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UNITED STATES
SECURITIES AND EXCHANGE
COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section
13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date
Earliest Event Reported): June 12, 2024
FOXO
TECHNOLOGIES INC.
(Exact name of registrant
as specified in its charter)
Delaware |
|
001-39783 |
|
85-1050265 |
(State or Other Jurisdiction
of Incorporation) |
|
(Commission File Number) |
|
(IRS Employer
Identification No.) |
729
N. Washington Ave., Suite
600 Minneapolis,
MN |
|
55401 |
(Address of Principal Executive Offices) |
|
(Zip Code) |
(612) 562-9447
(Registrant’s
telephone number, including area code)
Check the appropriate
box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following
provisions:
☐ |
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
☐ |
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
☐ |
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
☐ |
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Securities registered pursuant to Section
12(b) of the Act:
Title of each class |
|
Trading Symbol(s) |
|
Name of each exchange on which registered |
Class A Common Stock, par value $0.0001 |
|
FOXO |
|
NYSE American |
Indicate by check mark
whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter)
or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ☒
If an emerging growth
company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or
revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.
Item
1.01 Entry into a Material Definitive Agreement.
On June 12, 2024, FOXO
Technologies Inc., a Delaware corporation (the “Company”), entered into a Securities Purchase Agreement (the “SPA”)
with an institutional investor (the “Purchaser”) pursuant to which the Company agreed to issue to the Purchaser and
subsequent purchasers who will also be parties to the SPA (the Purchaser, together with the purchasers, the “Purchasers”)
Senior Notes in the aggregate principal amount of up to $2,800,000 (each a “Note” or, together, the “Notes”).
The closings of the SPA
(each a “Closing,” or, together, the “Closings”) are as follows:
| ● | On the Initial Closing Date (as defined below),
the Purchaser or Purchasers will purchase up to an aggregate of $840,000 in principal amount of the Notes. The Company will also issue
to the Purchaser or the Purchasers on a pro rata basis an aggregate of 1,108,755 shares of the Company’s Class A Common Stock (the
“Shares”) representing 9.99% of the outstanding shares of Class A Common Stock of the Company on the Initial Closing
Date (as defined below). |
| ● | Upon the Company’s filing of a preliminary
proxy statement or information statement with the Securities and Exchange Commission (the “SEC”) relating to the approval
by the Company’s stockholders of an agreement by the Company to acquire the shares of common stock of Rennova Community Health, Inc.,
a Florida corporation (“RCHI”), from Rennova Health, Inc., a Delaware corporation (“Rennova”), and all
transactions contemplated thereby (the “Acquisition”), the Purchasers will purchase up to an aggregate of $280,000
in principal amount of the Notes. |
| ● | Upon the closing of the Acquisition, the Purchasers
will purchase up to an aggregate of $1,120,000 in principal amount of the Notes. |
| ● | Upon the filing of a registration statement by
the Company with the SEC relating to the resale by the Purchasers (and any affiliates) of all shares of Class A Common Stock of the Company
beneficially owned by each Purchaser (and any affiliate) the Purchasers will purchase up to an aggregate of $560,000 in principal amount
of the Notes. |
Each Closing is subject to additional conditions
as disclosed in the SPA. The disclosure above is not a complete description of the terms of the SPA. A copy of the form of the SPA is
attached hereto as Exhibit 99.1 and is incorporated by reference into Item 1.01 of this Current Report on Form 8-K.
Item
2.03 Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant.
The disclosure contained
in Item 1.01 of this Current Report on Form 8-K is incorporated by reference into Item 2.03 of this Current Report on Form 8-K.
On June 14, 2024 (the
“Initial Closing Date”), pursuant to the SPA, the Company issued a Note in the principal amount of $840,000 to the
Purchaser. The Note matures on June 14, 2025 and the principal amount of the Note is the subscription amount multiplied by 1.12 which
represents 12% original issuance discount. The Note does not accrue any interest exempt for in the event of an Event of Default (as defined
in the Note) upon which it will accrue interest at 18% per annum.
The Note provides the
Purchaser with rights upon a Fundamental Transaction (as defined in the Note) such as assumption rights of the Successor Entity (as defined
in the Note). The Note also provides the Purchaser an exchange right upon the issuance of preferred stock (except in connection with the
Acquisition) and mandatory redemption rights. There is also an optional prepayment of the Note provided to the Company of 100% of the
Note amount. The Note is guaranteed by Rennova.
As of the Initial Closing
Date, the Company has yet to issue the Shares to the Purchaser due to the fact that their issuance is conditioned upon approval from NYSE
American and, although in process, the Company has yet to receive approval.
The disclosure above is not a complete description
of the terms of the Note. A copy of the form of the Note is attached hereto as Exhibit 4.1 and is incorporated by reference into Item
2.03 of this Current Report on Form 8-K.
Item
7.01 Regulation FD Disclosure.
On June 18, 2024, the
Company issued a press release announcing it has entered into the SPA and issued the Note.
A copy of the press release is attached hereto as Exhibit 99.2 and is incorporated herein by reference.
The information under this
Item 7.01, including Exhibit 99.2 hereto, is being furnished herewith and shall not be deemed “filed” for the purposes of
Section 18 of the Exchange Act, or otherwise subject to the liabilities of that section, nor shall such information be deemed incorporated
by reference into any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as expressly set forth by specific
reference in such filing. Furthermore, the furnishing of information under Item 7.01 of this Current Report on Form 8-K is not intended
to constitute a determination by the Company that the information contained herein, including the exhibit hereto, is material or that
the dissemination of such information is required by Regulation FD.
Cautionary Statement
Regarding Forward-Looking Statements
This Current Report on
Form 8-K contains “forward-looking statements.” Any statements contained in this Current Report on Form 8-K that do not describe
historical facts may constitute forward-looking statements. In some cases, you can identify forward-looking statements by terminology
such as “if,” “may,” “should,” “expects,” “plans,” “anticipates,”
“believes,” “estimates,” “predicts,” “potential” or “continue” or the negative
of these terms or other comparable terminology and include statements regarding the NYSE American Notice and whether the Company will
regain compliance with the NYSE American’s continued listing standards. These forward-looking statements are based on information
currently available to the Company’s management as well as estimates and assumptions made by its management and are subject to risks
and uncertainties that may cause actual results, performance or developments to differ materially from those contained in the statements.
These statements are only predictions and involve known and unknown risks, uncertainties and other factors, which may cause the Company’s
or its industry’s actual results, levels of activity or performance to be materially different from any future results, levels of
activity or performance expressed or implied by these forward-looking statements. These forward-looking statements are made as of the
date of this Current Report on Form 8-K, and the Company does not undertake an obligation to update these forward-looking statements after
such date.
Item 9.01.
Financial Statements and Exhibits.
(d) Exhibits
SIGNATURES
Pursuant to the requirements
of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto
duly authorized.
|
FOXO Technologies Inc. |
|
|
|
Date: June 18, 2024 |
By: |
/s/ Mark White |
|
|
Name: |
Mark White |
|
|
Title: |
Interim Chief Executive Officer |
3
Exhibit 4.1
FORM OF
SENIOR NOTE
THIS SECURITY HAS NOT BEEN REGISTERED
WITH THE SECURITIES AND EXCHANGE COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE IN RELIANCE UPON AN EXEMPTION FROM REGISTRATION
UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT
TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT
TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS. 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. ANY
TRANSFEREE OF THIS NOTE SHOULD CAREFULLY REVIEW THE TERMS OF THIS NOTE, INCLUDING SECTIONS 3(c)(iii) AND 18(a) HEREOF. THE PRINCIPAL AMOUNT
REPRESENTED BY THIS NOTE MAY BE LESS THAN THE AMOUNT SET FORTH ON THE FACE HEREOF PURSUANT TO SECTION 3(c)(iii) OF THIS NOTE.
THIS NOTE HAS BEEN ISSUED WITH
ORIGINAL ISSUE DISCOUNT (“OID”). PURSUANT TO TREASURY REGULATION §1.1275-3(b)(1), MARK WHITE, A REPRESENTATIVE OF THE
COMPANY HEREOF WILL, BEGINNING TEN DAYS AFTER THE ISSUANCE DATE OF THIS NOTE, PROMPTLY MAKE AVAILABLE TO THE HOLDER UPON REQUEST THE INFORMATION
DESCRIBED IN TREASURY REGULATION §1.1275-3(b)(1)(i). MARK WHITE MAY BE REACHED AT TELEPHONE NUMBER +44 7973 802 488.
FOXO TECHNOLOGIES INC.
SENIOR NOTE
Issuance Date: |
Original Principal Amount: U.S. |
FOR VALUE
RECEIVED, FOXO Technologies Inc., a Delaware corporation (the “Company”) and Rennova Health, Inc., a Delaware
corporation (“Guarantor”), hereby promises to pay _____________________________________to or registered assigns
(the “Holder”) in cash the amount set forth above as the Original Principal Amount (as reduced pursuant to
the terms hereof pursuant to redemption or otherwise, the “Principal”) when due, whether upon the Maturity Date
(as defined below), acceleration, redemption or otherwise (in each case in accordance with the terms hereof) and to pay interest
(“Interest”), if applicable, on any outstanding Principal at the applicable Default Rate at any time during the
occurrence and continuance of an Event of Default occurring from the date set out above as the Issuance Date (the “Issuance
Date”) until the same becomes due and payable, whether upon the Maturity Date, acceleration, redemption or otherwise (in
each case in accordance with the terms hereof). This Senior Note (including all Senior Notes issued in exchange, transfer or
replacement hereof, this “Note”) is one of an issue of Senior Notes issued pursuant to the Securities Purchase
Agreement on the Closing Dates (collectively, the “Notes” and such other Senior Notes, the “Other
Notes”). Certain capitalized terms used herein are defined in Section 31.
(1) ORIGINAL
ISSUE DISCOUNT; PAYMENTS OF PRINCIPAL; PREPAYMENT. The Company acknowledges and agrees that this Note was issued at an original issue
discount. On the Maturity Date, if any portion of this Note remains outstanding, the Company shall pay to the Holder an amount in cash
representing all outstanding Principal, any accrued and unpaid Interest. The “Maturity Date” shall be June __, 2025 as
may be extended at the option of the Holder (x) in the event that, and for so long as, an Event of Default (as defined in Section 4(a))
shall have occurred and be continuing on the Maturity Date (as may be extended pursuant to this Section 1) or any event shall have occurred
and be continuing on the Maturity Date (as may be extended pursuant to this Section 1) that with the passage of time and the failure to
cure would result in an Event of Default and/or (y) through the date that is ten (10) Business Days after the consummation of a Change
of Control in the event that a Change of Control is publicly announced or a Change of Control Notice (as defined in Section 5(b)) is delivered
prior to the Maturity Date. Other than as specifically permitted by this Note, the Company may not prepay any portion of the outstanding
Principal or accrued and unpaid Interest, if any.
(2) INTEREST.
