleasing,
sublicensing or subcontracting) to provide to the parties the economic and, to the extent permitted under applicable Law, operational
equivalent of the transfer of such Purchased Asset and/or Assumed Liability to Buyer as of the Closing and the performance by Buyer
of its obligations with respect thereto. Buyer shall, as agent or subcontractor for Seller pay, perform and discharge fully the
liabilities and obligations of Seller thereunder from and after the Closing Date. To the extent permitted under applicable Law,
Seller shall, at Buyer's expense, hold in trust for and pay to Buyer promptly upon receipt thereof, such Purchased Asset and all
income, proceeds and other monies received by Seller to the extent related to such Purchased Asset in connection with the arrangements
under this Section 2.08. Seller shall be permitted to set off against such amounts all direct costs associated with the
retention and maintenance of such Purchased Assets. Notwithstanding anything herein to the contrary, the provisions of this Section
2.08 shall not apply to any consent or approval required under any antitrust, competition or trade regulation Law, which consent
or approval shall be governed by Section 6.06.

 

Article
III

Closing

 

Section 3.01         Closing.
Subject to the terms and conditions of this Agreement, the consummation of the transactions contemplated by this Agreement
(the "Closing") shall take place
at a closing (the "Closing") to
be held at 11:00 a.m., Pacific time, on January 29, 2016, at the offices of Skyview Capital, LLC, Suite 810-N, 2000 Avenue of the
Stars, Los Angeles, California, or at such other time or on such other date or at such other place as Seller and Buyer may mutually
agree upon in writing (the day on which the Closing takes place being the "Closing
Date").

 

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Section 3.02         Closing
Deliverables.

 

(a)         At the Closing,
Seller shall deliver to Buyer the following:

 

(i)         a bill of sale in
the form of Exhibit A hereto (the "Bill of Sale")
and duly executed by Seller, transferring the tangible personal property included in the Purchased Assets to Buyer;

 

(ii)         an assignment and
assumption agreement in the form of Exhibit B hereto (the "Assignment
and Assumption Agreement") and duly executed by Seller, effecting the assignment to and assumption by Buyer of
the Purchased Assets and the Assumed Liabilities;

 

(iii)         with respect to
each Lease, an Assignment and Assumption of Lease substantially in the form of Exhibit D (each, an "Assignment
and Assumption of Lease"), duly executed by Seller;

 

(iv)         the Seller Closing
Certificate;

 

(v)         the FIRPTA Certificate;

 

(vi)         the certificates
of the Secretary of Seller required by Section 7.02(e) and Section 7.02(f); and

 

(vii)         such other customary
instruments of transfer, assumption, filings or documents, in form and substance reasonably satisfactory to Buyer, as may be required
to give effect to this Agreement.

 

(b)         At the Closing,
Buyer shall deliver to Seller the following:

 

		(i)	the Assignment and Assumption Agreement duly executed by
Buyer;

 

		(ii)	with respect to each Lease, an Assignment and Assumption
of Lease duly executed by Buyer;

 

		(iii)	the Buyer Closing Certificate;

 

		(iv)	the certificates of the Secretary of Buyer required by
Section 7.03(e) and Section 7.03(f);

 

		(v)	the Initial Payment Note; and

 

		(vi)	the Deferred Payment Note.

 

Article
IV

Representations and warranties of seller

 

Except as set forth in the Disclosure Schedules,
Seller represents and warrants to Buyer that the statements contained in this Article IV are true and correct as of the
date hereof.

 

Section 4.01         Organization
and Authority of Seller. Seller is a limited liability company, duly formed, organized, validly existing and in good standing
under the Laws of the state of Delaware. Seller has all necessary power and authority to enter into this Agreement, to carry out
its obligations hereunder and to consummate the transactions contemplated hereby. The execution and delivery by Seller of this
Agreement, the performance by Seller of its obligations hereunder and the consummation by Seller of the transactions contemplated
hereby have been duly authorized by all requisite action on the part of Seller. This Agreement has been duly executed and delivered
by Seller, and (assuming due authorization, execution and delivery by Buyer) this Agreement constitutes a legal, valid and binding
obligation of Seller, enforceable against Seller in accordance with its terms, except as such enforceability may be limited by
bankruptcy, insolvency, reorganization, moratorium or similar Laws affecting creditors' rights generally and by general principles
of equity (regardless of whether enforcement is sought in a proceeding at law or in equity).

 

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Section 4.02         No
Conflicts; Consents. The execution, delivery and performance by Seller of this Agreement, and the consummation of the transactions
contemplated hereby, do not and will not: (a) result in a violation or breach of any provision of the formation or operating agreement
of Seller; (b) result in a violation or breach of any provision of any Law or Governmental Order applicable to Seller; or (c) except
as set forth in Schedule 4.02 of the Disclosure Schedules, require the consent, notice or other action by any Person under,
conflict with, result in a violation or breach of, constitute a default under or result in the acceleration of any Material Contract,
except in the cases of clauses (b) and (c), where the violation, breach, conflict, default, acceleration or failure to give notice
would not have a Material Adverse Effect. No consent, approval, Permit, Governmental Order, declaration or filing with, or notice
to, any Governmental Authority is required by or with respect to Seller in connection with the execution and delivery of this Agreement
and the consummation of the transactions contemplated hereby, and such consents, approvals, Permits, Governmental Orders, declarations,
filings or notices which, in the aggregate, would not have a Material Adverse Effect.

 

Section 4.03         Financial
Statements. Copies of the unaudited financial statements consisting of the balance sheet of the Business as at December 31,
2015 in each of the years 2015 and 2014 and the related statements of income and retained earnings for the years then ended (the
"Financial Statements") have been
delivered or made available to Buyer in the Data Room. The Financial Statements have been prepared in accordance with GAAP applied
on a consistent basis throughout the period involved, subject, in the case of the Interim Financial Statements, to normal and recurring
year-end adjustments and the absence of notes. The Financial Statements fairly present in all material respects the financial condition
of the Business as of the respective dates they were prepared and the results of the operations of the Business for the periods
indicated. The balance sheet of the Business as of December 31, 2015 is referred to herein as the "Balance
Sheet" and the date thereof as the "Balance
Sheet Date".

 

Section 4.04         Absence
of Undisclosed Liabilities. Except as set forth in Schedule 4.04 of the Disclosure Schedules, Seller has not entered
into any loan or credit agreement or arrangement with a bank, financial institution or other lender, and Seller does not have any
liabilities, whether known, unknown, absolute, accrued, contingent or otherwise, and whether due or to become due, arising out
of or relating to the Business, except (a) as set forth in Schedule 4.04 of the Disclosure Schedules, (b) as
and to the extent disclosed or reserved against in the Financial Statements or specifically disclosed in the notes thereto; and
(c) for liabilities that were incurred after December 31, 2015 in the ordinary course of business consistent with prior
practice.

 

Section 4.05         Absence
of Certain Changes, Events and Conditions. Except as expressly contemplated by the Agreement or as set forth on Schedule
4.05 of the Disclosure Schedules, from the Balance Sheet Date until the date of this Agreement, the Business has operated in
the ordinary course of business in all material respects and there has not been , with respect to the Business, any:

 

		(a)	event, occurrence or development that has had a Material Adverse Effect;

 

		(b)	incurrence, assumption or guarantee of any indebtedness for borrowed money, except unsecured current
obligations and liabilities incurred in the ordinary course of business;

 

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		(c)	sale or other disposition of any of the Purchased Assets shown or reflected on the Balance Sheet,
except for the sale of Inventory in the ordinary course of business;

 

		(d)	cancellation of any debts or claims or amendment, termination or waiver of any rights constituting
Purchased Assets, except in the ordinary course of business;

 

		(e)	capital expenditures in an aggregate amount exceeding $50,000 which would constitute an Assumed
Liability;

 

		(f)	imposition of any Encumbrance upon any of the Purchased Assets, except for Permitted Encumbrances;

 

		(g)	increase in the compensation of its Employees, other than as provided for in any written agreements
or in the ordinary course of business; or

 

		(h)	any agreement to do any of the foregoing, or any action or omission that would result in any of
the foregoing.

 

Section 4.06         Material
Contracts.

