Document:

Exhibit 10.11

 

STOCK OPTION AGREEMENT

 

This STOCK OPTION AGREEMENT (this “Agreement”) is made and entered into as of                                by and between RestorGenex Corporation, a Nevada corporation (the “Company”), and                                  (“Optionee”) with reference to the following facts:

 

At a meeting of the Company’s board of directors (the “Board”) on                       , 2014, the Board authorized the granting to Optionee stock options as part of Optionee’s employment package on the terms set forth herein.

 

NOW, THEREFORE, in consideration of the mutual promises and covenants hereinafter set forth, the Company and Optionee agree as follows:

 

1.                                      Grant of Option.  The Company hereby grants to Optionee, upon the terms and subject to the conditions set forth in this Agreement, an option (the “Option”) to purchase all or any portion of                              shares (the “Option Shares”) of the Company’s Common Stock (the “Common Stock”), at an exercise price of $               per share, which represents 100% of the fair market value of a share of Common Stock on                            (such exercise price, as adjusted from time to time pursuant to Section 5, the “Exercise Price”).

 

2.                                      Vesting.  The Option shall vest and become exercisable in 12 quarterly equal (or as nearly equal as possible) installments on the last calendar day of each calendar quarter over a three-year period and may be exercised at any time prior to the termination or expiration of the Option.  Optionee shall receive a full quarter of vesting for the              calendar quarter of         .

 

3.                                      Exercise of the Option.

 

3.1.                            Subject to the vesting in Section 2, the Option may be exercised, in whole or in part, at any time and from time to time, only by delivery to the Company of written notice of the exercise of the Option in form identical to Exhibit “A” attached to this Agreement stating the number of Option Shares being purchased (the “Purchased Shares”) (and the representation and warranties in the notice of exercise must be true and correct).  The Exercise Price shall be payable in full in any one of the following alternative forms:

 

(a)                                 Full payment in cash or certified bank or cashier’s check;

 

(b)                                 Any broker assisted cashless exercise procedure which is acceptable to the Company; or

 

(c)                                  Cashless net exercise.

 

Upon a cashless net exercise, Optionee shall receive the number of shares of Common Stock equal to a number (as determined below) of shares of Common Stock computed using the following formula:

 

	
 
    	

    	
 
    

 

 

	
Where
    	
 
    	
X
    	
=
    	
the   number of shares of Common Stock to be issued to the Optionee.
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
Y
    	
=
    	
the   number of shares of Common Stock purchasable upon exercise of all of the   Option or, if only a portion of the Option is being exercised, the portion of   the Option being exercised.
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
A
    	
=
    	
the   exercise price.
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
B
    	
=
    	
the   Per Share Market Value of one share of Common Stock on the trading day   immediately preceding the date of such election.
    

 

“Per Share Market Value” means on any particular date (a) the closing sales price per share of the Common Stock on such date on any registered national stock exchange on which the Common Stock is then listed, or if there is no such closing sales price on such date, then the closing sales price on such exchange on the date nearest preceding such date, or (b) if the Common Stock is not then listed on a registered national stock exchange, the closing sales price for a share of Common Stock in the over-the-counter market, as reported by the OTC Bulletin Board or the OTC Markets Group, or (c) if the Common Stock is not then publicly traded the fair market value of a share of Common Stock as determined in good faith by the Board; provided, however, that all determinations of the Per Share Market Value shall be appropriately adjusted for any stock dividends, stock splits or other similar transactions during such period.

 

3.2.                            Following receipt of the exercise notice and the payment referred to above, the Company shall, as soon as reasonably practicable thereafter, cause certificates representing the Purchased Shares to be delivered to Optionee either at Optionee’s address set forth in the records of the Company or at such other address as Optionee may designate in writing to the Company; provided, however, that the Company shall not be obligated to issue a fraction or fractions of a share otherwise issuable upon exercise of the Option, and may pay to Optionee, in cash or cash equivalent, the fair market value of any such fraction or fractions of a share as of the date of exercise.

 

3.3.                            If requested by the Company in connection with any exercise of the Option, Optionee shall also deliver this Agreement to the Company, which shall endorse hereon a notation of the exercise and, and if the Option is exercised in part, shall return this Agreement to Optionee.  The date of exercise of an Option that is validly exercised shall be deemed to be the date on which there shall have been delivered to the Company the instruments referred to in this Section 3.  Optionee shall not be deemed to be a holder of any Option Shares pursuant to exercise of the Option until the date of issuance of a stock certificate to Optionee for such shares following payment in full for the Option Shares purchased.