No Interest shall accrue hereunder unless and until an Event of Default has occurred. From and after the occurrence and during the continuance
of any Event of Default, Interest shall accrue hereunder at eighteen percent (18.0%) per annum (the “Default Rate”)
and shall be computed on the basis of a 360-day year and twelve 30-day months and shall be payable, if applicable, on the Maturity Date
to the record holder of this Note in cash by wire transfer of immediately available funds pursuant to wire instructions provided by the
Holder in writing to the Company. Accrued and unpaid Interest, if any, may also be payable, at the election of the Holder, by way of inclusion
of the Interest in the Note Amount (as defined below) upon any redemption hereunder occurring prior to the Maturity Date, including, without
limitation, upon a Bankruptcy Event of Default redemption. In the event that an Event of Default is subsequently cured (and no other Event
of Default then exists (including, without limitation, for the Company’s failure to pay such Interest at the Default Rate on the Maturity
Date)), Interest shall cease to accrue hereunder as of the calendar day immediately following the date of such cure; provided that
the Interest as calculated and unpaid during the continuance of such Event of Default shall continue to apply to the extent relating to
the days after the occurrence of such Event of Default through and including the date of such cure of such Event of Default; provided,
further, that for the purpose of this Section 2, such Event of Default shall not be deemed cured unless and until any accrued and
unpaid Interest shall be paid to the Holder. As used herein, “Note Amount” means the sum of (x) the portion of the
Principal to be redeemed or otherwise with respect to which this determination is being made, and (y) accrued and unpaid Interest, if
any, with respect to such Principal.
(3) Note
Registration; Book Entry. The Company shall maintain a register (the “Register”) for the recordation of the
names and addresses of the holders of each Note and the Principal amount of the Notes (and stated interest thereon) held by such
holders (the “Registered Notes”). The entries in the Register shall be conclusive and binding for all purposes
absent manifest error. The Company and the holders of the Notes shall treat each Person whose name is recorded in the Register as
the owner of a Note for all purposes, including, without limitation, the right to receive payments of Principal and Interest, if
any, hereunder, notwithstanding notice to the contrary. A Registered Note may be assigned or sold in whole or in part only by
registration of such assignment or sale on the Register. Upon its receipt of a request to assign or sell all or part of any
Registered Note by the Holder, the Company shall record the information contained therein in the Register and issue one or more new
Registered Notes in the same aggregate Principal amount as the Principal amount of the surrendered Registered Note to the designated
assignee or transferee pursuant to Section 18. Notwithstanding anything to the contrary in this Section 3(c)(iii), the Holder may
assign any Note or any portion thereof to an Affiliate of the Holder or a Related Fund of the Holder without delivering a request to
assign or sell the Note to the Company and the recordation of such assignment or sale in the Register (a “Related Party
Assignment”); provided, that (x) the Company may continue to deal solely with such assigning or selling Holder unless and
until the Holder has delivered a request to assign or sell the Note or portion thereof to the Company for recordation in the
Register; (y) the failure of such assigning or selling Holder to deliver a request to assign or sell the Note or portion thereof to
the Company shall not affect the legality, validity, or binding effect of such assignment or sale and (z) such assigning or selling
Holder shall, acting solely for this purpose as a non-fiduciary agent of the Company, maintain a register (the “Related
Party Register”) comparable to the Register on behalf of the Company, and any such assignment or sale shall be effective
upon recordation of such assignment or sale in the Related Party Register.
| (4) | RIGHTS UPON EVENT OF DEFAULT. |
(a) Event
of Default. Each of the following events or failure to comply therewith shall constitute an “Event of Default”
and each of the events described in clauses (iii) and (iv) shall also constitute a “Bankruptcy Event of Default”:
(i) the
Company’s failure to pay to the Holder any amount of Principal, Interest, Redemption Price or other amounts when and as due under this
Note or any other Transaction Document, except, in the case of a failure to pay Interest when and as due, in which case only if such failure
continues for a period of at least an aggregate of two (2) Business Days;
(ii) any
default under, redemption of or acceleration prior to maturity of any Indebtedness of the Company or any of its Subsidiaries other than
with respect to this Note or any Other Notes;
(iii) the Company
or any of its Subsidiaries, pursuant to or within the meaning of Title 11, U.S. Code, or any similar federal, foreign or state law for
the relief of debtors (collectively, “Bankruptcy Law”), (A) commences a bankruptcy voluntary case, (B) consents to
the entry of an order for relief against it in an involuntary bankruptcy case, (C) consents to the appointment of a receiver, trustee,
assignee, liquidator or similar official (a “Custodian”), (D) makes a general assignment for the benefit of its creditors
or (E) admits in writing that it is generally unable to pay its debts as they become due;
(iv) a
court of competent jurisdiction enters an order or decree under any Bankruptcy Law that (A) is for relief against the Company or any of
its Subsidiaries in an involuntary case, (B) appoints a Custodian of the Company or any of its Subsidiaries or (C) orders the liquidation
of the Company or any of its Subsidiaries;
(v) a
final judgment or judgments for the payment of money aggregating in excess of $250,000 are rendered against the Company or any of its
Subsidiaries and which judgments are not, within sixty (60) days after the entry thereof, bonded, discharged or stayed pending appeal,
or are not discharged within sixty (60) days after the expiration of such stay; provided, however, that any judgment which
is covered by insurance or an indemnity from a credit worthy party shall not be included in calculating the $250,000 amount set forth
above so long as the Company provides the Holder a written statement from such insurer or indemnity provider (which written statement
shall be reasonably satisfactory to the Holder) to the effect that such judgment is covered by insurance or an indemnity and the Company
or such Subsidiary (as the case may be) will receive the proceeds of such insurance or indemnity within thirty (30) days of the issuance
of such judgment;
(vi) other
than as specifically set forth in another clause of this Section 4(a), the Company or any of its Subsidiaries breaches any representation,
warranty, covenant or other term or condition of any Transaction Document, except, in the case of a breach of a covenant or other term
or condition of any Transaction Document which is curable, only if such breach continues for a period of at least an aggregate of five
(5) Business Days;
(vii) any
breach or failure in any respect to comply with either Sections 14 or 15 of this Note;
(viii) any
material damage to, or loss, theft or destruction of a material amount of property of the Company, whether or not insured, or any strike,
lockout, labor dispute, embargo, condemnation, act of God or public enemy, or other casualty which causes, for more than fifteen (15)
consecutive days, the cessation or substantial curtailment of revenue producing activities at any facility of the Company or any Subsidiary,
if any such event or circumstance would reasonably be expected to have a Material Adverse Effect;
(ix)
any Material Adverse Effect occurs;
(x) any
Event of Default (as defined in the Other Notes) occurs with respect to any Other Notes.
(b) Redemption
Right. At any time after the earlier of the Holder’s receipt of an Event of Default Notice (as defined in Section 15(f)) and the
Holder becoming aware of an Event of Default, the Holder may require the Company to redeem (an “Event of Default
Redemption”) all or any portion of this Note by delivering written notice thereof (the “Event of Default
Redemption Notice”) to the Company, which Event of Default Redemption Notice shall indicate the portion of this Note the
Holder is electing to require the Company to redeem. Each portion of this Note subject to redemption by the Company pursuant to this
Section 4(b) shall be redeemed by the Company in cash by wire transfer of immediately available funds at a price equal to the
product of (A) the Redemption Premium and (B) the Note Amount being redeemed (the “Event of Default Redemption
Price”). Redemptions required by this Section 4(b) shall be made in accordance with the provisions of Section 11. To the
extent redemptions required by this Section 4(b) are deemed or determined by a court of competent jurisdiction to be prepayments of
the Note by the Company, such redemptions shall be deemed to be voluntary prepayments. The parties hereto agree that in the event of
the Company’s redemption of any portion of the Note under this Section 4(b), the Holder’s damages would be uncertain and difficult
to estimate because of the parties’ inability to predict future interest rates and the uncertainty of the availability of a suitable
substitute investment opportunity for the Holder. Accordingly, any Redemption Premium with respect to an Event of Default due under
this Section 4(b) is intended by the parties to be, and shall be deemed, a reasonable estimate of the Holder’s actual loss of its
investment opportunity and not as a penalty.
(c) Redemption
upon Bankruptcy Event of Default. Notwithstanding anything to the contrary herein upon any Bankruptcy Event of Default, whether occurring
prior to or following the Maturity Date, the Company shall immediately pay to the Holder an amount in cash representing 100% of all outstanding
Principal, accrued and unpaid Interest, if any, in addition to any and all other amounts due hereunder (the “Bankruptcy Event
of Default Redemption Price”), without the requirement for any notice or demand or other action by the Holder or any other Person;
provided that the Holder may, in its sole discretion, waive such right to receive payment upon a Bankruptcy Event of Default, in whole
or in part, and any such waiver shall not affect any other rights of the Holder hereunder, including any other rights in respect of such
Bankruptcy Event of Default, and any right to payment of the Event of Default Redemption Price or any other Redemption Price, as applicable.
Redemptions required by this Section 3(c) shall be made in accordance with the provisions of Section 11.
(5)
RIGHTS UPON FUNDAMENTAL TRANSACTION AND CHANGE OF CONTROL.
(a) Assumption.
The Company shall cause any successor entity in a Fundamental Transaction in which the Company is not the survivor (the
“Successor Entity”) to assume in writing all of the obligations of the Company under this Note and the other
Transaction Documents in accordance with the provisions of this Section 5(a) pursuant to written agreements in form and substance
reasonably satisfactory to the Holder and approved by the Holder (without unreasonable delay) prior to such Fundamental Transaction
and shall, at the option of the Holder, deliver to the Holder in exchange for this Note a security of the Successor Entity evidenced
by a written instrument substantially similar in form and substance to this Note. Upon the occurrence of any such Fundamental
Transaction, the Successor Entity shall be added to the term “Company” under this Note (so that from and after the
occurrence or consummation of such Fundamental Transaction, each and every provision of this Note and the other Transaction
Documents referring to the “Company” shall refer instead to each of the Company and the Successor Entity or Successor
Entities, jointly and severally), and the Successor Entity or Successor Entities, jointly and severally with the Company, may
exercise every right and power of the Company prior thereto and the Successor Entity or Successor Entities shall assume all of the
obligations of the Company prior thereto under this Note and the other Transaction Documents with the same effect as if the Company
and such Successor Entity or Successor Entities, jointly and severally, had been named as the Company in this Note.
(b) Redemption
Right. No later than ten (10) days prior to the consummation of a Change of Control, the Company shall deliver written notice thereof
via electronic mail and overnight courier to the Holder (a “Change of Control Notice”) setting forth a description
of such transaction in reasonable detail and the anticipated Change of Control Redemption Date (as defined in Section 11(a)) if then known.
At any time during the period beginning on the earlier to occur of (x) any oral or written agreement by the Company or any of its Subsidiaries,
upon consummation of which the transaction contemplated thereby would reasonably be expected to result in a Change of Control, (y) the
Holder becoming aware of a Change of Control and (z) the Holder’s receipt of a Change of Control Notice and ending twenty-five (25) days
after the date of the consummation of such Change of Control, the Holder may require the Company to redeem (a “Change of Control
Redemption”) all or any portion of this Note by delivering written notice thereof (“Change of Control Redemption Notice”)
to the Company, which Change of Control Redemption Notice shall indicate the Note Amount the Holder is electing to require the Company
to redeem; provided however, that in the event of the Proposed Rennova Issuance (defined in Section 6 below) the Holder shall not be entitled
to a Change of Control Redemption and will instead be entitled to the involuntary exchange described in Section 6 below. The portion of
this Note subject to redemption pursuant to this Section 5(b) shall be redeemed by the Company in cash by wire transfer of immediately
available funds at a price equal to the Note Amount being redeemed (the “Change of Control Redemption Price”). Redemptions
required by this Section 5 shall be made in accordance with the provisions of Section 11 and shall have priority to payments to stockholders
in connection with a Change of Control. To the extent redemptions required by this Section 5(b) are deemed or determined by a court of
competent jurisdiction to be prepayments of the Note by the Company, such redemptions shall be deemed to be voluntary prepayments. The
parties hereto agree that in the event of the Company’s redemption of any portion of the Note under this Section 5(b), the Holder’s damages
would be uncertain and difficult to estimate because of the parties’ inability to predict future interest rates and the uncertainty of
the availability of a suitable substitute investment opportunity for the Holder.