 

		(a)	Schedule 4.06(a) of the Disclosure Schedules lists each of the following Contracts (x) by
which any of the Purchased Assets are bound or affected or (y) to which Seller is a party or by which it is bound in connection
with the Business or the Purchased Assets (together with all Leases listed in Schedule 4.09(a) of the Disclosure Schedules
and all Intellectual Property Agreements listed in Schedule 4.08(a) of the Disclosure Schedules, collectively, the "Material
Contracts"):

 

		(i)	each agreement of Seller in relation to the Business involving aggregate consideration in excess
of $50,000 or requiring performance by any party more than one year from the date hereof, which, in each case, cannot be cancelled
by Seller without penalty or without more than 90 days' notice;

 

		(ii)	all agreements that relate to the sale of any of the Purchased Assets, other than in the ordinary
course of business, for consideration in excess of $50,000;

 

		(iii)	all agreements that relate to the acquisition of any business, a material amount of membership
units or assets of any other Person or any real property (whether by merger, sale of membership units, sale of assets or otherwise);

 

		(iv)	except for agreements relating to trade receivables, all agreements relating to indebtedness (including,
without limitation, guarantees) of Seller in relation to the Business;

 

		(v)	all agreements between or among Seller on the one hand, and any Affiliate of Seller, on the other
hand; and

 

		(vi)	all collective bargaining agreements or agreements with any labor organization, union or association
to which Seller is a party.

 

		(b)	Seller is not in breach of, or default under, any Material Contract, except for such breaches or
defaults that would not have a Material Adverse Effect.

 

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Section 4.07         Title
to Tangible Personal Property. Seller has good and valid title to, or a valid leasehold interest in, all Tangible Personal
Property included in the Purchased Assets, free and clear of Encumbrances except for Permitted Encumbrances.

 

Section 4.08         Intellectual
Property.

 

		(a)	Schedule 4.08(a) of the Disclosure Schedules lists (i) all Intellectual Property Registrations
and (ii) all Intellectual Property Agreements. Except as would not have a Material Adverse Effect, Seller owns or has the right
to use all Intellectual Property Assets and the Intellectual Property licensed to Seller under the Intellectual Property Agreements.

 

		(b)	Except as would not have a Material Adverse Effect, to Seller's Knowledge: (i) the conduct of the
Business as currently conducted does not infringe, misappropriate, dilute or otherwise violate the Intellectual Property of any
Person; and (ii) no Person is infringing, misappropriating or otherwise violating any Intellectual Property Assets. Notwithstanding
anything to the contrary in this Agreement, this Section 4.07(b) constitutes the sole representation and warranty of the
Seller under this Agreement with respect to any actual or alleged infringement, misappropriation or other violation by Seller of
any Intellectual Property of any other Person.

 

Section 4.09         Real
Property

 

		(a)	Schedule 4.09(a) of the Disclosure Schedules sets forth all material real property leased
by Seller and primarily used in connection with the Business (collectively, the "Leased
Real Property"), and a list, as of the date of this Agreement, of all leases for each Leased Real Property (collectively,
the "Leases").

 

		(b)	Seller has not received any written notice of existing, pending or threatened (i) condemnation
proceedings affecting the Real Property, or (ii) zoning, building code or other moratorium proceedings, or similar matters which
would reasonably be expected to materially and adversely affect the ability to operate the Real Property as currently operated.
Neither the whole nor any material portion of any Real Property has been damaged or destroyed by fire or other casualty.

 

Section 4.10         Legal
Proceedings; Governmental Orders.

 

		(a)	There are no actions, suits, claims, investigations or other legal proceedings pending or, to Seller's
Knowledge, threatened against or by Seller relating to or affecting the Business, the Purchased Assets or the Assumed Liabilities,
which if determined adversely to Seller would result in a Material Adverse Effect.

 

		(b)	There are no outstanding Governmental Orders and no unsatisfied judgments, penalties or awards
against or affecting the Business or the Purchased Assets which would have a Material Adverse Effect.

 

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Section 4.11         Compliance
with Laws; Permits.

 

		(a)	Seller is in compliance with all Laws applicable to the conduct of the Business as currently conducted
or the ownership and use of the Purchased Assets, except where the failure to be in compliance would not have a Material Adverse
Effect.

 

		(b)	All Permits required for Seller to conduct the Business as currently conducted or for the ownership
and use of the Purchased Assets have been obtained by Seller and are valid and in full force and effect, except where the failure
to obtain such Permits would not have a Material Adverse Effect.

 

		(c)	None of the representations and warranties in this Section 4.10 shall be deemed to relate
to employment matters (which are governed by Section 4.12) or tax matters (which are governed by Section 4.13).

 

Section 4.12         Environmental
Matters. Except as set forth in Schedule 4.12 of the Disclosure Schedules, to Seller’s Knowledge, Seller has complied
and is in compliance in all material respects with all applicable Environmental Laws with respect to the Purchased Assets or the
operation of the Business and has obtained and is in compliance in all material respects with all applicable Environmental Permits
with respect to the Business or the Purchased Assets. No written notice of violation, notification of liability or potential liability
or request for information has been received by Seller and no Litigation is pending or, to Seller’s knowledge, threatened
in writing by any Person involving the Business or the Purchased Assets relating to or arising out of any Environmental Law. To
Seller’s knowledge, no written order naming Seller has been issued, and no penalty or fine has been assessed to Seller, involving
the Business, the Purchased Assets or any real property leased by Seller relating to or arising out of any applicable Environmental
Law.

 

Section 4.13         Employee
Benefit Matters.

 

		(a)	Schedule 4.13(a) of the Disclosure Schedules contains a list of each material benefit, retirement,
employment, consulting, compensation, incentive, bonus, phantom equity, change in control, severance, vacation, paid time off,
welfare and fringe-benefit agreement, plan, policy and program, whether or not reduced to writing, in effect and covering one or
more Employees, former employees of Seller, current or former directors of the Seller or the beneficiaries or dependents of any
such Persons, and is maintained, sponsored, contributed to, or required to be contributed to by the Seller, or under which the
Seller has any material liability for premiums or benefits (as listed on Schedule 4.13(a) of the Disclosure Schedules, each,
a "Benefit Plan").

 

		(b)	No Benefit Plan: (i) is subject to the minimum funding standards of Section 302 of ERISA or Section
412 of the Code; or (ii) is a "multi-employer plan" (as defined in Section 3(37) of ERISA). Except as would not have
a Material Adverse Effect, Seller: (i) has not withdrawn from any pension plan under circumstances resulting (or expected to result)
in a liability to the Pension Benefit Guaranty Corporation; or (ii) has not engaged in any transaction which would give rise to
a liability of Seller or Buyer under Section 4069 or Section 4212(c) of ERISA.

 

		(c)	Other than as required under Section 4980B of the Code or other applicable Law, no Benefit Plan
provides benefits or coverage in the nature of health, life or disability insurance following retirement or other termination of
employment (other than death benefits when termination occurs upon death).

 

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		(d)	Except as would not have a Material Adverse Effect: (i) there is no pending or, to Seller's Knowledge,
threatened action relating to a Benefit Plan; and (ii) no Benefit Plan has within the two years prior to the date hereof been the
subject of an examination or audit by a Governmental Authority.

 

		(e)	Except as would not have a Material Adverse Effect, no Benefit Plan exists that could: (i) result
in the payment to any Employee, director or consultant of any money or other property; (ii) accelerate the vesting of or provide
any additional rights or benefits (including funding of compensation or benefits through a trust or otherwise) to any Employee,
director or consultant, except as a result of any partial plan termination resulting from this Agreement; or (iii) limit or restrict
the ability of Buyer or its Affiliates to merge, amend or terminate any Benefit Plan, in each case, as a result of the execution
of this Agreement. Neither the execution of this Agreement nor the consummation of the transactions contemplated hereby will result
in "excess parachute payments" within the meaning of Section 280G(b) of the Code.

 

		(f)	The representations and warranties set forth in this Section are the Seller's sole and exclusive
representations and warranties regarding employee benefit matters.

 

Section 4.14         Employment
Matters.

 

		(a)	Seller is not a party to, or bound by, any collective bargaining or other agreement with a labor
organization representing any of the Employees. There has not been, nor, to Seller's Knowledge, has there been any threat of, any
strike, slowdown, work stoppage, lockout, concerted refusal to work overtime or other similar labor activity or dispute affecting
Seller or any of the Employees.

