Document:

Exhibit 10.14

 

Salisbury
Bank and Trust Company

Employee
Stock Ownership Plan

 

SALISBURY BANK AND TRUST COMPANY

 

EMPLOYEE STOCK OWNERSHIP PLAN

 

 

 

(adopted effective January 1, 2013)

 

SALISBURY BANK AND TRUST COMPANY

EMPLOYEE STOCK OWNERSHIP PLAN

 

This Employee Stock Ownership
Plan (the “Plan”) has been executed, effective as of the 1st day of January, 2013, by Salisbury Bank and
Trust Company.

 

 

W I T N E S S E T H  T H A T

 

WHEREAS, the board of directors
of the Bank has resolved to adopt an employee stock ownership plan for eligible employees of the Bank and subsidiaries of the Bank,
if any, in accordance with the terms and conditions set forth herein;

 

NOW, THEREFORE, the Bank
hereby adopts the following Plan setting forth the terms and conditions pertaining to contributions by the Employer and the payment
of benefits to Participants and Beneficiaries.

 

IN WITNESS WHEREOF, the
Bank has adopted this Plan and caused this instrument to be executed by its duly authorized officers as of the above date.

 

 

 

 

	ATTEST:	 	SALISBURY BANK AND TRUST COMPANY
	 	 	 
	 	 	 
	/s/ Shelly L. Humeston	By:  	/s/ Richard J. Cantele, Jr.
	Secretary		President and Chief Executive Officer
	 	 	

 

    	 

    	 

    

C O N T E N T S

 

	 	 	 	Page No.
	Section 1.	 	Plan Identity	1
	 	1.1	Name	1
	 	1.2	Purpose	1
	 	1.3	Effective Date	1
	 	1.4	Fiscal Period	1
	 	1.5	Single Plan for All Employers	1
	 	1.6	Interpretation of Provisions	1
	Section 2.	 	Definitions	1
	Section 3.	 	Eligibility for Participation	10
	 	3.1	Initial Eligibility	10
	 	3.2	Definition of Eligibility Year	10
	 	3.3	Terminated Employees	11
	 	3.4	Certain Employees Ineligible	11
	 	3.5	Participation and Reparticipation	11
	 	3.6	Omission of Eligible Employee	11
	 	3.7	Inclusion of Ineligible Employee	12
	Section 4.	 	Contribution and Credits	12
	 	4.1	Discretionary Contributions	12
	 	4.2	Contributions for Exempt Loans	12
	 	4.3	Conditions as to Contributions	13
	 	4.4	Rollover Contributions	13
	Section 5.	 	Limitations on Contributions and Allocations	13
	 	5.1	Limitation on Annual Additions	13
	 	5.2	Effect of Limitations	15
	 	5.3	Limitations as to Certain Participants	15
	 	5.4	Erroneous Allocations	16
	Section 6.	 	Trust Fund and Its Investment	16
	 	6.1	Creation of Trust Fund	16
	 	6.2	Stock Fund and Investment Fund	16
	 	6.3	Acquisition of Stock	17
	 	6.4	Participants' Option to Diversify	18
	Section 7.	 	Voting Rights and Dividends on Stock	18
	 	7.1	Voting and Tendering of Stock	19
	 	7.2	Application of Dividends	19
	Section 8.	 	Adjustments to Accounts	21
	 	8.1	ESOP Allocations	21
	 	8.2	Charges to Accounts	22
	 	8.3	Stock Fund Account	22
	 	8.4	Investment Fund Account	22
	 	8.5	Adjustment to Value of Trust Fund	22
	 	8.6	Participant Statements	23
	Section 9.	 	Vesting of Participants' Interests	23
	 	9.1	Vesting in Accounts	23
	 	9.2	Computation of Vesting Years	23
	 	9.3	Full Vesting Upon Certain Events	24
	 	9.4	Full Vesting Upon Plan Termination	25
	 	9.5	Forfeiture, Repayment, and Restoral	25
	 	9.6	Accounting for Forfeitures	26
	 	9.7	Vesting and Nonforfeitability	26
	Section 10.	 	Payment of Benefits	26
	 	10.1	Benefits for Participants	26
	 	10.2	Time for Distribution	27
	 	10.3	Marital Status	29
	 	10.4	Delay in Benefit Determination	29
	 	10.5	Accounting for Benefit Payments	29
	 	10.6	Options to Receive Stock	29
	 	10.7	Restrictions on Disposition of Stock	30
	 	10.8	Continuing Loan Provisions; Creations of Protections and Rights	30
	 	10.9	Direct Rollover of Eligible Distribution	30
	 	10.10	Waiver of 30-Day Period After Notice of Distribution	31
	Section 11.	 	Rules Governing Benefit Claims and Review of Appeals	31
	 	11.1	Claim for Benefits	32
	 	11.2	Notification by Committee	32
	 	11.3	Claims Review Procedure	32
	Section 12.	 	The Committee and its Functions	32
	 	12.1	Authority of Committee	32
	 	12.2	Identity of Committee	33
	 	12.3	Duties of Committee	33
	 	12.4	Valuation of Stock	33
	 	12.5	Compliance with ERISA	33
	 	12.6	Action by Committee	33
	 	12.7	Execution of Documents	34
	 	12.8	Adoption of Rules	34
	 	12.9	Responsibilities to Participants	34
	 	12.10	Alternative Payees in Event of Incapacity	34
	 	12.11	Indemnification by Employers	34
	 	12.12	Nonparticipation by Interested Member	34
	Section 13.	 	Adoption, Amendment, or Termination of the Plan	35
	 	13.1	Adoption of Plan by Other Employers	35
	 	13.2	Plan Adoption Subject to Qualification	35
	 	13.3	Right to Amend or Terminate	35
	Section 14.	 	Miscellaneous Provisions	36
	 	14.1	Plan Creates No Employment Rights	36
	 	14.2	Nonassignability of Benefits	36
	 	14.3	Limit of Employer Liability	36
	 	14.4	Treatment of Expenses	36
	 	14.5	Number and Gender	36
	 	14.6	Nondiversion of Assets	36
	 	14.7	Separability of Provisions	36
	 	14.8	Service of Process	37
	 	14.9	Governing State Law	37
	 	14.10	Employer Contributions Conditioned on Deductibility	37
	 	14.11	Unclaimed Accounts	37
	 	14.12	Qualified Domestic Relations Order	37
	 	14.13	Use of Electronic Media to Provide Notices and Make Participant Elections	38
	 	14.14	Acquisition of Securities	38
	Section 15.	 	Top-Heavy Provisions	38
	 	15.1	Top-Heavy Plan	38
	 	15.2	Definitions	39
	 	15.3	Top-Heavy Rules of Application	40
	 	15.4	Minimum Contributions	41
	 	15.5	Top-Heavy Provisions Control in Top-Heavy Plan	41

 

    	 

    	 

    

SALISBURY BANK AND TRUST COMPANY

EMPLOYEE STOCK OWNERSHIP PLAN

 

 

Section 1.Plan Identity.

1.1Name.
The name of this Plan is “Salisbury Bank and Trust Company Employee Stock Ownership Plan.”

1.2Purpose.
The purpose of this Plan is to describe the terms and conditions under which contributions made pursuant to the Plan will be credited
and paid to the Participants and their Beneficiaries.

1.3Effective
Date. The Effective Date of this Plan is January 1, 2013.

1.4Fiscal
Period. This Plan shall be operated on the basis of a January 1 to December 31 fiscal year for the purpose of keeping
the Plan’s books and records and distributing or filing any reports or returns required by law.

1.5Single
Plan for All Employers. This Plan shall be treated as a single plan with respect to all participating Employers for the
purpose of crediting contributions and forfeitures and distributing benefits, determining whether there has been any termination
of Service, and applying the limitations set forth in Section 5.

1.6Interpretation
of Provisions. The Employers intend this Plan and the Trust Agreement to be a qualified stock bonus plan under Section
401(a) of the Code and an employee stock ownership plan within the meaning of Section 407(d)(6) of ERISA and Section 4975(e)(7)
of the Code. The Plan is intended to have its assets invested primarily in qualifying employer securities of one or more Employers
within the meaning of Section 407(d)(3) of ERISA, and to satisfy any requirement under ERISA or the Code applicable to such a plan.

Accordingly, the
Plan and Trust Agreement shall be interpreted and applied in a manner consistent with this intent and shall be administered at
all times and in all respects in a nondiscriminatory manner.

Section 2.Definitions.

The following capitalized
words and phrases shall have the meanings specified when used in this Plan and in the Trust Agreement, unless the context clearly
indicates otherwise:

“Account”
means a Participant’s interest in the assets accumulated under this Plan as expressed in terms of a separate account balance
which is periodically adjusted to reflect his Employer’s contributions, the Plan’s investment experience, and distributions
and forfeitures.

“Active
Participant” means a Participant who has satisfied the eligibility requirements under Section 3 and who has at least
1,000 Hours of Service during the current Plan Year. However, a Participant shall not qualify as an Active Participant unless (i)
he is in active Service with an Employer as of the last day of the Plan Year, or (ii) he is on a Recognized Absence as of that
date, or (iii) his Service terminated during the Plan Year by reason of Disability, death, or Normal Retirement.

“Bank”
means Salisbury Bank and Trust Company and any entity which succeeds to the business of Salisbury Bank and Trust Company and adopts
this Plan as its own pursuant to Section 13.1 of the Plan.

“Beneficiary”
means the person or persons who are designated by a Participant to receive benefits payable under the Plan on the Participant’s
death. In the absence of any designation or if all the designated Beneficiaries shall die before the Participant dies or shall
die before all benefits have been paid, the Participant’s Beneficiary shall be his surviving Spouse, if any, or his estate
if he is not survived by a Spouse. The Committee may rely upon the advice of the Participant’s executor or administrator
as to the identity of the Participant’s Spouse.

    	1

    	 

    

“Break
in Service” means any Plan Year, or, for the initial eligibility computation period under Section 3.2, the 12-consecutive
month period beginning on the first day of which an Employee has an Hour of Service, in which an Employee has 500 or fewer Hours
of Service. Solely for this purpose, an Employee shall be considered employed for his normal hours of paid employment during a
Recognized Absence (said Employee shall not be credited with more than 501 Hours of Service to avoid a Break in Service), unless
he does not resume his Service at the end of the Recognized Absence. Further, if an Employee is absent for any period (i) by reason
of the Employee’s pregnancy, (ii) by reason of the birth of the Employee’s child, (iii) by reason of the placement
of a child with the Employee in connection with the Employee’s adoption of the child, or (iv) for purposes of caring for
such child for a period beginning immediately after such birth or placement, the Employee shall be credited with the Hours of Service
which would normally have been credited but for such absence, up to a maximum of 501 Hours of Service. Hours of Service shall be
credited only in the year in which the absence from work begins, if a Participant would be prevented from incurring a one-year
Break in Service in such year solely because the period of absence is treated as Hours of Service, or in any other case, in the
immediately following year.

“Closing
Date” means the closing date of the stock offering of the Company.

“Code”
means the Internal Revenue Code of 1986, as amended.

“Committee”
means the committee responsible for the administration of this Plan in accordance with Section 12.

“Company”
means Salisbury Bancorp, Inc., the holding company of the Bank, and any successor entity which succeeds to the business of the
Company.

“Compensation”
shall mean:

(a)415
Compensation.

(b)If
a determination period consists of fewer than 12 months, the annual compensation limit is an amount equal to the otherwise applicable
compensation limit set forth under Section 5.1-2 multiplied by a fraction. The numerator of the fraction is the number of months
in the short determination period, and the denominator of the fraction is 12.

(c)A Participant’s
Compensation, for Plan purposes, shall include all Compensation earned during the Plan Year, including Compensation earned during
the Plan Year prior to the Participant’s Entry Date.

“Disability”
means the inability to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment
which can be expected to result in death or which has lasted or can be expected to last for a continuous period of not less than
12 months. An individual shall not be considered to be permanently and totally disabled unless he furnishes proof of the existence
thereof in such form and manner, and at such times, as the Committee may require.

“Eligible
Employee” means an Employee, other than an Employee identified in Section 3.4, who has performed 1,000 Hours of Service
in the applicable Eligibility Year in accordance with Section 3.2 and who has attained age 18.

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“Employee”
means any individual who is or has been employed or self-employed by an Employer. “Employee” also means an individual
employed by a leasing organization who, pursuant to an agreement between an Employer and the leasing organization, has performed
services for the Employer and any related persons (within the meaning of Section 414(n)(6) of the Code) on a substantially full-time
basis for more than one year, if such services are performed under the primary direction or control of the Employer. However, such
a “leased employee” shall not be considered an Employee if (i) he participates in a money purchase pension plan sponsored
by the leasing organization which provides for immediate participation, immediate full vesting, and an annual contribution of at
least 10 percent of the Employee’s 415 Compensation, and (ii) leased employees do not constitute more than 20 percent of
the Employer’s total work force (including leased employees, but excluding Highly Compensated Employees and any other Employees
who have not performed services for the Employer on a substantially full-time basis for at least one year).

“Employer”
means the Bank or any affiliate within the purview of section 414(b), (c) or (m) and 415(h) of the Code, any other corporation,
partnership, or proprietorship which adopts this Plan with the Bank’s consent pursuant to Section 13.1, and any entity which
succeeds to the business of any Employer and adopts the Plan pursuant to Section 13.

“Entry
Date” means January 1, 2013 and each July 1 and January 1 of each Plan Year after such date.

“ERISA”
means the Employee Retirement Income Security Act of 1974 (P.L. 93-406, as amended).

“Exempt
Loan” means an indebtedness arising from any extension of credit to the Plan or the Trust which satisfies the requirements
set forth in Section 6.3 and which was obtained for any or all of the following purposes:

(i)to
acquire qualifying Employer securities as defined in Treasury Regulations Section 54.4975-12;

(ii)to
repay such Exempt Loan; or

(iii)to
repay a prior exempt loan.

“415 Compensation”
shall mean:

(a)Wages
(including overtime pay, bonuses and commissions), as defined in Code Section 3401(a) for purposes of income tax withholding at
the source.

(b)Any
elective deferral as defined in Code Section 402(g)(3) (any Employer contributions made on behalf of a Participant to the extent
not includible in gross income and any Employer contributions to purchase an annuity contract under Code Section 403(b) under a
salary reduction agreement), and any amount which is contributed or deferred by the Employer at the election of the Participant
and which is not includible in gross income of the Participant by reason of Code Section 125 (including any “deemed”
Code Section 125 compensation) (Cafeteria Plan), Code Section 457, 132(f)(4) or because such amount was deferred in accordance
with an Employer-provided deferred compensation plan, shall also be included in the definition of 415 Compensation.

(c)415
Compensation shall also include the following types of compensation paid after a Participant’s severance from employment
with the Employer, provided that amounts described in paragraphs (i) or (ii) below shall only be included in 415 Compensation to
the extent such amounts are paid by the later of 21⁄2 months after severance from employment, or by the end of the limitation
year that includes the date of such severance from employment.

(i)Regular
Pay. 415 Compensation shall include regular pay after severance from employment if (a) the payment is for regular compensation
for services during the Participant’s regular working hours, or compensation for services outside of the Participant’s
regular working hours (such as overtime or shift differential), commissions, bonuses, or other similar payments, and (b) the payment
would have been paid to the Participant prior to severance from employment if the Participant had continued in employment with
the Employer.

(ii)Leave
Cashouts. Leave cashouts shall be included in 415 Compensation if those amounts would have been included in the definition of 415
Compensation if they were paid prior to the Participant’s severance from employment, and the amounts are payment for unused
accrued bona fide sick, vacation or other leave, but only if the Participant would have been able to use the leave if his employment
had continued.

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(d)415
Compensation includes differential wage payments (as defined in Code Section 3401(h)) paid by the Employer to a former Employee
who is performing qualified military services (as defined in Code Section 414(u)(1)) but only to the extent that those differential
wage payments do not exceed the amounts the individual would have received if the individual had continued to perform services
for the Employer rather than entering qualified military service.

(e)415
Compensation in excess of $255,000 (as indexed) shall be disregarded for all Participants. For purposes of this sub-section, the
$255,000 limit shall be referred to as the “applicable limit” for the Plan Year in question. The $255,000 limit shall
be adjusted for increases in the cost of living in accordance with Section 401(a)(17)(B) of the Code, effective for the Plan Year
which begins within the applicable calendar year. For purposes of the applicable limit, 415 Compensation shall be prorated
over short Plan Years and only compensation for the portion of the Plan Year during which the individual was a Participant shall
be taken into account.

“Highly
Compensated Employee” for any Plan Year means an Employee who, during either that or the immediately preceding Plan Year
was at any time a five percent owner of the Employer (as defined in Code Section 416(i)(1)) or, during the immediately preceding
Plan Year, had 415 Compensation exceeding $115,000 (as adjusted). The applicable year for which a determination is being made is
called a “determination year” and the preceding 12-month period is called a look-back year.

“Hours
of Service” means hours to be credited to an Employee under the following rules:

(a)Each
hour for which an Employee is paid or is entitled to be paid for services to an Employer is an Hour of Service.

(b)Each
hour for which an Employee is directly or indirectly paid or is entitled to be paid for a period of vacation, holidays, illness,
disability, lay-off, jury duty, temporary military duty, or leave of absence is an Hour of Service. However, except as otherwise
specifically provided, no more than 501 Hours of Service shall be credited for any single continuous period which an Employee performs
no duties. No more than 501 Hours of Service will be credited under this paragraph for any single continuous period (whether or
not such period occurs in a single computation period). Further, no Hours of Service shall be credited on account of payments made
solely under a plan maintained to comply with worker’s compensation, unemployment compensation, or disability insurance laws,
or to reimburse an Employee for medical expenses.

(c)Each
hour for which back pay (ignoring any mitigation of damages) is either awarded or agreed to by an Employer is an Hour of Service.
However, no more than 501 Hours of Service shall be credited for any single continuous period during which an Employee would not
have performed any duties. The same Hours of Service will not be credited both under paragraph (a) or (b) as the case may be, and
under this paragraph (c). These hours will be credited to the employee for the computation period or periods to which the award
or agreement pertains rather than the computation period in which the award agreement or payment is made.

(d)Hours
of Service shall be credited in any one period only under one of the foregoing paragraphs (a), (b) and (c); an Employee may not
get double credit for the same period.

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(e)If
an Employer finds it impractical to count the actual Hours of Service for any class or group of non-hourly Employees, each Employee
in that class or group shall be credited with 90 Hours of Service for each bi-weekly pay period in which he has at least one Hour
of Service. However, an Employee shall be credited only for his normal working hours during a paid absence.

(f)Hours
of Service to be credited on account of a payment to an Employee (including back pay) shall be recorded in the period of Service
for which the payment was made. If the period overlaps two or more Plan Years, the Hours of Service credit shall be allocated in
proportion to the respective portions of the period included in the several Plan Years. However, in the case of periods of 31 days
or less, the Committee may apply a uniform policy of crediting the Hours of Service to either the first Plan Year or the second.

(g)In
all respects an Employee’s Hours of Service shall be counted as required by Section 2530.200b-2(b) and (c) of the Department
of Labor’s regulations under Title I of ERISA.

“Investment
Fund” means that portion of the Trust Fund consisting of assets other than Stock. Notwithstanding the above, assets from
the Investment Fund may be used to purchase Stock in the open market or otherwise, or used to pay on the Exempt Loan, and shares
so purchased will be allocated to a Participant’s Stock Fund.

“Normal
Retirement” means retirement on or after the Participant’s Normal Retirement Date.

“Normal
Retirement Date” means the Participant’s 65th birthday.

“Participant”
means any Eligible Employee who is an Active Participant participating in the Plan, or Eligible Employee or former Employee who
was previously an Active Participant and still has a balance credited to his Account.

“Period
of Uniformed Service” means the length of time that an Employee serves in the Uniformed Services.

“Plan Year”
means the twelve-month period commencing January 1 and ending December 31 and each period of 12 consecutive months beginning on
January 1 of each succeeding year.

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“Recognized
Absence” means a period for which --

(a)an
Employer grants an Employee a leave of absence for a limited period, but only if an Employer grants such leave on a nondiscriminatory
basis; or

(b)an
Employee is temporarily laid off by an Employer because of a change in business conditions; or

(c)an
Employee is on active military duty, but only to the extent that his employment rights are protected by the Military Selective
Service Act of 1967 (38 U.S.C. Sec. 2021).

“Reemployment
After a Period of Uniformed Service”

(a)“Reemployment
(or Reemployed) After a Period of Uniformed Service” means that an Employee returned to employment with a Participating
Employer, within the time frame set forth in subparagraph (b) below, after a Period of Uniformed Service in the Uniformed
Services and the following rules corresponding to provisions of the Uniformed Services Employment and Reemployment Rights Act of
1994 (“USERRA”) apply: (i) he or she gives sufficient notice of leave to the Participating Employer prior
to commencing a Period of Uniformed Service, or is excused from providing such notice; (ii) his or her employment with the
Participating Employer prior to a Period of Uniformed Service was not of a brief, nonrecurrent nature that would preclude a reasonable
expectation that such employment would continue indefinitely or for a significant period; (iii) the Participating Employer’s
circumstances have not changed so that reemployment is unreasonable or an undue hardship to the Participating Employer; and (iv) the
applicable cumulative Periods of Uniformed Service under USERRA equals five years or less, unless service in the Uniformed Services:

(1)in excess
of five years is required to complete an initial Period of Uniformed Service;

(2)prevents
the Participant from obtaining orders releasing him or her from such Period of Uniformed Service prior to the expiration of a five-year
period (through no fault of the Participant);

(3)is required
in the National Guard for drill and instruction, field exercises or active duty training, or to fulfill necessary additional training,
or to fulfill necessary additional training requirements certified in writing by the Secretary of the branch of Uniformed Services
concerned; or

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(4)for a
Participant is:

(A)required
other than for training under any provisions of law during a war or national agency declared by the President or Congress;

(B)required
(other than for training) in support of an operational mission for which personnel have been ordered to active duty other
than during war or national emergency;

(C)required
in support of a critical mission or requirement of the Uniformed Services; or

(D)the
result of being called into service as a member of the National Guard by the President in the case of rebellion or danger of rebellion
against the authority of the United States Government or if the President is unable to execute the laws of the United States with
the regular forces.

(b)The
applicable statutory time frames within which an Employee must report to a Participating Employer after a Period of Uniformed Service
are as follows:

(1)If the
Period of Uniformed Service was less than 31 days,

(A)not
later than the beginning of the first full regularly scheduled work period on the first full calendar day following the completion
of the Period of Uniformed Service and the expiration of eight hours after a period of time allowing for the safe transportation
of the Employee from the place of service in the Uniformed Services to the Employee’s residence; or

(B)as
soon as possible after the expiration of the eight-hour period of time referred to in Clause (A), if reporting within the period
referred to in such clause is impossible or unreasonable through no fault of the Employee.