(6) EXCHANGE
RIGHT. From the date hereof until the date when this Note is no longer outstanding, in the event the Company authorizes or
issues, or enters into any agreement to authorize or issue, any shares of preferred stock, the Holder may elect (except in the event
of the issuance of shares of preferred stock of the Company (the “Proposed Rennova Issuance”) to Rennova Health,
Inc., a Delaware corporation (“Rennova”), for the acquisition of shares of common stock of Rennova Community Health,
Inc., a Florida corporation (“RCHI”) in which instance, on the further condition that the conversion shares underlying
such preferred stock are registered for resale under an effective registration statement filed with the SEC under the Securities
Act, the exchange will be involuntary and automatic), in its sole discretion, to exchange all or some of this Note then held by the
Holder for such shares of preferred stock. With respect to any such exchange Holder will receive the equivalent of $1.00 of
preferred stock (or new subscription amount equivalent) for each $0.90 of Principal, Interest and/or liquidated damages (or any
other amounts owing on this Note). By way of example, if the Principal being exchanged is $750,000, then the Holder shall have the
right to surrender $750,000 of Principal in lieu of cash consideration in exchange for issuance of preferred stock in the amount of
$825,000 (and any Interest, liquidated damages or any other amounts due to Holder with respect to such Principal shall remain
outstanding and owed to Holder).
(a) Occurrence
of Mandatory Redemption. While this Note is outstanding, the Company shall use at least 100% of the net proceeds of any offering of
its securities, including any underwritten or other public offering of securities (any such offering, a “Subsequent Offering”)
to first redeem this Note in full, including the Note Amount and all other amounts due and payable pursuant to this Note, and all other
then outstanding Notes (a “Mandatory Redemption”); provided, however, that if 100% of the net proceeds
of the Subsequent Offering are less than the amount required to repay all of the Notes in full, (i) the Company’s repayment obligation
under this Section 6(a) shall be limited to the amount of such net proceeds, (ii) the net proceeds shall be applied to all of the Notes
then outstanding pro rata based on the principal amount of such Notes then outstanding and (iii) the Company shall effect successive Mandatory
Redemptions upon each Subsequent Offering until the Notes are repaid in full or otherwise no longer outstanding.
(b) Mandatory
Notices. With respect to each Mandatory Redemption, the Company shall deliver a written notice to all, but not less than all, of the
holders of Notes (the “Mandatory Redemption Notice” and the date such notice is delivered to all such holders is referred
to as a “Mandatory Redemption Notice Date”) (a) stating the date on which the Mandatory Redemption shall occur (a “Mandatory
Redemption Date”), which date shall be the date of the consummation of the applicable Subsequent Offering, (b) stating the expected
amount of Net Proceeds with respect to the applicable Subsequent Offering and (c) contain a certification from the Chief Executive Officer
or Chief Financial Officer of the Company that the Company has simultaneously taken the same action with respect to all of the Notes.
Each Mandatory Redemption Notice shall be delivered no later than the first (1st) Business Day following the announcement of the pricing
of the applicable Subsequent Offering, and the Company shall make a public announcement containing the information set forth in the applicable
Mandatory Redemption Notice on or before the related Mandatory Redemption Notice Date to the extent that the notice contains any, or constitutes,
material, non-public information.
(c) Mandatory
Redemption Procedure. The payment of cash pursuant to the Mandatory Redemption shall be payable in full on the Business Day immediately
following the Mandatory Redemption Date by wire transfer of immediately available funds in accordance with the Holder’s wire instructions.
If any portion of the payment pursuant to a Mandatory Redemption shall not be paid by the Company by the applicable due date, interest
shall accrue thereon at an interest rate equal to the lesser of eighteen percent (18%) per annum or the maximum rate permitted by applicable
law until such amount is paid in full. Notwithstanding anything to the contrary in this Section 6(c), the Net Proceeds shall be applied
ratably among the Holders of the Notes.
(8) OPTIONAL
PREPAYMENT. The Company may prepay (each, an “Optional Prepayment”) the Note in whole or in part at any
time or from time to time by paying the Holder in cash by wire transaction of immediately available funds 100% of the Note Amount
being prepaid. The Company may exercise its right to require prepayment under this Section 8 by delivering a written notice thereof
by electronic mail and overnight courier to the Holder and all, but not less than all, of the holders of the Other Notes (an
“Optional Prepayment Notice” and the date all of the holders of the Notes received such notice is referred to as
the “Optional Prepayment Notice Date”). Each Optional Prepayment Notice shall be irrevocable. Each Optional
Prepayment Notice shall (i) state the date on which the Optional Prepayment shall occur (the “Optional Prepayment
Date”), which date shall not be less than two (2) Business Days following the applicable Optional Prepayment Notice Date,
and (ii) state the aggregate Note Amount of the Notes which the Company has elected to be subject to Optional Prepayment from the
Holder and all of the other holders of the Other Notes pursuant to this Section 8 (and analogous provisions under the Other Notes)
on the related Optional Prepayment Date. If the Company elects to cause an Optional Prepayment pursuant to this Section 8, then it
must simultaneously take the same action in the same proportion with respect to the Other Notes.
(9) NONCIRCUMVENTION.
The Company hereby covenants and agrees that the Company will not, by amendment of its Certificate of Incorporation or Bylaws or through
any reorganization, transfer of assets, consolidation, merger, scheme of arrangement, dissolution, issue or sale of securities, or any
other voluntary action, avoid or seek to avoid the observance or performance of any of the terms of this Note, and will at all times in
good faith carry out all of the provisions of this Note and take all action as may be required to protect the rights of the Holder of
this Note.
| (10) | [Intentionally Omitted] |
(a) Mechanics. The
Company shall deliver the applicable Event of Default Redemption Price to the Holder within three (3) Business Days after the
Company’s receipt of the Holder’s Event of Default Redemption Notice; provided that upon a Bankruptcy Event of Default, the Company
shall deliver the applicable Bankruptcy Event of Default Redemption Price in accordance with Section 4(c) (as applicable, the
“Event of Default Redemption Date”). If the Holder has submitted a Change of Control Redemption Notice in
accordance with Section 5(b), the Company shall deliver the applicable Change of Control Redemption Price to the Holder (i)
concurrently with the consummation of such Change of Control if such notice is received prior to the consummation of such Change of
Control and (ii) within three (3) Business Days after the Company’s receipt of such notice otherwise (such date, the
“Change of Control Redemption Date”). The Company shall deliver the applicable Note Amount being prepaid to the
Holder on the applicable Optional Prepayment Date. The Company shall pay the applicable Redemption Price to the Holder in cash by
wire transfer of immediately available funds pursuant to wire instructions provided by the Holder in writing to the Company on the
applicable due date. In the event of a redemption of less than all of the Note Amount of this Note, the Company shall promptly cause
to be issued and delivered to the Holder a new Note (in accordance with Section 18(d)) representing the outstanding Principal which
has not been redeemed and any accrued Interest on such Principal which shall be calculated as if no Redemption Notice has been
delivered. In the event that the Company does not pay a Redemption Price to the Holder within the time period required, at any time
thereafter and until the Company pays such unpaid Redemption Price in full, the Holder shall have the option, in lieu of redemption,
to require the Company to promptly return to the Holder all or any portion of this Note representing the Note Amount that was
submitted for redemption and for which the applicable Redemption Price has not been paid. Upon the Company’s receipt of such notice,
(x) the applicable Redemption Notice shall be null and void with respect to such Note Amount, and (y) the Company shall immediately
return this Note, or issue a new Note (in accordance with Section 18(d)) to the Holder representing such Note Amount to be
redeemed.
(b) Redemption
by Other Holders. Upon the Company’s receipt of notice from any of the holders of the Other Notes for redemption or repayment as a
result of an event or occurrence substantially similar to the events or occurrences described in Section 4(b), Section 5(b) or Section
8 or pursuant to corresponding provisions set forth in the Other Notes (each, an “Other Redemption Notice”), the Company
shall immediately, but no later than one (1) Business Day of its receipt thereof, forward to the Holder by electronic mail a copy of such
notice. If the Company receives a Redemption Notice and one or more Other Redemption Notices, during the seven (7) Business Day period
beginning on and including the date which is three (3) Business Days prior to the Company’s receipt of the Holder’s Redemption Notice
and ending on and including the date which is three (3) Business Days after the Company’s receipt of the Holder’s Redemption Notice and
the Company is unable to redeem all principal, interest and other amounts designated in such Redemption Notice and such Other Redemption
Notices received during such seven (7) Business Day period, then the Company shall redeem, a pro rata amount from the Holder and each
holder of the Other Notes based on the Principal amount of this Note and the Other Notes submitted for redemption pursuant to such Redemption
Notice and such Other Redemption Notices received by the Company during such seven (7) Business Day period.
(c) Insufficient
Assets. If upon a Redemption Date, the assets of the Company are insufficient to pay the applicable Redemption Price, the Company
shall (i) take all appropriate action reasonably within its means to maximize the assets available for paying the applicable Redemption
Price, (ii) redeem out of all such assets available therefor on the applicable Redemption Date the maximum possible portion of the applicable
Redemption Price that it can redeem on such date, pro rata among the Holder and the holders of the Other Notes to be redeemed in proportion
to the aggregate Principal amount of this Note and the Other Notes outstanding on the applicable Redemption Date and (iii) following the
applicable Redemption Date, at any time and from time to time when additional assets of the Company become available to pay the balance
of the applicable Redemption Price of this Note and the Other Notes, the Company shall use such assets, at the end of the then current
fiscal quarter, to pay the balance of such Redemption Price of this Note and the Other Notes, or such portion thereof for which assets
are then available, on the basis set forth above at the applicable Redemption Price, and such assets will not be used prior to the end
of such fiscal quarter for any other purpose. Interest on the Principal amount of this Note and the Other Notes that have not been redeemed
shall continue to accrue until such time as the Company redeems this Note and the Other Notes. The Company shall pay to the Holder the
applicable Redemption Price without regard to the legal availability of funds unless expressly prohibited by applicable law or unless
the payment of the applicable Redemption Price could reasonably be expected to result in personal liability to the directors of the Company.
(12) VOTING
RIGHTS. The Holder shall have no voting rights as the holder of this Note, except as required by law and as expressly provided in
this Note.
(13) RANK.
All payments due under this Note (a) shall rank pari passu with all Other Notes and (b) shall be senior to all other Indebtedness
of the Company and its Subsidiaries.