 

		(b)	Seller is in compliance with all applicable Laws pertaining to employment and employment practices
to the extent they relate to the Employees, except to the extent non-compliance would not result in a Material Adverse Effect.

 

		(c)	The representations and warranties set forth in this Section 4.12 are the Seller's sole
and exclusive representations and warranties regarding employment matters.

 

Section 4.15         Taxes.

 

		(a)	Except as would not have a Material Adverse Effect, Seller has filed (taking into account any valid
extensions) all material Tax Returns with respect to the Business required to be filed by Seller and has paid all Taxes shown thereon
as owing. Seller is not currently the beneficiary of any extension of time within which to file any material Tax Return other than
extensions of time to file Tax Returns obtained in the ordinary course of business.

 

		(b)	Seller is not a "foreign person" as that term is used in Treasury Regulations Section
1.1445-2.

 

		(c)	The representations and warranties set forth in this Section 4.13 are Seller's sole and
exclusive representations and warranties regarding Tax matters.

 

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Section 4.16         Affiliate
Transactions.

 

		(i)	Except as disclosed on Schedule 4.16(a) of the Disclosure Schedules, Seller has made available
to Buyer copies of each agreement, contract, arrangement, understanding, transfer of assets or liabilities or other commitment
or transaction, in each case since January 1, 2013, involving amounts in excess of Ten Thousand Dollars ($10,000), between Seller,
on the one hand, and any Affiliate or any stockholder, officer, director or employee of Seller or any Affiliate (each a “Related
Party”), on the other hand (a “Related Party Transaction”), other than any Related Party Transaction
that is necessary to effectuate (i) the transactions contemplated by this Agreement, and (ii) the matters to be concluded after
the Closing to effectuate the transactions contemplated under this Agreement.

 

		(ii)	Except as set forth on Schedule 4.16(b) of the Disclosure Schedules, no manager, officer
or director of Seller or any Affiliate, (i) owns, directly or indirectly, and whether on an individual, joint or other basis,
any equity interest in (x) any material property or asset, real or personal, tangible or intangible, used in or held for use
in connection with or pertaining to the Business other than the Purchased Assets, or (y) any Person, that is a supplier, customer
or competitor of the Business, or (ii) serves as an officer or director of any Person that is a supplier, customer or competitor
of the Business.

 

Section 4.17         Inventories.
The inventories included in the Balance Sheet were stated thereon at cost, net of appropriate Balance Sheet reserves. Since the
Balance Sheet Date, the inventories of Seller have been maintained in the ordinary course of business consistent with prior practice.
As of the Closing Date, all such inventories will be owned free and clear of all Liens, except Permitted Liens. All of the inventories
recorded on the Balance Sheet (i) consist of, and all inventories of Seller on the Closing Date will consist of, items of a quality
usable or saleable in the normal course of business consistent with past practices, and (ii) are or will be, subject to market
conditions, in quantities reasonably estimated to meet expected customer requirements over the 6 month period following the Closing
Date, in accordance with past practice. Other than in the ordinary course of business consistent with prior practice or as set
forth on Schedule 4.17 of the Disclosure Schedules, Seller has no obligation to purchase any inventory.

 

Section 4.18         Receivables.
All accounts receivable, notes receivable and other receivables (other than receivables collected since the Balance Sheet Date)
reflected on the Balance Sheet are, and all accounts receivable and notes receivable arising from or otherwise relating to the
Business of Seller as of the Closing Date will be, valid and genuine. All accounts receivable, notes receivable and other receivables
arising out of or relating to the Business as of the Balance Sheet Date have been included in the Balance Sheet, and all accounts
receivable, notes receivable and other receivables arising out of or relating to the Business as of the Closing Date will be included
in the ordinary course of business consistent with prior practice.

 

Section 4.19         Brokers.
No broker, finder or investment banker is entitled to any brokerage, finder's or other fee or commission in connection with the
transactions contemplated by this Agreement based upon arrangements made by or on behalf of Seller.

 

Section 4.20         Disclosure.
To the Knowledge of Seller, no representation or warranty in this Agreement contains any untrue statement of a material fact or
omits to state any statement necessary to make the representations and warranties made herein not misleading in light of the circumstances
under which they were made.

 

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Section 4.21         No
Other Representations and Warranties. Except for the representations and warranties contained in this Article IV (including
the related portions of the Disclosure Schedules), none of Seller or any other Person has made or makes any other express or implied
representation or warranty, either written or oral, on behalf of Seller, including any representation or warranty as to the accuracy
or completeness of any information regarding the Business furnished or made available to Buyer and its Representatives (including
the Confidential Information Memorandum made available by Seller) and any information, documents or material made available to
Buyer in the Data Room, management presentations or in any other form in expectation of the transactions contemplated hereby) or
as to the future revenue, profitability or success of the Business, or any representation or warranty arising from statute or otherwise
in Law.

 

Article
V

Representations and warranties of buyer

 

Except as set forth in the Disclosure Schedules,
Buyer represents and warrants to Seller that the statements contained in this Article V are true and correct as of the date
hereof.

 

Section 5.01         Organization
and Authority of Buyer. Buyer is a corporation duly organized, validly existing and in good standing under the Laws of the
state of Delaware. Buyer has all necessary corporate power and authority to enter into this Agreement, to carry out its obligations
hereunder and to consummate the transactions contemplated hereby. The execution and delivery by Buyer of this Agreement, the performance
by Buyer of its obligations hereunder and the consummation by Buyer of the transactions contemplated hereby have been duly authorized
by all requisite corporate action on the part of Buyer. When this Agreement, and each other Transaction Document to which Buyer
is or will be a party has been duly executed and delivered by Buyer, and (assuming due authorization, execution and delivery by
Seller) this Agreement and each other Transaction Document to which Buyer is or will be a party constitutes a legal, valid and
binding obligation of Buyer, enforceable against Buyer in accordance with its terms, except as such enforceability may be limited
by bankruptcy, insolvency, reorganization, moratorium or similar Laws affecting creditors' rights generally and by general principles
of equity (regardless of whether enforcement is sought in a proceeding at law or in equity).

 

Section 5.02         No
Conflicts; Consents. The execution, delivery and performance by Buyer of this Agreement, and the other Transaction Documents
to which it is a party, and the consummation of the transactions contemplated hereby, do not and will not: (a) result in a violation
or breach of any provision of the by-laws of Buyer; (b) result in a violation or breach of any provision of any Law or Governmental
Order applicable to Buyer; or (c) except as set forth in Schedule 5.02 of the Disclosure Schedules, require the consent,
notice or other action by any Person under, conflict with, result in a violation or breach of, constitute a default under or result
in the acceleration of any agreement to which Buyer is a party, except in the cases of clauses (b) and (c), where the violation,
breach, conflict, default, acceleration or failure to give notice would not have a material adverse effect on Buyer's ability to
consummate the transactions contemplated hereby. No consent, approval, Permit, Governmental Order, declaration or filing with,
or notice to, any Governmental Authority is required by or with respect to Buyer in connection with the execution and delivery
of this Agreement, and the other Transaction Documents to which it is a party, and the consummation of the transactions contemplated
hereby, and such consents, approvals, Permits, Governmental Orders, declarations, filings or notices which would not have a material
adverse effect on Buyer's ability to consummate the transactions contemplated hereby.

 

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Section 5.03         Brokers.
 No broker, finder or investment banker is entitled to any brokerage, finder's or other fee or commission in connection with
the transactions contemplated by this Agreement based upon arrangements made by or on behalf of Buyer.

 

Section 5.04         Solvency
Immediately after giving effect to the transactions contemplated hereby, Buyer shall be solvent and shall: (a) be able to pay
its debts as they become due; (b) own property that has a fair saleable value greater than the amounts required to pay its debts
(including a reasonable estimate of the amount of all contingent liabilities); and (c) have adequate capital to carry on its business.
In connection with the transactions contemplated hereby, Buyer has not incurred, nor plans to incur, debts beyond its ability to
pay as they become absolute and matured.

 

Section 5.05         Legal
Proceedings. Except as set forth in Schedule 5.05 of the Disclosure Schedules, there are no actions, suits, claims,
investigations or other legal proceedings pending or, to Buyer's knowledge, threatened against or by Buyer or any Affiliate of
Buyer that challenge or seek to prevent, enjoin or otherwise delay the transactions contemplated by this Agreement.