    	7

    	 

    

(2)In the
case of an Employee whose Period of Uniformed Service was for more than 30 days but less than 181 days, by submitting an application
for reemployment with a Participating Employer not later than 14 days after the completion of the Period of Uniformed Service or,
if submitting such application within such period is impossible or unreasonable through no fault of the Employee, the next first
full calendar day when submission of such application becomes reasonable.

(3)In the
case of an Employee whose Period of Uniformed Service was for more than 180 days, by submitting an application for reemployment
with a Participating Employer not later than 90 days after the completion of the Period of Uniformed Service.

(4)In the
case of an Employee who is hospitalized for, or convalescing from, an illness or injury related to the Period of Uniformed Service
the Employee shall apply for reemployment with a Participating Employer at the end of the period that is necessary for the Employee
to recover. Such period of recovery shall not exceed two years, unless circumstances beyond the Employee’s control make reporting
as above unreasonable or impossible.

(c)Notwithstanding
subparagraph (a), Reemployment After a Period of Uniformed Service terminates upon the occurrence of any of the following:

(1)a dishonorable
or bad conduct discharge from the Uniformed Services;

(2)any other
discharge from the Uniformed Services under circumstances other than an honorable condition;

(3)a discharge
of a commissioned officer from the Uniformed Services by court martial, by commutation of sentence by court martial, or, in time
of war, by the President; or

(4)a demotion
of a commissioned officer in the Uniformed Services for absence without authorized leave of at least 3 months confinement under
a sentence by court martial, or confinement in a federal or state penitentiary after being found guilty of a crime under a final
sentence.

    	8

    	 

    

“Service”
means an Employee’s period(s) of employment or self-employment with an Employer, excluding for initial eligibility purposes
any period in which the individual was a nonresident alien and did not receive from an Employer any earned income which constituted
income from sources within the United States. An Employee’s Service shall include any Service which constitutes Service with
a predecessor Employer within the meaning of Section 414(a) of the Code, provided, however, that Service with an acquired entity
shall not be considered Service under the Plan unless required by applicable law or agreed to by the parties to such transaction.
An Employee’s Service shall also include any Service with an entity which is not an Employer, but only either (i) in which
the other entity is a member of a controlled group of corporations or is under common control with other trades and businesses
within the meaning of Section 414(b) or 414(c) of the Code, and a member of the controlled group or one of the trades and businesses
is an Employer, (ii) in which the other entity is a member of an affiliated service group within the meaning of Section 414(m)
of the Code, and a member of the affiliated service group is an Employer, or (iii) all Employers aggregated with the Employer under
Section 414(o) of the Code (but not until the Proposed Regulations under Section 414(o) become effective). Notwithstanding any
provision of this Plan to the contrary, contributions, benefits and service credit with respect to qualified military service will
be provided in accordance with Section 414(u) of the Code.

“Spouse”
means the individual, if any, to whom a Participant is lawfully married on the date benefit payments to the Participant are to
begin, or on the date of the Participant’s death, if earlier. A former Spouse shall be treated as the Spouse or surviving
Spouse to the extent provided under a qualified domestic relations order as described in section 414(p) of the Code.

“Stock”
means common stock issued by the Employer (or by a corporation which is a member of the same controlled group) which is readily
tradable on an established securities market. In the event there is no common stock which meets the requirements of the preceding
sentence, then “Stock” means common stock issued by the Employer (or by a corporation which is a member of the same
controlled group) having a combined voting power and dividend rights equal to or in excess of (A) that class of common stock of
the Employer (or of any other such corporation) having the greatest voting power; and (B) that class of common stock of the Employer
(or of any other such corporation) having the greatest dividend rights.

“Stock
Fund” means that portion of the Trust Fund consisting of Stock.

“Trust”
or “Trust Fund” means the trust fund created under this Plan.

“Trust
Agreement” means the agreement between the Bank and the Trustee concerning the Trust Fund. If any assets of the Trust
Fund are held in a co-mingled trust fund with assets of other qualified retirement plans, “Trust Agreement” shall be
deemed to include the trust agreement governing that co-mingled trust fund. With respect to the allocation of investment responsibility
for the assets of the Trust Fund, the provisions of Article II of the Trust Agreement are incorporated herein by reference.

“Trustee”
means one or more corporate persons or individuals selected from time to time by the Bank to serve as trustee or co-trustees of
the Trust Fund.

    	9

    	 

    

“Unallocated
Stock Fund” means that portion of the Stock Fund consisting of the Plan’s holding of Stock which have been acquired
in exchange for one or more Exempt Loans and which have not yet been allocated to the Participant’s Accounts in accordance
with Section 4.2.

“Uniformed
Service” means the performance of duty on a voluntary or involuntary basis in the uniformed service of the United States,
including the U.S. Public Health Services, under competent authority and includes active duty, active duty for training, initial
activity duty for training, inactive duty training, full-time National Guard duty, and the period for which a person is absent
from a position of employment for purposes of an examination to determine the fitness of the person to perform any such duty.

“Valuation
Date” means for so long as there is a generally recognized market for the Stock each business day. If at any time there
shall be no generally recognized market for the Stock, then “Valuation Date” shall mean the last day of the Plan Year
and each other date as of which the Committee shall determine the investment experience of the Investment Fund and adjust the Participants’
Accounts accordingly.

“Valuation
Period” means the period following a Valuation Date and ending with the next Valuation Date.

“Vesting
Year” means a unit of Service credited to a Participant pursuant to Section 9.2 for purposes of determining his vested
interest in his Account.

Section 3.Eligibility for
Participation.

3.1Initial
Eligibility. An Eligible Employee shall enter the Plan as of the Entry Date coincident with or next following the last
day of the Eligible Employee’s first Eligibility Year and attainment of age 18. Notwithstanding the foregoing, an Employee
who is an Eligible Employee on or prior to the Closing Date shall enter the Plan, retroactively, on the Effective Date.

3.2Definition
of Eligibility Year. “Eligibility Year” means an applicable eligibility period (as defined below) in which
the Eligible Employee has completed 1,000 Hours of Service for the Employer. For this purpose:

(i) an
Eligible Employee’s first “eligibility period” is the 12-consecutive month period beginning on the first day
on which he has an Hour of Service, including any years before the Effective Date of the Plan, and

(ii)his
subsequent eligibility periods will be 12-consecutive month periods beginning on each January 1 after that first day of Service.

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3.3Terminated
Employees. No Employee shall have any interest or rights under this Plan if he is never in active Service with an Employer
on or after the Effective Date.

3.4Certain
Employees Ineligible.

3.4-1.No
Employee shall participate in the Plan while his Service is covered by a collective bargaining agreement between an Employer and
the Employee’s collective bargaining representative if (i) retirement benefits have been the subject of good faith bargaining
between the Employer and the representative and (ii) the collective bargaining agreement does not provide for the Employee’s
participation in the Plan.

3.4-2.Employees
who are nonresident aliens with no earned income (within the meaning of Code Section 911(d)(2)) from the Employer which constitutes
income from sources within the United States (within the meaning of Code Section 861(a)(3)).

3.4-3.An
Eligible Employee may elect not to participate in the Plan, provided, however, such election is made solely to meet the requirements
of Code Section 409(n). For an election to be effective for a particular Plan Year, the Eligible Employee or Participant must file
the election in writing with the Committee no later than the last day of the Plan Year for which the election is to be effective.
The Employer may not make a contribution under the Plan for the Eligible Employee or for the Participant for the Plan Year for
which the election is effective, nor for any succeeding Plan Year, unless the Eligible Employee or Participant re-elects to participate
in the Plan. The Eligible Employee or Participant may elect again not to participate, but not earlier than the first Plan Year
following the Plan Year in which the re-election was first effective.

3.5Participation
and Reparticipation. Subject to the satisfaction of the foregoing requirements, an Eligible Employee shall participate
in the Plan during each period of his Service from the date on which he first becomes eligible until his termination. For this
purpose, an Eligible Employee who returns before five (5) consecutive one year Breaks in Service who previously satisfied the initial
eligibility requirements or who returns after five (5) consecutive one year Breaks in Service with a vested Account balance in
the Plan shall re-enter the Plan as of the date of his return to Service with an Employer.

3.6Omission
of Eligible Employee. If, in any Plan Year, any Eligible Employee who should be included as a Participant in the Plan is
erroneously omitted and discovery of such omission is not made until after a contribution by his Employer for the year has been
made, the Employer shall make a subsequent contribution with respect to the omitted Eligible Employee in the amount which the said
Employer would have contributed regardless of whether or not it is deductible in whole or in part in any taxable year under applicable
provisions of the Code.

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3.7Inclusion
of Ineligible Employee. If, in any Plan Year, any person who should not have been included as a Participant in the Plan
is erroneously included and discovery of such incorrect inclusion is not made until after a contribution for the year has been
made, the Employer shall not be entitled to recover the contribution made with respect to the ineligible person regardless of whether
or not a deduction is allowable with respect to such contribution. In such event, the amount contributed with respect to the ineligible
person shall constitute a forfeiture for the fiscal year in which the discovery is made. Any person who, after the close of a Plan
Year, is retroactively treated by the Company, an affiliated company or any other party as an Employee for such prior Plan Year
shall not, for purposes of the Plan, be considered an Employee for such prior Plan Year unless expressly so treated as such by
the Company.

Section 4.Contributions
and Credits.

4.1Discretionary
Contributions.

4.1-1.The
Employer shall from time to time contribute, with respect to a Plan Year, such amounts as it may determine from time to time. The
Employer shall have no obligation to contribute any amount under this Plan except as so determined in its sole discretion. The
Employer’s contributions and available forfeitures for a Plan Year shall be credited as of the last day of the year to the
Accounts of the Active Participants in the manner set forth in Section 8.1-2.

4.1-2.Upon
a Participant’s Reemployment After a Period of Uniformed Service, the Employer shall make an additional contribution on behalf
of such Participant that would have been made on his or her behalf during the Plan Year or Years corresponding to the Participant’s
Period of Uniformed Service.

4.2Contributions
for Exempt Loans. If the Trustee, upon instructions from the Committee, incurs any Exempt Loan upon the purchase of Stock,
the Employer may contribute for each Plan Year an amount sufficient to cover all payments of principal and interest as they come
due under the terms of the Exempt Loan. If there is more than one Exempt Loan, the Employer shall designate the one to which any
contribution is to be applied. Investment earnings realized on Employer contributions and any dividends paid by the Employer on
Stock held in the Unallocated Stock Account, shall be applied to the Exempt Loan related to that Stock, subject to Section 7.2.

In each Plan Year
in which Employer contributions, earnings on contributions, or dividends on Stock in the Unallocated Stock Fund are used as payments
under an Exempt Loan, a certain number of shares of the Stock acquired with that Exempt Loan which is then held in the Unallocated
Stock Fund shall be released for allocation among the Participants. The number of shares released shall bear the same ratio to
the total number of those shares then held in the Unallocated Stock Fund (prior to the release) as (i) the principal and interest
payments made on the Exempt Loan in the current Plan Year bears to (ii) the sum of (i) above, and the remaining principal and interest
payments required (or projected to be required on the basis of the interest rate in effect at the end of the Plan Year) to satisfy
the Exempt Loan.

At the direction
of the Committee, the current and projected payments of interest under an Exempt Loan may be ignored in calculating the number
of shares to be released in each year if (i) the Exempt Loan provides for annual payments of principal and interest at a cumulative
rate that is not less rapid at any time than level annual payments of such amounts for 10 years, (ii) the interest included in
any payment is ignored only to the extent that it would be determined to be interest under standard loan amortization tables, and
(iii) the term of the Exempt Loan, by reason of renewal, extension, or refinancing, has not exceeded 10 years from the original
acquisition of the Stock.

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4.3Conditions
as to Contributions. Employers’ contributions shall in all events be subject to the limitations set forth in Section
5. Contributions may be made in the form of cash, or securities and other property to the extent permissible under ERISA, including
Stock, and shall be held by the Trustee in accordance with the Trust Agreement. In addition to the provisions of Section 13.2 for
the return of an Employer’s contributions in connection with a failure of the Plan to qualify initially under the Code, any
amount contributed by an Employer due to a good faith mistake of fact, or based upon a good faith but erroneous determination of
its deductibility under Section 404 of the Code, shall be returned to the Employer within one year after the date on which the
contribution was originally made, or within one year after its nondeductibility has been finally determined. However, the amount
to be returned shall be reduced to take account of any adverse investment experience within the Trust Fund in order that the balance
credited to each Participant’s Account is not less that it would have been if the contribution had never been made.

4.4Rollover
Contributions. This Plan shall not accept a direct rollover or rollover contribution of an “eligible rollover distribution”
as such term is defined in Section 10.9-1 of the Plan.

Section 5.Limitations on
Contributions and Allocations.

5.1Limitation
on Annual Additions. Notwithstanding anything herein to the contrary, allocation of Employer contributions for any Plan
Year shall be subject to the following:

5.1-1If
allocation of Employer contributions in accordance with Section 4.1 will result in an allocation of more than one-third the total
contributions for a Plan Year to the accounts of Highly Compensated Employees, and such allocation would cause any Highly Compensated
Employee to exceed the limitations under Code Section 415(c) or the Employer to exceed the deduction limits under Code Section
404, then no more than one-third of the Employer contributions used for repayment of any Exempt Loan in accordance with Section
4.2 shall be allocated to the accounts of Highly Compensated Employees (within the meaning of Code Section 414(q)), with the remaining
Employer contributions to be made to non-Highly Compensated Employees in the manner specified under Section 8.1. Such adjustments
shall be made before any allocations occur.

5.1-2After
adjustment, if any, required by the preceding paragraph, the annual additions during any Plan Year to any Participant’s Account
under this and any other defined contribution plans maintained by the Employer or an affiliate (within the purview of Section 414(b),
(c) and (m) and Section 415(h) of the Code, which affiliate shall be deemed the Employer for this purpose) shall not exceed the
lesser of $51,000 (for 2013, or such other dollar amount which results from cost-of-living adjustments under Section 415(d) of
the Code) (the “dollar limitation”) or 100 percent of the Participant’s 415 Compensation for such limitation
year (the “percentage limitation”). In the event Stock is released from the Unallocated Stock Fund and allocated to
a Participant’s Account for a particular Plan Year, the Employer may determine for such year that an annual addition shall
be calculated on the basis of the fair market value of the Stock so released and allocated (such fair market value to be based
on the valuation as of the Valuation Date immediately preceding the Plan Year in respect of which the release and allocation are
made) if the annual addition, as so calculated, is lower than the annual addition calculated on the basis of Employer contributions.
The percentage limitation shall not apply to any contribution for medical benefits after severance from employment (within the
meaning of Section 401(h) or Section 419A(f)(2) of the Code) which is otherwise treated as an annual addition. If, as a result
of the allocation of forfeitures, a reasonable error in estimating a Participant’s annual compensation, a reasonable error
in determining the amount of elective deferrals (within the meaning of Code Section 402(g)(3)) that may be made with respect to
any individual under the limits of Code Section 415, or under other limited facts and circumstances that the Commissioner of the
Internal Revenue Service finds justify the availability of the rules set forth in this paragraph, the annual additions under the
terms of the Plan for a particular Participant would cause the limitations of Code Section 415 applicable to that Participant for
the limitation year to be exceeded, the Plan may only correct such excess in accordance with the Employee Plans Compliance Resolution
System (EPCRS) as set forth in Revenue Procedure 2008-50 or any subsequent guidance.

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5.1-3For
purposes of this Section 5.1, the “annual addition” to a Participant’s Accounts means the sum of (i) Employer
contributions, (ii) Employee contributions, if any, and (iii) forfeitures. For these purposes, annual additions to a defined contribution
plan shall not include the allocation of the excess amounts remaining in the Unallocated Stock Fund subsequent to a sale of stock
from such fund in accordance with a transaction described in Section 8.1 of the Plan. Notwithstanding the foregoing, “annual
additions” shall not include a restorative payment in accordance with Treasury Regulation Section 1.415(c)-1(b)(2)(C) that
is made to restore losses to the Plan resulting from actions by a fiduciary for which there is a reasonable risk of liability for
breach of fiduciary duty under ERISA or other applicable federal and state law.

In the event
Stock is released from the Unallocated Stock Fund and allocated to a Participant’s Account for a particular Plan Year, the
Employer may determine for such year that an annual addition shall be calculated on the basis of the fair market value of the Stock
so released and allocated (such fair market value to be based on the valuation as of the Valuation Date immediately preceding the
Plan Year in respect of which the release and allocation are made) if the annual addition, as so calculated, is lower than the
annual addition calculated on the basis of Employer contributions.

5.1-4Notwithstanding
the foregoing, if no more than one-third of the Employer contributions to the Plan for a year which are deductible under Section
404(a)(9) of the Code are allocated to Highly Compensated Employees (within the meaning of Section 414(q) of the Internal Revenue
Code), the limitations imposed herein shall not apply to:

(i)forfeitures
of Employer securities (within the meaning of Section 409 of the Code) under the Plan if such securities were acquired with the
proceeds of a loan described in Section 404(a)(9)(A) of the Code), or

(ii)Employer
contributions to the Plan which are deductible under Section 404(a)(9)(B) and charged against a Participant’s Account.

5.1-5If
the Employer contributes amounts, on behalf of Eligible Employees covered by this Plan, to other “defined contribution plans”
as defined in Section 3(34) of ERISA, the limitation on annual additions provided in this Section shall be applied to annual additions
in the aggregate to this Plan and to such other plans. Reduction of annual additions, where required, shall be accomplished first
by reductions under such other plan pursuant to the directions of the named fiduciary for administration of such other plans or
under priorities, if any, established under the terms of such other plans and then by allocating any remaining excess for this
Plan in the manner and priority set out above with respect to this Plan.

5.1-6A
limitation year shall mean each 12 consecutive month period ending on December 31.

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5.2Effect
of Limitations. The Committee shall take whatever action may be necessary from time to time to assure compliance with the
limitations set forth in Section 5.1. Specifically, the Committee shall see that each Employer restrict its contributions for any
Plan Year to an amount which, taking into account the amount of available forfeitures, may be completely allocated to the Participants
consistent with those limitations. Where the limitations would otherwise be exceeded by any Participant, further allocations to
the Participant shall be curtailed to the extent necessary to satisfy the limitations. Where an excessive amount is contributed
on account of a mistake as to one or more Participants’ compensation, or there is an amount of forfeitures which may not
be credited in the Plan Year in which it becomes available, the amount shall be corrected in accordance with Section 5.1-2 of the
Plan. If it is determined at any time that the Committee and/or Trustee has erred in accepting and allocating any contributions
or forfeitures under this Plan, or in allocating net gain or loss pursuant to Sections 8.2 and 8.3, then the Committee, in a uniform
and nondiscriminatory manner, shall determine the manner in which such error shall be corrected and shall promptly advise the Trustee
in writing of such error and of the method for correcting such error. The Accounts of any or all Participants may be revised, if
necessary, in order to correct such error.

5.3Limitations
as to Certain Participants. Aside from the limitations set forth in Section 5.1, if the Plan acquires any Stock in a transaction
as to which a selling shareholder or the estate of a deceased shareholder is claiming the benefit of Section 1042 of the Code,
the Committee shall see that none of such Stock, and no other assets in lieu of such Stock, are allocated to the Accounts of certain
Participants in order to comply with Section 409(n) of the Code.

This restriction
shall apply at all times to a Participant who owns (taking into account the attribution rules under Section 318(a) of the Code,
without regard to the exception for employee plan trusts in Section 318(a)(2)(B)(i) more than 25 percent of any class of stock
of a corporation which issued the Stock acquired by the Plan, or another corporation within the same controlled group, as defined
in Section 409(l)(4) of the Code (any such class of stock hereafter called a “Related Class”). For this purpose, a
Participant who owns more than 25 percent of any Related Class at any time within the one year preceding the Plan’s purchase
of the Stock shall be subject to the restriction as to all allocations of the Stock, but any other Participant shall be subject
to the restriction only as to allocations which occur at a time when he owns more than 25 percent of any Related Class.

Further, this restriction
shall apply to the selling shareholder claiming the benefit of Section 1042 and any other Participant who is related to such a
shareholder within the meaning of Section 267(b) of the Code, during the period beginning on the date of sale and ending on the
later of (1) the date that is ten years after the date of sale, or (2) the date of the Plan allocation attributable to the final
payment of acquisition indebtedness incurred in connection with the sale.

This restriction
shall not apply to any Participant who is a lineal descendant of a selling shareholder if the aggregate amounts allocated under
the Plan for the benefit of all such descendants do not exceed five percent of the Stock acquired from the shareholder.

    	15

    	 

    

5.4Erroneous
Allocations. No Participant shall be entitled to any annual additions or other allocations to his Account in excess of
those permitted under Section 5. If it is determined at any time that the administrator and/or Trustee have erred in accepting
and allocating any contributions or forfeitures under this Plan, or in allocating investment adjustments, or in excluding or including
any person as a Participant, then the administrator, in a uniform and nondiscriminatory manner, shall determine the manner in which
such error shall be corrected, after taking into consideration Sections 3.6 and 3.7 and any revenue procedure or other notice published
by the Internal Revenue Service regarding permissible correction methods, if applicable, and shall promptly advise the Trustee
in writing of such error and of the method for correcting such error. The Accounts of any or all Participants may be revised, if
necessary, in order to correct such error.

Section 6.Trust Fund and
Its Investment.

6.1Creation
of Trust Fund. All amounts received under the Plan from Employers and investments shall be held as the Trust Fund pursuant
to the terms of this Plan and of the Trust Agreement between the Bank and the Trustee. The benefits described in this Plan shall
be payable only from the assets of the Trust Fund, and none of the Bank, any other Employer, its board of directors or trustees,
its stockholders, its officers, its employees, the Committee, and the Trustee shall be liable for payment of any benefit under
this Plan except from the Trust Fund.

6.2Stock
Fund and Investment Fund. The Trust Fund held by the Trustee shall be divided into the Stock Fund, consisting entirely
of Stock, and the Investment Fund, consisting of all assets of the Trust other than Stock. The Trustee shall have no investment
responsibility for the Stock Fund, but shall accept any Employer contributions made in the form of Stock, and shall acquire, sell,
exchange, distribute, and otherwise deal with and dispose of Stock in accordance with the instructions of the Committee. As a directed
Trustee, the Trustee shall have such responsibility for the investment of the Investment Fund as set forth in Section .05 of the
Trust Agreement.