(14) NEGATIVE
COVENANTS. Except as noted below, until all of the Notes have been redeemed or otherwise satisfied in full in accordance with their
terms, the Company shall not, and the Company shall not permit any of its Subsidiaries without the prior written consent of the Required
Holders to, directly or indirectly by merger or otherwise:
(a) while
any Notes remain outstanding, incur or guarantee, assume or suffer to exist any Indebtedness, other than Permitted Indebtedness;
(b) allow
or suffer to exist any mortgage, lien, pledge, charge, security interest or other encumbrance upon or in any property or assets (including
accounts and contract rights) owned by the Company or any of its Subsidiaries (collectively, “Liens”) other than Permitted
Liens;
(c) redeem,
defease, repurchase, repay or make any payments in respect of, by the payment of cash or cash equivalents (in whole or in part, whether
by way of open market purchases, tender offers, private transactions or otherwise), all or any portion of any Indebtedness (other than
this Note and the Other Notes), whether by way of payment in respect of principal of (or premium, if any) or interest on, such Indebtedness
if at the time such payment is due or is otherwise made or, after giving effect to such payment, an event constituting, or that with the
passage of time and without being cured would constitute, an Event of Default has occurred and is continuing;
(d) redeem,
defease, repurchase, repay or make any payments in respect of, by the payment of cash or cash equivalents (in whole or in part, whether
by way of open market purchases, tender offers, private transactions or otherwise), all or any portion of any Indebtedness (including,
without limitation Permitted Indebtedness other than this Note and the Other Notes), by way of payment in respect of principal of (or
premium, if any) such Indebtedness. For clarity, such restriction shall not preclude the payment of regularly scheduled interest payments
which may accrue under such Permitted Indebtedness;
(e)
redeem or repurchase any Equity Interest of the Company;
(f) declare
or pay any cash dividend or distribution on any Equity Interest of the Company or of its Subsidiaries other than wholly-owned Subsidiaries;
(g) make,
any change in the nature of its business as described in the Company’s most recent Annual Report filed on Form 10-K with the SEC or modify
its corporate structure or purpose; or
(h) encumber,
license or otherwise allow any Liens on any Intellectual Property Rights, including, without limitation, any claims for damage by way
of any past, present, or future infringement of any of the foregoing, in each case, other than Permitted Liens;
(i) enter
into, renew, extend or be a party to, any transaction or series of related transactions (including, without limitation, the purchase,
sale, lease, license, transfer or exchange of property or assets of any kind or the rendering of services of any kind) with any Affiliate,
except in the ordinary course of business in a manner and to an extent consistent with past practice and necessary or desirable for the
prudent operation of its business, for fair consideration and on terms no less favorable to it or its Subsidiaries than would be obtainable
in a comparable arm’s length transaction with a Person that is not an Affiliate thereof; or
(j) issue
any Notes or issue any other securities that would cause a breach or default under the Notes.
(15) AFFIRMATIVE
COVENANTS. Until all of the Notes have been redeemed or otherwise satisfied in full in accordance with their terms, the Company shall,
and the Company shall cause each Subsidiary to, unless otherwise agreed to by the Required Holders, directly and indirectly:
(a) maintain
and preserve its existence, rights and privileges, and become or remain duly qualified and in good standing in each jurisdiction in which
the character of the properties owned or leased by it or in which the transaction of its business makes such qualification necessary;
(b) maintain
and preserve all of its properties which are necessary or useful in the proper conduct of its business in good working order and condition,
ordinary wear and tear excepted, and comply at all times with the provisions of all leases to which it is a party as lessee or under which
it occupies property, so as to prevent any loss or forfeiture thereof or thereunder;
(c) take
all action necessary or advisable to maintain all of the Intellectual Property Rights that is necessary or material to the conduct of
its business in full force and effect;
(d) maintain
insurance with responsible and reputable insurance companies or associations (including, without limitation, comprehensive general liability,
hazard, rent and business interruption insurance) with respect to its properties (including all real properties leased or owned by it)
and business, in such amounts and covering such risks as is required by any governmental authority having jurisdiction with respect thereto
or as is carried generally in accordance with sound business practice by companies in similar businesses similarly situated; and
(e) promptly,
but in any event within one (1) Business Day, notify the Holder and the holders of the Other Notes in writing whenever an Event of Default
(an “Event of Default Notice”) occurs, and simultaneously with the delivery of such notice to the Holder and the holders
of the Other Notes, file a Current Report on Form 8-K with the SEC to state such fact.
(16) VOTE TO ISSUE,
OR CHANGE THE TERMS OF, NOTES. The affirmative vote at a meeting duly called for such purpose or the written consent without a
meeting of the Required Holders shall be required for any exchange, change or amendment or waiver of any provision to this Note or
any of the Other Notes. Any exchange, change, amendment or waiver by the Company and the Required Holders shall be binding on the
Holder of this Note and all holders of the Other Notes. The Holder hereby acknowledges and agrees that any action taken pursuant to
this Section may result in, or be perceived to result in, a disproportionate impact on the Holder compared to the impact of such
action on one or more holder(s) of Other Notes. This provision constitutes a separate right granted to each of the holders of Notes
by the Company and shall not in any way be construed as such holders acting in concert or as a group with respect to the purchase,
disposition or voting of securities or otherwise.
(17) TRANSFER.
This Note may be offered, sold, assigned or transferred by the Holder without the consent of the Company, subject only to the provisions
of Section 4.1 of the Securities Purchase Agreement.
| (18) | REISSUANCE OF THIS NOTE. |
(a) Transfer.
If this Note is to be transferred, the Holder shall surrender this Note to the Company, whereupon the Company will forthwith issue and
deliver upon the order of the Holder a new Note (in accordance with Section 18(d) and subject to Section 3(c)(iii)), registered as the
Holder may request, representing the outstanding Principal being transferred by the Holder and, if less than the entire outstanding Principal
is being transferred, a new Note (in accordance with Section 18(d)) to the Holder representing the outstanding Principal not being transferred.
The Holder and any assignee, by acceptance of this Note, acknowledge and agree that, by reason of the provisions of Section 3(c)(iii)
following redemption of any portion of this Note, the outstanding Principal represented by this Note may be less than the Principal stated
on the face of this Note.
(b) Lost,
Stolen or Mutilated Note. Upon receipt by the Company of evidence reasonably satisfactory to the Company of the loss, theft, destruction
or mutilation of this Note, and, in the case of loss, theft or destruction, of any indemnification undertaking by the Holder to the Company
in customary form (but without any obligation to post a surety or other bond) and, in the case of mutilation, upon surrender and cancellation
of this Note, the Company shall execute and deliver to the Holder a new Note (in accordance with Section 18(d)) representing the outstanding
Principal.
(c) Note
Exchangeable for Different Denominations. This Note is exchangeable, upon the surrender hereof by the Holder at the principal office
of the Company, for a new Note or Notes (in accordance with Section 18(d)) representing in the aggregate the outstanding Principal of
this Note, and each such new Note will represent such portion of such outstanding Principal as is designated by the Holder at the time
of such surrender.
(d) Issuance
of New Notes. Whenever the Company is required to issue a new Note pursuant to the terms of this Note, such new Note (i) shall be
of like tenor with this Note, (ii) shall represent, as indicated on the face of such new Note, the Principal remaining outstanding (or
in the case of a new Note being issued pursuant to Section 18(a) or Section 18(c), the Principal designated by the Holder which, when
added to the principal represented by the other new Notes issued in connection with such issuance, does not exceed the Principal remaining
outstanding under this Note immediately prior to such issuance of new Notes), (iii) shall have an issuance date, as indicated on the face
of such new Note, which is the same as the Issuance Date of this Note, (iv) shall have the same rights and conditions as this Note, and
(v) shall represent accrued and unpaid Interest, if any, from the Issuance Date.
(19) REMEDIES,
CHARACTERIZATIONS, OTHER OBLIGATIONS, BREACHES AND INJUNCTIVE RELIEF. The remedies provided in this Note shall be cumulative and in
addition to all other remedies available under this Note and any of the other Transaction Documents at law or in equity (including a decree
of specific performance and/or other injunctive relief). No remedy contained herein shall be deemed a waiver of compliance with the provisions
giving rise to such remedy. Nothing herein shall limit the Holder’s right to pursue actual and consequential damages for any failure by
the Company to comply with the terms of this Note. The Company covenants to the Holder that there shall be no characterization concerning
this instrument other than as expressly provided herein. Amounts set forth or provided for herein with respect to payments, redemption
and the like (and the computation thereof) shall be the amounts to be received by the Holder and shall not, except as expressly provided
herein, be subject to any other obligation of the Company (or the performance thereof). The Company acknowledges that a breach by it of
its obligations hereunder will cause irreparable harm to the Holder and that the remedy at law for any such breach may be inadequate.
The Company therefore agrees that, in the event of any such breach or threatened breach, the Holder shall be entitled, in addition to
all other available remedies, to an injunction restraining any breach, without the necessity of showing economic loss and without any
bond or other security being required.
(20) PAYMENT
OF COLLECTION, ENFORCEMENT AND OTHER COSTS. If (a) this Note is placed in the hands of an attorney for collection or enforcement or
is collected or enforced through any legal proceeding or the Holder otherwise takes action to collect amounts due under this Note or to
enforce the provisions of this Note or (b) there occurs any bankruptcy, reorganization, receivership of the Company or other proceedings
affecting Company creditors’ rights and involving a claim under this Note, then the Company shall pay the costs incurred by the Holder
for such collection, enforcement or action or in connection with such bankruptcy, reorganization, receivership or other proceeding, including,
but not limited to, attorneys’ fees and disbursements. The Company expressly acknowledges and agrees that no amounts due under this Note
shall be affected, or limited, by the fact that the purchase price paid for this Note was less than the original Principal amount hereof.
(21) CONSTRUCTION;
HEADINGS. This Note shall be deemed to be jointly drafted by the Company and all the Purchasers and shall not be construed against
any Person as the drafter hereof. The headings of this Note are for convenience of reference and shall not form part of, or affect the
interpretation of, this Note.
(22) FAILURE
OR INDULGENCE NOT WAIVER. No failure or delay on the part of the Holder in the exercise of any power, right or privilege hereunder
shall operate as a waiver thereof, nor shall any single or partial exercise of any such power, right or privilege preclude other or further
exercise thereof or of any other right, power or privilege. No waiver shall be effective unless it is in writing and signed by an authorized
representative of the waiving party.
(23) DISPUTE
RESOLUTION. In the case of a dispute as to the determination of any Redemption Price, the Company shall pay the applicable
Redemption Price that is not disputed, and the Company shall submit the disputed determinations or arithmetic calculations via
electronic mail within one (1) Business Day of receipt, or deemed receipt, of the Redemption Notice or other event giving rise to
such dispute, as the case may be, to the Holder. If the Holder and the Company are unable to agree upon such determination or
calculation within one (1) Business Day of such disputed determination or arithmetic calculation being submitted to the Holder, then
the Company shall, within one (1) Business Day submit via electronic mail the disputed arithmetic calculation of any Redemption
Price to an independent, outside accountant, selected by the Holder and approved by the Company, such approval not to be
unreasonably withheld, conditioned or delayed. The Company, at the Company’s expense, shall cause the accountant to perform the
determinations or calculations and notify the Company and the Holder of the results no later than five (5) Business Days from the
time it receives the disputed determinations or calculations. Such accountant’s determination or calculation, as the case may be,
shall be binding upon all parties absent demonstrable error.
(a) Notices.
Whenever notice is required to be given under this Note, unless otherwise provided herein, such notice shall be given in accordance with
Section 5.4 of the Securities Purchase Agreement. The Company shall provide the Holder with prompt written notice of all actions taken
pursuant to this Note, including in reasonable detail a description of such action and the reason therefor.
(b) Payments.
Whenever any payment of cash is to be made by the Company to any Person pursuant to this Note, such payment shall be made in lawful money
of the United States of America via wire transfer of immediately available funds to an account designated by the Holder; provided,
that the Holder, upon written notice to the Company, may elect to receive a payment of cash in lawful money of the United States of America
by a check drawn on the account of the Company and sent via overnight courier service to such Person at such address as previously provided
to the Company in writing (which address, in the case of each of the Purchasers, shall initially be as set forth on the signature pages
attached to the Securities Purchase Agreement). Whenever any amount expressed to be due by the terms of this Note is due on any day which
is not a Business Day, the same shall instead be due on the next succeeding day which is a Business Day.
(25) CANCELLATION.
After all Principal, any accrued Interest and any other amounts at any time owed on this Note have been paid in full, this Note shall
automatically be deemed canceled and shall not be reissued, sold or transferred.