 

Section 5.06         Independent
Investigation. Buyer has conducted its own independent investigation, review and analysis of the Business, the Purchased Assets,
results of operations, prospects, condition (financial or otherwise), and acknowledges that it has been provided adequate access
to the personnel, properties, assets, premises, books and records, and other documents and data of Seller for such purpose. Buyer
acknowledges and agrees that: (a) in making its decision to enter into this Agreement and to consummate the transactions contemplated
hereby, Buyer has relied solely upon its own investigation and the express representations and warranties of Seller set forth in
Article IV of this Agreement (including the related portions of the Disclosure Schedules); and (b) neither Seller nor any
other Person has made any representation or warranty as to Seller, the Business, the Purchased Assets or this Agreement, except
as expressly set forth in Article IV of this Agreement (including the related portions of the Disclosure Schedules).

 

Article
VI

Covenants

 

Section 6.01         Conduct
of Business Prior to the Closing. From the date hereof until the Closing, except as otherwise provided in this Agreement or
consented to in writing by Buyer (which consent shall not be unreasonably withheld or delayed), Seller shall: (a) conduct the Business
in the ordinary course of business; and (b) use commercially reasonable efforts to maintain and preserve intact its current Business
organization, operations and franchise and to preserve the rights, franchises, goodwill and relationships of its Employees, customers,
lenders, suppliers, regulators and others having relationships with the Business. From the date hereof until the Closing Date,
except as consented to in writing by Buyer (which consent shall not be unreasonably withheld or delayed), Seller shall not take
any action that would cause any of the changes, events or conditions described in Section 4.04 to occur.

 

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Section 6.02         Access
to Information. From the date hereof until the Closing, Seller shall: (a) afford Buyer and its Representatives reasonable access
to and the right to inspect all of the Real Property, properties, assets, premises, Books and Records, Assigned Contracts, agreements
and other documents and data related to the Business; (b) furnish Buyer and its Representatives with such financial, operating
and other data and information related to the Business as Buyer or any of its Representatives may reasonably request; and (c) instruct
the Representatives of Seller to cooperate with Buyer in its investigation of the Business; provided, however, that any
such investigation shall be conducted during normal business hours upon reasonable advance notice to Seller, under the supervision
of Seller's personnel and in such a manner as not to interfere with the normal operations of the Business or any other businesses
of Seller. Notwithstanding anything to the contrary in this Agreement, Seller shall not be required to disclose any information
to Buyer if such disclosure would, in Seller's sole discretion: (x) cause significant competitive harm to Seller and its businesses,
including the Business, if the transactions contemplated by this Agreement are not consummated; (y) jeopardize any attorney-client
or other privilege; or (z) contravene any applicable Law, fiduciary duty or binding agreement entered into prior to the date of
this Agreement. Prior to the Closing, without the prior written consent of Seller, which may be withheld for any reason, Buyer
shall not contact any suppliers to, or customers of, the Business and Buyer shall have no right to perform invasive or subsurface
investigations of the Real Property.

 

Section 6.03         Supplement
to Disclosure Schedules. From time to time prior to the Closing, Seller shall have the right (but not the obligation) to supplement
or amend the Disclosure Schedules hereto with respect to any matter hereafter arising or of which it becomes aware after the date
hereof (each a "Schedule Supplement").
Any disclosure in any such Schedule Supplement shall not be deemed to have cured any inaccuracy in or breach of any representation
or warranty contained in this Agreement, including for purposes of the indemnification or termination rights contained in this
Agreement or of determining whether or not the conditions set forth in Section 7.01 have been satisfied; provided, however,
that if Buyer has the right to, but does not elect to, terminate this Agreement within three Business Days of its receipt of such
Schedule Supplement, then Buyer shall be deemed to have irrevocably waived any right to terminate this Agreement with respect to
such matter and, further, shall have irrevocably waived its right to indemnification under Section 8.02 with respect to
such matter.

 

Section 6.04         Employees
and Employee Benefit Plans.

 

		(a)	Buyer shall, or shall cause an Affiliate of Buyer to, offer employment effective on the Closing
Date, to all Employees, including Employees who are absent due to vacation, family leave, short-term disability or other approved
leave of absence (the Employees who accept such employment and commence employment on the Closing Date, the "Transferred
Employees").

 

		(b)	During the period commencing at the Closing, Buyer shall, or shall cause an Affiliate of Buyer
to, provide each Transferred Employee with: (i) base salary or hourly wages which are no less than the base salary or hourly wages
provided by Seller immediately prior to the Closing; (ii) target bonus opportunities (excluding equity-based compensation), if
any, which are no less than the target bonus opportunities (excluding equity-based compensation) provided by Seller immediately
prior to the Closing; (iii) retirement and welfare benefits that are no less favorable in the aggregate than those provided by
Seller immediately prior to the Closing; and (iv) severance benefits that are no less favorable than the practice, plan or policy
in effect for such Transferred Employee immediately prior to the Closing.

 

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		(c)	With respect to any employee benefit plan maintained by Buyer or an Affiliate of Buyer (collectively,
"Buyer Benefit Plans") for the benefit of any
Transferred Employees will participate effective as of the Closing, Buyer shall, or shall cause it Affiliates to, recognize all
service of the Transferred Employees with Seller or any of its Affiliates, as if such service were with Buyer, for vesting, eligibility
and accrual purposes; provided, however, such service shall not be recognized to the extent that (x) such recognition would
result in a duplication of benefits or (y) such service was not recognized under the corresponding Benefit Plan.

 

		(d)	Effective as of the Closing, the Transferred Employees shall cease active participation in the
Benefit Plans. Seller shall remain liable for all eligible claims for benefits under the Benefit Plans that are incurred by the
Employees prior to the Closing Date. For purposes of this Agreement, the following claims shall be deemed to be incurred as follows:
(i) life, accidental death and dismemberment, short-term disability, and workers' compensation insurance benefits, on the event
giving rise to such benefits; (ii) medical, vision, dental, and prescription drug benefits, on the date the applicable services,
materials or supplies were provided; and (iii) long-term disability benefits, on the eligibility date determined by the long-term
disability insurance carrier for the plan in which the applicable Employee participates.

 

		(e)	Buyer and Seller intend that the transactions contemplated by this Agreement should not constitute
a separation, termination or severance of employment of any Employee who accepts an employment offer by Buyer that is consistent
with the requirements of Section 6.04(a), including for purposes of any Benefit Plan that provides for separation, termination
or severance benefits, and that each such Employee will have continuous employment immediately before and immediately after the
Closing. Buyer shall be liable and hold the Seller harmless for: (i) any statutory, common law, contractual or other severance
with respect to any Employee, other than an Employee who has received an offer of employment by Buyer on terms and conditions consistent
with Section 6.04(a) hereof and declines such offer; and (ii) any claims relating to the employment of any Transferred Employee
arising in connection with or following the Closing.

 

		(f)	This Section 6.04 shall be binding upon and inure solely to the benefit of each of the parties
to this Agreement, and nothing in this Section 6.04, express or implied, shall confer upon any other Person any rights or
remedies of any nature whatsoever under or by reason of this Section 6.04. Nothing contained herein, express or implied,
shall be construed to establish, amend or modify any benefit plan, program, agreement or arrangement. The parties hereto acknowledge
and agree that the terms set forth in this Section 6.04 shall not create any right in any Transferred Employee or any other
Person to any continued employment with Buyer or any of its Affiliates or compensation or benefits of any nature or kind whatsoever.

 

Section 6.05         Governmental
Approvals and Other Third-party Consents

 

		(a)	Each party hereto shall, as promptly as possible, use its reasonable best efforts to obtain, or
cause to be obtained, all consents, authorizations, orders and approvals from all Governmental Authorities that may be or become
necessary for its execution and delivery of this Agreement and the performance of its obligations pursuant to this Agreement and
the other Transaction Documents. Each party shall cooperate fully with the other party and its Affiliates in promptly seeking to
obtain all such consents, authorizations, orders and approvals. The parties hereto shall not willfully take any action that will
have the effect of delaying, impairing or impeding the receipt of any required consents, authorizations, orders and approvals.

