Document:

Exhibit
10.1

 

EXECUTION
COPY

 

SECURITIES
PURCHASE AGREEMENT

 

This
Securities Purchase Agreement (this “Agreement”) is dated as of March 22, 2021, between Transportation and
Logistics Systems, Inc., a Nevada corporation (the “Company”), and each purchaser identified on the signature
pages hereto (each, including its successors and assigns, a “Purchaser” and collectively the “Purchasers”).

 

WHEREAS,
subject to the terms and conditions set forth in this Agreement and pursuant to an exemption from the registration requirements
of Section 5 of the Securities Act contained in Section 4(a)(2) thereof and/or Rule 506(b) thereunder, the Company desires to
issue and sell to each Purchaser, and each Purchaser, severally and not jointly, desires to purchase from the Company, securities
of the Company as more fully described in this Agreement.

 

NOW,
THEREFORE, IN CONSIDERATION of the mutual covenants contained in this Agreement, and for other good and valuable consideration
the receipt and adequacy of which are hereby acknowledged, the Company and each Purchaser agree as follows:

 

ARTICLE
I.

DEFINITIONS

 

Section
1.1 Definitions. For the purposes of this Agreement, the following words and phrases have the meanings set forth in this Section
1.1:

 

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

 

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

 

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

 

“Agreement”
shall have the meaning ascribed to such term in the preamble.

 

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

 

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

 

“Charter”
means the Articles or Certificate of Incorporation of the Company.

 

“Closing”
shall have the meaning ascribed to such term in Section 2.2.

 

“Closing
Date” means the Trading Day on which all of the Transaction Documents have been executed and delivered by the applicable
parties thereto, and all conditions precedent to (i) the Purchasers’ obligations to pay the Subscription Amount and (ii)
the Company’s obligations to deliver the Securities to be issued and sold, in each case, have been satisfied or waived,
but in no event later than the second Trading Day following the date hereof.

 

“Common
Stock” means the common stock of the Company, par value $0.001 per share, and any other class of securities into which
such securities may hereafter be reclassified or changed.

 

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“Common
Stock Equivalents” means any securities of the Company or the Subsidiaries which would entitle the holder thereof to
acquire Common Stock at any time, including, without limitation, any debt, preferred stock, right, option, warrant or other instrument
that is at any time convertible into or exercisable or exchangeable for, or otherwise entitles the holder thereof to receive,
Common Stock.

 

“Company”
shall have the meaning ascribed to such term in the preamble.

 

“Consent”
shall have the meaning ascribed to such term in Section 4.6.

 

“Conversion
Shares” means the shares of Common Stock issuable upon conversion of the Series E Shares.

 

“Disqualification
Event” shall have the meaning ascribed to such term in Section 3.1(jj).

 

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

 

“Effective
Date” shall have the meaning ascribed to such term in Section 4.1(c).

 

“Environmental
Laws” shall have the meaning ascribed to such term in Section 3.1(m).

 

“Escrow
Agent” means Nason Yeager Gerson Harris & Fumero, LLP.

 

“Escrow
Agreement” means the escrow agreement, in the form attached as Exhibit G.

 

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

 

“Exchange
Act” means the Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder.

 

“Exempt
Issuance” means the issuance of (a) shares of Common Stock or options to employees, officers or directors of the Company,
in an aggregate amount not to exceed 10% of shares of Common Stock outstanding pursuant to any stock or option plan duly adopted
for such purpose by the Board of Directors, (b) securities issuable upon the exercise or exchange of or conversion of any Securities
issued hereunder and/or other securities issuable pursuant to existing agreements, exercisable or exchangeable for or convertible
into shares of Common Stock issued and outstanding on the date of this Agreement, provided that such securities have not been
amended since the date of this Agreement to increase the number of such securities or to decrease the exercise price, exchange
price or conversion price of such securities (other than (1) in connection with stock dividends, stock splits or combinations
or (2) automatic adjustments to such terms pursuant to anti-dilution, default or similar provisions of such securities, including
for the avoidance of doubt the adjustments resulting from a Triggering Event (as defined in the Series E COD)) or to extend the
term of such securities, (c) securities issued pursuant to acquisitions or strategic transactions approved by a majority of the
directors of the Company, provided that any such issuance shall only be to a Person (or to the equityholders of a Person) which
is, itself or through its subsidiaries, an operating company or an owner of an asset in a business synergistic with the business
of the Company and shall provide to the Company additional benefits in addition to the investment of funds, but shall not include
a transaction in which the Company is issuing securities primarily for the purpose of raising capital or to an entity whose primary
business is investing in securities, or (d) securities issued for bonafide services provided to the Company not for the purpose
of raising capital or to an entity whose primary business is investing in securities.

 

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

 

“Federal
Reserve” shall have the meaning ascribed to such term in Section 3.1(nn).

 

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

 

“Hazardous
Materials” shall have the meaning ascribed to such term in Section 3.1(m).

 

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

 

“Initial
Closing” shall have the meaning ascribed to such term in Section 2.2.

 

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

 

“Issuer
Covered Person” and “Issuer Covered Persons” shall have the meanings ascribed to such terms in Section
3.1(jj).

 

“Laws”
means any U.S. federal, state, local, foreign or other laws, rules regulations, guidelines, orders, injunctions, building and
other codes, ordinances, permits, licenses, authorizations, judgements, decrees of federal, state, local, foreign or other authorities,
and all orders, writs, decrees and consents of any governmental or political subdivision or agency thereof, or any court of similar
tribunal established by any such governmental or political subdivision or agency thereof.

 

“Lead
Investor” means Cavalry Fund I, L.P.

 

“Legend
Removal Date” shall have the meaning ascribed to such term in Section 4.1(c).

 

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

 

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

 

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

 

“Money
Laundering Laws” shall have the meaning ascribed to such term in Section 3.1(oo).

 

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

 

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“Person”
means an individual or corporation, partnership, trust, incorporated or unincorporated association, joint venture, limited liability
company, joint stock company, government (or an agency or subdivision thereof) or other entity of any kind.

 

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

 

“Public
Information Failure” shall have the meaning ascribed to such term in Section 4.2(b).

 

“Purchaser”
and “Purchasers” shall have the meanings ascribed thereto in the preamble.

 

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

 

“Registration
Rights Agreement” means the registration rights agreement, in the form of Exhibit B.

 

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

 

“Required
Approvals” shall have the meaning ascribed to such term in Section 3.1(e).

 

“Rule
144” means Rule 144 promulgated by the SEC pursuant to the Securities Act, as such Rule may be amended or interpreted
from time to time, or any similar rule or regulation hereafter adopted by the SEC (or similar United States law) having substantially
the same purpose and effect as such Rule.

 

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

 

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

 

“Securities”
shall have the meaning ascribed to such term in Section 2.1(b).

 

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

 

“Series
E COD” shall have the meaning ascribed to such term in Section 2.1(a).

 

“Series
E Shares” shall have the meaning ascribed to such term in Section 2.1(b).

 

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

 

“Subscription
Amount” means, as to each Purchaser, the aggregate amount to be paid for the Series E Shares and Warrants purchased
hereunder as specified below such Purchaser’s name on the signature page of this Agreement and next to the heading.

 

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

 

“Trading
Day” means a day on which the principal Trading Market is open for trading.

 

“Trading
Market” means any of the following markets or exchanges on which the Common Stock is listed or quoted for trading on
the date in question: the Nasdaq Capital Market, the Nasdaq Global Market, the Nasdaq Global Select Market, the New York Stock
Exchange, the NYSE American, the OTCQB, the OTCQX, or the OTC Pink Marketplace (or any successors to any of the foregoing).

 

“Transaction
Documents” means this Agreement, the Series E COD, the Warrants, Escrow Agreement, the Registration Rights Agreement,
all schedules and exhibits thereto and hereto and any other documents or agreements executed in connection with the transactions
contemplated hereunder.

 

“Transfer
Agent” means Equiniti Trust Company, 1100 Centre Pointe Curve, Suite 101, Mendota Heights, MN 55120, and any successor
transfer agent of the Company.

 

“Units”
shall have the meaning ascribed to such term in Section 2.1(b).

 

“VWAP”
means, for any date, the price determined by the first of the following clauses that applies: (a) if the Common Stock is then
listed or quoted on a Trading Market, the daily volume weighted average price of the Common Stock for such date (or the nearest
preceding date) on the Trading Market on which the Common Stock is then listed or quoted as reported by Bloomberg L.P. (based
on a Trading Day from 9:30 a.m. (New York City time) to 4:02 p.m. (New York City time)) (or a similar organization or agency succeeding
to its functions of reporting prices), (b) if no volume weighted average price of the Common Stock can be ascertained from the
Trading Market, the average closing price of the Common Stock during the ten (10) Trading Days preceding such date, or (c) in
all other cases, the fair market value of a share of Common Stock as determined by the Board of Directors of the Company.

 

“Warrants”
means, collectively, the Common Stock purchase warrants delivered to the Purchasers at the Closing in accordance with Section
2.3(a) hereof, which Warrants shall be exercisable immediately and have a term of exercise equal to five years from such initial
exercise date, in the form of Exhibit C attached hereto.

 

“Warrant
Exercise Price” means $0.01 per share.

 

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

 

ARTICLE
II

PURCHASE AND SALE

 

Section
2.1 Sale and Issuance of Units.

 

(a)
The Company shall have adopted and filed with the Secretary of State of the State of Nevada on or before the Initial Closing (as
defined below) the Amended and Restated Certificate of Designation, Preferences, Rights and Limitations of Series E Convertible
Preferred Stock in the form of Exhibit A attached to this Agreement (the “Series E COD”).

 

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(b)
Subject to the terms and conditions of this Agreement, each Purchaser agrees to purchase at the applicable Closing (as defined
below) and the Company agrees to sell and issue to each Purchaser at the applicable Closing that number of units (the “Units”),
each consisting of one share of Series E Convertible Preferred Stock, $0.001 par value (the “Series E Shares”)
and a warrant to purchase 1,334 shares of Common Stock, subject to adjustment, at an initial exercise price of $0.01 per share,
set forth on such Purchaser’s signature page hereto, at a purchase price of $11.67
per Unit. The Units, Series E Shares, the Conversion Shares, the Warrants and the Warrants issued or issuable to the Purchasers
pursuant to this Agreement shall be referred to in this Agreement as the “Securities.”

 

Section
2.2 Closing. The initial purchase and sale of the Securities shall take place remotely via the exchange of documents and
signatures, 12;00 p.m., on March 22, 2021, or at such other time and place as the
Company and the Purchasers mutually agree upon, orally or in writing (which time and place are designated as the “Initial
Closing”). In the event there is more than one closing, the term “Closing” shall apply to each such
closing unless otherwise specified.

 

Section
2.3 Deliveries.

 

(a)
On or prior to the applicable Closing, the Company shall deliver or cause to be delivered to the Escrow Agent on behalf of each
Purchaser the following:

 

(i)
this Agreement duly executed by the Company;

 

(ii)
an original Warrant, exercisable at the Warrant Exercise Price, registered in the name of such Purchaser;

 

(iii)
the Registration Rights Agreement duly executed by the Company;

 

(iv)
a reservation letter executed by the Company in the form attached as Exhibit D;

 

(v)
the Escrow Agreement executed by the Company in the form attached as Exhibit G;

 

(vi)
board resolutions approving the issuance of the Series E Shares and the Warrants, and the execution of the Transaction Documents
on behalf of the Company; and

 

(vii)
a legal opinion in the form reasonably acceptable to the Lead Investor, limited to the opinion that the Preferred Stock is exempt
from registration requirements pursuant to Rule 144, promulgated by the SEC.

 

(b)
On or prior to the applicable Closing, each Purchaser shall deliver or cause to be delivered to the Escrow Agent the following:

 

(i)
this Agreement duly executed by such Purchaser;

 

(ii)
the Registration Rights Agreement duly executed by the Purchaser;

 

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(iii)
a reservation letter executed by the Purchaser in the form attached hereto as Exhibit D;

 

(iv)
the Escrow Agreement executed by the Purchaser; and

 

(v)
such Purchaser’s Subscription Amount by wire transfer to the Escrow Agent.

 

Section
2.4 Closing Conditions.

 

(a)
The obligations of the Company hereunder in connection with each applicable Closing are subject to the following conditions being
met:

 

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

 

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

 

(iii)
the delivery by each Purchaser of the items set forth in Section 2.3(b) of this Agreement.

 

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

 

(i)
the accuracy in all respects (or, to the extent representations or warranties are qualified by materiality or Material Adverse
Effect, in all respects) when made and on the Closing Date of the representations and warranties of the Company contained herein
(unless as of a specific date therein);

 

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

 

(iii)
the delivery by the Company of the items set forth in Section 2.3(a) of this Agreement;

 

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

 

(v)
from the date hereof to the Closing Date trading in the Common Stock shall not have been suspended by the SEC or the Company’s
principal Trading Market, and, at any time prior to the Closing Date, trading in securities generally as reported by Bloomberg
L.P. shall not have been suspended or limited, or minimum prices shall not have been established on securities whose trades are
reported by such service, or on any Trading Market, nor shall a banking moratorium have been declared either by the United States
or New York State authorities nor shall there have occurred any material outbreak or escalation of hostilities or other national
or international calamity of such magnitude in its effect on, or any material adverse change in, any financial market which, in
each case, in the reasonable judgment of such Purchaser, makes it impracticable or inadvisable to purchase the Securities at the
Closing.

 

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ARTICLE
III

REPRESENTATIONS AND WARRANTIES

 

Section
3.1 Representations and Warranties of the Company. The Company hereby represents and warrants to each Purchaser that, except
as set forth on the Disclosure Schedule to this Agreement, which exceptions shall be deemed to be part of the representations
and warranties made hereunder, the following representations are true and complete as of the date of the Initial Closing, except
as otherwise indicated. The Disclosure Schedule shall be arranged in sections corresponding to the numbered and lettered sections
contained in this Section 3.1, and the disclosures in any section of the Disclosure Schedule shall qualify other sections
in this Section 3.1 only to the extent it is readily apparent from a reading of the disclosure that such disclosure is
applicable to such other sections.

 

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

 

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

 

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

 

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(d)
No Conflicts. Except as set forth in Schedule 3.1(d), the execution, delivery and performance by the Company of
this Agreement and the other Transaction Documents to which it is a party, the issuance and sale of the Securities and the consummation
by it of the transactions contemplated hereby and thereby do not and will not (i) subject to the Required Approvals, conflict
with or violate any provision of the Company’s or any Subsidiary’s Charter, bylaws or other organizational or charter
documents, or (ii) constitute a default (or an event that with notice or lapse of time or both would become a default) under,
result in the creation of any Lien upon any of the properties or assets of the Company or any Subsidiary, or give to others any
rights of termination, amendment, acceleration or cancellation (with or without notice, lapse of time or both) of, any agreement,
credit facility, debt or other instrument (evidencing a Company or Subsidiary debt or otherwise) or other understanding to which
the Company or any Subsidiary is a party or by which any property or asset of the Company or any Subsidiary is bound or affected,
or (iii) subject to the Required Approvals, conflict with or result in a violation of any law, rule, regulation, order, judgment,
injunction, decree or other restriction of any court or governmental authority to which the Company or a Subsidiary is subject
(including federal and state securities laws and regulations), or by which any property or asset of the Company or a Subsidiary
is bound or affected; except in the case of each of clauses (ii) and (iii), such as could not have or reasonably be expected to
result in a Material Adverse Effect.

 

(e)
Filings, Consents and Approvals. Except as set forth on Schedule 3.1(e), the Company is not required to obtain any
consent, waiver, authorization or order of, give any notice to, or make any filing or registration with, any court or other federal,
state, local or other governmental authority or other Person in connection with the execution, delivery and performance by the
Company of the Transaction Documents, other than: (i) the filings required pursuant to Section 4.4 of this Agreement, (ii)
application(s) to each applicable Trading Market for the listing of the Conversion Shares and Warrant Shares for trading thereon
in the time and manner required thereby, and (iii) such filings as are required to be made under applicable state or federal securities
laws (collectively, the “Required Approvals”).