(26) WAIVER
OF NOTICE. To the extent permitted by law, the Company hereby waives demand, notice, protest and all other demands and notices in
connection with the delivery, acceptance, performance, default or enforcement of this Note and the Securities Purchase Agreement.
(27) GOVERNING
LAW; JURISDICTION; JURY TRIAL. This Note shall be governed by and construed and enforced in accordance with, and all questions
concerning the construction, validity, interpretation and performance of this Note shall be governed by, the internal laws of the
State of New York, without giving effect to any choice of law or conflict of law provision or rule (whether of the State of New York
or any other jurisdictions) that would cause the application of the laws of any jurisdictions other than the State of New York. The
Company 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, and hereby irrevocably waives, and agrees not to assert in any suit, action or proceeding, any claim
that it is not personally subject to the jurisdiction of any such court, that such suit, action or proceeding is brought in an
inconvenient forum or that the venue of such suit, action or proceeding is improper. The Company 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 to the
Company at the address set forth on the Company’s signature page to the Securities Purchase 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 manner permitted by law. Nothing contained herein shall be deemed or operate to
preclude the Holder from bringing suit or taking other legal action against the Company in any other jurisdiction to collect on the
Company’s obligations to the Holder, to realize on any collateral or any other security for such obligations, or to enforce a
judgment or other court ruling in favor of the Holder. THE COMPANY HEREBY IRREVOCABLY WAIVES ANY RIGHT IT MAY HAVE TO, AND AGREES
NOT TO REQUEST, A JURY TRIAL FOR THE ADJUDICATION OF ANY DISPUTE HEREUNDER OR IN CONNECTION WITH OR ARISING OUT OF THIS NOTE OR ANY
TRANSACTION CONTEMPLATED HEREBY.
(28) SEVERABILITY.
If any provision of this Note is prohibited by law or otherwise determined to be invalid or unenforceable by a court of competent jurisdiction,
the provision that would otherwise be prohibited, invalid or unenforceable shall be deemed amended to apply to the broadest extent that
it would be valid and enforceable, and the invalidity or unenforceability of such provision shall not affect the validity of the remaining
provisions of this Note so long as this Note as so modified continues to express, without material change, the original intentions of
the Company and the Holder as to the subject matter hereof and the prohibited nature, invalidity or unenforceability of the provision(s)
in question does not substantially impair the respective expectations or reciprocal obligations of the Company or the Holder or the practical
realization of the benefits that would otherwise be conferred upon the Company or the Holder. The Company and the Holder will endeavor
in good faith negotiations to replace the prohibited, invalid or unenforceable provision(s) with a valid provision(s), the effect of which
comes as close as possible to that of the prohibited, invalid or unenforceable provision(s).
(29) DISCLOSURE.
Upon receipt or delivery by the Company of any notice in accordance with the terms of this Note, unless the Company has in good faith
determined that the matters relating to such notice do not constitute material, nonpublic information relating to the Company or its Subsidiaries,
the Company shall contemporaneously with any such receipt or delivery publicly disclose such material, nonpublic information on a Current
Report on Form 8-K or otherwise. In the event that the Company believes that a notice contains material, nonpublic information relating
to the Company or its Subsidiaries, the Company so shall indicate to the Holder contemporaneously with delivery of such notice, and in
the absence of any such indication, the Holder shall be allowed to presume that all matters relating to such notice do not constitute
material, nonpublic information relating to the Company or its Subsidiaries.
(30) USURY.
This Note is subject to the express condition that at no time shall the Company be obligated or required to pay interest hereunder
at a rate or in an amount which could subject the Holder to either civil or criminal liability as a result of being in excess of the
maximum interest rate or amount which the Company is permitted by applicable law to contract or agree to pay. If by the terms of
this Note, the Company is at any time required or obligated to pay interest hereunder, including by way of an original issue
discount, at a rate or in an amount in excess of such maximum rate or amount, the rate or amount of interest under this Note shall
be deemed to be immediately reduced to such maximum rate or amount and the interest payable shall be computed at such maximum rate
or be in such maximum amount and all prior interest payments in excess of such maximum rate or amount shall be applied and shall be
deemed to have been payments in reduction of the principal balance of this Note.
(31) GUARANTEE.
Rennova Health, Inc. hereby, jointly and severally, unconditionally and irrevocably, guarantees to Holder the prompt and complete payment
and performance when due (whether at the stated maturity, by acceleration or otherwise) in indefeasible payment in full of the Note.
(32) CERTAIN
DEFINITIONS. For purposes of this Note, the following terms shall have the following meanings:
(a)
“Affiliate” shall have the meaning ascribed to such term in Rule 405 of the Securities Act.
(b)
“Business Day” means any day other than Saturday, Sunday or other day on which commercial banks in The City of
New York are authorized or required by law to remain closed; provided, however, for clarification, commercial banks
shall not be deemed to be authorized or required by law to remain closed due to “stay at home”,
“shelter-in-place”, “non- essential employee” or any other similar orders or restrictions or the closure of
any physical branch locations at the direction of any governmental authority so long as the electronic funds transfer systems
(including for wire transfers) of commercial banks in The City of New York, New York generally are open for use by customers on such
day.
(c) “Change
of Control” means any Fundamental Transaction other than (i) any reorganization, recapitalization or reclassification of the
Common Stock in which holders of the Company’s voting power immediately prior to such reorganization, recapitalization or reclassification
continue after such reorganization, recapitalization or reclassification to hold publicly traded securities and, directly or indirectly,
are the holders of a majority of the voting power of the surviving entity (or entities with the authority or voting power to elect the
members of the board of directors (or their equivalent if other than a corporation) of such entity or entities) after such reorganization,
recapitalization or reclassification or (ii) pursuant to a migratory merger effected solely for the purpose of changing the jurisdiction
of incorporation of the Company.
(d) “Closing
Date” shall have the meaning set forth in the Securities Purchase Agreement, which date is collectively each date the Company
initially issued any Notes.
(e) “Common
Stock” means (i) the Company’s shares of common stock, par value $0.001 per share, and (ii) any capital stock into which such
Common Stock shall be changed or any capital stock resulting from a reorganization, recapitalization or reclassification of such Common
Stock.
(f) “Contingent
Obligation” means, as to any Person, any direct or indirect liability, contingent or otherwise, of that Person with
respect to any Indebtedness, lease, dividend or other obligation of another Person if the primary purpose or intent of the Person
incurring such liability, or the primary effect thereof, is to provide assurance to the obligee of such liability that such
liability will be paid or discharged, or that any agreements relating thereto will be complied with, or that the holders of such
liability will be protected (in whole or in part) against loss with respect thereto.
(g) “Convertible
Securities” means any stock or securities (other than Options) directly or indirectly convertible into or exercisable or exchangeable
for shares of Common Stock.
(h) “Equity Interests”
means (a) all shares of capital stock (whether denominated as common capital stock or preferred capital stock), equity interests, beneficial,
partnership or membership interests, joint venture interests, participations or other ownership or profit interests in or equivalents
(regardless of how designated) of or in a Person (other than an individual), whether voting or non-voting and (b) all securities convertible
into or exchangeable for any of the foregoing and all warrants, Options or other rights to purchase, subscribe for or otherwise acquire
any of the foregoing, whether or not presently convertible, exchangeable or exercisable.
(i)
“Exchange Act” means the Securities Exchange Act of 1934, as amended.
(j) “Fundamental
Transaction” means (A) that the Company shall, directly or indirectly, including through Subsidiaries, Affiliates or
otherwise, in one or more related transactions, (i) consolidate or merge with or into (whether or not the Company is the surviving
corporation) another Subject Entity, or (ii) sell, assign, transfer, convey or otherwise dispose of all or substantially all of the
properties or assets of the Company or any of its “significant subsidiaries” (as defined in Rule 1-02 of Regulation S-X)
to one or more Subject Entities, or (iii) make, or allow one or more Subject Entities to make, or allow the Company to be subject to
or have its Common Stock be subject to or party to one or more Subject Entities making, a purchase, tender or exchange offer that is
accepted by the holders of at least either (x) 50% of the outstanding shares of Common Stock, (y) 50% of the outstanding shares of
Common Stock calculated as if any shares of Common Stock held by all Subject Entities making or party to, or Affiliated with any
Subject Entities making or party to, such purchase, tender or exchange offer were not outstanding; or (z) such number of shares of
Common Stock such that all Subject Entities making or party to, or Affiliated with any Subject Entity making or party to, such
purchase, tender or exchange offer, become collectively the beneficial owners (as defined in Rule 13d-3 under the Exchange Act) of
at least 50% of the outstanding shares of Common Stock, or (iv) consummate a stock purchase agreement or other business combination
(including, without limitation, a reorganization, recapitalization, spin-off or scheme of arrangement) with one or more Subject
Entities whereby such Subject Entities, individually or in the aggregate, acquire, either (x) at least 50% of the outstanding shares
of Common Stock, (y) at least 50% of the outstanding shares of Common Stock calculated as if any shares of Common Stock held by all
the Subject Entities making or party to, or Affiliated with any Subject Entity making or party to, such stock purchase agreement or
other business combination were not outstanding; or (z) such number of shares of Common Stock such that the Subject Entities become
collectively the beneficial owners (as defined in Rule 13d-3 under the Exchange Act) of at least 50% of the outstanding shares of
Common Stock, or (v) reorganize, recapitalize or reclassify its Common Stock, (B) that the Company shall, directly or indirectly,
including through Subsidiaries, Affiliates or otherwise, in one or more related transactions allow any Subject Entity individually
or the Subject Entities in the aggregate to be or become the “beneficial owner” (as defined in Rule 13d-3 under the
Exchange Act), directly or indirectly, whether through acquisition, purchase, assignment, conveyance, tender, tender offer,
exchange, reduction in outstanding shares of Common Stock, merger, consolidation, business combination, reorganization,
recapitalization, spin-off, scheme of arrangement, reorganization, recapitalization or reclassification or otherwise in any manner
whatsoever, of either (x) at least 50% of the aggregate ordinary voting power represented by issued and outstanding Common Stock,
(y) at least 50% of the aggregate ordinary voting power represented by issued and outstanding Common Stock not held by all such
Subject Entities as of the Subscription Date calculated as if any shares of Common Stock held by all such Subject Entities were not
outstanding, or (z) a percentage of the aggregate ordinary voting power represented by issued and outstanding shares of Common Stock
or other equity securities of the Company sufficient to allow such Subject Entities to effect a statutory short form merger or other
transaction requiring other stockholders of the Company to surrender their shares of Common Stock without approval of the
stockholders of the Company or (C) that the Company shall, directly or indirectly, including through Subsidiaries, Affiliates or
otherwise, in one or more related transactions, the issuance of or the entering into any other instrument or transaction structured
in a manner to circumvent, or that circumvents, the intent of this definition in which case this definition shall be construed and
implemented in a manner otherwise than in strict conformity with the terms of this definition to the extent necessary to correct
this definition or any portion of this definition which may be defective or inconsistent with the intended treatment of such
instrument or transaction.
(k) “GAAP”
means United States generally accepted accounting principles, consistently applied during the periods involved.
(l) “Group”
means a “group” as that term is used in Section 13(d) of the Exchange Act and as defined in Rule 13d-5 thereunder.
