Document:

EXHIBIT 10.2

 

SECURITIES PURCHASE AGREEMENT

 

This SECURITIES PURCHASE
AGREEMENT (the “Agreement”), dated as of November 14 2014, by and between COATES INTERNATIONAL LTD., a Delaware
corporation, with headquarters located at Highway 34 & Ridgewood Road, Wall Township, New Jersey 07719 (the “Company”),
and AUCTUS PRIVATE EQUITY FUND, LLC, a Massachusetts limited liability company, with its address at 101 Arch Street, 20th
Floor, Boston, MA 02110 (the “Buyer”).

 

WHEREAS:

 

A.           The Company and the
Buyer are executing and delivering this Agreement in reliance upon the exemption from securities registration afforded by the rules
and regulations as promulgated by the United States Securities and Exchange Commission (the “SEC”) under the Securities
Act of 1933, as amended (the “1933 Act”);

 

B.           Buyer desires to
purchase and the Company desires to issue and sell, upon the terms and conditions set forth in this Agreement an 8% convertible
note of the Company, in the form attached hereto as Exhibit A, in the aggregate principal amount of US$40,000 (together with any
note(s) issued in replacement thereof or as a dividend thereon or otherwise with respect thereto in accordance with the terms thereof,
the “Note”), convertible into shares of common stock, $0.0001 par value per share, of the Company (the “Common
Stock”), upon the terms and subject to the limitations and conditions set forth in such Note.

 

C.           The Buyer wishes
to purchase, upon the terms and conditions stated in this Agreement, such principal amount of Note as is set forth immediately
below its name on the signature pages hereto; and

 

NOW THEREFORE, the
Company and the Buyer severally (and not jointly) hereby agree as follows:

 

1.            PURCHASE AND SALE
OF NOTE.

 

a.Purchase of Note.
On the Closing Date (as defined below), the Company shall issue and sell to the Buyer and the Buyer agrees to purchase from the
Company such principal amount of Note as is set forth immediately below the Buyer’s name on the signature pages hereto.

 

b.Form of Payment.
On the Closing Date (as defined below), (i) the Buyer shall pay the purchase price for the Note to be issued and sold to it at
the Closing (as defined below) (the “Purchase Price”) by wire transfer of immediately available funds to the Company,
in accordance with the Company’s written wiring instructions, against delivery of the Note in the principal amount equal
to the Purchase Price as is set forth immediately below the Buyer’s name on the signature pages hereto, and (ii) the
Company shall deliver such duly executed Note on behalf of the Company, to the Buyer, against delivery of such Purchase Price.

 

    	 

    	 

    

 

c.Closing Date.
Subject to the satisfaction (or written waiver) of the conditions thereto set forth in Section 7 and Section 8 below, the date
and time of the issuance and sale of the Note pursuant to this Agreement (the “Closing Date”) shall be 12:00 noon,
Eastern Standard Time on or about November 14, 2014, or such other mutually agreed upon time. The closing of the transactions contemplated
by this Agreement (the “Closing”) shall occur on the Closing Date at such location as may be agreed to by the parties.

 

2.            REPRESENTATIONS
AND WARRANTIES OF THE BUYER. The Buyer represents and warrants to the Company that:

 

a.Investment Purpose.
As of the date hereof, the Buyer is purchasing the Note and the shares of Common Stock issuable upon conversion of or otherwise
pursuant to the Note (including, without limitation, such additional shares of Common Stock, if any, as are issuable (i) on
account of interest on the Note or (ii) as a result of the events described in Sections 1.3 and 1.4(g) of the Note, such shares
of Common Stock being collectively referred to herein as the “Conversion Shares” and, collectively with the Note, the
“Securities”) for its own account and not with a present view towards the public sale or distribution thereof, except
pursuant to sales registered or exempted from registration under the 1933 Act; provided, however, that by making
the representations herein, the Buyer 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 1933 Act.

 

b.Accredited Investor
Status. The Buyer is an “accredited investor” as that term is defined in Rule 501(a) of Regulation D (an “Accredited
Investor”).

 

c.Reliance on Exemptions.
The Buyer understands that the Securities are being offered and sold to it in reliance upon specific exemptions from the registration
requirements of United States federal and state securities laws and that the Company is relying upon the truth and accuracy of,
and the Buyer’s compliance with, the representations, warranties, agreements, acknowledgments and understandings of the
Buyer set forth herein in order to determine the availability of such exemptions and the eligibility of the Buyer to acquire the
Securities.
  

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d.Information.
The Buyer and its advisors, if any, have been, and for so long as the Note remains outstanding will continue to be, furnished
with all materials relating to the business, finances and operations of the Company and materials relating to the offer and sale
of the Securities which have been requested by the Buyer or its advisors. The Buyer and its advisors, if any, have been, and for
so long as the Note remains outstanding will continue to be, afforded the opportunity to ask questions of the Company. Notwithstanding
the foregoing, the Company has not disclosed to the Buyer any material nonpublic information and will not disclose such information
unless such information is disclosed to the public prior to or promptly following such disclosure to the Buyer. Neither such inquiries
nor any other due diligence investigation conducted by Buyer or any of its advisors or representatives shall modify, amend or
affect Buyer’s right to rely on the Company’s representations and warranties contained in Section 3 below. The Buyer
understands that its investment in the Securities involves a significant degree of risk. The Buyer is not aware of any facts that
may constitute a breach of any of the Company's representations and warranties made herein.

 

e.Governmental Review.
The Buyer understands that no United States federal or state agency or any other government or governmental agency has passed upon
or made any recommendation or endorsement of the Securities.

 

f.Transfer or Re-sale.
The Buyer understands that (i) the sale or re-sale of the Securities has not been and is not being registered under the 1933 Act
or any applicable state securities laws, and the Securities may not be transferred unless (a) the Securities are sold pursuant
to an effective registration statement under the 1933 Act, (b) the Buyer shall have delivered to the Company, at the cost
of the Buyer, an opinion of counsel that shall be in form, substance and scope customary for opinions of counsel in comparable
transactions to the effect that the Securities to be sold or transferred may be sold or transferred pursuant to an exemption from
such registration, which opinion shall be accepted by the Company, (c) the Securities are sold or transferred to an “affiliate”
(as defined in Rule 144 promulgated under the 1933 Act (or a successor rule) (“Rule 144”)) of the Buyer who agrees
to sell or otherwise transfer the Securities only in accordance with this Section 2(f) and who is an Accredited Investor, (d) the
Securities are sold pursuant to Rule 144, or (e) the Securities are sold pursuant to Regulation S under the 1933 Act (or a
successor rule) (“Regulation S”), and the Buyer shall have delivered to the Company, at the cost of the Buyer, an opinion
of counsel that shall be in form, substance and scope customary for opinions of counsel in corporate transactions, which opinion
shall be accepted by the Company; (ii) any sale of such Securities made in reliance on Rule 144 may be made only in accordance
with the terms of said Rule and further, if said Rule is not applicable, any re-sale of such Securities under circumstances in
which the seller (or the person through whom the sale is made) may be deemed to be an underwriter (as that term is defined in the
1933 Act) may require compliance with some other exemption under the 1933 Act or the rules and regulations of the SEC thereunder;
and (iii) neither the Company nor any other person is under any obligation to register such Securities under the 1933 Act or any
state securities laws or to comply with the terms and conditions of any exemption thereunder (in each case). Notwithstanding the
foregoing or anything else contained herein to the contrary, the Securities may be pledged as collateral in connection with a bona
fide margin account or other lending arrangement.

 

 

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g.Legends. The
Buyer understands that the Note and, until such time as the Conversion Shares have been registered under the 1933 Act may be sold
pursuant to Rule 144 or Regulation S without any restriction as to the number of securities as of a particular date that can then
be immediately sold, the Conversion Shares may bear a restrictive legend in substantially the following form (and a stop-transfer
order may be placed against transfer of the certificates for such Securities): 

 

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

 

The legend set forth above
shall be removed and the Company shall issue a certificate without such legend to the holder of any Security upon which it is stamped,
if, unless otherwise required by applicable state securities laws, (a) such Security is registered for sale under an effective
registration statement filed under the 1933 Act or otherwise may be sold pursuant to Rule 144 or Regulation S without any restriction
as to the number of securities as of a particular date that can then be immediately sold, or (b) such holder provides the Company
with an opinion of counsel, in form, substance and scope customary for opinions of counsel in comparable transactions, to the effect
that a public sale or transfer of such Security may be made without registration under the 1933 Act, which opinion shall be accepted
by the Company so that the sale or transfer is effected. The Buyer agrees to sell all Securities, including those represented by
a certificate(s) from which the legend has been removed, in compliance with applicable prospectus delivery requirements, if any.
In the event that the Company does not accept the opinion of counsel, in the form, substance and scope described above, provided
by the Buyer with respect to the transfer of Securities pursuant to an exemption from registration, such as Rule 144 or Regulation
S, at the Deadline (as defined in the Note), it will be considered an Event of Default pursuant to Section 3.2 of the Note.