 

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		(b)	All analyses, appearances, meetings, discussions, presentations, memoranda, briefs, filings, arguments,
and proposals made by or on behalf of either party before any Governmental Authority or the staff or regulators of any Governmental
Authority, in connection with the transactions contemplated hereunder (but, for the avoidance of doubt, not including any interactions
between Seller or Buyer with Governmental Authorities in the ordinary course of business, any disclosure which is not permitted
by Law or any disclosure containing confidential information) shall be disclosed to the other party hereunder in advance of any
filing, submission or attendance, it being the intent that the parties will consult and cooperate with one another, and consider
in good faith the views of one another, in connection with any such analyses, appearances, meetings, discussions, presentations,
memoranda, briefs, filings, arguments, and proposals. Each party shall give notice to the other party with respect to any meeting,
discussion, appearance or contact with any Governmental Authority or the staff or regulators of any Governmental Authority, with
such notice being sufficient to provide the other party with the opportunity to attend and participate in such meeting, discussion,
appearance or contact.

 

		(c)	Seller and Buyer shall use commercially reasonable efforts to give all notices to, and obtain all
consents from, all third parties that are described in Schedule 4.02 of the Disclosure Schedules; provided, however,
that Seller shall not be obligated to pay any consideration therefor to any third party from whom consent or approval is requested.

 

Section 6.06         Books
and Records.

 

		(a)	In order to facilitate the resolution of any claims made against or incurred by Seller prior to
the Closing, or for any other reasonable purpose, for a period of two years after the Closing, Buyer shall:

 

		(i)	retain the books and records (including personnel files) relating to periods prior to the Closing
in a manner reasonably consistent with the prior practices of Seller; and

 

		(ii)	upon reasonable notice, afford Seller’s Representatives reasonable access (including the
right to make, at Seller's expense, photocopies), during normal business hours, to such books and records.

 

		(b)	In order to facilitate the resolution of any claims made by or against or incurred by Buyer after
the Closing, or for any other reasonable purpose, for a period of two years after the Closing, Seller shall:

 

		(i)	retain the books and records (including personnel files) of Seller which relate to the Business
and its operations for periods prior to the Closing; and

 

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		(ii)	upon reasonable notice, afford Buyer’s Representatives reasonable access (including the right
to make, at Buyer's expense, photocopies), during normal business hours, to such books and records.

 

		(c)	Neither Buyer nor Seller shall be obligated to provide the other party with access to any books
or records (including personnel files) pursuant to this Section 6.07 where such access would violate any Law.

 

Section 6.07         Closing
Conditions From the date hereof until the Closing, each party hereto shall use commercially reasonable efforts to take such
actions as are necessary to expeditiously satisfy the closing conditions set forth in Article VII hereof.

 

Section 6.08         Public
Announcements. Unless otherwise required by applicable Law (based upon the reasonable advice of counsel), no party to this
Agreement shall make any public announcements in respect of this Agreement or the transactions contemplated hereby or otherwise
communicate with any news media without the prior written consent of the other party (which consent shall not be unreasonably withheld
or delayed), and the parties shall cooperate as to the timing and contents of any such announcement.

 

Section 6.09         Bulk
Sales Laws. The parties hereby waive compliance with the provisions of any bulk sales, bulk transfer or similar Laws of any
jurisdiction that may otherwise be applicable with respect to the sale of any or all of the Purchased Assets to Buyer.

 

Section 6.10         Transfer
Taxes. All transfer, documentary, sales, use, stamp, registration, value added and other such Taxes and fees (including any
penalties and interest) incurred in connection with this Agreement and the other Transaction Documents (including any real property
transfer Tax and any other similar Tax) shall be borne and paid by Seller when due. Buyer shall, at its own expense, timely file
any Tax Return or other document with respect to such Taxes or fees (and Seller shall cooperate with respect thereto as necessary).

 

Section 6.11         Further
Assurances. Following the Closing, each of the parties hereto shall, and shall cause their respective Affiliates to, execute
and deliver such additional documents, instruments, conveyances and assurances, and take such further actions as may be reasonably
required to carry out the provisions hereof and give effect to the transactions contemplated by this Agreement and the other Transaction
Documents.

 

Article
VII

Conditions to Closing

 

Section 7.01         Conditions
to Obligations of All Parties. The obligations of each party to consummate the transactions contemplated by this Agreement
shall be subject to the fulfillment, at or prior to the Closing, of each of the following conditions:

 

		(a)	The filings of Buyer and Seller pursuant to the Hart Scott Rodino Antitrust Improvements Act, if
any, shall have been made and the applicable waiting period and any extensions thereof shall have expired or been terminated.

 

		(b)	No Governmental Authority shall have enacted, issued, promulgated, enforced or entered any Governmental
Order which is in effect and has the effect of making the transactions contemplated by this Agreement illegal, otherwise restraining
or prohibiting consummation of such transactions or causing any of the transactions contemplated hereunder to be rescinded following
completion thereof.

 

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Section 7.02         Conditions
to Obligations of Buyer.  The obligations of Buyer to consummate the transactions
contemplated by this Agreement shall be subject to the fulfillment or Buyer's waiver, at or prior to the Closing, of each of the
following conditions:

 

		(a)	The representations and warranties of Seller contained in Article
IV shall be true and correct in all respects as of the Closing Date with the same effect as though made at and as of
such date (except those representations and warranties that address matters only as of a specified date, which shall be true and
correct in all respects as of that specified date), except where the failure of such representations and warranties to be true
and correct would not have a Material Adverse Effect.

 

		(b)	Seller shall have duly performed and complied in all material respects with all agreements, covenants
and conditions required by this Agreement and the other Transaction Documents to be performed or complied with by it prior to or
on the Closing Date.

 

		(c)	Seller shall have delivered to Buyer duly executed counterparts to the Transaction Documents (other
than this Agreement) and such other documents and deliveries set forth in Section 3.02(a).

 

		(d)	Buyer shall have entered into an employment agreement with John Payne;

 

		(e)	The landlord of the premises occupied by the Seller in Mt Olive, New Jersey, consents to assignment
of the relevant sublease agreement from Seller to the Buyer, under terms reasonably acceptable to the Buyer, including but not
limited to extension of the termination date until at least February 5, 2017.

 

		(f)	Buyer shall have received Seller’s 2016 projections, prepared in good faith but not warranted,
for the amount of costs of goods sold that will come out of existing inventory.

 

		(g)	Buyer shall have received evidence, in a form acceptable to Buyer, of the release of the Lien on
the Purchased Assets held by Integrated Microwave Technologies, LLC, a Pennsylvania limited liability company.

 

		(h)	Buyer shall have received a certificate, dated the Closing Date and signed by a duly authorized
officer of Seller, that each of the conditions set forth in Section 7.02(a)
and Section 7.02(b) have been satisfied, and
that all Disclosure Schedules are correct as of the date hereof (the "Seller
Closing Certificate").

 

		(i)	Buyer shall have received a certificate of the Secretary or an Assistant Secretary (or equivalent
officer) of Seller certifying that attached thereto are true and complete copies of all resolutions adopted by the board of directors
of Seller authorizing the execution, delivery and performance of this Agreement, other Transaction Documents, and the consummation
of the transactions contemplated hereby, and that all such resolutions are in full force and effect and are all the resolutions
adopted in connection with the transactions contemplated hereby.

 

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		(j)	Buyer shall have received a certificate of the Secretary or an Assistant Secretary (or equivalent
officer) of Seller certifying the names and signatures of the officers of Seller authorized to sign this Agreement, other Transaction
Documents, and the other documents to be delivered hereunder.

 

		(k)	Buyer shall have received a certificate pursuant to Treasury Regulations Section 1.1445-2(b) (the
"FIRPTA Certificate") that Seller is not a foreign
person within the meaning of Section 1445 of the Code duly executed by Seller.

 

Section 7.03         Conditions
to Obligations of Seller.  The obligations of Seller to consummate the transactions
contemplated by this Agreement shall be subject to the fulfillment or Seller's waiver, at or prior to the Closing, of each of the
following conditions:

 

		(a)	The representations and warranties of Buyer contained in Article
V shall be true and correct in all respects as of the Closing Date with the same effect as though made at and as
of such date (except those representations and warranties that address matters only as of a specified date, which shall be true
and correct in all respects as of that specified date), except where the failure of such representations and warranties to be true
and correct would not have a material adverse effect on Buyer's ability to consummate the transactions contemplated hereby.

 

		(b)	Buyer shall have duly performed and complied in all material respects with all agreements, covenants
and conditions required by this Agreement, and each of the other Transaction Document, to be performed or complied with by it prior
to or on the Closing Date.