 

(f)
Issuance of the Securities. The Securities are duly authorized and, when issued and paid for in accordance with the applicable
Transaction Documents, will be duly and validly issued, fully paid and nonassessable, free and clear of all Liens imposed by the
Company. The Conversion Shares, when issued upon conversion of the Series E Shares, and the Warrant Shares, when issued in accordance
with the terms of the Warrants, will be validly issued, fully paid and nonassessable, free and clear of all Liens imposed by the
Company. The Company shall reserve from its duly authorized capital stock a number of shares of Common Stock issuable pursuant
to the Series E Shares and the Warrants equal to the amount set forth in Section 4.9.

 

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

 

(h)
SEC Reports; Financial Statements. The Company has filed all reports, schedules, forms, statements and other documents
required to be filed by the Company under the Securities Act and the Exchange Act, including pursuant to Section 13(a) or 15(d)
thereof, for the two years preceding the date hereof (or such shorter period as the Company was required by law or regulation
to file such material) (the foregoing materials, including the exhibits thereto and documents incorporated by reference therein,
being collectively referred to herein as the “SEC Reports”). As of their respective dates, the SEC Reports
complied in all material respects with the requirements of the Securities Act and the Exchange Act, as applicable, and none of
the SEC Reports, when filed, contained any untrue statement of a material fact or omitted to state a material fact required to
be stated therein or necessary in order to make the statements therein, in the light of the circumstances under which they were
made, not misleading. The financial statements of the Company included in the SEC Reports comply in all material respects with
applicable accounting requirements and the rules and regulations of the SEC with respect thereto as in effect at the time of filing.
Such financial statements have been prepared in accordance with United States generally accepted accounting principles applied
on a consistent basis during the periods involved (“GAAP”), except as may be otherwise specified in such financial
statements or the notes thereto and except that unaudited financial statements may not contain all footnotes required by GAAP,
and fairly present in all material respects the financial position of the Company and its consolidated Subsidiaries as of and
for the dates thereof and the results of operations and cash flows for the periods then ended, subject, in the case of unaudited
statements, to normal year-end audit adjustments.

 

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

 

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(j)
Litigation. Except as set forth in Schedule 3.1(j), there is no action, suit, notice of violation, proceeding or
investigation, inquiry or other similar proceeding of any federal or state governmental authority pending or, to the knowledge
of the Company, threatened against or affecting the Company, any Subsidiary or any of their respective properties before or by
any court, arbitrator, governmental or administrative agency or regulatory authority (federal, state, county, local or foreign)
(collectively, an “Action”) which (i) adversely affects or challenges the legality, validity or enforceability
of any of the Transaction Documents or the issuance of the Securities or (ii) could, if there were an unfavorable decision, have
or reasonably be expected to result in a Material Adverse Effect. The Company has no reason to believe that an Action will be
filed against it in the future. Except as set forth in Schedule 3.1(j), neither the Company nor any Subsidiary, nor any
director or officer thereof, is or has been the subject of any Action involving a claim of violation of or liability under federal
or state securities laws or a claim of breach of fiduciary duty. There has not been, and to the knowledge of the Company, there
is not pending or contemplated, any investigation by the SEC involving the Company or any current or former director or officer
of the Company. The SEC has not issued any stop order or other order suspending the effectiveness of any registration statement
filed by the Company or any Subsidiary under the Exchange Act or the Securities Act, and the Company has no reason to believe
it will do so in the future.

 

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

 

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(l)
Compliance. Except as set forth on Schedule 3.1(l), neither the Company nor any Subsidiary: (i) is in default under
or in violation of (and no event has occurred that has not been waived that, with notice or lapse of time or both, would result
in a default by the Company or any Subsidiary under), nor has the Company or any Subsidiary received notice of a claim that it
is in default under or that it is in violation of, any indenture, loan or credit agreement or any other agreement or instrument
to which it is a party or by which it or any of its properties is bound (whether or not such default or violation has been waived),
(ii) is in violation of any judgment, decree or order of any court, arbitrator or other governmental authority or (iii) is or
has been in violation of any statute, rule, ordinance or regulation of any governmental authority, including without limitation
all foreign, federal, state and local laws and regulations relating to taxes, securities, environmental protection, occupational
health and safety, product quality and safety, transportation, and employment and labor matters, except in each case as could
not have or reasonably be expected to result in a Material Adverse Effect.

 

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

 

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

 

(o)
Title to Assets. The Company and the Subsidiaries have good and marketable title in fee simple to all real property owned
by them and good and marketable title in all personal property owned by them that is material to the business of the Company and
the Subsidiaries, in each case free and clear of all Liens, except for (i) Liens as do not materially affect the value of such
property and do not materially interfere with the use made and proposed to be made of such property by the Company and the Subsidiaries,
and (ii) Liens for the payment of federal, state or other taxes, for which appropriate reserves have been made therefor in accordance
with GAAP and, the payment of which is neither delinquent nor subject to penalties. Any real property and facilities held under
lease by the Company and the Subsidiaries are held by them under valid, subsisting and enforceable leases with which the Company
and the Subsidiaries are in compliance.

 

(p)
Intellectual Property.

 

(i)
Except as set forth in Schedule 3.1(p), the Company owns or possesses or has the right to use pursuant to a valid and enforceable
written license, sublicense, agreement, or permission all Intellectual Property necessary for the operation of the business of
the Company as presently conducted, except in each case as could not have or reasonably be expected to result in a Material Adverse
Effect.

 

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(ii)
The Company has no knowledge that the Intellectual Property interferes with, infringe upon, misappropriate, or otherwise come
into conflict with, any Intellectual Property rights of third parties, and the Company has no knowledge that facts exist which
indicate a likelihood of the foregoing. The Company has not received any charge, complaint, claim, demand, or notice alleging
any such interference, infringement, misappropriation, or conflict (including any claim that the Company must license or refrain
from using any Intellectual Property rights of any third party). To the knowledge of the Company, no third party has interfered
with, infringed upon, misappropriated, or otherwise come into conflict with, any Intellectual Property rights of the Company,
except in each case as could not have or reasonably be expected to result in a Material Adverse Effect.

 

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

 

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

 

(s)
Sarbanes-Oxley; Internal Accounting Controls. Except as disclosed in Schedule 3.1(s), the Company and the Subsidiaries
are in compliance with any and all applicable requirements of the Sarbanes-Oxley Act of 2002 that are effective as of the date
hereof, and any and all applicable rules and regulations promulgated by the SEC thereunder that are effective as of the date hereof
and as of the applicable Closing. The Company and the Subsidiaries maintain a system of internal accounting controls as set forth
in the SEC Reports. The Company’s certifying officers have evaluated the effectiveness of the disclosure controls and procedures
of the Company and the Subsidiaries as of the end of the period covered by the most recently filed periodic report under the Exchange
Act (such date, the “Evaluation Date”). The Company presented in its most recently filed periodic report under
the Exchange Act the conclusions of the certifying officers about the effectiveness of the disclosure controls and procedures
based on their evaluations as of the Evaluation Date. Since the Evaluation Date, there have been no changes in the internal control
over financial reporting (as such term is defined in the Exchange Act) of the Company and its Subsidiaries that have materially
affected, or is reasonably likely to materially affect, the internal control over financial reporting of the Company and its Subsidiaries.

 

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

 

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

 

(v)
Registration Rights. Other than as set forth on Schedule 3.1(v), no Person has any right to cause the Company or
any Subsidiary to effect the registration under the Securities Act of any securities of the Company or any Subsidiary. The Company
shall not file any other resale registration statement prior to filing the registration statement required hereunder.

 

(w)
Listing and Maintenance Requirements. The Common Stock is registered pursuant to Section 12(b) or 12(g) of the Exchange
Act, and the Company has taken no action designed to, or which to its knowledge is likely to have the effect of, terminating the
registration of the Common Stock under the Exchange Act nor has the Company received any notification that the SEC is contemplating
terminating such registration. The Company has not, in the 12 months preceding the date hereof, received notice from any Trading
Market on which the Common Stock is or has been listed or quoted to the effect that the Company is not in compliance with the
listing or maintenance requirements of such Trading Market. The Company is, and has no reason to believe that it will not in the
foreseeable future continue to be, in compliance with all such listing and maintenance requirements. The Common Stock is currently
eligible for electronic transfer through the Depository Trust Company (“DTC”) or another established clearing
corporation and the Company is current in payment of the fees to the DTC (or such other established clearing corporation) in connection
with such electronic transfer. The Company is not subject to any “chill” issued by the DTC.

 

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

 

(y)
Disclosure. Except with respect to the material terms and conditions of the transactions contemplated by the Transaction
Documents, the Company confirms that neither it nor any other Person acting on its behalf has provided any of the Purchasers or
their agents or counsel with any information that it believes constitutes or might constitute material, non-public information
which is not otherwise disclosed in the SEC Reports. The Company understands and confirms that the Purchasers will rely on the
foregoing representation in effecting transactions in securities of the Company. All of the disclosure furnished by or on behalf
of the Company to the Purchasers regarding the Company and its Subsidiaries, their respective businesses and the transactions
contemplated hereby, including the Disclosure Schedules to this Agreement, is true and correct and does not contain any untrue
statement of a material fact or omit to state any material fact necessary in order to make the statements made therein, in light
of the circumstances under which they were made, not misleading. The press releases disseminated by the Company during the 12
months preceding the date of this Agreement do not contain any untrue statement of a material fact or omit to state a material
fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which
they were made and when made, not misleading. The Company acknowledges and agrees that no Purchaser makes or has made any representations
or warranties with respect to the transactions contemplated hereby other than those specifically set forth in Section 3.2
hereof.

 

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

 

(aa)
Indebtedness. Except as set forth on Schedule 3.1(aa), the Company has no knowledge of any facts or circumstances
which lead it to believe that it will file for reorganization or liquidation under the bankruptcy or reorganization laws of any
jurisdiction within one year from the Closing Date. Schedule 3.1(aa) set forth as of the time immediately following the
Closing hereof all outstanding Indebtedness of the Company or any Subsidiary. For the purposes of this Agreement, “Indebtedness”
means (x) any liabilities for borrowed money or amounts owed in excess of $50,000 (other than trade accounts payable incurred
in the ordinary course of business), (y) all guaranties, endorsements and other contingent obligations in respect of indebtedness
of others, whether or not the same are or should be reflected in the Company’s consolidated balance sheet (or the notes
thereto), except guaranties by endorsement of negotiable instruments for deposit or collection or similar transactions in the
ordinary course of business; and (z) the present value of any lease payments in excess of $50,000 due under leases required to
be capitalized in accordance with GAAP. Except as set forth on Schedule 3.1(aa), neither the Company nor any Subsidiary
is in default with respect to any Indebtedness.

 

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

 

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

 

(dd)
Accountants. The Company’s accounting firm is set forth in the SEC Reports. To the knowledge and belief of the Company,
such accounting firm (i) is a registered public accounting firm as required by the Exchange Act and (ii) has expressed its opinion
with respect to the financial statements included in the Company’s Annual Report on Form 10-K for the fiscal year ending
December 31, 2019.

 

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(ee)
Acknowledgment Regarding Purchasers’ Purchase of Securities. The Company acknowledges and agrees that each of the
Purchasers is acting solely in the capacity of an arm’s length purchaser with respect to the Transaction Documents and the
transactions contemplated thereby. The Company further acknowledges that no Purchaser is acting as a financial advisor or fiduciary
of the Company (or in any similar capacity) with respect to the Transaction Documents and the transactions contemplated thereby
and any advice given by any Purchaser or any of their respective representatives or agents in connection with the Transaction
Documents and the transactions contemplated thereby is merely incidental to the Purchasers’ purchase of the Securities.
The Company further represents to each Purchaser that the Company’s decision to enter into this Agreement and the other
Transaction Documents has been based solely on the independent evaluation of the transactions contemplated hereby by the Company
and its representatives.

 

(ff)
Acknowledgement Regarding Purchaser’s Trading Activity. Notwithstanding anything in this Agreement or elsewhere to
the contrary (except for Sections 3.2(f) and 4.12 hereof), it is understood and acknowledged by the Company that:
(i) no Purchaser has been asked by the Company to agree, nor has any Purchaser agreed, to desist from purchasing or selling, long
and/or short, securities of the Company, or “derivative” securities based on securities issued by the Company or to
hold the Securities for any specified term; (ii) past or future open market or other transactions by any Purchaser, specifically
including, without limitation, Short Sales or “derivative” transactions, before or after the closing of this or future
private placement transactions, may negatively impact the market price of the Company’s publicly-traded securities; (iii)
any Purchaser, and counter-parties in “derivative” transactions to which any such Purchaser is a party, directly or
indirectly, presently may have a “short” position in the Common Stock, and (iv) each Purchaser shall not be deemed
to have any affiliation with or control over any arm’s length counter-party in any “derivative” transaction.
The Company further understands and acknowledges that (y) one or more Purchasers may engage in hedging activities at various times
during the period that the Securities are outstanding, including, without limitation, during the periods that the value of the
Warrant Shares deliverable with respect to the Warrants are being determined, and (z) such hedging activities (if any) could reduce
the value of the existing shareholders’ equity interests in the Company at and after the time that the hedging activities
are being conducted. The Company acknowledges that such aforementioned hedging activities do not constitute a breach of any of
the Transaction Documents.

 

(gg)
Regulation M Compliance. The Company has not, and to its knowledge no one acting on its behalf has, (i) taken, directly
or indirectly, any action designed to cause or to result in the stabilization or manipulation of the price of the Common Stock
to facilitate the sale of the Securities, or (ii) paid or agreed to pay to any Person any compensation for soliciting another
to purchase the Securities or any other securities of the Company.

 

(hh)
Private Placement. Assuming the accuracy of the Purchasers’ representations and warranties set forth in Section
3.2, no registration under the Securities Act is required for the offer and sale of the Securities by the Company to the Purchasers
as contemplated hereby.

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

Section
3.2 Representations and Warranties of the Purchasers. Each Purchaser, for itself and for no other Purchaser, hereby represents
and warrants to the Company as follows which representations and warranties shall be true and correct as of the date hereof and
as of the Closing Date:

 

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

 

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(b)
Understandings or Arrangements. Such Purchaser is acquiring the Securities as principal for its own account and has no
direct or indirect arrangement or understandings with any other persons to distribute or regarding the distribution of such Securities
(this representation and warranty not limiting such Purchaser’s right to sell the Securities in compliance with applicable
federal and state securities laws). Such Purchaser is acquiring the Securities hereunder in the ordinary course of its business.
Such Purchaser understands that the Securities are “restricted securities” and have not been registered under the
Securities Act or any applicable state securities law and is acquiring such Securities as principal for its own account and not
with a view to or for distributing or reselling such Securities or any part thereof in violation of the Securities Act or any
applicable state securities law, has no present intention of distributing any of such Securities in violation of the Securities
Act or any applicable state securities law and has no direct or indirect arrangement or understandings with any other persons
to distribute or regarding the distribution of such Securities in violation of the Securities Act or any applicable state securities
law (this representation and warranty not limiting such Purchaser’s right to sell such Securities in compliance with applicable
federal and state securities laws).

 

(c)
Purchaser Status. At the time such Purchaser was offered the Securities, it was, and as of the date hereof it is, an accredited
investor within the meaning of Rule 501 under the Securities Act. No Purchaser is subject to any Disqualification Event, except
for a Disqualification Event covered by Rule 506(d)(2) or (d)(3).

