Document:

Exhibit 10.40

 

ONYX PHARMACEUTICALS, INC.

2013 CASH PERFORMANCE INCENTIVE PLAN

 

ADOPTED: MARCH 26, 2013

APPROVED BY THE STOCKHOLDERS: MAY 23, 2013

 

1.                                      GENERAL

 

The Cash Performance Incentive Plan (the “Plan”) is a cash incentive plan intended to motivate executives of Onyx Pharmaceuticals, Inc. (the “Company”) to achieve short-term and long-term corporate objectives relating to the performance of the Company or one or more of the Company’s business units, divisions, affiliates or business segments, as established by the Plan Administrator (as defined below), and to reward such executives when those objectives are achieved, thereby tying Company performance to stockholder value.

 

2.                                      ADMINISTRATION

 

The Performance Incentive Plan shall be administered by the Compensation Committee (the “Committee”) of the Board of Directors (the “Board”) of the Company or a sub-committee thereof, in either case consisting solely of two or more outside directors of the Company who satisfy the requirements of Section 162(m) of the Internal Revenue Code of 1986, as amended (the “Code”), and such committee or sub-committee shall be referred to herein as the “Plan Administrator.” Among other things, the Plan Administrator will have the authority to select participants in the Plan, to determine the performance goals, award amounts and other terms and conditions of awards under the Plan. The Plan Administrator also will have the authority to establish and amend rules and regulations relating to the administration of the Plan. All decisions made by the Plan Administrator in connection with the Plan will be made in the Plan Administrator’s sole and absolute discretion and will be final and conclusive. The Plan Administrator will administer the Plan in a manner intended to comply with the requirements for “performance-based compensation” under Section 162(m) of the Code, except in the case of awards that are not intended to qualify as “performance-based compensation.”

 

3.                                      ELIGIBILITY

 

The Plan Administrator has the sole authority to designate the executives of the Company who will participate in the Plan. No executive is automatically entitled to participate in the Plan and participation in the Plan for any Performance Period (as such term is defined in Section 5) does not guarantee participation in the Plan in respect of any other Performance Period. Any executive of the Company designated by the Plan Administrator as a participant in the Plan with respect to any Performance Period shall be referred to herein as a “Participant.”

 

4.                                      COMPLIANCE WITH SECTION 162(m)

 

In general, awards under the Plan that are based on the attainment of one or more Performance Goals (as such term is defined in Section 5) during a Performance Period are

 

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intended to qualify as “performance-based compensation” under Section 162(m) of the Code. However, Participants may receive awards under the Plan based on the attainment of corporate or individual performance goals that either (a) are not based on one or more of the Performance Criteria or (b) are not intended to qualify as “performance-based compensation” under Section 162(m) of the Code.

 

5.                                      PERFORMANCE CRITERIA, PERFORMANCE GOALS, AND PERFORMANCE PERIODS

 

Pursuant to the terms of the Plan, the Plan Administrator may establish in writing one or more objective performance goals (each, a “Performance Goal” and collectively, the “Performance Goals”) based on the attainment of specified levels of one or more of the following “performance criteria” (the “Performance Criteria”): (i) earnings per share; (ii) earnings before interest, taxes and depreciation; (iii) earnings before interest, taxes, depreciation and amortization (EBITDA); (iv) net earnings; (v) return on equity; (vi) return on assets, investment, or capital employed; (vii) operating margin; (viii) gross margin; (ix) operating income; (x) net income (before or after taxes); (xi) net operating income; (xii) net operating income after tax; (xiii) pre- and after-tax income; (xiv) pre-tax profit; (xv) operating cash flow; (xvi) sales or revenue targets; (xvii) increases in revenue or product revenue; (xviii) expenses and cost reduction goals; (xix) improvement in or attainment of expense levels; (xx) improvement in or attainment of working capital levels; (xxi) economic value added; (xxii) market share; (xxiii) cash flow; (xxiv) cash flow per share; (xxv) share price performance; (xxvi) debt reduction; (xxvii) implementation or completion of projects or processes (including, without limitation, clinical trial initiation, clinical trial enrollment, clinical trial results, new and supplemental indications for existing products, regulatory filing submissions, regulatory filing acceptances, regulatory or advisory committee interactions, regulatory approvals, and product supply); (xxviii) customer satisfaction; (xxix) total stockholder return; and (xxx) stockholders’ equity. The Plan Administrator, in its sole discretion, shall determine the manner of calculating the specified Performance Goals selected for a Performance Period.

 

With respect to a Performance Period, the Performance Goals may be established on a Company-wide basis or with respect to one or more of the Company’s business units, divisions, affiliates, or business segments, and may be measured in either absolute terms or relative to the performance of one or more comparable companies or a relevant index. The Plan Administrator is authorized to make adjustments in the method of calculating the attainment of Performance Goals for a Performance Period as follows: (i) to exclude restructuring and/or other nonrecurring charges; (ii) to exclude exchange rate effects, as applicable, for non-U.S. dollar denominated net sales and operating earnings; (iii) to exclude the effects of changes to generally accepted accounting standards required by the Financial Accounting Standards Board; (iv) to exclude the effects of any statutory adjustments to corporate tax rates; and (v) to exclude the effects of any “extraordinary items” as determined under generally accepted accounting principles.

 

Notwithstanding the preceding provisions of this Section 5, the Plan Administrator may establish in writing corporate or individual performance goals that either (a) are not based on one or more of the Performance Criteria or (b) are not intended to result in the corresponding awards pursuant to the Plan qualifying as “performance-based compensation” under Section 162(m) of the Code.

 

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Pursuant to the terms of the Plan, the Plan Administrator will also establish one or more periods of time (each, a “Performance Period”), which may be of varying and overlapping durations, over which the attainment of one or more Performance Goals (or, in the case of awards not intended to qualify as “performance-based compensation” under Section 162(m) of the Code, the attainment of corporate or individual performance goals that are not based on one or more of the Performance Criteria) will be measured for the purpose of determining a Participant’s entitlement to an award under the Plan.

 

6.                                      TERMS OF AWARDS

 

With respect to each Performance Period, the Plan Administrator will establish the applicable Performance Goals for such Performance Period based on some or all of the Performance Criteria set forth in Section 5 (or will establish corporate or individual performance goals that are not based on one or more of the Performance Criteria, in the case of awards not intended to qualify as “performance-based compensation” under Section 162(m) of the Code). With respect to awards under the Plan that are intended to qualify as “performance- based compensation under Section 162(m) of the Code, prior to the earlier of (i) ninety (90) days following the commencement of the applicable Performance Period and (ii) the passage of twenty-five percent (25%) of the duration of such Performance Period and while the outcome is substantially uncertain, the Plan Administrator will establish in writing the Performance Goals for each award to a Participant under the Plan and the threshold, target and maximum amounts of the award, as applicable, that may be earned if the Performance Goals are achieved at the levels corresponding to such amounts. The Performance Goals (or corporate or individual performance goals that are not based on one or more of the Performance Criteria, in the case of awards not intended to qualify as “performance-based compensation” under Section 162(m) of the Code) established in respect of a Performance Period may differ from those established in respect of other Performance Periods and may differ for each Participant.

 

After the end of the applicable Performance Period, the Plan Administrator will certify in writing the extent to which the previously established Performance Goals (or, in the case of awards not intended to qualify as “performance-based compensation” under Section 162(m) of the Code, such other corporate or individual performance goals) were achieved and will determine the amount of the award, if any, that is payable to each Participant for such Performance Period. The Plan Administrator will have the discretion to determine that the actual amount paid with respect to a Participant’s award will be equal to or less than (but not greater than) the maximum payout calculated on the basis of the level of achievement of the applicable Performance Goals (or, in the case of awards not intended to qualify as “performance-based compensation” under Section 162(m) of the Code, such other corporate or individual performance goals) with respect to the Performance Period. The maximum payout for awards under the Plan to any one Participant in any one calendar year is $3.5 million.

 

7.                                      ALTERNATIVE METHOD

 

As an alternative to establishing and determining awards pursuant to Section 6, the Plan Administrator may establish one or more Performance Goals for a Performance Period based on one or more of the Performance Criteria (each, a “Threshold Goal”). The Threshold Goal may be established on a Company-wide basis or with respect to one or more of the Company’s

 

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business units, divisions, affiliates or business segments, and may be measured either absolutely or relative to a designated group of comparable companies or a relevant index. The Threshold Goal must be established by the Plan Administrator in writing not later than ninety (90) days after the start of the Performance Period, but in no event after twenty-five percent (25%) of the Performance Period has elapsed, provided that the outcome of the Threshold Goal is substantially uncertain at such time.