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6.3Acquisition
of Stock. From time to time the Committee may, in its sole discretion, direct the Trustee to acquire Stock from the issuing
Employer or from shareholders, including shareholders who are or have been Employees, Participants, or fiduciaries with respect
to the Plan. The Trustee shall pay for such Stock no more than its fair market value, which shall be determined conclusively by
the Committee pursuant to Section 12.4. The Committee may direct the Trustee to finance the acquisition of Stock by incurring or
assuming indebtedness to the seller or another party which indebtedness shall be called an “Exempt Loan.” The term
“Exempt Loan” shall refer to a loan made to the Plan by a disqualified person within the meaning of Section 4975(e)(2)
of the Code, or a loan to the Plan which is guaranteed by a disqualified person. An Exempt Loan includes a direct loan of cash,
a purchase-money transaction, and an assumption of an obligation of a tax-qualified employee stock ownership plan under Section
4975(e)(7) of the Code (“ESOP”). For these purposes, the term “guarantee” shall include an unsecured guarantee
and the use of assets of a disqualified person as collateral for a loan, even though the use of assets may not be a guarantee under
applicable state law. An amendment of an Exempt Loan in order to qualify as an “exempt loan” is not a refinancing of
the Exempt Loan or the making of another Exempt Loan. The term “exempt loan” refers to a loan that is primarily for
the benefit of the Plan participants and their beneficiaries and that satisfies the provisions of this paragraph. A “non-exempt
loan” fails to satisfy this paragraph. Any Exempt Loan shall be subject to the following conditions and limitations:

6.3-1All
Exempt Loans incurred by the Plan must be primarily for the benefit of Plan Participants and Beneficiaries, and an Exempt Loan
shall be for a specific term, shall not be payable on demand except in the event of default, and shall bear a reasonable rate of
interest, such that the interest rate and the price of the securities to be acquired with the Exempt Loan will not cause the Plan’s
assets to be inappropriately impaired in violation of Treasury Regulation Section 54.4975-7(b)(3).

6.3-2An
Exempt Loan may, but need not, be secured by a collateral pledge of either the Stock acquired in exchange for the Exempt Loan,
or the Stock previously pledged in connection with a prior Exempt Loan which is being repaid with the proceeds of the current Exempt
Loan. No other assets of the Plan and Trust may be used as collateral for an Exempt Loan, and no creditor under an Exempt Loan
shall have any right or recourse to any Plan and Trust assets other than Stock remaining subject to a collateral pledge.

6.3-3Any
pledge of Stock to secure an Exempt Loan must provide for the release of pledged Stock in connection with payments on the Exempt
Loans in the ratio prescribed in Section 4.2.

6.3-4Repayments
of principal and interest on any Exempt Loan shall be made by the Trustee only from Employer cash contributions designated for
such payments, from earnings on such contributions, and from cash dividends received on Stock, in the last case, however, subject
to the further requirements of Section 7.2. The payment on the Exempt Loan during the Plan Year must not exceed an amount equal
to the sum of contributions and earnings received during such year or prior to such year, less such payments in prior years. Such
contributions and earnings must be accounted for separately in the books and accounts of the Plan until the Exempt Loan is fully
repaid.

6.3-5In
the event of default of an Exempt Loan, the value of Plan assets transferred in satisfaction of the Exempt Loan must not exceed
the amount of the default. If the lender is a disqualified person within the meaning of Section 4975 of the Code, an Exempt Loan
must provide for a transfer of Plan assets upon default only upon and to the extent of the failure of the Plan to meet the payment
schedule of said Exempt Loan. For purposes of this paragraph, the making of a guarantee does not make a person a lender.

    	17

    	 

    

6.4Participants’
Option to Diversify. The Committee shall provide for a procedure under which each Participant may, during the qualified
election period, elect to “diversify” a portion of the Employer Stock allocated to his Account, as provided in Section
401(a)(28)(B) of the Code. An election to diversify must be made on the prescribed form and filed with the Committee within the
period specified herein. For each of the first five (5) Plan years in the qualified election period, the Participant may elect
to diversify an amount which does not exceed 25 percent of the number of shares allocated to his Account since the inception of
the Plan, less all shares with respect to which an election under this Section has already been made. For the last year of the
qualified election period, the Participant may elect to have up to 50 percent of the value of his Account committed to other investments,
less all shares with respect to which an election under this Section has already been made. The term “qualified election
period” shall mean the six (6) Plan Year period beginning with the first Plan Year in which a Participant has both attained
age 55 and completed 10 years of participation in the Plan. A Participant’s election to diversify his Account may be made
within each year of the qualified election period and shall continue for the 90-day period immediately following the last day of
each year in the qualified election period. Once a Participant makes such election, the Plan must complete diversification in accordance
with such election within 90 days after the end of the period during which the election could be made for the Plan Year. In the
discretion of the Committee, the Plan may satisfy the diversification requirement by any of the following methods:

6.4-1The
Plan may distribute all or part of the amount subject to the diversification election.

6.4-2         
The Plan may offer the Participant at least three other distinct investment options, if available
under the Plan. The other investment options shall satisfy the requirements of Regulations under Section 404(c) of the Employee
Retirement Income Security Act of 1974, as amended (“ERISA”).

6.4-3         
The Plan may transfer the portion of the Participant’s Account subject to the diversification
election to another qualified defined contribution plan of the Employer that offers at least three investment options satisfying
the requirements of the Regulations under Section 404(c) of ERISA.

Section 7.Voting Rights
and Dividends on Stock.

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7.1Voting
and Tendering of Stock.

7.1-1The
Trustee generally shall vote all shares of Stock held under the Plan in accordance with the written instructions of the Committee. 
However, if any Employer has a registration-type class of securities within the meaning of Section 409(e)(4) of the Code, or if
a matter submitted to the holders of the Stock involves a merger, consolidation, recapitalization, reclassification, liquidation,
dissolution, or sale of substantially all assets of an entity, then (i) the shares of Stock which have been allocated to Participants’
Accounts shall be voted by the Trustee in accordance with the Participants’ written instructions, and (ii) the Trustee shall
vote any unallocated Stock, allocated Stock for which it has received no voting instructions, and Stock for which Participants
vote to “abstain,” in the same proportions as it votes the allocated Stock for which it has received instructions from
Participants. In the event no shares of Stock have been allocated to Participants’ Accounts at the time Stock is to be voted
and any exempt loan which may be outstanding is not in default, each Participant shall be deemed to have one share of Stock allocated
to his or her Account for the sole purpose of providing the Trustee with voting instructions.

Notwithstanding
any provision hereunder to the contrary, all unallocated shares of Stock must be voted by the Trustee in a manner determined by
the Trustee to be for the exclusive benefit of the Participants and Beneficiaries. Whenever such voting rights are to be exercised,
the Employers shall provide the Trustee, in a timely manner, with the same notices and other materials as are provided to other
holders of the Stock, which the Trustee shall distribute to the Participants. The Participants shall be provided with adequate
opportunity to deliver their instructions to the Trustee regarding the voting of Stock allocated to their Accounts. The instructions
of the Participants’ with respect to the voting of allocated shares hereunder shall be confidential.

7.1-2In
the event of a tender offer, Stock shall be tendered by the Trustee in the same manner as set forth above with respect to the voting
of Stock. Notwithstanding any provision hereunder to the contrary, Stock must be tendered by the Trustee in a manner determined
by the Trustee to be for the exclusive benefit of the Participants and Beneficiaries.

7.2Application of Dividends.

7.2-1Stock
Dividends. Dividends on Stock which are received by the Trustee in the form of additional Stock shall be retained in the Stock
Fund, and shall be allocated among the Participants’ Accounts and the Unallocated Stock Fund in accordance with their holdings
of the Stock on which the dividends are paid.

7.2-2Cash
Dividends. The treatment of dividends paid in cash shall be determined after consideration to whether the cash dividends are
paid on Stock held in Participants’ Accounts or the Unallocated Stock Fund.

(i)On
Stock in Participants’ Accounts.

(A)Employer
Exercises Discretion. Dividends on Stock credited to Participants’ Accounts which are received by the Trustee in the
form of cash shall, at the direction of the Employer paying the dividends, either (I) be credited to the Accounts in accordance
with Section 8.4(iii) and invested as part of the Investment Fund, (II) be distributed immediately to the Participants in proportion
with the Participants’ Stock Fund Account balance (III) be distributed to the Participants within 90 days of the close of
the Plan Year in which paid in proportion with the Participants’ Stock Fund Account balance or (IV) be used to make payments
on the Exempt Loan. If dividends on Stock allocated to a Participant’s Account are used to repay the Exempt Loan, Stock with
a fair market value equal to the dividends so used must be allocated to such Participant’s Account in lieu of the dividends.

    	19

    	 

    

(B)Participant
Exercises Discretion over Dividend. In addition, in the sole discretion of the Employer, the Employer may grant Participants
the right to elect: (I) to have cash dividends paid on shares of Stock credited to such Participants’ Stock Fund Accounts
distributed to the Participant, or (II) to leave the cash dividends allocated to the Participant’s Account in the Plan, to
be credited to the Stock Fund Account and invested in shares of Stock. Dividends on which such election may be made will be fully
vested in the Participant (even if not otherwise vested, absent the ability to make such election). Accordingly, the Employer may
choose to offer this election only to Participants who are fully vested in their Account. In the event the Employer elects to give
Participants the right to determine the treatment of such dividends, the Participant’s election shall be made by filing with
the Committee the appropriate written direction as provided by the Committee at such time and in accordance with such procedures
and limitations which the Committee may from time to time establish; provided, however, that the procedures established by the
Committee shall provide a reasonable opportunity to change the election at least annually, may establish a default election if
a Participant fails to make an affirmative election within the time established for making elections, may provide that the election
is applicable for the Plan Year and cannot be revoked with respect to such Plan Year, shall otherwise be implemented in a manner
such that the dividends paid or reinvested will constitute “applicable dividends” which may be deducted under Code
Section 404(k), and are in accordance with applicable guidance issued or to be issued by the Secretary of the Treasury. If the
Employer elects to give Participants the right to exercise the discretion in this Paragraph 7.2-2(i)(B), the ability to make such
election shall be available to the Participant with respect to dividends paid for the entire Plan Year.

(ii)On
Stock in the Unallocated Stock Fund. Dividends received on shares of Stock held in the Unallocated Stock Fund shall be applied
to the repayment of principal and interest then due on the Exempt Loan used to acquire such shares. If the amount of dividends
exceeds the amount needed to repay such principal and interest (including any prepayments of principal and interest deemed advisable
by the Employer), then in the sole discretion of the Committee, the excess shall: (A) be allocated to Active Participants, pro
rata, in proportion to the Compensation of each such person that was earned during that portion of the Plan Year that such person
participated in the Plan compared to total Compensation of each Active Participant for such year, or (B) be deemed to be general
earnings of the Trust Fund and used for paying appropriate Plan or Trust related expenditures for the Plan Year. Notwithstanding
the foregoing, dividends paid on a share of Stock may not be used to make payments on a particular Exempt Loan unless the share
was acquired with the proceeds of such loan or a refinancing of such loan.

    	20

    	 

    

Section 8.Adjustments to
Accounts.

8.1ESOP
Allocations. Amounts available for allocation for a particular Plan Year will be divided into two categories. The first
category relates to shares of Stock released from the Unallocated Stock Fund attributable to using cash dividends to make Exempt
Loan payments. The second category relates to contributions made by the Employer, shares of Stock released from the Unallocated
Stock Fund on the basis of Employer contributions (or on the basis of the complete repayment of the Exempt Loan through the sale
or other disposition of Stock in the Unallocated Stock Fund) and amounts forfeited from Stock Fund Accounts pursuant to Section
9.5.

8.1-1Shares
of Stock attributable to the first category will be allocated to the Stock Fund Accounts of eligible Participants as follows:

(i)first,
if dividends paid on shares of Stock held in Participants’ Stock Fund Accounts are used to make payments on an Exempt Loan,
there shall be allocated to each such account a number of shares of Stock released from the Unallocated Stock Fund with a fair
market value (determined as of the Valuation Date coincident with or immediately preceding the loan payment date) that at
least equals the amount of dividends so used,

(ii)second,
if necessary, any remaining shares of Stock shall be applied to reinstate amounts forfeited from Stock Fund Accounts of former
employees who are entitled to a reinstatement under Section 9.5, and

(iii)finally,
any remaining shares of Stock shall be allocated as of the last Valuation Date of the Plan Year for which they are allocated in
the same manner as described in Section 8.1-2.

8.1-2Shares
of Stock or cash attributable to the second category (i.e., Employer contributions, Stock released from the Unallocated Stock Fund
on the basis of Employer contributions, amounts forfeited, and, to the extent applicable, shares of Stock released in accordance
with Section 8.1-1(iii)) will be allocated to the Stock Fund Accounts or Investment Fund Accounts, as the case may be, pro rata,
in proportion to the Compensation of each Active Participant that was earned by such Participant during the Plan Year compared
to total Compensation for all Active Participants earned during the Plan Year.

8.1-3Shares
of Stock or cash attributable to contributions made under Section 4.1-2 shall be allocated specifically to the Participants
on whose behalf such contributions were made.

    	21

    	 

    

8.2Charges
to Accounts. When a Valuation Date occurs, any distributions made to or on behalf of any Participant or Beneficiary since
the last preceding Valuation Date shall be charged to the proper Accounts maintained for that Participant or Beneficiary.

8.3Stock
Fund Account. Subject to the provisions of Sections 5 and 8.1, as of the last day of each Plan Year, the Trustee shall
credit to each Participant’s Stock Fund Account: (a) the Participant’s allocable share of Stock purchased by the Trustee
or contributed by the Employer to the Trust Fund for that year; (b) the Participant’s allocable share of the Stock that is
released from the Unallocated Stock Fund for that year; (c) the Participant’s allocable share of any forfeitures of Stock
arising under the Plan during that year; and (d) any stock dividends declared and paid during that year on Stock credited to the
Participant’s Stock Fund Account.

If, in any Plan
Year during which an outstanding Exempt Loan exists, the Employer directs the Trustee to sell or otherwise dispose of a number
of shares of Stock in the Unallocated Stock Fund sufficient to repay, in its entirety, the Exempt Loans, and following such repayment,
there remains Stock or other assets in the Unallocated Stock Fund, such Stock or other assets shall be allocated as of the last
day of the Plan Year in which the repayment occurred as earnings of the Plan to Active Participants, in proportion to the number
of shares held in Active Participants’ Stock Fund Accounts.

8.4Investment
Fund Account. Subject to the provisions of Sections 5 and 8.1 as of the last day of each Plan Year, the Trustee shall credit
to each Participant’s Investment Fund Account: (i) the Participant’s allocable share of any contribution for that year
made by the Employer in cash or in property other than Stock that is not used by the Trustee to purchase Employer Stock or to make
payments due under an Exempt Loan; (ii) the Participant’s allocable share of any forfeitures from the Investment Fund Accounts
of other Participants arising under the Plan during that year; (iii) any cash dividends paid during that year on Stock credited
to the Participant’s Stock Fund Account, other than dividends which are paid directly to the Participant and other than dividends
which are used to repay Exempt Loan; and (iv) the share of the net income or loss of the Trust Fund properly allocable to that
Participant’s Investment Fund Account, as provided in Section 8.5.

8.5Adjustment
to Value of Trust Fund. As of the last day of each Plan Year, the Trustee shall determine: (i) the net worth of that portion
of the Trust Fund which consists of properties other than Stock (the “Investment Fund”); and (ii) the increase or decrease
in the net worth of the Investment Fund since the last day of the preceding Plan Year. The net worth of the Investment Fund shall
be the fair market value of all properties held by the Trustee under the Trust Agreement other than Stock, net of liabilities other
than liabilities to Participants and their beneficiaries. The Trustee shall allocate to the Investment Fund Account of each Participant
that percentage of the increase or decrease in the net worth of the Investment Fund equal to the ratio which the balances credited
to the Participant’s Investment Fund Account bear to the total amount credited to all Participants’ Investments Fund
Accounts. This allocation shall be made after application of Section 7.2, but before application of Sections 8.1, 8.4 and 5.1.

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8.6Participant
Statements. Each Plan Year, the Committee shall provide or shall cause to be provided to each Participant a statement of
his or her Account balances, and the vested percentage thereof, as of the last day of the Plan Year.

Section 9.Vesting of Participants’
Interests.

9.1Vesting
in Accounts. A Participant’s vested interest in his Account shall be based on his Vesting Years in accordance with
the following table, subject to the balance of this Section 9:

	Vesting	Percentage of
	Years	Interest Vested
	 	 
	Fewer than 2	0%
	2	20%
	3	40%
	4	60%
	5	80%
	6 or more	100%

 

9.2Computation
of Vesting Years. For purposes of this Plan, a “Vesting Year” means generally a Plan Year in which an Eligible
Employee has performed at least 1,000 Hours of Service, beginning with the first Plan Year in which the Eligible Employee has completed
an Hour of Service with the Employer, and including Service with other Employers as provided in the definition of “Service.”
Notwithstanding the above, an Eligible Employee who was employed with the Bank shall receive credit for vesting purposes for each
calendar year of continuous employment with the Bank prior to the adoption of the Plan in which such Eligible Employee completed
1,000 Hours of Service (such years shall also be referred to as “Vesting Years”). However, a Participant’s Vesting
Years shall be computed subject to the following conditions and qualifications:

9.2-1A
Participant’s Vesting Years shall not include any Service prior to the date on which an Employee attains age 18.

9.2-2To
the extent applicable, a Participant’s vested interest in his Account accumulated before five (5) consecutive one year Breaks
in Service shall be determined without regard to any Service after such five consecutive Breaks in Service. Further, if a Participant
has five (5) consecutive one year Breaks in Service before his interest in his Account has become vested to some extent, pre-Break
in Service years of Service shall not be required to be taken into account for purposes of determining his post-Break in Service
vested percentage.

9.2-3To
the extent applicable, in the case of a Participant who has five (5) or more consecutive one year Breaks in Service, the Participant’s
pre-Break in Service will count in vesting of the Employer-derived post-Break in Service accrued benefit only if either:

(i)such
Participant has any nonforfeitable interest in the accrued benefit attributable to Employer contributions at the time of severance
from employment, or

(ii)upon
returning to Service the number of consecutive one year Breaks in Service is less than the number of years of Service.

9.2-4Notwithstanding
any provision of the Plan to the contrary, calculation of service for determining Vesting Years with respect to qualified military
service will be provided in accordance with Section 414(u) of the Code.

9.2-5To
the extent applicable, if any amendment changes the vesting schedule, including an automatic change to or from a top-heavy vesting
schedule, any Participant with three (3) or more Vesting Years may, by filing a written request with the Employer, elect to have
his vested percentage computed under the vesting schedule in effect prior to the amendment. The election period must begin not
later than the later of sixty (60) days after the amendment is adopted, the amendment becomes effective, or the Participant is
issued written notice of the amendment by the Employer or the Committee.

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9.3Full
Vesting Upon Certain Events.

9.3-1Notwithstanding
Section 9.1, a Participant’s interest in his Account shall fully vest on the Participant’s Normal Retirement Date.
The Participant’s interest shall also fully vest in the event that his Service is terminated by Disability or by death. For
purposes of this Section 9.3-1, benefits payable in the event of a Participant’s death or Disability while performing qualified
military service shall fully vest in accordance with Section 414(u)(9) of the Code.

9.3-2The
Participant’s interest in his Account shall also fully vest in the event of a “Change in Control” of the Bank,
or the Company. For these purposes “Change in Control” means a change in control of a nature that: (i) would be required
to be reported in response to Item 5.01 of the current report on Form 8-K, as in effect on the date hereof, pursuant to Section
13 or 15(d) of the Securities Exchange Act of 1934 (the “Exchange Act”); or (ii) results in a Change in Control of
the Bank or the Company within the meaning of the Bank Holding Company Act of 1956, as amended (“BHCA”); or (iii) without
limitation such a Change in Control shall be deemed to have occurred at such time as (a) any “person” (as the term
is used in Sections 13(d) and 14(d) of the Exchange Act) is or becomes the “beneficial owner” (as defined in Rule 13d-3
under the Exchange Act), directly or indirectly, of securities of the Company representing 25% or more of the combined voting power
of the Company’s outstanding securities, except for any securities purchased by the Bank’s employee stock ownership
plan or trust; or (b) individuals who constitute the Board of the Directors on the date hereof (the “Incumbent Board”)
cease for any reason to constitute at least a majority thereof, provided that any person becoming a director subsequent
to the date hereof whose election was approved by a vote of at least three-quarters of the directors comprising the Incumbent Board,
or whose nomination for election by the Company’s stockholders was approved by the same Nominating Committee serving under
an Incumbent Board, shall be, for purposes of this clause (b), considered as though he were a member of the Incumbent Board;
or (c) a plan of reorganization, merger, consolidation, sale of all or substantially all the assets of the Bank or the Company
or similar transaction in which the Bank or Company is not the surviving institution occurs or is effected; or (d) a proxy
statement soliciting proxies from stockholders of the Company is distributed, by someone other than the current management of the
Company, seeking stockholder approval of a plan of reorganization, merger or consolidation of the Company or similar transaction
with one or more business organizations as a result of which the outstanding shares of the class of securities then subject to
the plan are to be exchanged for or converted into cash or property or securities not issued by the Company; or (e) a tender
offer is made for 25% or more of the voting securities of the Company and the shareholders owning beneficially or of record 25%
or more of the outstanding securities of the Company have tendered or offered to sell their shares pursuant to such tender offer
and such tendered shares have been accepted by the tender offeror.

    	24

    	 

    

9.4Full
Vesting Upon Plan Termination. Notwithstanding Section 9.1, a Participant’s interest in his Account shall fully vest
upon termination of this Plan or upon the permanent and complete discontinuance of contributions by his Employer. In the event
of a partial termination, the interest of each affected Participant shall fully vest with respect to that part of the Plan which
is terminated. A partial termination of the Plan shall be determined by the Internal Revenue Service Commissioner based on the
facts and circumstances of the particular case in accordance with Code Section 411(d)(3) and the corresponding Treasury Regulations
issued thereunder.

9.5Forfeiture,
Repayment, and Restoral. If a Participant’s Service terminates before his interest in his Account is fully vested,
that portion which has not vested shall be forfeited after a one-year break in service. If a Participant’s Service terminates
prior to having any portion of his Account become vested, such Participant shall be deemed to have received a distribution of his
vested interest immediately upon his termination of Service.

If a Participant
who has suffered a forfeiture of the nonvested portion of his Account returns to Service before he has five (5) consecutive one-year
Breaks in Service, the nonvested portion shall be restored, provided that, if the Participant had received a distribution of his
vested Account balance, the amount distributed shall be repaid prior to such restoral. The Participant may repay such amount at
any time within five years after he has returned to Service. The amount repaid shall be credited to his Account at the time it
is repaid; an additional amount equal to that portion of his Account which was previously forfeited shall be restored to his Account
at the same time from other Employees’ forfeitures and, if such forfeitures are insufficient, then from amounts allocated
in accordance with Section 8.1-1(ii), and if insufficient, then from a special contribution by his Employer for that year. A Participant
who was deemed to have received a distribution of his vested interest in the Plan shall have his Account restored as of the first
day on which he performs an Hour of Service after his return.