 

(d)
Experience of Such Purchaser. Such Purchaser, either alone or together with its representatives, has such knowledge, sophistication
and experience in business and financial matters so as to be capable of evaluating the merits and risks of the prospective investment
in the Securities, and has so evaluated the merits and risks of such investment. Such Purchaser is able to bear the economic risk
of an investment in the Securities and, at the present time, is able to afford a complete loss of such investment.

 

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

 

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(f)
Certain Transactions and Confidentiality. Other than consummating the transactions contemplated hereunder, such Purchaser
has not, nor has any Person acting on behalf of or pursuant to any understanding with such Purchaser, directly or indirectly executed
any purchases or sales, including Short Sales, of the securities of the Company during the period commencing as of the time that
such Purchaser first received a term sheet (written or oral) from the Company or any other Person representing the Company setting
forth the material terms of the transactions contemplated hereunder and ending immediately prior to the execution hereof. Notwithstanding
the foregoing, in the case of a Purchaser that is a multi-managed investment vehicle whereby separate portfolio managers manage
separate portions of such Purchaser’s assets and the portfolio managers have no direct knowledge of the investment decisions
made by the portfolio managers managing other portions of such Purchaser’s assets, the representation set forth above shall
only apply with respect to the portion of assets managed by the portfolio manager that made the investment decision to purchase
the Securities covered by this Agreement. Other than to other Persons party to this Agreement or to such Purchaser’s representatives,
including, without limitation, its officers, directors, partners, legal and other advisors, employees, agents and Affiliates,
such Purchaser has maintained the confidentiality of all disclosures made to it in connection with this transaction (including
the existence and terms of this transaction). Notwithstanding the foregoing, for avoidance of doubt, nothing contained herein
shall constitute a representation or warranty, or preclude any actions, with respect to the identification of the availability
of, or securing of, available shares to borrow in order to effect Short Sales or similar transactions in the future.

 

The
Company acknowledges and agrees that the representations contained in this Section 3.2 shall not modify, amend or affect
such Purchaser’s right to rely on the Company’s representations and warranties contained in this Agreement or any
representations and warranties contained in any other Transaction Document or any other document or instrument executed and/or
delivered in connection with this Agreement or the consummation of the transaction contemplated hereby.

 

ARTICLE
IV

OTHER AGREEMENTS OF THE PARTIES

 

Section
4.1 Removal of Legends.

 

(a)
The Series E Shares, the Conversion Shares, the Warrants and Warrant Shares may only be disposed of in compliance with state and
federal securities laws. In connection with any transfer of the Series E Shares, the Conversion Shares, Warrants or Warrant Shares
other than pursuant to an effective registration statement or Rule 144, to the Company or to an Affiliate of a Purchaser or in
connection with a pledge as contemplated in Section 4.1(b), the Company may require the transferor to provide to the Company
an opinion of counsel selected by the transferor and reasonably acceptable to the Company at the cost of the Company, the form
and substance of which opinion shall be reasonably satisfactory to the Company, to the effect that such transfer does not require
registration of such transferred Series E Shares, Conversion Shares, Warrants or Warrant Shares under the Securities Act.

 

(b)
Each Purchaser agrees to the imprinting, so long as is required by this Section 4.1, of a legend on any of the Series E
Shares, Conversion Shares, the Warrants or Warrant Shares in substantially the following form:

 

NEITHER
THIS SECURITY NOR THE SECURITIES INTO WHICH THIS SECURITY IS EXERCISABLE HAVE BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE
COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE IN RELIANCE UPON AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT
OF 1933, AS AMENDED (THE “SECURITIES ACT”), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO,
THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS. THIS SECURITY AND
THE SECURITIES ISSUABLE UPON EXERCISE OF THIS SECURITY MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT WITH A REGISTERED
BROKER-DEALER OR OTHER LOAN WITH A FINANCIAL INSTITUTION THAT IS AN “ACCREDITED INVESTOR” AS DEFINED IN RULE 501(a)
UNDER THE SECURITIES ACT OR OTHER LOAN SECURED BY SUCH SECURITIES.

 

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The
Company acknowledges and agrees that a Purchaser may from time to time pledge pursuant to a bona fide margin agreement with a
registered broker-dealer or grant a security interest in some or all of the Series E Shares, a Warrant, the Conversion Shares
or Warrant Shares to a financial institution that is an “accredited investor” as defined in Rule 501(a) under the
Securities Act and who agrees to be bound by the provisions of this Agreement and, if required under the terms of such arrangement,
such Purchaser may transfer pledged or secured Series E Shares, a Warrant, Conversion Shares or Warrant Shares to the pledgees
or secured parties. Such a pledge or transfer would not be subject to approval of the Company and no legal opinion of legal counsel
of the pledgee, secured party or pledgor shall be required in connection therewith. Further, no notice shall be required of such
pledge. At the appropriate Purchaser’s expense, the Company will execute and deliver such reasonable documentation as a
pledgee or secured party of Series E Shares, a Warrant, Conversion Shares and Warrant Shares may reasonably request in connection
with a pledge or transfer of the Series E Shares, a Warrant, Conversion Shares or Warrant Shares.

 

(c)
Certificates evidencing the Series E Shares, the Conversion Shares and the Warrant Shares (or the Transfer Agent’s records
if held in book entry form) shall not contain any legend (including the legend set forth in Section 4.1(b) hereof): (i)
while a registration statement covering the resale of such securities is effective under the Securities Act (the “Effective
Date”), (ii) following any sale of such Series E Shares, Conversion Shares or Warrant Shares pursuant to Rule 144, (iii)
if such Series E Shares, Conversion Shares or Warrant Shares are eligible for sale under Rule 144, without the requirement for
the Company to be in compliance with the current public information required under Rule 144 as to such Series E Shares, Conversion
Shares or Warrant Shares and without volume or manner-of-sale restrictions or (iv) if such legend is not required under applicable
requirements of the Securities Act (including Sections 4(a)(1) and 4(a)(7) judicial interpretations and pronouncements issued
by the staff of the SEC). The Company shall, at its expense, cause its counsel to issue a legal opinion to the Transfer Agent
promptly after the Effective Date if required by the Transfer Agent to effect the removal of the legend hereunder. If any Series
E Share are converted or a Warrant is exercised at a time when there is an effective registration statement to cover the resale
of the Conversion Shares or the Warrant Shares, or if such Conversion Shares or Warrant Shares may be sold under Rule 144 and
the Company is then in compliance with the current public information required under Rule 144, or if the Conversion Shares or
Warrant Shares may be sold under Rule 144 without the requirement for the Company to be in compliance with the current public
information required under Rule 144 as to such Conversion Shares or Warrant Shares and without volume or manner-of-sale restrictions
or if such legend is not otherwise required under applicable requirements of the Securities Act (including Sections 4(a)(1) and
4(a)(7), judicial interpretations and pronouncements issued by the staff of the SEC) then such Conversion Shares or Warrant Shares
shall be issued or reissued free of all legends. The Company agrees that following the effective date of any registration statement
or at such time as such legend is no longer required under this Section 4.1(c), it will, no later than two Trading Days following
the delivery by a Purchaser to the Company or the Transfer Agent of a certificate representing restricted Series E Shares, Conversion
Shares or Warrant Shares, as applicable, issued with a restrictive legend (such second Trading Day, the “Legend Removal
Date”), deliver or cause to be delivered to such Purchaser a certificate representing such Series E Shares, Conversion
Shares or Warrant Shares that is free from all restrictive and other legends. The Company may not make any notation on its records
or give instructions to the Transfer Agent that enlarge the restrictions on transfer set forth in this Section 4.1. Certificates
for Series E Shares, Conversion Shares or Warrant Shares subject to legend removal hereunder shall be transmitted by the Transfer
Agent to the Purchaser by crediting the account of the Purchaser’s prime broker with the Depository Trust Company system
as directed by such Purchaser. The Company shall be responsible for any delays caused by its Transfer Agent.

 

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(d)
In addition to such Purchaser’s other available remedies, subject to Section 5.18(a) but not Section 5.18(b),
(i) the Company shall pay to a Purchaser, in cash, as partial liquidated damages and not as a penalty, for each $1,000 of the
Stated Value of the Series E Shares (as defined in the Series E COD) being converted or the value of the Warrant Shares for which
a Warrant is being exercised (based on the Warrant Exercise Price), $10 per Trading Day for each Trading Day after the Legend
Removal Date (increasing to $20 per Trading Day after the fifth Trading Day) until such certificate is delivered without a legend.
Nothing herein shall limit such Purchaser’s right to pursue actual damages for the Company’s failure to deliver certificates
representing any Securities as required by the Transaction Documents, and such Purchaser shall have the right to pursue all remedies
available to it at law or in equity including, without limitation, a decree of specific performance and/or injunctive relief,
and (ii) if after the Legend Removal Date such Purchaser purchases (in an open market transaction or otherwise) shares of Common
Stock to deliver in satisfaction of a sale by such Purchaser of all or any portion of the number of shares of Common Stock, or
a sale of a number of shares of Common Stock equal to all or any portion of the number of shares of Common Stock that such Purchaser
anticipated receiving from the Company without any restrictive legend, then, the Company shall pay to such Purchaser, in cash,
an amount equal to the excess of such Purchaser’s total purchase price (including brokerage commissions and other out-of-pocket
expenses, if any) for the shares of Common Stock so purchased (including brokerage commissions and other out-of-pocket expenses,
if any) over the product of (A) such number of Conversion Shares or Warrant Shares that the Company was required to deliver to
such Purchaser by the Legend Removal Date multiplied by (B) the highest closing sale price of the Common Stock on any Trading
Day during the period commencing on the date of the delivery by such Purchaser to the Company of the applicable Conversion Shares
or Warrant Shares (as the case may be) and ending on the date of such delivery and payment under this Section 4.1(d).

 

(e)
In the event a Purchaser shall request delivery of unlegended shares as described in this Section 4.1 and the Company is
required to deliver such unlegended shares, (i) it shall pay all fees and expenses associated with or required by the legend removal
and/or transfer including but not limited to legal fees, Transfer Agent fees and overnight delivery charges and taxes, if any,
imposed by any applicable government upon the issuance of Common Stock; and (ii) the Company may not refuse to deliver unlegended
shares based on any claim that such Purchaser or anyone associated or affiliated with such Purchaser has not complied with Purchaser’s
obligations under the Transaction Documents, or for any other reason, unless, an injunction or temporary restraining order from
a court, on notice, restraining and or enjoining delivery of such unlegended shares shall have been sought and obtained by the
Company and the Company has posted a surety bond for the benefit of such Purchaser in the amount of the greater of (i) 150% of
the amount of the aggregate purchase price of the Conversion Shares (based on the amount of the Stated Value of the Series E Shares
(as defined in the Series E COD) which was converted) and Warrant Shares (based on exercise price in effect upon exercise) which
is subject to the injunction or temporary restraining order, or (ii) the VWAP of the Common Stock on the Trading Day before the
issue date of the injunction multiplied by the number of unlegended shares to be subject to the injunction, which bond shall remain
in effect until the completion of the litigation of the dispute and the proceeds of which shall be payable to such Purchaser to
the extent Purchaser obtains judgment in Purchaser’s favor.

 

(f)
The Company shall (A) pay the reasonable legal fees of the Purchaser’s choice (in an amount not to exceed $500 per legal
opinion, and not more often than once per week per Purchaser) in connection with the conversion of the Series E Shares or the
Warrants, and (B) cause its attorneys to promptly provide any reliance opinion to the Transfer Agent.

 

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Section
4.2 Furnishing of Information.

 

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

 

(b)
At any time during the period commencing from the six month anniversary of the date hereof and ending at such time on the earlier
to occur that the Warrants are not outstanding, terminated or that all of the Warrant Shares (assuming cashless exercise) may
be sold without the requirement for the Company to be in compliance with Rule 144(c)(1) and otherwise without restriction or limitation
pursuant to Rule 144, if the Company (i) shall fail for any reason to satisfy the current public information requirement under
Rule 144(c) for a period of more than 30 consecutive days or (ii) has ever been an issuer described in Rule 144(i)(1)(i) or becomes
an issuer in the future, and the Company shall fail to satisfy any condition set forth in Rule 144(i)(2) for a period of more
than 30 consecutive days (a “Public Information Failure”) then, in addition to such Purchaser’s other
available remedies, the Company shall pay to a Purchaser, in cash, as partial liquidated damages and not as a penalty, by reason
of any such delay in or reduction of its ability to sell the Conversion Shares and/or Warrant Shares, an amount in cash equal
to two percent of the aggregate Stated Value (as defined in the Series E COD) of such Purchaser’s Series E Shares and/or
Warrant Exercise Price of such Purchaser’s Warrants on the day of a Public Information Failure and, subject to Section
5.18, on every 30th day (pro-rated for periods totaling less than thirty days) thereafter until the earlier of
(a) the date such Public Information Failure is cured and (b) such time that such public information is no longer required for
the Purchasers to transfer the Conversion Shares and/or Warrant Shares pursuant to Rule 144. Public Information Failure payments
shall be paid on the earlier of (i) the last day of the calendar month during which such Public Information Failure payments are
incurred and (ii) the second Trading Day after the event or failure giving rise to the Public Information Failure payments is
cured. In the event the Company fails to make Public Information Failure payments in a timely manner, such Public Information
Failure payments shall bear interest at the rate of one and one-half percent per month (prorated for partial months) until paid
in full. Nothing herein shall limit such Purchaser’s right to pursue actual damages for the Public Information Failure,
and such Purchaser shall have the right to pursue all remedies available to it at law or in equity including, without limitation,
a decree of specific performance and/or injunctive relief.

 

Section
4.3 Integration. The Company shall not sell, offer for sale or solicit offers to buy or otherwise negotiate in respect
of any security (as defined in Section 2(a)(1) of the Securities Act) that would be integrated with the offer or sale of the Securities
for purposes of the rules and regulations of any Trading Market such that it would require shareholder approval prior to the closing
of such other transaction unless shareholder approval is obtained before the closing of such subsequent transaction.

 

Section
4.4 Securities Laws Disclosure; Publicity. The Company shall file a Current Report on Form 8-K disclosing the material
terms of this Agreement, including the Transaction Documents as exhibits thereto, prior to 9:00 AM (New York Time) on the first
Trading Day after the Closing Date. From and after the filing of the Form 8-K as provided in the preceding sentence, the Company
represents to each Purchaser that it shall have publicly disclosed all material, non-public information delivered to each Purchaser
by the Company or any of its Subsidiaries, or any of their respective officers, directors, employees or agents in connection with
the transactions contemplated by the Transaction Documents. In addition, effective upon the issuance of such Form 8-K, the Company
acknowledges and agrees that any and all confidentiality or similar obligations under any agreement, whether written or oral,
between the Company, any of its Subsidiaries or any of their respective officers, directors, agents, employees or Affiliates on
the one hand, and any of the Purchasers or any of their Affiliates on the other hand, shall terminate. The Company and each Purchaser
shall consult with each other in issuing any press releases with respect to the transactions contemplated hereby, and neither
the Company nor any Purchaser shall issue any such press release nor otherwise make any such public statement without the prior
consent of the Company, with respect to any press release of any Purchaser, or without the prior consent of each Purchaser, with
respect to any press release of the Company, which consent shall not unreasonably be withheld or delayed, except if such disclosure
is required by law, in which case the disclosing party shall promptly provide the other party with prior notice of such public
statement or communication. Notwithstanding the foregoing, the Company shall not publicly disclose the name of any Purchaser,
or include the name of any Purchaser in any filing with the SEC or any regulatory agency or Trading Market, without the prior
written consent of such Purchaser, except (a) as required by the staff of the SEC in connection with the filing of final Transaction
Documents with the SEC and (b) to the extent such disclosure is required by law or Trading Market regulations, in which case the
Company shall provide the Purchasers with prior notice of such disclosure permitted under this clause (b).