 

If the Threshold Goal is achieved, each Participant shall be eligible to earn a maximum award (the “Maximum Award”), the amount of which will be established no later than the time when the Performance Goals applicable to the Performance Period are established. No awards shall be earned or payable under the Plan unless the Threshold Goal is achieved. If the Threshold Goal is achieved, each Participant’s Maximum Award shall be subject to possible reduction by the Plan Administrator based on such factors as determined by the Plan Administrator, in its sole and absolute discretion, and the actual award payable to a Participant under the Plan shall be the Maximum Award, or a portion thereof, based on the attainment of the specified Performance Goals and such additional factors as determined by the Plan Administrator, in its sole and absolute discretion.

 

8.                                      PLAN PAYMENTS

 

Awards, if any, under the Plan will be payable following the end of each Performance Period. A Participant must be a regular employee of the Company on the last day of the applicable Performance Period in order to earn any award in respect of such Performance Period.

 

Payments, if any, under the Plan will be paid as soon as administratively feasible after the Plan Administrator certifies in writing the extent to which the Performance Goals (or, in the case of awards not intended to qualify as “performance-based compensation” under Section 162(m) of the Code, such other corporate or individual performance goals that are not based on one or more of the Performance Criteria) were achieved for the applicable Performance Period and determines the amount of the award, if any, payable to each Participant, but in no event later than March 15 of the calendar year following the end of the applicable Performance Period. All payments under the Plan will be subject to applicable tax withholding and other deductions.

 

9.                                      TERM OF THE PLAN

 

Subject to stockholder approval of the Plan in 2013, the Plan shall first apply to Performance Periods that begin after the date of such approval and shall continue in effect until the earlier of (i) the date on which the Plan Administrator terminates the Plan and (ii) the date of the first stockholder meeting that occurs in 2018, unless the Company’s stockholders again approve the Plan on or before such date.

 

10.                               REPAYMENT FOR MISCONDUCT

 

Any payment to a Participant under the Plan shall be subject to repayment or forfeiture, as applicable, if all of the following conditions are met: (i) the Company or any of its subsidiaries restates any financial report that, due to misconduct as determined by the Plan Administrator, was materially noncompliant with the securities laws when filed; (ii) the Participant is subject to

 

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Section 16 of the Securities Exchange Act of 1934, as amended; and (iii) the Participant receives any amounts under the Plan during the twelve- month period after the restated financial report (i.e., the financial report that was later restated) was first publicly issued or filed with the U.S. Securities and Exchange Commission.

 

If, in the Plan Administrator’s opinion, the Participant knowingly or with gross negligence engaged in such misconduct, the Participant (i) shall repay to the Company any amounts received under the Plan during the aforementioned twelve-month period, and (ii) to the extent the Participant defers any portion of such amounts under any applicable plan, shall forfeit (or repay to the Company, if previously distributed) such deferred amounts and any matching contributions allocated to the Participant under that plan on such deferred amounts. If the Plan Administrator determines that the Participant engaged in such misconduct, the Plan Administrator shall determine, in its sole and absolute discretion, to effect such repayment or forfeiture by any legally permitted means that the Plan Administrator considers appropriate.

 

11.                               SECTION 409A OF THE INTERNAL REVENUE CODE

 

It is intended that the Plan and any awards granted under the Plan be exempt from the requirements of Section 409A of the Code, and the Plan Administrator shall interpret and administer the Plan accordingly.

 

12.                               UNFUNDED OBLIGATION

 

The Company’s obligations under the Plan will, in every case, be an unfunded and unsecured promise. A Participants’ rights as to any benefits under the Plan shall be no greater than those of general, unsecured creditors of the Company. The Company will not be obligated to fund its financial obligations under the Plan.

 

13.                               AMENDMENT AND TERMINATION

 

The Committee may amend, modify suspend or terminate the Plan, in whole or in part, at any time and in any respect, including the adoption of amendments deemed necessary in order to (i) comply with Section 162(m) of the Code or (ii) be exempt from Section 409A of the Code. However, in no event may any such amendment, modification, suspension or termination result in an increase in the amount of compensation payable as identified for any Performance Period or cause compensation that is intended to qualify as “performance-based compensation” under Section 162(m) of the Code to fail to so qualify.

 

5Exhibit 10.1

 

 

Securities
purchase agreement

This Securities Purchase
Agreement (this “Agreement”), is dated as of May 21, 2013, among GUIDED THERAPEUTICS, INC., a Delaware corporation
(the “Company”), and each entity that is listed on the signature pages hereto. Each such entity, together
with its successors and permitted assigns, is referred to herein as a “Purchaser,” and all such entities, together
with their successors and permitted assigns, are collectively referred to herein as the “Purchasers.”

The Company proposes
to issue and sell to the Purchasers an aggregate of up to 3,000 shares of the Company’s Series B Convertible Preferred Stock,
par value $.001 per share (the “Preferred Stock”), at a purchase price of $1,000.00 per share, on the terms
and subject to the conditions set forth in this Agreement.

The Preferred Stock
will have the terms set forth in the certificate of designations designating the Preferred Stock in substantially the form attached
hereto as Exhibit A (the “Preferred Stock Designation”). The Company will file the Preferred Stock Designation
with the Delaware Secretary of State prior to and as a condition to the closing (the “Closing”) of the Transactions
(defined below). The Preferred Stock will be mandatorily convertible into shares of the Company’s common stock, par value
$.001 per share (the “Common Stock”), subject to and in accordance with the terms and conditions of the Preferred
Stock Designation.

The Purchasers will
receive, on a pro rata basis, warrants, in substantially the form set forth in Exhibit B (the “Warrants”)
to acquire up to that number of shares of Common Stock equal to 100% of the number of shares of Common Stock issuable upon conversion
of the Preferred Shares (defined below), rounded to the nearest whole share of Common Stock for each Purchaser. The Warrants issuable
to each Purchaser will be split evenly into two tranches, with one tranche subject to mandatory exercise upon the occurrence of
certain events described therein.

The shares of Preferred
Stock to be sold in the Private Placement are collectively referred to as the “Preferred Shares.” The shares
of Common Stock into which the Preferred Shares are to be convertible are referred to as the “Conversion Shares.”
The shares of Common Stock issuable upon exercise of or otherwise pursuant to the Warrants are referred to as the “Warrant
Shares.” Collectively, the Preferred Shares, the Conversion Shares, and the Warrant Shares are referred to as the “Securities.”
The conversion of the Preferred Stock into Common Stock is referred to herein as the “Conversion”.

The Securities will
be offered and sold to the Purchasers in the private placement without being registered under the Securities Act of 1933, as amended,
and the rules and regulations of the Securities and Exchange Commission (the “Commission”) thereunder (collectively,
the “Securities Act”), in reliance upon Section 4(a)(2) (“Section 4(a)(2)”) thereof and/or
Regulation D (“Regulation D”) thereunder or Regulation S (“Regulation S”) thereunder. The
Company has engaged SunTrust Robinson Humphrey to act as exclusive placement agent (the “Placement Agent”) for
the offering of the Securities on a “best efforts” basis.

Holders of the Securities
will be entitled to the benefits of a Resale Registration Rights Agreement (the “Resale Registration Rights Agreement”)
to be entered into between the Company and the Purchasers pursuant to which the Company will agree, among other things, to file
with the Commission a shelf registration statement pursuant to Rule 415 under the Securities Act (the “Resale Registration
Statement”) covering the resale of the Conversion Shares and the Warrant Shares, and to use its commercially
reasonable efforts to cause the Resale Registration Statement to be declared effective within the time periods specified in the
Resale Registration Rights Agreement.

The number of Preferred
Shares to be purchased by each Purchaser hereunder is set forth on such Purchaser’s signature page. Each of the Purchasers
is acting separately.

This Agreement, the
Preferred Stock Designation, the form of Warrant, and the Resale Registration Rights Agreement are referred to herein collectively
as the “Transaction Documents,” and the transactions contemplated hereby and thereby are referred to herein
collectively as the “Transactions.”

The Company hereby
confirms its agreement with each Purchaser as follows:

Section 1. Purchase
and Sale of Securities.

(a)               
Closing; Closing Date. Subject to the satisfaction or, where possible, waiver of the conditions set forth in Sections
5 and 6, at the closing (the “Closing”), the Company shall issue and sell to the Purchasers, and
each Purchaser severally agrees to purchase from the Company on the Closing Date (as defined below), the amount of Preferred Shares
and Warrants set forth on such Purchaser’s signature page to this Agreement. The date and time of the Closing (the “Closing
Date”) shall be 10:00 a.m., New York City time, on a date as soon as practicable after the date hereof and as mutually
agreed to by the Company and the Purchasers, but in no event later than the tenth business day following the date of this Agreement;
provided, however, that if the Closing has not taken place on the Closing Date because of a failure to satisfy one
or more of the conditions specified in Sections 5 or 6, “Closing Date” shall mean 10:00 a.m.,
New York City Time, on the first business day following satisfaction or waiver of all such conditions) after notification of satisfaction
or waiver of the conditions to the Closing set forth in Sections 5 and 6. The Closing shall take place
at the offices of Jones Day, Atlanta, Georgia.