 

		(c)	Buyer shall have delivered to Seller the Initial Payment Note and Deferred Payment Note, duly executed
counterparts to the Transaction Documents (other than this Agreement) and such other documents and deliveries set forth in Section
3.02(b).

 

		(d)	Seller shall have received a certificate, dated the Closing Date and signed by a duly authorized
officer of Buyer, that each of the conditions set forth in Section 7.03(a) and Section
7.03(b) have been satisfied (the "Buyer Closing Certificate").

 

		(e)	Seller shall have received a certificate of the Secretary (or equivalent officer) of Buyer certifying
that attached thereto are true and complete copies of all resolutions adopted by the board of directors of Buyer authorizing the
execution, delivery and performance of this Agreement, the Transaction Documents and the other Transaction Documents and the consummation
of the transactions contemplated hereby, and that all such resolutions are in full force and effect and are all the resolutions
adopted in connection with the transactions contemplated hereby.

 

		(f)	Seller shall have received a certificate of the Secretary (or equivalent officer) of Buyer certifying
the names and signatures of the officers of Buyer authorized to sign this Agreement and the other documents to be delivered hereunder.

 

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Article
VIII

Indemnification

 

Section 8.01         Survival.
Subject to the limitations and other provisions of this Agreement, the representations and warranties contained herein shall
survive the Closing and, except in the case of fraud, shall remain in full force and effect until the date that is 18 months from
the Closing Date. None of the covenants or other agreements contained in this Agreement shall survive the Closing Date other than
those which by their terms contemplate performance after the Closing Date, and each such surviving covenant and agreement shall
survive the Closing for the period contemplated by its terms. Notwithstanding the foregoing, any claims asserted in good faith
with reasonable specificity (to the extent known at such time) and in writing by notice from the non-breaching party to the breaching
party prior to the expiration date of the applicable survival period shall not thereafter be barred by the expiration of such survival
period and such claims shall survive until finally resolved.

 

Section 8.02         Indemnification
by Seller. Subject to the other terms and conditions of this Article VIII, Seller shall indemnify Buyer against, and
shall hold Buyer harmless from and against, any and all Losses incurred or sustained by, or imposed upon, Buyer based upon, arising
out of, with respect to or by reason of:

 

		(a)	any inaccuracy in or breach of any of the representations or warranties of Seller contained in
this Agreement;

 

		(b)	any breach or non-fulfillment of any covenant, agreement or obligation to be performed by Seller
pursuant to this Agreement; or

 

		(c)	any Excluded Asset or any Excluded Liability.

 

Section 8.03         Indemnification
by Buyer. Subject to the other terms and conditions of this Article VIII, Buyer shall indemnify Seller against, and
shall hold Seller harmless from and against, any and all Losses incurred or sustained by, or imposed upon, Seller based upon, arising
out of, with respect to or by reason of:

 

		(a)	any inaccuracy in or breach of any of the representations or warranties of Buyer contained in this
Agreement;

 

		(b)	any breach or non-fulfillment of any covenant, agreement or obligation to be performed by Buyer
pursuant to this Agreement; or

 

		(c)	any Assumed Liability.

 

Section 8.04         Certain
Limitations. The party making a claim under this Article VIII is referred to as the "Indemnified
Party", and the party against whom such claims are asserted under this Article VIII is referred to as the
"Indemnifying Party". Except in
the case of fraud, the indemnification provided for in Section 8.02 and Section 8.03 shall be subject to the following
limitations:

 

		(a)	The Indemnifying Party shall not be liable to the Indemnified Party for indemnification under Section
8.02(a) or Section 8.03(a), as the case may be, until the aggregate amount of all Losses in respect of indemnification
under Section 8.02(a) or Section 8.03(a) exceeds $50,000 (the "Deductible"),
in which event the Indemnifying Party shall be required to pay or be liable for any and all Losses. With respect to any claim as
to which the Indemnified Party may be entitled to indemnification under Section 8.02(a) or Section 8.03(a), as the
case may be, the Indemnifying Party shall not be liable for any individual or series of related Losses which do not exceed $25,000
(which Losses shall be counted toward the Deductible).

 

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		(b)	The aggregate amount of all Losses for which an Indemnifying Party shall be liable pursuant to
Section 8.02(a) or Section 8.03(a) as the case may be, shall not exceed $1,500,000.

 

		(c)	Payments by an Indemnifying Party pursuant to Section 8.02 or Section 8.03 in respect
of any Loss shall be limited to the amount of any liability or damage that remains after deducting therefrom any insurance proceeds
and any indemnity, contribution or other similar payment received or reasonably expected to be received by the Indemnified Party
in respect of any such claim. The Indemnified Party shall use its commercially reasonable efforts to recover under insurance policies
or indemnity, contribution or other similar agreements for any Losses prior to seeking indemnification under this Agreement.

 

		(d)	Payments by an Indemnifying Party pursuant to Section 8.02 or Section 8.03 in respect
of any Loss shall be reduced by an amount equal to any Tax benefit realized or reasonably expected to be realized as a result of
such Loss by the Indemnified Party.

 

		(e)	In no event shall any Indemnifying Party be liable to any Indemnified Party for any punitive, incidental,
consequential, special or indirect damages, including loss of future revenue or income, loss of business reputation or opportunity
relating to the breach or alleged breach of this Agreement, or diminution of value or any damages based on any type of multiple.

 

		(f)	Each Indemnified Party shall take, and cause its Affiliates to take, all reasonable steps to mitigate
any Loss upon becoming aware of any event or circumstance that would be reasonably expected to, or does, give rise thereto, including
incurring costs only to the minimum extent necessary to remedy the breach that gives rise to such Loss.

 

		(g)	Seller shall not be liable under this Article VIII for any Losses based upon or arising
out of any inaccuracy in or breach of any of the representations or warranties of Seller contained in this Agreement if Buyer had
knowledge of such inaccuracy or breach prior to the Closing.

 

		(h)	If Buyer is an Indemnified Party all claims for indemnification by the Buyer for indemnification
pursuant to Section 8.02 may be satisfied, at Buyer’s option, through offset against the Installment Payment Note
or through the Deferred Payment Note.

 

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Section 8.05         Indemnification
Procedures.

 

		(a)	Third-Party Claims. If any Indemnified Party receives notice of the assertion or commencement
of any action, suit, claim or other legal proceeding made or brought by any Person who is not a party to this Agreement or an Affiliate
of a party to this Agreement or a Representative of the foregoing (a "Third-Party
Claim") against such Indemnified Party with respect to which the Indemnifying Party is obligated to provide indemnification
under this Agreement, the Indemnified Party shall give the Indemnifying Party prompt written notice thereof. The failure to give
such prompt written notice shall not, however, relieve the Indemnifying Party of its indemnification obligations, except and only
to the extent that the Indemnifying Party forfeits rights or defenses by reason of such failure. Such notice by the Indemnified
Party shall describe the Third-Party Claim in reasonable detail, shall include copies of all material written evidence thereof
and shall indicate the estimated amount, if reasonably practicable, of the Loss that has been or may be sustained by the Indemnified
Party. The Indemnifying Party shall have the right to participate in, or by giving written notice to the Indemnified Party, to
assume the defense of any Third-Party Claim at the Indemnifying Party's expense and by the Indemnifying Party's own counsel, and
the Indemnified Party shall cooperate in good faith in such defense. In the event that the Indemnifying Party assumes the defense
of any Third-Party Claim, subject to Section 8.05(b), it shall have the right to take such action as it deems necessary
to avoid, dispute, defend, appeal or make counterclaims pertaining to any such Third-Party Claim in the name and on behalf of the
Indemnified Party. The Indemnified Party shall have the right, at its own cost and expense, to participate in the defense of any
Third-Party Claim with counsel selected by it subject to the Indemnifying Party's right to control the defense thereof. If the
Indemnifying Party elects not to compromise or defend such Third-Party Claim or fails to promptly notify the Indemnified Party
in writing of its election to defend as provided in this Agreement, the Indemnified Party may, subject to Section 8.05(b),
pay, compromise, defend such Third-Party Claim and seek indemnification for any and all Losses based upon, arising from or relating
to such Third-Party Claim. Seller and Buyer shall cooperate with each other in all reasonable respects in connection with the defense
of any Third-Party Claim, including making available (subject to the provisions of Section 6.05) records relating to such
Third-Party Claim and furnishing, without expense (other than reimbursement of actual out-of-pocket expenses) to the defending
party, management employees of the non-defending party as may be reasonably necessary for the preparation of the defense of such
Third-Party Claim.