 

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

 

Section
4.6 Non-Public Information. Except with respect to the material terms and conditions of the transactions contemplated by
the Transaction Documents, which shall be disclosed pursuant to Section 4.4, the Company covenants and agrees that neither
it, nor any other Person acting on its behalf will provide any Purchaser or its agents or counsel with any information that constitutes,
or the Company reasonably believes constitutes, material non-public information (including providing any Pre-Notice or Subsequent
Financing Notice under the Series E COD (as those terms are defined in the Series E COD)), unless prior thereto such Purchaser
shall have consented to the receipt of such information and agreed with the Company to keep such information confidential. Prior
to providing a Purchaser with any material non-public information (including any Pre-Notice or Subsequent Financing provided for
under the Series E COD (as those terms are defined in the Series E COD)), the Company shall provide the Purchaser with a consent
substantially in the form attached as Exhibit E (“Consent”) which shall not include any material non-public
information. The Company shall not provide the Purchaser with the material non-public information if the Purchaser does not execute
and return the Consent to the Company. To the extent that any notice provided pursuant to any Transaction Document or any other
communications made by the Company, or information provided, to any Purchaser constitutes, or contains, material, non-public information
regarding the Company or any Subsidiaries, and such information was provided without such Purchaser’s prior written consent,
the Company shall simultaneously file such notice or other material information with the SEC pursuant to a Current Report on Form
8-K. The Company understands and confirms that each Purchaser shall be relying on the foregoing covenant in effecting transactions
in securities of the Company. To the extent that the Company delivers any material, non-public information to a Purchaser without
such Purchaser’s consent, the Company hereby covenants and agrees that such Purchaser shall not have any duty of confidentiality
to the Company, any of its Subsidiaries, or any of their respective officers, directors, agents, employees or Affiliates, not
to trade on the basis of, such material, non-public information, provided that the Purchaser shall remain subject to applicable
law. The Company understands and confirms that each Purchaser shall be relying on the foregoing covenant in effecting transactions
in securities of the Company. In addition to any other remedies provided by this Agreement or other Transaction Documents, if
the Company provides any material, non-public information to the Purchasers without their prior written consent, and it fails
to immediately (no later than the next Trading Day) file a Form 8-K disclosing this material, non-public information, it shall,
subject to Section 5.18, pay each Purchasers as partial liquidated damages and not as a penalty a sum equal to $500 per
day for each $100,000 of each Purchaser’s Subscription Amount beginning with the day the information is disclosed to the
Purchaser and ending and including the day the Form 8-K disclosing this information is filed; provided that no such liquidated
damages shall be owed to any Purchaser not then holding Securities.

 

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Section
4.7 Use of Proceeds. The Company shall use the net proceeds from the sale of Securities hereunder at the Initial Closing
for working capital purposes and as otherwise provided on Schedule 4.7 and shall not use such proceeds: (a) for the satisfaction
of any other portion of the Company’s debt that is specified on Schedule 4.7, (b) for the redemption of any Common
Stock or Common Stock Equivalents, or (c) for the settlement of any outstanding litigation, (d) in violation of FCPA or OFAC regulations,
(e) to lend money, give credit, or make advances to any officers, directors, employees or affiliates of the Company or (f) for
the purchase of real estate.

 

Section
4.8 Indemnification of the Purchasers. Subject to the provisions of this Section 4.8, the Company will indemnify
and hold the Purchaser and its directors, officers, shareholders, members, partners, employees and agents (and any other Persons
with a functionally equivalent role of a Person holding such titles notwithstanding a lack of such title or any other title),
each Person who controls such Purchaser (within the meaning of Section 15 of the Securities Act and Section 20 of the Exchange
Act), and the directors, officers, shareholders, agents, members, partners or employees (and any other Persons with a functionally
equivalent role of a Person holding such titles notwithstanding a lack of such title or any other title) of such controlling persons
(each, a “Purchaser Party”) harmless from any and all losses, liabilities, obligations, claims, contingencies,
damages, costs and expenses, including all judgments, amounts paid in settlements, court costs and reasonable attorneys’
fees and costs of investigation (including local counsel, if retained) that any such Purchaser Party may suffer or incur as a
result of or relating to (a) any breach of any of the representations, warranties, covenants or agreements made by the Company
in this Agreement or in the other Transaction Documents or (b) any action instituted against the Purchaser Parties in any capacity,
or any of them or their respective Affiliates, by any shareholder of the Company who is not an Affiliate of such Purchaser Party,
with respect to any of the transactions contemplated by the Transaction Documents (unless such action is based upon a breach of
such Purchaser Party’s representations, warranties or covenants under the Transaction Documents or any agreements or understandings
such Purchaser Party may have with any such shareholder or any conduct by such Purchaser Party which constitutes willful misconduct
or gross negligence). If any action shall be brought against any Purchaser Party in respect of which indemnity may be sought pursuant
to this Agreement, such Purchaser Party shall promptly notify the Company in writing, and the Company shall have the right to
assume the defense thereof with counsel of its own choosing reasonably acceptable to the Purchaser Party. Any Purchaser Party
shall have the right to employ separate counsel in any such action and participate in the defense thereof, but the fees and expenses
of such counsel shall be at the expense of such Purchaser Party except to the extent that (i) the employment thereof has been
specifically authorized by the Company in writing, (ii) the Company has failed after a reasonable period of time to assume such
defense and to employ counsel or (iii) in such action there is, in the reasonable opinion of the Purchaser Party, a material conflict
on any material issue between the position of the Company and the position of such Purchaser Party, in which case the Company
shall be responsible for the reasonable fees and expenses of no more than one such separate counsel (in addition to local counsel,
if retained). The Company will not be liable to any Purchaser Party under this Agreement (y) for any settlement by a Purchaser
Party effected without the Company’s prior written consent, which shall not be unreasonably withheld or delayed; or (z)
to the extent, but only to the extent that a loss, claim, damage or liability is attributable to any Purchaser Party’s breach
of any of the representations, warranties, covenants or agreements made by such Purchaser Party in this Agreement or in the other
Transaction Documents. The Purchaser Parties shall have the right to settle any action against any of them by the payment of money
provided that they cannot agree to any equitable relief and the Company, its officers, directors and Affiliates receive unconditional
releases in customary form. The indemnification required by this Section 4.8 shall be made by periodic payments of the
amount thereof during the course of the investigation or defense, as and when bills are received or are incurred. The indemnity
agreements contained herein shall be in addition to any cause of action or similar right of any Purchaser Party against the Company
or others and any liabilities the Company may be subject to pursuant to law.

 

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Section
4.9 Reservation of Common Stock. On February 23, 2021, the stockholders of the Company approved the filing of n amendment
to the Company’s Articles of Incorporation to increase the number of authorized shares of Common Stock to 10,000,000,000
in order to provide the Company with a sufficient amount of shares to reserve an amount equal to or greater than three times the
number of shares of Common Stock issuable upon conversion of the Series E Shares and exercise of the Warrants. Pursuant to Rule
14c-2 under the Securities Exchange Act of 1934, as amended, we will distribute an information statement describing the approved
amendment to our stockholders prior to the closing and will file the amendment with the Secretary of State of Nevada 20 days after
the information statement is filed and mailed to stockholders. The amendment will become effective on filing. The initial reservation
amount shall be 2,675,885,714 shares for the Purchasers investing in the Initial Closing on a pro rata basis based on the Purchaser’s
Subscription Amount (subject to adjustment for stock splits and dividends, combinations and similar events). Upon the amendment
becoming effective, the Company shall execute and cause the Transfer Agent to execute a reservation letter in the form attached
as Exhibit F. In addition to any other remedies provided by this Agreement or other Transaction Documents, if the Company
at any time fails to meet this reservation of Common Stock requirement, it shall sell to the Company’s chief executive officer
(or such other officer as the board of directors may designate) for $100 a series of preferred stock which contains the power
to vote a number of votes equal to 51% of the number of votes eligible to vote at any special or annual meeting of the Company’s
shareholders (with the power to take action by written consent in lieu of a shareholders meeting) for the sole purpose of amending
the Company’s Charter to increase its authorized Common Stock, which such preferred stock shall be automatically cancelled
upon the effectuation of the resulting increased in the Company’s authorized shares, and if the Company at any time fails
to meet this reservation of Common Stock requirement within 45 days after written notice from the Purchaser, it shall, subject
to Section 5.18, pay the Purchaser as partial liquidated damages and not as a penalty a sum equal to $500 per day for each
$100,000 of the Purchaser’s Subscription Amount and the Company shall not enter into any agreement or file any amendment
to its Charter (including the filing of a Certificate of Designation) which conflicts with this Section 4.9 while the Series
E Shares and Warrants remain outstanding.

 

Section
4.10 Listing of Common Stock. The Company hereby agrees to use best efforts to maintain the listing or quotation of the
Common Stock on the Trading Market on which it is currently listed or quoted; provided, however, the Company shall
if it qualifies, list its Common Stock on a Trading Market which is a national securities exchange. The Company will then take
all action necessary to continue the listing and trading of its Common Stock on a Trading Market and will comply in all respects
with the Company’s reporting, filing and other obligations under the bylaws or rules of the Trading Market. The Company
agrees to maintain the eligibility of the Common Stock for electronic transfer through the DTC or another established clearing
corporation, including, without limitation, by timely payment of fees to the DTC or such other established clearing corporation
in connection with such electronic transfer.

 

Section
4.11 Equal Treatment of Purchasers. No consideration (including any modification of any Transaction Document) shall be
offered or paid to any Person to amend or consent to a waiver or modification of any provision of the Transaction Documents unless
the same consideration is also offered to all of the parties to the Transaction Documents. For clarification purposes, this provision
constitutes a separate right granted to each Purchaser by the Company and negotiated separately by each Purchaser, and is intended
for the Company to treat the Purchasers as a class and shall not in any way be construed as the Purchasers acting in concert or
as a group with respect to the purchase, disposition or voting of Securities or otherwise.

 

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Section
4.12 Certain Transactions and Confidentiality. Each Purchaser, severally and not jointly with the other Purchasers, covenants
that neither it nor any Affiliate acting on its behalf or pursuant to any understanding with it will execute any purchases or
sales, including Short Sales of any of the Company’s securities during the period commencing with the execution of this
Agreement and ending at such time that the transactions contemplated by this Agreement are first publicly announced pursuant to
the initial press release as described in Section 4.4. Each Purchaser, severally and not jointly with the other Purchasers,
covenants that until such time as the transactions contemplated by this Agreement are publicly disclosed by the Company pursuant
to the initial press release as described in Section 4.4, such Purchaser will maintain the confidentiality of the existence
and terms of this transaction and the information included in the Disclosure Schedules. Notwithstanding the foregoing and notwithstanding
anything contained in this Agreement to the contrary, the Company expressly acknowledges and agrees that (i) no Purchaser makes
any representation, warranty or covenant hereby that it will not engage in effecting transactions in any securities of the Company
after the time that the transactions contemplated by this Agreement are first publicly announced pursuant to the initial press
release as described in Section 4.4, (ii) no Purchaser shall be restricted or prohibited from effecting any transactions
in any securities of the Company in accordance with applicable securities laws from and after the time that the transactions contemplated
by this Agreement are first publicly announced pursuant to the initial press release as described in Section 4.4 and (iii)
no Purchaser shall have any duty of confidentiality or duty not to trade in the securities of the Company to the Company or its
Subsidiaries after the issuance of the initial press release as described in Section 4.4. Notwithstanding the foregoing,
in the case of a Purchaser that is a multi-managed investment vehicle whereby separate portfolio managers manage separate portions
of such Purchaser’s assets and the portfolio managers have no direct knowledge of the investment decisions made by the portfolio
managers managing other portions of such Purchaser’s assets, the covenant set forth above shall only apply with respect
to the portion of assets managed by the portfolio manager that made the investment decision to purchase the Securities covered
by this Agreement.

 

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

 

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

 

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

 

    	26

    	 

    

 

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

 

Section
4.17 D&O Insurance. The Company shall maintain director and officer insurance on behalf of the Company and its officers
and directors for 18 months after the Closing with respect to any losses, claims, damages, liabilities, costs and expense in connection
with any actual or threatened claim or proceeding that is based on, or arises out of their status as a director or officer of
the Company. The insurance policy shall cover SEC investigations for the Company and its officers and directors and provide for
two years of tail coverage.

 

Section
4.18 Subsequent Equity Sales.

 

(a)
From the date hereof until the date that is the 18 month anniversary of the Closing Date, the Company will not, without the consent
of the holders of a 66.6% of the outstanding Series E Shares, enter into any Equity Line of Credit or similar agreement, nor issue
nor agree to issue any common stock, floating or Variable Priced Equity Linked Instruments nor any of the foregoing or equity
with price reset rights (subject to adjustment for stock splits, distributions, dividends, recapitalizations and the like) (collectively,
the “Variable Rate Transaction”). For purposes hereof, “Equity Line of Credit” shall include
any transaction involving a written agreement between the Company and an investor or underwriter whereby the Company has the right
to “put” its securities to the investor or underwriter over an agreed period of time and at an agreed price or price
formula, and “Variable Priced Equity Linked Instruments” shall include: (A) any debt or equity securities which
are convertible into, exercisable or exchangeable for, or carry the right to receive additional shares of Common Stock either
(1) at any conversion, exercise or exchange rate or other price that is based upon and/or varies with the trading prices of or
quotations for Common Stock at any time after the initial issuance of such debt or equity security, or (2) with a fixed conversion,
exercise or exchange price that is subject to being reset at some future date at any time after the initial issuance of such debt
or equity security due to a change in the market price of the Company’s Common Stock since date of initial issuance, and
(B) any amortizing convertible security which amortizes prior to its maturity date, where the Company is required or has the option
to (or any investor in such transaction has the option to require the Company to) make such amortization payments in shares of
Common Stock which are valued at a price that is based upon and/or varies with the trading prices of or quotations for Common
Stock at any time after the initial issuance of such debt or equity security (whether or not such payments in stock are subject
to certain equity conditions). For purposes of determining the total consideration for a convertible instrument (including a right
to purchase equity of the Company) issued, subject to an original issue or similar discount or which principal amount is directly
or indirectly increased after issuance, the consideration will be deemed to be the actual cash amount received by the Company
in consideration of the original issuance of such convertible instrument.

 

(b)
From the date hereof until the second anniversary of the Closing Date, in the event that the Company issues or sells any Common
Stock or Common Stock Equivalents (excluding, with respect to convertible debt, those terms and conditions attributable to the
security’s debt character including interest and seniority over equity), if a Purchaser then holding Securities purchased
under this Agreement reasonably believes that any of the terms and conditions appurtenant to such issuance or sale are more favorable
to such investors than are the terms and conditions granted to the Purchasers hereunder, upon notice to the Company by such Purchaser
within five Trading Days after disclosure of such issuance or sale, the Company shall amend the terms of this transaction as to
such Purchaser only so as to give such Purchaser the benefit of such more favorable terms or conditions.

 

    	27

    	 

    

 

(c)
Notwithstanding the foregoing, this Section 4.18 shall not apply in respect of an Exempt Issuance. The Company shall provide
each Purchaser with notice of any such issuance or sale in the manner for disclosure of subsequent financings set forth in the
Series E COD.

 

Section
4.19 No Registration of Securities. Except as disclosed on Schedule 4.19, while the Series E Shares are outstanding,
the Company will not file any registration statements to register sales of Common Stock, including shares underlying any derivative
securities, unless a registration statement is then in effect for the resale by the Purchasers of the Conversion Shares.

 

Section
4.20 Capital Changes. Until the one year anniversary of the Closing Date, the Company shall not undertake a reverse or
forward stock split or reclassification of the Common Stock without the prior written consent of the Purchasers holding 66.6%
of the outstanding shares of Series E, provided that for avoidance of doubt this Section does not apply to the Company’s
amending its Certificate of Incorporation to increase its authorized shares of Common Stock or to the Company undertaking a reverse
stock split in order for it to meet, in part, the listing requirements of the NYSE American, the Nasdaq Capital Market, the Nasdaq
Global Market, the Nasdaq Global Select Market or the New York Stock Exchange.

