Document:

WELLS FARGO & COMPANY 8-K

 

 Exhibit
4.2

 

 

[Face
of Note]

 

Unless
this certificate is presented by an authorized representative of The Depository Trust Company, a New York corporation (“DTC”),
to the Company or its agent for registration of transfer, exchange or payment, and any certificate issued is registered in the
name of Cede & Co. or in such other name as requested by an authorized representative of DTC (and any payment is made to Cede & Co. or such other entity as is requested by an authorized representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF
FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered owner hereof, Cede & Co., has an interest
herein.

	CUSIP
NO. 95001HEB3	FACE AMOUNT: $_________

REGISTERED
NO. ___

 

 

WELLS
FARGO FINANCE LLC

 

MEDIUM-TERM
NOTE, SERIES A

Fully
and Unconditionally Guaranteed by Wells Fargo & Company

 

 

Principal
at Risk Securities Linked to the S&P 500® Index

due
January 28, 2025

 

 

WELLS
FARGO FINANCE LLC, a limited liability company duly organized and existing under the laws of the State of Delaware (hereinafter
called the “Company,” which term includes any successor corporation under and as defined in the Indenture hereinafter
referred to), for value received, hereby promises to pay to CEDE & Co., or registered assigns, an amount equal to the
Maturity Payment Amount (as defined below), in such coin or currency of the United States of America as at the time of payment
is legal tender for payment of public and private debts, on the Stated Maturity Date. The “Initial Stated Maturity Date”
shall be January 28, 2025. If the Calculation Day (as defined below) is not postponed, the Initial Stated Maturity Date will be
the “Stated Maturity Date.” If the Calculation Day is postponed, the “Stated Maturity Date”
shall be the later of (i) the Initial Stated Maturity Date and (ii) three Business Days (as defined below) after the
Calculation Day as postponed. This Security shall not bear any interest.

Any
payments on this Security at Maturity will be made against presentation of this Security at the office or agency of the Company
maintained for that purpose in the City of Minneapolis, Minnesota and at any other office or agency maintained by the Company
for such purpose. 

“Face
Amount” shall mean, when used with respect to this Security, the amount set forth on the face of this Security as its
“Face Amount.”

    	 	 	 

    	 

    

Determination
of Maturity Payment Amount

The
“Maturity Payment Amount” of this Security will equal:

 

		•	if
                                         the Ending Level is greater than the Starting Level: the Face Amount plus:

 

 

		•	if
                                         the Ending Level is less than or equal to the Starting Level, but greater than or equal
                                         to the Threshold Level: the Face Amount; or

 

		•	if
                                         the Ending Level is less than the Threshold Level: the Face Amount minus:

 

 

 

All
calculations with respect to the Maturity Payment Amount will be rounded to the nearest one hundred-thousandth, with five one-millionths
rounded upward (e.g., 0.000005 would be rounded to 0.00001); and the Maturity Payment Amount will be rounded to the nearest cent,
with one-half cent rounded upward.

 

“Index”
shall mean the S&P 500® Index.

 

The
“Pricing Date” shall mean January 23, 2020.

 

The
“Starting Level” is 3321.75, the Closing Level of the Index on January 22, 2020.

 

The
“Closing Level” of the Index on any Trading Day means the official closing level of the Index reported by the
Index Sponsor on such Trading Day, as obtained by the Calculation Agent on such Trading Day from the licensed third-party market
data vendor contracted by the Calculation Agent at such time; in particular, taking into account the decimal precision and/or
rounding convention employed by such licensed third-party market data vendor on such date, subject to the provisions set forth
below under “Adjustments to the Index,” “Discontinuance of the Index” and “Market Disruption Events.”

 

The
“Ending Level” will be the Closing Level of the Index on the Calculation Day.

 

The
“Threshold Level” is 2657.40, which is equal to 80% of the Starting Level.

 

The
“Participation Rate” is 143%.

 

“Index
Sponsor” shall mean S&P Dow Jones Indices LLC.

 

“Business
Day” shall mean a day, other than a Saturday or Sunday, that is neither a legal holiday nor a day on which banking institutions
are authorized or required by law or regulation to close in New York, New York.

 

    	 	2	 

    	 

    

 

A
“Trading Day” means a day, as determined by the Calculation Agent, on which (i) the Relevant Stock Exchanges
with respect to each security underlying the Index are scheduled to be open for trading for their respective regular trading sessions
and (ii) each Related Futures or Options Exchange is scheduled to be open for trading for its regular trading session.

 

The
“Related Futures or Options Exchange” for the Index means an exchange or quotation system where trading has
a material effect (as determined by the Calculation Agent) on the overall market for futures or options contracts relating to
the Index.

 

The
“Relevant Stock Exchange” for any security underlying the Index means the primary exchange or quotation system
on which such security is traded, as determined by the Calculation Agent.

 

The
“Calculation Day” shall be January 23, 2025. If such day is not a Trading Day, the Calculation Day will be
postponed to the next succeeding Trading Day. The Calculation Day is also subject to postponement due to the occurrence of a Market
Disruption Event (as defined below). If a Market Disruption Event occurs or is continuing with respect to the Index on the Calculation
Day, such Calculation Day will be postponed to the first succeeding Trading Day on which a Market Disruption Event has not occurred
and is not continuing; however, if such first succeeding Trading Day has not occurred as of the eighth Trading Day after the originally
scheduled Calculation Day, that eighth Trading Day shall be deemed to be the Calculation Day. If the Calculation Day has been
postponed eight Trading Days after the originally scheduled Calculation Day and a Market Disruption Event occurs or is continuing
on such eighth Trading Day, the Calculation Agent will determine the Closing Level of the Index on such eighth Trading Day in
accordance with the formula for and method of calculating the Closing Level of the Index last in effect prior to commencement
of the Market Disruption Event, using the closing price (or, with respect to any relevant security, if a Market Disruption Event
has occurred with respect to such security, its good faith estimate of the value of such security at the Scheduled Closing Time
of the Relevant Stock Exchange for such security or, if earlier, the actual closing time of the regular trading session of such
Relevant Stock Exchange) on such date of each security included in the Index. As used herein, “closing price”
means, with respect to any security on any date, the Relevant Stock Exchange traded or quoted price of such security as of the
Scheduled Closing Time of the Relevant Stock Exchange for such security or, if earlier, the actual closing time of the regular
trading session of such Relevant Stock Exchange.

 

“Calculation
Agent Agreement” shall mean the Calculation Agent Agreement dated as of May 18, 2018 between the Company and the
Calculation Agent, as amended from time to time.

 

“Calculation
Agent” shall mean the Person that has entered into the Calculation Agent Agreement with the Company providing for, among
other things, the determination of the Ending Level and the Maturity Payment Amount, which term shall, unless the context otherwise
requires, include its successors under such Calculation Agent Agreement. The initial Calculation Agent shall be Wells Fargo Securities,
LLC. Pursuant to the Calculation Agent Agreement, the Company may appoint a different Calculation Agent from time to time after
the initial issuance

 

    	 	3	 

    	 

    

of
this Security without the consent of the Holder of this Security and without notifying the Holder of this Security.