(m) “Indebtedness”
of any Person means, without duplication (i) all indebtedness for borrowed money, (ii) all obligations issued, undertaken or assumed
as the deferred purchase price of property or services, including (without limitation) “finance leases” in accordance with
GAAP (other than trade payables entered into in the ordinary course of business consistent with past practice), (iii) all reimbursement
or payment obligations with respect to letters of credit, surety bonds and other similar instruments, (iv) all obligations evidenced
by notes, bonds, debentures or similar instruments, including obligations so evidenced incurred in connection with the acquisition of
property, assets or businesses, (v) all indebtedness created or arising under any conditional sale or other title retention agreement,
or incurred as financing, in either case with respect to any property or assets acquired with the proceeds of such indebtedness (even
though the rights and remedies of the seller or bank under such agreement in the event of default are limited to repossession or sale
of such property), (vi) all monetary obligations under any leasing or similar arrangement which, in connection with GAAP, is classified
as a finance lease, (vii) all indebtedness referred to in clauses (i) through (vi) above secured by (or for which the holder of such
Indebtedness has an existing right, contingent or otherwise, to be secured by) any mortgage, deed of trust, lien, pledge, charge, security
interest or other encumbrance of any nature whatsoever in or upon any property or assets (including accounts and contract rights) with
respect to any asset or property owned by any Person, even though the Person which owns such assets or property has not assumed or become
liable for the payment of such indebtedness, and (vii) all Contingent Obligations in respect of indebtedness or obligations of others
of the kinds referred to in clauses (i) through (vii) above.
(n) “Intellectual
Property Rights” shall have the meaning ascribed to such term in the Securities Purchase Agreement.
(o) “Material
Adverse Effect” shall have the meaning ascribed to such term in the Securities Purchase Agreement.
(p) “Options”
means any rights, warrants or options to subscribe for or purchase (i) shares of Common Stock or (ii) Convertible Securities.
(q) “Permitted
Indebtedness” means (i) Indebtedness evidenced by this Note and the Other Notes, (ii) trade payables incurred in the ordinary
course of business and consistent with past practice and (iii) unsecured Indebtedness incurred by the Company that is made expressly subordinate
in right of payment to the Indebtedness evidenced by this Note, as reflected in a written agreement acceptable to the Required Holders
and approved by the Required Holders in writing, and which Indebtedness (a) does not provide at any time for the payment, prepayment,
repayment, repurchase or defeasance, directly or indirectly, of any principal or premium, if any, thereon until ninety-one (91) days after
the Maturity Date or later and (b) includes terms and conditions acceptable to the Required Holders.
(r) “Permitted
Liens” means (i) any Lien for taxes not yet due or delinquent or being contested in good faith by appropriate proceedings
for which adequate reserves have been established in accordance with GAAP, (ii) any statutory Lien arising in the ordinary course of
business by operation of law with respect to a liability that is not yet due or delinquent, (iii) any Lien created by operation of
law, such as materialmen’s liens, mechanics’ liens and other similar liens, arising in the ordinary course of business
with respect to a liability that is not yet due or delinquent or that are being contested in good faith by appropriate proceedings,
(iv) Liens (A) upon or in any equipment acquired or held by the Company or any of its Subsidiaries to secure the purchase price of
such equipment or Indebtedness incurred solely for the purpose of financing the acquisition or lease of such equipment, or (B)
existing on such equipment at the time of its acquisition, provided that the Lien is confined solely to the property so acquired and
improvements thereon, and the proceeds of such equipment, (v) leases or subleases and licenses and sublicenses granted to others in
the ordinary course of the Company’s business, not interfering in any material respect with the business of the Company and
its Subsidiaries taken as a whole, (vi) Liens in favor of customs and revenue authorities arising as a matter of law to secure
payments of custom duties in connection with the importation of goods and (vii) Liens arising from judgments, decrees or attachments
in circumstances not constituting an Event of Default under Section 4(a)(ix).
(s) “Person”
means an individual, a limited liability company, a partnership, a joint venture, a corporation, a trust, an unincorporated organization,
any other entity and any governmental entity or any department or agency thereof.
(t) “Purchaser”
shall have the meaning ascribed to such term in the Securities Purchase Agreement.
(u) “Redemption
Dates” means, collectively, the Event of Default Redemption Dates and the Change of Control Redemption Dates and the Optional
Prepayment Date, as applicable, each of the foregoing, individually, a Redemption Date.
(v) “Redemption
Notices” means, collectively, the Event of Default Redemption Notices and the Change of Control Redemption Notices and the Optional
Prepayment Notice, each of the foregoing, individually, a Redemption Notice.
(w)
“Redemption Premium” means 125%.
(x) “Redemption
Prices” means, collectively, the Event of Default Redemption Prices and the Change of Control Redemption Prices and the Note
Amount being prepaid upon any Optional Prepayment, each of the foregoing, individually, a Redemption Price.
(y) “Related
Fund” means, with respect to any Person, a fund or account managed by such Person or an Affiliate of such Person.
(z) “Required
Holders” means the holders of Notes representing at least a majority of the aggregate principal amount of the Notes then outstanding.
(aa) “SEC”
means the United States Securities and Exchange Commission.
(bb) “Securities
Act” means the Securities Act of 1933, as amended.
(cc) “Securities Purchase Agreement” means that
certain securities purchase agreement dated as of the Subscription Date by and among the Company and the investors listed on the
signature pages attached thereto pursuant to which the Company issued the Notes, as may be amended, amended and restated,
supplemented or otherwise modified from time to time.
(dd) “Subject Entity”
means any Person, Persons or Group or any Affiliate or associate of any such Person, Persons or Group.
(ee) “Subscription Date”
means_____ , 2024.
(ff) “Subsidiary”
shall have the meaning ascribed to such term in the Securities Purchase Agreement.
(gg) “Transaction Documents”
shall have the meaning ascribed to such term in the Securities Purchase Agreement.
[Signature Page Follows]
IN WITNESS WHEREOF, the Company has
caused this Note to be duly executed as of the Issuance Date set out above.
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FOXO TECHNOLOGIES INC. |
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By: |
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Name: |
Mark White |
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Title: |
Interim CEO |
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Address: |
729 Washington Ave. N., Suite 600 Minneapolis, MN 55401 |
Solely with respect to the guarantee obligations
under Section 31:
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RENNOVA HEALTH INC. |
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By: |
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Name: |
Seamus Lagan |
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Title: |
Chief Executive Officer |
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Address: |
400 S. Australian Avenue, West Palm Beach, Florida 33401 |
19
Exhibit 99.1
SECURITIES PURCHASE AGREEMENT
This Securities Purchase
Agreement (this “Agreement”) is dated as of __________, between FOXO Technologies Inc., 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(a)(2) of the Securities Act (as defined below), 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 Notes (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 other than Saturday, Sunday or other day on which commercial banks in The City of New York are authorized
or required by law to remain closed; provided, however, for clarification, commercial banks shall not be deemed to be authorized
or required by law to remain closed due to “stay at home”, “shelter-in-place”, “non-essential employee”
or any other similar orders or restrictions or the closure of any physical branch locations at the direction of any governmental authority
so long as the electronic funds transfer systems (including for wire transfers) of commercial banks in The City of New York are generally
open for use by customers on such day.
“Closing”
means each closing of the purchase and sale of the Securities pursuant to Section 2.1, including the Initial Closing and each Subsequent
Closing (as applicable).
“Closing
Dates” means collectively the Initial Closing Date and any Subsequent Closing Date (as applicable).
“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 Business Legal Advisors LLC, with offices located at 14888 Auburn Sky Drive, Draper, UT 84020.
“Data
Privacy and Security Laws” shall have the meaning ascribed to such term in Section 3.1(mm).
“Disclosure
Time” means, (i) if this Agreement is signed on a day that is not a Trading Day or after 9:00 a.m. (New York City time) and
before midnight (New York City time) on any Trading Day, 9:01 a.m. (New York City time) on the Trading Day immediately following the
date hereof, and (ii) if this Agreement is signed between midnight (New York City time) and 9:00 a.m. (New York City time) on any Trading
Day, no later than 9:01 a.m. (New York City time) on the date hereof.
“Evaluation
Date” shall have the meaning ascribed to such term in Section 3.1(s).
“Exchange
Act” means the Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder.
“FCPA”
means the Foreign Corrupt Practices Act of 1977, as amended.
“GAAP”
shall have the meaning ascribed to such term in Section 3.1(h).
“Indebtedness”
shall have the meaning ascribed to such term in the Notes.
“Initial
Closing” means the initial closing of the purchase and sale of the Securities pursuant to Section 2.1.
“Initial
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 Initial Subscription Amount and (ii)
the Company’s obligations to deliver the Initial Note and the Shares, in each case, have been satisfied or waived.
“Initial
Note” means the Original Issue Discount Senior Note due, subject to the terms therein, within 5 days of the Initial Closing
Date, issued by the Company to the Purchasers hereunder, in the form of Exhibit A attached hereto.
“Initial
Subscription Amount” means, as to each Purchaser, the aggregate amount to be paid for Initial Note and Shares purchased hereunder
as specified below such Purchaser’s name on the signature page of this Agreement and next to the heading “Initial Subscription
Amount,” in United States dollars and in immediately available funds.
“Intellectual
Property Rights” shall have the meaning ascribed to such term in Section 3.1(p).
“IT Systems”
shall have the meaning ascribed to such term in Section 3.1(mm).
“Legend
Removal Date” shall have the meaning ascribed to such term in Section 4.1(c).
“Lien”
means any lien, mortgage, pledge, assignment, security interest, charge or encumbrance of any kind (including any agreement to give any
of the foregoing, any conditional sale or other title retention agreement, and any lease in the nature thereof) and any option, trust
or other preferential arrangement having the practical effect of any of the foregoing.
“Material
Adverse Effect” shall have the meaning assigned to such term in Section 3.1(b).
“Material
Permits” shall have the meaning ascribed to such term in Section 3.1(n).
“Maximum
Rate” shall have the meaning ascribed to such term in Section 5.17.
“Myrtle”
means Myrtle Recovery Centers, Inc., a Tennessee corporation that is a subsidiary of the Company pursuant to the Stock Exchange Agreement
dated June 10, 2024 between the Company and Myrtle.
“Notes”
means collectively the Initial Note and each Subsequent Note issued by the Company to the Purchasers hereunder.
“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.
“Personal
Data” shall have the meaning ascribed to such term in Section 3.1(mm).
“Principal
Amount” means, as to each Purchaser, the amounts set forth below such Purchaser’s signature block on the signature pages
hereto next to the heading “Principal Amount,” in United States Dollars, which shall equal such Purchaser’s Subscription
Amount multiplied by 1.12
“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.
“Processing”
shall have the meaning ascribed to such term in Section 3.1(mm).
“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.
“Required
Approvals” shall have the meaning ascribed to such term in Section 3.1(e).
“Required
Holders” means (I) prior to the Closing Date, each of the Purchasers and (II) on or after the Closing Date, holders of at least
a majority of the aggregate Principal Amount of Notes issued.
“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.
“Rule
144” means Rule 144 promulgated by the Commission pursuant to the Securities Act, as such Rule may be amended from time to
time, or any similar rule or regulation hereafter adopted by the Commission having substantially the same 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 Notes and the Shares.
“Securities
Act” means the Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder.
“Shares”
means the 1,108,755 Class A shares of Common Stock issuable pursuant to this Agreement.
“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 locating and/or borrowing shares of Common Stock).
“Standard
Settlement Period” shall have the meaning ascribed to such term in Section 4.1(c).
“Subscription
Amount” means, collectively as to each Purchaser, the Initial Subscription Amount and the Subsequent Subscription Amounts.
“Subsequent
Closing” means after the Initial Closing, each subsequent closing (as applicable) of the purchase and sale of the Subsequent
Note pursuant to Section 2.1.
“Subsequent
Closing Date” means the Trading Day on which (i) the Purchasers’ obligations to pay any Subsequent Subscription Amount
and (ii) the Company’s obligations to deliver any Subsequent Note, in each case, have been satisfied or waived.