 

3.4.                            As a condition to exercise of the Option, the Company may require Optionee to pay to the Company all applicable federal, state and local taxes that the Company is required to withhold with respect to the exercise of the Option.  At the discretion of the Company and upon the request of Optionee, the minimum statutory withholding tax requirements may be satisfied by the withholding of Option Shares otherwise issuable to Optionee upon the exercise of the Option.

 

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4.                                      Termination of Option.

 

4.1.                            Except as provided in this Section 4, the Option shall terminate and expire upon the earlier to occur of                                and the date specified in Section 5.4 (the “Time of Termination”).

 

4.2.                            In the event the Optionee’s employment or other service with the Company and all subsidiaries is terminated by the Company for Cause (as defined in that certain Executive Employment Agreement dated as of                            between the Company and the Optionee (the “Employment Agreement”), the Option will immediately terminate without notice of any kind, and the Option will no longer be exercisable.

 

4.3.                            In the event the Optionee’s employment or other service with the Company and all subsidiaries is terminated by reason of the Optionee’s death or Disability (as defined in the Employment Agreement), the Option will remain exercisable, to the extent exercisable as of the date of such termination, for a period of one (1) year after such termination (but in no event after the Time of Termination).

 

4.4.                            In the event the Optionee’s employment with the Company and all subsidiaries is terminated by the Company without Cause (as defined in the Employment Agreement) or by the Optionee for Good Reason (as defined in the Employment Agreement), the Option will become immediately vested and exercisable immediately and remain exercisable for a period of one (1) year after such termination (but in no event after the Time of Termination).

 

4.5.                            In the event the Optionee’s employment or other service with the Company and all subsidiaries is terminated other than by reason of the Optionee’s death or Disability (as defined in the Employment Agreement), by the Company for Cause, by the Company without Cause or by the Optionee for Good Reason, the Option will remain exercisable, to the extent exercisable as of the date of such termination, for a period of three (3) months after such termination (but in no event after the Time of Termination).

 

5.                                      Changes in Capital Structure.

 

5.1.                            If outstanding shares of the Common Stock shall be subdivided into a greater number of shares, or a dividend in Common Stock shall be paid in respect of the Common Stock, the Exercise Price of the Option prior to such subdivision or at the record date of such dividend shall, simultaneously with the effectiveness of such subdivision or immediately after the record date of such dividend, be proportionately reduced, and conversely, if outstanding shares of the Common Stock of the Company shall be combined into a smaller number of shares, the Exercise Price of the Option prior to such combination shall, simultaneously with the effectiveness of such combination, be proportionately increased.  This Section 5.1 shall only be effective if and to the extent such change will not be treated as a modification of the Option under Treas. Reg. Sec. 1.409A-1(b)(5)(v)(H).

 

5.2.                            When any adjustment is required to be made in the Exercise Price, the number of Option Shares purchasable upon the exercise of the Option shall be adjusted to that number of Option Shares determined by dividing (a) an amount equal to the number of Option Shares purchasable upon the exercise of the Option immediately prior to such adjustment,

 

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multiplied by the Exercise Price in effect immediately prior to such adjustment, by (b) the Exercise Price in effect immediately after such adjustment.

 

5.3.                            Except as provided in Section 5.4, following any capital reorganization, any reclassification of the Common Stock of the Company (other than recapitalization described in Section 5.1), or the consolidation or merger of the Company, upon exercise of the Option the Optionee shall receive the securities or property (including cash) that the Optionee would have received had the Optionee exercised the Option immediately prior to such reorganization, reclassification, consolidation or merger, and in any such case appropriate adjustments shall be made in the application of the provisions set forth in this Agreement with respect to the rights and interests thereafter of the Optionee, to the end that the provisions set forth in this Agreement (including the specified changes and other adjustments to the Exercise Price) shall thereafter be applicable in relation to any securities or other property thereafter issuable upon exercise of the Option.

