Document:

EX-10.1

  FIRST AMENDED AND RESTATED EMPLOYMENT AGREEMENT

   

  THIS	FIRST	AMENDED	AND	RESTATED	EMPLOYMENT	AGREEMENT

  (hereinafter “Agreement”) is made and entered into as June _23  , 2022, by and between GENERATION INCOME PROPERTIES, INC., a Maryland corporation (“Company”), and DAVID SOBELMAN, an individual residing in the State of Florida (hereinafter called “Employee”). This Agreement amends and restates in its entirety that certain Employment Agreement, dated December 20, 2019, previously entered into between Company and Employee (the “Prior Employment Agreement”).

   

  RECITALS

   

  WHEREAS, Employee is currently employed as President and Chief Executive Officer of Company upon the terms and conditions set forth in the Prior Employment Agreement; and

   

  WHEREAS, Company seeks to continue to employ Employee as the President and Chief Executive Officer of Company and to amend and restate the Prior Employment Agreement upon the terms and conditions set forth herein.

   

  NOW THEREFORE, in consideration of Employee’s continued employment with Company and the mutual covenants and promises set forth in this Agreement and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties, intending to be legally bound, agree as follows:

   

  1.RECITALS. All of the foregoing recitals are true and correct and incorporated herein by this reference.

   

  2.EMPLOYMENT.

   

  (a)Position and Duties.

   

  (i)Work for Company. Employee shall be employed by Company as its President and Chief Executive Officer, reporting to the Board of Directors of Company (the “Board”), and he shall have such job duties as are assigned to Employee by the Board from time to time that are generally consistent with the title of President and Chief Executive Officer. As President and Chief Executive Officer, Employee serves as Company’s “principal executive officer” for purposes of the rules and regulations of the Securities and Exchange Commission. The Employee’s employment by Company shall be full-time, and the Employee agrees to diligently and conscientiously devote substantially all of his business time and attention to the performance of the Employee’s duties hereunder and will not engage in any other business, profession, occupation, or activity for compensation or otherwise which would conflict or interfere with the performance of such services either directly or indirectly without the prior written consent of the Board.

   

  (ii)Location of Employment Services. Employee’s regular place of employment will be the Company’s principal executive office in Tampa, Florida, subject to such travel as will be required in furtherance of the performance of Employee’s duties hereunder.

   

  (iii)Subsidiaries and Affiliates. With respect to Company’s direct and indirect subsidiaries, affiliated corporations, partnerships, or joint ventures, including serving as

   

   

  

  the President and Chief Executive Officer of Company’s operating partnership, Generation Income Properties, L.P., (collectively, “Related Entities”), Employee shall perform the above-described duties to promote these Related Entities and to promote and protect their respective interests to the same extent as the interests of the Company without additional compensation. Compensation for all services performed by Employee as described herein will be paid Generation Income Properties, L.P. For purposes hereof, the term “Company Group” refers to Company and the Related Entities collectively.

   

  (b)Compensation.

   

  (i)Base Salary. Employee shall be initially paid a base salary of $100,000.00 per year, which shall increase to $200,000.00 per year effective July 1, 2022 (the “Salary). The Salary will be (i) pro-rated for any period less than twelve (12) months; (ii) paid in accordance with the Company Group’s customary payroll procedures and (iii) subject to applicable taxes and withholdings. The Salary will be reviewed by the Board (or the Compensation Committee thereof) annually each year on or before March 31 and may be increased by the Board, but not decreased, unless otherwise agreed to in writing by Employee.

   

  (ii)Benefits. Employee is eligible to receive such medical, health, vacation, and other benefits as are provided by the Company Group, in its discretion, from time to time to its employees generally, provided that Company Group will pay 100% of the premium cost of such benefits. Employee will also be eligible to participate in any 401(k) plan that the Company or its Related Entities may adopt in the future. The Company Group shall reimburse Employee for all reasonable costs and out-of-pocket expenses incurred by Employee in connection with the performance of Employee’s duties under this Agreement, subject to and in accordance with Company Group’s standard policies (including expense verification policies) regarding the reimbursement of business expenses incurred by employees of Company Group on its behalf, as the same may be modified from time to time. Nothing in this Agreement will preclude Company Group from amending or terminating any of the employee benefit plans or programs applicable to employees of the Company Group as long as such amendment or termination is applicable to all similarly- situated employees.

   

  (iii)Equity Compensation. On or before March 31 of each year during the term of Employee’s employment and solely at the discretion of the Board, Employee shall receive an annual grant of fully vested stock under the Generation Income Properties, Inc. 2020 Omnibus Incentive Plan based on the Company’s achievement of Board-established criteria, which may include meeting the Company’s target for “Core Adjusted Funds from Operations” for the immediately preceding fiscal year.

   

  (iv)Performance Bonuses. On or before March 31 of each year, Employee shall be entitled to receive, upon the approval of the Board, a discretionary annual performance- based bonus with a minimum bonus target amount of 35% of his then current Salary (“Performance Bonus Target”) based on the Company meeting the Board-established performance criteria for the immediately preceding fiscal year, which may include meeting the Company’s target for “Core Adjusted Funds from Operations” for the immediately preceding fiscal year.

   

  (v)Death and Disability Policy. In addition to the foregoing compensation, the Company Group shall pay Employee an amount equal to $7,500 per calendar year to be

   

   

  

  used solely to cover the actual cost to Employee of obtaining a death and disability insurance policy on Employee’s life and for related costs and expenses.

   

  (vi)Withholding. The Company Group shall be entitled to deduct or withhold from any amounts owing from the Company Group to Employee any federal, state, local or foreign withholding taxes, excise taxes or employment taxes imposed with respect to Employee’s compensation or other payments from the Company Group, including wages, bonuses, distributions and/or the receipt or vesting of incentive equity.

   

  (vii)Clawback Provisions. Notwithstanding any other provisions in this Agreement to the contrary, any bonus (if any) paid to the Employee will be subject to such potential clawback as may be required to be made pursuant to applicable federal or state law or applicable stock exchange listing requirements governing potential clawback of Employee compensation upon a determination by legal counsel to Company that clawback is required by federal or state law or applicable stock exchange listing requirements.

   

  (c)Term of Employment. Subject to the terms and conditions of this Agreement, the term of Employee’s employment by Company shall commence on the date of this Agreement and shall continue until terminated in accordance with Section 3 herein. The parties acknowledge, subject to the provisions of Section 3 of this Agreement, that Employee’s employment with the Company Group is on an at-will basis, and either Company Group or Employee may therefore terminate the Employee’s employment, with or without cause, at any time and for any reason upon the terms and conditions specified in Section 3 below.

   

  (d)Guarantee and Guarantee Fee. For any guarantee for which Employee is personally the guarantor, then upon separation of employment, Employee shall immediately be removed from such guarantee or, if that cannot be effectuated, then the Company will use commercially reasonable efforts to retire or refinance the debt within thirty (30) days of Employee’s separation. So long as Employee remains on the guarantee, Employee shall receive an annual guarantee fee of one percent (1%) of the amount of the guaranteed indebtedness for a full guarantee and a half percent (0.5%) for any non-recourse/fraud exception guarantee (“Guarantee Fee”). Only in the event of a termination of Employee’s employment by the Company without Cause pursuant to Section 3(a)(iv) below or by the Employee pursuant to a Good Reason Resignation (as defined below), if the Company is unable to retire or refinance the debt within sixty (60) days of Employee’s separation, the annual guarantee fee for any debt subject to guarantee by Employee shall increase to ten percent (10%) of the guaranteed indebtedness from and after such 60-day period. The Guarantee Fee will be paid in arrears and prorated for any portion of any calendar in which Employee makes the guarantee. The Guarantee Fee is to be paid by January 15th of each year. The Guarantee Fee will be paid only on guarantees by Employee that are approved by the Board.

   

  3.TERMINATION.

   

  (c)Types of Terminations. This Agreement and Employee’s employment hereunder shall terminate upon the happening of any of the following events:

   

  (vi)Employee’s death (“Termination Upon Death”);

   

  (vii)the effective date of a written notice sent to Employee stating Company’s determination, made in good faith, that due to a mental or physical condition, Employee has been unable and failed to substantially render the services to be provided by Employee to Company for

   

   

  

  a period of at least (x) 180 days out of any consecutive 360 days or (y) 90 consecutive days (“Termination For Disability”);

   

  (iii)the effective date of a written notice sent to Employee stating Company’s determination, made in good faith, that it is terminating Employee’s employment for Cause (as defined below) (“Termination For Cause”);

   

  (iv)the effective date of a termination based on a notice sent to Employee stating that Company is terminating Employee’s employment not for Cause, which written notice shall be provided to Employee at least sixty (60) days in advance of the effective date of termination, with the Company reserving the right in its sole discretion to require Employee not to work any portion of the notice period and to not access Company premises and assets, provided that the Company will nevertheless continue to pay Employee’s compensation for the entire notice period (“Termination Without Cause”); or

   

  (v)the effective date of a termination based on a notice sent to Company from Employee stating that the Employee is resigning, which notice must be given by Employee to Company at least sixty (60) days in advance of the intended date of termination (a “Resignation”), provided that if the Resignation is a Good Reason Resignation, then Employee shall follow the procedures described in Section 3(c)(v) below.

   

  As used herein, the term “Cause” shall mean (i) commission of a willful act of dishonesty in the course of Employee’s duties hereunder or misappropriation of funds, theft, or embezzlement by Employee of Company Group funds or property, (ii) conviction by a court of competent jurisdiction of, or plea of no contest to, a crime constituting a felony or conviction in respect of, or plea of no contest to, any act involving fraud, dishonesty or moral turpitude, (iii) Employee’s gross or willful misconduct (whether or not directly related to the Company Group or its business) or illegal conduct that impairs the performance of Employee’s duties or that is injurious to the Company Group, including without limitation injurious to the reputation of the Company Group,

  (iv) Employee’s performance under the influence of controlled substances (other than those taken pursuant to a medical doctor’s orders), or continued habitual intoxication, during working hours,

  (v) Employee’s personal misconduct or refusal or material failure to timely perform his duties and responsibilities or to timely carry out the lawful directives of Company Group, which, if capable of being cured shall not have been cured, within thirty (30) days after Company shall have advised Employee in writing of its intention to terminate Employee’s employment; provided, that such right to cure shall not apply to any subsequent act or omission of a substantially similar nature or type, or (vi) Employee’s material non-compliance with the terms of this Agreement or any Company Group policy, which, if capable of being cured, shall not have been cured within thirty

  (30) days after Company shall have advised Employee in writing of its intention to terminate Employee’s employment for such reason.

   

  (b)Effect of Termination.

   

  (iii)In the event of Termination Upon Death or Termination For Disability:

   

  (A)Employee (or Employee’s legal representative) shall be entitled to receive wages in an amount equal to any earned but unpaid Salary owing by Company to Employee as of the termination date (the “Accrued Salary”); and

   

  (B)Employee shall be entitled to receive an amount equal to any unpaid Performance Bonus Target for any completed fiscal year plus a prorated portion of the Performance Bonus Target for the fiscal year of termination (“Accrued Bonus”).