(b)              
Form of Payment. Except as may otherwise be agreed to among the Company and one or more of the Purchasers, on or
prior to 12:00 p.m., New York City time, on the Closing Date, (i) each Purchaser shall wire its Investment Amount (as set forth
on, and as defined in, each Purchaser’s signature page to this Agreement), in U.S. dollars and in immediately available funds,
to the Company pursuant to the wire instructions set forth in Schedule 1; (ii) the Company shall irrevocably instruct the
Transfer Agent to deliver to each Purchaser (pursuant to instructions set forth in the Investor Questionnaire attached as Exhibit
C) one or more stock certificates, free and clear of all restrictive legends (except as expressly provided in this Agreement),
evidencing the number of Preferred Shares such Purchaser is purchasing as is set forth on such Purchaser’s signature page
to this Agreement next to the heading “Number of Securities to be Acquired,” within one business day after the Closing;
and (iii) the Company shall deliver to each Purchaser (pursuant to instructions set forth in the Investor Questionnaire attached
as Exhibit C) two or more Warrants (divided equally by Warrant Shares among two tranches, one tranche subject to mandatory
exercise upon the occurrence of certain events described therein), free and clear of all restrictive legends (except as expressly
provided in this Agreement), exercisable for that number of Warrant Shares equal to 100% of the number of Conversion Shares issuable
to such Purchaser upon Conversion of such Purchaser’s Preferred Shares on the Closing Date, rounded to the nearest whole
share of Common Stock.

Section 2. Representations
and Warranties of Each Purchaser.

Each Purchaser, for
itself and for no other Purchaser, represents and warrants as of the date hereof and as of the Closing Date to the Company and
the Placement Agent as follows:

(a)               
Private Placement; Reliance on Exemptions. Such Purchaser understands that the Securities are being offered and sold
to it in reliance on Section 4(a)(2), Regulation D or Regulation S under the Securities Act from the registration requirements
of U.S. federal and state securities laws and that the Company is relying in part upon the truth and accuracy of, and such Purchaser’s
compliance with, the representations, warranties, agreements, acknowledgments and understandings of such Purchaser set forth herein
in order to determine the availability of such exemptions and the eligibility of such Purchaser to acquire the Securities.

(b)              
Purchaser Status. Each of the Purchasers acknowledges that (i) (A) it is an institutional “accredited investor”
as defined in Rule 501(a)(1), (2), (3) or (7) of Regulation D under the Securities Act and/or meets the definition of “qualified
institutional buyers” as defined in Rule 144A(a)(1) under the Securities Act and (B) is not an entity formed for the sole
purpose of acquiring the Securities; or (ii) it is not purchasing the Securities as a result of any “directed selling efforts,”
within the meaning of Rule 902(k) of Regulation S and that such Purchaser is not a “U.S. Person,” within the meaning
of Rule 902(k) of Regulation S and it is purchasing the Securities pursuant to an offshore transaction, as such terms are used
in Regulation S.

(c)               
No Public Sale or Distribution. Such Purchaser is acquiring the Securities for its own account and not with a view
toward, or for resale in connection with, the public sale or distribution thereof in a manner that would violate the Securities
Act; provided, however, that by making the representations herein, such Purchaser does not agree to hold any of the Securities
for any minimum or other specific term and reserves the right to dispose of the Securities at any time in accordance with or pursuant
to a registration statement or an exemption under the Securities Act. Such Purchaser is acquiring the Securities hereunder in the
ordinary course of its business. Such Purchaser does not presently have any agreement or understanding, directly or indirectly,
with any Person to distribute any of the Securities. As used in this Agreement, “Person” means an individual,
a limited liability company, a partnership, a joint venture, a corporation, a trust, an unincorporated organization and a government
or any department or agency thereof.

(d)              
Independent Evaluation. Such Purchaser confirms and agrees that (i) it has independently evaluated the merits of
its decision to purchase the Securities; (ii) such Purchaser and its advisors, if any, have been afforded the opportunity to ask
questions of and receive answers from the Company; with the understanding that neither such inquiries nor any other due diligence
investigations conducted by such Purchaser or its advisors, if any, or its representatives shall modify, amend or affect such Purchaser’s
right to rely on the Company’s representations and warranties contained herein; (iii) its investment in the Securities involves
a high degree of risk and it is able to bear the economic risk of such investment; (iv) it has sufficient knowledge and experience
in financial and business matters as to be capable of evaluating the merits and risks of its investment in the Securities and has
sought such accounting, legal and tax advice as it has considered necessary to make an informed investment decision with respect
to its acquisition of the Securities; (v) it has not relied on the advice of, or any representations by, the Placement Agent or
any affiliate thereof or any representative of the Placement Agent or its affiliates in making such decision; and (vi) neither
the Placement Agent nor any of its representatives has any responsibility with respect to the completeness or accuracy of any information
or materials furnished to such Purchaser in connection with the Transactions.

(e)               
Legend(s). Such Purchaser understands that upon the original issuance thereof, and until such time as the same is
no longer required under applicable requirements of the Securities Act or applicable state securities laws, the certificates or
other instruments representing the Securities, and all certificates or other instruments issued in exchange therefor or in substitution
thereof, shall bear customary legend(s) referencing such restrictions on transferability, and that the Company will make a notation
on its records and give instructions to any transfer agent of the Common Stock in order to implement the restrictions on transfer
set forth and described herein.

(f)               
Organization; Authority. Such Purchaser is an entity duly organized, validly existing and in good standing under
the laws of the jurisdiction of its organization with the requisite power and authority to enter into and to consummate the transactions
contemplated by the Transaction Documents to which it is a party and otherwise to carry out its obligations hereunder and thereunder.

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

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

(i)                
No Governmental Review. Such Purchaser understands that no U.S. agency or any other government or governmental agency
has passed on or made any recommendation or endorsement of the Securities or the fairness or suitability of the investment in the
Securities nor have such authorities passed upon or endorsed the merits of the offering of the Securities.

(j)                
Transfer or Resale. Such Purchaser understands that: (i) the Securities have not been and will not be registered
under the Securities Act or any U.S. state or non-U.S. securities laws; (ii) such Purchaser agrees that if it decides to offer,
sell or otherwise transfer any of the Securities, such Securities may be offered, sold or otherwise transferred only: (A) pursuant
to an effective registration statement under the Securities Act; (B) to the Company; (C) outside the United States in accordance
with Regulation S under the Securities Act and in compliance with local laws; or (D) within the United States (1) in accordance
with the exemption from registration under the Securities Act provided by Rule 144A thereunder, if available, and in compliance
with any applicable state securities laws, or (2) in a transaction that does not require registration under the Securities Act
or applicable state securities laws.

(k)              
Filings. If required by applicable securities legislation, regulatory policy or order, or if required or requested
by any securities commission, stock exchange or other regulatory authority, at the request of and at the sole expense of the Company,
such Purchaser will use commercially reasonable efforts to execute, deliver and file and otherwise assist the Company in filing
reports, questionnaires, undertakings and other documents with respect to the issue of the Securities.

(l)                
Residency. For purposes of U.S. securities laws, such Purchaser is a resident of that jurisdiction specified on its
signature page to this Agreement.

(m)            
U.S. Federal Taxation. Such Purchaser acknowledges that it has sought advice concerning the tax aspects of and tax
considerations involved in acquiring and holding the Securities from an independent tax adviser that it has considered necessary
to make an informed investment decision with respect to the U.S. federal income tax consequences, as well as with respect to the
laws of any state, local or foreign jurisdiction that are applicable to such Purchaser, of owning and disposing of the Securities.

Section 3. Representations
and Warranties of the Company.

Except as otherwise
disclosed in the Exchange Act Documents (as defined below), the Company hereby represents and warrants as of the date hereof and
the Closing Date (except for the representations and warranties that speak as of a specific date, which are made as of such date),
to each of the Purchasers and the Placement Agent as follows:

(a)               
Exchange Act Compliance. The Company has filed with the Commission all documents (the “Exchange Act Documents”)
required since January 1, 2012 under the Securities Exchange Act of 1934, as amended, and the rules and regulations of the Commission
thereunder (collectively, the “Exchange Act”), and the Exchange Act Documents, at the time they were filed with
the Commission, complied in all material respects with the requirements of the Exchange Act. There are no contracts or other documents
required to be described in such Exchange Act Documents or to be filed as exhibits to such Exchange Act Documents that have not
been described or filed as required.

(b)              
The Transaction Documents. The Company has all necessary power and authority to execute and deliver the Transaction
Documents and to perform its obligations thereunder; each of the Transaction Documents has been duly authorized by the Company
and, when executed and delivered by the Company, will constitute a valid and binding agreement of the Company, enforceable against
the Company in accordance with its terms.