 

5.4.                            The Option shall become immediately vested and exercisable immediately prior to (but conditioned upon completion of) a Change in Control (as defined in the Employment Agreement) and remain exercisable through                             .  Notwithstanding any of the foregoing, in connection with a Change in Control, the Board in its sole discretion, at any time after the grant of the Option, may determine that the Option, whether or not exercisable or vested, as the case may be, will be canceled and terminated and that in connection with such cancellation and termination the Optionee will receive for each Option Share a cash payment (or the delivery of shares of stock, other securities or a combination of cash, stock and securities with a fair market value (as determined by the Board in good faith) equivalent to such cash payment) equal to the difference, if any, between the consideration received by stockholders of the Company in respect of a share of Common Stock in connection with such Change in Control and the Exercise Price per share under the Option, multiplied by the number of Option Shares; provided, however, that if such product is zero ($0) or less, the Option may be canceled and terminated without payment therefor.  If any portion of the consideration pursuant to a Change in Control may be received by holders of shares of Common Stock on a contingent or delayed basis, the Board may, in its sole discretion, determine the fair market value per share of such consideration as of the time of the Change in Control on the basis of the Board’s good faith estimate of the present value of the probable future payment of such consideration.  Notwithstanding the foregoing, any Option Shares issued pursuant to the Option prior to the effectiveness of the Change in Control will be deemed to be outstanding shares of Common Stock and receive the same consideration as other outstanding shares of Common Stock in connection with the Change in Control.

 

5.5.                            Notwithstanding any other provisions of this Agreement, if any “payments” (including, without limitation, any benefits or transfers of property or the acceleration of the vesting of any benefits) in the nature of compensation under any arrangement that is considered contingent on a Change in Control for purposes of Section 280G of the Internal Revenue Code of 1986, as amended (the “Code”), together with any other payments that the Optionee has the right to receive from the Company or any corporation that is a member of an “affiliated group” (as defined in Section 1504(a) of the Code without regard to Section 1504(b) of the Code) of which the Company is a member, would constitute a “parachute payment” (as defined in Section 280G(b)(2) of the Code), such “payments” may, at the Optionee’s sole

 

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election, be reduced to the largest amount as will result in no portion of such “payments” being subject to the excise tax imposed by Section 4999 of the Code.  The type of payments to be electively reduced under this Section 5.5, if any, will be at the discretion of the Optionee; provided, however, if any such payments are subject to Section 409A of the Code, such payments shall be reduced first, by first reducing any cash severance payments and then reducing all other payments and benefits, in each case, with the amounts having later payment dates being reduced first.

 

6.                                      Optionee’s Representations.  Optionee represents and warrants to and agrees with the Company as follows:

 

6.1.                            Optionee is acquiring the Option for Optionee’s own account, for investment purposes only and not with a view to or for sale in connection with a distribution of the Option.

 

6.2.                            Optionee understands that an investment in the Option involves a high degree of risk, and Optionee has the financial ability to bear the economic risk of this investment, including a complete loss of such investment.  Optionee has adequate means for providing for Optionee’s current financial needs and has no need for liquidity with respect to this investment.

 

6.3.                            Optionee has such knowledge and experience in financial and business matters that Optionee is capable of evaluating the merits and risks of an investment in the Option and in protecting Optionee’s own interest in connection with this transaction.

 

6.4.                            Optionee has had the opportunity to ask questions of, and to receive answers from, appropriate officers of the Company with respect to the terms and conditions of the transactions contemplated hereby and with respect to the business, affairs, financial condition and results of operations of the Company.  Optionee has had access to such financial and other information as is necessary in order for Optionee to make a fully informed decision as to investment in the Company, and has had the opportunity to obtain any additional information necessary to verify any of such information to which Optionee has had access.

 

6.5.                            Optionee acknowledges that if at the time of exercise of this Option by Optionee there is no effective registration statement registering the issuance of the Option Shares upon exercise of this Option under the Securities Act of 1933, as amended (the “Securities Act”), any certificate evidencing the Option Shares will have a legend to the following effect:

 

“THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 (THE “ACT”) OR ANY APPLICABLE STATE SECURITIES LAWS AND MAY NOT BE EXERCISED, SOLD, PLEDGED OR TRANSFERRED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT FOR SUCH SECURITIES UNDER THE ACT OR UNLESS AN EXEMPTION FROM SUCH REGISTRATION IS AVAILABLE.

 

6.6.                            Optionee has consulted with Optionee’s own tax counsel and advisors as to the federal, state and other tax consequences to Optionee of the grant and exercise of the Option and the sale of Option Shares, and acknowledges that the Company makes no representation or warranty to the Optionee regarding such tax consequences.

 

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7.                                      Modification.  The Option may not be amended or modified except by a written instrument executed by the Company and the Optionee.

 

8.                                      Market Stand-off.  The Optionee, if so requested by the Company or any representative of the underwriters in connection with the first firmly underwritten public offering of securities by the Company pursuant to a registration statement under the Securities Act following the date of this Agreement, shall not sell or otherwise transfer any Option Shares during the 180-day period following the effective date of such registration statement.  The Company may impose stop-transfer instructions with respect to securities subject to the foregoing restriction until the end of such 180-day period.  This Section 8 will not apply to the sale of any Option Shares to an underwriter pursuant to an underwriting agreement and shall only be applicable to the Optionee if all then current executive officers and directors of the Company enter into similar agreements.

