Document:

Exhibit 10.5

 

Final

 

PIPE SUBSCRIPTION AGREEMENT

 

This PIPE SUBSCRIPTION AGREEMENT
(this “Subscription Agreement”) is entered into this [     ]th day of [    ], 2022, by and among Caravelle International Group
(the “PubCo”), a Cayman Islands exempted company, Pacifico Acquisition Corp, a Delaware corporation (the “SPAC”),
and the undersigned (the “PIPE Investor”, “Subscriber” or “you”). Defined terms
used but not otherwise defined herein shall have the respective meanings ascribed thereto in the Transaction Agreement (as defined below).

 

WHEREAS, the PubCo, the SPAC
and the other parties named therein have entered into an Agreement and Plan of Merger dated as of April 5, 2022 (as it may be amended,
the “Transaction Agreement” and the transactions contemplated thereby, the “Transactions”), pursuant
to which, (1) Pacifico International Group, a Cayman Islands exempted company and a wholly-owned subsidiary of the PubCo (“Merger
Sub 1”), will merge with and into Caravelle Group Co., Ltd. (the “Target”), with the Target as the surviving
entity (the “Initial Merger”), and (ii) Pacifico Merger Sub 2 Inc. (“Merger Sub 2”), a Delaware
corporation and a wholly-owned subsidiary of the PubCo, will, following consummation of the Initial Merger, merge with and into the SPAC,
with the SPAC as the surviving entity (the “SPAC Merger” and together with the Initial Merger, the “Mergers”);

 

WHEREAS, in connection with
and contingent on the closing of the Transactions (the “Transaction Closing”), as contemplated by the Transaction Agreement,
and pursuant to the terms and conditions hereof, Subscriber desires to subscribe for and purchase from the PubCo that number of the PubCo’s
ordinary shares, par value $0.0001 per share (the “Ordinary Shares”), set forth on the signature page hereto for a
purchase price of $10.00 per share (the “Per Share Price”), or the aggregate purchase price set forth on the signature
page hereto (the “Purchase Price”), and the PubCo desires to issue and sell to Subscriber at the Transaction Closing
the Securities (as defined below) in consideration of the payment of the Purchase Price by or on behalf of Subscriber to the PubCo on
or prior to the Transaction Closing; and

 

WHEREAS, in connection with
the Transactions, certain other institutional “accredited investors” (within the meaning of Rule 501(a) under the Securities
Act of 1933, as amended (the “Securities Act”)) or “qualified institutional buyers” (within the meaning
of Rule 144A under the Securities Act) (the “Other Subscribers”) are entering into separate subscription agreements
with the PubCo and the SPAC (“Other Subscription Agreements”) substantially similar to this Subscription Agreement,
pursuant to which such Other Subscribers, and Subscriber pursuant to this Subscription Agreement, have agreed, severally and not jointly,
to purchase on the closing date of the Transactions (the “Closing Date”) an aggregate of up to [Ÿ]
Ordinary Shares at the Per Share Price (the “Offering”).

 

     

     

    

 

NOW, THEREFORE, in consideration
of the foregoing and the mutual representations, warranties and covenants, and pursuant to the terms and subject to the conditions, herein
contained, and intending to be legally bound hereby, the parties hereto hereby agree as follows:

 

1. Subscription.
Subject to the terms and conditions hereof, Subscriber hereby subscribes for and agrees to purchase from the PubCo at the PIPE Closing
(as defined below), and the PubCo hereby agrees to issue and sell to Subscriber, at the Transaction Closing, upon the payment of the Purchase
Price, that number of Ordinary Shares set forth on the signature page hereto (the “Securities”) on the terms and conditions
set forth herein (such subscription and issuance, the “Subscription”).

 

2. Representations,
Warranties and Agreements.

 

2.1 Subscriber’s
Representations, Warranties and Agreements. To induce the PubCo to issue the Securities to Subscriber, Subscriber hereby represents
and warrants to each of the SPAC and the PubCo and agrees with the SPAC and the PubCo as follows:

 

2.1.1 Subscriber
has been duly formed or incorporated and is validly existing and in good standing under the laws of its jurisdiction of incorporation
or formation, with power and authority to enter into, deliver and perform its obligations under this Subscription Agreement. If Subscriber
is an individual, Subscriber has the authority to enter into, deliver and perform Subscriber’s obligations under this Subscription
Agreement.

 

2.1.2 This
Subscription Agreement has been duly authorized, executed and delivered by Subscriber. If Subscriber is an individual, the signature on
this Subscription Agreement is genuine, and Subscriber has legal competence and capacity to execute the same. This Subscription Agreement
constitutes a valid and binding obligation of Subscriber, enforceable against Subscriber in accordance with its terms, except as may be
limited or otherwise affected by (i) bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium or other laws relating
to or affecting the rights of creditors generally, and (ii) principles of equity, whether considered at law or equity.

 

2.1.3 Assuming
the accuracy of the PubCo’s representations and warranties as set forth in Section 2.2 and the SPAC’s representations and
warranties as set forth in Section 2.3 hereof, the execution, delivery and performance by Subscriber of this Subscription Agreement and
the consummation of the transactions contemplated herein do not and will not (i) conflict with or result in a breach or violation
of any of the terms or provisions of, or constitute a default under, or result in the creation or imposition of any lien, charge or encumbrance
upon any of the property or assets of Subscriber or any of its subsidiaries pursuant to the terms of any indenture, mortgage, deed of
trust, loan agreement, lease, license or other agreement or instrument to which Subscriber is a party or by which Subscriber is bound
or to which any of the property or assets of Subscriber is subject, which would reasonably be expected to have a material adverse effect
on the business, properties, financial condition, stockholders’ equity or results of operations of Subscriber and its subsidiaries,
taken as a whole, or materially and adversely affect the legal authority or ability of Subscriber to comply in all material respects with
the terms of this Subscription Agreement (a “Subscriber Material Adverse Effect”); (ii) if Subscriber is not an
individual, result in any violation of the provisions of the organizational documents of Subscriber or any of its subsidiaries in any
material respect; or (iii) result in any violation of any statute or any judgment, order, rule or regulation of any court or government
or governmental, tribunal, judicial, administrative federal, state, local, or foreign or any agency, bureau, board, commission instrumentality
or authority thereof, including any state’s attorney general or any court or arbitrator (public or private) (“Authority”),
having jurisdiction over Subscriber or any of its subsidiaries or any of their respective properties that would reasonably be expected
to have a Subscriber Material Adverse Effect.

 

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2.1.4 The
Subscriber (i) is a “qualified institutional buyer” (as defined in Rule 144A under the Securities Act) or an “accredited
investor” (within the meaning of Rule 501(a) under the Securities Act), in each case, satisfying the applicable requirements set
forth on Schedule A attached hereto, (ii) is acquiring all of the Securities only for his, her or its own account and not for the
account of others, or if the Subscriber, or the investment advisor to which Subscriber has delegated decision making authority over its
investments, is subscribing for the Securities as a fiduciary or agent for one or more investment accounts, the Subscriber has full investment
discretion with respect to each such account, and the full power and authority to make the acknowledgements, representations and agreements
herein on behalf of each owner of each such account, and (iii) is acquiring the Securities for investment purposes only and not with a
view to, or for offer or sale in connection with, any distribution thereof in violation of the Securities Act or the laws of any jurisdiction
(and shall provide the requested information set forth on Schedule A). If the Subscriber is an entity, the Subscriber is not an
entity formed for the specific purpose of acquiring the Securities.

 

2.1.5 Subscriber
understands and agrees that the Securities are being offered in a transaction not involving any public offering within the meaning of
the Securities Act and that the Securities have not been registered under the Securities Act. Subscriber understands and agrees that the
Securities may not be resold, transferred, pledged or otherwise disposed of by Subscriber absent an effective registration statement under
the Securities Act with respect to the Securities except (i) to the PubCo or a subsidiary thereof, or (ii) pursuant to another applicable
exemption from the registration requirements of the Securities Act that is available and that any book entries representing the Securities
shall contain a restrictive legend to such effect. Subscriber understands and agrees that the Securities will not be eligible for resale
pursuant to Rule 144A promulgated under the Securities Act. Subscriber understands and agrees that the Securities will be subject to the
foregoing transfer restrictions and, as a result of these transfer restrictions, Subscriber may not be able to readily resell the Securities
and may be required to bear the financial risk of an investment in the Securities for an indefinite period of time. Subscriber understands
that it has been advised to consult legal, tax and accounting counsel prior to making any offer, resale, transfer, pledge or other disposition
of any of the Securities.

 

2.1.6 Subscriber
understands and agrees that Subscriber is purchasing the Securities directly from the PubCo. Subscriber further acknowledges that there
have been no representations, warranties, covenants and agreements made to Subscriber by the PubCo or any of its officers or directors,
expressly or by implication, other than those representations, warranties, covenants and agreements included in this Subscription Agreement,
and Subscriber is not relying on any representations, warranties or covenants other than those expressly set forth in this Subscription
Agreement.

 

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2.1.7 Subscriber
represents and warrants that (i) it is not a Benefit Plan Subscriber as contemplated by the Employee Retirement Income Security Act
of 1974, as amended (“ERISA”), or (ii) its acquisition and holding of the Securities will not constitute or result
in a non-exempt prohibited transaction under Section 406 of ERISA, Section 4975 of the Internal Revenue Code of 1986, as amended,
or any applicable similar law.

 

2.1.8 In
making its decision to purchase the Securities, Subscriber represents that it has relied solely upon independent investigation made by
Subscriber and the representations, warranties, and covenants of the SPAC and the PubCo contained in this Subscription Agreement. Subscriber
acknowledges and agrees that Subscriber has received and has had an adequate opportunity to review, such financial and other information
as Subscriber deems necessary in order to make an investment decision with respect to the Securities and made its own assessment and is
satisfied concerning the relevant tax and other economic considerations relevant to Subscriber’s investment in the Securities. Without
limiting the generality of the foregoing, Subscriber acknowledges that it has had the opportunity to review the documents provided to
Subscriber, including (collectively, the “Disclosure Documents”): (i) the final prospectus of the SPAC, dated as of
September 13, 2021 and filed with the Securities and Exchange Commission (the “Commission”) (File No. 333-258038) (the
“Prospectus”), (ii) each of the SPAC’s filings with the Commission, together with any amendments, restatements
or supplements thereto (the “SEC Documents”) through the date of this Subscription Agreement, (iii) the Transaction
Agreement, a copy of which will be filed by the SPAC with the Commission and (iv) the investor presentation by the SPAC and the Target
(the “Investor Presentation”), a copy of which will be furnished by the SPAC to the Commission. Subscriber represents
and agrees that Subscriber and its professional advisor(s), if any, have had the full opportunity to ask the SPAC’s management questions,
receive such answers and obtain such information as Subscriber and its professional advisor(s), if any, have deemed necessary to make
an investment decision with respect to the Securities. The Subscriber further acknowledges that the information contained in the Disclosure
Documents is subject to change, and that any changes to the information contained in the Disclosure Documents, including any changes based
on updated information or changes in terms of the Transactions, shall in no way affect Subscriber’s obligation to purchase the Securities
hereunder, except as otherwise provided herein, and that, in purchasing the Securities, Subscriber is not relying upon any projections
contained in the Investor Presentation. Subscriber acknowledges and agrees that (i) it has not relied on any statements or other information
provided by Chardan Capital Markets, LLC (the “Placement Agent”) or any of the Placement Agent’s affiliates with
respect to its decision to invest in the Securities, including information related to the SPAC, the PubCo, the Target, the Securities
and the offer and sale of the Securities, (ii) neither the Placement Agent, nor any of the Placement Agent’s affiliates has provided
Subscriber with any information or advice with respect to the Securities, nor is such information or advice necessary or desired, and
(iii) neither the Placement Agent nor any of the Placement Agent’s affiliates has prepared any disclosure or offering document in
connection with the offer and sale of the Securities. Neither the Placement Agent nor any of the Placement Agent’s affiliates has
made or makes any representation as to the SPAC, the PubCo, the Target or the quality or value of the Securities and the Placement Agent
and its affiliates may have acquired non-public information with respect to the SPAC, the PubCo which Subscriber agrees need not be provided
to it. Subscriber agrees the Placement Agent shall not be liable to Subscriber for any action heretofore or hereafter taken or omitted
to be taken by it in connection with Subscriber’s purchase of the Securities.

 

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2.1.9 Subscriber
became aware of this Offering of the Securities solely (a) by means of direct contact from the Placement Agent, the SPAC, the PubCo, the
Target or a representative of the Placement Agent, the SPAC, the PubCo or the Target, or (b) directly from the SPAC or the PubCo as a
result of a pre-existing, substantial relationship with the SPAC or the PubCo, and the Securities were offered to Subscriber solely by
direct contact between Subscriber and either the Placement Agent or the PubCo. Subscriber did not become aware of this Offering of the
Securities, nor were the Securities offered to Subscriber, by any other means. Subscriber acknowledges that the Placement Agent has not
acted as its financial advisor or fiduciary. Subscriber acknowledges that the PubCo represents and warrants that the Securities (i) were
not offered by any form of general solicitation or general advertising and (ii) are not being offered in a manner involving a public
offering under, or in a distribution in violation of, the Securities Act, or any state securities laws.

 

2.1.10 Subscriber
acknowledges that it is aware that there are substantial risks incident to the purchase and ownership of the Securities. Subscriber has
sought such accounting, legal and tax advice as Subscriber has considered necessary to make an informed investment decision. Subscriber
understands and acknowledges that it (i) is a sophisticated investor, experienced in investing in private equity transactions and capable
of evaluating investment risks independently, both in general and with regard to all transactions and investment strategies involving
a security or securities and (ii) has exercised independent judgment in evaluating its participation in the purchase of the Securities.

 

2.1.11 Subscriber
represents and acknowledges that Subscriber has such knowledge and experience in financial and business matters as to be capable of evaluating
the merits and risks of the investment in the Securities, has analyzed and fully considered the risks of an investment in the Securities
and determined that the Securities are a suitable investment for Subscriber and that Subscriber is able at this time and in the foreseeable
future to bear the economic risk of a total loss of Subscriber’s investment in the PubCo. Subscriber further acknowledges specifically
that a possibility of total loss of investment exists.

 

2.1.12 Subscriber
understands and agrees that no federal or state agency has passed upon or endorsed the merits of the Offering of the Securities or made
any findings or determination as to the fairness of this investment.

 

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2.1.13 Subscriber
represents and warrants that Subscriber is not (i) a person or entity named on the List of Specially Designated Nationals and Blocked
Persons, the Executive Order 13599 List, the Foreign Sanctions Evaders List, or the Sectoral Sanctions Identification List, each of which
is administered by the U.S. Treasury Department’s Office of Foreign Assets Control (“OFAC”) or in any Executive
Order issued by the President of the United States and administered by OFAC (“OFAC List”), or a person or entity prohibited
by any OFAC sanctions program, (ii) owned or controlled by, or acting on behalf of, a person, that is named on an OFAC List; (iii) organized,
incorporated, established, located, resident or born in, or a citizen, national, or the government, including any political subdivision,
agency, or instrumentality thereof, of any country or territory embargoed or subject to substantial trade restrictions by the United States;
(iv) a Designated National as defined in the Cuban Assets Control Regulations, 31 C.F.R. Part 515, or (v) a non-U.S. shell bank
or providing banking services indirectly to a non-U.S. shell bank (collectively, a “Prohibited  Investor”).
Subscriber agrees to provide law enforcement agencies, if requested thereby, such records as required by applicable law, provided that
Subscriber is permitted to do so under applicable law. Subscriber represents that if it is a financial institution subject to the Bank
Secrecy Act (31 U.S.C. Section 5311 et seq.) (the “BSA”), as amended by the USA PATRIOT Act of 2001 (the “PATRIOT
Act”), and its implementing regulations (collectively, the “BSA/PATRIOT Act”), that Subscriber, directly
or indirectly through a third-party administrator, maintains policies and procedures reasonably designed to comply with applicable obligations
under the BSA/PATRIOT Act. Subscriber also represents that, to the extent required, it, directly or indirectly through a third-party administrator,
maintains policies and procedures reasonably designed for the screening of its investors against the OFAC sanctions programs, including
the OFAC List, and to otherwise ensure compliance with OFAC-administered sanctions programs. Subscriber further represents and warrants
that, to the extent required, it, directly or indirectly through a third-party administrator, maintains policies and procedures reasonably
designed to ensure that the funds held by Subscriber and used to purchase the Securities were legally derived.

 

2.1.14 On
the date the Purchase Price will be required to be funded pursuant to Section 3.1, Subscriber will have sufficient immediately
available funds to pay the Purchase Price pursuant to Section 3.1.

 

2.1.15 Subscriber
represents that no disqualifying event described in Rule 506(d)(1)(i)-(viii) under the Securities Act (a “Disqualification Event”)
is applicable to Subscriber or any of its Rule 506(d) Related Parties (as defined below), except, if applicable, for a Disqualification
Event as to which Rule 506(d)(2)(ii) or (iii) or (d)(3) is applicable. Subscriber hereby agrees that it shall notify the PubCo promptly
in writing in the event a Disqualification Event becomes applicable to Subscriber or any of its Rule 506(d) Related Parties, except, if
applicable, for a Disqualification Event as to which Rule 506(d)(2)(ii) or (iii) or (d)(3) is applicable. For purposes of this Section
2.1.15, “Rule 506(d) Related Party” shall mean a person or entity that is a direct beneficial owner of Subscriber’s
securities for purposes of Rule 506(d) under the Securities Act.

 

2.1.16 No
broker, finder or other financial consultant has acted on behalf of Subscriber in connection with this Subscription Agreement or the transactions
contemplated hereby in such a way as to create any liability on the PubCo.

 

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2.1.17 Except
as expressly disclosed in a Schedule 13D or Schedule 13G (or amendments thereto) filed by such Subscriber with the Commission with respect
to the beneficial ownership of the PubCo’s Ordinary Shares prior to the date hereof, Subscriber is not currently (and at all times
through Transaction Closing will refrain from being or becoming) a member of a “group” (within the meaning of Section 13(d)(3)
or Section 14(d)(2) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or any successor provision)
acting for the purpose of acquiring, holding or disposing of equity securities of the PubCo (within the meaning of Rule 13d-5(b)(1) under
the Exchange Act).