   

  

   

   

  

  (ii)Termination For Cause or Resignation. In the event of a Termination For Cause or a Resignation (other than a Good Reason Resignation), Employee shall be entitled to receive only an amount equal to any Accrued Salary.

   

  (iii)In the event of Termination Without Cause or a Good Reason Resignation:

   

  (A)Employee (or Employee’s legal representative) shall be entitled to receive Accrued Salary through the sixty (60) days after Employer gives Employee advance notice of the intended date of termination;

   

  (B)Employee shall be entitled to any Accrued Bonus;

   

  (C)Employee shall be entitled to receive wages in an amount equal to the greater of (i) twelve (12) months of Employee’s Salary (at the rate in effect at time of termination) or (ii) the amount of Salary (at the rate in effect at time of termination) that would have been paid to Employee had his employment continued through December 31, 2025, payable in the manner set forth below (“Separation Compensation”); provided, however, that if Employee becomes re-employed at any time during the twelve (12) months following the effective date of Employee’s termination of employment with the Company (the “Separation Compensation Period”), then his Separation Compensation shall be reduced by any base salary or base wages received by Employee from his successor employment during the final six months of the Separation Compensation Period;

   

  (D)Company shall pay additional Separation Compensation to Employee , in eighteen (18) equal monthly installments (and subject to applicable tax and other withholdings), an amount equal to the premium payments for continuing healthcare coverage for Employee and his family under the Consolidated Omnibus Budget Reconciliation Act of 1985 (COBRA) for an 18-month period following the effective date of termination, if Employee elects and remains entitled to COBRA continuation coverage during that 18-month time period (“Benefit Payments”); and

   

  (E)Notwithstanding anything to the contrary set forth in any Company equity plan or award agreement, all unvested stock options, restricted stock awards, or other equity awards then held by Employee shall immediately vest as of the date of termination and thereafter be exercisable in accordance with the terms and conditions of such awards.

   

  (iv)In the event of a Termination Without Cause or a Good Reason Resignation that occurs within twelve (12) months after the completion or closing of a Change of Control, the Separation Compensation shall be an equal to the greater of (i) two (2) times the sum of (A) the Accrued Bonus and (B) twelve months of Employee’s Salary (at the rate in effect at time of termination), or (ii) the amount otherwise payable pursuant to Section 3(b)(iii)(C), which amount shall be payable in a single lump sum within thirty (30) business days after the effective date of termination of employment. For purposes hereof, the term “Change of Control” shall have the meaning set forth in the Generation Income Properties, Inc. 2020 Omnibus Incentive Plan as in effect on the date of this Agreement.

   

  (c)Additional Provisions.

   

  (ii)Subject to the provisions in the following paragraph, any amounts to be paid pursuant to this Section 3 shall be paid in accordance with Company’s existing payroll or bonus 

   

  

  payment practices, as applicable, subject to applicable taxes and withholdings.

   

   

  

  (ii)The Separation Compensation (if payable) will be paid according to Company’s normal payroll cycle in installments (“Separation Payments”) that are each equal to the regular Salary payments being made to the Employee immediately prior to termination of employment, beginning with the first payroll which occurs at least seven (7) days after Company’s receipt of a fully executed Release (as defined below) and ending upon the final payment of the Severance Compensation; provided, however that any amount due under Section 3(b)(iv) above shall be paid in a lump sum in accordance with Section 3(b)(iv). Separation Payments and Accrued Bonus shall be subject to tax withholdings and other required withholdings. Notwithstanding the foregoing, the Employee’s right to receive any Separation Compensation, Separation Payments or Accrued Bonus pursuant to this Agreement is conditioned upon the Employee signing (and not revoking), by the twenty-first (21st) day after the Employee’s last day of employment, a general release of claims (except those rights arising under this Agreement) in substantially the form provided by attached as “Exhibit A” (the “Release”).

   

  (iii)Notwithstanding any provision of this Agreement to the contrary, the obligations and commitments under Section 4 of this Agreement shall survive and continue in full force and effect in accordance with their terms notwithstanding any termination of Employee’s employment for any reason or termination of this Agreement for any reason.

   

  (iv)Notwithstanding anything in this Agreement to the contrary, Company shall have no obligation to pay any amounts payable under Section 3(b)(iii)(C) of this Agreement during such times as it is determined by a court of law that Employee is in breach of Section 4 of this Agreement, after Company provides Employee with notice of such breach.

   

  (v)Employee shall have the right to resign his employment for “Good Reason” if:

  (A) there is a material adverse change or material diminution in Employee’s duties, responsibilities, functions, reporting lines, or title with Company, including if Employee ceases to be the principal executive officer of the Company and/or ceases to report directly to a board of directors comprised of a majority of directors that are “independent” within the rules and regulations of Nasdaq, (B) there is a material reduction in the compensation or benefits payable to Employee hereunder, (C) there is a material breach of the provisions of this Agreement or (D) without Employee’s consent, Employee’s principal place of employment is relocated to a place outside of a 50 mile radius from the location of the Company’s offices in Tampa, Florida. Employee cannot terminate his employment for Good Reason unless he has provided written notice to the Company of the existence of the circumstances providing grounds for termination for Good Reason within fifteen (15) days of the initial existence of such grounds and if curable, Company has had at least thirty (30) days from the date on which such notice is provided to cure such circumstances (and has failed to cure such circumstances within such period). If not curable, or if Company has not, within such thirty (30) day period, cured the circumstances providing ground for termination for Good Reason and Employee does not terminate his employment for Good Reason within ten (10) days after the expiration of Company’s cure period in the preceding sentence, Employee will be deemed to have waived his right to terminate for Good Reason with respect to such grounds. The Employee acknowledges that the Board has flexibility under Section 2(a) to reasonably assign Employee a broad range of responsibilities and duties that are consistent with his duties as President and Chief Executive Officer and to make changes in the Employee’s responsibilities in a manner that is materially consistent with the duties described under Section 3(a), and such assignments and change will not constitute “Good Reason.” A Resignation that is effected in accordance with this paragraph is referred to as a “Good Reason Resignation.”

   

  (vi)Upon termination of Employee’s employment for any reason, Employee shall be deemed to have resigned from all positions held with Company and its Related Entities,

   

  

   

   

  

  including, without limitation, any position as an officer, agent, trustee, or consultant of Company or any Related Entity, unless the Board expressly determines otherwise; provided, however, that unless otherwise agreed in writing by Employee, Employee’s termination of employment will not result in Employee’s deemed resignation as a member of the Board. Upon request of Company, Employee shall promptly sign and deliver to the Company Group any and all documents reflecting such resignations as of the effective date of termination.

   

  4.NON-COMPETITION, NON-SOLICITATION AND CONFIDENTIALITY.

   

  (a)Definitions.

   

  “Company’s Business” means the Company Group’s business of purchasing and leasing to tenants triple-net lease business properties.

   

  “Competitor” means any company, other entity or association or individual that directly or indirectly is engaged in Company’s Business.

   

  “Confidential Information” means any confidential information with respect to the Company or any Related Entity or the Company’s Business including, but not limited to: the trade secrets of Company and any Related Entities; manuals and documentation; databases; Company Group’s existing and prospective clients and customers (including tenants), sales lists, agent lists, vendor lists, plans, specifications, price lists, and other similar and related information in whatever form. The term Confidential Information does not include, and there shall be no obligation hereunder with respect to, information that (i) is generally available to the public on the date of this Agreement, (ii) becomes generally available to the public other than as a result of a disclosure by Employee not otherwise permissible hereunder or (iii) Employee has learned or learns from other sources where, to Employee’s knowledge, such sources have not violated their confidentiality obligation to Company or any other applicable obligation of confidentiality.

   

  (b)Non-competition. Employee covenants and agrees that during the period of his employment with Company and ending twelve (12) months following termination of his employment with the Company, regardless of the reason (the “Restricted Period”), Employee will not, directly or indirectly, own, manage, engage, participate on behalf of himself or any other person or entity, operate, control, become employed by, or render any service to (whether as owner, beneficial owner, partner, associate, agent, independent contractor, consultant, lender, employee, stockholder, officer or in any other capacity) any Competitor anywhere in the United States of America in any state where the Company owns property (or has a property under contract) as of the day of Employee’s separation.

   

  (c)Non-solicitation of Employees. Employee covenants and agrees that during the period of his employment with the Company and ending twelve (12) months following termination of his employment with the Company, regardless of the reason for termination, Employee will not, directly or indirectly, employ or solicit, receive or accept the performance of services by any then current officer, manager, employee or independent contractor of Company or any subsidiary or affiliate of Company, or in any way interfere with the relationship between Company or any subsidiary or affiliate of Company, on the one hand, and any such officer, manager, employee or independent contractor, on the other hand.

   

  (d)Representations and Covenants by Employee. Employee represents and warrants that: (i) Employee’s execution, delivery and performance of this Agreement do not and will not conflict with, breach, violate or cause a default under any contract, agreement, instrument, order, judgment or decree to which Employee is a party or by which Employee is bound; (ii) Employee

   

  

   

   

  

  is not a party to or bound by any employment agreement, noncompete agreement or confidentiality agreement with any other person or entity (other than Company) and Employee is not subject to any other agreement that would prevent or in any manner restrict Employee from performing Employee’s duties for Company or otherwise complying with this Agreement; (iii) Employee is not subject to or in breach of any nondisclosure agreement, including any agreement concerning trade secrets or confidential information owned by any other party; and (iv) upon the execution and delivery of this Agreement by Company, this Agreement shall be the valid and binding obligation of Employee, enforceable in accordance with its terms.

   

  (e)Non-disclosure of Confidential Information. Employee hereby acknowledges and represents that Employee has consulted with independent legal counsel regarding Employee’s rights and obligations under this Agreement and that Employee fully understands the terms and conditions contained herein and Employee agrees that Employee will not, directly or indirectly:

  (i) use, disclose, reverse engineer or otherwise exploit for Employee’s own benefit or for the benefit of anyone other than Company the Confidential Information except as authorized by Company; (ii) during Employee’s employment with Company, use, disclose, or reverse engineer

  (x) any confidential information or trade secrets of any former employer or third party, or (y) any works of authorship developed in whole or in part by Employee during any former employment or for any other party, unless authorized in writing by the former employer or third party; or

  (iii) upon Employee’s resignation or termination (x) retain Confidential Information, including any copies existing in any form (including electronic form), that are in Employee’s possession or control, or (y) destroy, delete or alter the Confidential Information without Company’s consent. Notwithstanding the foregoing, Employee may use the Confidential Information in the course of performing Employee’s duties on behalf of Company or any subsidiary or affiliate of Company as described hereunder, provided that such use is made in good faith. Further, to the extent required by subpoena or applicable law, Employee is permitted to utilize such information in connection with any governmental request, subpoena, investigation or audit. Company simply requests advance notice of seven (7) business days prior to any such disclosure so that Company can assert objections (if necessary) or otherwise participate. Upon separation of employment or suspension (for any reason), Employee will immediately surrender possession of all Confidential Information to Company. Nothing in this Agreement is intended to discourage or restrict Employee from reporting any theft of trade secrets pursuant to the Defend Trade Secrets Act of 2016 (the “DTSA”) or other applicable state or federal law. The DTSA prohibits retaliation against an employee because of whistleblower activity in connection with the disclosure of trade secrets, so long as any such disclosure is made either (i) in confidence to an attorney or a federal, state, or local government official and solely to report or investigate a suspected violation of the law, or (ii) under seal in a complaint or other document filed in a lawsuit or other proceeding.