 

Adjustments
to the Index

 

If
at any time the method of calculating the Index or a Successor Equity Index, or the closing level thereof, is changed in a material
respect, or if the Index or a Successor Equity Index is in any other way modified so that such index does not, in the opinion
of the Calculation Agent, fairly represent the level of such index had those changes or modifications not been made, then the
Calculation Agent will, at the close of business in New York, New York, on each date that the closing level of such index is to
be calculated, make such calculations and adjustments as, in the good faith judgment of the Calculation Agent, may be necessary
in order to arrive at a level of an index comparable to the Index or Successor Equity Index as if those changes or modifications
had not been made, and the Calculation Agent will calculate the closing level of the Index or Successor Equity Index with reference
to such index, as so adjusted. Accordingly, if the method of calculating the Index or Successor Equity Index is modified so that
the level of such index is a fraction or a multiple of what it would have been if it had not been modified (e.g., due to
a split or reverse split in such equity index), then the Calculation Agent will adjust the Index or Successor Equity Index in
order to arrive at a level of such index as if it had not been modified (e.g., as if the split or reverse split had not
occurred).

 

Discontinuance
of the Index

If
the Index Sponsor discontinues publication of the Index, and the Index Sponsor or another entity publishes a successor or substitute
equity index that the Calculation Agent determines, in its sole discretion, to be comparable to the Index (a “Successor
Equity Index”), then, upon the Calculation Agent’s notification of that determination to the Trustee and the Company,
the Calculation Agent will substitute the Successor Equity Index as calculated by the Index Sponsor or any other entity and calculate
the Ending Level as described above. Upon any selection by the Calculation Agent of a Successor Equity Index, the Company will
cause notice to be given to the Holder of this Security.

In
the event that the Index Sponsor discontinues publication of the Index prior to, and the discontinuance is continuing on, the
Calculation Day and the Calculation Agent determines that no Successor Equity Index is available at such time, the Calculation
Agent will calculate a substitute Closing Level for the Index in accordance with the formula for and method of calculating the
Index last in effect prior to the discontinuance, but using only those securities that comprised the Index immediately prior to
that discontinuance. If a Successor Equity Index is selected or the Calculation Agent calculates a level as a substitute for the
Index, the Successor Equity Index or level will be used as a substitute for the Index for all purposes, including the purpose
of determining whether a Market Disruption Event exists.

If
on the Calculation Day the Index Sponsor fails to calculate and announce the level of the Index, the Calculation Agent will calculate
a substitute Closing Level of the Index in accordance with the formula for and method of calculating the Index last in effect
prior to the failure, but using only those securities that comprised the Index immediately prior to that failure; provided
that, if a Market Disruption Event occurs or is continuing on such day, then the

    	 	4	 

    	 

    

provisions
set forth above under the definition of “Calculation Day” shall apply in lieu of the foregoing.

Market
Disruption Events 

A
“Market Disruption Event” means any of the following events as determined by the Calculation Agent in its sole
discretion:

 

		(A)	The
                                         occurrence or existence of a material suspension of or limitation imposed on trading
                                         by the Relevant Stock Exchanges or otherwise relating to securities which then comprise
                                         20% or more of the level of the Index or any Successor Equity Index at any time during
                                         the one-hour period that ends at the Close of Trading on that day, whether by reason
                                         of movements in price exceeding limits permitted by those Relevant Stock Exchanges or
                                         otherwise.

		(B)	The
                                         occurrence or existence of a material suspension of or limitation imposed on trading
                                         by any Related Futures or Options Exchange or otherwise in futures or options contracts
                                         relating to the Index or any Successor Equity Index on any Related Futures or Options
                                         Exchange at any time during the one-hour period that ends at the Close of Trading on
                                         that day, whether by reason of movements in price exceeding limits permitted by the Related
                                         Futures or Options Exchange or otherwise.

		(C)	The
                                         occurrence or existence of any event, other than an early closure, that materially disrupts
                                         or impairs the ability of market participants in general to effect transactions in, or
                                         obtain market values for, securities that then comprise 20% or more of the level of the
                                         Index or any Successor Equity Index on their Relevant Stock Exchanges at any time during
                                         the one-hour period that ends at the Close of Trading on that day.

		(D)	The
                                         occurrence or existence of any event, other than an early closure, that materially disrupts
                                         or impairs the ability of market participants in general to effect transactions in, or
                                         obtain market values for, futures or options contracts relating to the Index or any Successor
                                         Equity Index on any Related Futures or Options Exchange at any time during the one-hour
                                         period that ends at the Close of Trading on that day.

		(E)	The
                                         closure on any Exchange Business Day of the Relevant Stock Exchanges on which securities
                                         that then comprise 20% or more of the level of the Index or any Successor Equity Index
                                         are traded or any Related Futures or Options Exchange prior to its Scheduled Closing
                                         Time unless the earlier closing time is announced by the Relevant Stock Exchange or Related
                                         Futures or Options Exchange, as applicable, at least one hour prior to the earlier of
                                         (1) the actual closing time for the regular trading session on such Relevant Stock
                                         Exchange or Related Futures or Options Exchange, as applicable, and (2) the submission
                                         deadline for orders to be entered into the Relevant Stock Exchange or Related Futures
                                         or Options

    	 	5	 

    	 

    

Exchange,
as applicable, system for execution at such actual closing time on that day.

		(F)	The
                                         Relevant Stock Exchange for any security underlying the Index or Successor Equity Index
                                         or any Related Futures or Options Exchange fails to open for trading during its regular
                                         trading session.

For
purposes of determining whether a Market Disruption Event has occurred:

		(1)	the
                                         relevant percentage contribution of a security to the level of the Index or any Successor
                                         Equity Index will be based on a comparison of (x) the portion of the level of such
                                         Index attributable to that security and (y) the overall level of the Index or Successor
                                         Equity Index, in each case immediately before the occurrence of the Market Disruption
                                         Event;

		(2)	the
                                         “Close of Trading” on any Trading Day for the Index or any Successor
                                         Equity Index means the Scheduled Closing Time of the Relevant Stock Exchanges with respect
                                         to the securities underlying the Index or Successor Equity Index on such Trading Day;
                                         provided that, if the actual closing time of the regular trading session of any
                                         such Relevant Stock Exchange is earlier than its Scheduled Closing Time on such Trading
                                         Day, then (x) for purposes of clauses (A) and (C) of the definition of “Market
                                         Disruption Event” above, with respect to any security underlying the Index or Successor
                                         Equity Index for which such Relevant Stock Exchange is its Relevant Stock Exchange, the
                                         “Close of Trading” means such actual closing time and (y) for purposes of
                                         clauses (B) and (D) of the definition of “Market Disruption Event” above,
                                         with respect to any futures or options contract relating to the Index or Successor Equity
                                         Index, the “close of trading” means the latest actual closing time of the
                                         regular trading session of any of the Relevant Stock Exchanges, but in no event later
                                         than the Scheduled Closing Time of the Relevant Stock Exchanges;

		(3)	the
                                         “Scheduled Closing Time” of any Relevant Stock Exchange or Related
                                         Futures or Options Exchange on any Trading Day for the Index or any Successor Equity
                                         Index means the scheduled weekday closing time of such Relevant Stock Exchange or Related
                                         Futures or Options Exchange on such Trading Day, without regard to after hours or any
                                         other trading outside the regular trading session hours; and

		(4)	an
                                         “Exchange Business Day” means any Trading Day for the Index or any
                                         Successor Equity Index on which each Relevant Stock Exchange for the securities underlying
                                         the Index or any Successor Equity Index and each Related Futures or Options Exchange
                                         are open for trading during their respective regular trading sessions, notwithstanding
                                         any such Relevant Stock Exchange or Related Futures or Options Exchange closing prior
                                         to its Scheduled Closing Time.