 

Section
4.21 OTCQB. The Company shall use commercially reasonable efforts file an application to have its Common Stock listed on
the OTCQB Venture Market (“OTCQB”) by April 15, 2021 (“QB Deadline”).

 

ARTICLE
V

MISCELLANEOUS

 

Section
5.1 Termination. This Agreement may be terminated by any Purchaser, as to such Purchaser’s obligations hereunder
only and without any effect whatsoever on the obligations between the Company and the other Purchasers, by written notice to the
other parties, if the Closing has not been consummated on or before January 31, 2021; provided, however, that no
such termination will affect the right of any party to sue for any breach by any other party (or parties).

 

Section
5.2 Fees and Expenses. Except as expressly set forth below and in the Transaction Documents to the contrary, each party
shall pay the fees and expenses of its advisers, counsel, accountants and other experts, if any, and all other expenses incurred
by such party incident to the negotiation, preparation, execution, delivery and performance of this Agreement. The Company shall
pay all Transfer Agent fees (including, without limitation, any fees required for same-day processing of any instruction letter
delivered by the Company and any exercise notice delivered by a Purchaser), stamp taxes and other taxes and duties levied in connection
with the delivery of any Securities to the Purchasers. Upon the Closing, out of the proceeds of this transaction the Company shall
pay counsel for the Lead Investor a total of up to $5,000 in fees (which will be withheld from the funds in escrow).

 

Section
5.3 Entire Agreement. The Transaction Documents, together with the exhibits and schedules thereto, contain the entire understanding
of the parties with respect to the subject matter hereof and thereof and supersede all prior agreements and understandings, oral
or written, with respect to such matters, which the parties acknowledge have been merged into such documents, exhibits and schedules.

 

    	28

    	 

    

 

Section
5.4 Notices. Any and all notices or other communications or deliveries required or permitted to be provided hereunder shall
be in writing and shall be deemed given and effective on the earliest of: (a) the date of transmission, if such notice or communication
is delivered via facsimile or email attachment at the facsimile number or email address as set forth on the signature pages attached
hereto at or prior to 5:30 p.m. (New York City time) on a Trading Day, (b) the next Trading Day after the date of transmission,
if such notice or communication is delivered via facsimile or email attachment at the facsimile number or email address as set
forth on the signature pages attached hereto on a day that is not a Trading Day or later than 5:30 p.m. (New York City time) on
any Trading Day, (c) the second Trading Day following the date of mailing, if sent by U.S. nationally recognized overnight courier
service or (d) upon actual receipt by the party to whom such notice is required to be given. The address for such notices and
communications shall be as set forth on the signature pages attached hereto.

 

Section
5.5 Amendments; Waivers. Except as provided in the last sentence of this Section 5.5, no provision of this Agreement
may be waived, modified, supplemented or amended except in a written instrument signed, in the case of an amendment, by the Company
and the Purchaser or, in the case of a waiver, by the party against whom enforcement of any such waived provision is sought; provided,
that if any amendment, modification or waiver disproportionately and adversely impacts a Purchaser (or group of Purchasers), the
consent of such disproportionately impacted Purchaser (or group of Purchasers) shall also be required. No waiver of any default
with respect to any provision, condition or requirement of this Agreement shall be deemed to be a continuing waiver in the future
or a waiver of any subsequent default or a waiver of any other provision, condition or requirement hereof, nor shall any delay
or omission of any party to exercise any right hereunder in any manner impair the exercise of any such right. Any proposed amendment
or waiver that disproportionately, materially and adversely affects the rights and obligations of any Purchaser relative to the
comparable rights and obligations of the other Purchasers shall require the prior written consent of such adversely affected Purchaser,
Any amendment effected in accordance with accordance with this Section 5.5 shall be binding upon each Purchaser and holder
of Securities and the Company. In order to amend the definition of Exempt Issuance, the written consent of the Company and each
Purchaser must be obtained.

 

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

 

Section
5.7 Successors and Assigns. This Agreement shall be binding upon and inure to the benefit of the parties and their successors
and permitted assigns. The Company may not assign this Agreement or any rights or obligations hereunder without the prior written
consent of each Purchaser (other than by merger). Any Purchaser may assign any or all of its rights under this Agreement to any
Person to whom such Purchaser assigns or transfers any Securities, provided that such transferee agrees in writing to be bound,
with respect to the transferred Securities, by the provisions of the Transaction Documents that apply to the Purchasers.

 

Section
5.8 No Third-Party Beneficiaries. This Agreement is intended for the benefit of the parties hereto and their respective
successors and permitted assigns and is not for the benefit of, nor may any provision hereof be enforced by, any other Person,
except as otherwise set forth in Section 4.8 and this Section 5.8.

 

    	29

    	 

    

 

Section
5.9 Governing Law; Exclusive Jurisdiction; Attorneys’ Fees. All questions concerning the construction, validity,
enforcement and interpretation of the Transaction Documents except the Series E COD shall be governed by and construed and enforced
in accordance with the internal laws of the State of New York, without regard to the principles of conflicts of law thereof. All
questions concerning the construction, validity, enforcement and interpretation of the Series E COD shall be governed by and construed
and enforced in accordance with the internal laws of the State of Nevada, without regard to the principles of conflicts of law
thereof. Each party agrees that all Actions concerning the interpretations, enforcement and defense of the transactions contemplated
by this Agreement and any other Transaction Documents (whether brought against a party hereto or its respective affiliates, directors,
officers, shareholders, partners, members, employees or agents) shall be commenced exclusively in the state and federal courts
in New York County, New York. Each party hereby irrevocably submits to the exclusive jurisdiction of the state and federal courts
sitting in New York County, New York for the adjudication of any dispute hereunder or in connection herewith or with any transaction
contemplated hereby or discussed herein (including with respect to the enforcement of any of the Transaction Documents), and hereby
irrevocably waives, and agrees not to assert in any Action, any claim that it is not personally subject to the jurisdiction of
any such court, that such Action is improper or is an inconvenient venue for such Action. Each party hereby irrevocably waives
personal service of process and consents to process being served in any such Action by mailing a copy thereof via registered or
certified mail or overnight delivery (with evidence of delivery) to such party at the address in effect for notices to it under
this Agreement and agrees that such service shall constitute good and sufficient service of process and notice thereof. Nothing
contained herein shall be deemed to limit in any way any right to serve process in any other manner permitted by law. If any party
shall commence an Action to enforce any provisions of the Transaction Documents, then, in addition to the obligations of the Company
elsewhere in this Agreement, the prevailing party in such Action shall be reimbursed by the non-prevailing party for its reasonable
attorneys’ fees and other costs and expenses incurred with the investigation, preparation and prosecution of such Action.

 

Section
5.10 Survival. The representations and warranties contained herein shall survive the Closing and the delivery of the Securities.

 

Section
5.11 Execution. This Agreement may be executed in two or more counterparts, all of which when taken together shall be considered
one and the same agreement and shall become effective when counterparts have been signed by each party and delivered to each other
party, it being understood that the parties need not sign the same counterpart. In the event that any signature is delivered by
facsimile transmission or by e-mail delivery of a “.pdf” format data file, such signature shall create a valid and
binding obligation of the party executing (or on whose behalf such signature is executed) with the same force and effect as if
such facsimile or “.pdf” signature page were an original thereof.

 

Section
5.12 Severability. If any term, provision, covenant or restriction of this Agreement is held by a court of competent jurisdiction
to be invalid, illegal, void or unenforceable, the remainder of the terms, provisions, covenants and restrictions set forth herein
shall remain in full force and effect and shall in no way be affected, impaired or invalidated, and the parties hereto shall use
their commercially reasonable efforts to find and employ an alternative means to achieve the same or substantially the same result
as that contemplated by such term, provision, covenant or restriction. It is hereby stipulated and declared to be the intention
of the parties that they would have executed the remaining terms, provisions, covenants and restrictions without including any
of such that may be hereafter declared invalid, illegal, void or unenforceable.

 

Section
5.13 Rescission and Withdrawal Right. Notwithstanding anything to the contrary contained in (and without limiting any similar
provisions of) any of the other Transaction Documents, whenever any Purchaser exercises a right, election, demand or option under
a Transaction Document and the Company does not timely perform its related obligations within the periods therein provided, then
such Purchaser may rescind or withdraw, in its sole discretion from time to time upon written notice to the Company, any relevant
notice, demand or election in whole or in part without prejudice to its future actions and rights; provided, however, that in
the case of a rescission of an exercise of a Warrant, the applicable Purchaser shall be required to return any shares of Common
Stock subject to any such rescinded exercise notice concurrently with the return to such Purchaser of the aggregate exercise price
paid to the Company for such shares and the restoration of such Purchaser’s right to acquire such shares pursuant to such
Purchaser’s Warrant (including, issuance of a replacement warrant certificate evidencing such restored right).

 

    	30

    	 

    

 

Section
5.14 Replacement of Securities. If any certificate or instrument evidencing any Securities is mutilated, lost, stolen or
destroyed, the Company shall issue or cause to be issued in exchange and substitution for and upon cancellation thereof (in the
case of mutilation), or in lieu of and substitution therefor, a new certificate or instrument, but only upon receipt of evidence
reasonably satisfactory to the Company of such loss, theft or destruction without requiring the posting of any bond.

 

Section
5.15 Remedies. In addition to being entitled to exercise all rights provided herein or granted by law, including recovery
of damages, each of the Purchasers and the Company will be entitled to specific performance under the Transaction Documents. The
parties agree that monetary damages may not be adequate compensation for any loss incurred by reason of any breach of obligations
contained in the Transaction Documents and hereby agree to waive and not to assert in any Action for specific performance of any
such obligation the defense that a remedy at law would be adequate.

 

Section
5.16 Payment Set Aside. To the extent the Company makes a payment or payments to any Purchaser pursuant to any Transaction
Document or a Purchaser enforces or exercises its rights thereunder, and such payment or payments or the proceeds of such enforcement
or exercise or any part thereof are subsequently invalidated, declared to be fraudulent or preferential, set aside, recovered
from, disgorged by or are required to be refunded, repaid or otherwise restored to the Company, a trustee, receiver or any other
Person under any law (including, without limitation, any bankruptcy law, state or federal law, common law or equitable cause of
action), then to the extent of any such restoration the obligation or part thereof originally intended to be satisfied shall be
revived and continued in full force and effect as if such payment had not been made or such enforcement or setoff had not occurred.

 

Section
5.17 Independent Nature of Purchasers’ Obligations and Rights. The obligations of each Purchaser under any Transaction
Document are several and not joint with the obligations of any other Purchaser, and no Purchaser shall be responsible in any way
for the performance or non-performance of the obligations of any other Purchaser under any Transaction Document. Nothing contained
herein or in any other Transaction Document, and no action taken by any Purchaser pursuant hereto or thereto shall be deemed to
constitute the Purchasers as a partnership, an association, a joint venture or any other kind of entity, or create a presumption
that the Purchasers are in any way acting in concert or as a group with respect to such obligations or the transactions contemplated
by the Transaction Documents. Each Purchaser shall be entitled to independently protect and enforce its rights including, without
limitation, the rights arising out of this Agreement or out of the other Transaction Documents, and it shall not be necessary
for any other Purchaser to be joined as an additional party in any Proceeding for such purpose. Each Purchaser has been represented
by its own separate legal counsel in its review and negotiation of the Transaction Documents. The Company has elected to provide
all Purchasers with the same terms and Transaction Documents for the convenience of the Company and not because it was required
or requested to do so by any of the Purchasers. It is expressly understood and agreed that each provision contained in this Agreement
and in each other Transaction Document is between the Company and a Purchaser, solely, and not between the Company and the Purchasers
collectively and not between and among the Purchasers.

 

    	31

    	 

    

 

Section
5.18 Liquidated Damages.

 

(a)
The Company’s obligations to pay any partial liquidated damages or other amounts owing under the Transaction Documents is
a continuing obligation of the Company, provided, however, that, as to each Purchaser (or transferee thereof), such obligations
shall terminate when such Purchaser (or transferee thereof) ceases to hold the instrument or security pursuant to which such partial
liquidated damages or other amounts are due and payable for any reason including, but not limited to, conversion, exercise, redemption
or exchange and such Purchaser (or any transferee) has been paid such liquidated damages or other amounts that are owed to it.

 

(b)
Except as otherwise provided herein, the Company’s obligations to pay any partial liquidated damages or other amounts owing
under the Transaction Documents to any particular Purchaser shall be limited to the product of (i) the partial liquidated damages
or other amounts that would be owing under the Transaction Documents (excluding the effect of this Section 5.18(b)) multiplied
by (ii) a fraction (A) the numerator of which is the equal to the total of the Stated Value of the Series E Shares (as defined
in the Series E COD) then-held by such Purchaser plus the value of the Warrant Shares (based on the Warrant Exercise Price) then-issuable
to such Purchaser under such Purchaser’s Warrant and (B) the denominator of which is equal to such Purchaser’s Subscription
Amount.

 

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

 

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

 

Section
5.21 WAIVER OF JURY TRIAL. IN ANY ACTION, SUIT, OR PROCEEDING IN ANY JURISDICTION BROUGHT BY ANY PARTY AGAINST ANY OTHER
PARTY, THE PARTIES EACH KNOWINGLY AND INTENTIONALLY, TO THE GREATEST EXTENT PERMITTED BY APPLICABLE LAW, HEREBY ABSOLUTELY, UNCONDITIONALLY,
IRREVOCABLY AND EXPRESSLY WAIVE FOREVER TRIAL BY JURY.

 

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

 

(Signature
Pages Follow)

 

    	32

    	 

    

 

IN
WITNESS WHEREOF, the parties hereto have caused this Securities Purchase Agreement to be duly executed by their respective authorized
signatories as of the date first indicated above.

 

	Transportation
    and Logistics Systems, Inc.	 	Address
    for Notice:
	 	 	 	5500
    Military Trail, Suite 22-357
	By:	 	 	Jupiter,
Florida 33458
	Name:	John
Mercadante, Jr.	 	Email:
    john@primeefs.com
	Title:	Chief
    Executive Officer	 	 

 

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

 

Akabas
& Sproule 488 Madison Avenue, 11th Floor

New
York, New York 10022 Email: sakabas@akabas-sproule.com

 

[REMAINDER
OF PAGE INTENTIONALLY LEFT BLANK

SIGNATURE
PAGE FOR PURCHASER FOLLOWS]

 

    	 

    	 

    

 

PURCHASER
SIGNATURE PAGES TO SECURITIES PURCHASE AGREEMENT

 

IN
WITNESS WHEREOF, the undersigned have caused this Securities Purchase Agreement to be duly executed by their respective authorized
signatories as of the date first indicated above.

 

Name
of Purchaser: ___________________

Signature
of Authorized Signatory of Purchaser: _________________________________

Name
of Authorized Signatory: _______________________________________________

Title
of Authorized Signatory: ________________________________________________

Email
Address of Authorized Signatory: _________________________________________

Facsimile
Number of Authorized Signatory: ______________________________________

Address
for Notice to Purchaser:

 

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

 

Subscription
Amount: $_________________

 

Series
E Shares: __________________

 

Warrant
Shares: __________________

 

EIN
Number: _______________________

 

    	 

    	 

    

 

EXHIBIT
A

Form
of Amended and Restated Series E COD

 

    	 

    	 

    

 

EXHIBIT
B

Form
of Registration Rights Agreement

 

    	 

    	 

    

 

EXHIBIT
C

Form
of Warrant

 

    	 

    	 

    

  

EXHIBIT
D

Form
of Reserve Letter

Irrevocable
Transfer Agent Instructions

 

(see
attached)

 

    	 

    	 

    

  

EXHIBIT
E

Form
of Information Consent

 

Transportation
and Logistics Systems, Inc. (the “Company”) has information or notice of a proposed event (collectively, the “Information”)
that it is either required to provide you pursuant to that certain Securities Purchase Agreement dated __________ __, 2021 (“Agreement”)
between you and the Company or believes that you would be interested in obtaining.