   

  (f)Inventions and Patents. Employee acknowledges that all (i) inventions, innovations, improvements, developments, methods, designs, analysis, drawings, reports, processes, novel concepts, ideas, copyrights, trademarks and service marks relating to any present or prospective activities of Company, including but not limited to structures, processes, software, formula, techniques and improvements to the foregoing or to know how, and all similar or related information (whether or not patentable) that relate to the Company Business, (ii) research and development and (iii) existing or future products or services that are, to any extent, conceived, developed or made by Employee while employed by Company or any subsidiary or affiliate of Company (“Work Product”) belong to Company or such subsidiary or affiliate. Employee shall promptly disclose such Work Product to Company and, at the cost and expense of Company, perform all actions reasonably necessary or requested by Company (whether during or after the Term) to establish and confirm such ownership (including, without limitation, executing assignments, consents, powers of attorney and other instruments).

   

   

  

  (g)Miscellaneous.

   

  (i)Employee acknowledges that (x) Employee’s position is a position of trust and responsibility with access to Confidential Information of Company, (y) the Confidential Information, and the relationship between Company and each of its employees, customers, tenants, and vendors, are valuable assets of Company and may not be converted to Employee’s own use and (z) the restrictions contained in this Section 4 are reasonable and necessary to protect the legitimate business interests of Company and will not impair or infringe upon Employee’s right to work or earn a living after Employee’s employment with Company ends.

   

  (ii)Each of the foregoing obligations shall be enforceable independent of any other obligation, and the existence of any claim or cause of action that Employee may have against Company, whether predicated on this Agreement or otherwise, shall not constitute a defense to the enforcement by Company of these obligations.

   

  (iii)Employee acknowledges that monetary damages will not be an adequate remedy for Company in the event of a breach of this Agreement and that it would be impossible for Company to measure damages in the event of such a breach. Therefore, Employee agrees that, in addition to other rights that Company may have at law or equity, Company is entitled to seek an injunction preventing Employee from any breach of this Agreement.

   

  (iv)In the event of a breach or violation of any restriction in Sections 4(b) or 4(c) of this Agreement, the prior of time such any such restriction remains in effect shall be tolled until such breach or violation has been cured.

   

  (v)The parties agree that the foregoing restrictive covenants are reasonable and necessary to protect Company’s legitimate business interests. The parties, however, do not intend to include a provision that contravenes the public policy of any state. Therefore, if any provision of this Section 4 is unlawful, against public policy or otherwise declared void, such provision shall not be deemed part of this Agreement, which otherwise shall remain in full force and effect. If, at the time of enforcement of this Agreement, a court or other tribunal holds that the duration, scope or area restriction stated herein is unreasonable under the circumstances then existing, the parties agree that the court should enforce the restrictions to the extent it deems reasonable.

   

  (vi)Employee hereby agrees that prior to accepting employment with any other person or entity during the term of employment or during the Restricted Period following the termination date, Employee will provide such prospective employer with written notice of the existence of this Agreement and the provisions of this Section 4 of this Agreement, with a copy of such notice delivered simultaneously to Company in accordance with Section 7 of this Agreement.

   

  (vii)Notwithstanding any provision of this Agreement, the obligations and commitments of this Section 4 shall survive and continue in full force and effect in accordance with their terms notwithstanding any termination of Employee’s employment for any reason or termination of this Agreement for any reason.

   

  5.REMEDIES.

   

  (i)Employee agrees and acknowledges that a breach on the part of Employee of the covenants contained in Section 4 will cause irreparable harm to Company and that damages arising out of such breach may be difficult to determine. Employee, therefore, further agrees that in addition to all other remedies provided at law or at equity, Company shall be entitled as a matter of course to specific performance and temporary and permanent injunctive relief, from any court

   

  

   

   

  

  of competent jurisdiction restraining any further breach of any such covenant by Employee, his employers, employees, partners, agents or other associates, or any of them, without the necessity of proving actual damage to Company by reason of any such breach. If the Company is the prevailing party in any suit under this Agreement, Employee will reimburse Company for its expenses incurred in connection with such a suit, including attorneys’ fees and costs incurred at any level (including all appeals). In addition, the period of the restriction specified in Section 4 above shall cease to run during the continuance of any violation of Section 4 and any portion of the period remaining at the commencement of any such violation will begin to run again only upon the full cure of the violation.

   

  (ii)Employee further agrees and acknowledges that in addition to any injunctive relief and recovery of attorneys’ fees and costs as set forth above and because the exact amount of damage suffered by Company in the event of a violation by Employee of any of the restrictions set forth in Section 4 may be difficult to calculate, and as such Employee shall be liable to Company for any monetary damages suffered. The existence of any claim or cause of action of Employee against Company of whatever nature shall not constitute a defense to the enforcement by Company of the covenants set forth in Section 4 of this Agreement.

   

  6.ASSIGNMENT. Company may assign this Agreement and any of the rights or obligations hereunder to any third party in connection with the sale, merger, consolidation, reorganization, liquidation or transfer, in whole or in part, of Company’s control and/or ownership of its assets or business. In such event, Employee continues to be bound by the terms of this Agreement. An assignment of this Agreement by Employee or any right or obligation hereunder is strictly prohibited.

   

  7.NOTICES. All notices, requests, consents and other communications required or permitted to be given hereunder, shall be in writing and shall be delivered personally or sent by overnight courier or mailed, first class, postage prepaid by registered or certified mail, as follows:

   

  If to Company:	c/o Generation Income Properties, Inc.

  401 East Jackson Street, Suite 3300

  Tampa, Florida 33602

   

  If to Employee:	To Employee’s address as reflected on the payroll records of

  Company

   

  or such other address as either party shall designate by notice in writing to the other in accordance herewith. Any such notice shall be deemed given when so delivered personally, by e-mail, by facsimile transmission, or if sent by overnight courier, one day after delivery to such courier by the sender or if mailed, five days after deposit by the sender in the U.S. mails.

   

  8.GOVERNING LAW. This Agreement shall be subject to and governed by the laws of the State of Florida, without giving effect to the principles of conflicts of law under Florida law that would require or permit the application of the laws of a jurisdiction other than the State of Florida and irrespective of the fact that the parties now or at any time may be residents of or engage in activities in a different state.

   

  9.DISPUTE RESOLUTION.

   

  (a)Arbitration. Company and Employee agree that any dispute, controversy or claim arising out of or related in any way to Employee’s employment relationship with Company, the termination of that relationship, this Agreement, and/or any breach of this Agreement, shall be

   

  

   

   

  

  submitted to and decided by binding arbitration in Hillsborough County in the State of Florida. By continuing employment with Company, Employee accepts and consents to be bound by this agreement to arbitrate (the “Arbitration Provision”). This Arbitration Provision covers all grievances, disputes, claims or causes of action that otherwise could be brought in a federal, state or local court under applicable federal, state or local laws, arising out of or relating to Employee’s employment with Company and the termination thereof, including claims Employee may have against Company or against its officers, directors, supervisors, managers, employees or agents in their capacity as such or otherwise. The claims covered by this Arbitration Provision include, but are not limited to, claims for breach of any contract or covenant (express or implied); tort claims; claims for wages or other compensation due; claims for wrongful termination (constructive or actual); claims for discrimination or harassment (including, but not limited to, harassment or discrimination based on race, age, color, sex, gender, national origin, alienage or citizenship status, creed, religion, marital status, partnership status, military status, predisposing genetic characteristics, medical condition, psychological condition, mental condition, criminal accusations and convictions, disability, sexual orientation, or any other trait or characteristic protected by federal, state or local law); claims for violation of any federal, state, local or other governmental law, statute, regulation or ordinance; and claims or disputes concerning the validity, enforceability, arbitrability or scope of this Arbitration Provision. Claims not covered by this Arbitration Provision are claims for workers’ compensation or unemployment compensation benefits; at Company’s sole option, claims by Company for injunctive or other equitable relief for the breach or threatened breach of the covenants above; and any other claims that, as a matter of law, Company and Employee cannot agree to arbitrate. Nothing herein shall impair Employee’s right to report possible violations of law to any government agency or cooperate with any agency’s investigation. Company shall pay all costs associated with any arbitration, including the filing fee, hearing costs, and any other arbitration costs, but excluding the cost and expense of legal counsel to Employee.

   

  Company and Employee expressly intend and agree that: (a) class, collective and/or representative action procedures shall not be asserted, nor will they apply, in any arbitration pursuant to this Arbitration Provision; (b) Employee will not assert class, collective and/or representative action claims against Company or its officers, directors, supervisors, managers, employees or agents in arbitration or otherwise; and (c) Employee shall only submit his own, individual claims in arbitration and will not seek to represent the interests of any other person. Further, Company and Employee expressly intend and agree that any claims by Employee will not be joined, consolidated or heard together with claims of any other employee.

   

  The Arbitrator shall apply the substantive law of the State of Florida or federal law (and the law of remedies, if applicable) as applicable to the claims asserted and shall apply the same rules of evidence as a federal court. Arbitration shall be administered in accordance with the AAA Employment Arbitration Rules in effect at the time the arbitration is commenced. To the extent not provided for in the AAA Employment Arbitration Rules, the Arbitrator has the power to order discovery upon a showing that discovery is necessary for a party to have a fair opportunity to present a claim or defense, and the Arbitrator shall decide all discovery disputes. Employee’s agreements to arbitrate and participate only in his individual capacity are contracts under the Federal Arbitration Act and any other laws validating such agreements. No failure to strictly enforce these agreements will constitute a waiver or create any future waivers. If any part of this Arbitration Provision is adjudged to be void or otherwise unenforceable, in whole or in part, the void or unenforceable portion shall be severed and such adjudication shall not affect the validity of the remainder of this Arbitration Provision and/or this Agreement. Any arbitral award determination shall be final and binding upon the parties. Judgment on the award rendered by the arbitrator may be entered in any court having jurisdiction thereof.

   

   

  

  (b)Injunctive Relief. Nothing in the Arbitration Provision and/or this Agreement shall prevent Company from applying to and obtaining from a court of competent jurisdiction a writ of attachment, a temporary restraining order, a permanent restraining order, a temporary injunction, a permanent injunction, or other injunctive relief available to safeguard and protect Company’s interests, including but not limited to Company’s interests in the restrictive covenants contained herein. Any action, suit or other proceeding initiated for these purposes shall be brought in the State of Florida in the Thirteenth Judicial Circuit in and for Hillsborough County, Florida or in the United States District Court for the Middle District of Florida and Employee agrees to submit himself to the exclusive personal jurisdiction and venue of those courts for such purposes.