 

		(b)	Settlement of Third-Party Claims. Notwithstanding any other provision of this Agreement,
the Indemnifying Party shall not enter into settlement of any Third-Party Claim without the prior written consent of the Indemnified
Party (which consent shall not be unreasonably withheld or delayed), except as provided in this Section 8.05(b). If a firm
offer is made to settle a Third-Party Claim without leading to liability or the creation of a financial or other obligation on
the part of the Indemnified Party and provides, in customary form, for the unconditional release of each Indemnified Party from
all liabilities and obligations in connection with such Third-Party Claim and the Indemnifying Party desires to accept and agree
to such offer, the Indemnifying Party shall give written notice to that effect to the Indemnified Party. If the Indemnified Party
fails to consent to such firm offer within ten days after its receipt of such notice, the Indemnified Party may continue to contest
or defend such Third-Party Claim and in such event, the maximum liability of the Indemnifying Party as to such Third-Party Claim
shall not exceed the amount of such settlement offer. If the Indemnified Party fails to consent to such firm offer and also fails
to assume defense of such Third-Party Claim, the Indemnifying Party may settle the Third-Party Claim upon the terms set forth in
such firm offer to settle such Third-Party Claim. If the Indemnified Party has assumed the defense pursuant to Section 8.05(a),
it shall not agree to any settlement without the written consent of the Indemnifying Party (which consent shall not be unreasonably
withheld or delayed).

 

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		(c)	Direct Claims. Any claim by an Indemnified Party on account of a Loss which does not result
from a Third-Party Claim (a "Direct Claim") shall
be asserted by the Indemnified Party giving the Indemnifying Party prompt written notice thereof. The failure to give such prompt
written notice shall not, however, relieve the Indemnifying Party of its indemnification obligations, except and only to the extent
that the Indemnifying Party forfeits rights or defenses by reason of such failure. Such notice by the Indemnified Party shall describe
the Direct Claim in reasonable detail, shall include copies of all material written evidence thereof and shall indicate the estimated
amount, if reasonably practicable, of the Loss that has been or may be sustained by the Indemnified Party. The Indemnifying Party
shall have 30 days after its receipt of such notice to respond in writing to such Direct Claim. During such 30-day period, the
Indemnified Party shall allow the Indemnifying Party and its professional advisors to investigate the matter or circumstance alleged
to give rise to the Direct Claim, and whether and to what extent any amount is payable in respect of the Direct Claim and the Indemnified
Party shall assist the Indemnifying Party's investigation by giving such information and assistance (including access to the Indemnified
Party’s premises and personnel and the right to examine and copy any accounts, documents or records) as the Indemnifying
Party or any of its professional advisors may reasonably request. If the Indemnifying Party does not so respond within such 30-day
period, the Indemnifying Party shall be deemed to have rejected such claim, in which case the Indemnified Party shall be free to
pursue such remedies as may be available to the Indemnified Party on the terms and subject to the provisions of this Agreement.

 

Section 8.06         Tax
Treatment of Indemnification Payments. All indemnification payments made under this Agreement shall be treated by the parties
as an adjustment to the Purchase Price for Tax purposes, unless otherwise required by Law.

 

Section 8.07         Exclusive
Remedies. Subject to Section 10.11, the parties acknowledge and agree that their sole and exclusive remedy with respect
to any and all claims (other than claims arising from fraud on the part of a party hereto in connection with the transactions contemplated
by this Agreement) for any breach of any representation, warranty, covenant, agreement or obligation set forth herein or otherwise
relating to the subject matter of this Agreement, shall be pursuant to the indemnification provisions set forth in this Article
VIII. In furtherance of the foregoing, each party hereby waives, to the fullest extent permitted under Law, any and all rights,
claims and causes of action for any breach of any representation, warranty, covenant, agreement or obligation set forth herein
or otherwise relating to the subject matter of this Agreement it may have against the other parties hereto and their Affiliates
and each of their respective Representatives arising under or based upon any Law, except pursuant to the indemnification provisions
set forth in this Article VIII. Nothing in this Section 8.07 shall limit any Person's right to seek and obtain any
equitable relief to which any Person shall be entitled pursuant to Section 10.11 or to seek any remedy on account of fraud
by any party hereto.

 

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Article
IX

Termination

 

Section 9.01         Termination.
 This Agreement may be
terminated at any time prior to the Closing:

 

		(a)	by the mutual written consent of Seller and Buyer;

 

		(b)	by Buyer by written notice to Seller if Buyer is not then in material breach of any provision of
this Agreement and there has been a material breach, inaccuracy in or failure to perform any representation, warranty, covenant
or agreement made by Seller pursuant to this Agreement that would give rise to the failure of any of the conditions specified in Article
VII and such breach, inaccuracy or failure cannot be cured by Seller by February 29, 2016 (the "Drop
Dead Date");

 

		(c)	by Seller by written notice to Buyer if Seller is not then in material breach of any provision
of this Agreement and there has been a material breach, inaccuracy in or failure to perform any representation, warranty, covenant
or agreement made by Buyer pursuant to this Agreement that would give rise to the failure of any of the conditions specified in Article
VII and such breach, inaccuracy or failure cannot be cured by Buyer by the Drop Dead Date;

 

		(d)	by Buyer or Seller in the event that:

 

		(i)	there shall be any Law that makes consummation of the transactions contemplated by this Agreement
illegal or otherwise prohibited; or

 

		(ii)	any Governmental Authority shall have issued a Governmental Order restraining or enjoining the
transactions contemplated by this Agreement, and such Governmental Order shall have become final and non-appealable.

 

Section 9.02         Effect
of Termination. In the event of the termination of this Agreement in accordance with this Article
IX, this Agreement shall forthwith become void and there shall be no liability on the part of any party hereto except:

 

		(a)	as set forth in this Article IX and Section
6.08 and Article X hereof; and

 

		(b)	that nothing herein shall relieve any party hereto from liability for any intentional breach of
any provision hereof.

 

Article
X

Miscellaneous

 

Section 10.01         Expenses.
All costs and expenses, including, without limitation, fees and disbursements of counsel, financial advisors and accountants,
incurred in connection with this Agreement and the transactions contemplated hereby shall be paid by the party incurring such costs
and expenses.

 

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Section 10.02         Notices.
All notices, requests, consents, claims, demands, waivers and other communications hereunder shall be in writing and shall
be deemed to have been given: (a) when delivered by hand (with written confirmation of receipt); (b) when received by the addressee
if sent by a nationally recognized overnight courier (receipt requested); (c) on the date sent by facsimile or e-mail of a PDF
document (with confirmation of transmission) if sent during normal business hours of the recipient, and on the next Business Day
if sent after normal business hours of the recipient; or (d) on the third day after the date mailed, by certified or registered
mail, return receipt requested, postage prepaid. Such communications must be sent to the respective parties at the following addresses
(or at such other address for a party as shall be specified in a notice given in accordance with this Section 10.02):

 

 

	If to Seller:	Skyview Capital, LLC
	 	Suite 810-N
	 	2000 Avenue of the Stars
	 	Los Angeles, CA 90067
	 	 
	 	E-mail:	jhall@skyviewcapital.com
	 	Attention:	James F Hall, General Counsel
	 	 
	If to Buyer:	xG Technology, Inc.
	 	240 South Pineapple Avenue
	 	Suite 701
	 	Sarasota, FL 34236
	 	E-mail:	rbranton@mooersco.com
	 	Attention:	Roger G. Branton, CFO
	 	 
	with a copy to:	Robinson Brog Leinwand Greene Genovese & Gluck P.C.
	 	875 Third Ave., 9th Floor
	 	New York, NY 10022
	 	 
	 	E-mail:	ded@robinsonbrog.com
	 	Attention:	David E. Danovitch, Esq.