 

h.Authorization;
Enforcement. This Agreement has been duly and validly authorized. This Agreement has been duly executed and delivered on behalf
of the Buyer, and this Agreement constitutes a valid and binding agreement of the Buyer enforceable in accordance with its terms.

 

i.Residency.
The Buyer is a resident of the jurisdiction set forth immediately below the Buyer’s name on the signature pages hereto.

 

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3.            REPRESENTATIONS
AND WARRANTIES OF THE COMPANY. The Company represents and warrants to the Buyer that:

 

a.Organization and
Qualification. The Company and each of its Subsidiaries (as defined below), if any, is a corporation duly organized, validly
existing and in good standing under the laws of the jurisdiction in which it is incorporated, with full power and authority (corporate
and other) to own, lease, use and operate its properties and to carry on its business as and where now owned, leased, used, operated
and conducted. Schedule 3(a) sets forth a list of all of the Subsidiaries of the Company and the jurisdiction in which each is
incorporated. The Company and each of its Subsidiaries is duly qualified as a foreign corporation to do business and is in good
standing in every jurisdiction in which its ownership or use of property or the nature of the business conducted by it makes such
qualification necessary except where the failure to be so qualified or in good standing would not have a Material Adverse Effect.
“Material Adverse Effect” means any material adverse effect on the business, operations, assets, financial condition
or prospects of the Company or its Subsidiaries, if any, taken as a whole, or on the transactions contemplated hereby or by the
agreements or instruments to be entered into in connection herewith. “Subsidiaries” means any corporation or other
organization, whether incorporated or unincorporated, in which the Company owns, directly or indirectly, any equity or other ownership
interest.

 

b.Authorization;
Enforcement. (i) The Company has all requisite corporate power and authority to enter into and perform this Agreement, the
Note and to consummate the transactions contemplated hereby and thereby and to issue the Securities, in accordance with the terms
hereof and thereof, (ii) the execution and delivery of this Agreement, the Note by the Company and the consummation by it of the
transactions contemplated hereby and thereby (including without limitation, the issuance of the Note and the issuance and reservation
for issuance of the Conversion Shares issuable upon conversion or exercise thereof) have been duly authorized by the Company’s
Board of Directors and no further consent or authorization of the Company, its Board of Directors, or its shareholders is required,
(iii) this Agreement has been duly executed and delivered by the Company by its authorized representative, and such authorized
representative is the true and official representative with authority to sign this Agreement and the other documents executed
in connection herewith and bind the Company accordingly, and (iv) this Agreement constitutes, and upon execution and delivery
by the Company of the Note, each of such instruments will constitute, a legal, valid and binding obligation of the Company enforceable
against the Company in accordance with its terms.

 

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c.Capitalization.
As of November 12, 2014, the authorized capital stock of the Company consists of: (i) 1,000,000,000 shares of Common Stock, $0.0001
par value per share, of which 417,275,828 shares are issued and outstanding; and (ii) 100,000,000 shares of Preferred Stock, $0.001
par value per share, of which 337,315 shares are issued and outstanding. Except as disclosed in the SEC Documents, plus an additional
34,594,911 shares reserved for stock purchase warrants and 205,264,797 shares for conversion of convertible notes, and 12,500,000
shares reserved for issuance pursuant to the Company’s stock option plans, no shares are reserved for issuance pursuant to
securities (other than the Note) exercisable for, or convertible into or exchangeable for shares of Common Stock and 13,654,207
shares are reserved for issuance upon conversion of the Note. All of such outstanding shares of capital stock are, or upon issuance
will be, duly authorized, validly issued, fully paid and non-assessable. No shares of capital stock of the Company are subject
to preemptive rights or any other similar rights of the shareholders of the Company or any liens or encumbrances imposed through
the actions or failure to act of the Company. Except as disclosed in the SEC Documents, as of the effective date of this Agreement,
(i) there are no outstanding options, warrants, scrip, rights to subscribe for, puts, calls, rights of first refusal, agreements,
understandings, claims or other commitments or rights of any character whatsoever relating to, or securities or rights convertible
into or exchangeable for any shares of capital stock of the Company or any of its Subsidiaries, or arrangements by which the Company
or any of its Subsidiaries is or may become bound to issue additional shares of capital stock of the Company or any of its Subsidiaries,
(ii) there are no agreements or arrangements under which the Company or any of its Subsidiaries is obligated to register the sale
of any of its or their securities under the 1933 Act and (iii) there are no anti-dilution or price adjustment provisions contained
in any security issued by the Company (or in any agreement providing rights to security holders) that will be triggered by the
issuance of the Note or the Conversion Shares. The Company has filed in its SEC Documents true and correct copies of the Company’s
Certificate of Incorporation as in effect on the date hereof (“Certificate of Incorporation”), the Company’s
By-laws, as in effect on the date hereof (the “By-laws”), and the terms of all securities convertible into or exercisable
for Common Stock of the Company and the material rights of the holders thereof in respect thereto. The Company shall provide the
Buyer with a written update of this representation signed by the Company’s Chief Executive on behalf of the Company as of
the Closing Date.

 

d.Issuance of Shares.
The Conversion Shares are duly authorized and reserved for issuance and, upon conversion of the Note in accordance with its respective
terms, will be validly issued, fully paid and non-assessable, and free from all taxes, liens, claims and encumbrances with respect
to the issue thereof and shall not be subject to preemptive rights or other similar rights of shareholders of the Company and will
not impose personal liability upon the holder thereof.

 

e.Acknowledgment
of Dilution. The Company understands and acknowledges the potentially dilutive effect to the Common Stock upon the issuance
of the Conversion Shares upon conversion of the Note. The Company further acknowledges that its obligation to issue Conversion
Shares upon conversion of the Note in accordance with this Agreement, the Note is absolute and unconditional regardless of the
dilutive effect that such issuance may have on the ownership interests of other shareholders of the Company. 
  

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f.No Conflicts.
The execution, delivery and performance of this Agreement, the Note by the Company and the consummation by the Company of the transactions
contemplated hereby and thereby (including, without limitation, the issuance and reservation for issuance of the Conversion Shares)
will not (i) conflict with or result in a violation of any provision of the Certificate of Incorporation or By-laws, or (ii) violate
or conflict with, or result in a breach of any provision of, or constitute a default (or an event which with notice or lapse of
time or both could become a default) under, or give to others any rights of termination, amendment, acceleration or cancellation
of, any agreement, indenture, patent, patent license or instrument to which the Company or any of its Subsidiaries is a party,
or (iii) result in a violation of any law, rule, regulation, order, judgment or decree (including federal and state securities
laws and regulations and regulations of any self-regulatory organizations to which the Company or its securities are subject) applicable
to the Company or any of its Subsidiaries or by which any property or asset of the Company or any of its Subsidiaries is bound
or affected (except for such conflicts, defaults, terminations, amendments, accelerations, cancellations and violations as would
not, individually or in the aggregate, have a Material Adverse Effect). Neither the Company nor any of its Subsidiaries is in violation
of its Certificate of Incorporation, By-laws or other organizational documents and neither the Company nor any of its Subsidiaries
is in default (and no event has occurred which with notice or lapse of time or both could put the Company or any of its Subsidiaries
in default) under, and neither the Company nor any of its Subsidiaries has taken any action or failed to take any action that would
give to others any rights of termination, amendment, acceleration or cancellation of, any agreement, indenture or instrument to
which the Company or any of its Subsidiaries is a party or by which any property or assets of the Company or any of its Subsidiaries
is bound or affected, except for possible defaults as would not, individually or in the aggregate, have a Material Adverse Effect.
The businesses of the Company and its Subsidiaries, if any, are not being conducted, and shall not be conducted so long as the
Buyer owns any of the Securities, in violation of any law, ordinance or regulation of any governmental entity. Except as specifically
contemplated by this Agreement and as required under the 1933 Act and any applicable state securities laws, the Company is not
required to obtain any consent, authorization or order of, or make any filing or registration with, any court, governmental agency,
regulatory agency, self-regulatory organization or stock market or any third party in order for it to execute, deliver or perform
any of its obligations under this Agreement, the Note in accordance with the terms hereof or thereof or to issue and sell the Note
in accordance with the terms hereof and to issue the Conversion Shares upon conversion of the Note. All consents, authorizations,
orders, filings and registrations which the Company is required to obtain pursuant to the preceding sentence have been obtained
or effected on or prior to the date hereof. The Company is not in violation of the listing requirements of the Over-the-Counter
Bulletin Board (the “OTCBB”), the OTCQB or any similar quotation system, and does not reasonably anticipate that the
Common Stock will be delisted by the OTCBB, the OTCQB or any similar quotation system, in the foreseeable future. The Company and
its Subsidiaries are unaware of any facts or circumstances which might give rise to any of the foregoing.