    	 	6	 

    	 

    

Calculation
Agent

The
Calculation Agent will determine the Maturity Payment Amount and the Ending Level. In addition, the Calculation Agent will (i)
determine if adjustments are required to the Closing Level of the Index under the circumstances described in this Security, (ii)
if publication of the Index is discontinued, select a Successor Equity Index or, if no Successor Equity Index is available, determine
the Closing Level of the Index under the circumstances described in this Security, and (iii) determine whether a Market Disruption
Event or non-Trading Day has occurred.

The
Company covenants that, so long as this Security is Outstanding, there shall at all times be a Calculation Agent (which shall
be a broker-dealer, bank or other financial institution) with respect to this Security.

All
determinations made by the Calculation Agent with respect to this Security will be at the sole discretion of the Calculation Agent
and, in the absence of manifest error, will be conclusive for all purposes and binding on the Company and the Holder of this Security.

Tax
Considerations

The
Company agrees, and by acceptance of a beneficial ownership interest in this Security each Holder of this Security will be deemed
to have agreed (in the absence of a statutory, regulatory, administrative or judicial ruling to the contrary), for United States
federal income tax purposes to characterize and treat this Security as a prepaid derivative contract that is an “open transaction.”

Redemption
and Repayment

This
Security is not subject to redemption at the option of the Company or repayment at the option of the Holder hereof prior to January
28, 2025. This Security is not entitled to any sinking fund.

Acceleration

If
an Event of Default, as defined in the Indenture, with respect to this Security shall occur and be continuing, the Maturity Payment
Amount (calculated as set forth in the next sentence) of this Security may be declared due and payable in the manner and with
the effect provided in the Indenture. The amount payable to the Holder hereof upon any acceleration permitted under the Indenture
will be equal to the Maturity Payment Amount hereof calculated as provided herein as though the date of acceleration was the Calculation
Day.

__________________

Reference
is hereby made to the further provisions of this Security set forth on the reverse hereof, which further provisions shall for
all purposes have the same effect as if set forth at this place.

Unless
the certificate of authentication hereon has been executed by the Trustee referred to on the reverse hereof by manual signature
or its duly authorized agent under the Indenture referred

    	 	7	 

    	 

    

to
on the reverse hereof by manual signature, this Security shall not be entitled to any benefit under the Indenture or be valid
or obligatory for any purpose.

 

[The
remainder of this page has been left intentionally blank]

    	 	8	 

    	 

    

 

IN WITNESS WHEREOF, the Company has caused this instrument to be duly executed.

 

DATED: 

 

	
 

	
WELLS FARGO FINANCE LLC

	
 

	
 

	
 

	
 

	
 

	
By:

	
 

	
 

	 	 	 	 
	
 

	
 

	
Its:

	
 

	
 

	
 

	
 

	
 

	
 

	
Attest: 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
Its:

	
 

 

TRUSTEE’S
CERTIFICATE OF

AUTHENTICATION

This is one of
the Securities of the

series designated
therein described

in the within-mentioned Indenture.

 

	
CITIBANK, N.A.,

	
 

	
 

	
as Trustee

	
 

	
 

	
 

	
 

	
By:

	
 

	
 

	
 

	
Authorized Signature

	
 

	
 

	
 

	
 

	
 

	
OR

	
 

	
 

	
 

	
 

	
 

	
WELLS FARGO BANK, N.A.,

	
 

	
 

	
as Authenticating Agent for the Trustee

	
 

	
 

	
 

	
 

	
By:

	
 

	
 

	
 

	
Authorized Signature

	
 

	
 

	
 

	
 

	
 

 

    	 	9	 

    	 

    

[Reverse
of Note]

 

 

WELLS
FARGO FINANCE LLC

 

MEDIUM-TERM
NOTE, SERIES A

Fully
and Unconditionally Guaranteed by Wells Fargo & Company

 

Principal
at Risk Securities Linked to the S&P 500® Index

due January 28, 2025

 

This
Security is one of a duly authorized issue of securities of the Company (herein called the “Securities”), issued
and to be issued in one or more series under an indenture dated as of April 25, 2018, as amended or supplemented from time
to time (herein called the “Indenture”), among the Company, as issuer, Wells Fargo & Company, as guarantor
(the “Guarantor”) and Citibank, N.A., as trustee (herein called the “Trustee,” which term
includes any successor trustee under the Indenture), to which Indenture and all indentures supplemental thereto reference is hereby
made for a statement of the respective rights, limitations of rights, duties and immunities thereunder of the Company, the Guarantor,
the Trustee and the Holders of the Securities, and of the terms upon which the Securities are, and are to be, authenticated and
delivered. This Security is one of the series of the Securities designated as Medium-Term Notes, Series A, of the Company.
The amount payable on the Securities of this series may be determined by reference to the performance of one or more equity-,
commodity- or currency-based indices, exchange traded funds, securities, commodities, currencies, statistical measures of economic
or financial performance, or a basket comprised of two or more of the foregoing, or any other market measure or may bear interest
at a fixed rate or a floating rate. The Securities of this series may mature at different times, be redeemable at different times
or not at all, be repayable at the option of the Holder at different times or not at all and be denominated in different currencies.

The
Securities are issuable only in registered form without coupons and will be either (a) book-entry securities represented
by one or more Global Securities recorded in the book-entry system maintained by the Depositary or (b) certificated securities
issued to and registered in the names of, the beneficial owners or their nominees.

The
Company agrees, to the extent permitted by law, not to voluntarily claim the benefits of any laws concerning usurious rates of
interest against a Holder of this Security.

Guarantee

The
Securities of this series are fully and unconditionally guaranteed by the Guarantor as and to the extent set forth in the Indenture.

Modification
and Waivers 

The
Indenture permits, with certain exceptions as therein provided, the amendment thereof and the modification of the rights and obligations
of the Company and the Guarantor and the rights of the Holders of the Securities of each series to be affected under the Indenture
at any time by the

    	 	10	 

    	 

    

Company,
the Guarantor and the Trustee with the consent of the Holders of a majority in principal amount of the Securities at the time
Outstanding of all series to be affected, acting together as a class. The Indenture also contains provisions permitting the Holders
of a majority in principal amount of the Securities of all series at the time Outstanding affected by certain provisions of the
Indenture, acting together as a class, on behalf of the Holders of all Securities of such series, to waive compliance by the Company
or the Guarantor with those provisions of the Indenture. Certain past defaults under the Indenture and their consequences may
be waived under the Indenture by the Holders of a majority in principal amount of the Securities of each series at the time Outstanding,
on behalf of the Holders of all Securities of such series. Solely for the purpose of determining whether any consent, waiver,
notice or other action or Act to be taken or given by the Holders of Securities pursuant to the Indenture has been given or taken
by the Holders of Outstanding Securities in the requisite aggregate principal amount, the principal amount of this Security will
be deemed to be equal to the amount set forth on the face hereof as the “Face Amount” hereof. Any such consent or
waiver by the Holder of this Security shall be conclusive and binding upon such Holder and upon all future Holders of this Security
and of any Security issued upon the registration of transfer hereof or in exchange herefor or in lieu hereof, whether or not notation
of such consent or waiver is made upon this Security.