 

2.1.18 No
foreign person (as defined in 31 C.F.R. Part 800.224) in which the national or subnational governments of a single foreign state have
a substantial interest (as defined in 31 C.F.R. Part 800.244) will acquire a substantial interest in the PubCo as a result of the purchase
by such Subscriber and sale of the Securities hereunder such that a declaration to the Committee on Foreign Investment in the United States
would be mandatory under 31 C.F.R. Part 800.401, and no foreign person will have control (as defined in 31 C.F.R. Part 800.208) over the
PubCo from and after the Transaction Closing as a result of the purchase by such Subscriber and sale of the Securities hereunder.

 

2.2 PubCo’s
Representations, Warranties and Agreements. To induce Subscriber to purchase the Securities, the PubCo hereby represents and warrants
to Subscriber and agrees with Subscriber as follows:

 

2.2.1 The
PubCo has been duly incorporated and is validly existing as a corporation in good standing under the laws of the Cayman Islands, with
the requisite corporate power and authority to own, lease and operate its properties and conduct its business as presently conducted and
to enter into, deliver and perform its obligations under this Subscription Agreement.

 

2.2.2 The
Securities have been duly authorized and, when issued and delivered to Subscriber against full payment for the Securities in accordance
with the terms of this Subscription Agreement, and registered with the PubCo’s transfer agent, the Securities will be validly issued,
fully paid, non-assessable and free and clear of any liens or other restrictions whatsoever (other than those arising under state or federal
securities laws or as set forth herein), and will not be issued in violation of or subject to any preemptive or similar rights created
under the PubCo’s memorandum and articles of association or under the laws of the Cayman Islands .

 

2.2.3 This
Subscription Agreement has been duly authorized, executed and delivered by the PubCo and, assuming that this Subscription Agreement constitutes
a valid and binding obligation of the Subscriber, is a valid and binding obligation of the PubCo, enforceable against it in accordance
with its terms, except as may be limited or otherwise affected by (i) bankruptcy, insolvency, fraudulent conveyance, reorganization,
moratorium or other laws relating to or affecting the rights of creditors generally, and (ii) principles of equity, whether considered
at law or equity.

 

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2.2.4 The
execution, delivery and performance of this Subscription Agreement (including compliance by the PubCo with all of the provisions hereof),
the issuance and sale of the Securities and the consummation of the certain other transactions contemplated herein will not (i) conflict
with or result in a breach or violation of any of the terms or provisions of, or constitute a default under, or result in the creation
or imposition of any lien, charge or encumbrance upon any of the property or assets of the PubCo pursuant to the terms of any indenture,
mortgage, deed of trust, loan agreement, lease, license or other agreement or instrument to which the PubCo is a party or by which the
PubCo is bound or to which any of the property or assets of the PubCo is subject, which would, individually or in the aggregate, reasonably
be expected to have a material adverse effect on the business, properties, assets, liabilities, operations, financial condition, stockholders’
equity or results of operations of the PubCo or materially and adversely affect the validity of the Securities or the legal authority
or ability of the PubCo to comply in all material respects with the terms of this Subscription Agreement (an “PubCo Material
Adverse Effect”); (ii) result in any violation of the provisions of the organizational documents of the PubCo in any material
respect; or (iii) result in any violation of any statute or any judgment, order, rule or regulation of any Authority having jurisdiction
over the PubCo or any of its properties that would reasonably be expected to have an PubCo Material Adverse Effect.

 

2.2.5 Neither
the PubCo, nor any person acting on its behalf has, directly or indirectly, made any offers or sales of any PubCo security or solicited
any offers to buy any security, under circumstances that would adversely affect reliance by the PubCo on Section 4(a)(2) of the Securities
Act for the exemption from registration for the transactions contemplated hereby or would require registration of the issuance or sale
of the Securities under the Securities Act.

 

2.2.6 Neither
the PubCo nor any person acting on its behalf has conducted any general solicitation or general advertising (as those terms are used in
Regulation D under the Securities Act) in connection with the offer or sale of any of the Securities and neither the PubCo, nor any person
acting on its behalf has offered any of the Securities in a manner involving any public offering under, or in a distribution in violation
of, the Securities Act or any state securities laws.

 

2.2.7 The
PubCo has not taken any steps to seek protection pursuant to any law or statute relating to bankruptcy, insolvency, reorganization, receivership,
liquidation, administration or winding up or failed to pay its debts when due, nor does the PubCo have any knowledge or reason to believe
that any of their respective creditors intend to initiate involuntary bankruptcy proceedings or seek to commence an administration.

 

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2.2.8 As
of the date of this Subscription Agreement, the authorized capital stock of the PubCo consists of 500,000,000 Ordinary Shares, par value
$0.0001 per share, of which one (1) Ordinary Share is issued and outstanding as of the date hereof and no preferred shares are issued
and outstanding. The issued and outstanding Ordinary Share has been duly authorized and validly issued, is fully paid and is non-assessable
and is not subject to preemptive rights. As of the date hereof, except as set forth above pursuant to the organizational documents of
the PubCo, the Other Subscription Agreements, the Transaction Agreement and the other agreements and arrangements referred to therein,
there are no outstanding options, warrants or other rights to subscribe for, purchase or acquire from the PubCo any Ordinary Shares or
other equity interests in the PubCo, or securities convertible into or exchangeable or exercisable for such equity interests. As of the
date hereof, other than any subsidiary created for purposes of the Transactions, the PubCo has no subsidiaries and does not own, directly
or indirectly, interests or investments (whether equity or debt) in any person, whether incorporated or unincorporated. There are no stockholder
agreements, voting trusts or other agreements or understandings to which the PubCo is a party or by which it is bound relating to the
voting of any securities of the PubCo, other than as contemplated by the Transaction Agreement. The PubCo has no outstanding indebtedness
and will not have any outstanding long-term indebtedness as of immediately prior to the Transaction Closing.

 

2.2.9 Assuming
the accuracy of the representations and warranties of the Subscriber, the PubCo 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, self-regulatory organization or other person in connection with the execution, delivery and performance by the PubCo of this
Subscription Agreement (including, without limitation, the issuance of the Securities), other than (i) any required filing of a Notice
of Exempt Offering of Securities on Form D with the Commission under Regulation D of the Securities Act, (ii) the filing with the Commission
of a registration statement pursuant to Section 6, (iii) the filings required by applicable state or federal securities laws, (iv)
the filings required in accordance with Section 8.1, (v) any filings or notices required by Nasdaq or the NYSE, as applicable,
(vi) those required to consummate the Transactions as provided under the Transaction Agreement, (vii) the filing of notification under
the Hart-Scott Rodino Antitrust Improvements Act of 1976, if applicable (“HSR”), if applicable, and (viii) any consent,
waiver, authorization or order of, notice to, or filing or registration, the failure of which to obtain would not be reasonably expected
to have, individually or in the aggregate, an PubCo Material Adverse Effect.

 

2.2.10 Upon
consummation of the Transaction Closing, the Securities will be registered pursuant to Section 12(b) of the Exchange Act and will be listed
for trading on the Nasdaq or the NYSE, as determined by the PubCo, and the Securities will be approved for listing on such trading market,
subject to official notice of issuance.

 

2.2.11 Except
as set forth in the following sentence, the PubCo has not entered into any agreement or arrangement entitling any agent, broker, investment
banker, financial advisor or other person to any broker’s or finder’s fee or any other commission or similar fee in connection
with the transactions contemplated by this Subscription Agreement for which the Subscriber could become liable. Other than compensation
to be paid to the Placement Agent, the PubCo is not aware of any person that has been or will be paid (directly or indirectly) remuneration
for solicitation of the Subscriber in connection with the sale of any Securities in the Offering.

 

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2.2.12 Assuming
the accuracy of the Subscriber’s representations and warranties set forth in Section 2.1, in connection with the offer, sale and
delivery of the Securities in the manner contemplated by this Subscription Agreement, it is not necessary to register the Securities under
the Securities Act. The Securities (i) were not offered by any form of general solicitation or general advertising and (ii) are not being
offered in a manner involving a public offering under, or in a distribution in violation of, the Securities Act or any state securities
laws.

 

2.2.13 Other
than the Other Subscription Agreements, the Transaction Agreement and any other agreement expressly contemplated by the Transaction Agreement,
the PubCo has not entered into any side letter or similar agreement with any Other Subscriber or any other investor in connection with
such Other Subscriber’s or investor’s investment in the PubCo. No Other Subscription Agreement includes a price per Security
different from this Subscription Agreement or other terms, rights or conditions that are more advantageous (economically or otherwise)
in any material respect to any such Other Subscriber than Subscriber hereunder, and such Other Subscription Agreements have not been amended
or modified in any material respect following the date of this Subscription Agreement in any manner that materially benefits the Other
Subscriber thereunder unless Subscriber has been granted the same benefits.

 

2.2.14 The
PubCo is not, and immediately after receipt of payment for the Securities will not be, an “investment company” within the
meaning of the Investment Company Act of 1940, as amended.

 

2.2.15 As
of the date of this Agreement the PubCo has not received any written communication from a governmental entity that alleges that the PubCo
is not in compliance with or is in default or violation of any applicable law, except where such non-compliance, default or violation
would not, individually or in the aggregate, be reasonably expected to have an PubCo Material Adverse Effect.

 

2.2.16 Except
for such matters as have not had and would not be reasonably expected to have, individually or in the aggregate, an PubCo Material Adverse
Effect, as of the date of this Subscription Agreement, there is no (i) action, claim, inquiry, arbitration, investigation, litigation
or other proceeding pending, or, to the knowledge of the PubCo, threatened against the PubCo or (ii) judgment, decree, injunction, ruling
or order of any governmental entity or arbitrator outstanding against the PubCo.

 

2.2.17 Except
for discussions specifically regarding the offer and sale of the Securities, the PubCo confirms that neither it nor any other person acting
on its behalf has provided Subscriber or its agents or counsel with any information that constitutes or could reasonably be expected to
constitute material, nonpublic information concerning the PubCo or any of its subsidiaries, other than with respect to the Transactions
and the transactions contemplated by this Subscription Agreement or the Other Subscription Agreements, unless prior thereto the Subscriber
shall have consented in writing to the receipt of such information and agreed with the PubCo to keep such information confidential.

 

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2.3 SPAC’s
Representations, Warranties and Agreements. To induce Subscriber to purchase the Securities, the SPAC hereby represents and warrants
to Subscriber and agrees with Subscriber as follows:

 

2.3.1 The
SPAC is a corporation duly organized, validly existing and in good standing under the laws of the State of Delaware. The SPAC has the
corporate power and authority to own, lease and operate its properties and conduct its business as presently conducted and to enter into,
deliver and perform its obligations under this Subscription Agreement.

 

2.3.2 This
Subscription Agreement has been duly authorized, executed and delivered by the SPAC, constitutes a valid and binding obligation of the
SPAC and is enforceable against the SPAC in accordance with its terms, except as may be limited or otherwise affected by (i) bankruptcy,
insolvency, fraudulent conveyance, reorganization, moratorium or other laws relating to or affecting the rights of creditors generally,
and (ii) principles of equity, whether considered at law or equity.

 

2.3.3 The
execution, delivery and performance of this Subscription Agreement, including the issuance and sale of the Securities by the PubCo and
the consummation of the transactions contemplated hereby, (i) will not conflict with or result in a material breach or material violation
of any of the terms or provisions of, or constitute a material default under, or result in the creation or imposition of any lien, charge
or encumbrance upon any of the property or assets of the SPAC or any of its subsidiaries pursuant to the terms of any indenture, mortgage,
deed of trust, loan agreement, license, lease or any other agreement or instrument to which the SPAC or any of its subsidiaries is a party
or by which the SPAC or any of its subsidiaries is bound or to which any of the property or assets of the SPAC is subject, which would
have a material adverse effect on the business, properties, assets, liabilities, operations, condition (including financial condition),
stockholders’ equity or results of operations of the SPAC or the combined company after giving effect to the Transactions (a “SPAC
Material Adverse Effect”) or materially affect the validity of the Securities or the legal authority or ability of the SPAC
to perform in all material respects its obligations under the terms of this Subscription Agreement; (ii) result in any violation of the
provisions of the organizational documents of the SPAC; or (iii) result in any violation of any statute or any judgment, order, rule or
regulation of any court or governmental agency or body, domestic or foreign, having jurisdiction over the SPAC or any of its properties
that would have a SPAC Material Adverse Effect or materially affect the validity of the Securities or the legal authority or ability of
the SPAC to perform in all material respects its obligations under the terms of this Subscription Agreement.

 

2.3.4 Assuming
the accuracy of the representations and warranties of the Subscriber, the SPAC 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, self-regulatory organization or other person in connection with the execution, delivery and performance by the SPAC of this
Subscription Agreement, other than (i) those required to consummate the Transactions as provided under the Transaction Agreement, (ii)
the filings required in accordance with Section 8.1, (iii) any filings or notices required by Nasdaq, (iv) the filing of notification
under the HSR, (v) any consents, waivers, filings, authorizations or orders which have already been obtained or in respect of which the
SPAC’s obligations thereof have already been satisfied, and (vi) any consent, waiver, authorization or order of, notice to, or filing
or registration, the failure of which to obtain would not be reasonably expected to have, individually or in the aggregate, a SPAC Material
Adverse Effect.

 

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2.3.5 As
of the date of this Subscription Agreement, the authorized capital stock of the SPAC consists of 10,000,000 shares of the SPAC Common
Stock, par value $0.0001 per share, 7,495,000 of which are issued and outstanding. (the “SPAC Common Stock”). Except
for (i) the SPAC Units (ii) the rights to purchase 575,000 shares of SPAC Common Stock and (iii) the unit purchase options to purchase
158,125 units of the SPAC at a price of $11.50 per unit, as of the date hereof, there are no outstanding options, warrants or other rights
to subscribe for, purchase or acquire from the SPAC shares of SPAC Common Stock or other equity interests in the SPAC, or securities convertible
into or exchangeable or exercisable for such equity interests. As of the date hereof, the SPAC has no subsidiaries, and does not own,
directly or indirectly, interests or investments (whether equity or debt) in any person, whether incorporated or unincorporated. There
are no shareholder agreements, voting trusts or other agreements or understandings to which the SPAC is a party or by which it is bound
relating to the voting of any securities of the SPAC, other than (1) as set forth in the SEC Documents and (2) as contemplated by the
Transaction Agreement. As of the date hereof, the SPAC had no outstanding long-term indebtedness (other than (a) any loans which may be
made by the SPAC’s insiders, officers, directors or any of its or their affiliates to finance transaction costs in connection with
the Transaction (the “Insider Loans”), (b) $2,156,250 payable (3.75% of the gross proceeds of its initial public offering)
to the underwriters as deferred underwriting discounts and commissions in connection with its initial public offering (the “Deferred
Compensation in Cash”), and (c) $431,250 payable (0.75% of the gross proceeds of its initial public offering) to the underwriters
as deferred underwriting discounts and commissions in connection with its initial public offering in the form of shares of SPAC Common
Stock at a price of $10.00 per share (the “Deferred Compensation in Shares”)), and will not have any such long-term
indebtedness immediately prior to the Transaction Closing (other than the Insider Loans and the Deferred Compensation in Cash and the
Deferred Compensation in Shares). There are no securities or instruments by or to which the SPAC is a party containing anti-dilution or
similar provisions that will be triggered by the issuance of the Subscriber Shares, that have not been or will not be validly waived on
or prior to the Transaction Closing Date.

 

2.3.6 As
of the date of this Agreement, the issued and outstanding shares of SPAC Common Stock are registered pursuant to Section 12(b) of Exchange
Act, and are listed for trading on Nasdaq under the symbol “PAFO.” There is no suit, action, proceeding or investigation pending
or, to the knowledge of the SPAC, threatened against the SPAC by Nasdaq or the Commission with respect to any intention by such entity
to deregister the SPAC Common Stock or prohibit or terminate the listing of the SPAC Common Stock on Nasdaq.

 

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2.3.7 Except
for such matters as have not had and would not be reasonably be expected to have, individually or in the aggregate, a SPAC Material Adverse
Effect, there is no (i) action, suit, claim or other proceeding, in each case by or before any governmental authority pending, or, to
the knowledge of the SPAC, threatened against the SPAC, or (ii) judgment, decree, injunction, ruling or order of any governmental entity
outstanding against the SPAC.

 

2.3.8 The
SPAC is in compliance with all applicable laws, except where such non-compliance would not reasonably be expected to have a SPAC Material
Adverse Effect. The SPAC has not received any written communication from a governmental entity that alleges that the SPAC is not in compliance
with or is in default or violation of any applicable law, except where such non-compliance, default or violation would not, individually
or in the aggregate, be reasonably expected to have a SPAC Material Adverse Effect. The SPAC is not in default or violation (and no event
has occurred which, with notice or the lapse of time or both, would constitute a default or violation) of any term, condition or provision
of (i) the organizational documents of the SPAC, (ii) any loan or credit agreement, note, bond, mortgage, indenture, lease or other agreement,
permit, franchise or license to which the SPAC is now a party or by which the SPAC’s properties or assets are bound, or (iii) any
statute or any judgment, order, rule or regulation of any court or governmental agency or body, domestic or foreign, having jurisdiction
over the SPAC or any of its properties, except, in the case of clauses (ii) and (iii), for defaults or violations that have not had and
would not reasonably be expected to have, individually or in the aggregate, a SPAC Material Adverse Effect.

 

2.3.9 The
SPAC has not entered into any agreement or arrangement entitling any agent, broker, investment banker, financial advisor or other person
to any broker’s or finder’s fee or any other commission or similar fee in connection with the transactions contemplated by
this Subscription Agreement for which the Subscriber could become liable. Other than compensation to be paid to the Placement Agent, the
SPAC is not aware of any person that has been or will be paid (directly or indirectly) remuneration for solicitation of the Subscriber
in connection with the sale of any Securities in the Offering.