 

9.                                      General Provisions.

 

9.1.                            Notices.  All notices, requests, demands and other communications (collectively, “Notices”) given pursuant to this Agreement shall be in writing, and shall be delivered by personal service, courier, facsimile transmission, email transmission of a pdf format data file or by United States first class, registered or certified mail, postage prepaid, addressed to the party at the address set forth on the signature page of this Agreement.  Any Notice, other than a Notice sent by registered or certified mail, shall be effective when received; a Notice sent by registered or certified mail, postage prepaid return receipt requested, shall be effective on the earlier of when received or the third day following deposit in the United States mails.  Any party may from time to time change its address for further Notices hereunder by giving notice to the other party in the manner prescribed in this Section.

 

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

 

9.3.                            Failure to Enforce Not a Waiver.  The failure of the Company or the Optionee to enforce at any time any provision of this Agreement shall in no way be construed to be a waiver of such provision or of any other provision hereof.

 

9.4.                            Governing Law.  This Agreement shall be governed by and construed in accordance with the laws of the State of Nevada applicable to contracts made in, and to be performed within, that State.

 

9.5.                            Option Non-transferable.  Optionee may not sell, transfer, assign or otherwise dispose of the Option other than (a) by will or by the laws of descent and distribution or (b) to a Family Member (within the meaning given such term in Form S-8 under the Securities Act) provided such transfer is made as a gift without consideration and such transfer complies with

 

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applicable securities laws.  The person or persons, if any, to whom this Option is transferred shall be treated after Optionee’s death the same as Optionee under this Agreement.

 

9.6.                            Successors and Assigns.  Except to the extent specifically limited by the terms and provision of this Agreement, this Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors, assigns, heirs and personal representatives.

 

9.7.                            Advice from Independent Counsel.  The parties hereto understand that this Agreement is a legally binding agreement that affects such party’s rights and imposes obligations on such party.  Each party represents to the other that it has received legal advice from counsel of its choice regarding the meaning and legal significance of this Agreement and that it is satisfied with its legal counsel and the advice received from it.

 

9.8.                            Miscellaneous.  Titles and captions contained in this Agreement are inserted for convenience of reference only and do not constitute a part of this Agreement for any other purpose.  References to Sections in this Agreement refer to Sections of this Agreement unless otherwise stated.  Except as specifically provided herein, neither this Agreement nor any right pursuant hereto or interest herein shall be assignable by any of the parties hereto without the prior written consent of the other party hereto.

 

[Remainder of page intentionally left blank; signature page follows]

 

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IN WITNESS WHEREOF, the Company has granted to Optionee the Option as of the date set forth above.

 

 

	
OPTIONEE:
    	
 
    	
RESTORGENEX   CORPORATION.
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
By:
    	
 
    
	
 
    	
 
    	
 
    	
Timothy   Boris, General Counsel
    
	
 
    	
 
    	
 
    
	
Address:
    	
 
    	
Address:
    	
1800   Century Park East, 6th Floor
    
	
 
    	
 
    	
 
    	
Los   Angeles, CA 90067
    
					

 

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EXHIBIT “A”

 

NOTICE OF EXERCISE

 

(To be signed only upon exercise of the Option)

 

TO:                           RestorGenex Corporation

 

The undersigned, the holder of the enclosed Stock Option Agreement (“Optionee”), hereby irrevocably elects to exercise the purchase right represented by the Option and to purchase thereunder             * shares (the “Option Shares”) of Common Stock of RestorGenex Corporation (the “Company”) and herewith encloses payment of $                   or pursuant to the cashless exercise provisions set forth in Section 3.1 in full payment of the purchase price of such shares being purchased.

 

The Optionee represents and warrants to the Company as follows:

 

1.                                      Optionee is acquiring the Option Shares for Optionee’s own account, for investment purposes only and not with a view to or for sale in connection with a distribution of the Option Shares.

 

2.                                      Optionee understands that an investment in the Option Shares involves a high degree of risk, and Optionee has the financial ability to bear the economic risk of this investment, including a complete loss of such investment.  Optionee has adequate means for providing for Optionee’s current financial needs and has no need for liquidity with respect to this investment.

 

3.                                      Optionee has such knowledge and experience in financial and business matters that he is capable of evaluating the merits and risks of an investment in the Option Shares and in protecting Optionee’s own interest in connection with this transaction.