(c)               
The Securities. The Company has all necessary power and authority to issue and deliver the Preferred Shares; the
Preferred Shares have been duly authorized, and, when duly issued and delivered to Purchasers, will be duly and validly issued,
fully paid and nonassessable and will be issued in compliance with federal and state securities laws. The Company has all necessary
power and authority to execute, issue and deliver the Warrants; the Warrants have been duly authorized for issuance and sale by
the Company, will be in the form contemplated by the Transaction Documents and, when executed, countersigned and issued in accordance
with the terms of thereof and delivered to and paid for by the Purchasers pursuant to this Agreement, will constitute valid and
binding obligations of the Company, entitled to the benefits of the Transaction Documents, enforceable against the Company in accordance
with their terms. The Company has all necessary power and authority to issue and deliver the Conversion Shares and the Warrant
Shares; the Conversion Shares and the Warrant Shares have been duly reserved for issuance and have been duly authorized, and, when
duly issued and delivered to holders of the Preferred Shares or the Warrants upon Conversion or upon exercising of the Warrants
from time to time, respectively, the Conversion Shares and the Warrant Shares will be duly and validly issued, fully paid and nonassessable
and will be issued in compliance with federal and state securities laws. None of the Securities will be issued in violation of
any preemptive rights, rights of first refusal or other similar rights to subscribe for or purchase securities of the Company.

(d)              
No Applicable Registration or Other Similar Rights. There are no Persons with registration or other similar rights
to have any equity or debt securities of the Company or any affiliate (as defined in Rule 501(b) of Regulation D) registered for
sale under a registration statement, except for rights (i) contained in the Resale Registration Rights Agreement or (ii) as have
been duly waived.

(e)               
No Material Adverse Change. Since December 31, 2012: (i) there has been no material adverse change, or any development
that would reasonably be expected to result in a material adverse change, in the condition, financial or otherwise, or in the earnings,
business, operations or prospects, whether or not arising from transactions in the ordinary course of business, of the Company
and its subsidiary, considered as one entity (any such change, a “Material Adverse Change”); and (ii) the Company
and its subsidiary, considered as one entity, have not incurred any material liability or obligation (including any off-balance
sheet obligation), indirect, direct or contingent, not in the ordinary course of business nor entered into any material transaction
or agreement not in the ordinary course of business.

(f)               
Independent Accountants. UHY LLP, who have expressed their opinion with respect to the financial statements (which
term as used in this Agreement includes the related notes thereto) contained in the Exchange Act Documents, are (i) independent
public or certified public accountants as required by the Exchange Act, (ii) in compliance with the applicable requirements relating
to the qualification of accountants under Rule 2-01 of Regulation S-X and (iii) a registered public accounting firm as defined
by the Public Company Accounting Oversight Board.

(g)              
Preparation of the Financial Statements. As of the date hereof, the financial statements contained in the Exchange
Act Documents, present fairly in all material respects the consolidated financial position of the Company and its subsidiary as
of and at the dates indicated and the results of their operations and cash flows for the periods specified. Such financial statements
have been prepared in conformity in all material respects with generally accepted accounting principles as applied in the United
States applied on a consistent basis throughout the periods involved, except as may be expressly stated in the related notes thereto.
As of the date hereof, the financial data set forth in the Exchange Act Documents fairly present the information set forth therein
on a basis consistent with that of the audited financial statements contained in the Exchange Act Documents.

(h)              
Incorporation and Good Standing of the Company and its Subsidiary. Each of the Company and its subsidiary has been
duly incorporated and is validly existing as a corporation in good standing under the laws of the jurisdiction of its incorporation
and has the corporate power and authority to own, lease and operate its properties and to conduct its business as described in
the Exchange Act Documents as of their date, and, in the case of the Company, to enter into and perform its obligations under the
Transaction Documents. Each of the Company and its subsidiary is duly qualified as a foreign corporation to transact business and
is in good standing in each jurisdiction in which such qualification is required, whether by reason of the ownership or leasing
of property or the conduct of business, except where the failure to be so qualified would not, individually or in the aggregate,
have a material adverse effect on the financial position, stockholders’ equity, results of operations or business of the
Company (a “Material Adverse Effect”).

(i)                
Capital Stock Matters. Schedule 3(i) sets forth as of the date hereof: (1) the authorized, issued and
outstanding capital stock of the Company, (2) the shares of Common Stock issuable upon exercise of outstanding options, (3) the
shares of Common Stock issuable upon exercise of outstanding warrants or warrants the Company is contractually obligated to issue,
(4) the shares of Common Stock reserved pursuant to its stock option plan, and (5) the shares of Common Stock reserved pursuant
to other contractual obligations. All of the issued and outstanding shares of Common Stock have been duly authorized and validly
issued, are fully paid and nonassessable and have been issued in compliance with federal and state securities laws. None of the
outstanding shares of Common Stock were issued in violation of any preemptive rights, rights of first refusal or other similar
rights to subscribe for or purchase securities of the Company. There are no authorized or outstanding options, warrants, preemptive
rights, rights of first refusal or other rights to purchase, or equity or debt securities convertible into or exchangeable or exercisable
for, any capital stock of the Company or its subsidiary other than those described in Schedule 3(i). As of the date hereof
and as of the Closing Date, the description of the Company’s stock option, stock bonus and other stock plans or arrangements,
and the options or other rights granted thereunder, as set forth in the Exchange Act Documents constitutes and will constitute
an accurate summary of the material terms and related issuances with respect to such plans, arrangements, options and rights.

(j)                
Exchange Act Registration; No Shell-Company Status. The shares of Common Stock are registered pursuant to Section
12(g) of the Exchange Act, and the Company has taken no action designed to, or likely to have the effect of, terminating the registration
of the shares of Common Stock under the Exchange Act, nor has the Company received any notification that the Commission is contemplating
terminating such registration. The Company is not, and has never been, a “shell company” for purposes of Rule 144(i)
of the Securities Act.

(k)              
Purchasers; Compliance With Rule 502(d). The Company will exercise reasonable care to assure that the Purchasers
are not “underwriters” within the meaning of Section 2(a)(11) of the Securities Act and, without limiting the foregoing,
that such purchases will comply with Rule 502(d) under the Securities Act.

(l)                
Compliance with Laws. The Company has not been advised, and has no reason to believe, that it and its subsidiary
are not conducting business in compliance with all applicable laws, rules and regulations of the jurisdictions in which it is conducting
business, except where failure to be so in compliance would not result in a Material Adverse Change.

(m)            
No Violation or Default. The Company and its subsidiary are not in, and the execution, delivery and performance of
the Transaction Documents by the Company and the consummation by the Company of the Transactions will not result in a, (i) violation
of any term of or in default under its certificate of incorporation, bylaws or other organizational document, (ii) violation of
any judgment, decree or order or any law, statute, ordinance, rule or regulation (including federal U.S. and state and non-U.S.
securities laws) applicable to the Company and its subsidiary, and the Company and its subsidiary will not conduct their business
in violation of any of the foregoing, and (iii) in default, and no event has occurred that, with notice or lapse of time or both,
would constitute such a default, in the due performance or observance of any material term, covenant or condition contained in,
or give to others any rights of termination, amendment, acceleration or cancellation of, any indenture, mortgage, deed of trust,
loan agreement or other agreement or instrument to which the Company or its subsidiary is a party or by which the Company or its
subsidiary are bound or to which any of the property or assets of the Company or its subsidiary is subject, except, in the case
of clauses (ii) and (iii), for such violations as would not be reasonably expected to have a Material Adverse Effect.

(n)              
Consents. Other than (1) the filing of a Form D with respect to the Securities as required under Regulation D, (2)
such filings required under applicable securities or Blue Sky laws of the states of the United States, and (3) such filings contemplated
by the Resale Registration Rights Agreement (all of the foregoing, the “Required Approvals”), the Company and
its subsidiary are not required to obtain any consent, approval, authorization or order of, or make any filing or registration
with, any court, governmental agency or any regulatory or self-regulatory agency or any other Person in order for the Company to
execute, deliver or perform any of its obligations under or contemplated by the Transaction Documents, in each case, in accordance
with the terms hereof or thereof or to consummate the Transactions.

(o)              
No Directed Selling Efforts. None of the Company, its affiliates nor any Person acting on its or their behalf (other
than the Placement Agent in connection with this Agreement) has engaged or will engage in any directed selling efforts (as that
term is defined in Regulation S) with respect to the Securities and each of the Company, its affiliates and any Person acting on
its or their behalf (other than the Placement Agent in connection with this Agreement) has complied and will comply with the offering
restrictions requirement of Regulation S.

(p)              
No Registration. Assuming the accuracy of the representations and warranties of the Purchaser contained in Section
2 and each Purchaser’s compliance with their agreements set forth in the Transaction Documents, it is not necessary in
connection with the offer, issuance, sale and delivery of the Securities in the manner contemplated by this Agreement and the other
Transaction Documents to register the offer or sale of any of the Securities under the Securities Act.

(q)              
No General Solicitation. Neither the Company, nor any of its affiliates, nor any Person acting on its behalf, has
engaged in any form of general solicitation or general advertising (within the meaning of Regulation D) in connection with the
offer or sale of the Securities.