 

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g.SEC Documents;
Financial Statements. The Company has timely filed all reports, schedules, forms, statements and other documents required to
be filed by it with the SEC pursuant to the reporting requirements of the Securities Exchange Act of 1934, as amended (the “1934
Act”) (all of the foregoing filed prior to the date hereof and all exhibits included therein and financial statements and
schedules thereto and documents (other than exhibits to such documents) incorporated by reference therein, being hereinafter referred
to herein as the “SEC Documents”). The Buyer acknowledges that it has been provided full access to the SEC Documents
for its review and its records at the SEC’s website for this purpose as www.sec.gov, including such exhibits and incorporated
documents. As of their respective dates, the SEC Documents complied in all material respects with the requirements of the 1934
Act and the rules and regulations of the SEC promulgated thereunder applicable to the SEC Documents, and none of the SEC Documents,
at the time they were filed with the SEC, contained any untrue statement of a material fact or omitted to state a material fact
required to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they
were made, not misleading. None of the statements made in any such SEC Documents is, or has been, required to be amended or updated
under applicable law (except for such statements as have been amended or updated in subsequent filings prior to the date hereof).
As of their respective dates, the financial statements of the Company included in the SEC Documents complied as to form in all
material respects with applicable accounting requirements and the published rules and regulations of the SEC with respect thereto.
Such financial statements have been prepared in accordance with United States generally accepted accounting principles, consistently
applied, during the periods involved and fairly present in all material respects the financial position of the Company as of the
dates thereof and the results of its operations and cash flows for the periods then ended (subject, in the case of unaudited statements,
to normal year-end audit adjustments). Except as set forth in the financial statements of the Company included in the SEC Documents,
the Company has no liabilities, contingent or otherwise, other than (i) liabilities incurred in the ordinary course of business
subsequent to June 30, 2014, and (ii) obligations under contracts and commitments incurred in the ordinary course of business and
not required under generally accepted accounting principles to be reflected in such financial statements, which, individually or
in the aggregate, are not material to the financial condition or operating results of the Company. The Company is subject to the
reporting requirements of the 1934 Act. For the avoidance of doubt, filing of the documents required in this Section 3(g) via the
SEC’s Electronic Data Gathering, Analysis, and Retrieval system (“EDGAR”) shall satisfy all delivery requirements
of this Section 3(g).

 

h.Absence of Certain
Changes. Since June 30, 2014, there has been no material adverse change and no material adverse development in the assets,
liabilities, business, properties, operations, financial condition, results of operations, prospects or 1934 Act reporting status
of the Company or any of its Subsidiaries.

 

i.Absence of Litigation.
There is no action, suit, claim, proceeding, inquiry or investigation before or by any court, public board, government agency,
self-regulatory organization or body pending or, to the knowledge of the Company or any of its Subsidiaries, threatened against
or affecting the Company or any of its Subsidiaries, or their officers or directors in their capacity as such, that could have
a Material Adverse Effect. Schedule 3(i) contains a complete list and summary description of any pending or, to the knowledge of
the Company, threatened proceeding against or affecting the Company or any of its Subsidiaries, without regard to whether it would
have a Material Adverse Effect. The Company and its Subsidiaries are unaware of any facts or circumstances which might give rise
to any of the foregoing.

 

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j.Patents, Copyrights,
etc. The Company and each of its Subsidiaries owns or possesses the requisite licenses or rights to use all patents, patent
applications, patent rights, inventions, know-how, trade secrets, trademarks, trademark applications, service marks, service names,
trade names and copyrights (“Intellectual Property”) necessary to enable it to conduct its business as now operated
(and, as presently contemplated to be operated in the future). Except as disclosed in the SEC Documents, there is no claim or action
by any person pertaining to, or proceeding pending, or to the Company’s knowledge threatened, which challenges the right
of the Company or of a Subsidiary with respect to any Intellectual Property necessary to enable it to conduct its business as now
operated (and, as presently contemplated to be operated in the future); to the best of the Company’s knowledge, the Company’s
or its Subsidiaries’ current and intended products, services and processes do not infringe on any Intellectual Property or
other rights held by any person; and the Company is unaware of any facts or circumstances which might give rise to any of the foregoing.
The Company and each of its Subsidiaries have taken reasonable security measures to protect the secrecy, confidentiality and value
of their Intellectual Property.

 

k.No Materially
Adverse Contracts, Etc. Neither the Company nor any of its Subsidiaries is subject to any charter, corporate or other legal
restriction, or any judgment, decree, order, rule or regulation which in the judgment of the Company’s officers has or is
expected in the future to have a Material Adverse Effect. Neither the Company nor any of its Subsidiaries is a party to any contract
or agreement which in the judgment of the Company’s officers has or is expected to have a Material Adverse Effect.

 

l.Tax Status.
The Company and each of its Subsidiaries has made or filed all federal, state and foreign income and all other tax returns, reports
and declarations required by any jurisdiction to which it is subject (unless and only to the extent that the Company and each of
its Subsidiaries has set aside on its books provisions reasonably adequate for the payment of all unpaid and unreported taxes)
and has paid all taxes and other governmental assessments and charges that are material in amount, shown or determined to be due
on such returns, reports and declarations, except those being contested in good faith and has set aside on its books provisions
reasonably adequate for the payment of all taxes for periods subsequent to the periods to which such returns, reports or declarations
apply. There are no unpaid taxes in any material amount claimed to be due by the taxing authority of any jurisdiction, and the
officers of the Company know of no basis for any such claim. The Company has not executed a waiver with respect to the statute
of limitations relating to the assessment or collection of any foreign, federal, state or local tax. None of the Company’s
tax returns is presently being audited by any taxing authority.

 

m.Certain Transactions.
Except for arm’s length transactions pursuant to which the Company or any of its Subsidiaries makes payments in the ordinary
course of business upon terms no less favorable than the Company or any of its Subsidiaries could obtain from third parties and
other than the grant of stock options disclosed on Schedule 3(c), none of the officers, directors, or employees of the Company
is presently a party to any transaction with the Company or any of its Subsidiaries (other than for services as employees, officers
and directors), including any contract, agreement or other arrangement providing for the furnishing of services to or by, providing
for rental of real or personal property to or from, or otherwise requiring payments to or from any officer, director or such employee
or, to the knowledge of the Company, any corporation, partnership, trust or other entity in which any officer, director, or any
such employee has a substantial interest or is an officer, director, trustee or partner.

 

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n.Disclosure.
All information relating to or concerning the Company or any of its Subsidiaries set forth in this Agreement and provided to the
Buyer pursuant to Section 2(d) hereof and otherwise in connection with the transactions contemplated hereby is true and correct
in all material respects and the Company has not omitted to state any material fact necessary in order to make the statements made
herein or therein, in light of the circumstances under which they were made, not misleading. No event or circumstance has occurred
or exists with respect to the Company or any of its Subsidiaries or its or their business, properties, prospects, operations or
financial conditions, which, under applicable law, rule or regulation, requires public disclosure or announcement by the Company
but which has not been so publicly announced or disclosed (assuming for this purpose that the Company’s reports filed under
the 1934 Act are being incorporated into an effective registration statement filed by the Company under the 1933 Act).