 

2.3.10 As
of their respective dates, all the SEC Documents filed prior to the date of this Subscription Agreement complied in all material respects
with the applicable requirements of the Securities Act, the Exchange Act and the rules and regulations of the Commission promulgated thereunder,
and none of the SEC Documents, 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 SPAC included in the SEC Documents comply in all material respects with applicable accounting
requirements and the rules and regulations of the Commission with respect thereto as in effect at the time of filing and fairly present
in all material respects the financial position of the SPAC 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. The SPAC has filed each
report, statement, schedule, prospectus, and registration statement that the SPAC was required to file with the Commission since its initial
registration of the SPAC Common Stock with the Commission. A copy of each SEC Document is available to the Subscriber via the Commission’s
EDGAR system. There are no outstanding or unresolved comments in comment letters received by the SPAC from the staff of the Division of
Corporation Finance of the Commission with respect to any of the SEC Documents.

 

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2.3.11 Other
than the Other Subscription Agreements, the Transaction Agreement, and the agreements contemplated thereby, the SPAC has not entered into
any subscription agreement, side letter or similar agreement with any Other Subscriber in connection with such Other Subscriber’s
investment in the PubCo through the Offering, except for side letters required to comply with an Other Subscriber’s policies and
procedures or rules and regulations applicable to the Other Subscriber. No Other Subscription Agreement includes terms and conditions
that are more advantageous to any such Other Subscriber than the Subscriber hereunder (other than terms particular to the regulatory requirements
of such subscriber or its affiliates or related funds), and such Other Subscription Agreements have not been amended or modified in any
material respect following the date of this Subscription Agreement to include such terms and conditions.

 

2.3.12 The
SPAC has not taken any steps to seek protection pursuant to any law or statute relating to bankruptcy, insolvency, reorganization, receivership,
liquidation, administration or winding up or failed to pay its debts when due, nor does the SPAC have any knowledge or reason to believe
that any of its creditors intend to initiate involuntary bankruptcy proceedings or seek to commence an administration.

 

3. Settlement
Date and Delivery.

 

3.1 PIPE
Closing. The closing of the Subscription contemplated hereby (the “PIPE Closing”) is contingent upon the substantially
concurrent consummation of the Transactions, as provided for by the Transaction Agreement. The PIPE Closing shall occur on the date of
but immediately prior to the SPAC Merger. Upon written notice from (or on behalf of) the PubCo to Subscriber (the “Closing Notice”)
that the PubCo reasonably expects all conditions to the Transaction Closing to be satisfied on a date that is not less than five (5) business
days from the date of the Closing Notice, Subscriber shall deliver to the PubCo, at least two (2) business day prior to the scheduled
closing date specified in the Closing Notice (the “Scheduled Closing Date”), to be held in escrow until the PIPE Closing,
the Purchase Price for the Securities by wire transfer of United States dollars in immediately available funds to the account specified
by the PubCo in the Closing Notice, which at the PIPE Closing will be released to the PubCo against delivery by the PubCo promptly after
the Transaction Closing to Subscriber of the Securities in book-entry form (or in certificated form if indicated by Subscriber on Subscriber’s
signature page hereto), free and clear of any liens or other restrictions (other than those arising under this Subscription Agreement
or applicable securities laws). Not later than one (1) business day after the Transaction Closing, the PubCo shall deliver to Subscriber
the Securities in book entry form, in the name of Subscriber (or its nominee in accordance with its delivery instructions) or to a custodian
designated by Subscriber, as applicable. In the event that the consummation of the SPAC Merger does not occur within three (3) business
days after the Scheduled Closing Date specified in the Closing Notice (as may be supplemented), or the PIPE Closing does not occur within
three (3) business days of the Scheduled Closing Date for any other reason, the PubCo shall promptly (but not later than two (2) business
days thereafter) return the Purchase Price to Subscriber by wire transfer of U.S. dollars in immediately available funds to the account
specified by the Subscriber, and any book-entries for the Securities shall be deemed repurchased and cancelled. Unless this Subscription
Agreement is terminated pursuant to Section 5 below, the failure of the Transaction Closing to occur on the Scheduled Closing Date shall
not terminate this Subscription Agreement or otherwise relieve any party of any of its obligations hereunder. For purposes of this Subscription
Agreement, “business day” means any day that, in New York, New York, is neither a legal holiday nor a day on which commercial
banking institutions are generally authorized or required by law or regulation to close (excluding as a result of “stay at home”,
“shelter-in-place”, “non-essential employee” or any other similar orders or restrictions or the closure of any
physical branch locations at the direction of any governmental authority so long as the electronic funds transfer systems, including for
wire transfers, of commercial banking institutions in New York, New York are generally open for use by customers on such day).

 

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3.2 Conditions
to PIPE Closing.

 

3.2.1 The
PIPE Closing shall be subject to the satisfaction or valid waiver by the SPAC, the PubCo, or Subscriber of the conditions that, on the
Closing Date:

 

(i) No
suspension of the qualification of the Securities for offering or sale or trading of the SPAC Common Stock on the Nasdaq Capital Market
(“Nasdaq”) shall have occurred and be continuing.

 

(ii) No
Authority shall have enacted, issued, promulgated, enforced or entered any law, rule, regulation, judgment, decree, executive order or
award (whether temporary, preliminary or permanent) which is then in effect and has the effect of making the transactions contemplated
hereby illegal or otherwise prohibiting or enjoining the consummation of the transactions contemplated hereby.

 

(iii) All
conditions precedent to the consummation of the Transactions set forth in the Transaction Agreement, as determined by the parties to the
Transaction Agreement, shall have been satisfied or waived by the party entitled to the benefit thereof (as determined by the parties
to the Transaction Agreement and other than those conditions that, by their nature, (x) may only be satisfied at the Transaction Closing
(including to the extent that any such condition is dependent upon the consummation of the purchase and sale of the Securities pursuant
to this Subscription Agreement and the Other Subscription Agreements), but subject to the satisfaction or waiver of such conditions as
of the Transaction Closing, or (y) will be satisfied by the PIPE Closing and the closing of the transactions contemplated by the Other
Subscription Agreements), and the SPAC Merger shall be scheduled to occur immediately following the PIPE Closing.

 

3.2.2 The
PIPE Closing shall also be subject to the satisfaction or valid waiver by the Subscriber of the conditions that, on the Closing Date:

 

(i) The
PubCo and the SPAC shall have performed, satisfied and complied in all material respects with all agreements, conditions and covenants
required by this Subscription Agreement to be performed by the SPAC and the PubCo at or prior to the PIPE Closing.

 

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(ii) The
representations and warranties of the PubCo and the SPAC contained in this Subscription Agreement shall be true and correct in all material
respects (other than representations and warranties that are qualified as to materiality or an PubCo Material Adverse Effect or a SPAC
Material Adverse Effect, which representations and warranties shall be true in all respects) at and as of the Closing Date (except for
representations and warranties made as of a specific date, which shall be true and correct in all material respects (other than representations
and warranties that are qualified as to materiality or an PubCo Material Adverse Effect or a SPAC Material Adverse Effect, which representations
and warranties shall be true in all respects) as of such date), and consummation of the PIPE Closing, shall constitute a reaffirmation
by the PubCo and the SPAC of each of the representations, warranties and agreements of the PubCo and the SPAC contained in this Subscription
Agreement as of the Closing Date.

 

(iii) No
amendment, waiver or modification of the Transaction Agreement shall have occurred that would reasonably be expected to materially and
adversely affect the economic benefits that Subscriber would reasonably expect to receive under this Subscription Agreement, unless Subscriber
has previously consented in writing to such amendment, waiver or modification.

 

(iv) PubCo
shall have filed with Nasdaq an application or supplemental listing application for the listing of the Securities and Nasdaq shall have
raised no objection with respect thereto, subject to official notice of issuance.

 

(v) There
shall have been no amendment, waiver or modification to the Other Subscription Agreements that materially benefits (economically or otherwise)
the Other Subscribers thereunder unless this Subscription Agreement shall have been amended to reflect the same terms.

 

(vi) From
and after the date hereof, there shall have not occurred a Material Adverse Effect which is continuing and uncured.

 

3.2.3 The
PIPE Closing shall also be subject to the satisfaction or valid waiver by the PubCo of the conditions that, on the Closing Date:

 

(i) Subscriber
shall have performed, satisfied and complied in all material respects with all agreements, conditions and covenants required by this Subscription
Agreement to be performed by Subscriber at or prior to the PIPE Closing.

 

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(ii) All
representations and warranties of Subscriber contained in this Subscription Agreement shall be true and correct in all material respects
(other than representations and warranties that are qualified as to materiality or Subscriber Material Adverse Effect, which representations
and warranties shall be true in all respects) at and as of the Closing Date (except for representations and warranties made as of a specific
date, which shall be true and correct in all material respects (other than representations and warranties that are qualified as to materiality
or Subscriber Material Adverse Effect, which representations and warranties shall be true in all respects) as of such date), and consummation
of the PIPE Closing, shall constitute a reaffirmation by the Subscriber of each of the representations, warranties and agreements of the
Subscriber contained in this Subscription Agreement as of the Closing Date.

 

4. Transfer
Restrictions.

 

4.1 After
the Transaction Closing, the Securities may only be resold, transferred, pledged or otherwise disposed of in compliance with state and
federal securities laws and pursuant to an effective registration statement, Rule 144 under the Securities Act (“Rule 144”)
or pursuant to another applicable exemption from the registration requirements of the Securities Act, to the PubCo or to an affiliate
of Subscriber. As a condition of transfer (other than pursuant to an effective registration statement pursuant to Rule 144 or pursuant
to another applicable exemption from the registration requirements of the Securities Act), any such transferee shall agree in writing
to be bound by the terms of this Subscription Agreement and shall have the rights and obligations of Subscriber under this Agreement.

 

4.2 Each
of the SPAC and the PubCo acknowledge that the Securities may be pledged by Subscriber in connection with a bona fide margin agreement,
provided that such pledge shall be pursuant to an available exemption from the registration requirements of the Securities Act or pursuant
to, and in accordance with, a registration statement that is effective under the Securities Act at the time of such pledge, and Subscriber
effecting a pledge of the Securities shall not be required to provide the PubCo with any notice thereof; provided, however, that neither
the PubCo nor its counsel shall be required to take any action (or refrain from taking any action) in connection with any such pledge,
other than providing any such lender of such margin agreement with an acknowledgment that the Securities are not subject to any contractual
lock up or prohibition on pledging, the form of such acknowledgment to be subject to review and comment by the PubCo in all respects.

 

4.3 Subject
to applicable requirements of the Securities Act and the interpretations of the Commission thereunder and any requirements of the PubCo’s
transfer agent, the PubCo shall use commercially reasonable efforts to ensure that instruments, whether certificated or uncertificated,
evidencing the Securities shall not contain any legend (including the legend set forth in Section 4.4 below) (i) following any sale of
such Securities pursuant to Rule 144, (ii) if such Securities are eligible for sale under Rule 144 without the requirement for the PubCo
to be in compliance with the current public information required under Rule 144 and without volume or manner-of-sale restrictions, and
in each case, Subscriber provides the PubCo with an undertaking to effect any sales or other transfers in accordance with the Securities
Act, or (iii) if such legend is not required under applicable requirements of the Securities Act (including judicial interpretations and
pronouncements issued by the staff of the Commission).

 

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4.4 Subscriber
agrees to the imprinting, so long as is required by this Section 4, of a legend on any of the Securities in the following form:

 

THIS SECURITY HAS NOT 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.

 

4.5 
Subscriber hereby acknowledges and agrees that it will not, and will cause each person acting at Subscriber’s direction or pursuant
to any understanding with Subscriber to not, directly or indirectly offer, sell, pledge, contract to sell or sell any option to purchase,
or engage in hedging activities or execute any “short sales” as defined in Rule 200 of Regulation SHO under the Exchange Act,
in each case that result in Subscriber having a net short cash position in respect of the Securities until the Transaction Closing (or
such earlier termination of this Subscription Agreement in accordance with its terms). For the avoidance of doubt, nothing contained herein
shall prohibit Subscriber from (i) any purchase of securities by Subscriber, its controlled affiliates or any person or entity acting
on behalf of Subscriber or any of its controlled affiliates in an open market transaction after the execution of this Subscription Agreement,
or (ii) any sale (including the exercise of any redemption right) of securities of the PubCo (A) held by Subscriber, its controlled affiliates
or any person or entity acting on behalf of Subscriber or any of its controlled affiliates prior to the execution of this Subscription
Agreement or (B) purchased by Subscriber, its controlled affiliates or any person or entity acting on behalf of Subscriber or any of its
controlled affiliates in an open market transaction after the execution of this Subscription Agreement. Notwithstanding the foregoing,
(i) nothing herein shall prohibit other entities under common management with Subscriber that have no knowledge of this Subscription Agreement
or of Subscriber’s participation in the Transactions (including Subscriber’s controlled affiliates and/or affiliates) from
entering into any “short sales” as defined in Rule 200 of Regulation SHO under the Exchange Act and (ii) in the case of a
Subscriber that is a multi-managed investment vehicle whereby separate portfolio managers manage separate portions of such Subscriber’s
assets and the portfolio managers have no knowledge of the investment decisions made by the portfolio managers managing other portions
of such Subscriber’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 Subscription Agreement.

 

4.6 The
PubCo will use its commercially reasonable efforts to make all Securities eligible on the Direct Registration System of the Depository
Trust Company so that Subscriber can move shares to respective prime broker accounts and sell without restriction.

 

5. Termination.
Except for the provisions of Sections 5, 7, 8 and 9 and the provisions of this Agreement providing for the return of funds previously
delivered in the event the Transaction Closing does not occur, all of which shall survive any termination hereunder, this Subscription
Agreement shall terminate and be void and of no further force and effect, and all rights and obligations of the parties hereunder shall
terminate without any further liability on the part of any party in respect thereof, upon the earliest to occur of (i) such date
and time as the Transaction Agreement is terminated in accordance with its terms, (ii) upon the mutual written agreement of each
of the parties hereto to terminate this Subscription Agreement, (iii) at the election of the Subscriber, if the Transaction Closing shall
not have occurred on or before the Agreement End Date (as defined in the Transaction Agreement), or (iv) if any of the conditions to PIPE
Closing set forth in Section 3.2 are not satisfied on or prior to the Closing Date and, as a result thereof, the transactions contemplated
by this Subscription Agreement are not consummated at the Transaction Closing; provided, that, subject to the limitations set forth
in Section 8, nothing herein will relieve any party from liability for any willful breach hereof prior to the time of termination,
and each party will be entitled to any remedies at law or in equity to recover losses, liabilities or damages arising from such breach.
The PubCo shall notify Subscriber of the termination of the Transaction Agreement promptly after the termination of such agreement. Upon
the termination hereof in accordance with this Section 5, any monies paid by Subscriber to the PubCo in connection herewith shall promptly
(and in any event within two (2) Business Days) be returned in full to Subscriber by wire transfer of U.S. dollars in immediately available
funds to the account specified by Subscriber.

 

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6. Registration
Rights.

 

6.1 The
PubCo agrees that within ninety (90) calendar days after the Closing Date, the PubCo will file with the Commission (at the PubCo’s
sole cost and expense) a registration statement to register under and in accordance with the provisions of the Securities Act, the resale
of all of the Registrable Securities (as defined below) on Form F-3 or Form F-1 (which in either case shall be filed pursuant to Rule
415 under the Securities Act as a secondary-only registration statement), which shall be on Form F-3 if the PubCo is then eligible for
such short form, or any similar or successor short form registration or, if the PubCo is not then eligible for such short form registration
or would not be able to register for resale all of the Registrable Securities on Form F-3, on Form F-1 or any similar or successor long
form registration (the “Registration Statement”). The PubCo will provide a draft of the Registration Statement to Subscriber
for review at least two (2) business days in advance of the filing the Registration Statement, and shall advise Subscriber promptly upon
the Registration Statement being declared effective by the Commission. The PubCo shall use its commercially reasonable efforts to have
the Registration Statement declared effective by the Commission as soon as practicable after the filing thereof, but no later than the
earlier of (i) sixty (60) calendar days (or ninety (90) calendar days if the Commission notifies the PubCo that it will “review”
the Registration Statement) following the Closing Date and (ii) the fifth (5th) business day after the date the PubCo is notified
in writing by the Commission that the Registration Statement will not be “reviewed” or will not be subject to further review
(such earlier date, the “Effectiveness Deadline”); provided, however, that the PubCo’s obligations to include
the Registrable Securities of Subscriber in the Registration Statement are contingent upon Subscriber furnishing in writing to the PubCo
such information regarding Subscriber, the securities of the PubCo held by Subscriber and the intended method of disposition of the Registrable
Securities as shall be reasonably requested by the PubCo to effect the registration of the Registrable Securities, and Subscriber shall
execute such documents in connection with such registration as the PubCo may reasonably request that are customary of a selling shareholder
in similar situations. Notwithstanding the foregoing, if the Commission prevents the PubCo from including any or all of the Registrable
Securities proposed to be registered under the Registration Statement due to limitations on the use of Rule 415 under the Securities Act
for the resale of the Registrable Securities by the Subscribers or otherwise, the PubCo shall use its best efforts to ensure that the
Commission determines that (1) the offering contemplated by the Registration Statement is a bona fide secondary offering and not an offering
“by or on behalf of the PubCo” as defined in Rule 415 of the Securities Act and (2) Subscriber is not a statutory underwriter.
If the PubCo is unsuccessful in the efforts described in the preceding sentence then (i) the PubCo shall cause such Registration Statement
to register for resale such number of Registrable Securities which is equal to the maximum number of Registrable Securities as is permitted
by the Commission and (ii) Subscriber shall have an opportunity to withdraw its Registrable Securities. In such event, the number of Registrable
Securities to be registered for each selling shareholder named in the Registration Statement shall be reduced pro rata among all such
selling shareholders. The PubCo will use its commercially reasonable efforts to maintain the continuous effectiveness of the Registration
Statement until the earliest of (x) such time as when all of Subscriber’s securities included therein cease to be Registrable Securities,
(y) such time as when all of Subscriber’s Registrable Securities included in such Registration Statement have actually been sold
and (z) three years from the Closing Date. The PubCo will use its commercially reasonable efforts to cause the removal of all restrictive
legends from any Registrable Securities being sold under the Registration Statement at the time of sale of such Registrable Securities
upon the receipt from the Subscriber of such supporting documentation, if any, as requested by the PubCo. The PubCo will use commercially
reasonable efforts to file all reports, and provide all customary and reasonable cooperation, reasonably necessary to enable Subscriber
to resell Registrable Securities pursuant to the Registration Statement and Rule 144, qualify the Registrable Securities for listing on
the applicable stock exchange and update or amend the Registration Statement as necessary to include Registrable Securities. “Registrable
Securities” shall mean, as of any date of determination, the Securities and any other equity security issued or issuable with
respect to the Securities by way of share split, dividend, distribution, recapitalization, merger, exchange, replacement or similar event,
provided, however, that such securities shall cease to be Registrable Securities at the earliest of (A) three (3) years after the Closing
Date, (B) the date all Securities held by Subscriber may be sold by Subscriber without volume or manner of sale limitations pursuant to
Rule 144 and without the requirement for the PubCo to be in compliance with the current public information required under Rule 144(c)(1)
(or Rule 144(i)(2), if applicable), (C) the date on which such securities have actually been sold by Subscriber, or (D) when such securities
shall have ceased to be outstanding. Notwithstanding the foregoing, Subscriber shall not be required to sign any form of lock-up agreement
in connection with the Registration Statement. Subscriber may deliver written notice (an “Opt-Out Notice”) to the PubCo
requesting that Subscriber not receive notices from the PubCo otherwise required by this Section 6.1; provided, however, that Subscriber
may later revoke any such Opt-Out Notice in writing. Following receipt of an Opt-Out Notice from Subscriber (unless subsequently revoked),
(i) the PubCo shall not deliver any such notices to Subscriber and Subscriber shall no longer be entitled to the rights associated with
any such notice and (ii) Subscriber will notify the PubCo in writing at least three (3) business days in advance of each intended use
of an effective Registration Statement, and if a notice of a Suspension Event (as defined below) was previously delivered (or would have
been delivered but for the provisions of this Section 6.1) and the related suspension period remains in effect, the PubCo will so notify
Subscriber, within two (2) business days after Subscriber’s notification to the PubCo, by delivering to Subscriber a copy of such
previous notice of Suspension Event, and thereafter will provide Subscriber with the related notice of the conclusion of such Suspension
Event promptly following its availability.