In addition, if
a Participant did not receive a distribution of his vested Account balance but his non-vested Account balance was forfeited after
a one-year Break in Service, such nonvested Account balance shall be restored if the Plan terminates before the Participant has
a five-year Break in Service. If the Participant did not receive a distribution of his vested Account balance, any forfeiture restored
shall include earnings that would have been credited to the Account but for the forfeiture.

For purposes of
this Section and Section 5.1 of the Plan, if a portion of a Participant’s Account is forfeited, Stock allocated from an Exempt
Loan will be forfeited only after other assets. If interests in more than one class of Stock have been allocated to a Participant’s
Account, the Participant must be treated as forfeiting the same proportion of each such class.

    	25

    	 

    

9.6Accounting
for Forfeitures. If a portion of a Participant’s Account is forfeited, Stock allocated to said Participant’s
Account shall be forfeited only after other assets are forfeited. If interests in more than one class of Stock have been allocated
to a Participant’s Account, the Participant must be treated as forfeiting the same proportion of each class of Stock. A forfeiture
shall be charged to the Participant’s Account as of the first day of the first Valuation Period in which the forfeiture becomes
certain pursuant to Section 9.5. Except as otherwise provided in that Section, forfeitures may be applied to the payment of reasonable
administrative expenses of the Plan which are incurred in the year that the forfeitures arise, to the extent set forth in Section
14.4. Any forfeitures remaining after payment of reasonable administrative expenses shall be added to the contributions of the
terminated Participant’s Employer which are to be credited to other Participants pursuant to Section 4.1 as of the last day
of the Plan Year in which the forfeiture becomes certain.

9.7Vesting
and Nonforfeitability. A Participant’s interest in his Account which has become vested shall be nonforfeitable for
any reason.

Section 10.Payment of Benefits.

10.1Benefits
for Participants. For a Participant whose Service ends for any reason, distribution will be made to or for the benefit
of the Participant or, in the case of the Participant’s death, his Beneficiary, by payment in a lump sum, in accordance with
Section 10.2. Prior to any such distribution, any Participant entitled to a distribution will receive a form upon which the
Participant can elect the manner of such distribution (e.g., whether to receive the distribution directly or transfer such distribution
to an individual retirement account or other tax-qualified plan), a special tax notice regarding the consequences of such distribution,
and, if applicable, that the Participant has the right not to consent to a distribution at such time.

If a Participant
so desires, he may direct how his benefits are to be paid to his Beneficiary. Notice to the Participant with regard to having the
right to elect the manner in which his vested Account balance will be distributed to him may be given up to 180 days before the
first day of the first period for which an amount is payable. If a deceased Participant did not file a direction with the Committee,
the Participant’s benefits shall be distributed to his Beneficiary in a lump sum. Notwithstanding any provision to the contrary,
if the value of a Participant’s vested Account balance at the time of any distribution does not exceed $1,000, then such
Participant’s vested Account shall be distributed, without regard to whether the Participant consents, in a lump sum within
60 days after the end of the Plan Year in which employment terminates. If the value of a Participant’s vested Account balance
is in excess of $5,000, then his benefits shall not be paid prior to his Normal Retirement Date unless he elects an early payment
date in a written election filed with the Committee. A Participant may modify such an election at any time, provided any new benefit
payment date is at least 30 days after a modified election is delivered to the Committee. The Committee shall provide the Participant
with written notice designed to comply with the requirements of Code Section 411(a)(11), and shall provide the Participant with
a general description of the material features of the optional forms of benefits under the Plan and the right to defer receipt
of any distribution under the Plan. Such notice shall be provided no less than 30 days and no more than 180 days before the date
a distribution under the Plan commences. Notwithstanding the foregoing, failure of a Participant to consent to a distribution prior
his Normal Retirement Date shall be deemed to be an election to defer commencement of payment of any benefit under this section.
All distributions of $1,000 or less that are made pursuant to this Section without the Participant’s consent shall be made
in cash.

Notwithstanding
anything to the contrary, in the event the Participant dies while performing qualified military service (as defined Section 414(u)
of the Code), the Participant’s Beneficiary shall be entitled to any additional benefit provided under the Plan had the Participant
resumed and then severed from employment on account of death.

    	26

    	 

    

10.2Time
for Distribution.

10.2-1If
the Participant and, if applicable, with the consent of the Participant’s spouse, elects the distribution of the Participant’s
Account balance in the Plan, distribution shall commence as soon as practicable following his termination of Service, but no later
than one year after the close of the Plan Year in which the Participant severs employment by reason of attainment of Normal Retirement
Age under the Plan, Disability, or death, or which is the fifth Plan Year following the Plan Year in which the Participant otherwise
severs employment, except that this clause shall not apply if the Participant is reemployed by the Employer before distribution
is required to begin.

10.2-2Unless
the Participant elects otherwise, the distribution of the balance of a Participant’s Account shall commence not later than
the 60th day after the latest of the close of the Plan Year in which -

(i)the Participant
attains the age of 65;

(ii) occurs
the tenth anniversary of the year in which the Participant commenced participation in the Plan; or

(iii)the
Participant terminates his Service with the Employer.

10.2-3Notwithstanding
anything to the contrary, (1) with respect to a 5-percent owner (as defined in Code Section 416), distribution of a Participant’s
Account shall commence (whether or not he remains in the employ of the Employer) not later than the April 1 of the calendar year
next following the calendar year in which the Participant attains age 701⁄2, and (2) with respect to all other Participants,
payment of a Participant’s benefit will commence not later than April 1 of the calendar year following the calendar year
in which the Participant attains age 701⁄2, or, if later, the year in which the Participant retires. A Participant’s
benefit from that portion of his Account committed to the Investment Fund shall be calculated on the basis of the most recent Valuation
Date before the date of payment.

10.2-4Distribution
of a Participant’s Account balance after his death shall comply with the following requirements:

(i)If a
Participant dies before his distributions have commenced, distribution of his Account to his Beneficiary shall commence not later
than one year after the end of the Plan Year in which the Participant died; however, if the Participant’s Beneficiary is
his surviving Spouse, distributions may commence on the date on which the Participant would have attained age 701⁄2.
In either case, distributions shall be completed within five years after they commence.

    	27

    	 

    

(ii)If the
Participant dies after distribution has commenced pursuant to Section 10.1 but before his entire interest in the Plan has been
distributed to him, then the remaining portion of that interest shall, in accordance with Section 401(a)(9) of the Code, be distributed
at least as rapidly as under the method of distribution being used under Section 10.1 at the date of his death.

(iii)If
a married Participant dies before his benefit payments begin, then the Committee shall cause the balance in his Account to be paid
to his Beneficiary, provided, however, that no election by a married Participant of a different Beneficiary than his surviving
Spouse shall be valid unless the election is accompanied by the Spouse’s written consent, which (A) must acknowledge the
effect of the election, (B) must explicitly provide either that the designated Beneficiary may not subsequently be changed by the
Participant without the Spouse’s further consent, or that it may be changed without such consent, and (C) must be witnessed
by the Committee, its representative, or a notary public. This requirement shall not apply if the Participant establishes to the
Committee’s satisfaction that the Spouse may not be located.

10.2-5 If
a Participant or any other distributee’s distribution is rolled over to another eligible retirement plan following the Participant’s
required beginning date (as determined in accordance with Section 10.2-3), only the amount that exceeds the required minimum distribution
amount for the Plan Year (as determined in accordance with Code Section 401(a)(9)) in which the rollover is completed is treated
as an eligible rollover distribution for purposes of Section 10.9.

10.2-6All
distributions under this section shall be determined and made in accordance with Code Section 401(a)(9) and final Treasury Regulations
Sections 1.401(a)(9)-1 through 1.401(a)(9)-9, including the minimum distribution incidental benefit requirements of Code Section
401(a)(9)(G). These provisions override any distribution options in the Plan inconsistent with Code Section 401(a)(9).

    	28

    	 

    

10.3Marital
Status. The Committee, the Plan, the Trustee, and the Employers shall be fully protected and discharged from any liability
to the extent of any benefit payments made as a result of the Committee’s good faith and reasonable reliance upon information
obtained from a Participant and his Employer as to his marital status.

10.4Delay
in Benefit Determination. If the Committee is unable to determine the benefits payable to a Participant or Beneficiary
on or before the latest date prescribed for payment pursuant to Section 10.1 or 10.2, the benefits shall in any event be paid within
60 days after they can first be determined, with whatever makeup payments may be appropriate in view of the delay.

10.5Accounting
for Benefit Payments. Any benefit payment shall be charged to the Participant’s Account as of the first day of the
Valuation Period in which the payment is made.

10.6Options
to Receive Stock. Unless ownership of virtually all Stock is restricted to active Employees and qualified retirement plans
for the benefit of Employees pursuant to the certificates of incorporation or by-laws of the Employers issuing Stock, a terminated
Participant or the Beneficiary of a deceased Participant may instruct the Committee to distribute the Participant’s entire
vested interest in his Account in the form of Stock. In that event, the Committee shall apply the Participant’s vested interest
in the Investment Fund to purchase sufficient Stock from the Stock Fund or from any owner of Stock to make the required distribution.
In all other cases, other than as specifically set forth in Section 10.1, the Participant’s vested interest in the Stock
Fund shall be distributed in shares of Stock, and his vested interest in the Investment Fund shall be distributed in cash. If Stock
acquired with the proceeds of an Exempt Loan available for distribution consist of more than one class of Stock, the Participant
(or Beneficiary, if applicable) must receive substantially the same proportion of each such class.

Any Participant
who receives Stock pursuant to Section 10.1, and any person who has received Stock from the Plan or from such a Participant by
reason of the Participant’s death or incompetence, by reason of divorce or separation from the Participant, or by reason
of a rollover contribution described in Section 402(a)(5) of the Code, shall have the right to require the Employer which issued
the Stock to purchase the Stock for its current fair market value (hereinafter referred to as the “put right”). The
put right shall be exercisable by written notice to the Committee during the first 60 days after the Stock is distributed by the
Plan, and, if not exercised in that period, during the first 60 days in the following Plan Year after the Committee has communicated
to the Participant its determination as to the Stock’s current fair market value. However, the put right shall not apply
to the extent that the Stock, at the time the put right would otherwise be exercisable, may be sold on an established market in
accordance with federal and state securities laws and regulations. Similarly, the put option shall not apply with respect to the
portion of a Participant’s Account which the Employee elected to have reinvested under Code Section 401(a)(28)(B). If the
put right is exercised, the Trustee may, if so directed by the Committee in its sole discretion, assume the Employer’s rights
and obligations with respect to purchasing the Stock. Notwithstanding anything herein to the contrary, in the case of a plan established
by a bank (as defined in Code Section 581), the put option shall not apply if prohibited by a federal or state law and Participants
are entitled to elect their benefits be distributed in cash.

    	29

    	 

    

The Employer or
the Trustee, as the case may be, may elect to pay for the Stock in equal periodic installments, not less frequently than annually,
over a period beginning not later than 30 days after the exercise of the put right and not exceeding five years, with adequate
security and interest at a reasonable rate on the unpaid balance, all such terms to be set forth in a promissory note delivered
to the seller with normal terms as to acceleration upon any uncured default.

Nothing contained
herein shall be deemed to obligate any Employer to register any Stock under any federal or state securities law or to create or
maintain a public market to facilitate the transfer or disposition of any Stock. The put right described herein may only be exercised
by a person described in the second preceding paragraph, and may not be transferred with any Stock to any other person. As to all
Stock purchased by the Plan in exchange for any Exempt Loan, the put right shall be nonterminable. The put right for Stock acquired
through an Exempt Loan shall continue with respect to such Stock after the Exempt Loan is repaid or the Plan ceases to be an employee
stock ownership plan. Notwithstanding anything in the Plan to the contrary, if securities acquired with the proceeds of an Exempt
Loan available for distribution consist of more than one class, a distributee must receive substantially the same proportion of
each such class, in accordance with Treasury Regulations Section 54.4975-11(f)(2).

10.7Restrictions
on Disposition of Stock. Except in the case of Stock which is traded on an established market, a Participant who receives
Stock pursuant to Section 10.1, and any person who has received Stock from the Plan or from such a Participant by reason of the
Participant’s death or incompetence, by reason of divorce or separation from the Participant, or by reason of a rollover
contribution described in Section 402(a)(5) of the Code, shall, prior to any sale or other transfer of the Stock to any other person,
first offer the Stock to the issuing Employer and to the Plan at the greater of (i) its current fair market value, or (ii) the
purchase price offered in good faith by an independent third party purchaser. This restriction shall apply to any transfer, whether
voluntary, involuntary, or by operation of law, and whether for consideration or gratuitous. Either the Employer or the Trustee
may accept the offer within 14 days after it is delivered. Any Stock distributed by the Plan shall bear a conspicuous legend describing
the right of first refusal under this Section 10.7, as well as any other restrictions upon the transfer of the Stock imposed by
federal and state securities laws and regulations.

10.8Continuing
Loan Provisions; Creations of Protections and Rights. Except as otherwise provided in Sections 10.6 and 10.7 and this Section,
no shares of Employer Stock held or distributed by the Trustee may be subject to a put, call or other option, or buy-sell arrangement.
The provisions of this Section shall continue to be applicable to such Stock even if the Plan ceases to be an employee stock ownership
plan under Section 4975(e)(7) of the Code.

10.9Direct
Rollover of Eligible Distribution. A Participant or distributee may elect, at the time and in the manner prescribed by
the Trustee or the Committee, to have any portion of an eligible rollover distribution paid directly to an eligible retirement
plan specified by the Participant or distributee in a direct rollover.

10.9-1An
“eligible rollover” is any distribution that does not include: any distribution that is one of a series of substantially
equal periodic payments (not less frequently than annually) made for the life (or life expectancy) of the distributee or the joint
lives (or joint life expectancies) of the Participant and the Participant’s Beneficiary, or for a specified period of ten
years or more; any distribution to the extent such distribution is required under Code Section 401(a)(9); any hardship distribution
described in Section 401(k)(2)(B)(i)(IV) of the Code; and the portion of any distribution that is not included in gross income
(determined without regard to the exclusion for net unrealized appreciation with respect to employer securities). Notwithstanding
the foregoing, an “eligible rollover” shall include a distribution that is made to a “distributee” as defined
under Section 10.9-4.

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10.9-2An
“eligible retirement plan” is an individual retirement account described in Code Section 408(a), an individual retirement
annuity described in Code Section 408(b), a deemed individual retirement account described in Code Section 408(q), an annuity plan
described in Code Section 403(a), a Roth individual retirement account in accordance with Code Section 408A(e), or a qualified
trust described in Code Section 401(a), that accepts the distributee’s eligible rollover distribution. An eligible retirement
plan shall also include an annuity contract described in Section 403(b) of the Code and an eligible plan under Section 457(b) of
the Code which is maintained by a state, or any agency or instrumentality of a state or political subdivision of a state and which
agrees to separately account for amounts transferred into such plan from this Plan.

10.9-3A
“direct rollover” is a payment by the Plan to the eligible retirement plan specified by the distributee.

10.9-4The
term “distributee” shall refer to a deceased Participant’s Spouse or a Participant’s former Spouse who
is the alternate payee under a qualified domestic relations order, as defined in Code Section 414(p), and shall include non-Spouse
Beneficiaries pursuant to Code Section 402(c)(11).

10.9-5 The
Committee shall provide Participants or other distributes of eligible rollover distributions with a written notice designed to
comply with the requirements of Code Section 402(f). Such notice shall be provided within a reasonable period of time before making
an eligible rollover distribution. Such notice may be provided up to 180 days before the first day of the first period for which
an amount is payable.

10.10Waiver
of 30-Day Period After Notice of Distribution. If a distribution is one to which Sections 402(f) and 411(a)(11) of the
Code apply, such distribution may commence less than 30 days after the notice required under Section 1.402(f)-1 or 1.411(a)-11(c)
of the Treasury Regulations is given, provided that:

(i)the
Trustee or Committee, as applicable, clearly informs the Participant that the Participant has a right to a period of at least 30
days after receiving the notice to consider the decision of whether or not to elect to make a tax-free rollover or receive a taxable
distribution (and, if applicable, a particular form of distribution), and

(ii)the
Participant, after receiving the notice, affirmatively elects to make a tax-free rollover or receive a taxable distribution.

Section 11.Rules
Governing Benefit Claims and Review of Appeals.

    	31

    	 

    

11.1Claim
for Benefits. Any Participant or Beneficiary who qualifies for the payment of benefits shall file a claim for his benefits
with the Committee on a form provided by the Committee. The claim, including any election of an alternative benefit form, shall
be filed at least 30 days before the date on which the benefits are to begin. If a Participant or Beneficiary fails to file a claim
by the day before the date on which benefits become payable, he shall be presumed to have filed a claim for payment for the Participant’s
benefits in the standard form prescribed by Sections 10.1 or 10.2.

11.2Notification
by Committee. Within 90 days after receiving a claim for benefits (or within 180 days, if special circumstances require
an extension of time and written notice of the extension is given to the Participant or Beneficiary within 90 days after receiving
the claim for benefits), the Committee shall notify the Participant or Beneficiary whether the claim has been approved or denied.
If the Committee denies a claim in any respect, the Committee shall set forth in a written notice to the Participant or Beneficiary:

(i)each
specific reason for the denial;

(ii)specific
references to the pertinent Plan provisions on which the denial is based;

(iii)a
description of any additional material or information which could be submitted by the Participant or Beneficiary to support his
claim, with an explanation of the relevance of such information; and

(iv)an
explanation of the claims review procedures set forth in Section 11.3.

11.3Claims
Review Procedure. Within 60 days after a Participant or Beneficiary receives notice from the Committee that his claim for
benefits has been denied in any respect, he may file with the Committee a written notice of appeal setting forth his reasons for
disputing the Committee’s determination.  In connection with his appeal the Participant or Beneficiary or his representative
may inspect or purchase copies of pertinent documents and records to the extent not inconsistent with other Participants’
and Beneficiaries’ rights of privacy. Within 60 days after receiving a notice of appeal from a prior determination (or within
120 days, if special circumstances require an extension of time and written notice of the extension is given to the Participant
or Beneficiary and his representative within 60 days after receiving the notice of appeal), the Committee shall furnish to the
Participant or Beneficiary and his representative, if any, a written statement of the Committee’s final decision with respect
to his claim, including the reasons for such decision and the particular Plan provisions upon which it is based.

Section 12.The Committee
and its Functions.

12.1Authority
of Committee. The Committee shall be the “plan administrator” within the meaning of ERISA and shall have exclusive
responsibility and authority to control and manage the operation and administration of the Plan, including the interpretation and
application of its provisions, except to the extent such responsibility and authority are otherwise specifically (i) allocated
to the Bank, the Employers, or the Trustee under the Plan and Trust Agreement, (ii) delegated in writing to other persons by the
Bank, the Employers, the Committee, or the Trustee, or (iii) allocated to other parties by operation of law. The Committee shall
have exclusive responsibility regarding decisions concerning the payment of benefits under the Plan. The Committee shall have no
investment responsibility with respect to the Investment Fund except to the extent, if any, specifically provided in the Trust
Agreement. In the discharge of its duties, the Committee may employ accountants, actuaries, legal counsel, and other agents (who
also may be employed by an Employer or the Trustee in the same or some other capacity) and may pay their reasonable expenses and
compensation.

    	32

    	 

    

12.2Identity
of Committee. The Committee shall consist of three or more individuals selected by the Bank. Any individual, including
a director, trustee, shareholder, officer, or Employee of an Employer, shall be eligible to serve as a member of the Committee.
The Bank shall have the power to remove any individual serving on the Committee at any time without cause upon 10 days written
notice, and any individual may resign from the Committee at any time upon 10 days written notice to the Bank. The Bank shall notify
the Trustee of any change in membership of the Committee.

12.3Duties
of Committee. The Committee shall keep whatever records may be necessary to implement the Plan and shall furnish whatever
reports may be required from time to time by the Bank. The Committee shall furnish to the Trustee whatever information may be necessary
to properly administer the Trust. The Committee shall see to the filing with the appropriate government agencies of all reports
and returns required of the Plan under ERISA and other laws.

Further, the Committee
shall have exclusive responsibility and authority with respect to the Plan’s holdings of Stock and shall direct the Trustee
in all respects regarding the purchase, retention, sale, exchange, and pledge of Stock and the creation and satisfaction of Exempt
Loans. The Committee shall at all times act consistently with the Bank’s long-term intention that the Plan, as an employee
stock ownership plan, be invested primarily in Stock. In determining the proper extent of the Trust’s investment in Stock,
the Committee shall be authorized to employ investment counsel, legal counsel, appraisers, and other agents and to pay their reasonable
expenses and compensation.

12.4Valuation
of Stock. If the valuation of any Stock is not readily tradable on an established securities market, the valuation of such
Stock shall be determined by an independent appraiser. For purposes of the preceding sentence, the term “independent appraiser”
means any appraiser meeting requirements similar to the requirements of the regulations prescribed under Section 170(a)(1) of the
Code. The Valuation Date for all Plan transactions, including transactions between the Plan and a disqualified person, shall be
the date of the transaction, in accordance with Treasury Regulations Section 54.4975-11(d)(5).

12.5Compliance
with ERISA. The Committee shall perform all acts necessary to comply with ERISA. Each individual member or employee of
the Committee shall discharge his duties in good faith and in accordance with the applicable requirements of ERISA.

12.6Action
by Committee. All actions of the Committee shall be governed by the affirmative vote of a number of members which is a
majority of the total number of members currently appointed, including vacancies.

    	33

    	 

    

12.7Execution
of Documents. Any instrument executed by the Committee shall be signed by any member or employee of the Committee.

12.8Adoption
of Rules. The Committee shall adopt such rules and regulations of uniform applicability as it deems necessary or appropriate
for the proper administration and interpretation of the Plan.

12.9Responsibilities
to Participants. The Committee shall determine which Employees qualify to enter the Plan. The Committee shall furnish to
each Eligible Employee whatever summary plan descriptions, summary annual reports, and other notices and information may be required
under ERISA. The Committee also shall determine when a Participant or his Beneficiary qualifies for the payment of benefits under
the Plan. The Committee shall furnish to each such Participant or Beneficiary whatever information is required under ERISA (or
is otherwise appropriate) to enable the Participant or Beneficiary to make whatever elections may be available pursuant to Sections
6 and 10, and the Committee shall provide for the payment of benefits in the proper form and amount from the assets of the Trust
Fund. The Committee may decide in its sole discretion to permit modifications of elections and to defer or accelerate benefits
to the extent such decision is consistent with applicable law and made in a non-discriminatory manner and in the best interests
of all Participants and Beneficiaries.