   

  (c)WAIVER OF JURY TRIAL. COMPANY AND EMPLOYEE UNDERSTAND AND AGREE THAT THEY ARE WAIVING ANY RIGHT TO JURY TRIAL WITH RESPECT TO ANY DISPUTE, CONTROVERSY OR CLAIM ARISING OUT OF OR RELATED IN ANY WAY TO EMPLOYEE’S EMPLOYMENT RELATIONSHIP WITH THE COMPANY, THE TERMINATION OF THAT RELATIONSHIP, THIS AGREEMENT, AND/OR ANY BREACH OF THIS AGREEMENT. COMPANY AND EMPLOYEE EXPRESSLY ACKNOWLEDGE AND AGREE THAT THEY ARE WAIVING ANY RIGHT THEY MAY HAVE TO A JURY TRIAL BY SIGNING THIS AGREEMENT.

   

  10.INVALIDITY. Any provision herein which in any way contravenes the applicable laws of any country, state or jurisdiction shall be severed from this Agreement and deemed not to be considered part of this Agreement and this Agreement shall not be invalid as a whole because of any such determination.

   

  11.INDULGENCE. No indulgence extended by either party hereto to the other party shall be construed as a waiver of any breach on the part of such other party, nor shall any waiver of one breach be construed as a waiver of any rights or remedies with respect to any subsequent breach.

   

  12.ENTIRE AGREEMENT AND CHANGES TO BE IN WRITING.  Except as

  otherwise indicated herein, this Agreement shall constitute the entire agreement between Employee and Company concerning the subject matter hereof. This Agreement supersedes and preempts any prior employment agreement or other understandings, agreements or representations by or among the parties, written or oral, that may have related to the subject matter hereof. No provisions of this Agreement may be modified, waived or discharged unless such waiver, modification or discharge is agreed to in writing, signed by Employee and an authorized officer of Company.

   

  13.NON-DISPARAGEMENT. Employee agrees to not make any statements, written or oral, while employed by Company and thereafter, which would be reasonably likely to disparage or damage Company, its affiliates or subsidiaries or the personal or professional reputation of any present or former employees, officers or members of the managing or directorial boards or committees of Company or its affiliates or subsidiaries. Company shall not make official statements disparaging Employee and shall further instruct all officers and directors of the Company not to make disparaging comments regarding Employee.

   

  14.STRICT COMPLIANCE. Employee’s or Company’s failure to insist upon strict compliance with any provision of this Agreement or the failure to assert any right Employee or Company may have hereunder shall not be deemed to be a waiver of such provision or right or any other provision or right of this Agreement. The waiver, whether express or implied, by either party

   

   

  

  of a violation of any of the provisions of this Agreement shall not operate or be construed as a waiver of any subsequent violation of any such provision.

   

  15.280G. Notwithstanding any other provision of this Agreement, or any other agreement, plan, or arrangement to the contrary, if any portion of any payment or benefit to Employee under this Agreement, or under any other agreement, plan, or arrangement (in the aggregate, “Total Payments”), would constitute an “excess parachute payment” under Section 280G of the Code, and would, but for this Section 15, result in the imposition on Employee of an excise tax (the “Excise Tax”) under Section 4999 of the Internal Revenue Code (the “Code”), then the Total Payments to be made to the Employee shall either be (a) delivered in full, or (b) delivered in a reduced amount that is $1.00 less than the amount that would cause any portion of such Total Payments to be subject to the Excise Tax, whichever of the foregoing results in the receipt by the Employee of the greatest benefit on an after-tax basis (taking into account the Excise Tax, as well as the applicable federal, state, and local income and employment taxes, for which the Employee shall be deemed to pay at the highest marginal rate for the applicable calendar year). To the extent the foregoing reduction applies, then any such payment or benefit shall be reduced or eliminated by applying the following principles, in order: (1) the payment or benefit with the higher ratio of the parachute payment value to present economic value (determined using reasonable actuarial assumptions) shall be reduced or eliminated before a payment or benefit with a lower ratio; (2) the payment or benefit with the later possible payment date shall be reduced or eliminated before a payment or benefit with an earlier payment date; and (3) cash payments shall be reduced prior to non-cash benefits; provided that if the foregoing order of reduction or elimination would violate Section 409A of the Code, then the reduction shall be made pro rata among the payment or benefits (on the basis of the relative present value of the parachute payments). The determination of whether the Excise Tax or the foregoing reduction will apply will be made by independent tax counsel selected and paid by the Company (which may be regular counsel of the Company).

   

  16.SURVIVAL. Any provision of this Agreement that is expressly or by implication intended to survive the termination of this Agreement shall survive or remain in effect after the termination of this Agreement.

   

  17.COUNTERPARTS. This Agreement may be executed in separate counterparts, either one of which need not contain the signature of more than one party, but both such counterparts taken together shall constitute one and the same agreement. Counterparts may be delivered via facsimile, electronic mail (including .pdf or any electronic signature complying with the U.S. federal ESIGN Act of 2000, e.g., www.docusign.com) or other transmission method and any counterpart so delivered shall be deemed to have been duly and validly delivered and be valid and effective for all purposes.

   

  18.UNDERSTANDING OF EMPLOYEE. Employee agrees and acknowledges that Employee has read this Agreement in its entirety, that Employee understands it and that Employee has entered into it voluntarily.

   

  [signatures follow]

   

  IN WITNESS WHEREOF, the parties intending to be legally bound have executed this Agreement as of the date first set forth above.

   

   

  

  GENERATION INCOME PROPERTIES, INC.

   

  By: /s/ Allison Davies

  	Allison Davies, Chief Financial Officer

   

   

  EMPLOYEE

   

   

  By: /s/ David Sobelman

  David Sobelman, individually

   

   

  

  EXHIBIT A FORM OF RELEASE

  This RELEASE (“Release”) is granted effective as of the [•] day of [•], 20[•] by David Sobelman (the “Employee”) in favor of Generation Income Properties, Inc., a Maryland corporation (the “Company”), and the other Released Parties (as defined below). This is the Release referred to in the Amended and Restated Employment Agreement, dated as of 	, 2022, between the Company and the Employee (the “Employment Agreement”). The Employee gives this Release in consideration of the Company’s promises and covenants contained in the Employment Agreement, with respect to which this Release is an integral part.

  1.Release of the Company. The Employee, for himself, his successors, assigns, attorneys, and all those entitled to assert his rights, now and forever hereby releases and discharges the Company and its respective officers, directors, stockholders, trustees, Employee’s, agents, parent corporations, subsidiaries, affiliates, estates, successors, assigns and attorneys (the “Released Parties”), from any and all claims, actions, causes of action, sums of money due, suits, debts, liens, covenants, contracts, obligations, costs, expenses, damages, judgments, agreements, promises, demands, claims for attorney’s fees and costs, or liabilities whatsoever, in law or in equity, which the Employee ever had or now has against the Released Parties, arising by reason of or in any way connected with or which may be traced either directly or indirectly to the employment relationship which existed between the Company or any of its parents, subsidiaries, affiliates, or predecessors and the Employee, or the termination of that relationship, that the Employee has, had or purports to have, from the beginning of time to the date of this Release, whether known or unknown, that now exists, no matter how remotely they may be related to the aforesaid employment relationship including but not limited to claims for employment discrimination under federal or state law, except as provided in Paragraph 2; claims arising under Title VII of the Civil Rights Act, 42 U.S.C. § 2000(e), et seq. or the Americans With Disabilities Act, 42 U.S.C. § 12101, et seq.; claims for statutory or common law wrongful discharge, including any claims arising under the Fair Labor Standards Act, 29

  U.S.C. § 201, et seq.; claims for attorney’s fees, expenses and costs; claims for defamation; claims for wages or vacation pay; claims for benefits, including any claims arising under the Employee Retirement Income Security Act, 29 U.S.C. § 1001, et seq.; and provided, however, that nothing herein shall release the Company of its obligations to the Employee under Section 3(b) of the Employment Agreement or under any equity award agreement or indemnification agreement, or under any indemnification obligations to the Employee under the Company’s articles of incorporation or bylaws or any federal, state or local law or otherwise.

   

  2.Release of Claims Under Age Discrimination in Employment Act. Without limiting the 

   

  

  generality of the foregoing, the Employee agrees that by executing this Release, he has released

   

   

  

  and waived any and all claims he has or may have as of the date of this Release for age discrimination under the Age Discrimination in Employment Act, 29 U.S.C. § 621, et seq. It is understood that the Employee has been advised to consult with an attorney prior to executing this Release; that he in fact has consulted a knowledgeable, competent attorney regarding this Release; that he may, before executing this Release, consider this Release for a period of 21 calendar days; and that the consideration he receives for this Release is in addition to amounts to which he was already entitled. It is further understood that this Release is not effective until seven calendar days after the execution of this Release and that the Employee may revoke this Release within seven calendar days from the date of execution hereof.

   

  The Employee agrees that he has carefully read this Release and is signing it voluntarily. The Employee acknowledges that he has had 21 days from receipt of this Release to review it prior to signing or that, if the Employee is signing this Release prior to the expiration of such 21-day period, the Employee is waiving his right to review the Release for such full 21-day period prior to signing it. The Employee has the right to revoke this release within seven days following the date of its execution by him. However, if the Employee revokes this Release within such seven- day period, no severance benefit will be payable to him under the Employment Agreement and he shall return to the Company any such payment received prior to that date.

  THE EMPLOYEE HAS CAREFULLY READ THIS RELEASE AND ACKNOWLEDGES THAT IT CONSTITUTES A GENERAL RELEASE OF ALL KNOWN AND UNKNOWN CLAIMS AGAINST THE COMPANY UNDER THE AGE DISCRIMINATION IN EMPLOYMENT ACT. THE EMPLOYEE ACKNOWLEDGES THAT HE HAS HAD A FULL OPPORTUNITY TO CONSULT WITH AN ATTORNEY OR OTHER ADVISOR OF HIS CHOOSING CONCERNING HIS EXECUTION OF THIS RELEASE AND THAT HE IS SIGNING THIS RELEASE VOLUNTARILY AND WITH THE FULL INTENT OF RELEASING THE COMPANY FROM ALL SUCH CLAIMS.

   

   

  David Sobelman Date: [•], 20[•]Exhibit 4.1

 

DIGITAL BRANDS GROUP, INC.

 

REGISTRATION RIGHTS AGREEMENT

(SUNDRY)

 

This Registration Rights Agreement
(this “Agreement”) is made and entered into as of December 30, 2022, between Digital Brands Group, Inc.,
a Delaware corporation (the “Company”), and each of the several and the holder(s) of the Company’s securities
set forth on the signature pages hereof (each such holder, an “Holder” and, collectively, the “Holders”).

 

This
Agreement is made pursuant to that Second Amended and Restated Membership Interest Purchase Agreement dated October 13, 2022
by and among the Holders as Sellers, Sunnyside, LLC., the Company, and George Levy, as Sellers’ Representative
(as may be amended from time to time, the “MPA”). Each of the Holders was issued Registrable Securities further to
the MPA.

 

The Company and each Holder
hereby agrees as follows:

 

1.             Definitions.

 

Capitalized terms used and
not otherwise defined herein that are defined in the MPA shall have the meanings given such terms in the MPA. As used in this Agreement,
the following terms shall have the following meanings:

 

“Advice”
shall have the meaning set forth in Section 6(b).