 

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6.2 At
its expense the PubCo shall:

 

6.2.1 except
for such times as the PubCo is permitted hereunder to suspend the use of the prospectus forming part of a Registration Statement, use
its commercially reasonable efforts to keep such registration, and any qualification, exemption or compliance under state securities laws
that the PubCo determines to obtain in connection with such registration, continuously effective with respect to Subscriber, and to keep
the applicable Registration Statement or any subsequent shelf registration statement free of any material misstatements or omissions,
until all Securities acquired by Subscriber hereunder cease to be Registrable Securities or such shorter period upon which Subscriber
has notified the PubCo that such Registrable Securities have actually been sold, or otherwise when such Registration Statement is no longer
required to be effective under this Section 6;

 

6.2.2 subject
to an Opt-Out Notice, advise Subscriber within three (3) business days: (A) of the issuance by the Commission of any stop order suspending
the effectiveness of any Registration Statement or the initiation of any proceedings for such purpose; (B) of the receipt by the PubCo
of any notification with respect to the suspension of the qualification of the Registrable Securities included therein for sale in any
jurisdiction or the initiation or threatening of any proceeding for such purpose; and (C) subject to the provisions in this Subscription
Agreement, of the occurrence of any event that requires the making of any changes in any Registration Statement or prospectus included
therein so that, as of such date, the statements therein are not misleading and do not omit to state a material fact required to be stated
therein or necessary to make the statements therein (in the case of a prospectus, in the light of the circumstances under which they were
made) not misleading. Notwithstanding anything to the contrary set forth herein, the PubCo shall not, when so advising Subscriber of such
events, provide Subscriber with any material, nonpublic information regarding the PubCo other than to the extent that providing notice
to Subscriber of the occurrence of the events listed in (A) through (C) above constitutes material, nonpublic information regarding the
PubCo;

 

6.2.3 use
its commercially reasonable efforts to obtain the withdrawal of any order suspending the effectiveness of any Registration Statement as
promptly as reasonably practicable;

 

6.2.4 upon
the occurrence of any event contemplated in Section 6.2.2, except for such times as the PubCo is permitted hereunder to suspend, and has
suspended, the use of a prospectus forming part of a Registration Statement, the PubCo shall use its commercially reasonable efforts to
as promptly as reasonably practicable prepare a post-effective amendment to such Registration Statement or a supplement to the related
prospectus, or file any other required document so that, as thereafter delivered to purchasers of the Registrable Securities included
therein, such prospectus will not include any untrue statement of a material fact or omit to state any material fact necessary to make
the statements therein, in the light of the circumstances under which they were made, not misleading;

 

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6.2.5 use
its commercially reasonable efforts to cause all Securities to be listed on each securities exchange or market, if any, on which the Ordinary
Shares issued by the PubCo have been listed; and

 

6.2.6 use
its commercially reasonable efforts to take all other steps necessary to effect the registration of the Registrable Securities contemplated
hereby.

 

6.3 Notwithstanding
anything to the contrary in this Subscription Agreement, the PubCo shall be entitled to delay or postpone the effectiveness of the Registration
Statement, and from time to time to require Subscriber not to sell under the Registration Statement or to suspend the effectiveness thereof,
(i) if any information (e.g., compensation data) is not readily available and the non-disclosure of which in the Registration Statement
would be expected, in the reasonable determination of the PubCo’s board of directors, upon the advice of external legal counsel,
to cause the Registration Statement to fail to comply with applicable disclosure requirements, (ii) at any time the PubCo is required
to file a post-effective amendment to the Registration Statement and the Commission has not declared such amendment effective or (iii)
if the negotiation or consummation of a transaction by the PubCo or its subsidiaries is pending or an event has occurred, which negotiation,
consummation or event, the PubCo’s board of directors reasonably believes, upon the advice of external legal counsel, would require
additional disclosure by the PubCo in the Registration Statement of material non-public information that the PubCo has a bona fide business
purpose for keeping confidential and the non-disclosure of which in the Registration Statement would be expected, in the reasonable determination
of the PubCo’s board of directors, upon the advice of external legal counsel, to cause the Registration Statement to fail to comply
with applicable disclosure requirements (each such circumstance, a “Suspension Event”); provided, however, the PubCo
shall not so delay filing or so suspend the use of the Registration Statement on more than two (2) occasions or for a period of more than
sixty (60) consecutive days or more than a total of ninety (90) calendar days, in each case in any three hundred sixty (360) day period.
Upon receipt of any written notice from the PubCo of the happening of any Suspension Event during the period that the Registration Statement
is effective or if as a result of a Suspension Event the Registration Statement or related prospectus contains any untrue statement of
a material fact or omits to state any material fact required to be stated therein or necessary to make the statements therein, in the
light of the circumstances under which they were made (in the case of the prospectus) not misleading, Subscriber agrees that (i) it will
immediately discontinue offers and sales of the Registrable Securities under the Registration Statement (excluding, for the avoidance
of doubt, sales conducted pursuant to Rule 144) until such Subscriber receives copies of a supplemental or amended prospectus (which the
PubCo agrees to promptly prepare after the completion of the Suspension Event) that corrects the misstatement(s) or omission(s) referred
to above and receives notice that any post-effective amendment has become effective or unless otherwise notified by the PubCo that it
may resume such offers and sales, and (ii) it will maintain the confidentiality of any information included in such written notice delivered
by the PubCo unless otherwise required by law or subpoena. If so directed by the PubCo, Subscriber will deliver to the PubCo or, in such
Subscriber’s sole discretion destroy, all copies of the prospectus covering the Registrable Securities in such Subscriber’s
possession; provided, however, that this obligation to deliver or destroy all copies of the prospectus covering the Registrable Securities
shall not apply (i) to the extent such Subscriber is required to retain a copy of such prospectus (a) in order to comply with applicable
legal, regulatory, self-regulatory or professional requirements or (b) in accordance with a bona fide pre-existing document retention
policy or (ii) to copies stored electronically on archival servers as a result of automatic data back-up.

 

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6.4 The
PubCo shall indemnify, defend and hold harmless Subscriber (to the extent a seller under the Registration Statement), and any of its officers,
directors, agents, partners, members, stockholders, affiliates, managers, investment advisers and employees, and each person who controls
Subscriber (within the meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act), to the fullest extent permitted
by applicable law, from and against any and all losses, claims, damages, liabilities, costs (including reasonable out-of-pocket external
attorneys’ fees and expenses incurred in connection with defending or investigating any such action or claim) and expenses (collectively,
“Losses”), as incurred, that arise out of or are based upon (i) any untrue or alleged untrue statement of a material
fact contained in the Registration Statement, any prospectus included in the Registration Statement or any form of prospectus or in any
amendment or supplement thereto or in any preliminary prospectus, or arising out of or relating to any omission or alleged omission to
state a material fact required to be stated therein or necessary to make the statements therein (in the case of any prospectus or form
of prospectus or supplement thereto, in the light of the circumstances under which they were made) not misleading or (ii) any violation
or alleged violation by the PubCo of the Securities Act, Exchange Act or any state securities law or any rule or regulation thereunder,
in connection with the performance of its obligations under this Section 6, except insofar as and to the extent, but only to the extent,
that such untrue statements, alleged untrue statements, omissions or alleged omissions are based upon information regarding Subscriber
furnished in writing to the PubCo by such Subscriber expressly for use therein or such Subscriber has omitted a material fact from such
information or otherwise violated the Securities Act, the Exchange Act or any state securities law or any rule or regulation thereunder,
in each case, in connection with the registration of the Registrable Securities; provided, however, that the indemnification contained
in this Section 6 shall not apply to amounts paid in settlement of any Losses if such settlement is effected without the prior written
consent of the PubCo (which consent shall not be unreasonably withheld, conditioned or delayed), nor shall the PubCo be liable for any
Losses to the extent they arise out of or are based upon a violation which occurs (A) in reliance upon and in conformity with written
information furnished by such Subscriber, (B) in connection with any failure of such person to deliver or cause to be delivered a prospectus
made available by the PubCo in a timely manner, (C) as a result of offers or sales effected by or on behalf of any person by means of
a “free writing prospectus” (as defined in Rule 405 under the Securities Act) that was not authorized in writing by the PubCo,
or (D) in connection with any offers or sales effected by or on behalf of such Subscriber in violation of Section 6.3 hereof. Subscriber
shall notify the PubCo promptly of the institution of any proceeding arising from or in connection with the transactions contemplated
by this Section 6 of which Subscriber becomes aware, provided that a failure by Subscriber to provide such notice shall not impact Subscriber’s
right to be indemnified hereunder unless the PubCo is actually prejudiced thereby. Such indemnity shall remain in full force and effect
regardless of any investigation made by or on behalf of an indemnified party and shall survive the transfer of the Securities by Subscriber.

 

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6.5 Subscriber
shall (severally and not jointly with any Other Subscriber) indemnify and hold harmless the PubCo, its directors, officers, agents and
employees, and each person who controls the PubCo (within the meaning of Section 15 of the Securities Act and Section 20 of the Exchange
Act), to the fullest extent permitted by applicable law, from and against all Losses, as incurred, arising out of or are based upon any
untrue or alleged untrue statement of a material fact contained in any Registration Statement, any prospectus included in the Registration
Statement, or any form of prospectus, or in any amendment or supplement thereto or in any preliminary prospectus, or arising out of or
relating to any omission or alleged omission of a material fact required to be stated therein or necessary to make the statements therein
(in the case of any prospectus, or any form of prospectus or supplement thereto, in light of the circumstances under which they were made)
not misleading to the extent, but only to the extent, that such untrue statements or omissions are based solely upon information regarding
Subscriber furnished in writing to the PubCo by Subscriber expressly for use therein; provided, however, that the indemnification contained
in this Section 6 shall not apply to amounts paid in settlement of any Losses if such settlement is effected without the prior written
consent of Subscriber (which consent shall not be unreasonably withheld, conditioned or delayed). In no event shall the liability of Subscriber
be greater in amount than the dollar amount of the net proceeds received by Subscriber upon the sale of the Registrable Securities giving
rise to such indemnification obligation. The PubCo shall notify Subscriber promptly of the institution of any proceeding arising from
or in connection with the transactions contemplated by this Section 6 of which the PubCo becomes aware, provided that a failure by the
PubCo to provide such notice shall not impact the PubCo’s right to be indemnified hereunder unless Subscriber is actually prejudiced
thereby. Such indemnity shall remain in full force and effect regardless of any investigation made by or on behalf of an indemnified party
and shall survive the transfer of the Securities by Subscriber.

 

6.6 If
the indemnification provided under this Section 6 from the indemnifying party is unavailable or insufficient to hold harmless an indemnified
party in respect of any losses, claims, damages, liabilities and expenses referred to herein, then the indemnifying party, in lieu of
indemnifying the indemnified party, shall contribute to the amount paid or payable by the indemnified party as a result of such losses,
claims, damages, liabilities and expenses in such proportion as is appropriate to reflect the relative fault of the indemnifying party
and the indemnified party, as well as any other relevant equitable considerations. The relative fault of the indemnifying party and indemnified
party shall be determined by reference to, among other things, whether any action in question, including any untrue or alleged untrue
statement of a material fact or omission or alleged omission to state a material fact, was made by, or relates to information supplied
by, such indemnifying party or indemnified party, and the indemnifying party’s and indemnified party’s relative intent, knowledge,
access to information and opportunity to correct or prevent such action. The amount paid or payable by a party as a result of the Losses
or other liabilities referred to above shall be deemed to include, subject to the limitations set forth in this Section 6, any legal or
other fees, charges or expenses reasonably incurred by such party in connection with any investigation or proceeding. No person guilty
of fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act) shall be entitled to contribution pursuant
to this Section 6 from any person who was not guilty of such fraudulent misrepresentation. Each indemnifying party’s obligation
to make a contribution pursuant to this Section 6.6 shall be individual, not joint and several, and in no event shall the liability of
Subscriber hereunder be greater in amount than the dollar amount of the net proceeds received by Subscriber upon the sale of the Registrable
Securities giving rise to such indemnification obligation.

 

7. Miscellaneous.

 

7.1 Further
Assurances. At the PIPE Closing, the parties hereto shall execute and deliver such additional documents and take such additional actions
as the parties reasonably may deem to be practical and necessary in order to consummate the Subscription as contemplated by this Subscription
Agreement.

 

7.1.1 Subscriber
acknowledges that the PubCo, the Placement Agent and others will rely on the acknowledgments, understandings, agreements, representations
and warranties contained in this Subscription Agreement. Subscriber agrees to promptly notify the PubCo if any of the acknowledgments,
understandings, agreements, representations and warranties made by Subscriber set forth herein are no longer accurate in all material
respects. Subscriber further acknowledges and agrees that the Placement Agent is a third-party beneficiary of the representations and
warranties of Subscriber contained in Section 2.1 of this Subscription Agreement.

 

7.1.2 Each
of the PubCo and Subscriber is entitled to rely upon this Subscription Agreement and is irrevocably authorized to produce this Subscription
Agreement or a copy hereof to any interested party in any administrative or legal proceeding or official inquiry with respect to the matters
covered hereby, in each case, to the extent required by applicable law.

 

7.1.3 The
PubCo may request from Subscriber such additional information as the PubCo may deem reasonably necessary to evaluate the eligibility of
Subscriber to acquire the Securities, and Subscriber shall use reasonable best efforts to promptly provide such information as may be
reasonably requested, to the extent readily available and to the extent consistent with its internal policies and procedures, provided
that the PubCo agrees to keep confidential any such information provided by Subscriber.

 

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7.2 Notices.
Any notice or communication required or permitted hereunder shall be in writing and either delivered personally, emailed or sent by overnight
mail via a reputable overnight carrier, or sent by certified or registered mail, postage prepaid, and shall be deemed to be given and
received (a) when so delivered personally, (b) when sent, with affirmative confirmation of receipt, if sent by email, (c) one (1) business
day after being sent, if sent by reputable, internationally recognized overnight courier service or (d) three (3) business days after
the date of mailing by registered or certified mail (prepaid and return receipt requested), in any case, to the address below or to such
other address or addresses as such person may hereafter designate by notice given hereunder:

 

(i) if
to Subscriber, to such address or addresses set forth on the signature page hereto;

 

(ii) if
to the SPAC (prior to the Transaction Closing), to:

 

Pacifico Acquisition Corp.

 

c/o Pacifico Capital LLC

521 Fifth Avenue 17th Floor

New York, NY 10175

Attention: Edward Cong
Wang, Chief Executive Officer 

E-mail: edwardwang@pacificocorp.com

 

with a required copy to (which copy shall not constitute
notice):

 

Loeb & Loeb LLP

345 Park Avenue, 19th Floor

New York, NY 10154

Attention: Giovanni Caruso

E-mail: gcaruso@loeb.com

 

and

 

Chardan Capital Markets, LLC

17 State Street, Suite 2130

New York, New York 10004

Attention:

Email:

 

(iii) if
to the PubCo, to:

 

Caravelle International
Group

c/o Caravelle Group Co., Ltd.

P. O. Box 31119

Grand Pavilion, Hibiscus Way,

802 West Bay Road

Grand Cayman

KYI – 1205 Cayman Islands

Attention: Guohua Zhang

Email: zgh@caravelleglobal.com.cn

 

with a required copy to (which copy shall not constitute
notice):

 

Jun He Law Offices LLC

Suite 1919, 630 Fifth
Avenue

(45 Rockefeller Plaza)

New York, NY 10111

Attention: Lan Lou

Email: loul@junhe.com

 

7.3 Entire
Agreement. This Subscription Agreement constitutes the entire agreement, and supersedes all other prior agreements, understandings,
representations and warranties, both written and oral, among the parties, with respect to the subject matter hereof (other than any confidentiality
agreement entered into by the SPAC, the PubCo and Subscriber in connection with the Offering).

 

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7.4 Modifications
and Amendments. This Subscription Agreement may not be modified, waived or terminated except by an instrument in writing, signed by
the SPAC, the PubCo, Subscriber and, if prior to the Transaction Closing, the Target.