12.10Alternative
Payees in Event of Incapacity. If the Committee finds at any time that an individual qualifying for benefits under this
Plan is a minor or is incompetent, the Committee may direct the benefits to be paid, in the case of a minor, to his parents, his
legal guardian, or a custodian for him under the Uniform Gifts to Minors Act, or, in the case of an incompetent, to his spouse,
or his legal guardian, the payments to be used for the individual’s benefit. The Committee and the Trustee shall not be obligated
to inquire as to the actual use of the funds by the person receiving them under this Section 12.10, and any such payment shall
completely discharge the obligations of the Plan, the Trustee, the Committee, and the Employers to the extent of the payment.

12.11Indemnification
by Employers. Except as separately agreed in writing, the Committee, and any member or employee of the Committee, shall
be indemnified and held harmless by the Employer, jointly and severally, to the fullest extent permitted by ERISA, and subject
to and conditioned upon compliance with 12 C.F.R. Section 545.121, to the extent applicable, against any and all costs, damages,
expenses, and liabilities reasonably incurred by or imposed upon it or him in connection with any claim made against it or him
or in which it or he may be involved by reason of its or his being, or having been, the Committee, or a member or employee of the
Committee, to the extent such amounts are not paid by insurance.

12.12Nonparticipation
by Interested Member. Any member of the Committee who also is a Participant in the Plan shall take no part in any determination
specifically relating to his own participation or benefits, unless his abstention would leave the Committee incapable of acting
on the matter.

    	34

    	 

    

Section 13.Adoption, Amendment,
or Termination of the Plan.

13.1Adoption
of Plan by Other Employers. With the consent of the Bank, any entity may become a participating Employer under the Plan
by (i) taking such action as shall be necessary to adopt the Plan, (ii) becoming a party to the Trust Agreement establishing the
Trust Fund, and (iii) executing and delivering such instruments and taking such other action as may be necessary or desirable to
put the Plan into effect with respect to the entity’s Employees.

13.2Plan
Adoption Subject to Qualification. Notwithstanding any other provision of the Plan, the adoption of the Plan and the execution
of the Trust Agreement are conditioned upon their being determined initially by the Internal Revenue Service to meet the qualification
requirements of Section 401(a) of the Code, so that the Employers may deduct currently for federal income tax purposes their contributions
to the Trust and so that the Participants may exclude the contributions from their gross income and recognize income only when
they receive benefits. In the event that this Plan is held by the Internal Revenue Service not to qualify initially under Section
401(a), the Plan may be amended retroactively to the earliest date permitted by U.S. Treasury Regulations in order to secure qualification
under Section 401(a). If this Plan is held by the Internal Revenue Service not to qualify initially under Section 401(a) either
as originally adopted or as amended, each Employer’s contributions to the Trust under this Plan (including any earnings thereon)
shall be returned to it and this Plan shall be terminated. In the event that this Plan is amended after its initial qualification
and the Plan as amended is held by the Internal Revenue Service not to qualify under Section 401(a), the amendment may be modified
retroactively to the earliest date permitted by U.S. Treasury Regulations in order to secure approval of the amendment under Section
401(a). In addition, reversions of Employer contributions (including earnings or losses attributable thereto) are permitted within
one year after the applicable determination date, if the reversion is due to a good faith mistake of fact.

13.3Right
to Amend or Terminate. The Bank intends to continue this Plan as a permanent program. However, each participating Employer
separately reserves the right to suspend, supersede, or terminate the Plan at any time and for any reason, as it applies to that
Employer’s Employees, and the Bank reserves the right to amend, suspend, supersede, merge, consolidate, or terminate the
Plan at any time and for any reason, as it applies to the Employees of each Employer. No amendment, suspension, supersession, merger,
consolidation, or termination of the Plan shall (i) reduce any Participant’s or Beneficiary’s proportionate interest
in the Trust Fund, (ii) reduce or restrict, either directly or indirectly, the benefit provided any Participant prior to the amendment,
or (iii) divert any portion of the Trust Fund to purposes other than the exclusive benefit of the Participants and their Beneficiaries
prior to the satisfaction of all liabilities under the Plan. Moreover, there shall not be any transfer of assets to a successor
plan or merger or consolidation with another plan unless, in the event of the termination of the successor plan or the surviving
plan immediately following such transfer, merger, or consolidation, each participant or beneficiary would be entitled to a benefit
equal to or greater than the benefit he would have been entitled to if the plan in which he was previously a participant or beneficiary
had terminated immediately prior to such transfer, merger, or consolidation. Following a termination of this Plan by the Bank,
the Trustee shall continue to administer the Trust and pay benefits in accordance with the Plan as amended from time to time and
the Committee’s instructions.

    	35

    	 

    

Section 14.Miscellaneous
Provisions.

14.1Plan
Creates No Employment Rights. Nothing in this Plan shall be interpreted as giving any Employee the right to be retained
as an Employee by an Employer, or as limiting or affecting the rights of an Employer to control its Employees or to terminate the
Service of any Employee at any time and for any reason, subject to any applicable employment or collective bargaining agreements.

14.2Nonassignability
of Benefits. No assignment, pledge, or other anticipation of benefits from the Plan will be permitted or recognized by
the Employer, the Committee, or the Trustee. Moreover, benefits from the Plan shall not be subject to attachment, garnishment,
or other legal process for debts or liabilities of any Participant or Beneficiary, to the extent permitted by law. This prohibition
on assignment or alienation shall apply to any judgment, decree, or order (including approval of a property settlement agreement)
which relates to the provision of child support, alimony, or property rights to a present or former spouse, child or other dependent
of a Participant pursuant to a state domestic relations or community property law, unless the judgment, decree, or order is determined
by the Committee to be a qualified domestic relations order within the meaning of Section 414(p) of the Code, as more fully set
forth in Section 14.12 hereof.

14.3Limit
of Employer Liability. The liability of the Employer with respect to Participants under this Plan shall be limited to making
contributions to the Trust from time to time, in accordance with Section 4.

14.4Treatment
of Expenses. All expenses incurred by the Committee and the Trustee in connection with administering this Plan and Trust
Fund shall be paid by the Trustee from the Trust Fund to the extent the expenses have not been paid or assumed by the Employer
or by the Trustee. The Committee may determine that, and shall inform the Trustee when, reasonable expenses may be charged directly
to the Account or Accounts of a Participant or group of Participants to whom or for whose benefit such expenses are allocable,
subject to the guidelines set forth in Field Assistance Bulletin 2003-03, to the extent not superseded, or any successor directive
issued by the Department of Labor.

14.5Number
and Gender. Any use of the singular shall be interpreted to include the plural, and the plural the singular. Any use of
the masculine, feminine, or neuter shall be interpreted to include the masculine, feminine, or neuter, as the context shall require.

14.6Nondiversion
of Assets. Except as provided in Sections 5.2 and 14.12, under no circumstances shall any portion of the Trust Fund
be diverted to or used for any purpose other than the exclusive benefit of the Participants and their Beneficiaries prior to the
satisfaction of all liabilities under the Plan.

14.7Separability
of Provisions. If any provision of this Plan is held to be invalid or unenforceable, the other provisions of the Plan shall
not be affected but shall be applied as if the invalid or unenforceable provision had not been included in the Plan.

    	36

    	 

    

14.8Service
of Process. The agent for the service of process upon the Plan shall be the president of the Bank, or such other person
as may be designated from time to time by the Bank.

14.9Governing
State Law. This Plan shall be interpreted in accordance with the laws of the State of Connecticut to the extent those laws
are applicable under the provisions of ERISA.

14.10Employer
Contributions Conditioned on Deductibility.  Employer Contributions to the Plan are conditioned on deductibility under
Code Section 404. In the event that the Internal Revenue Service shall determine that all or any portion of an Employer Contribution
is not deductible under that Section, the nondeductible portion shall be returned to the Employer within one year of the disallowance
of the deduction. In addition, reversions of Employer contributions (including earnings or losses attributable thereto) are permitted
within one year after the applicable determination date, if the reversion is due to a good faith mistake of fact. The maximum amount
that may be returned to the Employer in the case of a mistake of fact or the disallowance of a deduction is the excess of (1) the
amount contributed, over, as relevant, (2) (A) the amount that would have been contributed had no mistake of fact occurred, or
(B) the amount that would have been contributed had the contribution been limited to the amount that is deductible after any disallowance
by the Internal Revenue Service.

14.11Unclaimed
Accounts. Neither the Employer nor the Trustees shall be under any obligation to search for, or ascertain the whereabouts
of, any Participant or Beneficiary. The Employer or the Trustees, by certified or registered mail addressed to his last known address
of record with the Employer, shall notify any Participant or Beneficiary that he is entitled to a distribution under this Plan,
and the notice shall quote the provisions of this Section. If the Participant or Beneficiary fails to claim his benefits or make
his whereabouts known in writing to the Employer or the Trustees within seven (7) calendar years after the date of notification,
the benefits of the Participant or Beneficiary under the Plan will be disposed of as follows:

(i)If
the whereabouts of the Participant is unknown but the whereabouts of the Participant’s Beneficiary is known to the Trustees,
distribution will be made to the Beneficiary.

(ii)If
the whereabouts of the Participant and his Beneficiary are unknown to the Trustees, the Plan will forfeit the benefit, provided
that the benefit is subject to a claim for reinstatement if the Participant or Beneficiary make a claim for the forfeited benefit.

Any payment made
pursuant to the power herein conferred upon the Trustees shall operate as a complete discharge of all obligations of the Trustees,
to the extent of the distributions so made.

14.12Qualified
Domestic Relations Order. Section 14.2 shall not apply to a “qualified domestic relations order” defined in
Code Section 414(p), and such other domestic relations orders permitted to be so treated under the provisions of the Retirement
Equity Act of 1984. Further, to the extent provided under a “qualified domestic relations order,” a former Spouse of
a Participant shall be treated as the Spouse or surviving Spouse for all purposes under the Plan.

In the case of any
domestic relations order received by the Plan:

(i)The
Employer or the Committee shall promptly notify the Participant and any other alternate payee of the receipt of such order and
the Plan’s procedures for determining the qualified status of domestic relations orders, and

(ii)Within
a reasonable period after receipt of such order, the Employer or the Committee shall determine whether such order is a qualified
domestic relations order and notify the Participant and each alternate payee of such determination. The Employer or the Committee
shall establish reasonable procedures to determine the qualified status of domestic relations orders and to administer distributions
under such qualified orders.

During any period
in which the issue of whether a domestic relations order is a qualified domestic relations order is being determined (by the Employer
or Committee, by a court of competent jurisdiction, or otherwise), the Employer or the Committee shall segregate in a separate
account in the Plan or in an escrow account the amounts which would have been payable to the alternate payee during such period
if the order had been determined to be a qualified domestic relations order. If within eighteen (18) months the order (or modification
thereof) is determined to be a qualified domestic relations order, the Employer or the Committee shall pay the segregated amounts
(plus any interest thereon) to the person or persons entitled thereto. If within eighteen (18) months it is determined that the
order is not a qualified domestic relations order, or the issue as to whether such order is a qualified domestic relations order
is not resolved, then the Employer or the Committee shall pay the segregated amounts (plus any interest thereon) to the person
or persons who would have been entitled to such amounts if there had been no order. Any determination that an order is a qualified
domestic relations order which is made after the close of the eighteen (18) month period shall be applied prospectively only. The
term “alternate payee” means any Spouse, former Spouse, child or other dependent of a Participant who is recognized
by a domestic relations order as having a right to receive all, or a portion of, the benefit payable under a Plan with respect
to such Participant.

    	37

    	 

    

14.13Use
of Electronic Media to Provide Notices and Make Participant Elections. Pursuant to Treasury Regulations Section 1.401(a)-21,
the Plan may elect to use electronic media to provide notices required to be provided to Participants under the Plan and will accept
elections from Participants communicated to the Plan using such electronic media.  

14.14Acquisition
of Securities.  Notwithstanding any other provision of the Plan to the contrary, at no time shall the Plan be obligated
to acquire securities from a particular security holder at an indefinite time determined upon the happening of an event such as
the death of the security holder, pursuant to Treasury Regulations Section 54.4975-11(a)(7)(i).

Section 15.Top-Heavy Provisions.

15.1Top-Heavy
Plan. This Plan is top-heavy if any of the following conditions exist:

(i)If
the top-heavy ratio for this Plan exceeds sixty percent (60%) and this Plan is not part of any required aggregation group or permissive
aggregation group;

(ii)If
this Plan is a part of a required aggregation group (but is not part of a permissive aggregation group) and the aggregate top-heavy
ratio for the group of Plans exceeds sixty percent (60%); or

(iii)If
this Plan is a part of a required aggregation group and part of a permissive aggregation group and the aggregate top-heavy ratio
for the permissive aggregation group exceeds sixty percent (60%).

    	38

    	 

    

15.2Definitions.
In making this determination, the Committee shall use the following definitions and principles:

15.2-1The
“Determination Date,” with respect to the first Plan Year of any plan, means the last day of that Plan Year, and with
respect to each subsequent Plan Year, means the last day of the preceding Plan Year. If any other plan has a Determination Date
which differs from this Plan’s Determination Date, the top-heaviness of this Plan shall be determined on the basis of the
other plan’s Determination Date falling within the same calendar years as this Plan’s Determination Date.

15.2-2A
“Key Employee” means any employee or former employee (including any deceased employee) who at any time during the plan
year that includes the determination date was an officer of the employer having annual compensation greater than $160,000 (as adjusted
under section 416(i)(1) of the Code), a 5-percent owner of the employer, or a 1-percent owner of the employer having annual compensation
of more than $150,000. For this purpose, annual compensation means compensation within the meaning of section 415(c)(3) of the
Code. The determination of who is a key employee will be made in accordance with section 416(i)(1) of the Code and the applicable
regulations and other guidance of general applicability issued thereunder.

15.2-3A
“Non-key Employee” means an Employee who at any time during the five years ending on the top-heavy Determination Date
for the Plan Year has received compensation from an Employer and who has never been a Key Employee, and the Beneficiary of any
such Employee.

15.2-4A
“required aggregation group” includes (a) each qualified Plan of the Employer in which at least one Key Employee participates
in the Plan Year containing the Determination Date and (b) any other qualified Plan of the Employer which enables a Plan described
in (a) to meet the requirements of Code Sections 401(a)(4) or 410. For purposes of the preceding sentence, a qualified Plan of
the Employer includes a terminated Plan maintained by the Employer within the period ending on the Determination Date. In the case
of a required aggregation group, each Plan in the group will be considered a top-heavy Plan if the required aggregation group is
a top-heavy group. No Plan in the required aggregation group will be considered a top-heavy Plan if the required aggregation group
is not a top-heavy group. All Employers aggregated under Code Sections 414(b), (c) or (m) or (o) (but only after the Code Section
414(o) regulations become effective) are considered a single Employer.

15.2-5A
“permissive aggregation group” includes the required aggregation group of Plans plus any other qualified Plan(s) of
the Employer that are not required to be aggregated but which, when considered as a group with the required aggregation group,
satisfy the requirements of Code Sections 401(a)(4) and 410 and are comparable to the Plans in the required aggregation group.
No Plan in the permissive aggregation group will be considered a top-heavy Plan if the permissive aggregation group is not a top-heavy
group. Only a Plan that is part of the required aggregation group will be considered a top-heavy Plan if the permissive aggregation
group is top-heavy.

    	39

    	 

    

15.3Top-Heavy
Rules of Application. For purposes of determining the value of Account balances and the present value of accrued benefits
the following provisions shall apply:

15.3-1The
value of Account balances and the present value of accrued benefits will be determined as of the most recent Valuation Date that
falls within or ends with the twelve (12) month period ending on the Determination Date.

15.3-2For
purposes of testing whether this Plan is top-heavy, the present value of an individual’s accrued benefits and an individual’s
Account balances is counted only once each year.

15.3-3The
Account balances and accrued benefits of a Participant who is not presently a Key Employee but who was a Key Employee in a Plan
Year beginning on or after January 1, 1984 will be disregarded.

15.3-4Employer
contributions attributable to a salary reduction or similar arrangement will be taken into account. Employer matching contributions
also shall be taken into account for purposes of satisfying the minimum contribution requirements of Section 416(c)(2) of the Code
and the Plan.

15.3-5When
aggregating Plans, the value of Account balances and accrued benefits will be calculated with reference to the Determination Dates
that fall within the same calendar year.

15.3-6The
present values of accrued benefits and the amounts of account balances of an employee as of the determination date shall be increased
by the distributions made with respect to the employee under the plan and any plan aggregated with the plan under Section 416(g)(2)
of the Code during the 1-year period ending on the determination date. The preceding sentence shall also apply to distributions
under a terminated plan which, had it not been terminated, would have been aggregated with the plan under Section 416(g)(2)(A)(i)
of the Code. In the case of a distribution made for a reason other than severance from employment, death, or disability, this provision
shall be applied by substituting “five (5) year period” for “one (1) year period.”

15.3-7Accrued
benefits and Account balances of an individual shall not be taken into account for purposes of determining the top-heavy ratios
if the individual has performed no services for the Employer during the one (1) year period ending on the applicable Determination
Date. Compensation for purposes of this subparagraph shall not include any payments made to an individual by the Employer pursuant
to a qualified or non-qualified deferred compensation plan.

15.3-8The
present value of the accrued benefits or the amount of the Account balances of any Employee participating in this Plan shall not
include any rollover contributions or other transfers voluntarily initiated by the Employee except as described below. If this
Plan transfers or rolls over funds to another Plan in a transaction voluntarily initiated by the Employee, then this Plan shall
count the distribution for purposes of determining Account balances or the present value of accrued benefits. A transfer incident
to a merger or consolidation of two or more Plans of the Employer (including Plans of related Employers treated as a single Employer
under Code Section 414), or a transfer or rollover between Plans of the Employer, shall not be considered as voluntarily initiated
by the Employee.

    	40

    	 

    

15.4Minimum
Contributions. For any Top-Heavy Year, each Employer shall make a special contribution on behalf of each Participant to
the extent that the total allocations to his Account pursuant to Section 4 is less than the lesser of:

(i)three
percent of his 415 Compensation for that year, or

(ii)the
highest ratio of such allocation to 415 Compensation received by any Key Employee for that year.  For purposes of the special
contribution of this Section 15.2, a Key Employee’s 415 Compensation shall include amounts the Key Employee elected to defer
under a qualified 401(k) arrangement. Such a special contribution shall be made on behalf of each Participant who is employed by
an Employer on the last day of the Plan Year, regardless of the number of his Hours of Service, and shall be allocated to his Account.

If the Employer
maintains a qualified plan in addition to this Plan and more than one such plan is determined to be Top-Heavy, a minimum contribution
or a minimum benefit shall be provided in the other plan rather than in this Plan.

15.5Top-Heavy
Provisions Control in Top-Heavy Plan. In the event this Plan becomes top-heavy and a conflict arises between the top-heavy
provisions herein set forth and the remaining provisions set forth in this Plan, the top-heavy provisions shall control.

 

 

 

41SECURITIES PURCHASE AGREEMENT

This Securities
Purchase Agreement (this “Agreement”) is dated as of March 27, 2014, between Generex Biotechnology Corporation,
a Delaware corporation (the “Company”), and each purchaser identified on the signature pages hereto (each, including
its successors and assigns, a “Purchaser” and collectively, the “Purchasers”).

WHEREAS, subject
to the terms and conditions set forth in this Agreement and pursuant to Section 4(2) of the Securities Act of 1933, as amended
(the “Securities Act”), and Rule 506 promulgated thereunder, the Company desires to issue and sell to each Purchaser,
and each Purchaser, severally and not jointly, desires to purchase from the Company, securities of the Company as more fully described
in this Agreement.

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

ARTICLE I. 

DEFINITIONS

1.1             
Definitions. In addition to the terms defined elsewhere in this Agreement: (a) capitalized
terms that are not otherwise defined herein have the meanings given to such terms in the Certificate of Designation (as defined
herein), and (b) the following terms have the meanings set forth in this Section 1.1:

“Acquiring
Person” shall have the meaning ascribed to such term in Section 4.7.

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

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

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

“Business
Day” means any day except any Saturday, any Sunday, any day which is a federal legal holiday in the United States or
any day on which banking institutions in the State of New York are authorized or required by law or other governmental action to
close.

“Certificate
of Designation” means the Certificate of Designation to be filed prior to the Closing by the Company with the Secretary
of State of Delaware, in the form of Exhibit A attached hereto.

“Closing”
means the closing of the purchase and sale of the Securities pursuant to Section 2.1.

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

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

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

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

“Company
Counsel” means Eckert Seamans Cherin & Mellott, LLC, with offices located at50 S. 16th Two Liberty Place,
22nd Floor, Philadelphia, PA 19102.

“Conversion
Price” shall have the meaning ascribed to such term in the Certificate of Designation.

“Disclosure
Schedules” means the Disclosure Schedules of the Company delivered concurrently herewith.

“EGS”
means Ellenoff Grossman & Schole LLP, with offices located at 150 East 42nd Street, New York, New York 10017.

“Effective
Date” means the earliest of the date that (a) the initial Registration Statement has been declared effective by the Commission,
(b) all of the Registrable Securities have been sold pursuant to Rule 144 or may be sold pursuant to Rule 144 without the requirement
for the Company to be in compliance with the current public information required under Rule 144 and without volume or manner-of-sale
restrictions or (c) following the one year anniversary of the Closing Date provided that a holder of Registrable Securities is
not an Affiliate of the Company, all of the Registrable Securities may be sold pursuant to an exemption from registration under
Section 4(1) of the Securities Act without volume or manner-of-sale restrictions and Company counsel has delivered to such holders
a standing written unqualified opinion that resales may then be made by such holders of the Registrable Securities pursuant to
such exemption which opinion shall be in form and substance reasonably acceptable to such holders.