 

o.Acknowledgment
Regarding Buyer’ Purchase of Securities. The Company acknowledges and agrees that the Buyer is acting solely in the capacity
of arm’s length purchasers with respect to this Agreement and the transactions contemplated hereby. The Company further acknowledges
that the Buyer is not acting as a financial advisor or fiduciary of the Company (or in any similar capacity) with respect to this
Agreement and the transactions contemplated hereby and any statement made by the Buyer or any of its respective representatives
or agents in connection with this Agreement and the transactions contemplated hereby is not advice or a recommendation and is merely
incidental to the Buyer’ purchase of the Securities. The Company further represents to the Buyer that the Company’s
decision to enter into this Agreement has been based solely on the independent evaluation of the Company and its representatives.

 

p.No Integrated
Offering. Neither the Company, nor any of its affiliates, nor any person acting on its or their behalf, has directly or indirectly
made any offers or sales in any security or solicited any offers to buy any security under circumstances that would require registration
under the 1933 Act of the issuance of the Securities to the Buyer. The issuance of the Securities to the Buyer will not be integrated
with any other issuance of the Company’s securities (past, current or future) for purposes of any shareholder approval provisions
applicable to the Company or its securities.

 

q.No Brokers.
The Company has taken no action which would give rise to any claim by any person for brokerage commissions, transaction fees or
similar payments relating to this Agreement or the transactions contemplated hereby.

 

r.Permits; Compliance.
The Company and each of its Subsidiaries is in possession of all franchises, grants, authorizations, licenses, permits, easements,
variances, exemptions, consents, certificates, approvals and orders necessary to own, lease and operate its properties and to carry
on its business as it is now being conducted (collectively, the “Company Permits”), and there is no action pending
or, to the knowledge of the Company, threatened regarding suspension or cancellation of any of the Company Permits. Neither the
Company nor any of its Subsidiaries is in conflict with, or in default or violation of, any of the Company Permits, except for
any such conflicts, defaults or violations which, individually or in the aggregate, would not reasonably be expected to have a
Material Adverse Effect. Since June 30, 2014, neither the Company nor any of its Subsidiaries has received any notification with
respect to possible conflicts, defaults or violations of applicable laws, except for notices relating to possible conflicts, defaults
or violations, which conflicts, defaults or violations would not have a Material Adverse Effect.

 

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s.Environmental
Matters.

 

(i)        There are, to the
Company’s knowledge, with respect to the Company or any of its Subsidiaries or any predecessor of the Company, no past or
present violations of Environmental Laws (as defined below), releases of any material into the environment, actions, activities,
circumstances, conditions, events, incidents, or contractual obligations which may give rise to any common law environmental liability
or any liability under the Comprehensive Environmental Response, Compensation and Liability Act of 1980 or similar federal, state,
local or foreign laws and neither the Company nor any of its Subsidiaries has received any notice with respect to any of the foregoing,
nor is any action pending or, to the Company’s knowledge, threatened in connection with any of the foregoing. The term “Environmental
Laws” means all federal, state, local or foreign laws relating to pollution or protection of human health or the environment
(including, without limitation, ambient air, surface water, groundwater, land surface or subsurface strata), including, without
limitation, laws relating to emissions, discharges, releases or threatened releases of chemicals, pollutants contaminants, or toxic
or hazardous substances or wastes (collectively, “Hazardous Materials”) into the environment, or otherwise relating
to the manufacture, processing, distribution, use, treatment, storage, disposal, transport or handling of Hazardous Materials,
as well as all authorizations, codes, decrees, demands or demand letters, injunctions, judgments, licenses, notices or notice letters,
orders, permits, plans or regulations issued, entered, promulgated or approved thereunder.

 

(ii)       Other than those
that are or were stored, used or disposed of in compliance with applicable law, no Hazardous Materials are contained on or about
any real property currently owned, leased or used by the Company or any of its Subsidiaries, and no Hazardous Materials were released
on or about any real property previously owned, leased or used by the Company or any of its Subsidiaries during the period the
property was owned, leased or used by the Company or any of its Subsidiaries, except in the normal course of the Company’s
or any of its Subsidiaries’ business.

 

(iii)      There are no underground
storage tanks on or under any real property owned, leased or used by the Company or any of its Subsidiaries that are not in compliance
with applicable law.

 

t.Title to Property.
Except as disclosed in the SEC Documents the Company and its Subsidiaries have good and marketable title in fee simple to all real
property and good and marketable title to all personal property owned by them which is material to the business of the Company
and its Subsidiaries, in each case free and clear of all liens, encumbrances and defects or such as would not have a Material Adverse
Effect. Any real property and facilities held under lease by the Company and its Subsidiaries are held by them under valid, subsisting
and enforceable leases with such exceptions as would not have a Material Adverse Effect.

 

    	11

    	 

    

 

u.Internal Accounting
Controls. Except as disclosed in the SEC Documents the Company and each of its Subsidiaries maintain a system of internal accounting
controls sufficient, in the judgment of the Company’s board of directors, to provide reasonable assurance that (i) transactions
are executed in accordance with management’s general or specific authorizations, (ii) transactions are recorded as necessary
to permit preparation of financial statements in conformity with generally accepted accounting principles and to maintain asset
accountability, (iii) access to assets is permitted only in accordance with management’s general or specific authorization
and (iv) the recorded accountability for assets is compared with the existing assets at reasonable intervals and appropriate action
is taken with respect to any differences.

 

v.Foreign Corrupt
Practices. Neither the Company, nor any of its Subsidiaries, nor any director, officer, agent, employee or other person acting
on behalf of the Company or any Subsidiary has, in the course of his actions for, or on behalf of, the Company, used any corporate
funds for any unlawful contribution, gift, entertainment or other unlawful expenses relating to political activity; made any direct
or indirect unlawful payment to any foreign or domestic government official or employee from corporate funds; violated or is in
violation of any provision of the U.S. Foreign Corrupt Practices Act of 1977, as amended, or made any bribe, rebate, payoff, influence
payment, kickback or other unlawful payment to any foreign or domestic government official or employee.

 

w.Solvency.
The Company (after giving effect to the transactions contemplated by this Agreement) is solvent (i.e., its assets have a
fair market value in excess of the amount required to pay its probable liabilities on its existing debts as they become absolute
and matured) and currently the Company has no information that would lead it to reasonably conclude that the Company would not,
after giving effect to the transaction contemplated by this Agreement, have the ability to, nor does it intend to take any action
that would impair its ability to, pay its debts from time to time incurred in connection therewith as such debts mature. The Company
did not receive a qualified opinion from its auditors with respect to its most recent fiscal year end and, after giving effect
to the transactions contemplated by this Agreement, does not anticipate or know of any basis upon which its auditors might issue
a qualified opinion in respect of its current fiscal year. For the avoidance of doubt any disclosure of the Borrower’s ability
to continue as a “going concern” shall not, by itself, be a violation of this Section 3(w).

 

x.No Investment
Company. The Company is not, and upon the issuance and sale of the Securities as contemplated by this Agreement will not be
an “investment company” required to be registered under the Investment Company Act of 1940 (an “Investment Company”).
The Company is not controlled by an Investment Company.

 

y. Insurance.
The Company and each of its Subsidiaries are insured by insurers of recognized financial responsibility against such losses and
risks and in such amounts as management of the Company believes to be prudent and customary in the businesses in which the Company
and its Subsidiaries are engaged. Neither the Company nor any such Subsidiary has any reason to believe that it will not be able
to renew its existing insurance coverage as and when such coverage expires or to obtain similar coverage from similar insurers
as may be necessary to continue its business at a cost that would not have a Material Adverse Effect. Upon written request the
Company will provide to the Buyer true and correct copies of all policies relating to directors’ and officers’ liability
coverage, errors and omissions coverage, and commercial general liability coverage.

 

    	12

    	 

    

 

z.Shell Status.
The Company represents that it is not a “shell” issuer and has never been a “shell” issuer, or that if
it previously has been a “shell” issuer, that at least twelve (12) months have passed since the Company has reported
Form 10 type information indicating that it is no longer a “shell” issuer.

 

aa. Breach
of Representations and Warranties by the Company. If the Company breaches any of the representations or warranties set forth
in this Section 3, and in addition to any other remedies available to the Buyer pursuant to this Agreement, it will be considered
an Event of Default under Section 3.5 of the Note.