(r)                
No Integrated Offering. Neither the Company, nor any of its affiliates, or any Person acting on its behalf, has,
directly or indirectly, made any offers or sales of any security or solicited any offers to buy any security, under circumstances
that would require registration of any of the Securities under the Securities Act or cause this offering of the Securities to be
integrated with prior offerings by the Company for purposes of the Securities Act. None of the Company, its affiliates, or any
Person acting on its behalf, will take any action or steps referred to in the preceding sentence that would require registration
of the offer, issuance or sale of any of the Securities under the Securities Act or cause the offering of the Securities to be
integrated with other offerings.

(s)               
No Offer and Sale Within Six Months. The Company has not sold or issued any security of the same or similar class
or series as any of the Securities or any security convertible into any of the Securities during the six-month period preceding
the earlier of the date of this Agreement and the Closing Date, including any sales pursuant to Rule 144A or Regulation D (other
than shares issued pursuant to employee or director benefit plans, qualified stock options plans, for other employee or director
compensation purposes, or pursuant to outstanding options, rights or warrants), and has no intention of making, and will not make,
an offer or sale of such securities, for a period of six months after the date of this Agreement, except for the offering of Securities
as contemplated by this Agreement and the Resale Registration Rights Agreement. As used in this paragraph, the terms “offer”
and “sale” have the meanings specified in Section 2(a)(3) of the Securities Act.

(t)                
QIBs; Accredited Investor or Non-U.S. Person. The Company will not offer or sell any of the Securities to any Person
whom it reasonably believes is not (i) a “qualified institutional buyer” as defined in Rule 144A; (ii) an institutional
“accredited investor” (as defined in clauses (1), (2), (3) and (7) of Rule 501(a) of Regulation D); or (iii) a non-U.S.
Person as defined under Regulation S of the Securities Act.

(u)              
All Necessary Permits, etc. The Company and its subsidiary each possess such valid and current certificates, authorizations
or permits issued by the appropriate state, federal or other applicable regulatory agencies or bodies necessary to conduct their
respective businesses, and neither the Company nor its subsidiary has received any notice of proceedings relating to the revocation
or modification of, or non-compliance with, any such certificate, authorization or permit that, singly or in the aggregate, if
the subject of an unfavorable decision, ruling or finding, would result in a Material Adverse Change.

(v)              
Intellectual Property Rights. The Company and its subsidiary own or possess sufficient trademarks, service marks,
trade names, patents, patent rights, copyrights, domain names, licenses, approvals, trade secrets, inventions, know-how (including
unpatented and/or unpatentable proprietary or confidential information, systems or procedures), licenses and other similar rights
(collectively, “Intellectual Property Rights”) reasonably necessary to conduct their businesses as now conducted.
Neither the Company nor its subsidiary has received any notice of infringement or conflict with asserted Intellectual Property
Rights of others. As of the date hereof and as of the Closing Date, the Company is not and will not be a party to or bound by any
material options, licenses or agreements with respect to the Intellectual Property Rights of any other Person except as described
in the Exchange Act Documents or as will be described in the Exchange Act Documents. None of the technology employed by the Company
has been obtained or is being used by the Company in violation of any contractual obligation binding on the Company or, to the
Company’s knowledge, any of its officers, directors or employees or otherwise in violation of the rights of any Persons.

(w)            
Absence of Litigation. There is no action, suit, proceeding, inquiry or investigation before or by any court, government
agency, self-regulatory organization or body pending or, to the best knowledge of the Company, (i) threatened against or affecting
the Company, its subsidiary, or any of the officers or directors of the Company or its subsidiary in their capacities as such or
(ii) that questions the validity of the Transaction Documents or the right of the Company to enter into or perform the Transaction
Documents, nor is there any litigation pending or, to the Company's knowledge, threat thereof, against the Company or its subsidiary
by reason of the activities presently conducted or proposed to be conducted by the Company or its subsidiary, nor, to the Company’s
knowledge, is there any basis therefor.

(x)              
Insurance. Each of the Company and its subsidiary are insured by recognized, financially sound and reputable institutions
with policies in such amounts and with such deductibles and covering such risks as are generally deemed adequate and customary
for their businesses including, but not limited to, policies covering real and personal property owned or leased by the Company
and its subsidiary against theft, damage, destruction, acts of vandalism and earthquakes. The Company has no reason to believe
that it or its subsidiary will not be able (i) to renew its existing insurance coverage as and when such policies expire or (ii)
to obtain comparable coverage from similar institutions as may be necessary or appropriate to conduct its business as now conducted
and at a cost that would not result in a Material Adverse Change. Neither of the Company nor its subsidiary has been denied any
insurance coverage which it has sought or for which it has applied.

(y)              
Tax Law Compliance. The Company and its consolidated subsidiary have filed all necessary federal and state income
and franchise tax returns or have properly requested extensions thereof and have paid all taxes required to be paid by any of them
and, if due and payable, any related or similar assessment, fine or penalty levied against any of them except as may be being contested
in good faith and by appropriate proceedings. The Company has made adequate charges, accruals and reserves in the applicable financial
statements referred to in Section 3(g) in respect of all federal and state and income and franchise taxes for all periods
as to which the tax liability of the Company or its consolidated subsidiary has not been finally determined.

(z)               
Company Not an “Investment Company.” The Company is not, and after receipt of payment for the Securities
will not be, an “investment company” within the meaning of the Investment Company Act of 1940, as amended, and the
rules and regulations of the Commission thereunder (collectively, the “Investment Company Act”) and will conduct
its business in a manner so that it will not become subject to the Investment Company Act.

(aa)           
Brokers. Except for the Placement Agent, there is no broker, finder or other party that is entitled to receive from
the Company any brokerage or finder’s fee or other fee or commission as a result of the Transactions.

Section 4. Covenants.

(a)               
Reasonable Best Efforts. Each party shall use its reasonable best efforts to timely satisfy each of the conditions
to be satisfied by it as provided in Sections 5 and 6 of this Agreement.

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

(c)               
Securities Laws Disclosure; Publicity. No later than
9:30 a.m., New York City time, on the first business day after the date of this Agreement, the Company shall issue a press release
(the “Press Release”) in a form reasonably acceptable
to the Placement Agent disclosing all material terms of the Transactions. On or before 5:30 p.m., New York City time, on the fourth
business day immediately following the execution of this Agreement, the Company will file a current report on Form 8-K with the
Commission describing the terms of the Transaction Documents (and including as exhibits to such current report on Form 8-K the
Transaction Documents). Notwithstanding the foregoing, the Company shall not publicly disclose the name of any Purchaser or an
Affiliate of any Purchaser, or include the name of any Purchaser or an Affiliate of any Purchaser in any press release or filing
with the Commission (other than the Registration Statement) or any regulatory agency, without the prior written consent of such
Purchaser, except (1) as required by federal securities law in connection with (A) any registration statement contemplated
by the Resale Registration Rights Agreement and (B) the filing of final Transaction Documents (including signature pages thereto)
with the Commission and (2) to the extent such disclosure is required by law or request of the Staff of the Commission, in
which case the Company shall provide the Purchasers with prior written notice of such disclosure permitted under this subclause
(2). From and after the issuance of the Press Release, no Purchaser shall be in possession of any material, non-public information
received from the Company or any of its officers, directors, employees or agents, that is not disclosed in the Press Release, unless
a Purchaser shall have executed a written agreement regarding the confidentiality and use of such information. Each Purchaser,
severally and not jointly with the other Purchasers, covenants that it will comply with the provisions of any confidentiality or
nondisclosure agreement executed by it and, in addition, until such time as the transactions contemplated by this Agreement are
required to be publicly disclosed by the Company as described in this Section 4(c), such Purchaser will maintain the confidentiality
of all disclosures made to it in connection with this transaction (including the existence and terms of this transaction). 

(d)              
Fees and Expenses. Each party to this Agreement shall bear its own expenses in connection with the offer and sale
of the Securities to the Purchasers. The Company shall pay the fees of its transfer agent in connection with the offer and sale
of the Securities to the Purchasers.

(e)               
Financial Information. For so long as any Securities remain outstanding, the Company will make available to the Purchasers
and any holder of Securities in connection with any sale thereof and any prospective purchaser of Securities, in each case upon
request, the information specified in, and meeting the requirements of, Regulation D under the Securities Act (or any successor
thereto).

(f)               
Reporting Status. During the period beginning on the Closing Date and ending on the earlier of the second anniversary
of the Closing Date and the date none of the Securities remain outstanding, the Company shall timely file all reports required
to be filed with the Commission pursuant to the Exchange Act, and the Company shall not terminate its status as an issuer required
to file reports under the Exchange Act even if the Exchange Act or the rules and regulations thereunder would no longer require
or otherwise permit such termination.

(g)              
Reservation of Shares. The Company shall take all action necessary to at all times have authorized, and reserved
for the purpose of issuance, free of pre-emptive rights, after the Closing Date, a number of shares of Common Stock sufficient
for the purpose of enabling the Company to issue the Conversion Shares upon the Conversion and the Warrant Shares upon exercise
of the Warrants.