 

7.5 Waivers
and Consents. The terms and provisions of this Subscription Agreement may be waived, or consent for the departure therefrom granted,
only by a written document executed by the party against whom enforcement of such waiver or consent is sought (and with respect to any
waiver or consent by the SPAC or the PubCo prior to the Transaction Closing, the Target). No such waiver or consent shall be deemed to
be or shall constitute a waiver or consent with respect to any other terms or provisions of this Subscription Agreement, whether or not
similar. Each such waiver or consent shall be effective only in the specific instance and for the purpose for which it was given, and
shall not constitute a continuing waiver or consent. No failure or delay by a party hereto in exercising any right, power or remedy under
this Subscription Agreement, and no course of dealing between the parties hereto, shall operate as a waiver of any such right, power or
remedy of such party. No single or partial exercise of any right, power or remedy under this Subscription Agreement by a party hereto,
nor any abandonment or discontinuance of steps to enforce any such right, power or remedy, shall preclude such party from any other or
further exercise thereof or the exercise of any other right, power or remedy hereunder. The election of any remedy by a party hereto shall
not constitute a waiver of the right of such party to pursue other available remedies. No notice to or demand on a party not expressly
required under this Subscription Agreement shall entitle the party receiving such notice or demand to any other or further notice or demand
in similar or other circumstances or constitute a waiver of the rights of the party giving such notice or demand to any other or further
action in any circumstances without such notice or demand.

 

7.6 Assignment.
Neither this Subscription Agreement nor any rights, interests or obligations that may accrue to the Subscriber hereunder (other than the
Securities acquired hereunder by Subscriber, if any, after the Transaction Closing and Subscriber’s rights under Section 6 above)
may be transferred or assigned without the prior written consent of the SPAC and the PubCo, and any purported transfer or assignment without
such consent shall be null and void ab initio; provided, however, Subscriber may transfer or assign its rights, interests
and obligations hereunder to a controlled affiliate of Subscriber or another investment fund or account managed or advised by the same
manager as Subscriber (or a related party or affiliate) that can satisfy the requirements of Section 2.1.4 and the other representations
and warranties in Section 2.1, provided, further, that no such transfer or assignment without the prior express written consent
of the PubCo shall release Subscriber of its obligations hereunder and such transferee(s) or assignee(s), as applicable, agrees in writing
to be bound by the terms hereof as if it were the original Subscriber party hereto.

 

7.7 Benefit.

 

7.7.1 Except
as otherwise provided herein, this Subscription Agreement shall be binding upon, and inure to the benefit of the parties hereto and their
heirs, executors, administrators, successors, legal representatives, and permitted assigns, and the agreements, representations, warranties,
covenants and acknowledgments contained herein shall be deemed to be made by, and be binding upon, such heirs, executors, administrators,
successors, legal representatives and permitted assigns. Except as expressly provided for herein, this Subscription Agreement shall not
confer rights or remedies upon any person other than the parties hereto and their respective successors and permitted assigns.

 

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7.7.2 Subscriber
acknowledges and agrees that (a) this Subscription Agreement is being entered into in order to induce the Target to execute and deliver
the Transaction Agreement and without the representations, warranties, covenants and agreements of Subscriber hereunder, the Target would
not enter into the Transaction Agreement, (b) each representation, warranty, covenant and agreement of Subscriber hereunder is being made
also for the benefit of the Target and the Placement Agent, and (c) the Target may directly enforce (including by an action for specific
performance, injunctive relief or other equitable relief) each of the covenants and agreements of Subscriber under this Subscription Agreement.

 

7.7.3 Each
of the parties agrees that the Target is an express third party beneficiary of this Agreement and the Target may directly enforce (including
by an action for specific performance, injunctive relief or other equitable relief) each of the provisions of this Agreement, as amended,
modified, supplemented or waived in accordance with Sections 7.4 and 7.5, as if it were a direct party hereto. Each of the parties further
agrees that the Placement Agent is a third-party beneficiary of the representations and warranties of Subscriber, the SPAC, and the PubCo
under this Subscription Agreement.

 

7.8 Governing
Law. This Subscription Agreement, and any claim or cause of action hereunder based upon, arising out of or related to this Subscription
Agreement (whether based on law, in equity, in contract, in tort or any other theory) or the negotiation, execution, performance or enforcement
of this Subscription Agreement, shall be governed by and construed in accordance with the laws of the State of New York, without giving
effect to the principles of conflicts of law thereof.

 

7.9 Consent
to Jurisdiction; Waiver of Jury Trial. The parties hereto agree to submit any matter or dispute resulting from or arising out of the
execution, performance, interpretation, breach or termination of this Agreement to the exclusive jurisdiction of federal or state courts
within the County of New York, State of New York (and any appellate courts thereof) (the “Specified Courts”). Each
of the parties agrees that service of any process, summons, notice or document in the manner set forth in Section 7.2 hereof or in such
other manner as may be permitted by applicable law, shall be effective service of process for any proceeding with respect to any matters
to which it has submitted to jurisdiction in this Section 7.9. Each of the parties hereto irrevocably and unconditionally agrees that
it is subject to, and hereby submits to, the personal jurisdiction of the Specified Courts for any action, suit or proceeding arising
out of this Subscription Agreement or the transactions contemplated hereunder and waives any objection to the laying of venue in the Specified
Courts (the United States District Court for the Southern District of New York, or the applicable New York state courts if the federal
jurisdictional standards are not satisfied), and hereby further irrevocably and unconditionally waives and agrees not to plead or claim
in any such court that any such action, suit or proceeding brought in any such court has been brought in an inconvenient forum. TO THE
FULLEST EXTENT PERMITTED BY APPLICABLE LAW, EACH OF THE PARTIES HEREBY IRREVOCABLY WAIVES ITS RIGHTS TO A TRIAL BY JURY.

 

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7.10 Non-Reliance
and Exculpation. Subscriber acknowledges that it is not relying upon, and has not relied upon, any statement, representation or warranty
made by any person (including the Placement Agent, any of its respective affiliates or any
of its or their control persons, officers, directors, employees, partners, agents, and any representatives of any of the foregoing), other
than the statements, representations and warranties of the PubCo and the SPAC expressly contained in Section 2.2 and 2.3 of this Subscription
Agreement, in making its investment or decision to invest in the PubCo. Subscriber acknowledges and agrees that neither of the
Placement Agent, nor its affiliates or any of its or their respective control persons, officers, directors, employees or representatives
shall have any liability to Subscriber pursuant to, arising out of or relating to this Subscription Agreement,
the negotiation hereof or its subject matter, or the transactions contemplated hereby, including, without limitation, with respect
to any action heretofore or hereafter taken or omitted to be taken by any of them in connection
with the purchase of the Securities or with respect to any claim (whether in tort, contract or otherwise) for breach of this Subscription
Agreement or in respect of any written or oral representations made or alleged to be made in connection herewith, as expressly provided
herein, or for any actual or alleged inaccuracies, misstatements or omissions with respect to any information or materials of any kind
furnished by the SPAC, the PubCo, the Placement Agent, the Target or any other person or entity concerning the SPAC, the PubCo or the
Target. Subscriber further acknowledges and agrees that no Other Subscriber pursuant to Other Subscription Agreements (including the controlling
persons, members, officers, directors, partners, agents, employees or other representatives of any such Other Subscriber) shall be liable
to Subscriber pursuant to this Subscription Agreement for any action heretofore or hereafter taken or omitted to be taken by any of them
in connection with the purchase of the Securities.

 

7.11 Severability.
If any provision of this Subscription Agreement shall be invalid, illegal or unenforceable, the validity, legality or enforceability of
the remaining provisions of this Subscription Agreement shall not in any way be affected or impaired thereby and shall continue in full
force and effect. Upon such determination that any provision is invalid, illegal or unenforceable, the parties will substitute for any
invalid, illegal or unenforceable provision a suitable and equitable provision that carries out so far as may be valid, legal and enforceable,
the intent and purpose of such invalid, illegal or unenforceable provision.

 

7.12 Survival
of Representations and Warranties. All representations and warranties made by the parties hereto in this Subscription Agreement or
in any other agreement, certificate or instrument provided for or contemplated hereby, shall survive the PIPE Closing until the expiration
of any statute of limitations under applicable law.

 

7.13 Expenses.
The Subscriber shall pay all of its own expenses in connection with this Subscription Agreement and the transactions contemplated herein.

 

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7.14 Headings
and Captions. The headings and captions of the various subdivisions of this Subscription Agreement are for convenience of reference
only and shall in no way modify or affect the meaning or construction of any of the terms or provisions hereof.

 

7.15 Counterparts.
This Subscription Agreement may be executed in one or more counterparts (including by facsimile or electronic mail or in .pdf), all of
which when taken together shall be considered one and the same agreement and shall become effective when counterparts have been signed
by each party and delivered to the other party, it being understood that both parties need not sign the same counterpart. In the event
that any signature is delivered by facsimile transmission or any other form of electronic delivery, 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
signature page were an original thereof.

 

7.16 Construction.
The words “include,” “includes,” and “including” will be deemed to be followed
by “without limitation.” Pronouns in masculine, feminine, and neuter genders will be construed to include any other
gender, and words in the singular form will be construed to include the plural and vice versa, unless the context otherwise requires.
The words “this Subscription Agreement,” “herein,” “hereof,” “hereby,”
“hereunder,” and words of similar import refer to this Subscription Agreement as a whole and not to any particular
subdivision unless expressly so limited. The parties hereto intend that each representation, warranty, and covenant contained herein will
have independent significance. If any party hereto has breached any representation, warranty, or covenant contained herein in any respect,
the fact that there exists another representation, warranty or covenant relating to the same subject matter (regardless of the relative
levels of specificity) which such party hereto has not breached will not detract from or mitigate the fact that such party hereto is in
breach of the first representation, warranty, or covenant. All references in this Subscription Agreement to numbers of shares, per share
amounts and purchase prices shall be appropriately adjusted to reflect any stock split, stock dividend, stock combination, recapitalization
or the like occurring after the date hereof. As used in this Subscription Agreement, the term: (x) “person” shall refer to
any individual, corporation, partnership, trust, limited liability company or other entity or association, including any governmental
or regulatory body, whether acting in an individual, fiduciary or any other capacity; and (y) “affiliate” shall mean, with
respect to any specified person, any other person or group of persons acting together that, directly or indirectly, through one or more
intermediaries controls, is controlled by or is under common control with such specified person (where the term “control”
(and any correlative terms) means the possession, direct or indirect, of the power to direct or cause the direction of the management
and policies of such person, whether through the ownership of voting securities, by contract or otherwise). For the avoidance of doubt,
any reference in this Subscription Agreement to an affiliate of the SPAC will include the SPAC’s sponsor, Pacifico Capital LLC.

 

7.17 Mutual
Drafting. This Subscription Agreement is the joint product of Subscriber and the PubCo and each provision hereof has been subject
to the mutual consultation, negotiation and agreement of such parties and shall not be construed for or against any party hereto.

 

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7.18 Remedies.

 

7.18.1 The
parties agree that the irreparable damage would occur if this Subscription Agreement was not performed in accordance with its specific
terms or was otherwise breached and that money damages or other legal remedies would not be an adequate remedy for any such damage. It
is accordingly agreed that the parties hereto shall be entitled to equitable relief, including in the form of an injunction or injunctions,
to prevent breaches or threatened breaches of this Subscription Agreement and to enforce specifically the terms and provisions of this
Subscription Agreement in an appropriate court of competent jurisdiction as set forth in Section 7.9, this being in addition to any other
remedy to which any party is entitled at law or in equity, including money damages. The right to specific enforcement shall include the
right of the parties hereto to cause to cause the other parties hereto to cause the transactions contemplated hereby to be consummated
on the terms and subject to the conditions and limitations set forth in this Subscription Agreement. The parties hereto further agree
(i) to waive any requirement for the security or posting of any bond in connection with any such equitable remedy, (ii) not to assert
that a remedy of specific enforcement pursuant to this Section 7.18 is unenforceable, invalid, contrary to applicable law or inequitable
for any reason and (iii) to waive any defenses in any action for specific performance, including the defense that a remedy at law would
be adequate.

 

7.18.2 The
parties acknowledge and agree that this Section 7.18 is an integral part of the transactions contemplated hereby and without that right,
the parties hereto would not have entered into this Subscription Agreement.

 

7.18.3 In
any dispute arising out of or related to this Subscription Agreement, or any other agreement, document, instrument or certificate contemplated
hereby, or any transactions contemplated hereby or thereby, the applicable adjudicating body shall award to the prevailing party, if any,
the documented and out-of-pocket costs and external attorneys’ fees reasonably incurred by the prevailing party in connection with
the dispute and the enforcement of its rights under this Subscription Agreement or any other agreement, document, instrument or certificate
contemplated hereby and, if the adjudicating body determines a party to be the prevailing party under circumstances where the prevailing
party won on some but not all of the claims and counterclaims, the adjudicating body may award the prevailing party an appropriate percentage
of the documented out-of-pocket costs and external attorneys’ fees reasonably incurred by the prevailing party in connection with
the adjudication and the enforcement of its rights under this Subscription Agreement or any other agreement, document, instrument or certificate
contemplated hereby or thereby.

 

8. Disclosure.

 

8.1 The
SPAC shall, by 5:30 p.m., New York City time, on the first (1st ) business day immediately following the date of this Subscription
Agreement file a Current Report on Form 8-K with the Commission (the time of such filing, “Disclosure Time”) disclosing
and describing all material terms of the transactions contemplated hereby and the Mergers, and a form of this Subscription Agreement will
be filed with the Commission as an exhibit thereto. From and after the Disclosure Time, the SPAC represents to Subscriber that it shall
have publicly disclosed all material, non-public information delivered to Subscriber by the SPAC, the Target or any of their officers,
directors, employees or agents in connection with the transactions contemplated by the Subscription Agreement and the Transaction Agreement,
and Subscriber shall no longer be subject to any confidentiality or similar obligations under any current agreement, whether written or
oral with SPAC, the PubCo, Placement Agents or any of their affiliates, relating to the transactions contemplated by this Subscription
Agreement.

 

    29

     

    

 

8.2 
Notwithstanding anything in this Subscription Agreement to the contrary, the SPAC shall not publicly disclose the name of Subscriber or
any of its affiliates, or include the name of Subscriber or any of its affiliates in any press release or in any filing with the Commission
or any regulatory agency or trading market, without the prior written consent of Subscriber, except (i) as required by the federal securities
law in connection with the Registration Statement, (ii) in a press release or marketing materials of the SPAC or the PubCo in connection
with the Mergers to the extent any such disclosure is substantially equivalent to the information that has previously been made public
without breach of the obligation under this Section 8.2 and (iii) to the extent such disclosure is required by law, at the request of
the Staff of the Commission or regulatory agency or under the regulations of Nasdaq, in which case the SPAC shall provide Subscriber with
prior written notice of such disclosure, and shall reasonably consult with the Subscriber regarding such disclosure.

 

9. Trust
Account Waiver. Subscriber acknowledges that the SPAC is a blank check company with the powers and privileges to effect a merger,
asset acquisition, reorganization or similar business combination involving the SPAC and one or more businesses or assets. Subscriber
further acknowledges that, as described in the Prospectus available at www.sec.gov, substantially all of the SPAC’s assets consist
of the cash proceeds of SPAC’s initial public offering (including overallotment securities sold by the SPAC’s underwriter
thereafter) and private placements of its securities, and substantially all of those proceeds have been deposited in a trust account (the
“Trust Account”) for the benefit of SPAC, its public shareholders and the underwriters of SPAC’s initial public
offering. Except with respect to interest earned on the funds held in the Trust Account that may be released to SPAC to pay its tax obligations,
if any, the cash in the Trust Account may be disbursed only for the purposes set forth in the Prospectus. For and in consideration of
the SPAC entering into this Subscription Agreement, the receipt and sufficiency of which are hereby acknowledged, Subscriber, on behalf
of itself and its representatives, hereby irrevocably waives any and all right, title and interest, or any claim of any kind they now
have or may have in the future, in or to any monies held in the Trust Account or distributions therefrom to the SPAC’s public stockholders,
and agrees not to seek recourse against the Trust Account for any claims in connection with, as a result of, or arising out of, this Subscription
Agreement or the transactions contemplated hereby; provided, however, that nothing in this Section 9 (x) shall serve
to limit or prohibit Subscriber’s right to pursue a claim against SPAC for legal relief against assets held outside the Trust Account
(other than distributions to the SPAC’s public stockholders), for specific performance or other equitable relief, (y) shall
serve to limit or prohibit any claims that Subscriber may have in the future against SPAC’s assets or funds that are not held in
the Trust Account (including any funds that have been released from the Trust Account (other than distributions to the SPAC’s public
stockholders) and any assets that have been purchased or acquired with any such funds) or (z) shall be deemed to limit any Subscriber’s
right, title, interest or claim to the Trust Account by virtue of such Subscriber’s record or beneficial ownership of securities
of the SPAC acquired by any means other than pursuant to this Subscription Agreement, including but not limited to any redemption right
with respect to any such securities of the SPAC.

 

[Signature Pages Follow]

 

    30

     

    

 

IN WITNESS WHEREOF,
each of the SPAC, the PubCo, and Subscriber has executed or caused this Subscription Agreement to be executed by its duly authorized representative
as of the date first set forth above.

 

	 	PACIFICO ACQUISITION CORP.
	 	 
	 	By:	 
	 	 	Name: 	Edward Cong Wang
	 	 	Title: 	Chief Executive Officer
	 	 	 
	 	CARAVELLE INTERNATIONAL GROUP
	 	 
	 	By:	 
	 	 	Name:	 Edward Cong Wang
	 	 	Title: 	Sole Director

 

	Acknowledged:	 
	 	 
	CARAVELLE GROUP CO., LTD	 
	 	 
	By:	 	 
	 	Name: 	Guohua Zhang	 
	 	Title: 	Chief Executive Officer	 

 

{Signature page to Subscription Agreement]

 

     

     

    

 

Accepted and agreed as of the date first set forth
above.