Defeasance

Section 403
and Article Fifteen of the Indenture and the provisions of clause (ii) of Section 401(1)(B) of the Indenture, relating
to defeasance at any time of (a) the entire indebtedness on this Security and (b) certain restrictive covenants, upon
compliance by the Company or the Guarantor with certain conditions set forth therein, shall not apply to this Security. The remaining
provisions of Section 401 of the Indenture shall apply to this Security.

Authorized
Denominations

This
Security is issuable only in registered form without coupons in denominations of $1,000 or any amount in excess thereof which
is an integral multiple of $1,000.

Registration
of Transfer

Upon
due presentment for registration of transfer of this Security at the office or agency of the Company in the City of Minneapolis,
Minnesota, a new Security or Securities of this series, with the same terms as this Security, in authorized denominations for
an equal aggregate Face Amount will be issued to the transferee in exchange herefor, as provided in the Indenture and subject
to the limitations provided therein and to the limitations described below, without charge except for any tax or other governmental
charge imposed in connection therewith.

This
Security is exchangeable for definitive Securities in registered form only if (x) the Depositary notifies the Company that
it is unwilling or unable to continue as Depositary for this Security or if at any time the Depositary ceases to be a clearing
agency registered under the Securities Exchange Act of 1934, as amended, and a successor depositary is not appointed within 90 days
after the Company receives such notice or becomes aware of such ineligibility, (y) the Company in its sole discretion determines
that this Security shall be exchangeable for definitive Securities in registered form and notifies the Trustee thereof or (z)
an Event of Default with respect

    	 	11	 

    	 

    

to
the Securities represented hereby has occurred and is continuing. If this Security is exchangeable pursuant to the preceding sentence,
it shall be exchangeable for definitive Securities in registered form, having the same date of issuance, Stated Maturity Date
and other terms and of authorized denominations aggregating a like amount.

This
Security may not be transferred except as a whole by the Depositary to a nominee of the Depositary or by a nominee of the Depositary
to the Depositary or another nominee of the Depositary or by the Depositary or any such nominee to a successor of the Depositary
or a nominee of such successor. Except as provided above, owners of beneficial interests in this Global Security will not be entitled
to receive physical delivery of Securities in definitive form and will not be considered the Holders hereof for any purpose under
the Indenture.

Prior
to due presentment of this Security for registration of transfer, the Company, the Guarantor, the Trustee and any agent of the
Company, the Guarantor or the Trustee may treat the Person in whose name this Security is registered as the owner hereof for all
purposes, whether or not this Security be overdue, and neither the Company, the Guarantor, the Trustee nor any such agent shall
be affected by notice to the contrary.

Obligation
of the Company Absolute

No
reference herein to the Indenture and no provision of this Security or the Indenture shall alter or impair the obligation of the
Company, which is absolute and unconditional, to pay the Maturity Payment Amount at the times, place and rate, and in the coin
or currency, herein prescribed, except as otherwise provided in this Security.

No
Personal Recourse

No
recourse shall be had for the payment of the Maturity Payment Amount, or for any claim based hereon, or otherwise in respect hereof,
or based on or in respect of the Indenture or any indenture supplemental thereto, against any incorporator, stockholder, officer
or director, as such, past, present or future, of the Company or any successor corporation or of the Guarantor or any successor
corporation, whether by virtue of any constitution, statute or rule of law, or by the enforcement of any assessment or penalty
or otherwise, all such liability being, by the acceptance hereof and as part of the consideration for the issuance hereof, expressly
waived and released.

Defined
Terms

All
terms used in this Security which are defined in the Indenture shall have the meanings assigned to them in the Indenture unless
otherwise defined in this Security.

Governing
Law

This
Security shall be governed by and construed in accordance with the law of the State of New York, without regard to principles
of conflicts of laws.

    	 	12	 

    	 

    

 

ABBREVIATIONS

 

The following abbreviations, when used in the inscription on the face of this instrument, shall be construed as though they were written out in full according to applicable laws or regulations:

 

	
TEN COM

	
--

	
as tenants in common

	
 

	
 

	
 

	
 

	
 

	
TEN ENT

	
--

	
as tenants by the entireties

	
 

	
 

	
 

	
 

	
 

	
JT TEN

	
--

	
as joint tenants with right

	
 

	
 

	
 

	
of survivorship and not

	
 

	
 

	
 

	
as tenants in common

	
 

 

	
UNIF GIFT MIN ACT

	
--

	
 

	
Custodian

	
 

	
 

	
 

	
(Cust)

	
 

	
(Minor)

 

	
Under Uniform Gifts to Minors Act

	
 

	
 

	
 

	
 

	
 

	
(State)

	
 

 

Additional abbreviations may also be used though not in the above list.

 

FOR VALUE RECEIVED, the undersigned hereby sell(s) and transfer(s) unto

 

	
Please Insert Social Security or

	
 

	
Other Identifying Number of Assignee

	
 

	
 

	
 

	
 

	
 

 

	
 

	
 

	
 

	
(Please print or type name and address including postal zip code of Assignee)

 

    	 	13	 

    	 

    

the
within Security of WELLS FARGO FINANCE LLC and does hereby irrevocably constitute and appoint __________________ attorney to transfer
the said Security on the books of the Company, with full power of substitution in the premises.

 

 

	
Dated: _________________________

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

 

 

NOTICE:
The signature to this assignment must correspond with the name as written upon the face of the within instrument in every particular,
without alteration or enlargement or any change whatever.

 

 

    	 	14Exhibit 10.1

 

SETTLEMENT AGREEMENT AND MUTUAL RELEASE

 

This Settlement Agreement and Mutual Release
(“AGREEMENT”) is entered into as of January 24, 2020 by and among Hudson Bay Master Fund Ltd., a company formed
under the laws of the Cayman Islands, (“HUDSON BAY”); Alto Opportunity Master Fund, SPC – Segregated Master Portfolio
B, a company formed under the laws of the Cayman Islands (“ALTO”), and Nanoviricides, Inc., a company incorporated
under the laws of Nevada (“NANOVIRICIDES” or the "COMPANY"). In this AGREEMENT, HUDSON BAY AND ALTO are collectively
referred to as the "PURCHASERS," and HUDSON BAY, ALTO and NANOVIRICIDES are collectively referred to as the “PARTIES”
and individually as a “PARTY.”

 

RECITALS

 

A.            On
February 27, 2019, the Parties entered into a Securities Purchase Agreement (the “SPA”) and Common Stock Purchase
Warrant (the "Warrant") pursuant to which PURCHASERS provided $2.5 million in financing in a registered direct offering
in exchange for 6,944,446 units, each comprised of one share of common stock (priced at $0.36 per share) and one five-year Warrant
(exercisable at $0.61 per share). In connection with the deal, Purchasers bargained for the right to participate in any subsequent
financings offered by the Company, and the Company agreed not to issue new common shares at a price below the exercise price of
Purchasers’ Warrants for one year.

 

B.            The
COMPANY subsequently executed a 20-for-1 reverse stock split. Section 3(a) of the Warrants required that the exercise
price of the Warrants be adjusted to $12.20. Accordingly, pursuant to Section 4.12 of the SPA, thereafter the Company was
prohibited from issuing Common Stock below $12.20 per share.