(h)              
Issuance Limitation. During the period beginning on the date of this Agreement and ending on the 30th day following
the Effective Date (as defined in the Resale Registration Rights Agreement), the Company shall not issue, sell or exchange, or
agree or obligate itself to issue, sell or exchange or reserve, agree to or set aside for issuance, sale or exchange, (1) any shares
of Common Stock, (2) any other equity security of the Company, including, without limitation, shares of preferred stock, (3) any
other security of the Company which by its terms is convertible into or exchangeable or exercisable for any equity security of
the Company, or (4) any option, warrant or other right to subscribe for, purchase or otherwise acquire any such security described
in the foregoing clauses (1) through (3); provided, however, that the foregoing shall not apply to any issuance of
shares of Common Stock or Common Stock equivalents (A) upon the exercise of any options or warrants outstanding, (B) upon the exercise
of any Warrants or upon the Conversion, or (C) to employees, directors, or consultants pursuant to any stock option or equity incentive
plan or other compensation plan, program, agreement or arrangement as long as, in the case of clauses (A) and (C), the terms of
any such options, warrants, plan, programs, agreements, or arrangements are not materially amended.

Section 5. Conditions
to the Company’s Obligation to Sell.

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

(a)               
Each Purchaser shall have executed each of the Transaction Documents to which it is a party and delivered the same to the
Company, and shall have delivered to the Company a fully completed and executed Investor Questionnaire, satisfactory to the Company,
in the form attached as Exhibit C to this Agreement and Selling Stockholder Questionnaire, satisfactory to the Company,
in the form attached as Annex B to the Registration Rights Agreement.

(b)              
Each Purchaser shall have delivered to the Company such Purchaser’s Investment Amount no later than 12:00 p.m. New
York City time on the Closing Date by wire transfer of immediately available funds pursuant to the wire instructions set forth
on Schedule 1 hereto.

(c)               
The representations and warranties of each Purchaser contained herein shall be true and correct as of the date when made
and as of the Closing Date as though made at that time and such Purchaser shall have performed, satisfied and complied in all material
respects with the covenants, agreements and conditions required by the Transaction Documents to be performed, satisfied or complied
with by such Purchaser, as applicable, at or prior to the Closing Date.

(d)              
No injunction, restraining order, action or order of any nature by a governmental or regulatory authority shall have been
issued, taken or made or no action shall have been taken and no statute, rule, regulation or order shall have been enacted, adopted
or issued by any federal, state or foreign governmental or regulatory authority of competent jurisdiction that would, prior to
or as of the Closing Date, prevent or materially interfere with the consummation of the Transactions.

Section 6. Conditions
to the Purchasers’ Obligation to Purchase.

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

(a)               
The Company shall have executed and delivered, or caused to be delivered, to each Purchaser (i) each of the Transaction
Documents to which it is a party; (ii) pursuant to instructions set forth in the Investor Questionnaire attached as Exhibit
C, facsimile copies of one or more stock certificates, free and clear of all restrictive legends except as provided for in
this Agreement, evidencing the number of Preferred Shares such Purchaser is purchasing as is set forth on such Purchaser’s
signature page to this Agreement next to the heading “Number of Preferred Shares to be Acquired,” with the original
stock certificates delivered by the Company’s transfer agent within one business day after the Closing; and (iii) and
two or more Warrants exercisable, in the aggregate, for that number of Warrant Shares equal to 100% of the number of Conversion
Shares issuable to such Purchaser upon Conversion of such Purchaser’s Preferred Shares on the Closing Date (divided equally
by Warrant Shares among two tranches, one tranche subject to mandatory exercise upon the occurrence of certain events described
therein), rounded to the nearest whole share of Common Stock.

(b)              
The representations and warranties of the Company contained herein shall be true and correct as of the date when made and
as of the Closing Date as though made at that time (except for representations and warranties that speak as of a specific date,
which shall have been true and correct as of such date) and the Company shall have performed, satisfied and complied in all material
respects with the covenants, agreements and conditions required by the Transaction Documents to be performed, satisfied or complied
with by the Company, as applicable, at or prior to the Closing Date. Each Purchaser or its agent shall have received a certificate,
executed by an authorized officer of the Company, dated as of the Closing Date, to the foregoing effect.

(c)               
No injunction, restraining order, action or order of any nature by a governmental or regulatory authority shall have been
issued, taken or made or no action shall have been taken and no statute, rule, regulation or order shall have been enacted, adopted
or issued by any federal, state or foreign governmental or regulatory authority of competent jurisdiction that would, prior to
or as of the Closing Date, prevent or materially interfere with the consummation of the Transactions; and no stop order suspending
the qualification or exemption from qualification of any of the Securities in any jurisdiction shall have been issued and no proceeding
for that purpose shall have been commenced or, to the knowledge of the Company, be pending or contemplated as of the Closing Date.

(d)              
The Company shall not have received any material non-public communications (verbal or written) from the U.S. Food and Drug
Administration pertaining to the regulatory review of the LuViva product for cervical cancer.

(e)               
There shall not have occurred any event or condition which has had, or would reasonably be expected to have, a material
adverse effect on the Company’s business, financial condition, results of operations, assets, liabilities or prospects, in
each case taken as a whole.

(f)               
Each Purchaser or its agent shall have received an opinion of Jones Day, counsel to the Company, dated the Closing Date,
addressed to each such Purchaser, in substantially the form attached hereto as Exhibit D, and the Placement Agent shall
have received a customary reliance letter with regard to such opinion.

(g)              
The Company shall have delivered duly executed irrevocable transfer agent instructions acknowledged in writing by the Company’s
transfer agent instructing the transfer agent to deliver the certificates referred to in Section 6(a).

(h)              
The Company shall have delivered to each Purchaser a Secretary’s certificate certifying to (i) the formation and good
standing of the Company in its jurisdiction of organization; (ii) qualification by such entity as a foreign corporation and good
standing issued by the Secretary of State of the State of Georgia as of a date within 30 days of the Closing Date; and (iii) (a)
the resolutions as adopted by the Company’s Board of Directors authorizing the Transaction Documents and the Transactions,
and (b) the accuracy of attached copies of the certificate of incorporation and bylaws of the Company and such other matters as
reasonably requested by the Purchasers and as are customary for similar transactions.

Section 7. Termination;
Survival. This Agreement may be terminated and the sale and purchase of the Securities abandoned
at any time prior to the Closing by either the Company or any Purchaser (with respect to itself only) upon written notice to the
other, if the Closing has not been consummated on or prior to 5:00 p.m., New York City time, on the 11th business day
after the date of this Agreement; provided, however, that the right to terminate this Agreement under this Section
7(a) shall not be available to any party whose failure to comply with its obligations under this Agreement has been the cause
of or resulted in the failure of the Closing to occur on or before such time. Nothing in this Section 7(a) shall be deemed
to release any party from any liability for any breach by such party of the terms and provisions of the Transaction Documents or
to impair the right of any party to compel specific performance by any other party of its obligations under the Transaction Documents.
In the event of a termination pursuant to this Section 7(a), the Company shall promptly notify all non-terminating Purchasers.
Upon a termination in accordance with this Section 7(a), the Company and the non-terminating Purchaser(s) shall not have
any further obligation or liability (including arising from such termination) to the other, and no Purchaser will have any liability
to any other Purchaser under the Transaction Documents as a result therefrom. 

Section 8. Indemnification.

(a)               
In consideration of each Purchaser’s execution and delivery of the Transaction Documents and acquiring the Securities
thereunder and in addition to all of the other obligations of the Company under the Transaction Documents, the Company shall defend,
protect, indemnify and hold harmless each Purchaser and such Purchasers’ stockholders, partners, members, officers, directors,
employees and direct or indirect investors and any of the foregoing Persons’ agents or other representatives (including,
without limitation, those retained in connection with the transactions contemplated by this Agreement) (each, an “Indemnitee”
and collectively, the “Indemnitees”), as incurred, from and against any and all actions, causes of action, suits,
claims, losses, costs, penalties, fees, liabilities and damages, and expenses in connection therewith (irrespective of whether
any such Indemnitee is a party to the action for which indemnification hereunder is sought), and including reasonable attorneys’
fees and disbursements (the “Indemnified Liabilities”), incurred by any Indemnitee as a result of, or arising
out of, or relating to the execution, delivery, performance or enforcement of the Transaction Documents or any other certificate,
instrument or document contemplated hereby or thereby. To the extent that the foregoing undertaking by each of the Company may
be unenforceable for any reason, the Company shall make the maximum contribution to the payment and satisfaction of each of the
Indemnified Liabilities which is permissible under applicable law. If a third party claim in respect of Indemnified Liabilities
involves more than one Indemnitee, the Indemnitees shall conduct the defense through the same legal counsel, at indemnitor’s
expense, acceptable to all Indemnitees, provided that an Indemnitee may employ separate counsel, at indemnitor’s expense,
if representation by the same legal counsel would be inappropriate due to differing interests between the Indemnitees.