 

4.                                      Optionee understands that if at the time of exercise of the Option by Optionee there is no effective registration statement registering the issuance of the Option Shares upon exercise of the Option under the Securities Act of 1933, as amended (the “Securities Act”), the Option Shares have not been registered under the Securities Act, the California Corporate Securities Law of 1968, as amended (the “California Law”) or other state securities laws.  Optionee is familiar with the provisions of the Securities Act and Rule 144 thereunder, and the California Law and understands that such restrictions on transfer of the Option Shares may result in Optionee being required to hold the Option Shares for an indefinite period of time.

 

5.                                      Optionee agrees not to transfer or encumber (“Transfer”) any of the Option Shares except pursuant to an effective registration statement under the Securities Act or an exemption from registration.  As a further condition to any such Transfer, except in the event that such Transfer is made pursuant to an effective registration statement under the Securities Act, if, in the reasonable opinion of counsel to the Company, any Transfer of the Option Shares by the contemplated

 

 

transferee thereof would not be exempt from the registration and prospectus delivery requirements of the Securities Act, the Company may require the contemplated transferee to furnish the Company with an investment letter setting forth such information and agreements as may be reasonably requested by the Company to ensure compliance by such transferee with the Securities Act.

 

6.                                      Optionee has had the opportunity to ask questions of, and to receive answers from, appropriate officers of the Company with respect to the terms and conditions of the transactions contemplated hereby and with respect to the business, affairs, financial condition and results of operations of the Company.  Optionee has had access to such financial and other information as is necessary in order for Optionee to make a fully informed decision as to investment in the Company, and has had the opportunity to obtain any additional information necessary to verify any of such information to which Optionee has had access.

 

7.                                      Optionee acknowledges that if at the time of exercise of the Option by Optionee there is no effective registration statement registering the issuance of the Option Shares upon exercise of the Option under the Securities Act any certificate evidencing the Option Shares will have a legend to the following effect:

 

“THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 (THE “ACT”) OR ANY APPLICABLE STATE SECURITIES LAWS AND MAY NOT BE EXERCISED, SOLD, PLEDGED OR TRANSFERRED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT FOR SUCH SECURITIES UNDER THE ACT OR UNLESS AN EXEMPTION FROM SUCH REGISTRATION IS AVAILABLE.”

 

8.                                      Optionee understands that the issuance of the Option Shares to Optionee may generate income, taxable at ordinary rates, equal to the value of the Shares less the exercise price and that the Options when they are exercised or at an earlier time may result in income, taxable at ordinary rates or greater (if a penalty rate is applicable), pursuant to Sections 83 or 409A of the Internal Revenue Code of 1986, as amended, and the regulations or proposed regulations thereunder.

 

	
Dated:
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
(Address)
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
Social Security Number
    

 

*Insert here the number of shares being exercised making all adjustments for cashless exercise pursuant to Section 3 or for stock splits, stock dividends or other additional Common Stock of the Company, other securities or property which, pursuant to the adjustment provisions of Section 5 of the Option, may be deliverable upon exercise.

 

2Exhibit 10.88

 

SUBSCRIPTION AGREEMENT

 

This
SUBSCRIPTION Agreement (this “Agreement”) is made as of July 3, 2014 by, and between CNS Response,
Inc., a Delaware corporation (the “Company”), and the investor(s) listed on Schedule A hereto (each,
an “Investor,” and collectively, the “Investors”).

 

WITNESSETH

 

In consideration for
the mutual promises and covenants herein, the parties agree as follows:

 

WHEREAS, the
Company is offering, in a private placement, up to $1.0 million of its Common Stock (“Common Stock”), par value
$0.001 per share (the “Shares”) for $0.25 per share in a private placement to accredited investors pursuant
to a Confidential Offering Memorandum dated July 3, 2014; and

 

WHEREAS, the
undersigned desires to subscribe for and purchase the number of Shares set forth on Schedule A hereto.

 

Section
1 – Purchase and Sale of SHARES

 

1.1          Purchase
and Sale of Shares. The Company has authorized the issuance and sale, in accordance with the terms hereof, of shares of Common
Stock, in the aggregate amount of up to $1,000,000 (the “Shares Cap Amount”),
subject to increase at the discretion of the Board of Directors of the Company (the “Board”).
On the terms and subject to the conditions set forth in this Agreement, at the Closings (as defined below), the Company agrees
to issue to each Investor, and the Investor agrees to purchase from the Company, in the amount set forth on Schedule A.
The Company will sell Shares to more than one Investor, each of whom will enter into Subscription Agreement substantially identical
to this one. 