 

4.           COVENANTS.

 

a.Best Efforts.
The parties shall use their commercially reasonable best efforts to satisfy timely each of the conditions described in Section
7 and 8 of this Agreement.

 

b.Reserved.

 

c.Use of Proceeds.
The Company shall use the proceeds from the sale of the Note for working capital and other general corporate purposes and shall
not, directly or indirectly, use such proceeds for any loan to or investment in any other corporation, partnership, enterprise
or other person (except in connection with its currently existing direct or indirect Subsidiaries).

 

d.Notice of Subsequent
Transaction. While any amount remains outstanding under the Note, the Company shall, prior to the closing of any equity financing
(including debt with an equity component) (“Future Offerings”), provide written notice to the Buyer describing the
proposed Future Offering, including the terms and conditions thereof. In the event the terms and conditions of a proposed Future
Offering are amended in any respect after delivery of the notice to the Buyer concerning the proposed Future Offering, the Company
shall deliver a new notice to the Buyer describing the amended terms and conditions of the proposed Future Offering. The foregoing
sentence shall apply to successive amendments to the terms and conditions of any proposed Future Offering.

 

    	13

    	 

    

 

e.Expenses.
At the Closing, the Company shall reimburse Buyer for expenses incurred by them in connection with the negotiation, preparation,
execution, delivery and performance of this Agreement and the other agreements to be executed in connection herewith (“Documents”),
including, without limitation, reasonable attorneys’ and consultants’ fees and expenses, transfer agent fees, fees
for stock quotation services, fees relating to any amendments or modifications of the Documents or any consents or waivers of provisions
in the Documents, fees for the preparation of opinions of counsel, escrow fees, and costs of restructuring the transactions contemplated
by the Documents. When possible, the Company must pay these fees directly, including, but not limited to, any and all wire fees,
otherwise the Company must make immediate payment for reimbursement to the Buyer for all fees and expenses immediately upon written
notice by the Buyer or the submission of an invoice by the Buyer. The Company’s obligation with respect to this transaction
is to reimburse Buyer’s expenses shall be $2,750 plus the cost of wire fees.

 

f.Financial Information.
The Company agrees to send or make available the following reports to the Buyer until the Buyer transfers, assigns, or sells all
of the Securities: (i) within ten (10) days after the filing with the SEC, a copy of its Annual Report on Form 10-K its Quarterly
Reports on Form 10-Q and any Current Reports on Form 8-K; (ii) within one (1) day after release, copies of all press releases
issued by the Company or any of its Subsidiaries; and (iii) contemporaneously with the making available or giving to the shareholders
of the Company, copies of any notices or other information the Company makes available or gives to such shareholders. For the avoidance
of doubt, filing the documents required in (i) above via EDGAR or releasing any documents set forth in (ii) above via a recognized
wire service shall satisfy the delivery requirements of this Section 4(f).

 

g.Listing. The
Company shall promptly secure the listing of the Conversion Shares upon each national securities exchange or automated quotation
system, if any, upon which shares of Common Stock are then listed (subject to official notice of issuance) and, so long as the
Buyer owns any of the Securities, shall maintain, so long as any other shares of Common Stock shall be so listed, such listing
of all Conversion Shares from time to time issuable upon conversion of the Note. The Company will obtain and, so long as the Buyer
owns any of the Securities, maintain the listing and trading of its Common Stock on the OTCBB, OTCQB or any equivalent replacement
exchange, the Nasdaq National Market (“Nasdaq”), the Nasdaq SmallCap Market (“Nasdaq SmallCap”), the New
York Stock Exchange (“NYSE”), or the NYSE MKT and will comply in all respects with the Company’s reporting, filing
and other obligations under the bylaws or rules of the Financial Industry Regulatory Authority (“FINRA”) and such exchanges,
as applicable. The Company shall promptly provide to the Buyer copies of any material notices it receives from the OTCBB, OTCQB
and any other exchanges or quotation systems on which the Common Stock is then listed regarding the continued eligibility of the
Common Stock for listing on such exchanges and quotation systems.

 

h.Corporate Existence.
So long as the Buyer beneficially owns any Note, the Company shall maintain its corporate existence and shall not sell all or substantially
all of the Company’s assets, except in the event of a merger or consolidation or sale of all or substantially all of the
Company’s assets, where the surviving or successor entity in such transaction (i) assumes the Company’s obligations
hereunder and under the agreements and instruments entered into in connection herewith and (ii) is a publicly traded corporation
whose Common Stock is listed for trading on the OTCBB, OTCQB, Nasdaq, NasdaqSmallCap, NYSE or AMEX.

 

    	14

    	 

    

 

i.No Integration.
The Company shall not make any offers or sales of any security (other than the Securities) under circumstances that would require
registration of the Securities being offered or sold hereunder under the 1933 Act or cause the offering of the Securities to be
integrated with any other offering of securities by the Company for the purpose of any stockholder approval provision applicable
to the Company or its securities.

 

j.Failure to Comply
with the 1934 Act. So long as the Buyer beneficially owns the Note, the Company shall comply with the reporting requirements
of the 1934 Act; and the Company shall continue to be subject to the reporting requirements of the 1934 Act.

 

k.Trading Activities.
Neither the Buyer nor its affiliates has an open short position (or other hedging or similar transactions) in the common stock
of the Company and the Buyer agree that it shall not, and that it will cause its affiliates not to, engage in any short sales of
or hedging transactions with respect to the common stock of the Company.

l.Breach of Covenants.
If the Company breaches any of the covenants set forth in this Section 4, and in addition to any other remedies available to the
Buyer pursuant to this Agreement, it will be considered an Event of Default under Section 3.4 of the Note.

 

5.            Reserved.

 

6.            Transfer Agent Instructions.
In the event that the Borrower proposes to replace its transfer agent, and provided the successor transfer agent policies permit
it to honor irrevocable instructions from issuers it represents, the Borrower shall provide, prior to the effective date of such
replacement, fully executed irrevocable instructions to its transfer agent to issue certificates, registered in the name of the
Buyer or its nominee, for the Conversion Shares in such amounts as specified from time to time by the Buyer to the Company upon
conversion of the Note in accordance with the terms thereof (the “Irrevocable Transfer Agent Instructions”)in a form
agreed upon by the parties signed, by the successor transfer agent to Borrower and the Borrower. Prior to registration of the Conversion
Shares under the 1933 Act or the date on which the Conversion Shares may be sold pursuant to Rule 144 without any restriction as
to the number of Securities as of a particular date that can then be immediately sold, all such certificates shall bear the restrictive
legend specified in Section 2(g) of this Agreement.  The Company warrants that: (i) no instruction other than the Irrevocable
Transfer Agent Instructions referred to in this Section, and stop transfer instructions to give effect to Section 2(f) hereof (in
the case of the Conversion Shares, prior to registration of the Conversion Shares under the 1933 Act or the date on which the Conversion
Shares may be sold pursuant to Rule 144 without any restriction as to the number of Securities as of a particular date that can
then be immediately sold), will be given by the Company to its successor transfer agent, if applicable, and that the Securities
shall otherwise be freely transferable on the books and records of the Company as and to the extent provided in this Agreement
and the Note; (ii) it will not direct its transfer agent not to transfer or delay, impair, and/or hinder its transfer agent in
transferring (or issuing) (electronically or in certificated form) any certificate for Conversion Shares to be issued to the Buyer
upon conversion of or otherwise pursuant to the Note as and when required by the Note and this Agreement; and (iii) it will not
fail to remove (or directs its transfer agent not to remove or impairs, delays, and/or hinders its transfer agent from removing)
any restrictive legend (or to withdraw any stop transfer instructions in respect thereof) on any certificate for any Conversion
Shares issued to the Buyer upon conversion of or otherwise pursuant to the Note as and when required by the Note and this Agreement. 
Nothing in this Section shall affect in any way the Buyer’s obligations and agreement set forth in Section 2(g) hereof to
comply with all applicable prospectus delivery requirements, if any, upon re-sale of the Securities.  If the Buyer provides
the Company, at the cost of the Buyer, with (i) an opinion of counsel in form, substance and scope customary for opinions in comparable
transactions, to the effect that a public sale or transfer of such Securities may be made without registration under the 1933 Act
and such sale or transfer is effected or (ii) the Buyer provides reasonable assurances that the Securities can be sold pursuant
to Rule 144, the Company shall permit the transfer, and, in the case of the Conversion Shares, promptly instruct its transfer agent
to issue one or more certificates, free from restrictive legend, in such name and in such denominations as specified by the Buyer. 
The Company acknowledges that a breach by it of its obligations hereunder will cause irreparable harm to the Buyer, by vitiating
the intent and purpose of the transactions contemplated hereby.  Accordingly, the Company acknowledges that the remedy at
law for a breach of its obligations under this Section may be inadequate and agrees, in the event of a breach or threatened breach
by the Company of the provisions of this Section, that the Buyer shall be entitled, in addition to all other available remedies,
to an injunction restraining any breach and requiring immediate transfer, without the necessity of showing economic loss and without
any bond or other security being required.