 

C.             On
January 9, 2020, the COMPANY provided a Subsequent Financing Notice pursuant to Section 4.11(b) of the SPA. In response,
HUDSON BAY sought detail about the pricing of the COMPANY's contemplated offering. The COMPANY did not respond to HUDSON BAY'S
request.

 

D.            On
January 21, 2020, the COMPANY announced an offering of 2.5 million shares of the Company's common stock at a price of $3.00
per share, as well as the grant to the underwriters of an option to purchase up to 375,000 additional shares of common stock to
cover over-allotments at the public offering price. The COMPANY did not provide a second Subsequent Financing Notice as provided
for in Section 4.11(f) of the SPA.

 

E.            Section 4.11
of the SPA provides Purchasers “the right to participate in up to an amount of the Subsequent Financing equal to 50% of the
Subsequent Financing...on the same terms, conditions and price provided for in the Subsequent Financing.” Section 4.12
of the SPA prohibits the Company from issuing Common Stock “ at an effective price below the then Exercise Price of the Warrant.”

 

F.            The
Subsequent Financing announced by the Company is priced at $3, below the exercise price of Purchasers’ Warrants, in breach
of Section 4.12.

 

    

     

    

 

G.            PURCHASERS
filed a Complaint against the COMPANY on January 23, 2020 in the Supreme Court in the State of New York, County of New York
(the “Court”) alleging violations of the SPA; the action is captioned Hudson Bay Master Fund Ltd. et al v. Nanoviricides, Inc., Index
No.650515/2020 (the “Action”).

 

H             PURCHASERS
moved for an order to show cause as to why an order should not be made and entered preliminarily enjoining and restraining the
COMPANY. from (i) at any time prior to March 1, 2020, consummating any common stock offering without first providing
Purchasers with a Second Subsequent Financing Notice with the requisite pricing and other information and fulfilling any elections
responsive thereto from the Purchasers pursuant to the Securities Purchase Agreement, and (ii) for so long as any Warrants
remain outstanding, consummating any common stock offering at a price below the $12.20 per share exercise price of Purchasers’
Warrants pursuant to the Securities Purchase Agreement without Purchasers’ express written consent.;

 

I.              Following
a hearing on the Order to Show Cause, the Court stated that ti would enter a temporary restraining order ("TRO") enjoining
the Transaction on the posting of a bond by PURCHASERS. In connection therewith, to prevent the immediate entry of the TRO, the
COMPANY agreed to adjourn their closing until 2:00 p.m. to permit the PARTIES to consensually resolve their dispute before
the Court entered a TRO..

 

J.             The
PARTIES now desire to document that settlement and fully and finally settle and terminate all differences, disputes, and disagreements
between them, without further dispute or litigation, in accordance with the terms and conditions set forth in this AGREEMENT.

 

NOW, THEREFORE, for and in consideration
of the mutual promises, covenants and understandings contained herein, and for other good and valuable consideration, the receipt
and adequacy of which is hereby acknowledged, and intending to be legally bound, the PARTIES agree as follows:

 

 1.             Terms and Dismissal of the Action

 

1.1          Term
Sheet

 

1.1.1        The
PARTIES have agreed the Binding Term Sheet, attached hereto as Exhibit I, which is fully incorporated by reference.

 

1.2           Settlement
Payment.

 

1.2.1        COMPANY
has agreed to bay HUDSON BAY'S attorneys' fees and expenses, expected to be about $150,000 and Alto's attorneys' fees and expenses,
expected to be about $6,000. COMPANY has also agreed to pay PURCHASERS any other amounts due pursuant to the Binding Term Sheet
(the “Settlement Payment”) within five business days after execution of this AGREEMENT by all PARTIES, provided
that, so long as this AGREEMENT is finalized and signed by all PARTIES.

 

1.2.2        The
Settlement Payment will be made via wire transfer. The wire transfer information is as follows:

 

    - 2 -

     

    

 

For Hudson Bay:

  

 

For Alto:

 

 

		1.3	Dismissal of the Action

 

1.3.1       Within
two business days after full compliance with the Binding Term Sheet, counsel of record in the Action for PURCHASERS will e-file
with the Court a Stipulation of Dismissal.

 

		2.	Mutual General Release and Covenants Not to Sue

 

		2.1	Definitions.

 

2.1.1       “CLAIMS”
means any and all accounts, actions, causes of action, claims, compensation, contracts, costs, damages, debts, delay damages, demands,
expenses, fees, indebtedness, judgments, liabilities, liens, losses, obligations, rights of contribution, rights of indemnity and
suits of every nature whatsoever, in law, admiralty or equity, whether known, unknown, fixed or contingent, that the releasing
parties ever had, now have or hereafter may acquire against the released parties, for, upon, or by reason of any act, omission,
matter, cause or thing whatsoever, from the beginning of the world to the date of this AGREEMENT, arising out of, based on or relating
in any way to the claims asserted in the Action, including but not limited to the prosecution or defense of the Action, provided,
however, “CLAIMS” does not include CLAIMS to enforce this AGREEMENT.

 

2.1.2       "PURCHASERS
GROUP" means HUDSON BAY, ALTO and each of their respective parents, subsidiaries, affiliates, members and parents of members,
predecessors, successors, assigns and beneficiaries, and their current and former officers, directors, employees, representatives,
agents, independent contractors, attorneys, equity holders, interest holders and all persons acting by, through or in concert with
them

 

    - 3 -

     

    

 

2.1.3        COMPANY
GROUP” means NANOVIRICIDES and its parents, subsidiaries, affiliates, members and parents of members, predecessors, successors,
assigns and beneficiaries, and their current and former officers, directors, employees, representatives, agents, independent contractors,
attorneys, equity holders, interest holders and all persons acting by, through or in concert with them.

 

2.2           Release
of COMPANY GROUP by PURCHASERS GROUP.

 

2.2.1        PURCHASERS,
on behalf of themselves and, to the fullest extent permitted by law, the PURCHASERS GROUP, hereby releases, acquits, and forever
discharges the COMPANY GROUP from any and all CLAIMS the PURCHASERS GROUP ever had, now have or hereafter may acquire against the
COMPANY GROUP, or any of them.

 

2.3           Covenant
Not to Sue.

 

2.3.1        PURCHASERS
covenants not to assert, directly or indirectly, against the COMPANY GROUP any CLAIMS.

 

2.3.2        PURCHASER
may seek a temporary restraining order or preliminary or permanent injunction against any violation of this Section 2.3. The
PARTIES agree that monetary damages would be inadequate to remedy any violation of this Section 2.3.

 

2.4           Release
of PURCHASERS GROUP by COMPANY GROUP.

 

2.4.1        COMPANY,
on behalf of themselves and, to the fullest extent permitted by law, the COMPANY GROUP, hereby releases, acquits and forever discharges
the PURCHASERS GROUP from any and all CLAIMS the COMPANY GROUP ever had, now have or hereafter may acquire against the PURCHASERS
GROUP, or any of them.

 

2.5           Covenant
Not to Sue.

 

2.5.1        COMPANY
covenants not to assert, directly or indirectly, against the PURCHASERS GROUP any CLAIMS.

 

2.5.2         PURCHASERS
and PURCHASERS GROUP may seek a temporary restraining order or preliminary or permanent injunction against any violation of this
Section 2.5. The PARTIES agree that monetary damages would be inadequate to remedy any violation of this Section 2.5.