“Subsequent
Note” means each Original Issue Discount Senior Note due, subject to the terms therein, within 5 days of each Subsequent Closing
Date, issued by the Company to the Purchasers hereunder, in the form of Exhibit A attached hereto.
“Subsequent
Subscription Amounts” means, as to each Purchaser, the aggregate amount to be paid for each Subsequent Note purchased hereunder
as specified below such Purchaser’s name on the signature page of this Agreement and next to the heading “Subsequent Subscription
Amounts,” in United States dollars and in immediately available funds.
“Subsidiary”
means any subsidiary of the Company as set forth in the SEC Reports and shall, where applicable, also include any direct or indirect
subsidiary of the Company formed or acquired after the date hereof. “Subsidiary” of any Person shall include any corporation,
limited or general partnership, limited liability company, trust, estate, association, joint venture or other business entity (a) the
accounts of which would be consolidated with those of such Person in such Person’s consolidated financial statements if such financial
statements were prepared in accordance with GAAP or (b) of which more than 50% of (i) the outstanding equity interests having (in the
absence of contingencies) ordinary voting power to elect a majority of the board of directors of such Person, (ii) in the case of a partnership
or limited liability company, the interest in the capital or profits of such partnership or limited liability company or (iii) in the
case of a trust, estate, association, joint venture or other entity, the beneficial interest in such trust, estate, association or other
entity business is, at the time of determination, owned or controlled directly or indirectly through one or more intermediaries, by such
Person.
“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 American, the Nasdaq Capital Market, the Nasdaq Global Market, the Nasdaq Global Select Market, the New York Stock
Exchange, the OTCQB or the OTCQX (or any successors to any of the foregoing).
“Transaction
Documents” means this Agreement, the Notes and all exhibits and schedules thereto and hereto and any other documents or agreements
executed in connection with the transactions contemplated hereunder.
“Transfer
Agent” means Continental Stock Transfer and Trust Company, the current transfer agent of the Company and any successor transfer
agent of the Company.
“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 OTCQB or OTCQX is not a Trading Market, the volume weighted average
price of the Common Stock for such date (or the nearest preceding date) on OTCQB or OTCQX as applicable, (c) if the Common Stock is not
then listed or quoted for trading on OTCQB or OTCQX and if prices for the Common Stock are then reported on the Pink Open Market (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 Required Holders then outstanding and reasonably acceptable to the Company, the fees and expenses of which
shall be paid by the Company.
ARTICLE II.
PURCHASE AND SALE
2.1 Closings.
(a) On the Initial Closing
Date, upon the terms and subject to the conditions set forth herein, the Company agrees to sell, and the Purchasers, severally and not
jointly, agree to purchase, up to an aggregate of $840,000 in principal amount of the Notes. Each Purchaser shall deliver to the Company’s
bank accounts specified in the Company’s wire instructions, as set forth in a letter addressed to the Purchasers on the Company’s
letterhead and executed by the Company’s Chief Financial Officer or Chief Executive Officer, via wire transfer, immediately available
funds equal to such Purchaser’s Initial Subscription Amount as set forth on the signature page hereto executed by such Purchaser,
and the Company shall deliver to each Purchaser its respective Initial Note and Shares, 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 Initial Closing. Upon satisfaction
of the covenants and conditions set forth in Sections 2.2 and 2.3, the Initial Closing shall take place remotely by electronic transfer
of the Initial Closing documentation.
(b) Pursuant to an agreement
by the Company to acquire (the “Acquisition”) the shares of common stock of Rennova Community Health, Inc., a Florida corporation
(“RCHI”), from Rennova Health, Inc., a Delaware corporation (“Rennova”), the Company is required to file a preliminary
proxy statement or information statement (the “Filing”) with the Securities and Exchange Commission (the “SEC”)
relating to the approval by the Company’s stockholders of the Acquisition and all transactions contemplated thereby. Upon the Company
effectuating the Filing, the conditions for the first Subsequent Closing shall be satisfied and on the first Subsequent Closing Date,
upon the terms and subject to the conditions set forth herein, the Company agrees to sell, and the Purchasers, severally and not jointly,
agree to purchase, up to an aggregate of $280,000 in principal amount of Subsequent Notes. Each Purchaser shall deliver to the Company’s
bank accounts specified in the Company’s wire instructions, as set forth in a letter addressed to the Purchasers on the Company’s
letterhead and executed by the Company’s Chief Financial Officer or Chief Executive Officer, via wire transfer, immediately available
funds equal to such Purchaser’s first Subsequent Subscription Amount as set forth on the signature page hereto executed by such
Purchaser, and the Company shall deliver to each Purchaser its respective Subsequent Note, as determined pursuant to Section 2.2(c),
and the Company and each Purchaser shall deliver the other items set forth in Section 2.2 deliverable at the Subsequent Closing. Upon
satisfaction of the covenants and conditions set forth in Sections 2.2 and 2.3, the first Subsequent Closing shall take place remotely
by electronic transfer of the Subsequent Closing documentation.
(c) Upon the closing of the
Acquisition, the conditions for the second Subsequent Closing shall be satisfied and on the second Subsequent Closing Date, upon the
terms and subject to the conditions set forth herein, the Company agrees to sell, and the Purchasers, severally and not jointly, agree
to purchase, up to an aggregate of $1,120,000 in principal amount of Subsequent Notes. Each Purchaser shall deliver to the Company’s
bank accounts specified in the Company’s wire instructions, as set forth in a letter addressed to the Purchasers on the Company’s
letterhead and executed by the Company’s Chief Financial Officer or Chief Executive Officer, via wire transfer, immediately available
funds equal to such Purchaser’s second Subsequent Subscription Amount as set forth on the signature page hereto executed by such
Purchaser, and the Company shall deliver to each Purchaser its respective Subsequent Note, as determined pursuant to Section 2.2(c),
and the Company and each Purchaser shall deliver the other items set forth in Section 2.2 deliverable at the Subsequent Closing. Upon
satisfaction of the covenants and conditions set forth in Sections 2.2 and 2.3, the second Subsequent Closing shall take place remotely
by electronic transfer of the Subsequent Closing documentation.
(d) Upon the filing of a registration
statement by the Company with the SEC relating to the resale by the Purchasers (and any affiliate) of all shares of Class A Common Stock,
par value $0.0001 per share, of the Company beneficially owned by the Purchasers (and any affiliate), including without limitation the
Shares, the conditions for the third Subsequent Closing shall be satisfied and on the third Subsequent Closing Date, upon the terms and
subject to the conditions set forth herein, the Company agrees to sell, and the Purchasers, severally and not jointly, agree to purchase,
up to an aggregate of $560,000 in principal amount of Subsequent Notes. Each Purchaser shall deliver to the Company’s bank accounts
specified in the Company’s wire instructions, as set forth in a letter addressed to the Purchasers on the Company’s letterhead
and executed by the Company’s Chief Financial Officer or Chief Executive Officer, via wire transfer, immediately available funds
equal to such Purchaser’s third Subsequent Subscription Amount as set forth on the signature page hereto executed by such Purchaser,
and the Company shall deliver to each Purchaser its respective Subsequent Note, as determined pursuant to Section 2.2(c), and the Company
and each Purchaser shall deliver the other items set forth in Section 2.2 deliverable at the Subsequent Closing. Upon satisfaction of
the covenants and conditions set forth in Sections 2.2 and 2.3, the third Subsequent Closing shall take place remotely by electronic
transfer of the Subsequent Closing documentation.
2.2 Deliveries.
(a) On or prior
to the Initial Closing Date (other than with respect to 2.2(a)(iii)), the Company shall deliver or cause to be delivered to each Purchaser
the following:
(i) this Agreement
duly executed by the Company;
(ii) an Initial Note
with a principal amount equal to such Purchaser’s Initial Subscription Amount multiplied by 1.12, registered in the name of such
Purchaser;
(iii) 1,108,755 Shares,
which shall be issued within 10 days od the Initial Closing Date and shall equal 9.99% of the number of Class A shares of common stock
outstanding immediately after giving effect to the issuance of the Shares.
(iv) the Company
shall have provided each Purchaser with the wire instructions of the Company, on Company letterhead and executed by the Chief Executive
Officer or Chief Financial Officer; and
(v) the Company shall
have delivered to such Purchaser such other documents relating to the transactions contemplated by this Agreement as such Purchaser or
its counsel may reasonably request.
(b) On or prior
to the Initial Closing Date, each Purchaser shall deliver or cause to be delivered to the Company the following:
(i) this Agreement
duly executed by such Purchaser; and
(ii) such Purchaser’s
Initial Subscription Amount by wire transfer to the account specified in writing by the Company.
(c) On or prior
to each Subsequent Closing Date, the Company shall deliver or cause to be delivered to each Purchaser the following:
(i) A Subsequent
Note with a principal amount equal to such Purchaser’s applicable Subsequent Subscription Amount multiplied by 1.12, registered
in the name of such Purchaser;
(ii) the Company
shall have provided each Purchaser with the wire instructions of the Company, on Company letterhead and executed by the Chief Executive
Officer or Chief Financial Officer; and
(iii) the Company
shall have delivered to such Purchaser such other documents relating to the transactions contemplated by this Agreement as such Purchaser
or its counsel may reasonably request.
(d) On or prior
to each Subsequent Closing Date, each Purchaser shall deliver or cause to be delivered to the Company the following:
(i) such Purchaser’s
applicable Subsequent 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 (or, to the extent representations or warranties are qualified by materiality, in all 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 in all material respects (or, to the extent representations or warranties are qualified by materiality, in all respects)
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 (or, to the extent representations or warranties are qualified by materiality or Material Adverse Effect, in
all respects) when made and on the Closing Date of the representations and warranties of the Company contained herein (unless as of a
specific date therein in which case they shall be accurate in all material respects or, to the extent representations or warranties are
qualified by materiality or Material Adverse Effect, in all respects) as of such date;
(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;
(v) approval of a
listing application from the New York Stock Exchange approving the issuance of the Shares in accordance with the terms of the Transaction
Documents; and
(vi) 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. 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 in the SEC Reports. 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.
(b) Organization
and Qualification. Except as set forth on Schedule 3.1(b), 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, would 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.
(i) 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 or (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 to which it is a party,
the issuance and sale of the Securities and the consummation by it of the transactions contemplated hereby and thereby do not and will
not (i) 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, or (ii) subject to the Required Approvals, 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, anti-dilution or similar
adjustments, 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 would 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 notice and/or application(s) to each applicable Trading Market for the issuance and
sale of the Securities and the listing of the Shares for trading thereon, (iii) the filing of Form D with the Commission and such filings
as are required to be made under applicable state securities laws and (iv) the consents that shall be obtained prior to Closing (collectively,
the “Required Approvals”).
(f) Issuance
of the Securities. The Securities are duly authorized and, when issued and paid for in accordance with the applicable Transaction
Documents, will be duly and validly issued, fully paid and nonassessable, free and clear of all Liens imposed by the Company other than
restrictions on transfer provided for in the Transaction Documents or under federal or state securities laws. The Shares, 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 other than restrictions on transfer provided for in the Transaction Documents. The Company has reserved
from its duly authorized capital stock a number of shares of Common Stock for issuance of the Shares at least equal to the Required Minimum
on the date hereof.
(g) Capitalization.