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

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

 

“Exempt
Issuance” means the issuance of (a) shares of Common Stock or options to employees, officers or directors of the Company
pursuant to any stock or option plan duly adopted for such purpose, by a majority of the non-employee members of the Board of Directors
or a majority of the members of a committee of non-employee directors established for such purpose, (b) shares of Common Stock
and/or Common Stock purchase options issued to the vendors identified in Schedule 3.1(g) hereto, in the periodic amounts
set forth therein, as applicable, provided that such securities have not been amended since the date of this Agreement to increase
the number of such securities or to decrease the exercise price, exchange price or conversion price of such securities, (c) shares
of Common Stock and/or Common Stock purchase options issued bona fide non-Affiliate vendors of
goods and services to the Company other than as set forth in Schedule 3.1 (g), not to exceed 1,000,000 shares, subject
to adjustment for reverse and forward stock splits and the like, in any calendar year, (d) securities upon the exercise or exchange
of or conversion of any Securities issued hereunder and/or other securities exercisable or exchangeable for or convertible into
shares of Common Stock issued and outstanding on the date of this Agreement, provided that such securities have not been amended
since the date of this Agreement to increase the number of such securities or to decrease the exercise price, exchange price or
conversion price of such securities, and (e) securities issued pursuant to acquisitions or strategic transactions approved by a
majority of the disinterested directors of the Company, provided that any such issuance shall only be to a Person (or to the equityholders
of a Person) which is, itself or through its subsidiaries, an operating company or an owner of an asset in a business synergistic
with the business of the Company and shall provide to the Company additional benefits in addition to the investment of funds, but
shall not include a transaction in which the Company is issuing securities primarily for the purpose of raising capital or to an
entity whose primary business is investing in securities.

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

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

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

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

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

“Intellectual
Property Rights” shall have the meaning ascribed to such term in Section 3.1(o).

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

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

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

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

“Maximum
Rate” shall have the meaning ascribed to such term in Section 5.17.

“Participation
Maximum” shall have the meaning ascribed to such term in Section 4.12(a).

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

“Pharmaceutical
Product” shall have the meaning ascribed to such term in Section 3.1(gg).

“Preferred
Stock” means the 4,150 shares of the Company’s 9% Series F Convertible Preferred Stock issued or issuable hereunder
having the rights, preferences and privileges set forth in the Certificate of Designation, in the form of Exhibit A hereto.

“Pre-Notice”
shall have the meaning ascribed to such term in Section 4.12(b).

“Pro
Rata Portion” shall have the meaning ascribed to such term in Section 4.12(e).

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

“Public
Information Failure” shall have the meaning ascribed to such term in Section 4.3(b).

“Public
Information Failure Payments” shall have the meaning ascribed to such term in Section 4.3(b).

“Purchaser
Party” shall have the meaning ascribed to such term in Section 4.10.

“Registration
Rights Agreement” means the Registration Rights Agreement, dated the date hereof, among the Company and the Purchasers,
in the form of Exhibit D attached hereto.

“Registration
Statement” means a registration statement meeting the requirements set forth in the Registration Rights Agreement and
covering the resale of the Underlying Shares by each Purchaser as provided for in the Registration Rights Agreement.

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

“Required
Minimum” means, as of any date, the maximum aggregate number of shares of Common Stock then issued or potentially issuable
in the future pursuant to the Transaction Documents, including any Underlying Shares issuable upon exercise in full of all Warrants
or conversion in full of all shares of Preferred Stock, ignoring any conversion or exercise limits set forth therein, and that
any previously unconverted shares of Preferred Stock are held until the third anniversary of the Closing Date.

“Rule
144” means Rule 144 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.

 

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

“Securities”
means the Preferred Stock, the Warrants, the Warrant Shares and the Underlying Shares.

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

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

“Stated
Value” means $1,000 per share of Preferred Stock.

“Subscription
Amount” means, as to each Purchaser, the aggregate amount to be paid for the Preferred Stock
and Warrants purchased hereunder as specified below such Purchaser’s name on the signature page of this Agreement and next
to the heading “Subscription Amount,” in United States dollars and in immediately available funds.

“Subsequent
Financing” shall have the meaning ascribed to such term in Section 4.12(a).

“Subsequent
Financing Notice” shall have the meaning ascribed to such term in Section 4.12(b).

“Subsidiary”
means any subsidiary of the Company as set forth on Schedule 3.1(a) and shall, where applicable, also include any direct
or indirect subsidiary of the Company formed or acquired after the date hereof.

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

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

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

“Transfer
Agent” means Broadridge Corporate Issuer Solutions, Inc., the current transfer agent of the Company, with a mailing address
of 44 West Lancaster Avenue, Ardmore, PA 19002 and a facsimile number of (610) 649 7302, and any successor transfer agent of the
Company.

“Underlying
Shares” means the shares of Common Stock issued and issuable upon conversion of the Preferred Stock and upon exercise
of the Warrants and issued and issuable in lieu of the cash payment of dividends on the Preferred Stock in accordance with the
terms of the Certificate of Designation.

“Variable
Rate Transaction” shall have the meaning ascribed to such term in Section 4.13(b).

“VWAP”
means, for any date, the price determined by the first of the following clauses that applies: (a) if the Common Stock is then listed
or quoted on a Trading Market, the daily volume weighted average price of the Common Stock for such date (or the nearest preceding
date) on the Trading Market on which the Common Stock is then listed or quoted as reported by Bloomberg L.P. (based on a Trading
Day from 9:30 a.m. (New York City time) to 4:02 p.m. (New York City time)), (b)  if the OTC Bulletin Board is not a Trading
Market, the volume weighted average price of the Common Stock for such date (or the nearest preceding date) on the OTC Bulletin
Board, (c) if the Common Stock is not then listed or quoted for trading on the OTC Bulletin Board and if prices for the Common
Stock are then reported in the “Pink Sheets” published by OTC Markets, Inc. (or a similar organization or agency succeeding
to its functions of reporting prices), the most recent bid price per share of the Common Stock so reported, or (d) in all
other cases, the fair market value of a share of Common Stock as determined by an independent appraiser selected in good faith
by the Purchasers of a majority in interest of the Securities then outstanding and reasonably acceptable to the Company, the fees
and expenses of which shall be paid by the Company.

“Warrants”
means, collectively, the Common Stock purchase warrants delivered to the Purchasers at the Closing in accordance with Section 2.2(a)
hereof, which Warrants shall be exercisable immediately and have a term of exercise equal to 5 years, in the form of Exhibit C
attached hereto.

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

ARTICLE II. 

PURCHASE AND SALE

2.1             
Closing. On the Closing Date, upon the terms and subject to the conditions set forth
herein, substantially concurrent with the execution and delivery of this Agreement by the parties hereto, the Company agrees to
sell, and the Purchasers, severally and not jointly, agree to purchase, an aggregate of $2,075,000 of shares of Preferred Stock
with an aggregate Stated Value for each Purchaser equal to such Purchaser’s Subscription Amount as set forth on the signature
page hereto executed by such Purchaser, and Warrants as determined by pursuant to Section 2.2(a). The aggregate number of shares
of Preferred Stock sold hereunder shall be 2,075. Each Purchaser shall deliver to the Company such Purchaser’s Subscription
Amount, and the Company shall deliver to each Purchaser its respective shares of Preferred Stock and Warrants, as determined pursuant
to Section 2.2(a), and the Company and each Purchaser shall deliver the other items set forth in Section 2.2 deliverable at the
Closing. Upon satisfaction of the covenants and conditions set forth in Sections 2.2 and 2.3, the Closing shall occur at the offices
of EGS or such other location as the parties shall mutually agree.

2.2             
Deliveries.

(a)               
On or prior to the Closing Date, the Company shall deliver or cause to be delivered to each
Purchaser the following:

		(i)	this Agreement duly executed by the Company;

(ii)              
a legal opinion of Company Counsel, substantially in the form of Exhibit B attached
hereto; 

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

(iv)            
a certificate evidencing a number of shares of Preferred Stock equal to such Purchaser’s
Subscription Amount divided by the Stated Value, registered in the name of such Purchaser and evidence of the filing and acceptance
of the Certificate of Designation from the Secretary of State of Delaware; and

(v)              
a Warrant registered in the name of such Purchaser to purchase up to a number of shares of
Common Stock equal to 100% of such Purchaser’s Subscription Amount divided by $0.03, with an exercise price equal to $0.03,
subject to adjustment therein (such Warrant certificate may be delivered within three Trading Days of the Closing Date).

(b)              
On or prior to the Closing Date, each Purchaser shall deliver or cause to be delivered to
the Company the following: 

		(i)	this Agreement duly executed by such Purchaser; 

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

(iii)            
such Purchaser’s Subscription Amount by wire transfer to the account specified in writing
by the Company.

2.3             
Closing Conditions. 

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

(i)                
the accuracy in all material respects on the Closing Date of the representations and warranties
of the Purchasers contained herein (unless as of a specific date therein in which case they shall be accurate as of such date);

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

(iii)            
the delivery by each Purchaser of the items set forth in Section 2.2(b) of this Agreement.

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

(i)                
the accuracy in all material respects when made and on the Closing Date of the representations
and warranties of the Company contained herein (unless as of a specific date therein);

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

(iii)            
the delivery by the Company of the items set forth in Section 2.2(a) of this Agreement; 

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

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

ARTICLE III. 

REPRESENTATIONS AND WARRANTIES

3.1             
Representations and Warranties of the Company. Except
as set forth in the SEC Reports or the Disclosure Schedules, which Disclosure Schedules shall be deemed a part hereof and shall
qualify any representation or otherwise made herein to the extent of the disclosure contained in the corresponding section of the
Disclosure Schedules, the Company hereby makes the following representations and warranties to each Purchaser:

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

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

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

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

(e)               
Filings, Consents and Approvals. The Company is not required to obtain any consent,
waiver, authorization or order of, give any notice to, or make any filing or registration with, any court or other federal, state,
local or other governmental authority or other Person in connection with the execution, delivery and performance by the Company
of the Transaction Documents, other than: (i) the filings required pursuant to Section 4.6 of this Agreement, (ii) the filing with
the Commission pursuant to the Registration Rights Agreement, (iii) the notice and/or application(s) to each applicable Trading
Market for the issuance and sale of the Preferred Stock and Warrant Shares and the listing of the Underlying Shares for trading
thereon in the time and manner required thereby and (iv) the filing of Form D with the Commission and such filings as are required
to be made under applicable state securities laws (collectively, the “Required Approvals”).

(f)               
Issuance of the Securities. The shares of Preferred Stock are duly authorized and,
when issued and paid for in accordance with the applicable Transaction Documents, will be duly and validly issued, fully paid and
nonassessable, free and clear of all Liens imposed by the Company. The Underlying Shares and Warrant Shares have been duly authorized
and, when issued in accordance with the terms of the Transaction Documents, will be validly issued, fully paid and nonassessable,
free and clear of all Liens imposed by the Company. The Company has reserved from its duly authorized capital stock a number of
shares of Common Stock for issuance of the Underlying Shares at least equal to the Required Minimum. 

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

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

(i)                
Material Changes; Undisclosed Events, Liabilities or Developments. Since the date of
the latest audited financial statements included within the SEC Reports, except as specifically disclosed in a subsequent SEC Report
filed prior to the date hereof: (i) there has been no event, occurrence or development that has had or that could reasonably be
expected to result in a Material Adverse Effect, (ii) the Company has not incurred any material liabilities (contingent or otherwise)
other than (A) trade payables and accrued expenses incurred in the ordinary course of business consistent with past practice and
(B) liabilities not required to be reflected in the Company’s financial statements pursuant to GAAP or disclosed in filings
made with the Commission, (iii) the Company has not altered its method of accounting, (iv) the Company has not declared or made
any dividend or distribution of cash or other property to its stockholders or purchased, redeemed or made any agreements to purchase
or redeem any shares of its capital stock and (v) the Company has not issued any equity securities to any officer, director or
Affiliate, except pursuant to existing Company stock option plans. The Company does not have pending before the Commission any
request for confidential treatment of information. Except for the issuance of the Securities contemplated by this Agreement or
as set forth on Schedule 3.1(i), no event, liability, fact, circumstance, occurrence or development has occurred or exists
or is reasonably expected to occur or exist with respect to the Company or its Subsidiaries or their respective businesses, properties,
operations, assets or financial condition, that would be required to be disclosed by the Company under applicable securities laws
at the time this representation is made or deemed made that has not been publicly disclosed at least 1 Trading Day prior to the
date that this representation is made.

(j)                
Litigation. Except as described in the SEC Reports, there is no action, suit, inquiry,
notice of violation, proceeding or investigation pending or, to the knowledge of the Company, threatened against or affecting the
Company, any Subsidiary or any of their respective properties before or by any court, arbitrator, governmental or administrative
agency or regulatory authority (federal, state, county, local or foreign) (collectively, an “Action”) which
(i) adversely affects or challenges the legality, validity or enforceability of any of the Transaction Documents or the Securities
or (ii) could, if there were an unfavorable decision, have or reasonably be expected to result in a Material Adverse Effect. Except
as set forth in the SEC Reports, since August 1, 2010, neither the Company nor any Subsidiary, nor any director or officer thereof,
is or has been the subject of any Action involving a claim of violation of or liability under federal or state securities laws
or a claim of breach of fiduciary duty. There has not been, and to the knowledge of the Company, there is not pending or contemplated,
any investigation by the Commission involving the Company or any current or former director or officer of the Company. The Commission
has not issued any stop order or other order suspending the effectiveness of any registration statement filed by the Company or
any Subsidiary under the Exchange Act or the Securities Act. 

(k)              
Labor Relations. No labor dispute exists or, to the knowledge of the Company, is imminent
with respect to any of the employees of the Company, which could reasonably be expected to result in a Material Adverse Effect.
None of the Company’s or its Subsidiaries’ employees is a member of a union that relates to such employee’s relationship
with the Company or such Subsidiary, and neither the Company nor any of its Subsidiaries is a party to a collective bargaining
agreement, and the Company and its Subsidiaries believe that their relationships with their employees are good. To the knowledge
of the Company, no executive officer of the Company or any Subsidiary, is, or is now expected to be, in violation of any material
term of any employment contract, confidentiality, disclosure or proprietary information agreement or non-competition agreement,
or any other contract or agreement or any restrictive covenant in favor of any third party, and the continued employment of each
such executive officer does not subject the Company or any of its Subsidiaries to any liability with respect to any of the foregoing
matters. The Company and its Subsidiaries are in compliance with all U.S. federal, state, local and foreign laws and regulations
relating to employment and employment practices, terms and conditions of employment and wages and hours, except where the failure
to be in compliance could not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.

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

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

(n)              
Title to Assets. Except as set forth on Schedule 3.1(n), the Company and the
Subsidiaries have good and marketable title in fee simple to all real property owned by them and good and marketable title in all
personal property owned by them that is material to the business of the Company and the Subsidiaries, in each case free and clear
of all Liens, except for (i) Liens as do not materially affect the value of such property and do not materially interfere with
the use made and proposed to be made of such property by the Company and the Subsidiaries and (ii) Liens for the payment of federal,
state or other taxes, for which appropriate reserves have been made in accordance with GAAP and, the payment of which is neither
delinquent nor subject to penalties. Any real property and facilities held under lease by the Company and the Subsidiaries are
held by them under valid, subsisting and enforceable leases with which the Company and the Subsidiaries are in compliance.

(o)              
Intellectual Property. The Company and the Subsidiaries have, or have rights to use,
all patents, patent applications, trademarks, trademark applications, service marks, trade names, trade secrets, inventions, copyrights,
licenses and other intellectual property rights and similar rights as described in the SEC Reports as necessary or required for
use in connection with their respective businesses and which the failure to so have could have a Material Adverse Effect (collectively,
the “Intellectual Property Rights”). None of, and neither the Company nor any Subsidiary has received a notice
(written or otherwise) that any of, the Intellectual Property Rights has expired, terminated or been abandoned, or is expected
to expire or terminate or be abandoned, within two (2) years from the date of this Agreement. Neither the Company nor any Subsidiary
has received, since the date of the latest audited financial statements included within the SEC Reports, a written notice of a
claim or otherwise has any knowledge that the Intellectual Property Rights violate or infringe upon the rights of any Person, except
as could not have or reasonably be expected to not have a Material Adverse Effect. To the knowledge of the Company, all such Intellectual
Property Rights are enforceable and there is no existing infringement by another Person of any of the Intellectual Property Rights.
The Company and its Subsidiaries have taken reasonable security measures to protect the secrecy, confidentiality and value of all
of their intellectual properties, except where failure to do so could not, individually or in the aggregate, reasonably be expected
to have a Material Adverse Effect.

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

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

(r)                
Sarbanes-Oxley; Internal Accounting Controls. The Company and the Subsidiaries are
in compliance with any and all applicable requirements of the Sarbanes-Oxley Act of 2002 that are effective as of the date hereof,
and any and all applicable rules and regulations promulgated by the Commission thereunder that are effective as of the date hereof
and as of the Closing Date. The Company and the Subsidiaries maintain a system of internal accounting
controls sufficient to provide reasonable assurance that: (i) transactions are executed in accordance with management’s general
or specific authorizations, (ii) transactions are recorded as necessary to permit preparation of financial statements in conformity
with GAAP and to maintain asset accountability, (iii) access to assets is permitted only in accordance with management’s
general or specific authorization, and (iv) the recorded accountability for assets is compared with the existing assets at reasonable
intervals and appropriate action is taken with respect to any differences. The Company and the Subsidiaries have established disclosure
controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the Company and the Subsidiaries and designed
such disclosure controls and procedures to ensure that information required to be disclosed by the Company in the reports it files
or submits under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the Commission’s
rules and forms. The Company’s certifying officers have evaluated the effectiveness of the disclosure controls and procedures
of the Company and the Subsidiaries as of the end of the period covered by the most recently filed periodic report under the Exchange
Act (such date, the “Evaluation Date”). The Company presented in its most recently filed periodic report under
the Exchange Act the conclusions of the certifying officers about the effectiveness of the disclosure controls and procedures based
on their evaluations as of the Evaluation Date. Since the Evaluation Date, there have been no changes in the internal control over
financial reporting (as such term is defined in the Exchange Act) of the Company and its Subsidiaries that have materially affected,
or is reasonably likely to materially affect, the internal control over financial reporting of the Company and its Subsidiaries.

(s)               
Certain Fees. No brokerage or finder’s fees or commissions are or will be payable
by the Company or any Subsidiary to any broker, financial advisor or consultant, finder, placement agent, investment banker, bank
or other Person with respect to the transactions contemplated by the Transaction Documents. The Purchasers shall have no obligation
with respect to any fees or with respect to any claims made by or on behalf of other Persons for fees of a type contemplated in
this Section that may be due in connection with the transactions contemplated by the Transaction Documents. 

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

(u)              
Registration Rights. No Person has any right to cause the Company or any Subsidiary
to effect the registration under the Securities Act of any securities of the Company or any Subsidiary.

(v)              
Listing and Maintenance Requirements. The Common Stock is registered pursuant to Section
12(b) or 12(g) of the Exchange Act, and the Company has taken no action designed to, or which to its knowledge is likely to have
the effect of, terminating the registration of the Common Stock under the Exchange Act nor has the Company received any notification
that the Commission is contemplating terminating such registration. The Company has not, in the 12 months preceding the date hereof,
received notice from any Trading Market on which the Common Stock is or has been listed or quoted to the effect that the Company
is not in compliance with the listing or maintenance requirements of such Trading Market. The Company is, and has no reason to
believe that it will not in the foreseeable future continue to be, in compliance with all such listing and maintenance requirements.

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

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

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

(z)               
Solvency. Based on the consolidated financial condition of the Company as of the Closing
Date, and the Company’s good faith estimate of the fair market value of its assets, after giving effect to the receipt by
the Company of the proceeds from the sale of the Securities hereunder: (i) the fair saleable value of the Company’s assets
exceeds the amount that will be required to be paid on or in respect of the Company’s existing debts and other liabilities
(including known contingent liabilities) as they mature, (ii) the Company’s assets do not constitute unreasonably small capital
to carry on its business as now conducted and as proposed to be conducted including its capital needs taking into account the particular
capital requirements of the business conducted by the Company, consolidated and projected capital requirements and capital availability
thereof, and (iii) the current cash flow of the Company, together with the proceeds the Company would receive, were it to liquidate
all of its assets, after taking into account all anticipated uses of the cash, would be sufficient to pay all amounts on or in
respect of its liabilities when such amounts are required to be paid. The Company does not intend to incur debts beyond its ability
to pay such debts as they mature (taking into account the timing and amounts of cash to be payable on or in respect of its debt).
The Company has no knowledge of any facts or circumstances which lead it to believe that it will file for reorganization or liquidation
under the bankruptcy or reorganization laws of any jurisdiction within one year from the Closing Date. Schedule 3.1(z) sets
forth as of the date hereof all outstanding secured and unsecured Indebtedness of the Company or any Subsidiary, or for which the
Company or any Subsidiary has commitments. For the purposes of this Agreement, “Indebtedness” means (x) any
liabilities for borrowed money or amounts owed in excess of $250,000 (other than trade accounts payable incurred in the ordinary
course of business), (y) all guaranties, endorsements and other contingent obligations in respect of indebtedness of others, whether
or not the same are or should be reflected in the Company’s consolidated balance sheet (or the notes thereto), except guaranties
by endorsement of negotiable instruments for deposit or collection or similar transactions in the ordinary course of business;
and (z) the present value of any lease payments in excess of $250,000 due under leases required to be capitalized in accordance
with GAAP. Neither the Company nor any Subsidiary is in default with respect to any Indebtedness.

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

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

(cc)           
Accountants. The Company’s accounting firm is set forth on Schedule 3.1(cc)
of the Disclosure Schedules. To the knowledge and belief of the Company, such accounting firm: (i) is a registered public accounting
firm as required by the Exchange Act and (ii) shall express its opinion with respect to the financial statements to be included
in the Company’s Annual Report for the fiscal year ending July 31, 2014.

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

(ee)           
Acknowledgment Regarding Purchaser’s Trading Activity.
Anything in this Agreement or elsewhere herein to the contrary notwithstanding (except for Sections 3.2(e) and 4.16 hereof), it
is understood and acknowledged by the Company that: (i) none of the Purchasers has been asked by the Company to agree, nor has
any Purchaser agreed, to desist from purchasing or selling, long and/or short, securities of the Company, or “derivative”
securities based on securities issued by the Company or to hold the Securities for any specified term, (ii) past or future open
market or other transactions by any Purchaser, specifically including, without limitation, Short Sales or “derivative”
transactions, before or after the closing of this or future private placement transactions, may negatively impact the market price
of the Company’s publicly-traded securities, (iii) any Purchaser, and counter-parties in “derivative” transactions
to which any such Purchaser is a party, directly or indirectly, may presently have a “short” position in the Common
Stock and (iv) each Purchaser shall not be deemed to have any affiliation with or control over any arm’s length counter-party
in any “derivative” transaction. The Company further understands and acknowledges
that (y) one or more Purchasers may engage in hedging activities at various times during the period that the Securities are outstanding,
including, without limitation, during the periods that the value of the Underlying Shares deliverable with respect to Securities
are being determined, and (z) such hedging activities (if any) could reduce the value of the existing stockholders' equity interests
in the Company at and after the time that the hedging activities are being conducted.  The Company acknowledges that such
aforementioned hedging activities do not constitute a breach of any of the Transaction Documents, provided that such activities
do not breach the Investors’ representations made in Section 3.2 of this Agreement.