 

	SUBSCRIBER:	 	 	 
	 	 	 	 
	Name of Subscriber:	 	 Name of Joint Subscriber, if applicable
	 	 	 
	 	 	 
	{Please print}	 	{Please print}
	 	 	 
	Signature of Subscriber:	 	Signature of Joint Subscriber, if applicable:
	 	 	 
	By:	 	 	By:	 
	 	Name:	 	 	Name: 
	 	Title:	 	 	Title:

 

	If there are joint investors, please check one:	 	 
	☐   Joint Tenants with Rights of Survivorship	 	 
	☐   Community Property	 	 
	☐   Tenants-in-Common	 	 
	 	 	 
	Subscriber’s EIN:_______________________	 	Joint Subscriber’s EIN:___________________
	 	 	 
	Business Address-Street:	 	Mailing Address-Street (if different):
	_____________________________________	 	_____________________________________
	_____________________________________	 	_____________________________________
	 	 	 
	City, State, Zip:_________________________	 	City, State, Zip:__________________________
	Attn:_________________________________	 	Attn:__________________________________
	Telephone No.:__________________________	 	Telephone No.:__________________________
	Facsimile No:___________________________	 	Facsimile No:____________________________
	Email Address:__________________________	 	Email Address:__________________________

 

	Aggregate Number of shares of Securities subscribed for:__________________________________________________ 
	 	 
	Aggregate Purchase Price: $________________________	 

 

Subscriber must pay the Purchase Price by wire
transfer of U.S. dollars in immediately available funds to the account specified by the SPAC in the Closing Notice.

 

If Subscriber wants certificated Securities rather
than book-entry form, indicate here: ________

 

{Signature page to Subscription Agreement]

 

     

     

    

 

SCHEDULE A

ELIGIBILITY REPRESENTATIONS OF SUBSCRIBER

 

This Schedule A should be completed by
Subscriber

and constitutes a part of the Subscription Agreement.

 

		A.	QUALIFIED INSTITUTIONAL BUYER STATUS

 

(Please check the applicable subparagraphs):

 

		1.	☐	 Subscriber is a “qualified institutional buyer” (as defined in Rule 144A under the Securities Act of 1933, as amended (the
“Securities Act”) (a “QIB”)).

 

		2.	☐	 Subscriber is subscribing for the Securities as a fiduciary or agent for one or more investor accounts, and each owner of such account
is a QIB.

 

*** OR ***

 

		B.	INSTITUTIONAL ACCREDITED INVESTOR STATUS

 

(Please check the applicable subparagraphs):

 

		1.	☐	 Subscriber is an institutional “accredited investor” (within the meaning of Rule 501(a) under the Securities Act), and has
marked and initialed the appropriate box on the following page indicating the provision under which it qualifies as an institutional
“accredited investor.”

 

		2.	☐ 	Subscriber is not a natural person.

 

*** AND ***

 

		C.	AFFILIATE STATUS

 

(Please check the applicable box) SUBSCRIBER:

 

		☐	is:

		☐	is not

 

an “affiliate” (as defined in Rule 144 under
the Securities Act) of the SPAC or acting on behalf of an affiliate of the SPAC.

 

Rule 501(a), in relevant part, states that an
“accredited investor” shall mean any person who comes within any of the below listed categories, or who the issuer reasonably
believes comes within any of the below listed categories, at the time of the sale of the securities to that person. Subscriber has indicated,
by marking and initialing the appropriate box below, the provision(s) below which apply to Subscriber and under which Subscriber accordingly
qualifies as an “accredited investor.”

 

		☐	Any bank as defined in section 3(a)(2) of the Securities Act, or any savings and loan association or other
institution as defined in section 3(a)(5)(A) of the Securities Act whether acting in its individual or fiduciary capacity;

 

    Sch. A-1

     

    

 

		☐	Any broker or dealer registered pursuant to section 15 of the Exchange Act;

 

		☐	Any investment adviser registered pursuant to section 203 of the Investment Advisers Act of 1940 or registered
pursuant to the laws of a state;

 

		☐	Any investment adviser relying on the exemption from registering with the Commission under section 203(l)
or (m) of the Investment Advisers Act of 1940;

 

		☐	Any insurance company as defined in section 2(a)(13) of the Securities Act;

 

		☐	Any investment company registered under the Investment Company Act or a business development company as
defined in section 2(a) (48) of the Investment Company Act;

 

		☐	Any Small Business Investment Company licensed by the U.S. Small Business Administration under section
301(c) or (d) of the Small Business Investment Act of 1958;

 

		☐	Any Rural Business Investment Company as defined in section 384A of the Consolidated Farm and Rural Development
Act;

 

		☐	Any plan established and maintained by a state, its political subdivisions, or any agency or instrumentality
of a state or its political subdivisions for the benefit of its employees, if such plan has total assets in excess of $5,000,000;

 

		☐	Any employee benefit plan within the meaning of the Employee Retirement Income Security Act of 1974 (“ERISA”),
if (i) the investment decision is made by a plan fiduciary, as defined in section 3(21) of ERISA, which is either a bank, a savings and
loan association, an insurance company, or a registered investment adviser, (ii) the employee benefit plan has total assets in excess
of $5,000,000 or, (iii) the plan is a self-directed plan, with investment decisions made solely by persons that are “accredited
investors”;

 

		☐	Any private business development company as defined in section 202(a)(22) of the Investment Advisers Act
of 1940;

 

		☐	Any (i) corporation, limited liability company or partnership, (ii) Massachusetts or similar business
trust, or (iii) organization described in section 501(c)(3) of the Internal Revenue Code, in each case that was not formed for the specific
purpose of acquiring the securities offered and that has total assets in excess of $5,000,000;

    Sch. A-2

     

    

 

		☐	Any trust, with total assets in excess of $5,000,000, not formed for the specific purpose of acquiring
the securities offered, whose purchase is directed by a sophisticated person as described in section 230.506(b)(2)(ii) of Regulation D
under the Securities Act;

 

		☐	Any entity, other than an entity described in the categories of “accredited investors” above,
not formed for the specific purpose of acquiring the securities offered, owning investments in excess of $5,000,000;

 

		☐	Any “family office,” as defined under the Investment Advisers Act that satisfies all of the
following conditions: (i) with assets under management in excess of $5,000,000, (ii) that is not formed for the specific purpose of acquiring
the securities offered and (iii) whose prospective investment is directed by a person who has such knowledge and experience in financial
and business matters that such family office is capable of evaluating the merits and risks of the prospective investment;

 

		☐	Any “family client,” as defined under the Investment Advisers Act, of a family office meeting
the requirements in the previous paragraph and whose prospective investment in the PubCo is directed by such family office pursuant to
the previous paragraph; or

 

		☐	Any entity in which all of the equity owners are accredited investors.

 

		 ̈	I have an individual net worth, or joint net worth with my spouse or spousal equivalent, of more than $1,000,000 exclusive of the
value of my primary residence.

 

(For purposes of determining net worth, exclude
the value of your primary residence as well as the amount of indebtedness secured by your primary residence, up to the fair market value.
Any amount of such indebtedness secured in excess of the fair market value of your primary residence must be included as a liability.
In the event the indebtedness on your primary residence was increased in the 60 days preceding the completion of this Agreement, the amount
of the increase must be included as a liability in the net worth calculation. For this purpose, “joint net worth” can be the
aggregate net worth of the investor and spouse or spousal equivalent; assets need not be held jointly to be included in the calculation.
Reliance on the joint net worth standard described herein does not require that the securities be purchased jointly. For this purpose,
“spousal equivalent” means a cohabitant occupying a relationship generally equivalent to that of a spouse.)

 

		 ̈	I have an individual income in excess of $200,000, or joint income with my spouse or spousal equivalent in excess of $300,000, in
each of the 2 most recent years and I have a reasonable expectation of reaching the same income level in the current year.

 

		 ̈	I hold, in good standing, 1 or more professional certifications or designations or credentials from an accredited educational institution
that the SEC has designated as qualifying an individual for accredited investor status and which the SEC has posted as qualifying. (For
this purpose, the SEC has posted the following qualifying professional certifications: holders in good standing of FINRA Series 7, Series
65, and Series 82 licenses.)

 

 

Sch. A-3NEITHER THIS SECURITY NOR THE SECURITIES
FOR 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 AS EVIDENCED BY A LEGAL OPINION OF COUNSEL TO THE TRANSFEROR TO SUCH EFFECT, THE SUBSTANCE OF WHICH
SHALL BE REASONABLY ACCEPTABLE TO THE COMPANY. THIS SECURITY AND THE SECURITIES ISSUABLE UPON EXERCISE OF THIS SECURITY MAY BE PLEDGED
IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT OR OTHER LOAN SECURED BY SUCH SECURITIES.

 

COMMON STOCK
PURCHASE OPTION

IQSTEL INC.

Option No: IQST-AMG3c

Grant
Date: April 25, 2022

 

Option Shares: 4,800,000

Initial
Exercise Date: September 30, 2022

 

THIS COMMON STOCK PURCHASE
OPTION (the “Option”) certifies that, for value received, Apollo Management Group, Inc. or its assigns (the “Holder”)
is entitled, upon the terms and subject to the limitations on exercise and the conditions hereinafter set forth, at any time on or after
September 30, 2022, subject to the Company’s acceptance of a request by the Holder for an abatement of such date, which request
shall not be unreasonably withheld, delayed, denied, or conditioned (the “Initial Exercise Date”), and on or prior
to the close of business on the one-year anniversary of the Initial Exercise Date (the “Termination Date”) but not
thereafter, to subscribe for and purchase from IQSTEL Inc., a Nevada corporation (the “Company”), four million eight
hundred thousand (4,800,000) shares of Common Stock (in any event, as subject to adjustment hereunder, the “Option Shares”)
of Common Stock. The purchase price of one share of Common Stock under this Option shall be equal to the Exercise Price, as defined in
Section 2(b).

 

Section 1. Purchase
Price of this Option. The purchase price (the “Purchase Price”) of this Option is Five Hundred Thousand Dollars
($500,000.00), which sum the Holder tendered to the Company on or about the Grant Date.

 

Section 2.Exercise.

 

a)                                    
Exercise of Option. Exercise of the purchase rights represented by this Option may be made,
in whole or in part, at any time or times on or after the Initial Exercise Date and on or before the Termination Date by delivery to the
Company (or such other office or agency of the Company as it may designate by notice in writing to the registered Holder at the address
of the Holder appearing on the books of the Company) of a duly executed facsimile copy of the Notice of Exercise form annexed hereto as
Exhibit A and within three

(3) Trading Days of the date said Notice of
Exercise is delivered to the Company, the Company shall have received payment of the aggregate Exercise Price of the shares thereby purchased
by wire transfer or cashier’s check drawn on a United States bank or, if available,

 

    	 		 

    	 

    

pursuant to the cashless exercise procedure
specified in Section 2(c) below. No ink-original Notice of Exercise shall be required, nor shall any medallion guarantee (or other type
of guarantee or notarization) of any Notice of Exercise form be required. Notwithstanding anything herein to the contrary, the Holder
shall not be required to physically surrender this Option to the Company until the Holder has purchased all of the Option Shares available
hereunder and the Option has been exercised in full, in which case, the Holder shall surrender this Option to the Company for cancellation
within three (3) Trading Days of the date the final Notice of Exercise is delivered to the Company. Partial exercises of this Option resulting
in purchases of a portion of the total number of Option Shares available hereunder shall have the effect of lowering the outstanding number
of Option Shares purchasable hereunder in an amount equal to the applicable number of Option Shares purchased. The Holder and the Company
shall maintain records showing the number of Option Shares purchased and the date of such purchases. The Company shall deliver any objection
to any Notice of Exercise Form within one (1) Business Day of receipt of such notice. Notwithstanding anything herein to the contrary,
the maximum number of separate exercises of this Option shall be four (4). The Holder and any assignee, by acceptance of this Option,
acknowledge and agree that, by reason of the provisions of this paragraph, following the purchase of a portion of the Option Shares hereunder,
the number of Option Shares available for purchase hereunder at any given time may be less than the amount stated on the face hereof.

 

b)                                  
Exercise Price. The exercise price per share of the Common Stock under this Option shall be
$2.00 (the “Exercise Price”).

 

c)                                    
Cashless Exercise. If at the time of any exercise, the Option Shares are not subject to an
effective registration statement, this Option may be exercised, in whole or in part, at any time (subject to the provisions of the first
paragraph of this Option) or from time to time (limited to a maximum of four exercises, which maximum exercise limitation also includes
any exercises for cash) by means of a “cashless exercise” in which the Holder shall be entitled to receive a number of Option
Shares equal to the quotient obtained by dividing [(A-B) (X)] by (A), where:

 

(A) = the daily average
of the VWAP for the shares of Common Stock for the 10 Trading Days immediately preceding the date on which Holder elects to exercise this
Option by means of a “cashless exercise,” as set forth in the applicable Notice of Exercise;

 

(B) = the Exercise Price of this Option, as adjusted hereunder;
and

 

(X) = the number
of Option Shares that would be issuable upon exercise of this Option in accordance with the terms of this Option if such exercise were
by means of a cash exercise rather than a cashless exercise.

 

		d)	Mechanics of Exercise.

 

i.                       
Delivery of Option Shares Upon Exercise. Option Shares purchased hereunder shall be transmitted
by the Transfer Agent to the Holder by crediting the account of the Holder’s prime broker with The Depository Trust Company through
its Deposit or Withdrawal at Custodian system (“DWAC”) if the Company is then a participant in such system and either
(A) there is an effective registration statement permitting the issuance of the Option Shares to or resale of the Option Shares by the
Holder or

 

    	 	2	 

    	 

    

(B) the shares are eligible for resale
by the Holder without volume or manner-of-sale limitations pursuant to Rule 144, and otherwise by physical delivery to the address specified
by the Holder in the Notice of Exercise by the date that is ten (10) Trading Days after the latest of (A) the delivery to the Company
of the Notice of Exercise and (B) surrender of this Option (if required) (such date, the “Option Share Delivery Date”).
The Option Shares shall be deemed to have been issued, and Holder or any other person so designated to be named therein shall be deemed
to have become a holder of record of such shares for all purposes, as of the date the Option has been exercised, with payment to the Company
of the Exercise Price (or by cashless exercise, if permitted) and all taxes required to be paid by the Holder, if any, pursuant to Section
2(d)(vi) prior to the issuance of such shares, having been paid. If the Company fails for any reason to deliver to the Holder the Option
Shares subject to a Notice of Exercise by the Option Share Delivery Date, the Company shall pay to the Holder, in cash, as liquidated
damages and not as a penalty, for each $1,000 of Option Shares subject to such exercise (based on the VWAP of the Common Stock on the
date of the applicable Notice of Exercise), $10 per Trading Day (increasing to $20 per Trading Day on the fifth Trading Day after such
liquidated damages begin to accrue) for each Trading Day after such Option Share Delivery Date until such Option Shares are delivered
or Holder rescinds such exercise.

 

ii.                                        
Delivery of New Options Upon Exercise. If this Option shall have been exercised in part, the
Company shall, at the request of a Holder and upon surrender of this Option certificate, at the time of delivery of the Option Shares,
deliver to the Holder a new Option evidencing the rights of the Holder to purchase the unpurchased Option Shares called for by this Option,
which new Option shall in all other respects be identical with this Option.

 

iii.                                   
Rescission Rights. If the Company fails to cause the Transfer Agent to transmit to the Holder
the Option Shares pursuant to Section 2(d)(i) by the Option Share Delivery Date, then the Holder will have the right to rescind such exercise.

 

iv.                                  
Compensation for Buy-In on Failure to Timely Deliver Option Shares Upon Exercise. In addition
to any other rights available to the Holder, if the Company fails to cause the Transfer Agent to transmit to the Holder the Option Shares
pursuant to an exercise on or before the Option Share Delivery Date, and if after such date the Holder is required by its broker to purchase
(in an open market transaction or otherwise) or the Holder’s brokerage firm otherwise purchases, shares of Common Stock to deliver
in satisfaction of a sale by the Holder of the Option Shares which the Holder anticipated receiving upon such exercise (a “Buy-In”),
then the Company shall (A) pay in cash to the Holder the amount, if any, by which

(x) the Holder’s total purchase price
(including brokerage commissions, if any) for the shares of Common Stock so purchased exceeds (y) the amount obtained by multiplying (1)
the number of Option Shares that the Company was required to deliver to the Holder in connection with the exercise at issue times (2)
the price at which the sell order giving rise to such purchase

 

    	 	3	 

    	 

    

obligation was executed, and (B) at the
option of the Holder, either reinstate the portion of the Option and equivalent number of Option Shares for which such exercise was not
honored (in which case such exercise shall be deemed rescinded) or deliver to the Holder the number of shares of Common Stock that would
have been issued had the Company timely complied with its exercise and delivery obligations hereunder. For example, if the Holder purchases
Common Stock having a total purchase price of

$11,000 to cover a Buy-In with respect to
an attempted exercise of shares of Common Stock with an aggregate sale price giving rise to such purchase obligation of $10,000, under
clause (A) of the immediately preceding sentence the Company shall be required to pay the Holder $1,000. The Holder shall provide the
Company written notice indicating the amounts payable to the Holder in respect of the Buy-In and, upon request of the Company, evidence
of the amount of such loss. Nothing herein shall limit a Holder’s right to pursue any other remedies available to it hereunder,
at law or in equity including, without limitation, a decree of specific performance and/or injunctive relief with respect to the Company’s
failure to timely deliver shares of Common Stock upon exercise of the Option as required pursuant to the terms hereof.

 

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

 

vi.                                  
Charges, Taxes, and Expenses. Issuance of Option Shares shall be made without charge to the
Holder for any issue or transfer tax or other incidental expense in respect of the issuance of Option Shares, all of which taxes and expenses
shall be paid by the Company, and such Option Shares shall be issued in the name of the Holder or in such name or names as may be directed
by the Holder; provided, however, that in the event that Option Shares are to be issued in a name other than the name of
the Holder, this Option when surrendered for exercise shall be accompanied by the Assignment Form attached hereto as Exhibit B duly executed
by the Holder and the Company may require, as a condition thereto, the payment of a sum sufficient to reimburse it for any transfer tax
incidental thereto. The Company shall pay all Transfer Agent fees required for same-day processing of any Notice of Exercise.

 

vii.                                   
Closing of Books. The Company will not close its stockholder books or records in any manner
that prevents the timely exercise of this Option, pursuant to the terms hereof.