 

“Common
Stock” means the common stock of the Company, par value $0.0001 per share.

 

“Effectiveness
Period” shall have the meaning set forth in Section 2(a).

 

“Indemnified
Party” shall have the meaning set forth in Section 5(c).

 

“Indemnifying
Party” shall have the meaning set forth in Section 5(c).

 

“Initial
Registration Statement” means the initial Registration Statement filed pursuant to Section 2 of this Agreement.

 

“Plan of
Distribution” shall have the meaning set forth in Section 2(a).

 

“Prospectus”
means the prospectus included in a Registration Statement (including, without limitation, a prospectus that includes any information previously
omitted from a prospectus filed as part of an effective registration statement in reliance upon Rule 430A promulgated by the Commission
pursuant to the Securities Act), as amended or supplemented by any prospectus supplement, with respect to the terms of the offering of
any portion of the Registrable Securities covered by a Registration Statement, and all other amendments and supplements to the Prospectus,
including post-effective amendments, and all material incorporated by reference or deemed to be incorporated by reference in such Prospectus.

 

“Registrable
Securities” means, as of any date of determination, (a) the shares of Common Stock issued or issuable to the Holders pursuant
to the terms and conditions of the MPA and (b) any securities issued or then issuable upon any share split, dividend or other distribution,
recapitalization or similar event with respect to the foregoing; provided, however, that any such Registrable Securities shall cease
to be Registrable Securities (and the Company shall not be required to maintain the effectiveness of any, or file another, Registration
Statement hereunder with respect thereto) for so long as (i) a Registration Statement with respect to the sale of such Registrable
Securities is declared effective by the Commission under the Securities Act and such Registrable Securities have been disposed of by the
Holder in accordance with such effective Registration Statement, (ii) such Registrable Securities have been previously sold in accordance
with Rule 144, or (iii) such securities become eligible for resale without volume or manner-of-sale restrictions and without
current public information pursuant to Rule 144 as set forth in a written opinion letter to such effect, addressed, delivered and
acceptable to the Transfer Agent and the affected Holders (assuming that such securities and any securities issuable upon exercise, conversion
or exchange of which, or as a dividend upon which, such securities were issued or are issuable, were at no time held by any Affiliate
of the Company, as reasonably determined by the Company, upon the advice of counsel to the Company.

 

    1

    

    

 

“Registration
Statement” means any registration statement required to be filed hereunder pursuant to Section 2(a), and any additional
registration statements contemplated by Section 3(b) including (in each case) the Prospectus, amendments and supplements to
any such registration statement or Prospectus, including pre- and post-effective amendments, all exhibits thereto, and all material incorporated
by reference or deemed to be incorporated by reference in any such registration statement.

 

“Rule 415”
means Rule 415 promulgated by the Commission pursuant to the Securities Act, as such Rule may be amended or interpreted from
time to time, or any similar rule or regulation hereafter adopted by the Commission having substantially the same purpose and effect
as such Rule.

 

“Rule 424”
means Rule 424 promulgated by the Commission pursuant to the Securities Act, as such Rule may be amended or interpreted from
time to time, or any similar rule or regulation hereafter adopted by the Commission having substantially the same purpose and effect
as such Rule.

 

“Selling
Securityholder Questionnaire” shall have the meaning set forth in Section 2(a).

 

“SEC Guidance”
means (i) any publicly-available written or oral guidance of the Commission staff, or any comments, requirements or requests of the
Commission staff and (ii) the Securities Act.

 

“Transfer
Agent” means Continental Stock Transfer & Trust Company.

 

2.             Registration.

 

(a) The Company
shall use its reasonable best efforts within fifteen (15) days after the Closing (as defined in the MPA), but in no event later than thirty
(30) days after the Closing, to prepare and file with the Commission a Registration Statement covering the resale of 100% of the Registrable
Securities for an offering to be made on a continuous basis pursuant to Rule 415. Each Registration Statement filed hereunder shall
be on Form S-1 (except if the Company is not then eligible to register for resale the Registrable Securities on Form S-1, in
which case such registration shall be on another appropriate form in accordance herewith) and shall contain substantially the “Plan
of Distribution” attached hereto as Annex A and substantially the “Selling Securityholder”
section attached hereto as Annex B; provided, however, that no Holder shall be required to be named as an “underwriter”
without such Holder’s express prior written consent. Subject to the terms of this Agreement, the Company shall use its best efforts
to cause a Registration Statement filed under this Agreement to be declared effective under the Securities Act as promptly as possible
after the filing thereof, and shall use its best efforts to keep such Registration Statement continuously effective under the Securities
Act until the date that all Registrable Securities covered by such Registration Statement (i) have been sold, thereunder or pursuant
to Rule 144, or (ii) may be sold without volume or manner-of-sale restrictions pursuant to Rule 144 and without the requirement
for the Company to be in compliance with the current public information requirement under Rule 144, as determined by the counsel
to the Company pursuant to a written opinion letter to such effect, addressed and acceptable to the Transfer Agent and the affected Holders
(the “Effectiveness Period”). The Company shall telephonically request effectiveness of a Registration Statement as
of 5:00 p.m. (New York City time) on a Trading Day. The Company shall immediately notify the Holders by e-mail of the effectiveness
of a Registration Statement on the same Trading Day that the Company telephonically confirms effectiveness with the Commission, which
shall be the date requested for effectiveness of such Registration Statement. The Company shall, by 9:30 a.m. (New York City time)
on the Trading Day after the effective date of such Registration Statement, file a final Prospectus with the Commission as required by
Rule 424.

 

    2

    

    

 

(b) Notwithstanding
the registration obligations set forth in Section 2(a), if the Commission informs the Company that all of the Registrable Securities
cannot, as a result of the application of Rule 415, be registered for resale as a secondary offering on a single registration statement,
the Company agrees to promptly inform each of the Holders thereof and use its commercially reasonable efforts to file amendments to the
Initial Registration Statement as required by the Commission, covering the maximum number of Registrable Securities permitted to be registered
by the Commission, on Form S-1 or such other form available to register for resale the Registrable Securities as a secondary offering,
subject to the provisions of Section 2(e); with respect to filing on Form S-1 or other appropriate form; provided, however,
that prior to filing such amendment, the Company shall be obligated to use diligent efforts to advocate with the Commission for the registration
of all of the Registrable Securities in accordance with the SEC Guidance, including without limitation, Compliance and Disclosure Interpretation
612.09.

 

(c)  If Form S-1
is not available for the registration of the resale of Registrable Securities hereunder, the Company shall register the resale of the
Registrable Securities on another appropriate form.

 

3.             Registration Procedures.

 

In connection with the Company’s
registration obligations hereunder, the Company shall:

 

(a)  Not less
than five (5) Trading Days prior to the filing of each Registration Statement and not less than one (1) Trading Day prior to
the filing of any related Prospectus or any amendment or supplement thereto (including any document that would be incorporated or deemed
to be incorporated therein by reference), the Company shall (i) furnish to each Holder copies of all such documents proposed to be
filed, which documents (other than those incorporated or deemed to be incorporated by reference) will be subject to the review of such
Holders, and (ii) cause its officers and directors, counsel and independent registered public accountants to respond to such inquiries
as shall be necessary, in the reasonable opinion of respective counsel to each Holder, to conduct a reasonable investigation within the
meaning of the Securities Act. The Company shall not file a Registration Statement or any such Prospectus or any amendments or supplements
thereto to which the Holders of a majority of the Registrable Securities shall reasonably object in good faith, provided that, the Company
is notified of such objection in writing no later than five (5) Trading Days after the Holders have been so furnished copies of a
Registration Statement or one (1) Trading Day after the Holders have been so furnished copies of any related Prospectus or amendments
or supplements thereto. Each Holder agrees to furnish to the Company a completed questionnaire in the form attached to this Agreement
as Annex C (a “Selling Securityholder Questionnaire”) on a date that is not less than two (2) Trading
Days prior to the Filing Date or by the end of the fourth (4th) Trading Day following the date on which such Holder receives
draft materials in accordance with this Section.

 

    3

    

    

 

(b)  (i) Prepare
and file with the Commission such amendments, including post-effective amendments, to a Registration Statement and the Prospectus used
in connection therewith as may be necessary to keep a Registration Statement continuously effective as to the applicable Registrable Securities
for the Effectiveness Period and prepare and file with the Commission such additional Registration Statements in order to register for
resale under the Securities Act all of the Registrable Securities, (ii) cause the related Prospectus to be amended or supplemented
by any required Prospectus supplement (subject to the terms of this Agreement), and, as so supplemented or amended, to be filed pursuant
to Rule 424, (iii) respond as promptly as reasonably possible to any comments received from the Commission with respect to a
Registration Statement or any amendment thereto and provide as promptly as reasonably possible to the Holders true and complete copies
of all correspondence from and to the Commission relating to a Registration Statement (provided that, the Company shall excise any information
contained therein which would constitute material non-public information regarding the Company or any of its Subsidiaries), and (iv) comply
in all material respects with the applicable provisions of the Securities Act and the Exchange Act with respect to the disposition of
all Registrable Securities covered by a Registration Statement during the applicable period in accordance (subject to the terms of this
Agreement) with the intended methods of disposition by the Holders thereof set forth in such Registration Statement as so amended or in
such Prospectus as so supplemented.

 

(c)  Notify the
Holders of Registrable Securities to be sold (which notice shall, pursuant to clauses (iii) through (vi) hereof, be accompanied
by an instruction to suspend the use of the Prospectus until the requisite changes have been made) as promptly as reasonably possible
(and, in the case of (i)(A) below, not less than one (1) Trading Day prior to such filing) and (if requested by any such Person)
confirm such notice in writing no later than one (1) Trading Day following the day (i)(A) when a Prospectus or any Prospectus
supplement or post-effective amendment to a Registration Statement is proposed to be filed, (B) when the Commission notifies the
Company whether there will be a “review” of such Registration Statement and whenever the Commission comments in writing on
such Registration Statement, and (C) with respect to a Registration Statement or any post-effective amendment, when the same has
become effective, (ii) of any request by the Commission or any other federal or state governmental authority for amendments or supplements
to a Registration Statement or Prospectus or for additional information, (iii) of the issuance by the Commission or any other federal
or state governmental authority of any stop order suspending the effectiveness of a Registration Statement covering any or all of the
Registrable Securities or the initiation of any Proceedings for that purpose, (iv) of the receipt by the Company of any notification
with respect to the suspension of the qualification or exemption from qualification of any of the Registrable Securities for sale in any
jurisdiction, or the initiation or threatening of any Proceeding for such purpose, (v) of the occurrence of any event or passage
of time that makes the financial statements included in a Registration Statement ineligible for inclusion therein or any statement made
in a Registration Statement or Prospectus or any document incorporated or deemed to be incorporated therein by reference untrue in any
material respect or that requires any revisions to a Registration Statement, Prospectus or other documents so that, in the case of a Registration
Statement or the Prospectus, as the case may be, it will not contain any untrue statement of a material fact or omit to state any material
fact required to be stated therein or necessary to make the statements therein, in light of the circumstances under which they were made,
not misleading, and (vi) of the occurrence or existence of any pending corporate development with respect to the Company that the
Company believes may be material and that, in the determination of the Board of Directors of the Company in good faith, makes it not in
the best interest of the Company to allow continued availability of a Registration Statement or Prospectus; provided, however,
that in no event shall any such notice contain any information which would constitute material, non-public information regarding the Company
or any of its Subsidiaries.