 

    	15

    	 

    

 

7.            CONDITIONS PRECEDENT
TO THE COMPANY’S OBLIGATIONS TO SELL. The obligation of the Company hereunder to issue and sell the Note to the Buyer
at the Closing is subject to the satisfaction, at or before the Closing Date of each of the following conditions thereto, 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:

 

a.The Buyer shall have
executed this Agreement and delivered the same to the Company.

 

b.The Buyer shall have
delivered the Purchase Price in accordance with Section 1(b) above.

 

c.The representations
and warranties of the Buyer shall be true and correct in all material respects 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), and the Buyer shall have
performed, satisfied and complied in all material respects with the covenants, agreements and conditions required by this Agreement
to be performed, satisfied or complied with by the Buyer at or prior to the Closing Date.

 

d.No litigation, statute,
rule, regulation, executive order, decree, ruling or injunction shall have been enacted, entered, promulgated or endorsed by or
in any court or governmental authority of competent jurisdiction or any self-regulatory organization having authority over the
matters contemplated hereby which prohibits the consummation of any of the transactions contemplated by this Agreement.

 

    	16

    	 

    

 

8.            CONDITIONS PRECEDENT
TO THE BUYER’S OBLIGATION TO PURCHASE. The obligation of the Buyer hereunder to purchase the Note 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 Buyer’s sole benefit and may be waived by the Buyer at any time in its sole discretion:

 

a.The Company shall
have executed this Agreement and delivered the same to the Buyer.

 

b.The Company shall
have delivered to the Buyer duly executed Note (in such denominations as the Buyer shall request) in accordance with Section 1(b)
above.

 

c.The Irrevocable Transfer
Agent Instructions, in form and substance satisfactory to a majority-in-interest of the Buyer, shall have been delivered to and
acknowledged in writing by the Company’s Transfer Agent.

 

d.The representations
and warranties of the Company shall be true and correct in all material respects as of the date when made and as of the Closing
Date as though made at such time (except for representations and warranties that speak as of a specific date) and the Company shall
have performed, satisfied and complied in all material respects with the covenants, agreements and conditions required by this
Agreement to be performed, satisfied or complied with by the Company at or prior to the Closing Date. The Buyer shall have received
a certificate or certificates, executed by the chief executive officer of the Company, dated as of the Closing Date, to the foregoing
effect and as to such other matters as may be reasonably requested by the Buyer including, but not limited to certificates with
respect to the Company’s Certificate of Incorporation, By-laws and Board of Directors’ resolutions relating to the
transactions contemplated hereby.

 

e.No litigation, statute,
rule, regulation, executive order, decree, ruling or injunction shall have been enacted, entered, promulgated or endorsed by or
in any court or governmental authority of competent jurisdiction or any self-regulatory organization having authority over the
matters contemplated hereby which prohibits the consummation of any of the transactions contemplated by this Agreement.

 

f.No event shall have
occurred which could reasonably be expected to have a Material Adverse Effect on the Company including but not limited to a change
in the 1934 Act reporting status of the Company or the failure of the Company to be timely in its 1934 Act reporting obligations.

 

    	17

    	 

    

 

g.The Conversion Shares
shall have been authorized for quotation on the OTCBB, OTCQB or any similar quotation system and trading in the Common Stock on
the OTCBB, OTCQB or any similar quotation system shall not have been suspended by the SEC or the OTCBB, OTCQB or any similar quotation
system.

 

h.The Buyer shall have
received an officer’s certificate described in Section 3(c) above, dated as of the Closing Date.

 

9.            GOVERNING
LAW; MISCELLANEOUS.

 

a.Governing Law.
This Agreement shall be governed by and construed in accordance with the laws of the State of Nevada without regard to principles
of conflicts of laws. Any action brought by either party against the other concerning the transactions contemplated by this Agreement
shall be brought only in the state courts of Massachusetts or in the federal courts located in the state of Massachusetts. The
parties to this Agreement hereby irrevocably waive any objection to jurisdiction and venue of any action instituted hereunder and
shall not assert any defense based on lack of jurisdiction or venue or based upon forum non conveniens. The Company and
Buyer waive trial by jury. The prevailing party shall be entitled to recover from the other party its reasonable attorney's fees
and costs. In the event that any provision of this Agreement or any other agreement delivered in connection herewith is invalid
or unenforceable under any applicable statute or rule of law, then such provision shall be deemed inoperative to the extent that
it may conflict therewith and shall be deemed modified to conform with such statute or rule of law. Any such provision which may
prove invalid or unenforceable under any law shall not affect the validity or enforceability of any other provision of any agreement.
Each party hereby irrevocably waives personal service of process and consents to process being served in any suit, action or proceeding
in connection with this Agreement or any other Transaction Document by mailing a copy thereof via registered or certified mail
or overnight delivery (with evidence of delivery) to such party at the address in effect for notices to it under this Agreement
and agrees that such service shall constitute good and sufficient service of process and notice thereof. Nothing contained herein
shall be deemed to limit in any way any right to serve process in any other manner permitted by law.

 

b.Counterparts;
Signatures by Facsimile. This Agreement may be executed in one or more counterparts, each of which shall be deemed an original
but all of which shall constitute one and the same agreement and shall become effective when counterparts have been signed by each
party and delivered to the other party. This Agreement, once executed by a party, may be delivered to the other party hereto by
facsimile transmission of a copy of this Agreement bearing the signature of the party so delivering this Agreement.

 

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

 

    	18

    	 

    

 

d.Severability.
In the event that any provision of this Agreement is invalid or unenforceable under any applicable statute or rule of law, then
such provision shall be deemed inoperative to the extent that it may conflict therewith and shall be deemed modified to conform
with such statute or rule of law. Any provision hereof which may prove invalid or unenforceable under any law shall not affect
the validity or enforceability of any other provision hereof.

 

e.Entire Agreement;
Amendments. 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, neither the Company nor the
Buyer makes any representation, warranty, covenant or undertaking with respect to such matters. No provision of this Agreement
may be waived or amended other than by an instrument in writing signed by the majority in interest of the Buyer and the Company.

 

f.Notices. All
notices, demands, requests, consents, approvals, and other communications required or permitted hereunder shall be in writing and,
unless otherwise specified herein, shall be (i) personally served, (ii) deposited in the mail, registered or certified, return
receipt requested, postage prepaid, (iii) delivered by reputable air courier service with charges prepaid, or (iv) transmitted
by hand delivery, telegram, or facsimile, addressed as set forth below or to such other address as such party shall have specified
most recently by written notice. Any notice or other communication required or permitted to be given hereunder shall be deemed
effective (a) upon hand delivery or delivery by facsimile, with accurate confirmation generated by the transmitting facsimile machine,
at the address or number designated below (if delivered on a business day during normal business hours where such notice is to
be received), or the first business day following such delivery (if delivered other than on a business day during normal business
hours where such notice is to be received) or (b) on the second business day following the date of mailing by express courier service,
fully prepaid, addressed to such address, or upon actual receipt of such mailing, whichever shall first occur. The addresses for
such communications shall be:

 

If to the Company,
to:

 

Coates International
Ltd.

Highway 34
& Ridgewood Road

Wall Township,
NJ 07719

Attn: Barry C. Kaye; Chief Financial
Officer

Facsimile: (732) 449-0764

 

If to the Buyer:

 

Auctus Private
Equity Fund, LLC

101 Arch Street,
20th Floor

Boston, MA 02110

Attn:Lou Posner

Facsimile:
(617) 532-6420

 

    	19

    	 

    

 

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

 

Lucosky Brookman
LLP

101 Wood Avenue
South, 5th Floor

Woodbridge,
NJ 08830

Attn: Joseph
M. Lucosky, Esq.