 

e)                                    
Holder’s Exercise Limitations. The Company shall not effect any exercise of this Option,
and a Holder shall not have the right to exercise any portion of this Option, pursuant to Section 2 or otherwise, to the extent that after
giving effect to such issuance after exercise as set forth on the applicable Notice of Exercise, the Holder (together with the Holder’s
Affiliates, and any other Persons acting as a group

 

    	 	4	 

    	 

    

together with the Holder or any of the
Holder’s Affiliates), would beneficially own in excess of the Beneficial Ownership Limitation (as defined below). For purposes of
the foregoing sentence, the number of shares of Common Stock beneficially owned by the Holder and its Affiliates shall include the number
of shares of Common Stock issuable upon exercise of this Option with respect to which such determination is being made, but shall exclude
the number of shares of Common Stock which would be issuable upon (i) exercise of the remaining, nonexercised portion of this Option beneficially
owned by the Holder or any of its Affiliates and (ii) exercise or conversion of the unexercised or nonconverted portion of any other securities
of the Company (including, without limitation, any other “Common Stock Equivalents”1) subject to a limitation on
conversion or exercise analogous to the limitation contained herein beneficially owned by the Holder or any of its Affiliates. Except
as set forth in the preceding sentence, for purposes of this Section 2(e), beneficial ownership shall be calculated in accordance with
Section 13(d) of the Exchange Act and the rules and regulations promulgated thereunder, it being acknowledged by the Holder that the Company
is not representing to the Holder that such calculation is in compliance with Section 13(d) of the Exchange Act and the Holder is solely
responsible for any schedules required to be filed in accordance therewith. To the extent that the limitation contained in this Section
2(e) applies, the determination of whether this Option is exercisable (in relation to other securities owned by the Holder together with
any Affiliates) and of which portion of this Option is exercisable shall be in the sole discretion of the Holder, and the submission of
a Notice of Exercise shall be deemed to be the Holder’s determination of whether this Option is exercisable (in relation to other
securities owned by the Holder together with any Affiliates) and of which portion of this Option is exercisable, in each case subject
to the Beneficial Ownership Limitation, and the Company shall have no obligation to verify or confirm
the accuracy of such determination. In addition, a determination as to any group status as contemplated above shall be determined
in accordance with Section 13(d) of the Exchange Act and the rules and regulations promulgated thereunder. For purposes of this Section
2(e), in determining the number of outstanding shares of Common Stock, a Holder may rely on the number of outstanding shares of Common
Stock as reflected in (A) the Company’s most recent periodic or annual report filed with the Commission, as the case may be, (B)
a more recent public announcement by the Company or (C) a more recent written notice by the Company or the Transfer Agent setting forth
the number of shares of Common Stock outstanding. Upon the written or oral request of a Holder, the Company shall within two Trading Days
confirm orally and in writing to the Holder the number of shares of Common Stock then outstanding. In any case, the number of outstanding
shares of Common Stock shall be determined after giving effect to the conversion or exercise of securities of the Company, including this
Option, by the Holder or its Affiliates since the date as of which such number of outstanding shares of Common Stock was reported. The
“Beneficial Ownership Limitation” shall be 4.99% of the number of shares of the Common Stock outstanding immediately
after giving effect to the issuance of shares of Common Stock issuable upon exercise of this Option. The Holder, upon not less than 61
days’ prior notice to the Company, may increase or decrease the Beneficial Ownership Limitation provisions of this Section 2(e),
provided that the Beneficial Ownership Limitation in no event exceeds 9.99% of the number of shares of the Common Stock outstanding

 

 

1
“Common Stock Equivalents” means any securities of the Company that would entitle the holder
thereof to acquire at any time Common Stock, 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,
shares of Common Stock.

 

    	 	5	 

    	 

    

immediately after giving effect to the
issuance of shares of Common Stock upon exercise of this Option held by the Holder and the provisions of this Section 2(e) shall continue
to apply. Any such increase or decrease will not be effective until the 61st day after such notice is delivered to the Company.
The provisions of this paragraph shall be construed and implemented in a manner otherwise than in strict conformity with the terms of
this Section 2(e) to correct this paragraph (or any portion hereof) which may be defective or inconsistent with the intended Beneficial
Ownership Limitation herein contained or to make changes or supplements necessary or desirable to properly give effect to such limitation.
The limitations contained in this paragraph shall apply to a successor holder of this Option.

 

Section 3.Certain
Adjustments.

 

a)                                    
Stock Dividends and Splits. If the Company, at any time while this Option is outstanding:
(i) pays a stock dividend or otherwise makes a distribution or distributions on shares of its Common Stock or any other equity or equity
equivalent securities payable in shares of Common Stock (which, for avoidance of doubt, shall not include any shares of Common Stock issued
by the Company upon exercise of this Option), (ii) subdivides outstanding shares of Common Stock into a larger number of shares, (iii)
combines (including by way of reverse stock split) outstanding shares of Common Stock into a smaller number of shares, or (iv) issues
by reclassification of shares of the Common Stock any shares of capital stock of the Company, then in each case the Exercise Price shall
be multiplied by a fraction of which the numerator shall be the number of shares of Common Stock (excluding treasury shares, if any) outstanding
immediately before such event and of which the denominator shall be the number of shares of Common Stock outstanding immediately after
such event, and the number of shares issuable upon exercise of this Option shall be proportionately adjusted such that the aggregate Exercise
Price of this Option shall remain unchanged. Any adjustment made pursuant to this Section 3(a) shall become effective immediately after
the record date for the determination of stockholders entitled to receive such dividend or distribution and shall become effective immediately
after the effective date in the case of a subdivision, combination or re-classification.

 

b)                                  
Subsequent Primary Equity Sales. If the Company or any Subsidiary thereof, as applicable,
at any time while this Option is outstanding, shall sell or grant any option to purchase, or sell or grant any right to reprice, or otherwise
dispose of or issue (or announce any offer, sale, grant or any option to purchase or other disposition) any Common Stock or Common Stock
Equivalents, at an effective price per share less than the Exercise Price then in effect (such lower price, the “Base Share Price”
and such issuances collectively, a “Dilutive Issuance”) (it being understood and agreed that if the holder of the Common
Stock or Common Stock Equivalents so issued shall at any time, whether by operation of purchase price adjustments, reset provisions, floating
conversion, exercise or exchange prices or otherwise, or due to options, options or rights per share that are issued in connection with
such issuance, be entitled to receive shares of Common Stock at an effective price per share that is less than the Exercise Price, such
issuance shall be deemed to have occurred for less than the Exercise Price on such date of the Dilutive Issuance at such effective price),
then simultaneously with the consummation of each Dilutive Issuance the Exercise Price shall be reduced and only reduced to equal the
Base Share Price and the number of Option Shares issuable hereunder shall be increased such that the aggregate Exercise Price payable
hereunder, after taking into account the decrease in the Exercise Price, shall be equal to the aggregate Exercise Price prior to such
adjustment. Such adjustment shall be made whenever such Common Stock or Common Stock Equivalents are issued. Notwithstanding the foregoing,

 

    	 	6	 

    	 

    

no adjustments shall be made, paid, or
issued under this Section 3(b) in respect of an Exempt Issuance. The Company shall notify the Holder, in writing, no later than the Trading
Day following the issuance or deemed issuance of any Common Stock or Common Stock Equivalents subject to this Section 3(b), indicating
therein the applicable issuance price, or applicable reset price, exchange price, conversion price and other pricing terms (such notice,
the “Dilutive Issuance Notice”). For purposes of clarification, whether or not the Company provides a Dilutive Issuance
Notice pursuant to this Section 3(b), upon the occurrence of any Dilutive Issuance, the Holder is entitled to receive a number of Option
Shares based upon the Base Share Price regardless of whether the Holder accurately refers to the Base Share Price in the Notice of Exercise.
If the Company enters into a “Variable Rate Transaction2,” the Company shall be deemed to have issued Common Stock
or Common Stock Equivalents at the lowest possible conversion or exercise price at which such securities may be converted or exercised.
Notwithstanding anything to the contrary contained in this Section 3(b), the Base Share Price shall not be less than ten cents ($0.136).

 

c)                                    
Subsequent Secondary Equity Sales.
If the daily average of the VWAP3 for the shares of Common Stock for the 10 Trading Days immediately prior to an exercise of
the Option in whole or in part (the “VWAP Average Price”) is less than $2.00, then the then- current Exercise Price
shall be temporarily reduced for such exercise to an amount that is calculated in accordance with the dynamic Excel spreadsheet that accompanies
the execution copy of this Agreement (and certain static versions thereof are attached as Schedule A) and, in each such case, as calculated,
the number of Option Shares issuable hereunder solely for such exercise shall be increased in accordance with the formula set forth in
such dynamic Excel spreadsheet (such additional Option Shares, a “Sub-option”).4 The Holder need not exercise
such Sub-option in respect of such additional shares of Common Stock concurrently with the subject exercise and may exercise such Sub-option
in whole or in part at any time or

 

 

2
“Variable Rate Transaction” means, either or both of (a) an “Equity Line of Credit”
or similar agreement or (b) a Variable Priced Equity Linked Instrument. For purposes hereof, (i) “Equity Line of Credit” means
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 future determined price or price
formula (other than customary “preemptive” or “participation” rights or “weighted average” or “full-ratchet”
anti- dilution provisions or in connection with fixed-price rights offerings and similar transactions that are not Variable Priced Equity
Linked Instruments) and (ii) “Variable Priced Equity Linked Instruments” means: (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 conversion, exercise, or exchange
price that is subject to being reset on more than one occasion 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 (other than
customary “preemptive” or “participation” rights or “weighted average” or “full-ratchet”
anti-dilution provisions or in connection with fixed-price rights offerings and similar transactions) and (B) any amortizing convertible
security that amortizes prior to its maturity date, in which 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 that 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 shares of Common Stock are subject to certain equity conditions).

3
“VWAP” means, for or as of any date, the dollar volume-weighted average price for the Common
Stock on the principal securities exchange or securities market on which the Common Stock is then traded) during the period beginning
at 9:30:01 a.m., New York time, and ending at 4:00:00 p.m., New York time, as reported by Bloomberg through its “HP” function
(set to weighted average) or, if the foregoing does not apply, the dollar volume-weighted average price of the Common Stock in the over-the-counter
market on the OTC Markets Group Inc. marketplace for the Common Stock during the period beginning at 9:30:01 a.m., New York time, and
ending at 4:00:00 p.m., New York time, as reported by Bloomberg, or, if no dollar volume-weighted average price is reported for the Common
Stock by Bloomberg for such hours, the average of the highest closing bid price and the lowest closing ask price of any of the market
makers for the Common Stock as reported by OTC Markets Group Inc. If the VWAP cannot be calculated for the Common Stock on such date on
any of the foregoing bases, the VWAP of the Common Stock on such date shall be the fair market value as mutually determined by the Company
and the Holder. All such determinations shall be appropriately adjusted for any stock dividend, stock split, stock combination, recapitalization,
or other similar transaction during such period.

4
A series of static Excel spreadsheets are attached as Schedule A, the embedded formula in which demonstrates
the calculation of the number of additional option shares that may result from changes to the VWAP Average Price. On the dynamic Excel
spreadsheet, the number of additional option shares has a collar that provides that the VWAP Average Price cannot exceed $2.00 and cannot
be less than approximately $0.140759; accordingly, it does not provide for any adjustment outside of the collar. The cap takes into account
the $2.00 referenced in this Section 3(c) and the approximate $0.140759 floor takes into account the $0.10 minimum temporary Exercise
Price. The static Excel spreadsheets also assume (but the dynamic Excel spreadsheet does not assume) that the entire option is exercised
all at once and provide a formulaic guidepost for the calculations (utilizing the dynamic Excel spreadsheet) of the number of additional
option shares issuable in the event of multiple partial exercises.

 

    	 	7	 

    	 

    

from time-to-time thereafter through the
Termination Date. Immediately upon such initial exercise at the temporarily reduced Exercise Price, the Exercise Price for the balance
of this Option shall be increased to an amount equivalent to the then-current Exercise Price immediately preceding such exercise. Notwithstanding
anything to the contrary contained in this Section 3(c), the temporarily reduced Exercise Price shall not be less than ten cents ($0.136).

 

		d)	Reserved.

 

e)                                    
Pro Rata Distributions. During such time as this Option is outstanding, if the Company shall
declare or make any dividend or other distribution of its assets (or rights to acquire its assets) to holders of shares of Common Stock,
by way of return of capital or otherwise (including, without limitation, any distribution of cash, stock or other securities, property
or options by way of a dividend, spin off, reclassification, corporate rearrangement, scheme of arrangement or other similar transaction)
(a “Distribution”), at any time after the issuance of this Option, then, in each such case, the Holder shall be entitled
to participate in such Distribution to the same extent that the Holder would have participated therein if the Holder had held the number
of shares of Common Stock acquirable upon complete exercise of this Option (without regard to any limitations on exercise hereof, including
without limitation, the Beneficial Ownership Limitation) immediately before the date of which a record is taken for such Distribution,
or, if no such record is taken, the date as of which the record holders of shares of Common Stock are to be determined for the participation
in such Distribution (provided, however, to the extent that the Holder’s right to participate in any such Distribution
would result in the Holder exceeding the Beneficial Ownership Limitation, then the Holder shall not be entitled to participate in such
Distribution to such extent (or in the beneficial ownership of any shares of Common Stock as a result of such Distribution to such extent)
and the portion of such Distribution shall be held in abeyance for the benefit of the Holder until such time, if ever, as its right thereto
would not result in the Holder exceeding the Beneficial Ownership Limitation).

 

		f)	Fundamental Transaction. If, at any time while this Option is outstanding,

(i) the Company, directly or indirectly,
in one or more related transactions effects any merger or consolidation of the Company with or into another Person, (ii) the Company,
directly or indirectly, effects any sale, lease, license, assignment, transfer, conveyance or other disposition of all or substantially
all of its assets in one or a series of related transactions, (iii) any, direct or indirect, purchase offer, tender offer or exchange
offer (whether by the Company or another Person) is completed pursuant to which holders of Common Stock are permitted to sell, tender
or exchange their shares for other securities, cash or property and has been accepted by the holders of 50% or more of the outstanding
Common Stock, (iv) the Company, directly or indirectly, in one or more related transactions effects any reclassification, reorganization
or recapitalization of the Common Stock or any compulsory share exchange pursuant to which the Common Stock is effectively converted into
or exchanged for other securities, cash or property, or (v) the Company, directly or indirectly, in one or more related transactions consummates
a stock or share purchase agreement or other business combination (including, without limitation, a reorganization, recapitalization,
spin-off or scheme of arrangement) with another Person or group of Persons whereby such other Person or group acquires more than 50% of
the outstanding shares of Common Stock (not including any shares of Common Stock held by the other Person or other Persons making or party
to, or associated or affiliated with the other Persons making or party to, such stock or share purchase agreement or other business combination)
(each, a “Fundamental Transaction”), then, upon any subsequent exercise of this Option, the Holder shall have the right
to receive, for each Option

 

    	 	8	 

    	 

    

Share that would have been issuable upon
such exercise immediately prior to the occurrence of such Fundamental Transaction, at the option of the Holder (without regard to any
limitation in Section 2(e) on the exercise of this Option), the number of shares of Common Stock of the successor or acquiring corporation
or of the Company, if it is the surviving corporation, and any additional consideration (the “Alternate Consideration”)
receivable as a result of such Fundamental Transaction by a holder of the number of shares of Common Stock for which this Option is exercisable
immediately prior to such Fundamental Transaction (without regard to any limitation in Section 2(e) on the exercise of this Option). For
purposes of any such exercise, the determination of the Exercise Price shall be appropriately adjusted to apply to such Alternate Consideration
based on the amount of Alternate Consideration issuable in respect of one share of Common Stock in such Fundamental Transaction, and the
Company shall apportion the Exercise Price among the Alternate Consideration in a reasonable manner reflecting the relative value of any
different components of the Alternate Consideration. If holders of Common Stock are given any choice as to the securities, cash, or property
to be received in a Fundamental Transaction, then the Holder shall be given the same choice as to the Alternate Consideration it receives
upon any exercise of this Option following such Fundamental Transaction. Notwithstanding anything to the contrary, in the event of a Fundamental
Transaction, the Company or any Successor Entity (as defined below) shall, at the Holder’s option, exercisable at any time concurrently
with, or within 30 days after, the consummation of the Fundamental Transaction, purchase this Option from the Holder by paying to the
Holder an amount of cash equal to the Black Scholes Value of the remaining unexercised portion of this Option on the date of the consummation
of such Fundamental Transaction. “Black Scholes Value” means the value of this Option based on the Black and Scholes
Option Pricing Model obtained from the “OV” function on Bloomberg, L.P. (“Bloomberg”) determined as of
the day of consummation of the applicable Fundamental Transaction for pricing purposes and reflecting (A) a risk-free interest rate corresponding
to the U.S. Treasury rate for a period equal to the time between the date of the public announcement of the applicable Fundamental Transaction
and the Termination Date, (B) an expected volatility equal to the greater of 100% and the 100 day volatility obtained from the HVT function
on Bloomberg as of the Trading Day immediately following the public announcement of the applicable Fundamental Transaction, (C) the underlying
price per share used in such calculation shall be the sum of the price per share being offered in cash, if any, plus the value of any
non-cash consideration, if any, being offered in such Fundamental Transaction and (D) a remaining option time equal to the time between
the date of the public announcement of the applicable Fundamental Transaction and the Termination Date. The Company shall cause any successor
entity in a Fundamental Transaction in which the Company is not the survivor (the “Successor Entity”) to assume in
writing all of the obligations of the Company under this Option and the other Transaction Documents in accordance with the provisions
of this Section 3(e) pursuant to written agreements in form and substance reasonably satisfactory to the Holder and approved by the Holder
(without unreasonable delay) prior to such Fundamental Transaction and shall, at the option of the Holder, deliver to the Holder in exchange
for this Option a security of the Successor Entity evidenced by a written instrument substantially similar in form and substance to this
Option which is exercisable for a corresponding number of shares of capital stock of such Successor Entity (or its parent entity) equivalent
to the shares of Common Stock acquirable and receivable upon exercise of this Option (without regard to any limitations on the exercise
of this Option) prior to such Fundamental Transaction, and with an exercise price which applies the exercise price hereunder to such shares
of capital stock (but taking into account the relative value of the shares of Common Stock pursuant to such Fundamental Transaction and
the value of such shares of capital stock, such number of shares of capital stock and such exercise price being

 

    	 	9	 

    	 

    

for the purpose of protecting the economic
value of this Option immediately prior to the consummation of such Fundamental Transaction), and which is reasonably satisfactory in form
and substance to the Holder. Upon the occurrence of any such Fundamental Transaction, the Successor Entity shall succeed to, and be substituted
for (so that from and after the date of such Fundamental Transaction, the provisions of this Option and the other Transaction Documents
referring to the “Company” shall refer instead to the Successor Entity), and may exercise every right and power of the Company
and shall assume all of the obligations of the Company under this Option and the other Transaction Documents with the same effect as if
such Successor Entity had been named as the Company herein.