 

    4

    

    

 

(d)  Use its
best efforts to avoid the issuance of, or, if issued, obtain the withdrawal of (i) any order stopping or suspending the effectiveness
of a Registration Statement, or (ii) any suspension of the qualification (or exemption from qualification) of any of the Registrable
Securities for sale in any jurisdiction, at the earliest practicable moment.

 

(e)  Furnish
to each Holder, without charge, at least one conformed copy of each such Registration Statement and each amendment thereto, including
financial statements and schedules, all documents incorporated or deemed to be incorporated therein by reference to the extent requested
by such Person, and all exhibits to the extent requested by such Person (including those previously furnished or incorporated by reference)
promptly after the filing of such documents with the Commission, provided that any such item which is available on the EDGAR system (or
successor thereto) need not be furnished in physical form.

 

(f)  Subject
to the terms of this Agreement, the Company hereby consents to the use of such Prospectus and each amendment or supplement thereto by
each of the selling Holders in connection with the offering and sale of the Registrable Securities covered by such Prospectus and any
amendment or supplement thereto, except after the giving of any notice pursuant to Section 2(d).

 

(g)  Prior to
any resale of Registrable Securities by a Holder, use its commercially reasonable efforts to register or qualify or cooperate with the
selling Holders in connection with the registration or qualification (or exemption from the Registration or qualification) of such Registrable
Securities for the resale by the Holder under the securities or Blue Sky laws of such jurisdictions within the United States as any Holder
reasonably requests in writing, to keep each registration or qualification (or exemption therefrom) effective during the Effectiveness
Period and to do any and all other acts or things reasonably necessary to enable the disposition in such jurisdictions of the Registrable
Securities covered by each Registration Statement, provided that the Company shall not be required to qualify generally to do business
in any jurisdiction where it is not then so qualified, subject the Company to any material tax in any such jurisdiction where it is not
then so subject or file a general consent to service of process in any such jurisdiction.

 

(h)  If requested
by a Holder, cooperate with such Holder to facilitate the timely preparation and delivery of certificates representing Registrable Securities
to be delivered to a transferee pursuant to a Registration Statement, which certificates shall be free, to the extent permitted by the
MPA, of all restrictive legends, and to enable such Registrable Securities to be in such denominations and registered in such names as
any such Holder may request.

 

(i)  Upon the
occurrence of any event contemplated by Section 3(c), as promptly as reasonably possible under the circumstances taking into account
the Company’s good faith assessment of any adverse consequences to the Company and its shareholders of the premature disclosure
of such event, prepare a supplement or amendment, including a post-effective amendment, to a Registration Statement or a supplement to
the related Prospectus or any document incorporated or deemed to be incorporated therein by reference, and file any other required document
so that, as thereafter delivered, neither a Registration Statement nor such Prospectus will contain an untrue statement of a material
fact or omit to state a material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances
under which they were made, not misleading. If the Company notifies the Holders in accordance with clauses (iii) through (vi) of
Section 3(c) above to suspend the use of any Prospectus until the requisite changes to such Prospectus have been made, then
the Holders shall suspend use of such Prospectus. The Company will use its best efforts to ensure that the use of the Prospectus may be
resumed as promptly as is practicable. The Company shall be entitled to exercise its right under this Section 3(i) to suspend
the availability of a Registration Statement and Prospectus for a period not to exceed 60 calendar days (which need not be consecutive
days) in any 12-month period.

 

    5

    

    

 

(j)  Otherwise
use commercially reasonable efforts to comply with all applicable rules and regulations of the Commission under the Securities Act
and the Exchange Act, including, without limitation, Rule 172 under the Securities Act, file any final Prospectus, including any
supplement or amendment thereof, with the Commission pursuant to Rule 424 under the Securities Act, promptly inform the Holders in
writing if, at any time during the Effectiveness Period, the Company does not satisfy the conditions specified in Rule 172 and, as
a result thereof, the Holders are required to deliver a Prospectus in connection with any disposition of Registrable Securities and take
such other actions as may be reasonably necessary to facilitate the registration of the Registrable Securities hereunder.

 

(k)  The Company
may require each selling Holder to furnish to the Company a certified statement as to the number of shares of Common Stock beneficially
owned by such Holder and, if required by the Commission, the natural persons thereof that have voting and dispositive control over the
shares.

 

4.             Registration Expenses.
All fees and expenses incident to the performance of or compliance with, this Agreement by the Company shall be borne by the Company whether
or not any Registrable Securities are sold pursuant to a Registration Statement. The fees and expenses referred to in the foregoing sentence
shall include, without limitation, (i) all registration and filing fees (including, without limitation, fees and expenses of the
Company’s counsel and independent registered public accountants) (A) with respect to filings made with the Commission, (B) with
respect to filings required to be made with any Trading Market on which the shares of Common Stock are then listed for trading, and (C) in
compliance with applicable state securities or Blue Sky laws (including, without limitation, fees and disbursements of counsel for the
Company in connection with Blue Sky qualifications or exemptions of the Registrable Securities), (ii) printing expenses (including,
without limitation, expenses of printing certificates for Registrable Securities), (iii) messenger, telephone and delivery expenses,
(iv) fees and disbursements of counsel for the Company, (v) Securities Act liability insurance, if the Company so desires such
insurance, and (vi) fees and expenses of all other Persons retained by the Company in connection with the consummation of the transactions
contemplated by this Agreement. In addition, the Company shall be responsible for all of its internal expenses incurred in connection
with the consummation of the transactions contemplated by this Agreement (including, without limitation, all salaries and expenses of
its officers and employees performing legal or accounting duties), the expense of any annual audit and the fees and expenses incurred
in connection with the listing of the Registrable Securities on any securities exchange as required hereunder. In no event shall the Company
be responsible for any broker or similar commissions of any Holder or, except to the extent provided for in the Transaction Documents,
any legal fees or other costs of the Holders.

 

    6

    

    

 

5.             Indemnification.

 

(a)  Indemnification
by the Company. The Company shall, notwithstanding any termination of this Agreement, indemnify and hold harmless each Holder, the
officers, directors, members, partners, agents, brokers (including brokers who offer and sell Registrable Securities as principal as a
result of a pledge or any failure to perform under a margin call), investment advisors and employees (and any other Persons with a functionally
equivalent role of a Person holding such titles, notwithstanding a lack of such title or any other title) of each of them, each Person
who controls any such Holder (within the meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act) and
the officers, directors, members, shareholders, partners, agents and employees (and any other Persons with a functionally equivalent role
of a Person holding such titles, notwithstanding a lack of such title or any other title) of each such controlling Person, to the fullest
extent permitted by applicable law, from and against any and all losses, claims, damages, liabilities, costs (including, without limitation,
reasonable attorneys’ fees) and expenses (collectively, “Losses”), incurred, arising out of or relating to (1) any
untrue or alleged untrue statement of a material fact contained in a Registration Statement, any Prospectus 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 supplement
thereto, in light of the circumstances under which they were made) not misleading or (2) any violation or alleged violation by the
Company or its directors, officers, agents and employees, of the Securities Act, the Exchange Act or any state securities law, or any
rule or regulation thereunder, in connection with the performance of its obligations under this Agreement, except to the extent,
but only to the extent, that (i) such untrue statements or omissions are based solely upon information regarding such Holder furnished
in writing to the Company by such Holder expressly for use therein, or to the extent that such information relates to such Holder or such
Holder’s proposed method of distribution of Registrable Securities and was reviewed and expressly approved in writing by such Holder
expressly for use in a Registration Statement, such Prospectus or in any amendment or supplement thereto (it being understood that the
Holder has approved Annex A hereto for this purpose) or (ii) in the case of an occurrence of an event of the type specified
in Section 2(c)(iii)-(vi), the use by such Holder of an outdated, defective or otherwise unavailable Prospectus after the Company
has notified such Holder in writing that the Prospectus is outdated, defective or otherwise unavailable for use by such Holder and prior
to the receipt by such Holder of the Advice contemplated in Section 6(b). The Company shall notify the Holders promptly of the institution,
threat or assertion of any Proceeding arising from or in connection with the transactions contemplated by this Agreement of which the
Company is aware. Such indemnity shall remain in full force and effect regardless of any investigation made by or on behalf of such indemnified
person and shall survive the transfer of any Registrable Securities by any of the Holders.

 

(b)  Indemnification
by Holders. Each Holder shall, severally and not jointly, indemnify and hold harmless the Company, its directors, officers, agents
and employees, each Person who controls the Company (within the meaning of Section 15 of the Securities Act and Section 20 of
the Exchange Act), and the directors, officers, agents or employees of such controlling Persons, to the fullest extent permitted by applicable
law, from and against all Losses, as incurred, to the extent arising out of or based solely upon any untrue or alleged untrue statement
of a material fact contained in any Registration Statement, any 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 supplement thereto, in light of the circumstances under which they were
made) not misleading (i) to the extent, but only to the extent, that such untrue statement or omission is contained in any information
so furnished in writing by such Holder to the Company expressly for inclusion in such Registration Statement or such Prospectus or (ii) to
the extent, but only to the extent, that such information relates to such Holder’s information provided in the Selling Securityholder
Questionnaire or the proposed method of distribution of Registrable Securities and was reviewed and expressly approved in writing by such
Holder expressly for use in a Registration Statement (it being understood that the Holder has approved Annex A hereto for this purpose),
such Prospectus or in any amendment or supplement thereto. In no event shall the liability of a selling Holder be greater in amount than
the dollar amount of the proceeds (net of all expenses paid by such Holder in connection with any claim relating to this Section 5
and the amount of any damages such Holder has otherwise been required to pay by reason of such untrue statement or omission) received
by such Holder upon the sale of the Registrable Securities included in the Registration Statement giving rise to such indemnification
obligation.

 

    7

    

    

 

(c)  Conduct
of Indemnification Proceedings. If any Proceeding shall be brought or asserted against any Person entitled to indemnity hereunder
(an “Indemnified Party”), such Indemnified Party shall promptly notify the Person from whom indemnity is sought (the
 “Indemnifying Party”) in writing, and the Indemnifying Party shall have the right to assume the defense thereof, including
the employment of counsel reasonably satisfactory to the Indemnified Party and the payment of all fees and expenses incurred in connection
with defense thereof, provided that the failure of any Indemnified Party to give such notice shall not relieve the Indemnifying Party
of its obligations or liabilities pursuant to this Agreement, except (and only) to the extent that it shall be finally determined by a
court of competent jurisdiction (which determination is not subject to appeal or further review) that such failure shall have materially
and adversely prejudiced the Indemnifying Party.