Facsimile:
(732) 395-4401

 

Each party shall provide
notice to the other party of any change in address.

 

g.Successors and
Assigns. This Agreement shall be binding upon and inure to the benefit of the parties and their successors and assigns. Neither
the Company nor the Buyer shall assign this Agreement or any rights or obligations hereunder without the prior written consent
of the other. Notwithstanding the foregoing, subject to Section 2(f), the Buyer may assign its rights hereunder to any person
that purchases Securities in a private transaction from the Buyer or to any of its “affiliates,” as that term is defined
under the 1934 Act, with the prior written consent of the Company, which consent shall not be unreasonably withheld.

 

h.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.

 

i.Survival.
The representations and warranties of the Company and the agreements and covenants set forth in this Agreement shall survive the
closing hereunder not withstanding any due diligence investigation conducted by or on behalf of the Buyer. The Company agrees to
indemnify and hold harmless the Buyer and all their officers, directors, employees and agents for loss or damage arising as a result
of or related to any breach or alleged breach by the Company of any of its representations, warranties and covenants set forth
in this Agreement or any of its covenants and obligations under this Agreement, including advancement of expenses as they are incurred.

 

j.Further Assurances.
Each party shall do and perform, or cause to be done and performed, all such further acts and things, and shall execute and deliver
all such other agreements, certificates, instruments and documents, as the other party may reasonably request in order to carry
out the intent and accomplish the purposes of this Agreement and the consummation of the transactions contemplated hereby.

 

k.No Strict Construction.
The language used in this Agreement will be deemed to be the language chosen by the parties to express their mutual intent, and
no rules of strict construction will be applied against any party. 

 

    	20

    	 

    

 

l.Remedies.
The Company acknowledges that a breach by it of its obligations hereunder may cause irreparable harm to the Buyer by vitiating
the intent and purpose of the transaction contemplated hereby. Accordingly, the Company acknowledges that the remedy at law for
a breach of its obligations under this Agreement will be inadequate and agrees, in the event of a breach or threatened breach by
the Company of the provisions of this Agreement, regardless of whether the breach has, in fact, caused irreparable harm to the
Buyer, that the Buyer shall be entitled, in addition to all other available remedies at law or in equity, and in addition to the
penalties assessable herein, to an injunction or injunctions restraining, preventing or curing any breach of this Agreement and
to enforce specifically the terms and provisions hereof, without the necessity of showing economic loss and without any bond or
other security being required.

 

m.Publicity.
The Company, and the Buyer shall have the right to review a reasonable period of time before issuance of any press releases, SEC,
OTCQB or FINRA filings, or any other public statements with respect to the transactions contemplated hereby; provided, however,
that the Company shall be entitled, without the prior approval of the Buyer, to make any press release or SEC, OTCQB (or other
applicable trading market) or FINRA filings with respect to such transactions as is required by applicable law and regulations
(although the Buyer shall be consulted by the Company in connection with any such press release prior to its release and shall
be provided with a copy thereof and be given an opportunity to comment thereon). The Buyer hereby acknowledges that it understands
that Company is required to disclose the material provisions of the transaction contemplated hereby in the notes to its financial
statements for any period being reported on, in which as there is, or was, any remaining unpaid balance due to the Buyer and that
the Company is also required to file a conformed copy of the Promissory Note and/or Securities Purchase Agreement as exhibits to
its next quarterly report on Form 10-Q to be filed with the Securities and Exchange Commission. The required disclosures in the
notes to its financial statements as discussed in this preceding sentence shall not be required to be discussed with, or approved
by, the Buyer.

 

[signature page follows]

 

    	21

    	 

    

 

IN WITNESS WHEREOF, the
undersigned Buyer and the Company have caused this Agreement to be duly executed as of the date first above written.

 

	COATES INTERNATIONAL LTD.
	 	 	 
	By: 	/s/ Barry C. Kaye	 
	Name: 	Barry C. Kaye	 
	Title: 	Chief Financial Officer	 
	 	 	 
	AUCTUS PRIVATE EQUITY FUND, LLC	 
	 	 	 
	By: 	/s/ Lou Posner	 
	Name: 	Lou Posner	 
	Title: 	Managing Director	 

 

AGGREGATE SUBSCRIPTION AMOUNT:

 

	Aggregate Principal Amount of Note:	US$40,000
	 	 
	Aggregate Purchase Price:	US$40,000

 

 

22Exhibit 10.1

 

EXECUTION VERSION

 

STOCK PURCHASE AGREEMENT

 

This STOCK PURCHASE AGREEMENT (this “Agreement”)
is made and entered into as of November 17, 2014 (the “Effective Date”) by and between Sha-Chelle
Manning (the “Seller”) and Astrotech Corporation, a Washington company (the “Company”).

 

recitals

 

WHEREAS, the Seller wishes to transfer
and sell, and the Company wishes to purchase, 100,000 shares (the “Shares”)
of the common stock, no par value, of the Company (“Common Stock”).

 

NOW, THEREFORE, in consideration of the
foregoing premises and the mutual agreements contained herein, intending to be legally bound hereby, the parties hereto agree as
follows:

 

AGREEMENT

 

1.          Purchase
and Sale.  Subject to the terms and conditions of this Agreement, the Seller hereby agrees to sell to the Company, and the
Company hereby agrees to purchase from the Seller, the Shares at a price per Share equal to the closing price of the Common Stock
on the NASDAQ Capital Market on the Closing Date (as defined below) (the “Per Share Purchase Price”).

 

2.           Closing.

 

2.1           The
closing of the purchase and sale of the Shares (the “Closing”) shall take place remotely via the exchange
of documents and signatures on the Effective Date or at such later date as the parties may agree (the date of the Closing is hereinafter
referred to as the “Closing Date”). On the Closing Date, the Company will pay, by wire transfer of immediately
available funds to an account designated by the Seller at least one business day prior to the Closing Date, an amount equal to
the product of (x) the number of Shares and (y) the Per Share Purchase Price.

 

2.2           On
or before the Closing Date, the Seller shall deliver to the Company a spousal consent in the form set forth in Exhibit A
hereto duly executed by the Seller’s spouse and consenting to the transactions contemplated by this Agreement (including,
without limitation, the sale of the Shares to the Company in accordance with Section 1).

 

2.3           If
the Shares are certificated, on the Closing Date (or as soon as practicable thereafter), the Seller will deliver (or cause to be
delivered) to the Company, against receipt of the aggregate purchase price in accordance with Section 2.1, a share certificate
of the Company for the Shares.

 

3.           Representations
and Warranties of the Company.  The Company represents and warrants to the Seller as of the date hereof and as of the Closing
Date as follows:

 

    	 

    	 

    

 

(a) Authorization, etc.  The Company has
full corporate power and authority to execute and deliver this Agreement and to carry out the transactions contemplated hereby.
This Agreement has been duly executed and delivered by the Company. Assuming the due execution of this Agreement by the Seller,
this Agreement constitutes a valid and binding agreement of the Company, enforceable against the Company in accordance with its
terms, except that (i) such enforcement may be limited by bankruptcy, insolvency, reorganization, moratorium or other similar
laws now or hereafter in effect relating to creditors’ rights generally and (ii) the remedy of specific performance
and injunctive and other forms of equitable relief may be subject to equitable defenses and to the discretion of the court before
which any proceeding therefor may be brought.

 

(b) No Conflict.  The execution and delivery
of this Agreement by the Company and the consummation of the transactions contemplated hereby will not (i) violate any law applicable
to the Company or (ii) conflict with, violate or constitute a breach or default under any material agreement as to which the Company
is a party or require the consent of any third party.

 

4.           Representations
and Warranties of the Seller.  The Seller represents and warrants to the Company as of the date hereof and as of the Closing
Date as follows:

 

(a) Ownership.  The Seller
is (and will be immediately prior to the Closing) the sole beneficial owner of the Shares, free and clear of any liens, claims
or encumbrances. The Seller has (and will have immediately prior to the Closing) good and marketable title to the Shares and the
right and authority to transfer the Shares to the Company pursuant to this Agreement.  Upon the consummation of the transactions
contemplated hereby on the Closing Date, the Seller will have transferred to the Company, and the Company will have acquired, good
and valid title to the Shares, free and clear of all liens, claims and encumbrances.