 

g)                                   
Calculations. All calculations under this Section 3 shall be made to the nearest cent or the
nearest 1/100th of a share, as the case may be. For purposes of this Section 3, the number of shares of Common Stock deemed to be issued
and outstanding as of a given date shall be the sum of the number of shares of Common Stock (excluding treasury shares, if any) issued
and outstanding.

 

		h)	Notice to Holder.

 

i.                       
Adjustment to Exercise Price. Whenever the Exercise Price is adjusted pursuant to any provision
of this Section 3, the Company shall promptly mail to the Holder a notice setting forth the Exercise Price after such adjustment and any
resulting adjustment to the number of Option Shares and setting forth a brief statement of the facts requiring such adjustment.

 

ii.                       
Notice to Allow Exercise by Holder. If (A) the Company shall declare a dividend (or any other
distribution in whatever form) on the Common Stock, (B) the Company shall declare a special nonrecurring cash dividend on or a redemption
of the Common Stock, (C) the Company shall authorize the granting to all holders of the Common Stock rights or options to subscribe for
or purchase any shares of capital stock of any class or of any rights, (D) the approval of any stockholders of the Company shall be required
in connection with any reclassification of the Common Stock, any consolidation or merger to which the Company is a party, any sale or
transfer of all or substantially all of the assets of the Company, or any compulsory share exchange whereby the Common Stock is converted
into other securities, cash or property, or (E) the Company shall authorize the voluntary or involuntary dissolution, liquidation or winding
up of the affairs of the Company, then, in each case, the Company shall cause to be mailed to the Holder at its last address as it shall
appear upon the Option Register of the Company, at least 20 calendar days prior to the applicable record or effective date hereinafter
specified, a notice stating (x) the date on which a record is to be taken for the purpose of such dividend, distribution, redemption,
rights or options, or if a record is not to be taken, the date as of which the holders of the Common Stock of record to be entitled to
such dividend, distributions, redemption, rights or options are to be determined or (y) the date on which such reclassification, consolidation,
merger, sale, transfer or share exchange is expected to become effective or close, and the date as of which it is expected that holders
of the Common Stock of record shall be entitled to exchange their shares of the Common Stock for securities, cash or other property deliverable
upon such reclassification, consolidation, merger, sale, transfer, or share exchange; provided that the failure to mail such notice or
any defect therein or

 

    	 	10	 

    	 

    

in the mailing thereof shall not affect
the validity of the corporate action required to be specified in such notice. To the extent that any notice provided hereunder constitutes,
or contains, material, non-public information regarding the Company or any of the Subsidiaries, the Company shall simultaneously file
such notice with the Commission pursuant to a Current Report on Form 8-K. The Holder shall remain entitled to exercise this Option during
the period commencing on the date of such notice to the effective date of the event triggering such notice except as may otherwise be
expressly set forth herein.

 

Section 4.Transfer
of Option.

 

a)                                    
Transferability. This Option and all rights hereunder (including, without limitation, any
registration rights) are transferable, in whole or in part, upon surrender of this Option at the principal office of the Company or its
designated agent, together with a written assignment of this Option substantially in the form attached hereto duly executed by the Holder
or its agent or attorney and funds sufficient to pay any transfer taxes payable upon the making of such transfer. Upon such surrender
and, if required, such payment, the Company shall execute and deliver a new Option or Options in the name of the assignee or assignees,
as applicable, and in the denomination or denominations specified in such instrument of assignment, and shall issue to the assignor a
new Option evidencing the portion of this Option not so assigned, and this Option shall promptly be cancelled. Notwithstanding anything
herein to the contrary, the Holder shall not be required to physically surrender this Option to the Company unless the Holder has assigned
this Option in full, in which case, the Holder shall surrender this Option to the Company within three (3) Trading Days of the date the
Holder delivers an assignment form to the Company assigning this Option full. The Option, if properly assigned in accordance herewith,
may be exercised by a new holder for the purchase of Option Shares without having a new Option issued.

 

b)                                  
New Options. This Option may be divided or combined with other Options upon presentation hereof
at the aforesaid office of the Company, together with a written notice specifying the names and denominations in which new Options are
to be issued, signed by the Holder or its agent or attorney. Subject to compliance with Section 4(a), as to any transfer which may be
involved in such division or combination, the Company shall execute and deliver a new Option or Options in exchange for the Option or
Options to be divided or combined in accordance with such notice. All Options issued on transfers or exchanges shall be dated the Initial
Exercise Date and shall be identical with this Option except as to the number of Option Shares issuable pursuant thereto.

 

c)                                    
Option Register. The Company shall register this Option, upon records to be maintained by
the Company for that purpose (the “Option Register”), in the name of the record Holder hereof from time to time. The
Company may deem and treat the registered Holder of this Option as the absolute owner hereof for the purpose of any exercise hereof or
any distribution to the Holder, and for all other purposes, absent actual notice to the contrary.

 

d)                                  
Transfer Restrictions. If, at the time of the surrender of this Option in connection with
any transfer of this Option, the transfer of this Option shall not be either (i) registered pursuant to an effective registration statement
under the Securities Act and under applicable state securities or blue sky laws or (ii) eligible for resale without volume or manner-
of-sale restrictions or current public information requirements pursuant to Rule 144, the Company may require, as a condition of allowing
such transfer, that the transferee of this Option shall agree in writing to be bound by the terms hereof and
shall have the rights and obligations of a holder of this Option.

 

    	 	11	 

    	 

    

e)                                    
Representation by the Holder. The Holder, by the acceptance hereof, represents and options
that it is acquiring this Option and, upon any exercise hereof, will acquire the Option Shares issuable upon such exercise, for its own
account and not with a view to or for distributing or reselling such Option Shares or any part thereof in violation of the Securities
Act or any applicable state securities law, except pursuant to sales registered or exempted under the Securities Act.

 

Section 5.Miscellaneous.

 

a)                                    
No Rights as Stockholder Until Exercise. This Option does not entitle the Holder to any voting
rights, dividends, or other rights as a stockholder of the Company prior to the exercise hereof as set forth in Section 2(d)(i), except
as expressly set forth in Section 3.

 

b)                                  
Loss, Theft, Destruction, or Mutilation of Option. The Company covenants that upon receipt
by the Company of evidence reasonably satisfactory to it of the loss, theft, destruction or mutilation of this Option or any stock certificate
relating to the Option Shares, and in case of loss, theft or destruction, of indemnity or security reasonably satisfactory to it (which,
in the case of the Option, shall not include the posting of any bond), and upon surrender and cancellation of such Option or stock certificate,
if mutilated, the Company will make and deliver a new Option or stock certificate of like tenor and dated as of such cancellation, in
lieu of such Option or stock certificate.

 

c)                                    
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 Business Day, then, such action may be taken or such right may
be exercised on the next succeeding Business Day.

 

		d)	Authorized Shares.

 

The Company covenants that,
during the period the Option is outstanding, it will reserve from its authorized and unissued Common Stock a sufficient number of shares
to provide for the issuance of the Option Shares upon the exercise of any purchase rights under this Option. The Company further covenants
that its issuance of this Option shall constitute full authority to its officers who are charged with the duty of issuing the necessary
Option Shares upon the exercise of the purchase rights under this Option. The Company will take all such reasonable action as may be necessary
to assure that such Option Shares may be issued as provided herein without violation of any applicable law or regulation, or of any requirements
of the Trading Market upon which the Common Stock may be listed. The Company covenants that all Option Shares which may be issued upon
the exercise of the purchase rights represented by this Option will, upon exercise of the purchase rights represented by this Option and
payment for such Option Shares in accordance herewith, be duly authorized, validly issued, fully paid and nonassessable and free from
all taxes, liens and charges created by the Company in respect of the issue thereof (other than taxes in respect of any transfer occurring
contemporaneously with such issue).

 

    	 	12	 

    	 

    

Except and to the
extent as waived or consented to by the Holder, the Company shall not by any action, including, without limitation, amending its certificate
of incorporation or through any reorganization, transfer of assets, consolidation, merger, 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 Option, but will at all times
in good faith assist in the carrying out of all such terms and in the taking of all such actions as may be necessary or appropriate to
protect the rights of Holder as set forth in this Option against impairment. Without limiting the generality of the foregoing, the Company
will (i) not increase the par value of any Option Shares above the amount payable therefor upon such exercise immediately prior to such
increase in par value, (ii) take all such action as may be necessary or appropriate in order that the Company may validly and legally
issue fully paid and nonassessable Option Shares upon the exercise of this Option, and (iii) use commercially reasonable efforts to obtain
all such authorizations, exemptions or consents from any public regulatory body having jurisdiction thereof, as may be, necessary to enable
the Company to perform its obligations under this Option.

 

Before taking any action
which would result in an adjustment in the number of Option Shares for which this Option is exercisable or in the Exercise Price, the
Company shall obtain all such authorizations or exemptions thereof, or consents thereto, as may be necessary from any public regulatory
body or bodies having jurisdiction thereof.

 

e)                                    
Jurisdiction. This Option shall be governed by and construed in accordance with the laws of
the State of Florida, without giving effect to conflicts of laws thereof. Each of the parties consents to the jurisdiction of the Courts
of the State of Florida located in the City of Miami, County of Miami-Dade, and the U.S. District Court for the Southern District of Florida
in connection with any dispute arising under this Option and hereby waives, to the maximum extent permitted by law, any objection, including
any objection based on forum non conveniens, to the bringing of any such proceeding in such jurisdictions. THE PARTIES HEREBY KNOWINGLY,
VOLUNTARILY, AND INTENTIONALLY WAIVE THE RIGHT ANY OF THEM MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION BASED HEREON OR ARISING
OUT OF, UNDER OR IN CONNECTION WITH THIS OPTION OR ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS (WHETHER VERBAL OR WRITTEN), OR
ACTIONS OF ANY PARTY. THIS PROVISION IS A MATERIAL INDUCEMENT FOR THE PARTIES’ ACCEPTANCE OF THIS AGREEMENT.

 

f)                                     
Restrictions. The Holder acknowledges that the Option Shares acquired upon the exercise of
this Option, if not registered and the Holder does not utilize cashless exercise, will have restrictions upon resale imposed by state
and federal securities laws.

 

g)                                   
Nonwaiver and Expenses. No course of dealing or any delay or failure to exercise any right
hereunder on the part of Holder shall operate as a waiver of such right or otherwise prejudice the Holder’s rights, powers, or remedies,
notwithstanding the fact that all rights hereunder terminate on the Termination Date. If the Company willfully and knowingly fails to
comply with any provision of this Option, which results in any material damages to the Holder, the Company shall pay to the Holder such
amounts as shall be sufficient to cover any costs and expenses including, but not limited to, reasonable attorneys’ fees, including
those of appellate proceedings, incurred by the Holder in collecting any amounts due pursuant hereto or in otherwise enforcing any of
its rights, powers or remedies hereunder.

 

    	 	13	 

    	 

    

h)                                  
Notices. Any notices, consents, waivers or other communications required or permitted to be
given under the terms of this Option must be in writing and will be deemed to have been delivered upon: (i) receipt, when delivered personally,
(ii) one Trading Day after deposit with an overnight courier service with next day delivery specified, in each case, properly addressed
to the party to receive the same, or (iii) receipt, when sent by electronic mail (provided that the electronic mail transmission is not
returned in error or the sender is not otherwise notified of any error in transmission. The address and email address of the Holder for
such communications appear on the books of the Company and the address and email address of the Company for such communications appear
on its filings with the SEC and on its website. Alternative addresses and e-mail addresses can be provided by written notice given to
each other party three Trading Days prior to the effectiveness of such change. Written confirmation of receipt (i) given by the recipient
of such notice, consent, waiver or other communication, (ii) mechanically or electronically generated by the sender’s computer containing
the time, date, recipient’s electronic mail address and the text of such electronic mail or (iii) provided by a nationally recognized
overnight delivery service, shall be rebuttable evidence of personal service, receipt by electronic mail or receipt from a nationally
recognized overnight delivery service in accordance with clause (i), (ii) or (iii) above, respectively.

 

i)                                       
Limitation of Liability. No provision hereof, in the absence of any affirmative action by
the Holder to exercise this Option to purchase Option Shares, and no enumeration herein of the rights or privileges of the Holder, shall
give rise to any liability of the Holder for the purchase price of any Common Stock or as a stockholder of the Company, whether such liability
is asserted by the Company or by creditors of the Company.

 

j)                                       
Remedies. The Holder, in addition to being entitled to exercise all rights granted by law,
including recovery of damages, will be entitled to specific performance of its rights under this Option. The Company agrees that monetary
damages would not be adequate compensation for any loss incurred by reason of a breach by it of the provisions of this Option and hereby
agrees to waive and not to assert the defense in any action for specific performance that a remedy at law would be adequate.

 

k)                                   
Successors and Assigns. Subject to applicable securities laws, this Option and the rights
and obligations evidenced hereby shall inure to the benefit of and be binding upon the successors and permitted assigns of the Company
and the successors and permitted assigns of Holder. The provisions of this Option are intended to be for the benefit of any Holder from
time to time of this Option and shall be enforceable by the Holder or holder of Option Shares.

 

l)                                       
Amendment. This Option may be modified or amended or the provisions hereof waived with the
written consent of the Company and the Holder.

 

m)                              
Severability. Wherever possible, each provision of this Option shall be interpreted in such
manner as to be effective and valid under applicable law, but if any provision of this Option shall be prohibited by or invalid under
applicable law, such provision shall be ineffective to the extent of such prohibition or invalidity, without invalidating the remainder
of such provisions or the remaining provisions of this Option.

 

n)                                  
Headings. The headings used in this Option are for the convenience of reference only and shall
not, for any purpose, be deemed a part of this Option.

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

 

 

(Signature Page Follows)

 

    	 	14	 

    	 

    

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

 

 

	 	IQSTEL INC.
	 	 	 
	 	 	 
	 	 	 
	 	By:	/s/ Leandro Iglesias
			Leandro Iglesias, Chief Executive Officer

 

    	 	15	 

    	 

    

EXHIBIT A

 

NOTICE OF EXERCISE

 

TO:IQSTEL INC.

 

(1)  
The undersigned hereby elects to purchase Option
Shares of the Company pursuant to the terms of the attached Option (only if exercised in full), and tenders herewith payment of the exercise
price in full, together with all applicable transfer taxes, if any.

 

(2)
 Payment shall take the form of (check
                                                                                                                                                applicable box):

 

[ ] in lawful money of the United States; or

 

[ ] if permitted the cancellation of
such number of Option Shares as is necessary, in accordance with the formula set forth in subsection 2(c), to exercise this Option with
respect to the maximum number of Option Shares purchasable pursuant to the cashless exercise procedure set forth in subsection 2(c).

 

(3)  
Please issue said Option Shares in the name of the undersigned or in such other name as is specified
below:

 

	 	 	 

 

The Option Shares shall be delivered to the following DWAC Account
Number:

 

	 	 	 
	 	 	 
	 	 	 

 

(4)       
Accredited Investor. The undersigned is an “accredited investor” as defined in
Regulation D promulgated under the Securities Act of 1933, as amended.

 

 

Name of Holder: ___________________________________

 

 

 

	Signature of Authorized Signatory of Holder:	 	 
	Name of Authorized Signatory:	 	 
	Title of
Authorized Signatory:	 	 
	Date: ____________	 	 

 

    	 	16	 

    	 

    

EXHIBIT B

 

 

ASSIGNMENT FORM

 

(To assign the foregoing Option, execute this form and supply required
information. Do not use this form to purchase shares.)

FOR VALUE RECEIVED, the foregoing
Option and all rights evidenced thereby are hereby assigned to 

		Name:	 	 	 
	 	 	 	(Please Print)	 
	 	 	 	 	 
	 	Address:	 	 	 
	 	 	 	(Please Print)	 

Dated: _______________ __, _____

 

Holder’s Signature: ____________________

 

Holder’s Address: _____________________

 

    	 	17	 

    	 

    

 

	Option Right	$500,000	 	 	 	 
	Option Shares Base	4,800,000	 	 	 	 
	Option Exercise Price	$2	 	 	 	 
	Option Value	$9,600,000	 	 	 	 
	 	 	 	 	 	 
	Market Price	Bellow $1.5	Between $1.501 and <$2.00	Above $2.01	 	 
	Option Discount	32%	16%	0%	 	 
	 	 	 	 	 	 
	 	 	 	 	 	 
	A = VWAP (Market Value)	% Discount	B = New Exercise Price	Adjusted Option Shares	CashLess Shares	CashLess Value
	$0.200	32%	$0.136	48,000,000	15,360,000	$3,072,000
	$0.300	32%	$0.204	32,000,000	10,240,000	$3,072,000
	$0.400	32%	$0.272	24,000,000	7,680,000	$3,072,000
	$0.500	32%	$0.340	19,200,000	6,144,000	$3,072,000
	$0.600	32%	$0.408	16,000,000	5,120,000	$3,072,000
	$0.700	32%	$0.476	13,714,286	4,388,571	$3,072,000
	$0.800	32%	$0.544	12,000,000	3,840,000	$3,072,000
	$0.900	32%	$0.612	10,666,667	3,413,333	$3,072,000
	$1.000	32%	$0.680	9,600,000	3,072,000	$3,072,000
	$1.100	32%	$0.748	8,727,273	2,792,727	$3,072,000
	$1.200	32%	$0.816	8,000,000	2,560,000	$3,072,000
	$1.300	32%	$0.884	7,384,615	2,363,077	$3,072,000
	$1.400	32%	$0.952	6,857,143	2,194,286	$3,072,000
	$1.500	32%	$1.020	6,400,000	2,048,000	$3,072,000
	$1.600	16%	$1.344	6,000,000	960,000	$1,536,000
	$1.700	16%	$1.428	5,647,059	903,529	$1,536,000
	$1.800	16%	$1.512	5,333,333	853,333	$1,536,000
	$1.900	16%	$1.596	5,052,632	808,421	$1,536,000

 

SCHEDULE A

 

    	 	18

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