 

1.2          Closings.

 

(a)          Initial
Closing. The initial purchase and sale of the Shares shall take place at a closing (the “Initial Closing”)
which shall take place remotely via exchange of documents and signatures at 10:00 a.m. Eastern Time on the business day immediately
following execution and delivery of this Agreement, or at such other place and time as may be agreed to among the Company and the
Investors. At the Initial Closing, the Company shall deliver to each of the Investors purchasing Shares for cash at such initial
closing a certificate or certification representing such number of Shares as is set forth opposite such Investor’s name on
Schedule A hereto against receipt of a check subject to collection or a wire transfer in immediately available funds of
the purchase price, to an account designated by the Company. 

 

    	 

    	 

    

  

(b)          Additional
Closings. The Company shall have the right, on one or more occasions, to hold additional closings (each, an “Additional
Closing,” and, collectively with the Initial Closing, the “Closings,”
and individually, a “Closing”), pursuant to which it shall have the right
to issue and sell additional Shares to additional Investors or existing Investors (provided that no Additional Closings shall take
place later than July 31, 2014, unless extended by the Board or upon the withdrawal of this offering by the Board, whichever occurs
sooner). At each Additional Closing, the Company shall deliver to each Investor purchasing Shares at such additional closing a
certificate or certification representing such number of Shares as is set forth opposite such Investor’s name on Schedule
A hereto against receipt of a check subject to collection or a wire transfer in immediately available funds of the purchase
price, to an account designated by the Company. By receiving Shares at an Additional Closing, each Investor so receiving Shares
thereby represents that its representations and warranties contained in Section 3 are true and correct as of the date of such Additional
Closing. The aggregate principal amount of Shares that may be issued at Closings hereunder shall, in no event exceed the Board
approved Share Cap Amount.

 

The obligation of each
Investor to purchase and pay cash for the Shares to be delivered at a Closing is, unless waived by such Investor, subject to the
condition that the Company’s representations and warranties contained in Section 2 are true, complete and correct on and
as of such Closing date. The obligation of the Company to sell and issue Shares to be delivered at a Closing is, unless waived
by the Company, subject to the condition that the relevant Investor’s representations and warranties contained in Section
3 are true, complete and correct on and as of the Closing Date.

 

Section
2 - Representations and Warranties

of
the Company

 

The Company represents
and warrants to each Investor as follows:

 

2.1         Existence
of Company. The Company is a duly organized Delaware corporation. The Company is validly existing in all jurisdictions where
it conducts its business.

 

2.2          Authority
to Execute. The execution, delivery and performance by the Company of this Agreement and the issuance of the Shares are within
the Company’s corporate powers, have been duly authorized by all necessary corporate action, do not and will not conflict
with any provision of law or organizational document of the Company (including its Certificate of Incorporation or Bylaws) or of
any agreement or contractual restrictions binding upon or affecting the Company or any of its property and need no further stockholder
or creditor consent.

 

2.3         No
Stockholder Approval Required. No approval of the Company’s stockholders is required for (i) the entry by the Company
into this Agreement, or (ii) the issuance of the Shares contemplated by this Agreement.

 

2.4         Valid
Issuance. The Shares will be, validly issued, fully paid and nonassessable and free of restrictions on transfer other than
restrictions on transfer under, applicable state and federal securities laws and liens or encumbrances created by or imposed by
the Investor. Assuming the accuracy of the representations of the Investor in Section 3 of this Agreement, and the Shares will
be issued in compliance with all applicable federal and state securities laws.

 

    	 

    	 

    

  

2.5         Binding
Obligation. This Agreement is, a valid and binding obligation of the Company enforceable against the Company in accordance
with its terms, subject, as to enforcement of remedies, to applicable bankruptcy, insolvency, moratorium, reorganization and similar
laws affecting creditors’ rights generally and to general equitable principles.

 

2.6         Litigation.
Other than the litigation disclosed in the Company’s most recent SEC Reports (as defined below), no litigation or governmental
proceeding is pending or threatened against the Company which may have a materially adverse effect on the financial condition,
operations or prospects of the Company, and to the knowledge of the Company, no basis therefore exists.