 

 2.6           MISTAKE/RELEASE OF UNKNOWN CLAIMS.

 

2.6.1        In
entering into this Agreement, each PARTY assumes the risk of any mistake of fact or law. If the PARTIES, or any of them, should
later discover that any fact they relied upon in entering this AGREEMENT is not true, or that their understanding of the facts
or law was incorrect, the PARTIES shall not be entitled to seek rescission of this AGREEMENT or revival of any CLAIMS by reason
of such discovery. This AGREEMENT is intended to be final and binding upon each PARTY regardless of any mistake of fact or law.

 

    -
                                                                                      4 -

     

    

 

2.6.2         Each
PARTY expressly waives the benefits of any statutory provision or common law rule that provides, in sum or substance, that
a release does not extend to claims that the party does not know or suspect to exist
in its favor at the time of executing the release, which if known by it, would have materially affected its settlement. In particular
but without limitation, each Party expressly waives the provisions of California
Civil Code section 1542, as well as any other similar state or federal law, which statute reads:

 

1542. A general release does not
extend to claims that the creditor or releasing party does not know or suspect to exist in his or her favor at the time of executing
the release and that, if known by him or her, would have materially affected his or her settlement with the debtor or released
party

 

3.             Other
Provisions

 

3.1           No
Admission of Liability

 

This AGREEMENT and its provisions shall
not be deemed an admission as to the existence or extent of liability concerning any CLAIMS. Any such liability is expressly denied.

 

3.3           Binding
Effect

 

This AGREEMENT shall be binding upon and
shall inure to the benefit of the PARTIES, their legal representatives, successors, assigns, directors, officers, insureds, shareholders,
members, partners, agents, and employees.

 

3.4           Governing
Law

 

This AGREEMENT shall be construed in accordance
with and governed by the laws of the State of New York without regard to conflict of law principles that might otherwise cause
the law of a different jurisdiction to apply.

 

3.5           Jurisdiction

 

All disputes arising out of or relating
to this AGREEMENT shall be exclusively resolved in the state and federal courts sitting in the City of New York, Borough of Manhattan.
Each party hereby irrevocably submits to the exclusive jurisdiction of the state and federal courts sitting in the City of New
York, Borough of Manhattan for the adjudication of any dispute hereunder or in connection with this AGREEMENT and agrees not to
assert in any action or proceeding, any claim that it is not personally subject to the jurisdiction of any such court, that any
such action or proceeding is improper or is an inconvenient venue for such proceeding. Each party hereby irrevocably waives personal
service of process and consents to service of process being served in any such action or proceeding by mailing a copy thereof via
registered or certified mail or overnight delivery (with evidence of deliver) or by email to such party at the address of their
counsel below.

 

    - 5 -

     

    

 

3.6           Prevailing Party

 

If any party shall commence an action or
proceeding to enforce the provisions of this Agreement, then the prevailing party in such action or proceeding shall be reimbursed
by the non-prevailing party for its reasonable attorney's fees and other costs and expenses incurred in connection with the investigation,
preparation and prosecution or defense of such action or proceeding.

 

3.7           No
Reliance on Parol Evidence or Other Representations

 

Except as expressly stated in this AGREEMENT,
no PARTY has made any statement or representation to any other PARTY regarding any fact, which statement or representation is relied
upon by any other PARTY in entering into this AGREEMENT. The PARTIES and their counsel have made such investigation of the facts
pertaining to the settlement contained herein as they deem necessary.

 

3.8           Integration
Clause

 

This AGREEMENT (and Exhibits 1) constitute
a single, integrated written contract expressing the entire agreement of the PARTIES hereto relative to the subject matter hereof.
No covenant, agreement, representation or warranty of any kind whatsoever has been made by any PARTY hereto, except as specifically
set forth in this AGREEMENT. All prior discussions and negotiations whether written or oral have been and are merged and integrated
into, and are superseded by, this AGREEMENT.

 

3.9           No
Oral Amendments

 

This AGREEMENT may be altered or amended
only by a writing signed by all of the PARTIES.

 

3.10        Counterparts

 

This AGREEMENT may be executed in several
counterparts, each of which shall be deemed an original and all of which when taken together shall constitute the whole of the
AGREEMENT as between the PARTIES. Signatures transmitted by e-mail shall be deemed original signatures for purposes of this AGREEMENT.
True and correct copies of the fully executed AGREEMENT will be effective to enforce the terms and provisions set forth herein
against any of the PARTIES.

 

3.11         Attorneys’
Fees, Costs and Expenses

 

Each PARTY agrees that it shall bear its
own attorneys’ fees, costs and expenses incurred in connection with the DISPUTE and this AGREEMENT, except as set forth above
and the Binding Term Sheet, Exhibit 1 hereto.

 

    - 6
                                                                                      -

     

    

 

3.12         Representation
by Counsel

  

Each PARTY acknowledges and agrees that
it has been represented by counsel of its choice and has had a reasonable opportunity to discuss this AGREEMENT with its counsel.

 

3.12         Severability

 

If any provision of this AGREEMENT or the
application therein is held invalid, the invalidity shall not affect other provisions or applications of this AGREEMENT that can
be given effect without the invalid provisions or applications; and to this end the provisions of this AGREEMENT are declared and
understood to be severable.

 

3.13         Drafting
 – No Presumptions

 

The language of this AGREEMENT shall be
construed as a whole, according to its fair meaning and intendment, and not strictly for or against any PARTY, regardless of who
drafted or was principally responsible for drafting the AGREEMENT or any specific term or condition hereof. This AGREEMENT shall
be deemed to have been drafted by all PARTIES, and no PARTY shall urge otherwise.

 

3.14         Authority
to Execute this AGREEMENT

 

Each PARTY further represents and warrants
that it has the authority and capacity to execute this AGREEMENT, does so knowingly and voluntarily, and does so in the absence
of any mistake, duress or coercion.

 

IN WITNESS WHEREOF, the PARTIES hereto have
executed this AGREEMENT as of January 24, 2020, as follows.

 

 

	Dated: January__, 2020.	 	HUDSON BAY MASTER FUND LTD
	 	 	 
	 	 	 
	 	 	Name:	                 
	 	 	Title:	 
	 	 	 
	Dated: January __, 2020.	 	ALTO OPPORTUNITY MASTER FUND, SPC-SEGREGATED MASTER PORTFOLIO B
	 	 	 
	 	 	 
	 	 	 
	 	 	Name:	 
	 	 	Title:	 
	 	 	 
	Dated: January __, 2020.	 	NANOVIRICIDES, INC
	 	 	 
	 	 	 
	 	 	 
	 	 	Name:	 
	 	 	Title:	 

 

    - 7
                                                                                      -

     

    

 

Exhibit I  

 

BINDING TERM SHEET

 

	Issuer:	 	NanoViricides, Inc. (the "Company")
	 	 	 
	Investors:	 	Hudson Bay Master Fund Ltd. and Alto Opportunity Master Fund, SPC – Segregated Master Portfolio B (the "Investors")
	 	 	 
	Existing Warrants:	 	Warrants (the "Existing Warrants") to purchase 347,222 shares of the Company’s common stock, par value $0.001 per share (the "Common Stock"), issued by the Company to the Investors in a private placement pursuant to that certain Securities Purchase Agreement, dated February 27, 2019 by and among the Company, the Investors and  any other parties listed on the signature pages attached thereto (the "Existing SPA"). 
	 	 	 