 

An Indemnified Party
shall have the right to employ separate counsel in any such Proceeding and to participate in the defense thereof, but the fees and expenses
of such counsel shall be at the expense of such Indemnified Party or Parties unless: (1) the Indemnifying Party has agreed in writing
to pay such fees and expenses, (2) the Indemnifying Party shall have failed promptly to assume the defense of such Proceeding and
to employ counsel reasonably satisfactory to such Indemnified Party in any such Proceeding, or (3) the named parties to any such
Proceeding (including any impleaded parties) include both such Indemnified Party and the Indemnifying Party, and counsel to the Indemnified
Party shall reasonably believe that a material conflict of interest is likely to exist if the same counsel were to represent such Indemnified
Party and the Indemnifying Party (in which case, if such Indemnified Party notifies the Indemnifying Party in writing that it elects to
employ separate counsel at the expense of the Indemnifying Party, the Indemnifying Party shall not have the right to assume the defense
thereof and the reasonable fees and expenses of no more than one separate counsel shall be at the expense of the Indemnifying Party).
The Indemnifying Party shall not be liable for any settlement of any such Proceeding effected without its written consent, which consent
shall not be unreasonably withheld or delayed. No Indemnifying Party shall, without the prior written consent of the Indemnified Party,
effect any settlement of any pending Proceeding in respect of which any Indemnified Party is a party, unless such settlement includes
an unconditional release of such Indemnified Party from all liability on claims that are the subject matter of such Proceeding.

 

Subject to the terms
of this Agreement, all reasonable fees and expenses of the Indemnified Party (including reasonable fees and expenses to the extent incurred
in connection with investigating or preparing to defend such Proceeding in a manner not inconsistent with this Section) shall be paid
to the Indemnified Party, as incurred, within ten (10) Trading Days of written notice thereof to the Indemnifying Party, provided
that the Indemnified Party shall promptly reimburse the Indemnifying Party for that portion of such fees and expenses applicable to such
actions for which such Indemnified Party is finally determined by a court of competent jurisdiction (which determination is not subject
to appeal or further review) not to be entitled to indemnification hereunder.

 

    8

    

    

 

(d)  Contribution.
If the indemnification under Section 5(a) or 5(b) is unavailable to an Indemnified Party or insufficient to hold an Indemnified
Party harmless for any Losses, then each Indemnifying Party shall contribute to the amount paid or payable by such Indemnified Party,
in such proportion as is appropriate to reflect the relative fault of the Indemnifying Party and Indemnified Party in connection with
the actions, statements or omissions that resulted in such Losses as well as any other relevant equitable considerations. The relative
fault of such 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 of a material fact, has
been taken or made by, or relates to information supplied by, such Indemnifying Party or Indemnified Party, and the parties’ relative
intent, knowledge, access to information and opportunity to correct or prevent such action, statement or omission. The amount paid or
payable by a party as a result of any Losses shall be deemed to include, subject to the limitations set forth in this Agreement, any reasonable
attorneys’ or other fees or expenses incurred by such party in connection with any Proceeding to the extent such party would have
been indemnified for such fees or expenses if the indemnification provided for in this Section was available to such party in accordance
with its terms.

 

The parties hereto
agree that it would not be just and equitable if contribution pursuant to this Section 5(d) were determined by pro rata allocation
or by any other method of allocation that does not take into account the equitable considerations referred to in the immediately preceding
paragraph. In no event shall the contribution obligation of a Holder of Registrable Securities be greater in amount than the dollar amount
of the proceeds (net of all expenses paid by such Holder in connection with any claim relating to this Section 5 and the amount of
any damages such Holder has otherwise been required to pay by reason of such untrue or alleged untrue statement or omission or alleged
omission) received by it upon the sale of the Registrable Securities giving rise to such contribution obligation.

 

The indemnity and
contribution agreements contained in this Section are in addition to any liability that the Indemnifying Parties may have to the
Indemnified Parties.

 

6.             Miscellaneous.

 

(a)  Remedies.
In the event of a breach by the Company or by a Holder of any of their respective obligations under this Agreement, each Holder or the
Company, as the case may be, in addition to being entitled to exercise all rights granted by law and under this Agreement, including recovery
of damages, shall be entitled to specific performance of its rights under this Agreement. Each of the Company and each Holder agrees that
monetary damages would not provide adequate compensation for any losses incurred by reason of a breach by it of any of the provisions
of this Agreement and hereby further agrees that, in the event of any action for specific performance in respect of such breach, it shall
not assert or shall waive the defense that a remedy at law would be adequate.

 

(b)  Discontinued
Disposition. By its acquisition of Registrable Securities, each Holder agrees that, upon receipt of a notice from the Company of the
occurrence of any event of the kind described in Section 3(c)(iii) through (vi), such Holder will forthwith discontinue disposition
of such Registrable Securities under a Registration Statement until it is advised in writing (the “Advice”) by the
Company that the use of the applicable Prospectus (as it may have been supplemented or amended) may be resumed. The Company will use its
best efforts to ensure that the use of the Prospectus may be resumed as promptly as is practicable.

 

    9

    

    

 

(c)  Amendments
and Waivers. The provisions of this Agreement, including the provisions of this sentence, may not be amended, modified or supplemented,
and waivers or consents to departures from the provisions hereof may not be given, unless the same shall be in writing and signed by the
Company and the Holders of 50.1% or more of the then outstanding Registrable Securities (for purposes of clarification, this includes
any Registrable Securities issuable upon exercise or conversion of any security), provided that, if any amendment, modification or waiver
disproportionately and adversely impacts a Holder (or group of Holders), the consent of such disproportionately impacted Holder (or group
of Holders) shall be required. If a Registration Statement does not register all of the Registrable Securities pursuant to a waiver or
amendment done in compliance with the previous sentence, then the number of Registrable Securities to be registered for each Holder shall
be reduced pro rata among all Holders and each Holder shall have the right to designate which of its Registrable Securities shall be omitted
from such Registration Statement. Notwithstanding the foregoing, a waiver or consent to depart from the provisions hereof with respect
to a matter that relates exclusively to the rights of a Holder or some Holders and that does not directly or indirectly affect the rights
of other Holders may be given only by such Holder or Holders of all of the Registrable Securities to which such waiver or consent relates; provided, however,
that the provisions of this sentence may not be amended, modified, or supplemented except in accordance with the provisions of the first
sentence of this Section 5(d). No consideration shall be offered or paid to any Person to amend or consent to a waiver or modification
of any provision of this Agreement unless the same consideration also is offered to all of the parties to this Agreement.

 

(d)  Notices.
Any and all notices or other communications or deliveries required or permitted to be provided hereunder shall be delivered as set forth
in the MPA.

 

(e)  Successors
and Assigns. This Agreement shall inure to the benefit of and be binding upon the successors and permitted assigns of each of the
parties and shall inure to the benefit of each Holder. The Company may not assign (except by merger) its rights or obligations hereunder
without the prior written consent of all of the Holders of the then outstanding Registrable Securities.

 

(f)  No Inconsistent
Agreements. Neither the Company nor any of its Subsidiaries has entered, as of the date hereof, nor shall the Company or any of its
Subsidiaries, on or after the date of this Agreement, enter into any agreement with respect to its securities, that would have the effect
of impairing the rights granted to the Holders in this Agreement or otherwise conflicts with the provisions hereof.

 

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

 

    10

    

    

 

(h) Governing
Law. All questions concerning the construction, validity, enforcement and interpretation of this Agreement shall be determined in
accordance with the provisions of the MPA.

 

(i)  Cumulative
Remedies. The remedies provided herein are cumulative and not exclusive of any other remedies provided by law.

 

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

 

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

 

(l)  Independent
Nature of Holders’ Obligations and Rights. The obligations of each Holder hereunder are several and not joint with the obligations
of any other Holder hereunder, and no Holder shall be responsible in any way for the performance of the obligations of any other Holder
hereunder. Nothing contained herein or in any other agreement or document delivered at any closing, and no action taken by any Holder
pursuant hereto or thereto, shall be deemed to constitute the Holders as a partnership, an association, a joint venture or any other kind
of group or entity, or create a presumption that the Holders are in any way acting in concert or as a group or entity with respect to
such obligations or the transactions contemplated by this Agreement or any other matters, and the Company acknowledges that the Holders
are not acting in concert or as a group, and the Company shall not assert any such claim, with respect to such obligations or transactions.
Each Holder shall be entitled to protect and enforce its rights, including without limitation the rights arising out of this Agreement,
and it shall not be necessary for any other Holder to be joined as an additional party in any proceeding for such purpose. The use of
a single agreement with respect to the obligations of the Company contained was solely in the control of the Company, not the action or
decision of any Holder, and was done solely for the convenience of the Company and not because it was required or requested to do so by
any Holder. It is expressly understood and agreed that each provision contained in this Agreement is between the Company and a Holder,
solely, and not between the Company and the Holders collectively and not between and among Holders.

 

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

 

(Signature Pages Follow)

 

    11

    

    

 

IN
WITNESS WHEREOF, the parties have executed this Registration Rights Agreement as of the date first written above.

 

	 	DIGITAL BRANDS GROUP, INC.
	 	 
	 	   	 
	 	By:	/s/
John Hilburn Davis IV
	 	Name:	 John Hilburn Davis IV
	 	Title:	 President and Chief Executive Officer

 

[SIGNATURE PAGE OF HOLDERS FOLLOWS]

 

    12

    

    

 

[SIGNATURE PAGE OF HOLDERS]

 

	Name of Holder: 	Moise Emquies	 

 

	Signature of Authorized Signatory of Holder: 	/s/ Moise Emquies	 

 

	Name of Authorized Signatory:	 	 

 

	Title of Authorized Signatory:	 	 

 

[SIGNATURE PAGES CONTINUE]

 

    13

    

    

 

[SIGNATURE
PAGE OF HOLDERS]

 

	Name of Holder: 	George Levy	 

 

	Signature of Authorized Signatory of Holder: 	/s/ George Levy	 

 

	Name of Authorized Signatory:	 	 

 

	Title of Authorized Signatory:	 	 

 

[SIGNATURE PAGES CONTINUE]

 

    14

    

    

 

[SIGNATURE
PAGE OF HOLDERS]

 

	Name of Holder: 	Matthieu Leblan	 

 

	Signature of Authorized Signatory of Holder: 	/s/ Matthieu Leblan	 

 

	Name of Authorized Signatory:	 	 

 

	Title of Authorized Signatory:	 	 

 

[SIGNATURE PAGES CONTINUE]

 

    15

    

    

 

[SIGNATURE
PAGE OF HOLDERS]

 

	Name of Holder: 	Carol
    Ann Emquies	 

 

	Signature of Authorized Signatory
    of Holder: 	/s/
    Carol Ann Emquies	 

 

	Name of Authorized Signatory:	 	 

 

	Title of Authorized Signatory:	 	 

 

    16

    

    

 

Annex A

 

Plan of Distribution

 

Each Selling Securityholder
(the “Selling Securityholder”) of the securities and any of their pledgees, assignees and successors-in-interest may,
from time to time, sell any or all of their securities covered hereby on the principal Trading Market or any other stock exchange, market
or trading facility on which the securities are traded or in private transactions. These sales may be at fixed or negotiated prices. A
Selling Securityholder may use any one or more of the following methods when selling securities:

 

	 	●	ordinary brokerage transactions and transactions in which the broker-dealer solicits purchasers;
	 	 	 
	 	●	block trades in which the broker-dealer will attempt to sell the securities as agent but may position and resell a portion of the block as principal to facilitate the transaction;
	 	 	 
	 	●	purchases by a broker-dealer as principal and resale by the broker-dealer for its account;
	 	 	 
	 	●	an exchange distribution in accordance with the rules of the applicable exchange;
	 	 	 
	 	●	privately negotiated transactions;
	 	 	 
	 	●	settlement of short sales;
	 	 	 
	 	●	in transactions through broker-dealers that agree with the Selling Securityholders to sell a specified number of such securities at a stipulated price per security;
	 	 	 
	 	●	through the writing or settlement of options or other hedging transactions, whether through an options exchange or otherwise;
	 	 	 
	 	●	a combination of any such methods of sale; or
	 	 	 
	 	●	any other method permitted pursuant to applicable law.