 

2.7         Intellectual
Property. To the best of the Company’s knowledge, the Company owns or possesses sufficient legal rights to all patents,
trademarks, service marks, trade names, copyrights, trade secrets, licenses, information and other proprietary rights and processes
necessary for its business as now conducted and as presently proposed to be conducted, without any known infringement of the rights
of others. There are no outstanding options, licenses or agreements of any kind relating to the foregoing proprietary rights, nor
is the Company bound by or a party to any options, licenses or agreements of any kind with respect to the patents, trademarks,
service marks, trade names, copyrights, trade secrets, licenses, information and other proprietary rights and processes of any
other person or entity other than such licenses or agreements arising from the purchase of “off the shelf” or standard
products.

 

2.8         SEC
Reports. The Company has filed all forms, reports, schedules, proxy statements,
registration statements and other documents (including all exhibits thereto) required to be filed by it with the U.S Securities
and Exchange Commission (the “SEC”) pursuant to the federal securities laws and the SEC rules and regulations
thereunder, together with all certifications required pursuant to the Sarbanes-Oxley Act of 2002 (the “Sarbanes-Oxley
Act”) (as they have been amended since the time of their filing, including all exhibits thereto, the “SEC Reports”).
Each of the SEC Reports complied in all material respects with the applicable requirements of the Securities Act of 1933, as amended
(the “Securities Act”) and the Securities Exchange Act of 1934, as amended, the Sarbanes-Oxley Act and the rules
and regulations of the SEC under all of the foregoing. None of the SEC Reports 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.

 

Section
3 - Representations and Warranties

of
the Investors

 

Each Investor represents
and warrants to the Company as follows:

 

3.1         Authorization;
Binding Obligations. The Investor has full power and authority to enter into this Agreement and this Agreement constitutes
a valid and legally binding obligation of the Investor, enforceable against the Investor in accordance with its terms, subject,
as to enforcement of remedies, to applicable bankruptcy, insolvency, moratorium, reorganization and similar laws affecting creditors’
rights generally and to general equitable principles.

 

    	 

    	 

    

  

3.2         Accredited
Investor. The Investor is an “accredited investor” within the meaning of SEC Rule 501 of Regulation D promulgated
under the Securities Act.

 

3.3         Investment
for Own Account. The Shares are being acquired for his, her or its own account, for investment and not with a view to, or for
resale in connection with, any distribution or public offering thereof within the meaning of the Securities Act.

 

3.4         Knowledge
and Experience. The Investor has such knowledge and experience in financial and business matters that (s)he is capable of evaluating
the merits and risks of an investment in the Shares and of making an informed investment decision with respect thereto, has the
ability and capacity to protect his/her interests and can bear the economic risk of the acceptance of the Shares, including a total
loss of his/her investment.

 

3.5        Opportunity
to Ask Questions. The Investor has had the opportunity to ask questions and receive answers from the Company or any authorized
person acting on its behalf concerning the Company and its business and to obtain any additional information, to the extent possessed
by the Company (or to the extent it could have been acquired by the Company without unreasonable effort or expense) necessary to
verify the accuracy of the information received by the Investor. In connection therewith, the Investor acknowledges that (s)he
has had the opportunity to discuss the Company’s business, management and financial affairs with the Company’s management
or any authorized person acting on its behalf.

 

3.6.        Receipt
of Information. The Investor has received and reviewed all of the information concerning the Company and the Shares, both written
and oral, that the Investor desires. Without limiting the generality of the foregoing, the Investor has been furnished with or
has had the opportunity to acquire, and to review: all information, both written and oral, that the Investor desires with respect
to the Company’s business, management, financial affairs and prospects. In determining whether to make this investment, the
Investor has relied solely on his/her own knowledge and understanding of the Company and its business and prospects based upon
the Investor’s own due diligence investigations and the Company’s filings with the SEC.

 

Section
4 - Miscellaneous

 

4.1          No
Waiver; Cumulative Remedies. No failure or delay on the part of any party to this Agreement in exercising any right or remedy
under, or pursuant to, this Agreement shall operate as a waiver thereof, nor shall any single or partial exercise of any such right,
remedy or power preclude other or further exercise thereof, or the exercise of any other right, remedy or power. The remedies in
this Agreement are cumulative and are not exclusive of any remedies provided by law.

 

4.2          Amendments
and Waivers. Except as otherwise expressly set forth in this Agreement, any term of this Agreement may be amended (either retroactively
or prospectively) with the written consent of the Company and the Investor. Any amendment effected in accordance with this Section
4.2 shall be binding upon each Investor, each future holder of Shares and the Company.