	Exchange:	 	The Company shall exchange the Existing Warrants for: (i) 677,224 shares of Common Stock ("New Common Shares") and (ii) new warrants (the "New Warrants" and together with the New Common Shares, the "New Securities") to purchase 347,222 shares of Common Stock with terms substantially identical to the terms of the Existing Warrants, except for (x) an Exercise Price of $3.00 per share (as adjusted for any stock dividend, stock split, stock combination, reclassification or similar transaction relating to the Common Stock occurring after January 24, 2020) (the "New Exercise Price"), (y) the addition of full ratchet economic anti-dilution protection with respect to the New Exercise Price in the form attached hereto as Annex A for any issuance or deemed issuance of Common Stock by the Company or any of its subsidiaries below the New Exercise Price then in effect and (z) the New Warrant will become exercisable in whole or in part to the extent the Company increases its authorized shares of Common Stock.  The foregoing consideration shall be allocated between the Investors pro rata based on their ownership of the Existing Warrants.
	 	 	 
	Reservation of Shares:	 	As soon as the Company increases its authorized Common Stock, the Company shall reserve no less than 130% of the number of shares of Common Stock issuable upon exercise of the New Warrants for issuances pursuant to the New Warrants (or such lesser number of shares that then becomes authorized).
	 	 	 
	New Securities:	 	The New Securities will be free and clear of any liens, preemptive rights or other encumbrances, duly authorized, duly and validly issued, fully paid and non-assessable. The New Securities will be exempt from registration under the Securities Act of 1933, as amended (the "1933 Act") by virtue of the exemption afforded by Section 3(a)(9) of the 1933 Act.  The New Securities will not bear any restrictive legend and will be freely tradable by the Investors without any restriction or limitation under applicable securities laws.  Company counsel, at the he Company's sole expense, shall provide any necessary legal opinions to affect the foregoing. The New Securities shall be delivered to the Investors on or before Wednesday January 29, 2020.
	 	 	 
	Waiver:	 	In consideration for the transactions set forth in this binding term sheet, the Investors hereby waive any objection raised with respect to the Company’s proposed offering of 2,500,000 shares of Common Stock at $3.00 per share pursuant to the Company’s shelf registration statement on Form S-3, as amended (File No. 333-2355306), which became effective on January 9, 2020.

 

    

     

    

 

	 	 	 
	Final Documents:	 	The Company and the Investors shall in good faith negotiate final documents to implement the foregoing in more detail. The final documentation will contain additional and supplementary provisions, including customary representations, warranties, covenants, agreements, payments and remedies.  If the Company fails to sign final documents on or before 8:00 a.m., New York City time, on January 28, 2020 absent breach of this term sheet by the applicable Investor, the Company shall promptly, but in any event within two (2) business days, pay to each non-breaching Investor cash in the amount of $2,750,000 by wire transfer of immediately available funds in accordance with wire instructions provided by such Investor to the Company in writing, and the Company shall immediately adjust the Existing Warrant strike price to $3.00 per share.
	 	 	 
	Fees and Expenses:	 	The Company shall reimburse each Investor for all of its legal fees and other expenses in connection with the litigation and in connection with the preparation and negotiation of the final documents necessary to implement this binding term sheet.
	 	 	 
	Disclosure:	 	The Company shall file a current report on Form 8-K on or before 8:30 a.m., New York City time, on January 28, 2020, describing the terms of the transactions contemplated by the Settlement Agreement and Mutual Release and this binding term sheet, all in the form required by the Securities Exchange Act of 1934, as amended, and attaching the form of the Settlement Agreement and Mutual Release and this binding term sheet (and all schedules and exhibits thereto not otherwise attached), as exhibits to such filing (including all attachments, the "8-K Filing").  As of immediately following the filing of the 8-K Filing with the SEC, the Investors shall not be in possession of any material, nonpublic information received from the Company, any of its subsidiaries or any of their respective officers, directors, employees, affiliates or agents, that is not disclosed in the 8-K Filing or in prior filings with the SEC.  In addition, effective upon the filing of the 8-K Filing, the Company acknowledges and agrees that any and all confidentiality or similar obligations under any agreement, whether written or oral, between the Company, any of its subsidiaries or any of their respective officers, directors, employees, affiliates or agents, on the one hand, and the Investors or any of their respective affiliates, on the other hand, shall terminate and be of no further force or effect.  The Company understands and confirms that the Investors will rely on the foregoing in effecting transactions in securities of the Company.  The Company shall not, and shall cause its subsidiaries and its and each of their respective officers, directors, employees, affiliates and agents, not to, provide any of the Investors with any material, nonpublic information regarding the Company or any of its Subsidiaries from and after the date hereof without the express prior written consent of such Investor.  

 

    2

     

    

 

Annex 

 

(a)            Adjustment
of Exercise Price upon Issuance of Common Stock. . If and whenever on or after January 24, 2020, the Company publicly
announces or the Company issues or sells, enters into a definitive, binding agreement pursuant to which the Company is required
to issue or sell, or, in accordance with clauses (i) or (ii) of this Section [ ], is deemed to have issued
or sold, any shares of Common Stock (including the issuance or sale of shares of Common Stock owned or held by or for the account
of the Company, but excluding shares of Common Stock deemed to have been issued or sold by the Company in connection with any Excluded
Securities) for a consideration per share (the "New Issuance Price") less than a price (the "Applicable
Price") equal to the Exercise Price in effect immediately prior to such public announcement, issue or sale or deemed issuance
or sale or entry into such a definitive binding agreement (the foregoing a "Dilutive Issuance"), then immediately
after such Dilutive Issuance the Exercise Price then in effect shall be reduced to an amount equal to the New Issuance Price. For
purposes of determining the adjusted Exercise Price under this Section [ ], the following shall be applicable:

 

(i)            Issuance
of Options If the Company in any manner grants or sells or enters into a definitive, binding agreement pursuant to which is
required to grant or sell, or the Company publicly announces the issuance or sale of, any Options and the lowest price per share
for which one share of Common Stock is issuable upon the exercise of any such Option or upon conversion or exchange or exercise
of any Convertible Securities issuable upon exercise of any such Option is less than the Applicable Price, then such share of Common
Stock shall be deemed to be outstanding and to have been issued and sold by the Company at the time of the granting or sale of
such Option for such price per share. For purposes of this Section [ ](i), the "lowest price per share for which
one share of Common Stock is issuable upon the exercise of any such Options or upon conversion or exchange or exercise of any Convertible
Securities issuable upon exercise of such Option" shall be equal to the sum of the lowest amounts of consideration (if any)
received or receivable by the Company with respect to any one share of Common Stock upon granting or sale of the Option, upon exercise
of the Option and upon conversion or exchange or exercise of any Convertible Security issuable upon exercise of such Option less
any consideration paid or payable by the Company with respect to such one share of Common Stock upon the granting or sale of such
Option, upon exercise of such Option and upon conversion exercise or exchange of any Convertible Security issuable upon exercise
of such Option. No further adjustment of the Exercise Price shall be made upon the actual issuance of such shares of Common Stock
or of such Convertible Securities upon the exercise of such Options or upon the actual issuance of such shares of Common Stock
upon conversion or exchange or exercise of such Convertible Securities.