(ff)            
Regulation M Compliance.  The Company has not, and to its knowledge no one acting
on its behalf has, (i) taken, directly or indirectly, any action designed to cause or to result in the stabilization or manipulation
of the price of any security of the Company to facilitate the sale or resale of any of the Securities, (ii) sold, bid for, purchased,
or paid any compensation for soliciting purchases of, any of the Securities, or (iii) paid or agreed to pay to any Person any compensation
for soliciting another to purchase any other securities of the Company, other than, in the case of clauses (ii) and (iii), compensation
paid to the Company’s placement agent in connection with the placement of the Securities.

(gg)          
FDA. As to each product subject to the jurisdiction of the U.S. Food and Drug Administration
(“FDA”) under the Federal Food, Drug and Cosmetic Act, as amended, and the regulations thereunder (“FDCA”)
that is manufactured, packaged, labeled, tested, distributed, sold, and/or marketed by the Company or any of its Subsidiaries (each
such product, a “Pharmaceutical Product”), such Pharmaceutical Product is being manufactured, packaged, labeled,
tested, distributed, sold and/or marketed by the Company in compliance with all applicable requirements under FDCA and similar
laws, rules and regulations relating to registration, investigational use, premarket clearance, licensure, or application approval,
good manufacturing practices, good laboratory practices, good clinical practices, product listing, quotas, labeling, advertising,
record keeping and filing of reports, except where the failure to be in compliance would not have a Material Adverse Effect. There
is no pending, completed or, to the Company's knowledge, threatened, action (including any lawsuit, arbitration, or legal or administrative
or regulatory proceeding, charge, complaint, or investigation) against the Company or any of its Subsidiaries, and none of the
Company or any of its Subsidiaries has received any notice, warning letter or other communication from the FDA or any other governmental
entity, which (i) contests the premarket clearance, licensure, registration, or approval of, the uses of, the distribution of,
the manufacturing or packaging of, the testing of, the sale of, or the labeling and promotion of any Pharmaceutical Product, (ii)
withdraws its approval of, requests the recall, suspension, or seizure of, or withdraws or orders the withdrawal of advertising
or sales promotional materials relating to, any Pharmaceutical Product, (iii) imposes a clinical hold on any clinical investigation
by the Company or any of its Subsidiaries, (iv) enjoins production at any facility of the Company or any of its Subsidiaries, (v)
enters or proposes to enter into a consent decree of permanent injunction with the Company or any of its Subsidiaries, or (vi)
otherwise alleges any violation of any laws, rules or regulations by the Company or any of its Subsidiaries, and which, either
individually or in the aggregate, would have a Material Adverse Effect. The properties, business
and operations of the Company have been and are being conducted in all material respects in accordance with all applicable laws,
rules and regulations of the FDA.  The Company has not been informed by the FDA that the FDA will prohibit the marketing,
sale, license or use in the United States of any product proposed to be developed, produced or marketed by the Company nor has
the FDA expressed any concern as to approving or clearing for marketing any product being developed or proposed to be developed
by the Company.

(hh)          
Stock Option Plans. Each stock option granted by the Company under the Company’s
stock option plan was granted (i) in accordance with the terms of the Company’s stock option plan and (ii) with an exercise
price at least equal to the fair market value of the Common Stock on the date such stock option would be considered granted under
GAAP and applicable law. No stock option granted under the Company’s stock option plan has been backdated. The Company has
not knowingly granted, and there is no and has been no Company policy or practice to knowingly grant, stock options prior to, or
otherwise knowingly coordinate the grant of stock options with, the release or other public announcement of material information
regarding the Company or its Subsidiaries or their financial results or prospects. 

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

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

(kk)          
Private Placement. Assuming the accuracy of the Purchasers’ representations and
warranties set forth in Section 3.2, no registration under the Securities Act is required for the offer and sale of the Securities
by the Company to the Purchasers as contemplated hereby. The issuance and sale of the Securities hereunder does not contravene
the rules and regulations of the Trading Market.

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

3.2             
Representations and Warranties of the Purchasers. Each Purchaser, for itself and for
no other Purchaser, hereby represents and warrants as of the date hereof and as of the Closing Date to the Company as follows (unless
as of a specific date therein):

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

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

(c)               
Purchaser Status. At the time such Purchaser was offered the Securities, it was, and
as of the date hereof it is, and on each date on which it exercises any Warrants or converts any shares of Preferred Stock it will
be either: (i) an “accredited investor” as defined in Rule 501(a)(1), (a)(2), (a)(3), (a)(7) or (a)(8) under the Securities
Act or (ii) a “qualified institutional buyer” as defined in Rule 144A(a) under the Securities Act. Such Purchaser is
not required to be registered as a broker-dealer under Section 15 of the Exchange Act.

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

(e)               
Certain Transactions and Confidentiality. Other than consummating the
transactions contemplated hereunder, such Purchaser has not directly or indirectly, nor has any Person acting on behalf of or pursuant
to any understanding with such Purchaser, executed any purchases or sales, including Short Sales, of the securities of the
Company during the period commencing as of the time that such Purchaser first received a term
sheet (written or oral) from the Company or any other Person representing the Company setting forth the material terms of the transactions
contemplated hereunder and ending immediately prior to the execution hereof. Notwithstanding
the foregoing, in the case of a Purchaser that is a multi-managed investment vehicle whereby separate portfolio managers manage
separate portions of such Purchaser’s assets and the portfolio managers have no direct knowledge of the investment decisions
made by the portfolio managers managing other portions of such Purchaser’s assets, the representation set forth above shall
only apply with respect to the portion of assets managed by the portfolio manager that made the investment decision to purchase
the Securities covered by this Agreement. Other than to other Persons party to this Agreement, such Purchaser has maintained the
confidentiality of all disclosures made to it in connection with this transaction (including the existence and terms of this transaction).
Notwithstanding the foregoing, for avoidance of doubt, nothing contained herein shall constitute a representation or warranty,
or preclude any actions, with respect to the identification of the availability of, or securing of, available shares to borrow
in order to effect Short Sales or similar transactions in the future.

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

 

ARTICLE IV. 

OTHER AGREEMENTS OF THE PARTIES

4.1 
Transfer Restrictions.

(a)               
The Securities may only be disposed of in compliance with state and federal securities laws.
In connection with any transfer of Securities other than pursuant to an effective registration statement or Rule 144, to the Company
or to an Affiliate of a Purchaser or in connection with a pledge as contemplated in Section 4.1(b), the Company may require the
transferor thereof to provide to the Company an opinion of counsel selected by the transferor and reasonably acceptable to the
Company, the form and substance of which opinion shall be reasonably satisfactory to the Company, to the effect that such transfer
does not require registration of such transferred Securities under the Securities Act. As a condition of transfer, any such transferee
shall agree in writing to be bound by the terms of this Agreement and the Registration Rights Agreement and shall have the rights
and obligations of a Purchaser under this Agreement and the Registration Rights Agreement.

(b)              
The Purchasers agree to the imprinting, so long as is required by this Section 4.1, of a legend
on any of the Securities in the following form:

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

The Company
acknowledges and agrees that a Purchaser may from time to time pledge pursuant to a bona fide margin agreement with a registered
broker-dealer or grant a security interest in some or all of the Securities to a financial institution that is an “accredited
investor” as defined in Rule 501(a) under the Securities Act and who agrees to be bound by the provisions of this Agreement
and the Registration Rights Agreement and, if required under the terms of such arrangement, such Purchaser may transfer pledged
or secured Securities to the pledgees or secured parties. Such a pledge or transfer would not be subject to approval of the Company
and no legal opinion of legal counsel of the pledgee, secured party or pledgor shall be required in connection therewith. Further,
no notice shall be required of such pledge. At the appropriate Purchaser’s expense, the Company will execute and deliver
such reasonable documentation as a pledgee or secured party of Securities may reasonably request in connection with a pledge or
transfer of the Securities, including, if the Securities are subject to registration pursuant to the Registration Rights Agreement,
the preparation and filing of any required prospectus supplement under Rule 424(b)(3) under the Securities Act or other applicable
provision of the Securities Act to appropriately amend the list of selling stockholders thereunder.

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

(d)              
In addition to such Purchaser’s other available remedies, the Company shall pay to a Purchaser, in cash, as partial
liquidated damages and not as a penalty, for each $1,000 of Underlying Shares (based on the VWAP of the Common Stock on the date
such Securities are submitted to the Transfer Agent) delivered for removal of the restrictive legend and subject to Section 4.1(c),
$10 per Trading Day (increasing to $20 per Trading Day five (5) Trading Days after such damages have begun to accrue) for each
Trading Day after the Legend Removal Date until such certificate is delivered without a legend. Nothing herein shall limit such
Purchaser’s right to pursue actual damages for the Company’s failure to deliver certificates representing any Securities
as required by the Transaction Documents, and such Purchaser shall have the right to pursue all remedies available to it at law
or in equity including, without limitation, a decree of specific performance and/or injunctive relief.

(e)               
Each Purchaser, severally and not jointly with the other Purchasers, agrees with the Company that such Purchaser will sell
any Securities pursuant to either the registration requirements of the Securities Act, including any applicable prospectus delivery
requirements, or an exemption therefrom, and that if Securities are sold pursuant to a Registration Statement, they will be sold
in compliance with the plan of distribution set forth therein, and acknowledges that the removal of the restrictive legend from
certificates representing Securities as set forth in this Section 4.1 is predicated upon the Company’s reliance upon this
understanding.

4.2             
Acknowledgment of Dilution. The Company acknowledges that the issuance of the Securities
may result in dilution of the outstanding shares of Common Stock, which dilution may be substantial under certain market conditions.
The Company further acknowledges that its obligations under the Transaction Documents, including, without limitation, its obligation
to issue the Underlying Shares pursuant to the Transaction Documents, are unconditional and absolute and not subject to any right
of set off, counterclaim, delay or reduction, regardless of the effect of any such dilution or any claim the Company may have against
any Purchaser and regardless of the dilutive effect that such issuance may have on the ownership of the other stockholders of the
Company.

4.3             
Furnishing of Information; Public Information. 

(a) Until
the earliest of the time that (i) no Purchaser owns Securities or (ii) the Warrants have expired, the Company covenants to maintain
the registration of the Common Stock under Section 12(b) or 12(g) of the Exchange Act and to timely file (or obtain extensions
in respect thereof and file within the applicable grace period) all reports required to be filed by the Company after the date
hereof pursuant to the Exchange Act even if the Company is not then subject to the reporting requirements of the Exchange Act.

(b) At
any time during the period commencing from the six (6) month anniversary of the date hereof and ending at such time that all of
the Securities may be sold without the requirement for the Company to be in compliance with Rule 144(c)(1) and otherwise without
restriction or limitation pursuant to Rule 144, if the Company shall fail for any reason to satisfy the current public information
requirement under Rule 144(c) (a “Public Information Failure”) then, in addition to such Purchaser’s other available
remedies, the Company shall pay to a Purchaser, in cash, as partial liquidated damages and not as a penalty, by reason of any such
delay in or reduction of its ability to sell the Securities, an amount in cash equal to two percent (2.0%) of the aggregate Stated
Value of Preferred Stock held by such Purchaser on the day of a Public Information Failure and on every thirtieth (30th) day (pro-rated
for periods totaling less than thirty days) thereafter until the earlier of (a) the date such Public Information Failure is cured
and (b) such time that such public information is no longer required for the Purchasers to transfer the Underlying Shares pursuant
to Rule 144. The payments to which a Purchaser shall be entitled pursuant to this Section 4.3(b) are referred to herein as “Public
Information Failure Payments.” Public Information Failure Payments shall be paid on the earlier of (i) the last day of
the calendar month during which such Public Information Failure Payments are incurred and (ii) the third (3rd) Business Day after
the event or failure giving rise to the Public Information Failure Payments is cured. In the event the Company fails to make Public
Information Failure Payments in a timely manner, such Public Information Failure Payments shall bear interest at the rate of 1.5%
per month (prorated for partial months) until paid in full. Nothing herein shall limit such Purchaser’s right to pursue actual
damages for the Public Information Failure, and such Purchaser shall have the right to pursue all remedies available to it at law
or in equity including, without limitation, a decree of specific performance and/or injunctive relief.

4.4             
Integration. The Company shall not sell, offer for sale or solicit offers to buy or
otherwise negotiate in respect of any security (as defined in Section 2 of the Securities Act) that would be integrated with the
offer or sale of the Securities in a manner that would require the registration under the Securities Act of the sale of the Securities
or that would be integrated with the offer or sale of the Securities for purposes of the rules and regulations of any Trading Market
such that it would require shareholder approval prior to the closing of such other transaction unless shareholder approval is obtained
before the closing of such subsequent transaction.

4.5             
Conversion and Exercise Procedures. Each of the form of Notice of Exercise included
in the Warrants and the form of Notice of Conversion included in the Certificate of Designation set forth the totality of the procedures
required of the Purchasers in order to exercise the Warrants or convert the Preferred Stock. No additional legal opinion, other
information or instructions shall be required of the Purchasers to exercise their Warrants or convert their Preferred Stock. The
Company shall honor exercises of the Warrants and conversions of the Preferred Stock and shall deliver Underlying Shares in accordance
with the terms, conditions and time periods set forth in the Transaction Documents.

4.6             
Securities Laws Disclosure; Publicity. The Company shall, prior to 4:00 p.m. (New York
City time) on the date hereof, issue a press release disclosing the material terms of the transactions contemplated hereby and
shall file a Current Report on Form 8-K, including the Transaction Documents as exhibits thereto, prior to 9:30 a.m. (New York
City time) on the Trading Day immediately following the date hereof. From and after the issuance of such press release, the Company
represents to the Purchasers that it shall have publicly disclosed all material, non-public information delivered to any of the
Purchasers by the Company or any of its Subsidiaries, or any of their respective officers, directors, employees or agents in connection
with the transactions contemplated by the Transaction Documents. The Company and each Purchaser shall consult with each other in
issuing any other press releases with respect to the transactions contemplated hereby, and neither the Company nor any Purchaser
shall issue any such press release nor otherwise make any such public statement without the prior consent of the Company, with
respect to any press release of any Purchaser, or without the prior consent of each Purchaser, with respect to any press release
of the Company, which consent shall not unreasonably be withheld or delayed, except if such disclosure is required by law, in which
case the disclosing party shall promptly provide the other party with prior notice of such public statement or communication. Notwithstanding
the foregoing, the Company shall not publicly disclose the name of any Purchaser, or include the name of any Purchaser in any filing
with the Commission or any regulatory agency or Trading Market, without the prior written consent of such Purchaser, except: (a)
as required by federal securities law in connection with the filing of final Transaction Documents with the Commission and (b)
to the extent such disclosure is required by law or Trading Market regulations, in which case the Company shall provide the Purchasers
with prior notice of such disclosure permitted under this clause (b).

4.7             
Shareholder Rights Plan. No claim will be made or enforced by the Company or, with
the consent of the Company, any other Person, that any Purchaser is an “Acquiring Person” under any control share acquisition,
business combination, poison pill (including any distribution under a rights agreement) or similar anti-takeover plan or arrangement
in effect or hereafter adopted by the Company, or that any Purchaser could be deemed to trigger the provisions of any such plan
or arrangement, by virtue of receiving Securities under the Transaction Documents or under any other agreement between the Company
and the Purchasers.

4.8             
Non-Public Information. Except with respect to the material terms and conditions of
the transactions contemplated by the Transaction Documents, the Company covenants and agrees that neither it, nor any other Person
acting on its behalf, will provide any Purchaser or its agents or counsel with any information that the Company believes constitutes
material non-public information, unless prior thereto such Purchaser shall have entered into a written agreement with the Company
regarding the confidentiality and use of such information. The Company understands and confirms that each Purchaser shall be relying
on the foregoing covenant in effecting transactions in securities of the Company.

4.9             
Use of Proceeds. Except as set forth on Schedule 4.9 attached hereto, the Company
shall use the net proceeds from the sale of the Securities hereunder for working capital purposes and shall not use such proceeds:
(a) for the satisfaction of any portion of the Company’s debt (other than payment of trade payables in the ordinary course
of the Company’s business and prior practices), (b) for the redemption of any Common Stock or Common Stock Equivalents, (c)
for the settlement of any outstanding litigation or (d) in violation of FCPA or OFAC regulations.

4.10         
Indemnification of Purchasers. Subject to the provisions of this Section 4.10, the
Company will indemnify and hold each Purchaser and its directors, officers, shareholders, members, partners, employees and agents
(and any other Persons with a functionally equivalent role of a Person holding such titles notwithstanding a lack of such title
or any other title), each Person who controls such Purchaser (within the meaning of Section 15 of the Securities Act and Section
20 of the Exchange Act), and the directors, officers, shareholders, agents, members, partners or employees (and any other Persons
with a functionally equivalent role of a Person holding such titles notwithstanding a lack of such title or any other title) of
such controlling persons (each, a “Purchaser Party”) harmless from any and all losses, liabilities, obligations,
claims, contingencies, damages, costs and expenses, including all judgments, amounts paid in settlements, court costs and reasonable
attorneys’ fees and costs of investigation that any such Purchaser Party may suffer or incur as a result of or relating to
(a) any breach of any of the representations, warranties, covenants or agreements made by the Company in this Agreement or in the
other Transaction Documents or (b) any action instituted against Purchaser Parties in any capacity, or any of them or their respective
Affiliates, by any stockholder of the Company who is not an Affiliate of such Purchaser Party, with respect to any of the transactions
contemplated by the Transaction Documents (unless such action is based upon a breach of such Purchaser Party’s representations,
warranties or covenants under the Transaction Documents or any agreements or understandings such Purchaser Party may have with
any such stockholder or any violations by such Purchaser Party of state or federal securities laws or any conduct by such Purchaser
Party which constitutes fraud, gross negligence, willful misconduct or malfeasance). If any action shall be brought against any
Purchaser Party in respect of which indemnity may be sought pursuant to this Agreement, such Purchaser Party shall promptly notify
the Company in writing, and the Company shall have the right to assume the defense thereof with counsel of its own choosing reasonably
acceptable to the Purchaser Party. Any Purchaser Party shall have the right to employ separate counsel in any such action and participate
in the defense thereof, but the fees and expenses of such counsel shall be at the expense of such Purchaser Party except to the
extent that (i) the employment thereof has been specifically authorized by the Company in writing, (ii) the Company has failed
after a reasonable period of time to assume such defense and to employ counsel or (iii) in such action there is, in the reasonable
opinion of counsel, a material conflict on any material issue between the position of the Company and the position of such Purchaser
Party, in which case the Company shall be responsible for the reasonable fees and expenses of no more than one such separate counsel.
The Company will not be liable to any Purchaser Party under this Agreement (y) for any settlement by a Purchaser Party effected
without the Company’s prior written consent, which shall not be unreasonably withheld or delayed; or (z) to the extent, but
only to the extent that a loss, claim, damage or liability is attributable to any Purchaser Party’s breach of its representations,
warranties or covenants under the Transaction Documents or any agreements or understandings such Purchaser Party may have with
any such stockholder or any violations by such Purchaser Party of state or federal securities laws or any conduct by such Purchaser
Party which constitutes fraud, gross negligence, willful misconduct or malfeasance. The indemnification required by this Section
4.10 shall be made by periodic payments of the amount thereof during the course of the investigation or defense, as and when bills
are received or are incurred. The indemnity agreements contained herein shall be in addition to any cause of action or similar
right of any Purchaser Party against the Company or others and any liabilities the Company may be subject to pursuant to law.

4.11         
Reservation and Listing of Securities.

(a)               
The Company shall maintain a reserve from its duly authorized shares of Common Stock for issuance
pursuant to the Transaction Documents in such amount as may then be required to fulfill its obligations in full under the Transaction
Documents.

(b)              
If, on any date following the date hereof, the number of authorized but unissued (and otherwise
unreserved) shares of Common Stock is less than the Required Minimum on such date, then the Board of Directors shall use commercially
reasonable efforts to amend the Company’s certificate or articles of incorporation to increase the number of authorized but
unissued shares of Common Stock to at least the Required Minimum at such time, as soon as possible and in any event not later than
the 75th day after such date.

(c)               
The Company shall, if applicable: (i) in the time and manner required by the principal Trading
Market, prepare and file with such Trading Market an additional shares listing application covering a number of shares of Common
Stock at least equal to the Required Minimum on the date of such application, (ii) take all steps necessary to cause such shares
of Common Stock to be approved for listing or quotation on such Trading Market as soon as possible thereafter, (iii) provide to
the Purchasers evidence of such listing or quotation and (iv) maintain the listing or quotation of such Common Stock on any date
at least equal to the Required Minimum on such date on such Trading Market or another Trading Market. 

4.12         
Participation in Future Financing. 

(a)               
Subject only to the rights of investors party to that certain securities purchase agreements
dated June 17, 2013 and January 14, 2014, from the date hereof until the date that is the 12 month anniversary of the Closing Date,
upon any proposed issuance by the Company or any of its Subsidiaries of Common Stock, Common Stock Equivalents for cash consideration,
Indebtedness or a combination thereof, other than (i) a rights offering to all holders of Common Stock (which may include extending
such rights offering to holders of Preferred Stock) or (ii) issuance of shares of Common Stock for the purpose of paying bona
fide non-Affiliate vendors of goods and services to the Company at fair market value at the time of issuance (not to exceed
$75,000 per calendar quarter through the earlier of [July 31, 2015] or all of the Preferred Stock has been converted), (a “Subsequent
Financing”), each Purchaser shall have the right to participate in up to an amount of the Subsequent Financing equal
to 100% of the Subsequent Financing (the “Participation Maximum”) on the same terms, conditions and price provided
for in the Subsequent Financing, unless the Subsequent Financing is an underwritten public offering, in which case the Company
shall offer each Purchaser the right to participate in such public offering when it is lawful for the Company to do so, but no
Purchaser shall be entitled to purchase any particular amount of such public offering.

(b)              
At least five (5) Trading Days prior to the closing of the Subsequent Financing, the Company
shall deliver to each Purchaser a written notice of its intention to effect a Subsequent Financing (“Pre-Notice”),
which Pre-Notice shall ask such Purchaser if it wants to review the details of such financing (such additional notice, a “Subsequent
Financing Notice”). Upon the request of a Purchaser, and only upon a request by such Purchaser, for a Subsequent Financing
Notice, the Company shall promptly, but no later than one (1) Trading Day after such request, deliver a Subsequent Financing Notice
to such Purchaser. The requesting Purchaser shall be deemed to have acknowledged that the Subsequent Financing Notice may contain
material non-public information. The Subsequent Financing Notice shall describe in reasonable detail the proposed terms of such
Subsequent Financing, the amount of proceeds intended to be raised thereunder and the Person or Persons through or with whom such
Subsequent Financing is proposed to be effected and shall include a term sheet or similar document relating thereto as an attachment.