 

    	 

    	 

    

  

4.3          Notices,
Etc. All notices, requests, consents and other communications hereunder to any party shall be deemed to be sufficient if contained
in a written instrument delivered in person; sent by facsimile transmission; sent by electronic mail; duly sent by first class
registered or certified mail, return receipt requested, postage prepaid; or duly sent by overnight delivery service (e.g.,
Federal Express) addressed to such party (i) if to the Company, at the address, fax number or electronic mail address, as applicable,
set forth on the signature page hereof or (ii) if to an Investor, at the address, fax number or electronic mail address, as applicable,
set forth on Schedule A hereto, or at such other address, fax number or electronic mail address as may hereafter be designated
in writing by the addressee to the sender. All such notices, advises and communications shall be deemed to have been received:
(a) in the case of personal delivery, on the date of such delivery; (b) in the case of facsimile or electronic mail transmission,
on the date of transmission; and (c) in the case of mailing or delivery by service, on the date of delivery as shown on the return
receipt or delivery service statement.

 

4.4          Governing
Law. This Agreement shall be governed by and construed in accordance with the laws of the State of California, without regard
to the conflicts of law provisions of the State of California or of any other state. The Company and each Investor consent to personal
jurisdiction in Orange County, California.

 

4.5          Severability.
If any term in this Agreement is held to be illegal or unenforceable, the remaining portions of this Agreement shall not be affected,
and this Agreement shall be construed and enforced as if this Agreement did not contain the term held to be illegal or unenforceable.

 

4.6          Binding
Effect. This Agreement shall be binding upon and inure to the benefit of the Company and each Investor and their respective
successors and assigns.

 

4.7          Transfer
of Shares. Notwithstanding the legend required to be placed on the Shares by applicable law, no registration statement or opinion
of counsel shall be necessary: (a) for a transfer of Shares to the respective estate of each Investor or for a transfer of Shares
by gift, will or intestate succession of each Investor to his or her spouse or to the siblings, lineal descendants or ancestors
each Investor or his or her spouse, if the transferee agrees in writing to be subject to the terms hereof to the same extent as
if he or she were the original Investor hereunder; or (b) for a transfer of Shares pursuant to SEC Rule 144 or any successor rule,
or for a transfer of Shares pursuant to a registration statement declared effective by the SEC under the Securities Act relating
to the Shares.

 

4.8          Survival
of Representations, Warranties and Covenants. The representations and warranties of the parties contained in or made pursuant
to this Agreement shall survive the execution and delivery of this Agreement indefinitely, and shall in no way be affected by any
investigation of the subject matter thereof made by or on behalf of the other parties. The covenants of the parties contained in
or made pursuant to this Agreement shall survive the execution and delivery of this Agreement until such time as the Notes have
been paid in full.

 

    	 

    	 

    

  

4.9          California
Commissioner of Corporations. THE SALE OF THE SHARES WHICH ARE THE SUBJECT OF THIS AGREEMENT HAS NOT BEEN QUALIFIED WITH THE
COMMISSIONER OF CORPORATIONS OF THE STATE OF CALIFORNIA AND THE ISSUANCE OF THE SHARES OR PAYMENT OR RECEIPT OF ANY PART OF THE
CONSIDERATION FOR SUCH SHARES PRIOR TO THE QUALIFICATION IS UNLAWFUL, UNLESS THE SALE OF SHARES IS EXEMPT FROM QUALIFICATIONS BY
SECTION 25100, 25102 OR 25105 OF THE CALIFORNIA CORPORATIONS CODE. THE RIGHTS OF ALL PARTIES TO THIS AGREEMENT ARE EXPRESSLY CONDITIONED
UPON SUCH QUALIFICATION BEING OBTAINED, UNLESS THE SALE IS SO EXEMPT.

 

[Remainder of Page Intentionally Left
Blank]

 

    	 

    	 

    

  

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

 

	 	CNS RESPONSE, INC.
	 	 
	 	By:	 
	 	 	Name: Paul Buck
	 	 	Title: Chief Financial Officer

 

Address/Fax Number/E-mail Address for Notice:

 

85 Enterprise, Suite 410

Aliso Viejo, CA 92656

Fax: (866) 867 4446

pbuck@cnsresponse.com

 

	 	INVESTOR:
	 	 
	 	By:	 
	 	 	Name:
	 	 	 
	 	 	Title: 

 

    	 

    	 

    

  

SCHEDULE A

 

	Name,
    Address, Fax Number, E-Mail Address and Tax ID Number of Investor 	 	Aggregate
Purchase Price 

	
         

         

        Name:_________________________________

         

        Address:_______________________________

         

        ______________________________________

         

        Fax:__________________________________

         

        Email:_________________________________

         

        Tax ID:________________________________

         
	 	
         

         

        $______________________

	TOTAL:

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