 

You
acknowledge that receipt of the Information may restrict you from trading in the Company’s securities until the Information
is made public in accordance with the Agreement.

 

Please
respond in writing if you do or do not want to be provided with the Information. If the Company does not receive your response
within three business days, we will have the right to assume that you have chosen not to receive the Information and, if applicable,
waived your right to any subsequent offering rights and any other rights provided for under the Agreements that require notice,
for which this Information (including notice) is being given.

 

Please
sign below and check the appropriate box below.

 

	Sincerely,	 
	 	 
	TRANSPORTATION
    AND LOGISTICS, INC.	 
	 	 	 
	By:	 	 
	Name:	 	 
	Title:	Chief
    Executive Officer	 

 

___
Yes. Please provide we with the Information

 

___
No. Do not provide me with the Information

 

	 	 
	 	 

 

    	 

    	 

    

 

EXHIBIT
F

Form
of Series E Conversion Notice

 

NOTICE
OF CONVERSION

 

TO:
TRANSPORTATION AND LOGISTICS SYSTEMS,
INC.

 

(1)
The undersigned hereby elects to convert ___________ shares of Series E Convertible Preferred Stock of the Company into ___________
shares of common stock (“Conversion Shares”) of the Company pursuant to the terms of the Certificate of Designation,
Preferences, Rights And Limitations of Series E Convertible Preferred Stock.

 

(2)
Please issue a certificate or certificates representing said Conversion Shares in the name of the undersigned or in such other
name as is specified below:

 

	 	 	 

 

(3)
After giving effect to this Notice of Conversion, the undersigned will not have exceeded the Beneficial Ownership Limitation.

 

The
Conversion Shares shall be delivered to the following DWAC Account Number or by physical delivery of a certificate to:

 

	 	 	 
	 	 	 
	 	 	 
	 	 	 
	 	 	 

 

SIGNATURE
OF HOLDER

 

Name
of Investing Entity: _______________________________________________________________

Signature
of Authorized Signatory of Investing Entity: _________________________________________

Name
of Authorized Signatory: ___________________________________________________________

Title
of Authorized Signatory: ____________________________________________________________

Date:
________________________________________________________________________________

 

    	 

    	 

    

 

EXHIBIT
G

Form
of Escrow Agreement

 

    	 

    	 

    

 

COMPANY
DISCLOSURE SCHEDULES

 

to
the

 

SECURITIES
PURCHASE AGREEMENT

 

by
and among

 

TRANSPORTATION
AND LOGISTICS SYSTEMS, INC.

 

and

 

THE
PURCHASERS PARTY THERETO

 

Dated
as of ____________, 2021mnsb-ex43_11.htm

Exhibit 4.3

 

description of the registrant’s securities registered
under section 12 of the securities exchange act of 1934

As of December 31, 2020, MainStreet Bancshares, Inc. (the “Company”) had two classes of securities registered under Section 12 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”):  (1) our common stock, and (1) our depositary shares, each representing a 1/40th interest in a share of 7.50% Series A Fixed-Rate Non-Cumulative Perpetual Preferred Stock (“Series A Preferred Stock”).

The following description is a summary and does not purport to be complete. It is subject to and qualified in its entirety by reference to our Restated Articles of Incorporation, as amended (the “Articles of Incorporation”) and our Bylaws (the “Bylaws”), each of which is an exhibit to the Annual Report on Form 10-K of which this Exhibit 4.3 is a part. We encourage you to read our Articles of Incorporation, our Bylaws and applicable provisions of the Virginia Stock Corporation Act for additional information.

Authorized Capitalization

Our authorized capital stock consists of:

	
 
	
•
	
10,000,000 shares of common stock, par value $4.00 per share; and

	
 
	
•
	
2,000,000 shares of serial preferred stock, par value $1.00 per share.

Our Board of Directors may issue shares of our capital stock from time to time for such consideration as the Board may deem advisable without further shareholder approval, subject to the maximum number of authorized shares provided in our Articles of Incorporation. Our capital stock is non-withdrawable capital, is not an insurable account and is not insured by the FDIC.

description of the common stock

Dividend Rights

We may pay dividends, as declared from time to time by the Board of Directors, out of funds legally available for the payment of dividends, subject to certain restrictions imposed by federal and state laws. The holders of common stock are entitled to receive and share equally in any dividends as may be declared by the Board of Directors.

Voting Rights

In all elections of directors, each common shareholder has the right to cast one vote for each share of common stock owned by him or her and is entitled to vote for as many persons as there are directors to be elected. Our common shareholders do not have cumulative voting rights. On any other question to be determined by a vote of shares at any meeting of common shareholders, each shareholder shall be entitled to one vote for each share of common stock owned by him or her and entitled to vote. Unless otherwise required by the Virginia Stock Corporation Act or our Articles of Incorporation, one-third of the votes entitled to be cast on a matter by a voting group at a shareholder meeting shall constitute a quorum.

Preemptive Rights

Holders of our common stock have no preemptive rights.

Calls and Assessments

All common stock outstanding is fully paid and nonassessable.

 

 

Liquidation Rights

Upon our liquidation, dissolution or winding up, whether voluntary or involuntary, holders of our common stock are entitled to share ratably, after satisfaction in full of all of our liabilities (including deposit liabilities), in all of our remaining assets available for distribution. Holders of Series A Preferred Stock  have a priority over the holders of the Company’s common stock in the event of liquidation or dissolution.

Transfer Agent

American Stock Transfer & Trust Company, LLC serves as our registrar and transfer agent.

Provisions That May Affect Change of Control

Our Articles of Incorporation and the Virginia Stock Corporation Act contain certain provisions designed to enhance the ability of the Board of Directors to deal with attempts to acquire control of the Company. These provisions and the ability to set the voting rights, preferences and other terms thereof may be deemed to have an anti-takeover effect and may discourage takeover attempts which have not been approved by the Board (including takeovers which certain shareholders may deem to be in their best interest). To the extent that such takeover attempts are discouraged, temporary fluctuations in the market price of our common stock resulting from actual or rumored takeover attempts may be inhibited. These provisions also could discourage or make more difficult a merger, tender offer or proxy contest, even though such transaction may be favorable to the interests of shareholders, and could potentially adversely affect the market price of our common stock.

The following briefly summarizes protective provisions that are contained in our Articles of Incorporation or provided by the Virginia Stock Corporation Act. This summary is necessarily general and is not intended to be a complete description of all the features and consequences of those provisions and is qualified in its entirety by reference to our Articles of Incorporation and the Virginia Stock Corporation Act.

Supermajority Approval of Certain Actions. Our Articles of Incorporation require a supermajority of 80% or more of all votes entitled to be cast for shareholder approval of certain actions, unless at least two-thirds of the Board of Directors has approved and recommended the action. Items subject to this supermajority provision include amendments of our Articles of Incorporation, approval of plans of merger or share exchange, asset sales of all or substantially all of the Company’s assets other than in the regular course of business, and plans of dissolutions. If at least two-thirds of our Board of Directors has approved and recommended one of the above actions, a simple majority vote is required to approve the matter.

Staggered Board of Directors. According to our Bylaws, our Board of Directors must have a minimum of five members and a maximum of 15 members. Our Board consists of three groups each of which serves three-year terms, with the term of office of one group expiring each year. According to our Articles of Incorporation and Bylaws, a director may be removed with or without cause by the affirmative vote of a majority in interest of shareholders present at a meeting where a quorum is in attendance.

Authorized Shares of Preferred Stock.  See “Description of the Series A Preferred Stock” regarding preferences associated with the issued and outstanding Series A Preferred Stock. 

The Company is unable to determine the effects of any future issuance of a series of preferred stock on the rights of its shareholders until the Board of Directors determines the rights of the holders of such series. However, such effects might include: (i) a preference in the payment of dividends to holders of preferred stock; (ii) dilution of voting power in the unlikely event that the holders of shares of preferred stock are given voting rights; (iii) dilution of the equity interests and voting power of holders of common stock if the preferred stock is converted into common stock; (iv) a liquidation preference above the holders of common stock; and (v) prevention of mergers with or business combinations by the Company and discouragement of possible tender offers for shares of the Company’s common stock.

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Virginia Stock Corporation Act. Articles 14 and 14.1 of the Virginia Stock Corporation Act contain provisions regarding affiliated transactions and control share acquisitions. These provisions could have an anti-takeover effect, thereby reducing the control premium that might otherwise be reflected in the value of our common stock. Although Virginia corporations are permitted to opt out of these provisions, we have not done so. Below is a summary of the key provisions of these Articles. You should read the actual provisions of the Virginia Stock Corporation Act for a complete understanding of the restrictions that these provisions place on affiliated transactions and control share acquisitions.

Affiliated Transactions Statute. Article 14 of the Virginia Stock Corporation Act governs “affiliated transactions,” or transactions between a Virginia corporation and an “interested shareholder.” “Interested shareholders” are holders of more than 10% of any class of a corporation’s outstanding voting shares. Subject to certain exceptions discussed below, the affiliated transactions statute requires that, for three years following the date upon which any shareholder becomes an interested shareholder, any affiliated transaction must be approved by the affirmative vote of holders of two-thirds of the outstanding shares of the corporation entitled to vote, other than the shares beneficially owned by the interested shareholder, and by a majority (but not less than two) of the “disinterested directors.” The affiliated transactions statute defines a disinterested director as a member of a corporation’s board of directors who either (i) was a member before the later of January 1, 1988 or the date on which an interested shareholder became an interested shareholder or (ii) was recommended for election by, or was elected to fill a vacancy and received the affirmative vote of, a majority of the disinterested directors then on the corporation’s board of directors. At the expiration of the three-year period after a shareholder becomes an interested shareholder, these provisions require that any affiliated transaction be approved by the affirmative vote of the holders of two-thirds of the outstanding shares of the corporation entitled to vote, other than those beneficially owned by the interested shareholder.

The principal exceptions to the special voting requirement apply to affiliated transactions occurring after the three-year period has expired and require either that the affiliated transaction be approved by a majority of the corporation’s disinterested directors or that the transaction satisfy specific statutory fair price requirements. In general, the fair price requirements provide that the shareholders must receive for their shares the higher of: the highest per share price paid by the interested shareholder for his or its shares during the two-year period prior to becoming an interested shareholder, or the fair market value of the shares. The fair price requirements also require that, during the three years preceding the announcement of the proposed affiliated transaction, all required dividends have been paid and no special financial accommodations have been accorded the interested shareholder, unless approved by a majority of the disinterested directors.

Control Share Acquisitions Statute. With specific enumerated exceptions, Article 14.1 of the Virginia Stock Corporation Act applies to acquisitions of shares of a corporation which would result in an acquiring person’s ownership of the corporation’s shares entitled to be voted in the election of directors falling within any one of the following ranges: 20% to 33 1/3 %, 33 1/3% to 50% or 50% or more. Shares that are the subject of a control share acquisition will not be entitled to voting rights unless the holders of a majority of the “disinterested shares” vote at an annual or special meeting of shareholders of the corporation to accord the control shares with voting rights. Disinterested shares are those outstanding shares entitled to be voted that are not owned by the acquiring person or by officers and inside directors of the target company. Under specific circumstances, the control share acquisitions statute permits an acquiring person to call a special shareholders’ meeting for the purpose of considering granting voting rights to the holders of the control shares. As a condition to having this matter considered at either an annual or special meeting, the acquiring person must provide shareholders with detailed disclosures about his or its identity, the method and financing of the control share acquisition and any plans to engage in specific transactions with, or to make fundamental changes to, the corporation, its management or business. Under specific circumstances, the control share acquisitions statute grants dissenters’ rights to shareholders who vote against granting voting rights to the control shares. Among the acquisitions specifically excluded from the control share acquisitions statute are acquisitions which are a part of certain negotiated transactions to which the corporation is a party and which, in the case of mergers or share exchanges have been approved by the corporation’s shareholders under other provisions of the Virginia Stock Corporation Act.

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description of the preferred stock

Our Articles of Incorporation authorize our Board of Directors to divide the authorized preferred stock into and issue the same in series and, to the fullest extent permitted by law, to fix and determine the preferences, limitations and relative rights of the shares of any series so established, and to provide for the issuance thereof. Prior to the issuance of any share of a series of preferred stock, the Board of Directors shall establish such series by adopting an amendment to the Articles of Incorporation.

On September 15 and September 25, 2020, we issued an aggregate 1,150,000 depositary shares, each representing a 1/40th ownership interest in a share of 7.50% Series A Fixed-Rate Non-Cumulative Preferred Stock, par value $1.00 per share, with a liquidation preference of $1,000 per share of the Series A Preferred Stock (equivalent to $25 per depositary share) and an aggregate liquidation preference of $28,750,000, all of which were outstanding as of December 31, 2020.

DESCRIPTION OF THE SERIES A PREFERRED STOCK 

General 

The Series A Preferred Stock is a single series of our authorized preferred stock. We are offering 1,000,000 depositary shares (1,150,000 depositary shares if the underwriters exercise their over-allotment option in full), representing 25,000 shares of the Series A Preferred Stock (28,750 shares of the Series A Preferred Stock if the underwriters exercise their over-allotment option in full) in the aggregate by this prospectus supplement and the accompanying prospectus. Shares of the Series A Preferred Stock, upon issuance against full payment of the purchase price for the depositary shares, will be fully paid and nonassessable. The depositary will be the sole holder of shares of the Series A Preferred Stock. The holders of depositary shares will be required to exercise their proportional rights in the Series A Preferred Stock through the depositary, as described in the section entitled “Description of the Depositary Shares.” 

Shares of the Series A Preferred Stock rank senior to our common stock and at least equally with each other series of Series A Preferred Stock we may issue if provided for in the articles of amendment relating to such Series A Preferred Stock or otherwise (except for any senior stock that may be issued with the requisite consent of the holders of the Series A Preferred Stock and all other parity stock, if any), with respect to the payment of dividends and distributions of assets upon liquidation, dissolution or winding up of the Company. See “—Other Series A Preferred Stock” below. In addition, we will generally be able to pay dividends and distributions upon liquidation, dissolution or winding up only out of lawfully available assets for such payment (after satisfaction of all claims for indebtedness and other non-equity claims). Further, the Series A Preferred Stock may be fully subordinated to interests held by the U.S. government in the event that we enter into a receivership, insolvency, liquidation, or similar proceeding. 

The Series A Preferred Stock is not convertible into, or exchangeable for, shares of any other class or series of stock or other securities of the Company. The Series A Preferred Stock has no stated maturity and is not subject to any sinking fund or other obligation of the Company to redeem or repurchase the Series A Preferred Stock. 

We reserve the right to re-open this series and issue additional shares of the Series A Preferred Stock either through public or private sales at any time and from time to time, which may or may not involve additional depositary shares. The additional shares would form a single series with the Series A Preferred Stock. In addition, we may from time to time, without notice to or consent of holders of the Series A Preferred Stock or the depositary shares, issue additional shares of Series A Preferred Stock that rank equally with or junior to the Series A Preferred Stock. 

Dividends 

General. Dividends on the Series A Preferred Stock will not be cumulative. If our Board of Directors or a duly authorized committee of our Board of Directors does not declare a dividend on the Series A Preferred Stock in respect of a dividend period, then no dividend shall be deemed to have accrued for such dividend period, be payable on the applicable dividend payment date, or be cumulative, and we will have no obligation to pay any dividend for that dividend period, whether or not our Board of Directors or a duly authorized committee of our Board of Directors 

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declares a dividend on the Series A Preferred Stock for any subsequent dividend period. A dividend period is each period from and including a dividend payment date to but excluding the next dividend payment date, except that the initial dividend period commenced on and included the original issue date of the Series A Preferred Stock. Dividends payable on the Series A Preferred Stock will be computed on the basis of a 360-day year consisting of twelve 30-day months. 