 

(ii)            Issuance
of Convertible Securities. If the Company in any manner issues or sells, or enters into a definitive, binding agreement pursuant
to which is required to grant or sell or the Company publicly announces the issuance or sale of, any Convertible Securities and
the lowest price per share for which one share of Common Stock is issuable upon the conversion or exchange or exercise thereof
is less than the Applicable Price, then such share of Common Stock shall be deemed to be outstanding and to have been issued and
sold by the Company at the time of the issuance or sale of such Convertible Securities for such price per share. For the purposes
of this Section [ ](ii), the "lowest price per share for which one share of Common Stock is issuable upon the conversion
or exchange or exercise thereof" shall be equal to the sum of the lowest amounts of consideration (if any) received or receivable
by the Company with respect to any one share of Common Stock upon the issuance or sale of the Convertible Security and upon the
conversion or exchange or exercise of such Convertible Security less any consideration paid or payable by the Company with respect
to such one share of Common Stock upon the issuance or sale of the Convertible Security and upon the conversion or exchange or
exercise of such Convertible Security. No further adjustment of the Exercise Price shall be made upon the actual issuance of such
shares of Common Stock upon conversion or exchange or exercise of such Convertible Securities, and if any such issue or sale of
such Convertible Securities is made upon exercise of any Options for which adjustment of the Exercise Price has been or is to be
made pursuant to other provisions of this Section [ ], no further adjustment of the Exercise Price shall be made by reason
of such issue or sale.

 

    4

     

    

 

(iii)            Change
in Option Price or Rate of Conversion. If the purchase price provided for in any Options, the additional consideration, if
any, payable upon the issue, conversion, exchange or exercise of any Convertible Securities, or the rate at which any Convertible
Securities are convertible into or exchangeable or exercisable for shares of Common Stock increases or decreases at any time, the
Exercise Price in effect at the time of such increase or decrease shall be adjusted to the Exercise Price which would have been
in effect at such time had such Options or Convertible Securities provided for such increased or decreased purchase price, additional
consideration or increased or decreased conversion rate, as the case may be, at the time initially granted, issued or sold. For
purposes of this Section [ ](iii), if the terms of any Option or Convertible Security that was outstanding as of January 24,
2020 are increased or decreased in the manner described in the immediately preceding sentence, then such Option or Convertible
Security and the shares of Common Stock deemed issuable upon exercise, conversion or exchange thereof shall be deemed to have been
issued as of the date of such increase or decrease. No adjustment pursuant to this Section [ ] shall be made if such
adjustment would result in an increase of the Exercise Price then in effect.

 

(iv)            Calculation
of Consideration Received. If any Option and/or Convertible Security and/or Adjustment Right is issued in connection with the
issuance or sale or deemed issuance or sale of any other securities of the Company (as determined by the Holder, the “Primary
Security”, and such Option and/or Convertible Security and/or Adjustment Right, the “Secondary Securities”,
and together with the Primary Security, each a “Unit”), together comprising one integrated transaction, the
aggregate consideration per share of Common Stock with respect to such Primary Security shall be deemed to be the lower of (x) the
purchase price of such Unit, (y) if such Primary Security is an Option and/or Convertible Security, the lowest price per share
for which one share of Common Stock is at any time issuable upon the exercise or conversion of the Primary Security in accordance
with Section [ ](i) or [ ](ii) above and (z) the lowest VWAP of the Common Stock on any Trading Day
during the five Trading Day period (or, if this Warrant is exercised, in whole or in part, prior to the end of such five (5) Trading
Day Period, with respect to any given portion of this Warrant so exercised, such shorter period ending on the applicable Exercise
Date thereof) immediately following the public announcement of such Dilutive Issuance (for the avoidance of doubt, if such public
announcement is released prior to the opening of the Principal Market on a Trading Day, such Trading Day shall be the first Trading
Day in such four Trading Day period). If any shares of Common Stock, Options or Convertible Securities are issued or sold or deemed
to have been issued or sold for cash, the consideration received therefor will be deemed to be the net amount of consideration
received by the Company therefor. If any shares of Common Stock, Options or Convertible Securities are issued or sold for a consideration
other than cash, the amount of such consideration received by the Company will be the fair value of such consideration, except
where such consideration consists of publicly traded securities, in which case the amount of consideration received by the Company
for such securities will be the arithmetic average of the VWAPs of such security for each of the five (5) Trading Days immediately
preceding the date of receipt. If any shares of Common Stock, Options or Convertible Securities are issued to the owners of the
non-surviving entity in connection with any merger in which the Company is the surviving entity, the amount of consideration therefor
will be deemed to be the fair value of such portion of the net assets and business of the non-surviving entity as is attributable
to such shares of Common Stock, Options or Convertible Securities (as the case may be). The fair value of any consideration other
than cash or publicly traded securities will be determined jointly by the Company and the Holder. If such parties are unable to
reach agreement within ten (10) days after the occurrence of an event requiring valuation (the “Valuation Event”),
the fair value of such consideration will be determined within five (5) Trading Days after the tenth (10th) day
following such Valuation Event by an independent, reputable appraiser jointly selected by the Company and the Holder. The determination
of such appraiser shall be final and binding upon all parties absent manifest error and the fees and expenses of such appraiser
shall be borne by the Company.

 

(v)            Record
Date. If the Company takes a record of the holders of shares of Common Stock for the purpose of entitling them (A) to
receive a dividend or other distribution payable in shares of Common Stock, Options or in Convertible Securities or (B) to
subscribe for or purchase shares of Common Stock, Options or Convertible Securities, then such record date will be deemed to be
the date of the issue or sale of the shares of Common Stock deemed to have been issued or sold upon the declaration of such dividend
or the making of such other distribution or the date of the granting of such right of subscription or purchase, as the case may
be.

 

(vi)            No
Readjustments. For the avoidance of doubt, in the event the Exercise Price has been adjusted pursuant to this Section [ ]
and the Dilutive Issuance that triggered such adjustment does not occur, is not consummated, is unwound or is cancelled after the
facts for any reason whatsoever, in no event shall the Exercise Price be readjusted to the Exercise Price that would have been
in effect if such Dilutive Issuance had not occurred or been consummated.

 

    5

     

    

 

Defined terms:

 

“Adjustment Right” means any right granted
with respect to any securities issued in connection with, or with respect to, any issuance or sale (or deemed issuance or sale
in accordance with Section [ ]) of shares of Common Stock that could result in a decrease in the net consideration received
by the Company in connection with, or with respect to, such securities (including, without limitation, any cash settlement rights,
cash adjustment or other similar rights).

 

"Convertible Securities" means any stock or
securities (other than Options) directly or indirectly convertible into or exercisable or exchangeable for shares of Common Stock.

 

"Excluded Securities"
means any shares of Common Stock issued or issuable: (i) in connection with any Approved Stock Plan; (ii) pursuant to
the terms of the Warrants; provided that the terms of such Warrants are not amended, modified or changed on or after January 24,
2020; and (iii) upon exchange, conversion or exercise of any Options or Convertible Securities which are outstanding on the
day immediately preceding January 24, 2020, provided that the terms of such Options or Convertible Securities are not
amended, modified or changed on or after the January 24, 2020.

 

"Options" means any rights, warrants or options
to subscribe for or purchase shares of Common Stock or Convertible Securities.

 

A

 

    6

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00303-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00303-of-00352.parquet"}]]