 

Section 10.03         Interpretation.
For purposes of this Agreement: (a) the words "include," "includes" and "including" shall be
deemed to be followed by the words "without limitation"; (b) the word "or" is not exclusive; and (c) the words
"herein," "hereof," "hereby," "hereto" and "hereunder" refer to this Agreement
as a whole. Unless the context otherwise requires, references herein: (x) to Articles, Sections, Disclosure Schedules and Exhibits
mean the Articles and Sections of, and Disclosure Schedules and Exhibits attached to, this Agreement; (y) to an agreement, instrument
or other document means such agreement, instrument or other document as amended, supplemented and modified from time to time to
the extent permitted by the provisions thereof; and (z) to a statute means such statute as amended from time to time and includes
any successor legislation thereto and any regulations promulgated thereunder. This Agreement shall be construed without regard
to any presumption or rule requiring construction or interpretation against the party drafting an instrument or causing any instrument
to be drafted. The Disclosure Schedules and Exhibits referred to herein shall be construed with, and as an integral part of, this
Agreement to the same extent as if they were set forth verbatim herein.

 

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Section 10.04         Headings.
The headings in this Agreement are for reference only and shall not affect the interpretation of this Agreement.

 

Section 10.05         Severability.
If any term or provision of this Agreement is invalid, illegal or unenforceable in any jurisdiction, such invalidity, illegality
or unenforceability shall not affect any other term or provision of this Agreement or invalidate or render unenforceable such term
or provision in any other jurisdiction. Upon such determination that any term or other provision is invalid, illegal or unenforceable,
the parties hereto shall negotiate in good faith to modify this Agreement so as to effect the original intent of the parties as
closely as possible in a mutually acceptable manner in order that the transactions contemplated hereby be consummated as originally
contemplated to the greatest extent possible.

 

Section 10.06         Entire
Agreement. This Agreement constitutes the sole and entire agreement of the parties to this Agreement with respect to the subject
matter contained herein and therein, and supersede all prior and contemporaneous representations, warranties, understandings and
agreements, both written and oral, with respect to such subject matter. In the event of any inconsistency between the statements
in the body of this Agreement, the Exhibits and Disclosure Schedules (other than an exception expressly set forth as such in the
Disclosure Schedules), the statements in the body of this Agreement will control.

 

Section 10.07         Successors
and Assigns. This Agreement shall be binding upon and shall inure to the benefit of the parties hereto and their respective
successors and permitted assigns. Neither party may assign its rights or obligations hereunder without the prior written consent
of the other party, which consent shall not be unreasonably withheld or delayed. No assignment shall relieve the assigning party
of any of its obligations hereunder.

 

Section 10.08         No
Third-party Beneficiaries. This Agreement is for the sole benefit of the parties hereto and their respective successors and
permitted assigns and nothing herein, express or implied, is intended to or shall confer upon any other Person or entity any legal
or equitable right, benefit or remedy of any nature whatsoever under or by reason of this Agreement.

 

Section 10.09         Amendment
and Modification; Waiver. This Agreement may only be amended, modified or supplemented by an agreement in writing signed by
each party hereto. No waiver by any party of any of the provisions hereof shall be effective unless explicitly set forth in writing
and signed by the party so waiving. No waiver by any party shall operate or be construed as a waiver in respect of any failure,
breach or default not expressly identified by such written waiver, whether of a similar or different character, and whether occurring
before or after that waiver. No failure to exercise, or delay in exercising, any right, remedy, power or privilege arising from
this Agreement shall operate or be construed as a waiver thereof; nor shall any single or partial exercise of any right, remedy,
power or privilege hereunder preclude any other or further exercise thereof or the exercise of any other right, remedy, power or
privilege.

 

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Section 10.10         Governing
Law; Submission to Jurisdiction; Waiver of Jury Trial.

 

		(a)	This Agreement shall be governed by and construed in accordance with the internal laws of the State
of New York, without giving effect to any choice or conflict of law provision or rule (whether of the State of New York or any
other jurisdiction).

 

		(b)	ANY LEGAL SUIT, ACTION OR PROCEEDING ARISING OUT OF OR BASED UPON THIS AGREEMENT, THE OTHER TRANSACTION
DOCUMENTS OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY MAY BE INSTITUTED IN THE FEDERAL COURTS OF THE UNITED STATES OF AMERICA
OR THE COURTS OF THE STATE OF NEW YORK IN EACH CASE LOCATED IN THE CITY OF NEW YORK, AND EACH PARTY IRREVOCABLY SUBMITS TO THE
EXCLUSIVE JURISDICTION OF SUCH COURTS IN ANY SUCH SUIT, ACTION OR PROCEEDING. SERVICE OF PROCESS, SUMMONS, NOTICE OR OTHER DOCUMENT
BY MAIL TO SUCH PARTY'S ADDRESS SET FORTH HEREIN SHALL BE EFFECTIVE SERVICE OF PROCESS FOR ANY SUIT, ACTION OR OTHER PROCEEDING
BROUGHT IN ANY SUCH COURT. THE PARTIES IRREVOCABLY AND UNCONDITIONALLY WAIVE ANY OBJECTION TO THE LAYING OF VENUE OF ANY SUIT,
ACTION OR ANY PROCEEDING IN SUCH COURTS AND IRREVOCABLY WAIVE AND AGREE NOT TO PLEAD OR CLAIM IN ANY SUCH COURT THAT ANY SUCH SUIT,
ACTION OR PROCEEDING BROUGHT IN ANY SUCH COURT HAS BEEN BROUGHT IN AN INCONVENIENT FORUM.

 

		(c)	EACH PARTY ACKNOWLEDGES AND AGREES THAT ANY CONTROVERSY WHICH MAY ARISE UNDER THIS AGREEMENT OR
THE OTHER TRANSACTION DOCUMENTS IS LIKELY TO INVOLVE COMPLICATED AND DIFFICULT ISSUES AND, THEREFORE, EACH SUCH PARTY IRREVOCABLY
AND UNCONDITIONALLY WAIVES ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LEGAL ACTION ARISING OUT OF OR RELATING TO
THIS AGREEMENT, THE OTHER TRANSACTION DOCUMENTS OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY. EACH PARTY TO THIS AGREEMENT
CERTIFIES AND ACKNOWLEDGES THAT (A) NO REPRESENTATIVE OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER
PARTY WOULD NOT SEEK TO ENFORCE THE FOREGOING WAIVER IN THE EVENT OF A LEGAL ACTION, (B) SUCH PARTY HAS CONSIDERED THE IMPLICATIONS
OF THIS WAIVER, (C) SUCH PARTY MAKES THIS WAIVER VOLUNTARILY, AND (D) SUCH PARTY HAS BEEN INDUCED TO ENTER INTO THIS AGREEMENT
BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS Section 10.10(c).

 

Section 10.11         Specific
Performance. The parties agree that irreparable damage would occur if any provision of this Agreement were not performed in
accordance with the terms hereof and that the parties shall be entitled to specific performance of the terms hereof, in addition
to any other remedy to which they are entitled at law or in equity.

 

Section 10.12         Counterparts.
This Agreement may be executed in counterparts, each of which shall be deemed an original, but all of which together shall
be deemed to be one and the same agreement. A signed copy of this Agreement delivered by facsimile, e-mail or other means of electronic
transmission shall be deemed to have the same legal effect as delivery of an original signed copy of this Agreement.

 

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Section 10.13         Non-recourse.
This Agreement may only be enforced against, and any claim, action, suit or other legal proceeding based upon, arising out
of, or related to this Agreement, or the negotiation, execution or performance of this Agreement, may only be brought against the
entities that are expressly named as parties hereto and then only with respect to the specific obligations set forth herein with
respect to such party. No past, present or future director, officer, employee, incorporator, manager, member, partner, stockholder,
Affiliate, agent, attorney or other Representative of any party hereto or of any Affiliate of any party hereto, or any of their
successors or permitted assigns, shall have any liability for any obligations or liabilities of any party hereto under this Agreement
or for any claim, action, suit or other legal proceeding based on, in respect of or by reason of the transactions contemplated
hereby.

 

[SIGNATURE PAGE FOLLOWS]

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IN WITNESS WHEREOF, the parties
hereto have caused this Agreement to be executed as of the date first written above by their respective officers thereunto duly
authorized.

	 	 	 
	 	Integrated Microwave Technologies, LLC
	 	 	 
	 	By	/s/ Alex Soltani
	 	 	Name: Alex Soltani
	 	 	Title: Manager
	 	 	 
	 	xG Technology, Inc.
	 	 	 
	 	By	/s/ Roger Branton 
	 	 	Name: Roger Branton
	 	 	Title: CFO

 

     35

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