Holders of the Series A Preferred Stock are entitled to receive, when, as, and if declared by our Board of Directors or a duly authorized committee of our Board of Directors out of assets legally available for the payment of dividends under Virginia law, non-cumulative cash dividends based on the liquidation preference of the Series A Preferred Stock at a rate equal to 7.50% per annum for each quarterly dividend period from the original issue date through the redemption date of the Series A Preferred Stock, if any. In the event that we issue additional shares of Series A Preferred Stock after the original issue date, dividends on such shares will accrue from the original issue date of such additional shares or any other date we specify at the time such additional shares are issued. 

If declared by our Board of Directors or a duly authorized committee of our Board of Directors, we will pay dividends on the Series A Preferred Stock quarterly in arrears, on March 30, June 30, September 30 and December 30 of each year, commencing on December 30, 2020 (each such date, a “dividend payment date”). If any date on which dividends would otherwise be payable is not a business day, then the dividend payment date will be the next business day without any adjustment to the amount of dividends paid. A business day means any weekday that is not a legal holiday in New York, New York, and that is not a day on which banking institutions in New York, New York, are closed. 

Dividends will be payable to holders of record of the Series A Preferred Stock as they appear on our stock register on the applicable record date, which shall be the 15th calendar day before the applicable dividend payment date, or such other record date, not exceeding 30 calendar days before the applicable payment date, as shall be fixed by our Board of Directors or a duly authorized committee of our Board of Directors. The corresponding record dates for the depositary shares will be the same as the record dates for the Series A Preferred Stock. 

Dollar amounts resulting from that calculation will be rounded to the nearest cent, with one-half cent being rounded upward. Dividends on the Series A Preferred Stock will cease to accrue on the redemption date, if any, as described below under “—Redemption,” unless we default in the payment of the redemption price of the shares of the Series A Preferred Stock called for redemption. 

The Company’s ability to pay dividends on the Series A Preferred Stock depends on the ability of MainStreet Bank to pay dividends to the Company. The ability of the Company and MainStreet Bank to pay dividends in the future is subject to bank regulatory requirements and capital adequacy rules and policies established by the Virginia Bureau of Financial Institutions and the Board of Governance of the Federal Reserve System (the “Federal Reserve”). In particular, dividends on the Series A Preferred Stock may not be declared, paid or set aside for payment if and to the extent such dividends would cause us to fail to comply with applicable laws and regulations, including capital adequacy rules applicable to us. The Federal Reserve also has the authority to prohibit or to limit the payment of dividends by a banking organization under its jurisdiction if, in the Federal Reserve’s opinion, the organization is engaged in or is about to engage in an unsafe or unsound practice. 

Priority of Dividends. The Series A Preferred Stock ranks junior as to payment of dividends to any class or series of our Series A Preferred Stock that we may issue in the future that is expressly stated to be senior to the Series A Preferred Stock. If at any time we do not pay, on the applicable dividend payment date, accrued dividends on any shares that rank senior in priority to the Series A Preferred Stock with respect to dividends, we may not pay any dividends on the Series A Preferred Stock or repurchase, redeem, or otherwise acquire for consideration any shares of Series A Preferred Stock until we have paid, or set aside for payment, the full amount of the unpaid dividends on the shares that rank senior in priority with respect to dividends that must, under the terms of such shares, be paid before we may pay dividends on, repurchase, redeem, or otherwise acquire for consideration, the Series A Preferred Stock. There are no other shares of Series A Preferred Stock issued and outstanding. 

So long as any share of Series A Preferred Stock remains outstanding, unless, in each case, the full dividends for the preceding dividend period on all outstanding shares of the Series A Preferred Stock have been paid in full or declared and a sum sufficient for the payment thereof has been set aside for payment: 

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no dividend shall be declared or paid or set aside for payment and no distribution shall be declared or made or set aside for payment on any junior stock (other than (i) a dividend payable solely in junior stock or (ii) any dividend in connection with the implementation of a shareholders’ rights plan, or the redemption or repurchase of any rights under any such plan); 

	
 
	
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no shares of junior stock shall be repurchased, redeemed or otherwise acquired for consideration by us, directly or indirectly (other than (i) as a result of a reclassification of junior stock for or into other junior stock, (ii) the exchange or conversion of one share of junior stock for or into another share of junior stock, (iii) through the use of the proceeds of a substantially contemporaneous sale of other shares of junior stock, (iv) purchases, redemptions or other acquisitions of shares of junior stock in connection with any employment contract, benefit plan or other similar arrangement with or for the benefit of employees, officers, directors or consultants, (v) purchases of shares of junior stock pursuant to a contractually binding requirement to buy junior stock existing prior to the preceding dividend period, including under a contractually binding stock repurchase plan, (vi) the purchase of fractional interests in shares of junior stock pursuant to the conversion or exchange provisions of such stock or the security being converted or exchanged, or (vii) the acquisition by us or any of our subsidiaries of record of ownership in junior stock for the beneficial ownership of any other persons (other than for the beneficial ownership by us or any of our subsidiaries), including as trustees or custodians), nor shall any monies be paid to or made available for a sinking fund for the redemption of any such securities by us; and 

	
 
	
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no shares of parity stock, if any, shall be repurchased, redeemed or otherwise acquired for consideration by us, directly or indirectly (other than (i) pursuant to pro rata offers to purchase all, or a pro rata portion, of the Series A Preferred Stock and such parity stock, if any, (ii) as a result of a reclassification of parity stock for or into other parity stock, (iii) the exchange or conversion of parity stock for or into other parity stock or junior stock, (iv) through the use of the proceeds of a substantially contemporaneous sale of other shares of parity stock, (v) purchases of shares of parity stock pursuant to a contractually binding requirement to buy parity stock existing prior to the preceding dividend period, including under a contractually binding stock repurchase plan, (vi) the purchase of fractional interests in shares of parity stock pursuant to the conversion or exchange provisions of such stock or the security being converted or exchanged, or (vii) the acquisition by us or any of our subsidiaries of record of ownership in parity stock for the beneficial ownership of any other persons (other than for the beneficial ownership by us or any of our subsidiaries), including as trustees or custodians), nor shall any monies be paid to or made available for a sinking fund for the redemption of any such securities by us. 

We will not declare or pay or set apart funds for the payment of dividends on any parity stock, unless we have paid or set apart funds for the payment of dividends on the Series A Preferred Stock. When dividends are not paid in full upon shares of Series A Preferred Stock and parity stock, if any, all dividends declared upon shares of Series A Preferred Stock and parity stock will be declared on a proportional basis so that the amount of dividends declared per share will bear to each other the same ratio that accrued dividends for the then-current dividend period per share on the Series A Preferred Stock, and accrued dividends, including any accumulations, if any, on parity stock, if any, bear to each other. 

As used herein, “junior stock” means our common stock and any other class or series of stock of the Company hereafter authorized over which the Series A Preferred Stock has preference or priority in the payment of dividends or in the distribution of assets on any liquidation, dissolution or winding up of the Company. As of the date of this prospectus supplement, our common stock is the only series of junior stock outstanding. 

As used herein, “parity stock” means any other class or series of stock of the Company that ranks on a parity with the Series A Preferred Stock with respect to the payment of dividends and distributions of assets upon liquidation, dissolution or winding up of the Company. As of the date of this prospectus supplement, there are no series of parity stock outstanding. See “—Other Series A Preferred Stock” below. 

As used herein, “senior stock” means any other class or series of stock of the Company ranking senior to the Series A Preferred Stock with respect to the payment of dividends and distributions of assets upon liquidation, dissolution or winding up of the Company. There are no series of senior stock outstanding. See “—Other Series A Preferred Stock” below. 

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Subject to the considerations described above, and not otherwise, dividends (payable in cash, stock or otherwise), as may be determined by our Board of Directors or a duly authorized committee of our Board of Directors, may be declared and paid on our common stock and any other stock ranking equally with or junior to the Series A Preferred Stock from time to time out of any assets legally available for such payment, and the holders of Series A Preferred Stock shall not be entitled to participate in any such dividend. 

Redemption 

The Series A Preferred Stock is not subject to any mandatory redemption, sinking fund or other similar provisions. Neither the holders of Series A Preferred Stock nor holders of depositary shares will have the right to require the redemption or repurchase of the Series A Preferred Stock. 

We may, at our option and subject to any required regulatory approval, redeem the Series A Preferred Stock (i) in whole or in part, from time to time, on any dividend payment date on or after September 30, 2025, or (ii) in whole, but not in part, at any time within 90 days following a “regulatory capital treatment event,” in either case at a redemption price equal to $1,000 per share (equivalent to $25 per depositary share), plus any declared and unpaid dividends on the shares of Series A Preferred Stock called for redemption up to the redemption date. 

A “regulatory capital treatment event” means the good faith determination by the Company that, as a result of any: 

	
 
	
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amendment to, or change (including any announced prospective change) in, the laws or regulations of the United States or any political subdivision of or in the United States that is enacted or becomes effective after the initial issuance of any share of Series A Preferred Stock; 

	
 
	
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proposed change in those laws or regulations that is announced or becomes effective after the initial issuance of any share of Series A Preferred Stock; or 

	
 
	
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official administrative decision or judicial decision or administrative action or other official pronouncement interpreting or applying those laws or regulations that is announced after the initial issuance of any share of Series A Preferred Stock; 

there is more than an insubstantial risk that the Company will not be entitled to treat the full liquidation value of the shares of Series A Preferred Stock then outstanding as “Tier 1 capital” (or its equivalent) for purposes of the Federal Reserve’s capital adequacy rules (or, as and if applicable, the capital adequacy rules of any successor federal banking regulator or agency), as then in effect and applicable, for as long as any share of Series A Preferred Stock is outstanding. 

We are a bank holding company regulated by the Federal Reserve. We treat the Series A Preferred Stock as “additional tier 1 capital” (or its equivalent) for purposes of the capital adequacy rules of the Federal Reserve (or, as and if applicable, the capital adequacy rules or regulations of any successor federal banking agency) applicable to us. 

If shares of the Series A Preferred Stock are to be redeemed, the notice of redemption shall be sent to the holders of record of the Series A Preferred Stock to be redeemed not less than 30 days nor more than 60 days prior to the date fixed for redemption thereof (provided that, if the depositary shares representing the Series A Preferred Stock are held in book-entry form through The Depository Trust Company (“DTC”), we may give such notice in any manner permitted by DTC). Each notice of redemption will include a statement setting forth: 

	
 
	
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the redemption date; 

	
 
	
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the number of shares of Series A Preferred Stock to be redeemed and, if fewer than all the shares held by the holder are to be redeemed, the number of shares of Series A Preferred Stock to be redeemed from the holder; 

	
 
	
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the redemption price; 

	
 
	
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the place or places where the certificates evidencing shares of Series A Preferred Stock, if applicable, are to be surrendered for payment of the redemption price; and 

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that dividends on the shares of Series A Preferred Stock to be redeemed will cease to accrue on the redemption date. 

Upon the redemption date, dividends will cease to accrue on shares of Series A Preferred Stock, and such shares of Series A Preferred Stock shall no longer be deemed outstanding and all rights of the holders of such shares will terminate, including the rights described under “—Voting Rights” below, except the right to receive the redemption price plus any declared and unpaid dividends on the shares of Series A Preferred Stock called for redemption up to the redemption date. See “Description of the Depositary Shares” for information about redemption of the depositary shares relating to the Series A Preferred Stock. 

In case of any redemption of only part of the shares of the Series A Preferred Stock at the time outstanding, the shares to be redeemed shall be selected pro rata or by lot. Subject to the provisions hereof, our Board of Directors or a duly authorized committee of our Board of Directors shall have full power and authority to prescribe the terms and conditions upon which shares of the Series A Preferred Stock shall be redeemed from time to time. 

Under the Federal Reserve’s capital adequacy rules applicable to bank holding companies, any redemption of the Series A Preferred Stock is subject to prior approval by the Federal Reserve. Any redemption of the Series A Preferred Stock is subject to our receipt of any required prior approval by the Federal Reserve and to the satisfaction of any conditions set forth in the capital adequacy rules of the Federal Reserve applicable to redemption of the Series A Preferred Stock. 

Neither the holders of the Series A Preferred Stock nor the holders of the related depositary shares have the right to require the redemption or repurchase of the Series A Preferred Stock. Any notice of redemption, once given, shall be irrevocable. 

Liquidation Rights 

In the event that we voluntarily or involuntarily liquidate, dissolve or wind-up our business and affairs, holders of the Series A Preferred Stock will be entitled to receive a liquidating distribution of $1,000 per share of the Series A Preferred Stock (equivalent to $25 per depositary share), plus any declared and unpaid dividends, without accumulation of any undeclared dividends, out of assets legally available for distribution to our shareholders, before we make any distribution of assets to the holders of our common stock or any other class or series of shares ranking junior to the Series A Preferred Stock. Holders of the Series A Preferred Stock will not be entitled to any other amounts from us after they have received their full liquidating distribution. 

In any such distribution, if the assets of the Company are not sufficient to pay the liquidation preferences plus declared and unpaid dividends in full to all holders of the Series A Preferred Stock and all holders of parity stock, if any, as to such distribution with the Series A Preferred Stock, the amounts paid to the holders of Series A Preferred Stock and the holders of parity stock, if any, will be paid pro rata in accordance with the respective aggregate liquidating distribution owed to those holders. If the liquidation preference plus declared and unpaid dividends has been paid in full to all holders of Series A Preferred Stock and parity stock, if any, the holders of our junior stock shall be entitled to receive all remaining assets of the Company according to their respective rights and preferences. 

In addition, we will generally be able to pay dividends and distributions upon liquidation, dissolution or winding up only out of lawfully available assets for such payment (after satisfaction of all claims for indebtedness and other non-equity claims). Further, the Series A Preferred Stock may be fully subordinated to interests held by the U.S. government in the event that we enter into a receivership, insolvency, liquidation, or similar proceeding. 

Our merger or consolidation with any other entity, including a merger or consolidation in which the holders of Series A Preferred Stock receive cash, securities or property for their shares, or the sale, lease or exchange of all or substantially all of the assets of the Company for cash, securities or other property, shall not constitute a liquidation, dissolution or winding up of the Company. 

Because we are a holding company, our rights and the rights of our creditors and our shareholders, including the holders of the Series A Preferred Stock, to participate in the assets of any subsidiary, including MainStreet Bank, 

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upon that subsidiary’s liquidation or recapitalization may be subject to the prior claims of that subsidiary’s creditors, including deposits, except to the extent that we are a creditor with recognized claims against the subsidiary. 

Voting Rights 

Except as provided below, the holders of the Series A Preferred Stock will have no voting rights. 

Right to Elect Two Directors upon Nonpayment of Dividends. If we fail to pay, or declare and set apart for payment, dividends on outstanding shares of the Series A Preferred Stock for six quarterly dividend periods, whether or not consecutive (a “Nonpayment”), the number of members of our Board of Directors shall be increased by two, and the holders of outstanding shares of the Series A Preferred Stock, voting as a single class with the holders of shares of any equally ranked series of Series A Preferred Stock for which dividends have not been paid and upon which voting rights have been conferred and are exercisable (“Voting Parity Stock”) shall be entitled to vote for the election of two additional members of the Board of Directors (the “Series A Preferred Stock Directors”), with each series or class having a number of votes proportionate to the aggregate liquidation preference of the outstanding shares of such class or series. At any time after such voting power has vested, the holders of the Series A Preferred Stock shall have the right, voting as a single class together with the holders of Voting Parity Stock (if any), to elect two Series A Preferred Stock Directors at a special meeting called upon the written request of the holders of record of at least 20% of the outstanding shares of the Series A Preferred Stock or any series of Voting Parity Stock (unless such request is received by us less than 90 days before the date publicly announced for our next annual meeting or fixed for a special meeting of shareholders, in which event such election shall be held at such upcoming annual or special meeting of the shareholders); provided that at no time shall our Board of Directors include more than two Series A Preferred Stock Directors, and provided further that any election of Series A Preferred Stock Directors would not cause us to violate the corporate governance requirements of the Nasdaq Capital Market (or any other exchange on which our securities may be listed) regarding the independence of directors or other similar requirements. Notice for any such special meeting will be given in a similar manner to that provided in the Company’s Bylaws for a special meeting of shareholders of the Company. 