 

The Selling Securityholders
may also sell securities under Rule 144 or any other exemption from registration under the Securities Act of 1933, as amended (the
 “Securities Act”), if available, rather than under this prospectus.

 

Broker-dealers engaged by
the Selling Securityholders may arrange for other brokers-dealers to participate in sales. Broker-dealers may receive commissions or discounts
from the Selling Securityholders (or, if any broker-dealer acts as agent for the purchaser of securities, from the purchaser) in amounts
to be negotiated, but, except as set forth in a supplement to this Prospectus, in the case of an agency transaction not in excess of a
customary brokerage commission in compliance with FINRA Rule 2121; and in the case of a principal transaction a markup or markdown
in compliance with FINRA Rule 2121.

 

In connection with the sale
of the securities or interests therein, the Selling Securityholders may enter into hedging transactions with broker-dealers or other financial
institutions, which may in turn engage in short sales of the securities in the course of hedging the positions they assume. The Selling
Securityholders may also sell securities short and deliver these securities to close out their short positions, or loan or pledge the
securities to broker-dealers that in turn may sell these securities. The Selling Securityholders may also enter into option or other transactions
with broker-dealers or other financial institutions or create one or more derivative securities which require the delivery to such broker-dealer
or other financial institution of securities offered by this prospectus, which securities such broker-dealer or other financial institution
may resell pursuant to this prospectus (as supplemented or amended to reflect such transaction).

 

    17

    

    

 

The Selling Securityholders
and any broker-dealers or agents that are involved in selling the securities may be deemed to be “underwriters” within the
meaning of the Securities Act in connection with such sales. In such event, any commissions received by such broker-dealers or agents
and any profit on the resale of the securities purchased by them may be deemed to be underwriting commissions or discounts under the Securities
Act. Each Selling Securityholders has informed the Company that it does not have any written or oral agreement or understanding, directly
or indirectly, with any person to distribute the securities.

 

The Company is required to
pay certain fees and expenses incurred by the Company incident to the registration of the securities. The Company has agreed to indemnify
the Selling Securityholders against certain losses, claims, damages and liabilities, including liabilities under the Securities Act.

 

We agreed to keep this prospectus
effective until the earlier of (i) the date on which the securities may be resold by the Selling Securityholders without registration
and without regard to any volume or manner-of-sale limitations by reason of Rule 144, without the requirement for the Company to
be in compliance with the current public information under Rule 144 under the Securities Act or any other rule of similar effect
or (ii) all of the securities have been sold pursuant to this prospectus or Rule 144 under the Securities Act or any other rule of
similar effect. The resale securities will be sold only through registered or licensed brokers or dealers if required under applicable
state securities laws. In addition, in certain states, the resale securities covered hereby may not be sold unless they have been registered
or qualified for sale in the applicable state or an exemption from the registration or qualification requirement is available and is complied
with.

 

Under applicable rules and
regulations under the Exchange Act, any person engaged in the distribution of the resale securities may not simultaneously engage in market
making activities with respect to the shares of Common Stock for the applicable restricted period, as defined in Regulation M, prior to
the commencement of the distribution. In addition, the Selling Securityholders will be subject to applicable provisions of the Exchange
Act and the rules and regulations thereunder, including Regulation M, which may limit the timing of purchases and sales of the shares
of Common Stock by the Selling Securityholders or any other person. We will make copies of this prospectus available to the Selling Securityholders
and have informed them of the need to deliver a copy of this prospectus to each purchaser at or prior to the time of the sale (including
by compliance with Rule 172 under the Securities Act).

 

    18

    

    

 

Annex B

 

SELLING SECURITYHOLDERS

 

The shares of Common Stock
being offered by the Selling Securityholders are those issued and issuable to the Selling Securityholders pursuant to the MPA. For additional
information regarding the issuances of those shares of Common Stock, see “Private Placement of Common Stock” above. We are
registering the shares of Common Stock in order to permit the Selling Securityholders to offer the shares for resale from time to time.
Except for the ownership of the shares of Common Stock, the Selling Securityholders have not had any material relationship with us within
the past three years, except as contemplated by the MPA.

 

The table below lists the
Selling Securityholders and other information regarding the beneficial ownership of the shares of Common Stock by each of the Selling
Securityholders. The second column lists the number of shares of Common Stock beneficially owned by each Selling Securityholder, based
on its ownership of the shares of Common Stock, as of ________, 2022.

 

The third column lists the
shares of Common Stock being offered by this prospectus by the Selling Securityholders.

 

In accordance with the terms
of a registration rights agreement with the Selling Securityholders, this prospectus generally covers the resale of the sum of the number
of shares of Common Stock issued and issuable to the Selling Securityholders, as described in “Private Placement of Common Stock”
above. The fourth column assumes the sale of all of the shares offered by the Selling Securityholders pursuant to this prospectus.

 

The Selling Securityholders
may sell all, some or none of their shares in this offering. See “Plan of Distribution.”

 

	Name of Selling Securityholder	 	Number of shares

 of Common Stock

 Owned Prior to

 Offering	 	Maximum Number

 of shares of

 Common Stock to

 be Sold Pursuant to

 this Prospectus	 	Number of shares

 of Common Stock

 Owned After

 Offering
	 	 	 	 	 	 	 
	 	 	 	 	 	 	 

 

    19

    

    

 

Annex C

 

DIGITAL
BRANDS GROUP, INC.

 

Selling Securityholder Notice and Questionnaire

 

The undersigned beneficial
owner of shares of Common Stock (the “Registrable Securities”) of Digital Brands Group, Inc., a Delaware corporation
(the “Company”), understands that the Company has filed or intends to file with the Securities and Exchange Commission
(the “Commission”) a registration statement (the “Registration Statement”) for the registration
and resale under Rule 415 of the Securities Act of 1933, as amended (the “Securities Act”), of the Registrable
Securities, in accordance with the terms of the Registration Rights Agreement (the “Registration Rights Agreement”)
to which this document is annexed. A copy of the Registration Rights Agreement is available from the Company upon request at the address
set forth below. All capitalized terms not otherwise defined herein shall have the meanings ascribed thereto in the Registration Rights
Agreement.

 

Certain legal consequences
arise from being named as a Selling Securityholder in the Registration Statement and the related prospectus. Accordingly, holders and
beneficial owners of Registrable Securities are advised to consult their own securities law counsel regarding the consequences of being
named or not being named as a Selling Securityholder in the Registration Statement and the related prospectus.

 

NOTICE

 

The undersigned beneficial owner (the “Selling
Securityholder”) of Registrable Securities hereby elects to include the Registrable Securities owned by it in the Registration
Statement.

 

    20

    

    

 

The undersigned hereby provides the following information to the Company
and represents and warrants that such information is accurate:

 

QUESTIONNAIRE

 

	1.	Name.

 

	 	(a)	Full Legal Name of Selling Securityholder
	 	 	 
	 	 	 

 

	 	(b)	Full Legal Name of Registered Holder (if not the same as (a) above) through which Registrable Securities are held:
	 	 	 
	 	 	 

 

	 	(c)	Full Legal Name of Natural Control Person (which means a natural person who directly or indirectly alone or with others has power to vote or dispose of the securities covered by this Questionnaire):
	 	 	 
	 	 	 

 

		2.	Address for Notices to Selling Securityholder:

 

	 
	 
	 

	Telephone:	 

	Fax:	 

	Contact Person:	 

 

		3.	Broker-Dealer Status:

 

	 	(a)	Are you a broker-dealer?
	 	 	 
	Yes    ̈              No    ̈

 

	 	(b)	If “yes” to Section 3(a), did you receive your Registrable Securities as compensation for investment banking services to the Company?
	 	 	 
	Yes    ̈              No    ̈

 

	 	Note:	If “no” to Section 3(b), the Commission’s staff has indicated that you should be identified as an underwriter in the Registration Statement.

 

	 	(c)	Are you an affiliate of a broker-dealer?
	 	 	 
	Yes    ̈              No    ̈

 

    21

    

    

 

	 	(d)	If you are an affiliate of a broker-dealer, do you certify that you purchased the Registrable Securities in the ordinary course of business, and at the time of the purchase of the Registrable Securities to be resold, you had no agreements or understandings, directly or indirectly, with any person to distribute the Registrable Securities?
	 	 	 
	Yes    ̈              No    ̈

 

	 	Note:	If “no” to Section 3(d), the Commission’s staff has indicated that you should be identified as an underwriter in the Registration Statement.

 

		4.	Beneficial Ownership of Securities of the Company Owned by the Selling Securityholder.

 

Except as set forth below in this
Item 4, the undersigned is not the beneficial or registered owner of any securities of the Company other than the securities issuable
pursuant to the MPA.

 

	 	(a)	Type and Amount of other securities beneficially owned by the Selling Securityholder:
	 	 	 
	 	 	 
	 	 	 

 

		5.	Relationships with the Company:

 

Except as set forth below, neither
the undersigned nor any of its affiliates, officers, directors or principal equity holders (owners of 5% of more of the equity securities
of the undersigned) has held any position or office or has had any other material relationship with the Company (or its predecessors or
affiliates) during the past three years.

 

State any exceptions here:

 

	 	 
	 	 

 

The undersigned agrees to promptly notify the
Company of any material inaccuracies or changes in the information provided herein that may occur subsequent to the date hereof at any
time while the Registration Statement remains effective; provided, that the undersigned shall not be required to notify the Company of
any changes to the number of securities held or owned by the undersigned or its affiliates.

 

By signing below, the undersigned consents to
the disclosure of the information contained herein in its answers to Items 1 through 5 and the inclusion of such information in the Registration
Statement and the related prospectus and any amendments or supplements thereto. The undersigned understands that such information will
be relied upon by the Company in connection with the preparation or amendment of the Registration Statement and the related prospectus
and any amendments or supplements thereto.

 

    22

    

    

 

IN WITNESS WHEREOF the undersigned,
by authority duly given, has caused this Notice and Questionnaire to be executed and delivered either in person or by its duly authorized
agent.

 

	Date:	          	 	Beneficial Owner:	        

 

	 	By:	 
	 	Name:	 
	 	Title:	 

 

PLEASE FAX A COPY (OR EMAIL A .PDF COPY) OF
THE COMPLETED AND EXECUTED NOTICE AND QUESTIONNAIRE TO:

 

    23

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