Section 9. Miscellaneous.

(a)               
Notices. Any notice or other communication required or permitted to be provided hereunder shall be in writing and
shall be delivered in Person or by first class mail (registered or certified, return receipt requested), facsimile, or overnight
air courier guaranteeing next day delivery. The address for such notices and communications shall be as follows:

If to the Company:

5835 Peachtree Corners East, Suite D

Atlanta, Georgia 30092

Attn: Chief Executive Officer

Facsimile: 770-242-8639

With a copy to:

Jones Day

1420 Peachtree Street, N.E.

Suite 800

Atlanta, Georgia 30309

Attn: John E. Zamer

Facsimile: 404-581-8330

If to a Purchaser:

To the address set forth under such Purchaser’s
name on its signature page to this Agreement, or such other address as may be designated in writing hereafter by such Purchaser.

All notices and communications
shall be deemed to have been duly given: at the time delivered by hand, if personally delivered; five business days after being
deposited in the mail, postage prepaid, if mailed; when receipt acknowledged, if telecopied; and the next business day after timely
delivery to the courier, if sent by overnight air courier guaranteeing next day delivery. Failure to provide a notice or communication
to one party hereto or any defect in it shall not affect its sufficiency with respect to other parties hereto.

(b)              
Adjustments in Securities Numbers and Prices. In the event of any stock split, subdivision, dividend or distribution
payable in shares of Common Stock (or other securities or rights convertible into, or entitling the holder thereof to receive directly
or indirectly shares of Common Stock), combination or other similar recapitalization or event occurring after the date hereof and
prior to the Closing, each reference in any Transaction Document to a number of Securities or a price per Security shall be deemed
to be amended to appropriately account for such event. The Company shall give to each Purchaser notice of any such event described
hereinabove within one (1) business day of its occurrence, or of any notice given or announcement in respect thereof.

(c)               
Independent Nature of Purchaser’s Obligations and Rights. The obligations of each Purchaser under this Agreement
are several and not joint with the obligations of each other Purchaser, and no Purchaser shall be responsible in any way for the
performance of the obligations of any other Purchaser under this Agreement. Nothing contained herein or in any Transaction Document,
and no action taken by any Purchaser pursuant thereto, shall be deemed to constitute the Purchaser as a partnership, an association,
a joint venture or any other kind of entity, or create a presumption that the Purchasers are in any way acting in concert or as
a group with respect to such obligations or the transactions contemplated by this Agreement or any other Transaction Document.
Each Purchaser acknowledges that no other Purchaser will be acting as agent of such Purchaser in enforcing its rights under this
Agreement. Each Purchaser shall be entitled to independently protect and enforce its rights, including without limitation the rights
arising out of this Agreement, and it shall not be necessary for any other Purchaser to be joined as an additional party in any
Proceeding for such purpose. The Company has elected to provide all Purchasers with the same terms and Transaction Documents for
the convenience of the Company and not because it was required or requested to do so by any Purchaser.

(d)              
Governing Law; Jurisdiction; Jury Trial; Etc. This Agreement shall be governed by, and construed in accordance with,
the laws of the State of New York. Each party hereby irrevocably submits to the exclusive jurisdiction of the state and federal
courts sitting in The City of New York, Borough of Manhattan, for the adjudication of any dispute hereunder or in connection herewith
or with any transaction contemplated hereby or discussed herein, and hereby irrevocably waives, and agrees not to assert in any
suit, action or proceeding, any claim that it is not personally subject to the jurisdiction of any such court, that such suit,
action or proceeding is brought in an inconvenient forum or that the venue of such suit, action or proceeding is improper. Each
party hereby irrevocably waives personal service of process and consents to process being served in any such suit, action or proceeding
by mailing a copy thereof to such party at the address for such notices to it under this Agreement and agrees that such service
shall constitute good and sufficient service of process and notice thereof. Nothing contained herein shall be deemed to limit in
any way any right to serve process in any manner permitted by law. Each party hereby irrevocably waives any right it may have,
and agrees not to request, a jury trial for the adjudication of any dispute hereunder or in connection with or arising out of this
Agreement or any transaction contemplated hereby. If either party shall commence a proceeding to enforce any provisions of
this Agreement, then the prevailing party in such proceeding shall be reimbursed by the other party for its attorney’s fees
and other costs and expenses incurred with the investigation, preparation and prosecution of such proceeding.

(e)               
Amendments and Waivers. No provision of this Agreement may be waived, modified, supplemented or amended except in
a written instrument signed, in the case of an amendment, by the Company and the Purchasers holding or having the right to acquire
66 2/3% of the Securities at the time of such amendment (which amendment shall be binding on all Purchasers or, in the case of
a waiver, by the party against whom enforcement of any such waiver is sought; provided, that any amendment, waiver modification
or supplement of this Agreement that modifies the Investment Amount of, or number of Securities to be acquired by, any Purchaser
may be effected only pursuant to a written instrument signed by the Company and such Purchaser. No waiver of any default with respect
to any provision, condition or requirement of this Agreement shall be deemed to be a continuing waiver in the future or a waiver
of any subsequent default or a waiver of any other provision, condition or requirement hereof, nor shall any delay or omission
of either party to exercise any right hereunder in any manner impair the exercise of any such right. No consideration shall be
offered or paid to any Purchaser to amend or consent to a waiver or modification of any provision of any Transaction Document unless
the same consideration is also offered to all Purchasers who then hold Securities.

(f)               
Entire Agreement. This Agreement supersedes all other prior oral or written agreements among the parties hereto and
Persons acting on their behalf with respect to the matters discussed herein, and this Agreement and the instruments referenced
herein contain the entire understanding of the parties with respect to the matters covered herein and therein and, except as specifically
set forth herein or therein, none of the parties hereto makes any representation, warranty, covenant or undertaking with respect
to such matters.

(g)              
Successors and Assigns. This Agreement binds and benefits the parties and their respective permitted successors and
assigns. This Section 9(g) does not address, directly or indirectly, whether a party may assign its rights or delegate its
performance under this Agreement.

(h)              
No Assignment; No Delegation. No party may assign any of its rights under this Agreement, except with the prior written
consent of the other parties, provided a Purchaser may assign without consent its rights to purchase Securities to an affiliate
or any Person that shares a common discretionary investment adviser with the Purchaser. All assignments of rights are prohibited
under this Agreement, whether they are voluntary or involuntary, by merger (regardless of whether the party is the surviving or
disappearing entity), consolidation, dissolution, operation of law, or any other manner. For purposes of this Section 9(h),
a “change of control” is deemed an assignment of rights. No party may delegate any performance under this Agreement.
Any purported assignment of rights or delegation of performance in violation of this Section 9(h) is void.

(i)                
Execution. This Agreement may be executed in any number of counterparts, each of which when so executed shall be
deemed to be an original and, all of which taken together shall constitute one and the same Agreement. In the event that any signature
is delivered by facsimile transmission, or by email delivery of a “.pdf” format data file, such signature shall create
a valid binding obligation of the party executing (or on whose behalf such signature is executed) the same with the same force
and effect as if such facsimile or digital signature were the original thereof.

(j)                
Severability. If any provision of this Agreement is determined to be invalid, illegal or unenforceable, the remaining
provisions of this Agreement remain in full force, if the essential terms and conditions of this Agreement for each party remain
valid, binding, and enforceable.

(k)              
No Construction Against the Drafter. Each party has participated in negotiating and drafting this Agreement, so if
an ambiguity or question of intent or interpretation arises, this Agreement is to be construed as if the parties had drafted it
jointly, as opposed to being construed against a party because it was responsible for drafting one or more provisions of this Agreement.

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

(m)            
No Third Party Beneficiaries. This Agreement is intended for the benefit of the parties hereto and their respective
permitted successors and assigns, and is not for the benefit of, nor may any provision hereof be enforced by, any other Person,
except that (i) the Placement Agent is an intended third party beneficiary of (A) the Purchasers’ representations and warranties
set forth in Section 2 and (B) the Company’s representations and warranties set forth in Section 3 and (ii) the Placement
Agent shall be entitled to rely upon the legal opinion identified in Section 6(f) pursuant to the reliance letter referenced in
Section 6(f).

[Signature Pages Follow]

    	 

    	 

    

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

 

	GUIDED THERAPEUTICS, INC.
	 