The Series A Preferred Stock Directors elected at any such special meeting or annual meeting will hold office until our next annual meeting of shareholders unless their term has been previously terminated as described below. In case any vacancy occurs among the Series A Preferred Stock Directors, a successor will be elected by the Board of Directors to serve until the next annual meeting of shareholders upon the nomination by the remaining Series A Preferred Stock Director or, if no Series A Preferred Stock Director remains in office, by the vote of the holders of record of the outstanding shares of Series A Preferred Stock and any series of Voting Parity Stock, voting as a single class, with each series or class having a number of votes proportionate to the aggregate liquidation preference of the outstanding shares of such class or series. Each of the two Series A Preferred Stock Directors shall each be entitled to one vote per director on any matter. 

Upon payment in full of continuous noncumulative dividends on the Series A Preferred Stock for a period of one year following a Nonpayment, the terms of the two Series A Preferred Stock Directors elected as set forth above shall immediately terminate, the number of directors shall be reduced by two, and the voting rights described above shall cease, subject to revesting of such voting rights in the event of any future Nonpayment. In addition, if and when the rights of holders of Series A Preferred Stock terminate for any reason, including under circumstances described above under “— Redemption,” such voting rights shall terminate along with the other rights (except, if applicable, the right to receive the redemption price plus any declared and unpaid dividends), and the terms of any Series A Preferred Stock Directors shall terminate automatically and the number of directors shall be reduced by two, assuming that the rights of holders of such Voting Parity Stock have similarly terminated. 

Under the regulations of the Federal Reserve, if the holders of any series of Series A Preferred Stock are or become entitled to vote separately for the election of directors as a class, such series, along with any other holders of stock that are entitled to vote for the election of directors with that series, will be deemed a class of voting securities. A company holding 25% or more of that class, or less if it otherwise exercises a “controlling influence” over us, will be subject to regulation as a bank holding company under the Bank Holding Company Act of 1956, as amended (the “BHC Act”). In addition, at the time the series is deemed a class of voting securities, any other bank holding company will be required to obtain the prior approval of the Federal Reserve under the BHC Act to acquire or retain more than 5% of that class. Any other person (other than a bank holding company) will be required to obtain the non-objection 

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of the Federal Reserve under the Change in Bank Control Act of 1978, as amended, to acquire or retain 10% or more of that class. 

Other Voting Rights. So long as any shares of Series A Preferred Stock remain outstanding, the affirmative vote or consent of the holders of at least two-thirds of all outstanding shares of the Series A Preferred Stock, voting separately as a class, shall be required to: 

	
 
	
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authorize or increase the authorized amount of, or issue shares of, any class or series of senior stock, or issue any obligation or security convertible into or evidencing the right to purchase any such shares of senior stock; 

	
 
	
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amend the provisions of our Articles of Incorporation, so as to adversely affect the powers, preferences, privileges or rights of the Series A Preferred Stock, taken as a whole; provided, however, that any increase in the amount of the authorized or issued Series A Preferred Stock or authorized common stock or Series A Preferred Stock or the creation and issuance, or an increase in the authorized or issued amount, of other series of Series A Preferred Stock ranking equally with or junior to the Series A Preferred Stock with respect to the payment of dividends or the distribution of assets upon liquidation, dissolution or winding up of the Company will not be deemed to adversely affect the powers, preferences, privileges or rights of the Series A Preferred Stock; or 

	
 
	
•
	
consummate a binding share-exchange or reclassification involving the Series A Preferred Stock, or a merger or consolidation with or into another entity unless (i) the shares of the Series A Preferred Stock remain outstanding or are converted into or exchanged for preferred securities of the surviving entity and (ii) the shares of the remaining Series A Preferred Stock or the new preferred securities of the surviving entity have terms that are not materially less favorable than the Series A Preferred Stock. 

The foregoing voting provisions will not apply if, at or prior to the time when the act with respect to which such vote would otherwise be required shall be effected, all outstanding shares of Series A Preferred Stock shall have been redeemed. 

Voting Rights under Virginia Law. Except as expressly set forth in the Articles of Amendment, the Virginia Stock Corporation Act does not provide any additional voting rights to the holders of the Series A Preferred Stock. Therefore, under the Virginia Stock Corporation Act, the holders of the Series A Preferred Stock will only have those voting rights set forth above under “—Voting Rights.” 

Preemptive and Conversion Rights 

The holders of the Series A Preferred Stock do not have any preemptive or conversion rights. 

Other Series A Preferred Stock 

Our Articles of Incorporation authorize our Board of Directors to create and provide for the issuance of one or more series of Series A Preferred Stock without the approval of our shareholders. Our Board of Directors can also determine the terms, including the designations, powers, preferences and rights (including conversion, voting and other rights) and the qualifications, limitations or restrictions, of any such series of Series A Preferred Stock. Currently, 2,000,000 shares of our capital stock are classified as preferred stock under our Articles of Incorporation. 

Depositary Agent, Transfer Agent and Registrar 

American Stock Transfer & Trust Company, LLC is the depositary, transfer agent and registrar for the Series A Preferred Stock. We may, in our sole discretion, remove the depositary in accordance with the agreement between 

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us and the depositary; provided that we will appoint a successor depositary who will accept such appointment prior to the effectiveness of its removal. 

Information Rights 

During any period in which the Company is not subject to Section 13 or 15(d) of the Exchange Act and any shares of the Series A Preferred Stock are outstanding, we will use our best efforts to (i) make available on our website, at www.mstreetbank.com, current information specified in Rule 144(c)(2) under the Securities Act of 1933 and Rule 15c2-11(a)(5)(i) to (xiv) and (xvi) under the Exchange Act; and (ii) promptly, upon request, supply such information to any holder or prospective holder of Series A Preferred Stock. 

DESCRIPTION OF THE DEPOSITARY SHARES 

General 

We are issuing depositary shares representing proportional fractional interests in shares of the Series A Preferred Stock. Each depositary share represents a 1/40th interest in a share of the Series A Preferred Stock, and will be evidenced by depositary receipts. We will deposit the underlying shares of the Series A Preferred Stock with a depositary pursuant to a deposit agreement among us, American Stock Transfer & Trust Company, LLC and the holders from time to time of the depositary receipts evidencing the depositary shares (the “Deposit Agreement”). Subject to the terms of the Deposit Agreement, each holder of a depositary share will be entitled, through the depositary, in proportion to the applicable fraction of a share of Series A Preferred Stock represented by such depositary share, to all the rights and preferences of the Series A Preferred Stock represented thereby, including dividend, voting, redemption and liquidation rights. 

References herein to “holders” of depositary shares mean those persons who own depositary shares registered in their own names on the books that we or the depositary maintain for this purpose, and not indirect holders who own beneficial interests in depositary shares registered in street name or issued in book-entry form through DTC. Please review the special considerations that apply to indirect holders described in the section entitled “Book-Entry Issuance.” 

American Stock Transfer & Trust Company, LLC is the depositary, transfer agent and registrar for the depositary shares. 

Dividends and Other Distributions 

Each dividend payable on a depositary share will be in an amount equal to 1/40th of the dividend declared and payable on the related share of the Series A Preferred Stock. 

The depositary will distribute any cash dividends or other cash distributions received in respect of the deposited Series A Preferred Stock to the record holders of depositary shares relating to the underlying Series A Preferred Stock in proportion to the number of depositary shares held by such holders. If we make a distribution other than in cash, the depositary will distribute any property received by it to the record holders of depositary shares entitled to those distributions, unless it determines that it is not feasible to make a distribution. In that event, the depositary may, with our approval, sell the property and distribute the net proceeds from the sale to the record holders of the depositary shares. 

Record dates for the payment of dividends and other matters relating to the depositary shares are the same as the corresponding record dates for the Series A Preferred Stock. 

The amounts distributed to holders of depositary shares will be reduced by any amounts required to be withheld by the depositary or by us on account of taxes or other governmental charges. 

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Redemption of Depositary Shares 

If we redeem the Series A Preferred Stock represented by the depositary shares, the depositary shares will be redeemed from the proceeds received by the depositary resulting from the redemption of the Series A Preferred Stock held by the depositary. The redemption price per depositary share is expected to be equal to 1/40th of the redemption price per share payable with respect to the Series A Preferred Stock (or $25 per depositary share), plus any declared and unpaid dividends, without accumulation of any undeclared dividends. 

Whenever we redeem shares of Series A Preferred Stock held by the depositary, the depositary will redeem, as of the same redemption date, the number of depositary shares representing shares of Series A Preferred Stock so redeemed. If fewer than all of the outstanding depositary shares are redeemed, the depositary will select the depositary shares to be redeemed pro rata or by lot, or in such other manner that the depositary determines to be fair and equitable. The depositary will send notice of redemption to record holders of the depositary receipts not less than 30 and not more than 60 days prior to the date fixed for redemption of the Series A Preferred Stock and the related depositary shares (provided that, if the depositary shares representing the Series A Preferred Stock are held in book-entry form through DTC, the depositary may give such notice in any manner permitted by DTC). 

Voting the Series A Preferred Stock 

Because each depositary share represents a 1/40th interest in a share of the Series A Preferred Stock, holders of depositary receipts will be entitled to 1/40th of a vote per depositary share under those limited circumstances in which holders of the Series A Preferred Stock are entitled to a vote, as described above in “Description of the Series A Preferred Stock—Voting Rights.” 

When the depositary receives notice of any meeting at which the holders of the Series A Preferred Stock are entitled to vote, the depositary will send the information contained in the notice to the record holders of the depositary shares relating to the Series A Preferred Stock. Each record holder of the depositary shares on the record date, which will be the same date as the record date for the Series A Preferred Stock, may instruct the depositary to vote the amount of the Series A Preferred Stock represented by the holder’s depositary shares. Insofar as practicable, the depositary will vote the amount of the Series A Preferred Stock represented by depositary shares in accordance with the instructions it receives. We will agree to take all reasonable actions that the depositary determines are necessary to enable the depositary to vote as instructed. If the depositary does not receive specific instructions from the holders of any depositary shares representing the Series A Preferred Stock, it will not vote the amount of the Series A Preferred Stock represented by such depositary shares. 

Listing of Depositary Shares 

The depositary shares are listed on the Nasdaq Capital Market under the symbol “MNSBP.” 

Withdrawal of Series A Preferred Stock 

Any holder of depositary shares may receive the number of whole shares of Series A Preferred Stock and any money or other property represented by the depositary shares held by such holder after surrendering the depositary receipts representing such depositary shares to the depositary, paying any taxes, governmental charges and fees provided for in the Deposit Agreement and complying with any other requirement of the Deposit Agreement. Holders of depositary shares making these withdrawals will be entitled to receive such whole shares of Series A Preferred Stock, but holders of such whole shares of Series A Preferred Stock will not be entitled to deposit that Series A Preferred Stock under the Deposit Agreement or to receive depositary shares for such Series A Preferred Stock after withdrawal. If the depositary shares surrendered by the holder in connection with withdrawal exceed the number of depositary shares that represent the number of whole shares of Series A Preferred Stock to be withdrawn, the depositary will deliver to that holder at the same time a new depositary receipt evidencing the excess number of depositary shares. 

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Amendment and Termination of the Deposit Agreement 

We may amend the form of depositary receipt evidencing the depositary shares and any provision of the Deposit Agreement at any time and from time to time by agreement with the depositary without the consent of the holders of depositary receipts. However, any amendment that would materially and adversely alter the rights of the holders of depositary receipts or that would be materially and adversely inconsistent with the rights granted to the holders of the Series A Preferred Stock will not be effective unless the holders of at least a majority of the affected depositary shares then outstanding approve the amendment. We will make no amendment that impairs the right of any holder of depositary shares, as described above under “—Withdrawal of Series A Preferred Stock,” to receive shares of Series A Preferred Stock and any money or other property represented by those depositary shares, except in order to comply with mandatory provisions of applicable law. Holders who retain or acquire their depositary receipts after an amendment becomes effective will be deemed to have agreed to the amendment and will be bound by the amended Deposit Agreement. 

The Deposit Agreement will automatically terminate if: 

	
 
	
•
	
all outstanding depositary shares have been redeemed; or 

	
 
	
•
	
a final distribution in respect of the Series A Preferred Stock has been made to the holders of depositary receipts in connection with any liquidation, dissolution or winding up of the Company. 

We may terminate the Deposit Agreement at any time upon not less than 35 days’ prior notice to the depositary, and the depositary will give notice of that termination to the record holders of all outstanding depositary shares not less than 30 days before the termination date. In the event of such termination, the depositary will deliver or make available for delivery to holders of depositary receipts, upon surrender of such depositary receipts, the number of whole or fractional shares of Series A Preferred Stock as are represented by the depositary shares evidenced by such depositary receipts. 

Upon termination of the Deposit Agreement, the depositary will discontinue the transfer of depositary receipts, will suspend the distribution of dividends and will not give any further notices (other than notice of such termination) or perform any further acts under the Deposit Agreement, except that the depositary will continue to collect dividends and other distributions pertaining to Series A Preferred Stock and will continue to deliver Series A Preferred Stock certificates together with such dividends and distributions. 

At any time after the expiration of three years from the date of termination, the depositary may sell the Series A Preferred Stock and hold the proceeds of such sale, without interest, for the benefit of the holders of depositary receipts who have not then surrendered their depositary receipts. After making such sale, the depositary will be discharged from all obligations under the Deposit Agreement, except to account for such proceeds. 

Charges of Depositary 

We will pay the charges of the depositary in connection with any redemption of the Series A Preferred Stock at our option and all withdrawals of Series A Preferred Stock by holders of depositary shares as previously agreed between us and the depositary. We will also pay all taxes and governmental charges arising solely from the existence of the Deposit Agreement. Holders of depositary shares will pay all other transfer fees, taxes and governmental charges and, such other charges as are expressly provided in the Deposit Agreement to be for their accounts. All other charges and expenses of the depositary, the registrar, and the transfer agent incident to the performance of their respective obligations arising from the depositary arrangements will be paid by us. 

Resignation and Removal of Depositary 

The depositary may resign at any time by delivering to us notice of its resignation and we may at any time remove the depositary, with any such resignation or removal taking effect upon the appointment of a successor depositary and its acceptance of such appointment. Such successor depositary will be appointed by us within 60 days after delivery of the notice of resignation or removal. 

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Miscellaneous 

The depositary will forward to the holders of the depositary shares all notices and reports from us that we are required to furnish to the holders of the Series A Preferred Stock. 

Neither the depositary nor we will be liable if it or we are prevented or delayed by law or any circumstances beyond its or our control in performing our respective obligations under the Deposit Agreement. Our obligations and the obligations of the depositary under the Deposit Agreement will be limited to the performance of such duties as are set forth in the Deposit Agreement. Neither we nor the depositary shall be subject to any liability under the Deposit Agreement, other than for bad faith, gross negligence or willful misconduct. 

Neither we nor the depositary, the registrar or the transfer agent will be obligated to prosecute or defend any legal proceedings in respect of any depositary shares or the Series A Preferred Stock unless a satisfactory indemnity is furnished. We and the depositary may rely upon written advice of counsel or independent accountants, or information provided by persons presenting Series A Preferred Stock for deposit, holders of depositary shares or other persons believed to be competent and on documents believed to be genuine. 

 

 

 

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