(c)               
Any Purchaser desiring to participate in such Subsequent Financing must provide written notice
to the Company by not later than 5:30 p.m. (New York City time) on the fifth (5th) Trading Day after all of the Purchasers
have received the Pre-Notice that the Purchaser is willing to participate in the Subsequent Financing, the amount of such Purchaser’s
participation, and representing and warranting that such Purchaser has such funds ready, willing, and available for investment
on the terms set forth in the Subsequent Financing Notice. If the Company receives no such notice from a Purchaser as of such fifth
(5th) Trading Day, such Purchaser shall be deemed to have notified the Company that it does not elect to participate.

(d)              
If by 5:30 p.m. (New York City time) on the fifth (5th ) Trading Day after all
of the Purchasers have received the Pre-Notice, notifications by the Purchasers of their willingness to participate in the Subsequent
Financing (or to cause their designees to participate) is, in the aggregate, less than the total amount of the Subsequent Financing,
then the Company may effect the remaining portion of such Subsequent Financing on the terms and with the Persons set forth in the
Subsequent Financing Notice. 

(e)   
If by 5:30 p.m. (New York City time) on the fifth (5th) Trading Day after all of
the Purchasers have received the Pre-Notice, the Company receives responses to a Subsequent Financing Notice from Purchasers seeking
to purchase more than the aggregate amount of the Participation Maximum, each such Purchaser shall have the right to purchase its
Pro Rata Portion (as defined below) of the Participation Maximum.  “Pro Rata Portion” means the ratio of
(x) the Subscription Amount of Securities purchased on the Closing Date by a Purchaser participating under this Section 4.12 and
(y) the sum of the aggregate Subscription Amounts of Securities purchased on the Closing Date by all Purchasers participating under
this Section 4.12.

(f)               
The Company must provide the Purchasers with a second Subsequent Financing Notice, and the
Purchasers will again have the right of participation set forth above in this Section 4.12, if the Subsequent Financing subject
to the initial Subsequent Financing Notice is not consummated for any reason on the terms set forth in such Subsequent Financing
Notice within thirty (30) Trading Days after the date of the initial Subsequent Financing Notice.

(g)              
The Company and each Purchaser agree that if any Purchaser elects to
participate in the Subsequent Financing, the transaction documents related to the Subsequent Financing shall not include any term
or provision whereby such Purchaser shall be required to agree to any restrictions on trading as to any of the Securities purchased
hereunder (for avoidance of doubt, the securities purchased in the Subsequent Financing shall not be considered securities purchased
hereunder) or be required to consent to any amendment to or termination of, or grant any waiver, release or the like under or in
connection with, this Agreement, without the prior written consent of such Purchaser.

(h)              
Notwithstanding anything to the contrary in this Section 4.12 and unless
otherwise agreed to by such Purchaser, the Company shall either confirm in writing to such Purchaser that the transaction with
respect to the Subsequent Financing has been abandoned or shall publicly disclose its intention to issue the securities in the
Subsequent Financing, in either case in such a manner such that such Purchaser will not be in possession of any material, non-public
information, by the tenth (10th) Business Day following delivery of the Subsequent Financing Notice. If by such tenth (10th) Business
Day, no public disclosure regarding a transaction with respect to the Subsequent Financing has been made, and no notice regarding
the abandonment of such transaction has been received by such Purchaser, such transaction shall be deemed to have been abandoned
and such Purchaser shall not be deemed to be in possession of any material, non-public information with respect to the Company
or any of its Subsidiaries.

(i)                
Notwithstanding the foregoing, this Section 4.12 shall not apply in respect of (i) an Exempt
Issuance, (ii) an underwritten public offering of Common Stock or (iii) shares of Common Stock issued in settlement of outstanding
severance packages with former officers and directors of the Company.

4.13         
Subsequent Equity Sales. 

(a)               
Except as provided in paragraphs (c) and (d), below, From the date hereof until 60 days after
the date the initial Registration Statement is declared effective by the Commission, neither the Company nor any Subsidiary shall
issue, enter into any agreement to issue or announce the issuance or proposed issuance of any shares of Common Stock or Common
Stock Equivalents.

(b)              
From the date hereof until the later of (i) the date that is the 12 month anniversary of the
Closing Date and (ii) such time as not more than 15% of the originally issued Preferred Stock remains outstanding, the Company
shall be prohibited from effecting or entering into an agreement to effect any issuance by the Company or any of its Subsidiaries
of Common Stock or Common Stock Equivalents for cash consideration (or a combination of units thereof) involving a Variable Rate
Transaction. “Variable Rate Transaction” means a transaction in which the Company (i) issues or sells any debt
or equity securities that are convertible into, exchangeable or exercisable for, or include the right to receive, additional shares
of Common Stock either (A) at a conversion price, exercise price or exchange rate or other price that is based upon, and/or varies
with, the trading prices of or quotations for the shares of Common Stock at any time after the initial issuance of such debt or
equity securities or (B) with a conversion, exercise or exchange price that is subject to being reset at some future date after
the initial issuance of such debt or equity security or upon the occurrence of specified or contingent events directly or indirectly
related to the business of the Company or the market for the Common Stock or (ii) enters into any agreement, including, but not
limited to, an equity line of credit, whereby the Company may sell securities at a future determined price. Any Purchaser shall
be entitled to obtain injunctive relief against the Company to preclude any such issuance, which remedy shall be in addition to
any right to collect damages. 

(c)               
[RESERVED]

(d)              
Notwithstanding the foregoing, this Section 4.13 shall not apply in respect of (i) any rights
offering, (ii) shares of Common Stock for the purpose of paying bona fide non-Affiliate vendors of goods and services to
the Company at fair market value at the time of issuance (not to exceed $75,000 per calendar quarter through the earlier of July
31, 2015 or all of the Preferred Stock has been converted), or (iii) any Exempt Issuance, except that no Variable Rate Transaction,
other than the issuance of Common Stock upon exercise of Warrants outstanding on the date hereof, shall be an Exempt Issuance.

(e)               
Paragraph 4.13(a) shall not apply to the issuance of securities by the Company’s Subsidiary,
Antigen Express, Inc. (“Antigen”), the sale of Antigen securities by the Company or the distribution of Antigen
securities to the Company’s stockholders. 

4.14         
Equal Treatment of Purchasers. No consideration (including any modification of any
Transaction Document) shall be offered or paid to any Person to amend or consent to a waiver or modification of any provision of
any of this Agreement unless the same consideration is also offered to all of the parties to this Agreement. For clarification
purposes, this provision constitutes a separate right granted to each Purchaser by the Company and negotiated separately by each
Purchaser, and is intended for the Company to treat the Purchasers as a class and shall not in any way be construed as the Purchasers
acting in concert or as a group with respect to the purchase, disposition or voting of Securities or otherwise. 

4.15         
Most Favored Nation Provision. From the date hereof until such time as no Purchaser
holds any of the Securities, in the event that the Company issues or sells any Common Stock or Common Stock Equivalents, if a Purchaser
then holding Securities reasonably believes that any of the terms and conditions appurtenant to such issuance or sale are more
favorable to such investors than are the terms and conditions granted to the Purchasers hereunder, upon notice to the Company by
such Purchaser within five Trading Days after disclosure of such issuance or sale, the Company shall amend the terms of this transaction
as to such Purchaser only so as to give such Purchaser the benefit of such more favorable terms or conditions. This Section 4.15
shall not apply with respect to an Exempt Issuance, and shall only apply as to price terms in respect of any rights offering, or
in respect of issuances of Common Stock to vendors as otherwise permitted in Sections 4.12 and 4.13. The Company shall provide
each Purchaser with notice of any such issuance or sale in the manner for disclosure of Subsequent Financings set forth in Section
4.12.

4.16         
Certain Transactions and Confidentiality. Each Purchaser, severally and not jointly
with the other Purchasers, covenants that neither it, nor any Affiliate acting on its behalf or pursuant to any understanding with
it will execute any purchases or sales, including Short Sales, of any of the Company’s securities during the period commencing
with the execution of this Agreement and ending at such time that the transactions contemplated by this Agreement are first publicly
announced pursuant to the initial press release as described in Section 4.6.  Each Purchaser, severally and not jointly with
the other Purchasers, covenants that until such time as the transactions contemplated by this Agreement are publicly disclosed
by the Company pursuant to the initial press release as described in Section 4.6, such Purchaser will maintain the confidentiality
of the existence and terms of this transaction and the information included in the Transaction Documents and the Disclosure Schedules.
Notwithstanding the foregoing, and notwithstanding anything contained in this Agreement to the contrary, the Company expressly
acknowledges and agrees that (i) no Purchaser makes any representation, warranty or covenant hereby that it will not engage in
effecting transactions in any securities of the Company after the time that the transactions contemplated by this Agreement are
first publicly announced pursuant to the initial press release as described in Section 4.6, (ii) no Purchaser shall be restricted
or prohibited from effecting any transactions in any securities of the Company in accordance with applicable securities laws from
and after the time that the transactions contemplated by this Agreement are first publicly announced pursuant to the initial press
release as described in Section 4.6 and (iii) no Purchaser shall have any duty of confidentiality to the Company or its Subsidiaries
after the issuance of the initial press release as described in Section 4.6.  Notwithstanding the foregoing, in the case of
a Purchaser that is a multi-managed investment vehicle whereby separate portfolio managers manage separate portions of such Purchaser’s
assets and the portfolio managers have no direct knowledge of the investment decisions made by the portfolio managers managing
other portions of such Purchaser’s assets, the covenant set forth above shall only apply with respect to the portion of assets
managed by the portfolio manager that made the investment decision to purchase the Securities covered by this Agreement.

4.17         
[RESERVED]

4.18         
Capital Changes. Until the one year anniversary of the Closing Date, the Company shall
not undertake a reverse or forward stock split or reclassification of the Common Stock without the prior written consent of the
Purchasers holding a majority in interest of the shares of Preferred Stock, unless such reverse split is made in conjunction with
the listing of the Common Stock on a national securities exchange.

4.19         
Form D; Blue Sky Filings. The Company agrees to timely file a Form D with respect to
the Securities as required under Regulation D and to provide a copy thereof, promptly upon request of any Purchaser. The Company
shall take such action as the Company shall reasonably determine is necessary in order to obtain an exemption for, or to qualify
the Securities for, sale to the Purchasers at the Closing under applicable securities or “Blue Sky” laws of the states
of the United States, and shall provide evidence of such actions promptly upon request of any Purchaser.

4.20Greenshoe.

(a)From the
date hereof until one year after the Closing Date, each Purchaser may, in its sole determination, elect to purchase, severally
and not jointly with the other Purchasers and, subject to the proviso below, in one or more purchases, in the ratio of such Purchaser’s
original Subscription Amount to the original aggregate Subscription Amount of all Purchasers, additional shares of Preferred Stock
and Warrants with an aggregate subscription amount thereof of up to $2,075,000 (such securities, the “Greenshoe Securities”
and such right to receive the Greenshoe Securities pursuant to this Section 4.20, the “Greenshoe Rights”). The
Greenshoe Securities shall be identical to the Securities, and shall have a conversion price and exercise price, as applicable,
equal to (i) the then-effective conversion price of the Preferred Stock and exercise price of the Warrants, or (ii) if the Preferred
Stock and/or Warrants are no longer outstanding, the most recent conversion price and exercise price of the Preferred Stock and/or
Warrants, as applicable.

(b)Any Greenshoe
Right exercised by a Purchaser shall close within 10 Trading Days of a duly delivered exercise notice by the exercising party.
Any additional investment in the Greenshoe Securities shall be on terms identical to those set forth in the Transaction Documents,
mutatis mutandis. In order to effectuate a purchase and sale of the Greenshoe Securities, the Company and the Purchasers
shall enter into a Securities Purchase Agreement identical to this Agreement, mutatis mutandis and shall include updated disclosure
schedules

ARTICLE V. 

MISCELLANEOUS

5.1             
Termination.  This Agreement may be terminated by any Purchaser, as to such Purchaser’s
obligations hereunder only and without any effect whatsoever on the obligations between the Company and the other Purchasers, by
written notice to the other parties, if the Closing has not been consummated on or before March 28, 2014; provided, however,
that such termination will not affect the right of any party to sue for any breach by any other party (or parties).

5.2             
Fees and Expenses. At the Closing, the Company has agreed to reimburse Alpha Capital
Anstalt the non-accountable sum of $55,000 for its legal fees and due diligence expenses, none of which has been paid prior to
the Closing. Accordingly, in lieu of the foregoing payments, the aggregate amount that Alpha is to pay for the Securities at the
Closing shall be reduced by $55,000 in lieu thereof. Except as expressly set forth in the Transaction Documents to the contrary,
each party shall pay the fees and expenses of its advisers, counsel, accountants and other experts, if any, and all other expenses
incurred by such party incident to the negotiation, preparation, execution, delivery and performance of this Agreement. The Company
shall pay all Transfer Agent fees (including, without limitation, any fees required for same-day processing of any instruction
letter delivered by the Company and any conversion or exercise notice delivered by a Purchaser), stamp taxes and other taxes and
duties levied in connection with the delivery of any Securities to the Purchasers.

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

5.4             
Notices. Any and all notices or other communications or deliveries required or permitted
to be provided hereunder shall be in writing and shall be deemed given and effective on the earliest of: (a) the date of transmission,
if such notice or communication is delivered via facsimile at the facsimile number set forth on the signature pages attached hereto
at or prior to 5:30 p.m. (New York City time) on a Trading Day, (b) the next Trading Day after the date of transmission, if such
notice or communication is delivered via facsimile at the facsimile number set forth on the signature pages attached hereto on
a day that is not a Trading Day or later than 5:30 p.m. (New York City time) on any Trading Day, (c) the second (2nd)
Trading Day following the date of mailing, if sent by U.S. nationally recognized overnight courier service or (d) upon actual receipt
by the party to whom such notice is required to be given. The address for such notices and communications shall be as set forth
on the signature pages attached hereto.

5.5             
Amendments; Waivers. No provision of this Agreement may be waived, modified, supplemented
or amended except in a written instrument signed, in the case of an amendment, by the Company and the Purchasers holding at least
67% in interest of the Securities then outstanding or, in the case of a waiver, by the party against whom enforcement of any such
waived provision is sought. No waiver of any default with respect to any provision, condition or requirement of this Agreement
shall be deemed to be a continuing waiver in the future or a waiver of any subsequent default or a waiver of any other provision,
condition or requirement hereof, nor shall any delay or omission of any party to exercise any right hereunder in any manner impair
the exercise of any such right.

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

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

5.8             
No Third-Party Beneficiaries. This Agreement is intended for the benefit of the parties
hereto and their respective successors and permitted assigns and is not for the benefit of, nor may any provision hereof be enforced
by, any other Person, except as otherwise set forth in Section 4.10.

5.9             
Governing Law. All questions concerning the construction, validity, enforcement and
interpretation of the Transaction Documents shall be governed by and construed and enforced in accordance with the internal laws
of the State of New York, without regard to the principles of conflicts of law thereof. Each party agrees that all legal proceedings
concerning the interpretations, enforcement and defense of the transactions contemplated by this Agreement and any other Transaction
Documents (whether brought against a party hereto or its respective affiliates, directors, officers, shareholders, partners, members,
employees or agents) shall be commenced exclusively in the state and federal courts sitting in the City of New York. Each party
hereby irrevocably submits to the exclusive jurisdiction of the state and federal courts sitting in the City of New York, Borough
of Manhattan for the adjudication of any dispute hereunder or in connection herewith or with any transaction contemplated hereby
or discussed herein (including with respect to the enforcement of any of the Transaction Documents), and hereby irrevocably waives,
and agrees not to assert in any action, suit or proceeding, any claim that it is not personally subject to the jurisdiction of
any such court, that such suit, action or proceeding is improper or is an inconvenient venue for such proceeding. Each party hereby
irrevocably waives personal service of process and consents to process being served in any such suit, action or proceeding by mailing
a copy thereof via registered or certified mail or overnight delivery (with evidence of delivery) to such party at the address
in effect for notices to it under this Agreement and agrees that such service shall constitute good and sufficient service of process
and notice thereof. Nothing contained herein shall be deemed to limit in any way any right to serve process in any other manner
permitted by law. If either party shall commence an action or proceeding to enforce any provisions of the Transaction Documents,
then, in addition to the obligations of the Company under Section 4.10, the prevailing party in such action, suit or proceeding
shall be reimbursed by the other party for its reasonable attorneys’ fees and other costs and expenses incurred with the
investigation, preparation and prosecution of such action or proceeding.

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

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

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

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

5.14         
Replacement of Securities. If any certificate or instrument evidencing any Securities
is mutilated, lost, stolen or destroyed, the Company shall issue or cause to be issued in exchange and substitution for and upon
cancellation thereof (in the case of mutilation), or in lieu of and substitution therefor, a new certificate or instrument, but
only upon receipt of evidence reasonably satisfactory to the Company of such loss, theft or destruction. The applicant for a new
certificate or instrument under such circumstances shall also pay any reasonable third-party costs (including customary indemnity)
associated with the issuance of such replacement Securities.

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

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

5.17         
Usury. To the extent it may lawfully do so, the Company hereby agrees not to insist
upon or plead or in any manner whatsoever claim, and will resist any and all efforts to be compelled to take the benefit or advantage
of, usury laws wherever enacted, now or at any time hereafter in force, in connection with any claim, action or proceeding that
may be brought by any Purchaser in order to enforce any right or remedy under any Transaction Document. Notwithstanding any provision
to the contrary contained in any Transaction Document, it is expressly agreed and provided that the total liability of the Company
under the Transaction Documents for payments in the nature of interest shall not exceed the maximum lawful rate authorized under
applicable law (the “Maximum Rate”), and, without limiting the foregoing, in no event shall any rate of interest
or default interest, or both of them, when aggregated with any other sums in the nature of interest that the Company may be obligated
to pay under the Transaction Documents exceed such Maximum Rate. It is agreed that if the maximum contract rate of interest allowed
by law and applicable to the Transaction Documents is increased or decreased by statute or any official governmental action subsequent
to the date hereof, the new maximum contract rate of interest allowed by law will be the Maximum Rate applicable to the Transaction
Documents from the Closing Date thereof forward, unless such application is precluded by applicable law. If under any circumstances
whatsoever, interest in excess of the Maximum Rate is paid by the Company to any Purchaser with respect to indebtedness evidenced
by the Transaction Documents, such excess shall be applied by such Purchaser to the unpaid principal balance of any such indebtedness
or be refunded to the Company, the manner of handling such excess to be at such Purchaser’s election.

5.18         
Independent Nature of Purchasers’ Obligations and Rights. The obligations of
each Purchaser under any Transaction Document are several and not joint with the obligations of any other Purchaser, and no Purchaser
shall be responsible in any way for the performance or non-performance of the obligations of any other Purchaser under any Transaction
Document. Nothing contained herein or in any other Transaction Document, and no action taken by any Purchaser pursuant hereto or
thereto, shall be deemed to constitute the Purchasers as a partnership, an association, a joint venture or any other kind of entity,
or create a presumption that the Purchasers are in any way acting in concert or as a group with respect to such obligations or
the transactions contemplated by the Transaction Documents. Each Purchaser shall be entitled to independently protect and enforce
its rights, including, without limitation, the rights arising out of this Agreement or out of the other Transaction Documents,
and it shall not be necessary for any other Purchaser to be joined as an additional party in any proceeding for such purpose. Each
Purchaser has been represented by its own separate legal counsel in its review and negotiation of the Transaction Documents. For
reasons of administrative convenience only, each Purchaser and its respective counsel have chosen to communicate with the Company
through EGS. EGS does not represent any of the Purchasers and only represents Alpha. The Company has elected to provide all Purchasers
with the same terms and Transaction Documents for the convenience of the Company and not because it was required or requested to
do so by any of the Purchasers. It is expressly understood and agreed that each provision contained in this Agreement and in each
other Transaction Document is between the Company and a Purchaser, solely, and not between the Company and the Purchasers collectively
and not between and among the Purchasers.

5.19         
Liquidated Damages. The Company’s obligations to pay any partial liquidated damages
or other amounts owing under the Transaction Documents is a continuing obligation of the Company and shall not terminate until
all unpaid partial liquidated damages and other amounts have been paid notwithstanding the fact that the instrument or security
pursuant to which such partial liquidated damages or other amounts are due and payable shall have been canceled.

5.20         
Saturdays, Sundays, Holidays, etc.If the last or appointed day for the taking of
any action or the expiration of any right required or granted herein shall not be a Business Day, then such action may be taken
or such right may be exercised on the next succeeding Business Day.

5.21         
Construction. The parties agree that each of them and/or their respective counsel have
reviewed and had an opportunity to revise the Transaction Documents and, therefore, the normal rule of construction to the effect
that any ambiguities are to be resolved against the drafting party shall not be employed in the interpretation of the Transaction
Documents or any amendments thereto. In addition, each and every reference to share prices and shares of Common Stock in any Transaction
Document shall be subject to adjustment for reverse and forward stock splits, stock dividends, stock combinations and other similar
transactions of the Common Stock that occur after the date of this Agreement.

5.22         
WAIVER OF JURY TRIAL. IN ANY ACTION, SUIT, OR PROCEEDING IN ANY JURISDICTION BROUGHT
BY ANY PARTY AGAINST ANY OTHER PARTY, THE PARTIES EACH KNOWINGLY AND INTENTIONALLY, TO THE GREATEST EXTENT PERMITTED BY APPLICABLE
LAW, HEREBY ABSOLUTELY, UNCONDITIONALLY, IRREVOCABLY AND EXPRESSLY WAIVES FOREVER TRIAL BY JURY. 

 

(Signature Pages
Follow)

    	 

    	 

    

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

	
        generex bioTechnology
        corporation

         

         
	Address for Notice:
	
        By:__________________________________________

        Name:

        Title:

         

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

         

         
	 

 

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK

SIGNATURE PAGE FOR PURCHASER FOLLOWS]

    	 

    	 

    

[PURCHASER
SIGNATURE PAGES TO GNBT SECURITIES PURCHASE AGREEMENT]

 

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

Name of Purchaser: ____________________________________________________________

Signature of Authorized Signatory of
Purchaser: ____________________________________

Name of Authorized Signatory: ____________________________________________________

Title of Authorized Signatory: _____________________________________________________

Email Address of Authorized Signatory:
______________________________________________

Facsimile Number of Authorized Signatory: __________________________________________

Address for Notice to Purchaser:

 

 

 

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

 

 

 

 

Subscription Amount: _____________

 

Shares of Preferred Stock: ____________

 

Warrant Shares: _________________

 

EIN Number: _______________________

 

 

 

[SIGNATURE PAGES CONTINUE]

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