 

(b) Authorization, etc.  The Seller has
full personal power, competence, capacity and authority to execute and deliver this Agreement and to carry out the transactions
contemplated hereby, and the spousal consent required has been (or will be prior to the Closing) delivered in the form of Exhibit
A hereto. This Agreement has been duly executed and delivered by the Seller. Assuming the due execution of this Agreement by
the Company, this Agreement constitutes a valid and binding agreement of the Seller, enforceable against the Seller in accordance
with its terms, except that (i) such enforcement may be limited by bankruptcy, insolvency, reorganization, moratorium or other
similar laws now or hereafter in effect relating to creditors’ rights generally and (ii) the remedy of specific performance
and injunctive and other forms of equitable relief may be subject to equitable defenses and to the discretion of the court before
which any proceeding therefor may be brought.

 

(c) No Conflict.  The execution and delivery
of this Agreement by the Seller and the consummation of the transactions contemplated hereby will not (i) violate any law applicable
to the Seller or (ii) conflict with, violate or constitute a breach or default under any material agreement as to which the Seller
is a party or to which the Shares are subject or require the consent of any third party.

 

(d) Sophistication.  The Seller (i) has
such knowledge and experience in financial

 

    	-2-

    	 

    

 

and business matters as to be capable of evaluating the merits, risks and suitability
of the sale of the Shares and (ii) is consummating the sale of the Shares with a full understanding of all of the terms, conditions
and risks and willingly assumes those terms, conditions and risks. The Seller has evaluated the merits and risks of the sale of
the Shares based exclusively on her own independent review and consultations with such investment, legal, tax, accounting and other
advisers as the Seller has deemed necessary. The Seller has made her own decision concerning the sale of the Shares without reliance
on any representation or warranty of, or advice from, the Company or any of its employees or agents.

 

(f) Information.  Neither the Company nor
any of its employees or agents has been requested to or has provided the Seller with any information or advice with respect to
the Shares nor is such information or advice necessary or desired. The Seller acknowledges and understands that, notwithstanding
the fact that the Seller is a member of the Board of Directors of the Company, the Company may still possess material nonpublic
information regarding the Company not known to the Seller that may impact the value of the Shares (the “Information”),
and that the Company is not disclosing the Information to the Seller. The Seller understands, based on her experience, the disadvantage
to which she is subject due to the disparity of information between the Seller and the Company. Notwithstanding such disparity,
the Seller has deemed it appropriate to enter into this Agreement and to consummate the sale of the Shares to the Company. The
Seller agrees that the Company shall have no liability to the Seller whatsoever due to or in connection with the Company’s
use or non-disclosure of the Information or otherwise as a result of the sale of the Shares to the Company, and the Seller hereby
irrevocably waives any claim that she might have based on the failure of the Company to disclose the Information.

 

(g) Reliance.  The Seller acknowledges that
(i) the Company is relying on the Seller’s representations, warranties, acknowledgments and agreements in this Agreement
as a condition to proceeding with the purchase of the Shares and (ii) without such representations, warranties and agreements,
the Company would not enter into this Agreement or engage in the purchase of the Shares.

 

5.          Legal
Fees and Costs.  In the event of any disputes or controversies arising from this Agreement or its interpretation, the party
or parties prevailing in a court of competent jurisdiction, or receiving a settlement payment, will be entitled to receive reasonable
legal fees and related costs and expenses.

 

6.          Headings.  The headings of the sections and subsections of this Agreement are inserted for convenience only and shall not be deemed to constitute
a part of this Agreement.

 

7.          Survival.  All representations, warranties and covenants contained in this Agreement shall survive indefinitely.

 

8.          Publicity.  Except as may be required by applicable law or any rule or regulation to which the Seller is subject, the Seller hereto agrees
that no public announcement or other publicity regarding the transactions referred to herein shall be made by the Seller without
the consent of the Company (it being understood that the Company shall not be subject to any such restriction).

 

    	-3-

    	 

    

 

9.          Governing
Law.  This Agreement and all acts and transactions pursuant hereto and the rights and obligations of the parties hereto
shall be governed by, and construed and interpreted in accordance with, the laws of the State of New York, without giving effect
to principles of conflicts of law.

 

10.        Entire
Agreement; Severability.  Except as expressly set forth herein, this Agreement sets forth the entire agreement and understanding
of the parties relating to the subject matter herein and merges all prior discussions between them. In case any one or more of
the provisions contained in this Agreement or in any instrument contemplated hereby, or any application thereof, shall be invalid,
illegal or unenforceable in any respect, under the laws of any jurisdiction, the validity, legality and enforceability of the remaining
provisions contained herein and therein, and any other application thereof, shall not in any way be affected or impaired thereby
or under the laws of any other jurisdiction.

 

11.        Further
Assurances.  The Seller agrees to take, or cause to be taken, from and after the Closing Date, such further actions to execute,
deliver and file, or cause to be executed, delivered and filed, such further documents and instruments as may be necessary in order
to fully effectuate the purposes, terms and conditions of this Agreement, and the Seller hereby agrees to cooperate fully in any
such actions as the Company shall request.

 

12.        Amendment.  No modification, waiver or amendment of this Agreement shall be effective unless in writing signed by the parties hereto.

 

13.        Notices.  Any notice required or permitted by this Agreement shall be in writing and shall be deemed sufficient when delivered personally,
sent by fax (as evidenced by the sender’s confirmation of transmission), sent by electronic mail (as evidenced by the recipient’s
confirmation of receipt), or forty-eight (48) hours after being deposited in the U.S. mail, as certified or registered mail, with
postage prepaid, and addressed to the party to be notified at such party’s address as set forth on the signature page hereto
or subsequently modified by written notice and, with respect to the Company, with a copy to Sheppard, Mullin, Richter & Hampton
LLP, 30 Rockefeller Plaza, New York, New York 10112, Attention: John Hempill.

 

14.        Counterparts.  This Agreement may be executed in one or more counterparts, each of which shall be deemed an original and all of which together
shall constitute one instrument.

 

15.        Successors
and Assigns; Third Party Beneficiaries.  The terms and conditions of this Agreement shall inure to the benefit of and be
binding upon the respective successors and assigns of the parties. Nothing in this Agreement, express or implied, is intended to
confer upon any party other than the parties hereto or their respective successors and assigns any rights, remedies, obligations
or liabilities under or by reason of this Agreement, except as expressly provided in this Agreement.

 

[Signature
page follows]

 

    	-4-

    	 

    

 

IN WITNESS WHEREOF, the parties hereto
have executed this Agreement as of the date set forth above.

 

	 	SELLER:	 
	 	 	 
	 	SHA-CHELLE MANNING	 
	 	 	 
	 	/s/Sha-Chelle Manning	 
	 	(Signature)	 
	 	 	 
	 	Address:	 
	 	 	 
	 	 	 
	 	 	 

 

	 	COMPANY:
	 	 
	 	ASTROTECH CORPORATION
	 	 	 	 
	 	By:	 /s/Eric Stober	 
	 	 	Name: Eric Stober	 
	 	 	Title:   Chief Financial Officer	 
	 	 
	 	Address:
	 	 
	 	401 Congress Ave., Suite 1650
	 	Austin, Texas 78701

 

    	 

    	 

    

 

EXHIBIT A

 

FORM OF SPOUSAL
CONSENT

 

The
undersigned is the spouse of Sha-Chelle Manning, and acknowledges that he has read that certain Stock Purchase Agreement (the “Agreement”),
dated as of November 17, 2014, by and among Sha-Chelle Manning (the “Seller”) and Astrotech
Corporation, a Washington company (the “Company”), and understands its
provisions. The undersigned is aware that by the provisions of the Agreement, he and his spouse have agreed to sell certain shares
of common stock of the Company, including any community property interest or quasi-community property interest therein, in accordance
with the terms and provisions of the Agreement. The undersigned hereby expressly approves of and agrees to be bound by the provisions
of the Agreement in its entirety and agrees not to take any action at any time that might interfere with the transactions contemplated
by the Agreement.

 

	Date:  November __, 2014	 	By:	 	 
	 	 	 	Name:

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