	 
	By:_/s/ Mark L. Faupel___________________
	Name: Mark L. Faupel, Ph.D.
	Title: President and Chief Executive Officer
	 
	 
	 
	 
	 
	 
	 
	 
	 

 

    	 

    	 

    

NAME OF PURCHASER:

Cranshire Capital Master Fund, Ltd. ___ _____

By: /s/ Keith A. Goodman

Name: Keith A. Goodman

Title: Authorized Signatory

Aggregate Purchase
Price (“Investment Amount”):

$200,000.24___________

Number of Preferred Shares to be Acquired:

200___________________

Warrants to be Acquired (number of Warrant Shares, to be split into two equal tranches):

294,118________________

Tax ID No.: ____________________

Address for Notice/Residency
of Purchaser:

__________________________________

__________________________________

__________________________________

Telephone No.: _______________________

Facsimile No.: ________________________

E-mail Address: ________________________

 

Attention: _______________________

Delivery Instructions:

(if different than above)

 

c/o _______________________________

 

Street: ____________________________

 

City/State/Zip: ______________________

 

Attention: __________________________

 

    	 

    	 

    

NAME OF PURCHASER:

Equitec Specialists, LLC ___ _____

By: /s/ Keith A. Goodman

Name: Keith A. Goodman

Title: Authorized Signatory

Aggregate Purchase
Price (“Investment Amount”):

$50,000.40 __________

Number of Preferred Shares to be Acquired:

50_ __________________

Warrants to be Acquired (number of Warrant Shares, to be split into two equal tranches):

73,530_________________

Tax ID No.: ____________________

Address for Notice/Residency
of Purchaser:

__________________________________

__________________________________

__________________________________

Telephone No.: _______________________

Facsimile No.: ________________________

E-mail Address: ________________________

 

Attention: _______________________

Delivery Instructions:

(if different than above)

 

c/o _______________________________

 

Street: ____________________________

 

City/State/Zip: ______________________

 

Attention: __________________________

    	 

    	 

    

NAME OF PURCHASER:

Ronald Hart ___ _____

By: /s/ Ronald Hart

Name: Ronald Hart

Title:

Aggregate Purchase
Price (“Investment Amount”):

$ 25,000.00 __________

Number of Preferred Shares to be Acquired:

25____________________

Warrants to be Acquired (number of Warrant Shares, to be split into two equal tranches):

36,765_________________

Tax ID No.: ____________________

Address for Notice/Residency
of Purchaser:

__________________________________

__________________________________

__________________________________

Telephone No.: _______________________

Facsimile No.: ________________________

E-mail Address: ________________________

 

Attention: _______________________

Delivery Instructions:

(if different than above)

 

c/o _______________________________

 

Street: ____________________________

 

City/State/Zip: ______________________

 

Attention: __________________________

    	 

    	 

    

NAME OF PURCHASER:

Capital Ventures International by Heights Capital Management its Authorized Agent ___ _____

By: /s/ Martin Kobinger 

Name: Martin Kobinger

Title: Investment Manager

Aggregate Purchase
Price (“Investment Amount”):

$300,000 __________

Number of Preferred Shares to be Acquired:

300______________________

Warrants to be Acquired (number of Warrant Shares, to be split into two equal tranches):

441,176_________________

Tax ID No.: ____________________

Address for Notice/Residency
of Purchaser:

__________________________________

__________________________________

__________________________________

Telephone No.: _______________________

Facsimile No.: ________________________

E-mail Address: ________________________

 

Attention: _______________________

Delivery Instructions:

(if different than above)

 

c/o _______________________________

 

Street: ____________________________

 

City/State/Zip: ______________________

 

Attention: __________________________

    	 

    	 

    

NAME OF PURCHASER:

John E. Imhoff ___ _____

By: /s/ John E. Imhoff

Name: John E. Imhoff

Title:

Aggregate Purchase
Price (“Investment Amount”):

$ 500,000.00 __________

Number of Preferred Shares to be Acquired:

500____________________

Warrants to be Acquired (number of Warrant Shares, to be split into two equal tranches):

735,294_________________

Tax ID No.: ____________________

Address for Notice/Residency
of Purchaser:

__________________________________

__________________________________

__________________________________

Telephone No.: _______________________

Facsimile No.: ________________________

E-mail Address: ________________________

 

Attention: _______________________

Delivery Instructions:

(if different than above)

 

c/o _______________________________

 

Street: ____________________________

 

City/State/Zip: ______________________

 

Attention: __________________________

    	 

    	 

    

NAME OF PURCHASER:

Lynne H. Imhoff ___ _____

By: /s/ Lynne H. Imhoff

Name: Lynne H. Imhoff

Title:

Aggregate Purchase
Price (“Investment Amount”):

$ 100,000.00 __________

Number of Preferred Shares to be Acquired:

100____________________

Warrants to be Acquired (number of Warrant Shares, to be split into two equal tranches):

147,059_________________

Tax ID No.: ____________________

Address for Notice/Residency
of Purchaser:

__________________________________

__________________________________

__________________________________

Telephone No.: _______________________

Facsimile No.: ________________________

E-mail Address: ________________________

 

Attention: _______________________

Delivery Instructions:

(if different than above)

 

c/o _______________________________

 

Street: ____________________________

 

City/State/Zip: ______________________

 

Attention: __________________________

 

    	 

    	 

    

NAME OF PURCHASER:

Alpha Capital Anstalt ___ _____

By: /s/ Konrad Ackermann

Name: Konrad Ackermann

Title: Director

Aggregate Purchase
Price (“Investment Amount”):

$ 500,000.00 __________

Number of Preferred Shares to be Acquired:

500____________________

Warrants to be Acquired (number of Warrant Shares, to be split into two equal tranches):

735,294_________________

Tax ID No.: ____________________

Address for Notice/Residency
of Purchaser:

__________________________________

__________________________________

__________________________________

Telephone No.: _______________________

Facsimile No.: ________________________

E-mail Address: ________________________

 

Attention: _______________________

Delivery Instructions:

(if different than above)

 

c/o _______________________________

 

Street: ____________________________

 

City/State/Zip: ______________________

 

Attention: __________________________

    	 

    	 

    

NAME OF PURCHASER:

Dolores Maloof ___ _____

By: /s/ Dolores Maloof

Name: Dolores Maloof

Title:

Aggregate Purchase
Price (“Investment Amount”):

$ 102,000.00 __________

Number of Preferred Shares to be Acquired:

102____________________

Warrants to be Acquired (number of Warrant Shares, to be split into two equal tranches):

150,000_________________

Tax ID No.: ____________________

Address for Notice/Residency
of Purchaser:

__________________________________

__________________________________

__________________________________

Telephone No.: _______________________

Facsimile No.: ________________________

E-mail Address: ________________________

 

Attention: _______________________

Delivery Instructions:

(if different than above)

 

c/o _______________________________

 

Street: ____________________________

 

City/State/Zip: ______________________

 

Attention: __________________________

 

    	 

    	 

    

NAME OF PURCHASER:

David B. Musket ___ _____

By: /s/ David B. Musket

Name: David B. Musket

Title:

Aggregate Purchase
Price (“Investment Amount”):

$ 450,000.00 __________

Number of Preferred Shares to be Acquired:

450 ___________________

Warrants to be Acquired (number of Warrant Shares, to be split into two equal tranches):

661,765_________________

Tax ID No.: ____________________

Address for Notice/Residency
of Purchaser:

__________________________________

__________________________________

__________________________________

Telephone No.: _______________________

Facsimile No.: ________________________

E-mail Address: ________________________

 

Attention: _______________________

Delivery Instructions:

(if different than above)

 

c/o _______________________________

 

Street: ____________________________

 

City/State/Zip: ______________________

 

Attention: __________________________

    	 

    	 

    

NAME OF PURCHASER:

Promed Partners, L.P. ___ _____

By: /s/ David B. Musket

Name: David B. Musket

Title: General Partner

Aggregate Purchase
Price (“Investment Amount”):

$ 150,000.00 __________

Number of Preferred Shares to be Acquired:

150 ___________________

Warrants to be Acquired (number of Warrant Shares, to be split into two equal tranches):

220,588_________________

Tax ID No.: ____________________

Address for Notice/Residency
of Purchaser:

__________________________________

__________________________________

__________________________________

Telephone No.: _______________________

Facsimile No.: ________________________

E-mail Address: ________________________

 

Attention: _______________________

Delivery Instructions:

(if different than above)

 

c/o _______________________________

 

Street: ____________________________

 

City/State/Zip: ______________________

 

Attention: __________________________

    	 

    	 

    

NAME OF PURCHASER:

The Whittemore Collection, Ltd. ___ _____

By: /s/ Stephen J. Suddney

Name: Stephen J. Suddney

Title: Vice President

Aggregate Purchase
Price (“Investment Amount”):

$ 100,000.00 __________

Number of Preferred Shares to be Acquired:

100 ___________________

Warrants to be Acquired (number of Warrant Shares, to be split into two equal tranches):

147,059_________________

Tax ID No.: ____________________

Address for Notice/Residency
of Purchaser:

__________________________________

__________________________________

__________________________________

Telephone No.: _______________________

Facsimile No.: ________________________

E-mail Address: ________________________

 

Attention: _______________________

Delivery Instructions:

(if different than above)

 

c/o _______________________________

 

Street: ____________________________

 

City/State/Zip: ______________________

 

Attention: ______________________

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