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 award plans, the issuance of shares of Common Stock or stock
options to employees, directors and consultants pursuant to the Company’s employee stock award 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. The issuance and sale of the Securities will not obligate the Company or any Subsidiary to
issue shares of Common Stock or other securities to any Person (other than the Purchasers). There are no outstanding securities or instruments
of the Company or any Subsidiary with any provision that adjusts the exercise, conversion, exchange or reset price of such security or
instrument upon an issuance of securities by the Company or any Subsidiary. There are no outstanding securities or instruments of the
Company or any Subsidiary that contain any redemption or similar provisions, and there are no contracts, commitments, understandings
or arrangements by which the Company or any Subsidiary is or may become bound to redeem a security of the Company or such Subsidiary.
The Company does not have any stock appreciation rights or “phantom stock” plans or agreements or any similar plan or agreement.
All of the outstanding shares of capital stock of the Company are duly authorized, validly issued, fully paid and nonassessable, have
been issued in compliance with all federal and state securities laws, and none of such outstanding shares was issued in violation of
any preemptive rights or similar rights to subscribe for or purchase securities. No further approval or authorization of any stockholder,
the Board of Directors or others is required for the issuance and sale of the Securities. There are no 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. Except as set forth on Schedule 3.1(h), 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 (except as set forth in the SEC Reports) 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 disclosed in the SEC Reports (i) there has been no event, occurrence or development that has had or that would
reasonably be expected to result in a Material Adverse Effect, (ii) the Company has not incurred any liabilities (contingent or otherwise)
other than (A) trade payables and accrued expenses incurred in the ordinary course of business consistent with past practice and (B)
liabilities not required to be reflected in the Company’s financial statements pursuant to GAAP or disclosed in filings made with
the 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 award plans. The Company does not have pending before the Commission any request for confidential treatment
of information (excluding redactions permitted by Item 6.01 of Regulation S-K). Except for the issuance of the Securities contemplated
by this Agreement, no event, liability, fact, circumstance, occurrence or development has occurred or exists or is reasonably expected
to occur or exist with respect to the Company or its Subsidiaries or their respective businesses, prospects, properties, operations,
assets or financial condition, that would be required to be disclosed by the Company under applicable securities laws at the time this
representation is made or deemed made that has not been publicly disclosed prior to the date that this representation is made.
(j) Litigation.
There is no action, suit, proceeding or investigation pending 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”) that (i) adversely affects or challenges the legality, validity or enforceability
of any of the Transaction Documents or the Securities or (ii) would, if there were an unfavorable decision, have or reasonably be expected
to result in a Material Adverse Effect. 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 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 would
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 would 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 would not have or reasonably be expected to result in a Material
Adverse Effect.
(m) Environmental
Laws. The Company and its Subsidiaries (i) are in compliance with all federal, state, local and foreign laws relating to pollution
or protection of human health or the environment (including ambient air, surface water, groundwater, land surface or subsurface strata),
including laws relating to emissions, discharges, releases or threatened releases of chemicals, pollutants, contaminants, or toxic or
hazardous substances or wastes (collectively, “Hazardous Materials”) into the environment, or otherwise relating to
the manufacture, processing, distribution, use, treatment, storage, disposal, transport or handling of Hazardous Materials, as well as
all authorizations, codes, decrees, demands, or demand letters, injunctions, judgments, licenses, notices or notice letters, orders,
permits, plans or regulations, issued, entered, promulgated or approved thereunder (“Environmental Laws”); (ii) have
received all permits licenses or other approvals required of them under applicable Environmental Laws to conduct their respective businesses;
and (iii) are in compliance with all terms and conditions of any such permit, license or approval where in each clause (i), (ii) and
(iii), the failure to so comply would be reasonably expected to have, individually or in the aggregate, a Material Adverse Effect.
(n) Regulatory
Permits. The Company and the Subsidiaries possess all certificates, authorizations and permits issued by the appropriate federal,
state, local or foreign regulatory authorities necessary to conduct their respective businesses as described in the SEC Reports, except
where the failure to possess such permits could not reasonably be expected to result in a Material Adverse Effect (“Material
Permits”), and neither the Company nor any Subsidiary has received any notice of proceedings relating to the revocation or
modification of any Material Permit.
(o) Title to
Assets. The Company and the Subsidiaries have good and marketable title in fee simple to all real property owned by them and good
and marketable title in all personal property owned by them that is material to the business of the Company and the Subsidiaries, in
each case free and clear of all Liens, except for (i) Liens as do not materially affect the value of such property and do not materially
interfere with the use made and proposed to be made of such property by the Company and the Subsidiaries and (ii) Liens for the payment
of federal, state or other taxes, for which appropriate reserves have been made therefor in accordance with GAAP and, the payment of
which is neither delinquent nor subject to penalties. Any real property and facilities held under lease by the Company and the Subsidiaries
are held by them under valid, subsisting and enforceable leases with which the Company and the Subsidiaries are in compliance.
(p) Intellectual
Property. Except as disclosed in the SEC Reports, the Company and its Subsidiaries exclusively own (free and clear of all liens,
encumbrances and defects) or possess a valid license or other lawful right to use all Intellectual Property Rights necessary, used or
held for use to conduct its business as presently conducted and as presently proposed to be conducted. Each item of such Intellectual
Property Rights is valid and enforceable. Each of the licenses (in-bound or out-bound) of Intellectual Property Rights or other contracts
(including settlement agreements) is valid and enforceable, and none of the Company or its Subsidiaries and, to the knowledge of the
Company and its Subsidiaries, none of the counterparties to any such contract, is in default or breach thereunder or thereof. The conduct
of the business of the Company and its Subsidiaries does not infringe, misappropriate or otherwise violate or conflict with the Intellectual
Property Rights of others. To the knowledge of the Company and its Subsidiaries, no third party is infringing, misappropriating or otherwise
conflicting with its Intellectual Property Rights. Except as disclosed in the SEC Reports, none of the Company or its Subsidiaries are
aware of any facts or circumstances which might give rise to any of the foregoing infringements, misappropriations or other conflicts,
or claims, actions or proceedings. Each of the Company and its Subsidiaries has taken reasonable measures to protect the secrecy, confidentiality
and value of all of its Intellectual Property Rights, as applicable, and, to its knowledge, no unauthorized disclosure of any information
comprising any Intellectual Property Rights has occurred. All present and former employees, consultants and independent contractors of
each of the Company and its Subsidiaries that have been involved in the development of any Intellectual Property Rights used in the business
of the Company and its Subsidiaries have entered into written agreements under which such Persons (A) agree to protect the trade secrets,
know-how and other confidential information of the Company and its Subsidiaries, as applicable, and (B) assign to one of the Company
or its Subsidiaries, as applicable, all right, title and interest in and to all Intellectual Property Rights created by such Person in
the course of his, her or its employment or other engagement by the Company or any of its Subsidiaries. For purposes of this Agreement,
“Intellectual Property Rights” means all intellectual property and proprietary rights, including all (i) trademarks,
trade names, service marks, service names, domain names, and other designation of origin, together with all goodwill associated therewith,
(ii) original works of authorship and copyrights, (iii) patents and patent applications, together with all divisionals, continuations,
continuations-in-part, reissues and reexaminations thereof, including all rights to file applications for patent, (iv) trade secrets,
know-how and other confidential information, (v) software, including data, databases and documentation therefor, and (vi) inventions,
licenses, approvals and governmental authorizations.
(q) Insurance.
The Company and the Subsidiaries are insured by insurers of recognized financial responsibility against such losses and risks and in
such amounts as are prudent and customary in the businesses in which the Company and the Subsidiaries are engaged, 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.
(r) 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 award plan of the Company.
(s) Sarbanes-Oxley;
Internal Accounting Controls. The Company and the Subsidiaries are in compliance in all material respects with any and all applicable
requirements of the Sarbanes-Oxley Act of 2002, as amended, 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. Except
as set forth in the SEC Reports, 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) that
have materially affected, or is reasonably likely to materially affect, the internal control over financial reporting of the Company
and its Subsidiaries.
(t) Certain Fees.
No brokerage or finder’s fees or commissions are or will be payable by the Company or any Subsidiaries 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.
(u) 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.
(v) 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.
(w) [Intentionally
Omitted]
(x) 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.
Except as disclosed in the SEC Reports, 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 Common Stock is currently eligible for electronic transfer through the Depository
Trust Company or another established clearing corporation and the Company is current in payment of the fees to the Depository Trust Company
(or such other established clearing corporation) in connection with such electronic transfer.
(y) Application
of Takeover Protections. Assuming the accuracy of the representations and warranties of Purchasers in Section 3.2(h), 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.
(z) 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 for purposes of U.S. federal securities laws. 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, is true and correct in all material respects 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
the light of the circumstances under which they were made and when 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 the 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.
(aa) 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.
(bb) Solvency.
Based on the consolidated financial condition of the Company as of the Closing Date, 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 (at the
carrying value of such assets in the SEC Reports), 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. This representation
and warranty is expressly qualified and limited by the going concern qualification expressed by the Company’s auditors in their
opinions pertaining to any of the Company’s financial statements and related disclosure in the Company’s SEC Reports filed
subsequent to such period.
(cc) 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.
(dd) 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.
(ee) 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.
(ff) Accountants.
To the knowledge and belief of the Company, the Company’s 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 December 31, 2024.
(gg) Seniority.
As of the Closing Date, no Indebtedness or other claim against the Company is senior to the Notes in right of payment or security, whether
with respect to interest or upon liquidation or dissolution, or otherwise, other than indebtedness secured by purchase money security
interests (which is senior only as to underlying assets covered thereby) and capital lease obligations (which is senior only as to the
property covered thereby). The Notes and all other obligations of the Company of any kind whatsoever under or in respect of the Notes
(the “Senior Obligations”) constitute senior unsubordinated obligations of the Company, other than any obligations
which have priority under applicable law.
(hh) No Disagreements
with Accountants and Lawyers. There are no disagreements of any kind presently existing, or reasonably anticipated by the Company
to arise, between the Company and the accountants and lawyers formerly or presently employed by the Company and the Company is current
with respect to any fees owed to its accountants and lawyers which could affect the Company’s ability to perform any of its obligations
under any of the Transaction Documents.
(ii) 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.
(jj) Acknowledgment
Regarding Purchaser’s Trading Activity. Anything in this Agreement or elsewhere herein to the contrary notwithstanding (except
for Sections 3.2(g) and 4.14 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 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.
(kk) 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).
(ll) Stock Option
Plans. Each stock option granted by the Company under the Company’s stock award plan was granted (i) in accordance with the
terms of the Company’s stock award 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 award 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.
(mm) IT Systems;
Data Privacy and Security. The information technology and computer systems, including the software, firmware, hardware, equipment,
networks, data communication lines, interfaces, databases, storage media, websites, platforms and related systems, owned, licensed or
leased by the Company and its Subsidiaries (collectively, “IT Systems”) are sufficient in all material respects for
the conduct of each of the business of the Company and its Subsidiaries, and to the knowledge of each of the Company and its Subsidiaries,
do not contain any “viruses”, “worms”, “time-bombs”, “key-locks”, or any other devices
intentionally designed to disrupt or interfere with the operation of any of the IT Systems; and during the last two (2) years, there
have been no material failures, breakdowns, continued substandard performance or other adverse events affecting any of the IT Systems.
Each of the Company and its Subsidiaries has and maintains commercially reasonable business continuity and disaster recovery plans, procedures
and facilities appropriate for its business and has taken commercially reasonable steps to safeguard the integrity and security of IT
Systems, including all data stored therein, and to the knowledge of each of the Company and its Subsidiaries, there has been no unauthorized
access, or any intrusions or breaches, of any of the IT Systems, including any data stored therein, during the last two (2) years. Each
of the Company and its Subsidiaries is, and during the last three (3) years has been, in compliance in all material respects with all
Data Privacy and Security Laws applicable to it. Each of the Company and its Subsidiaries has maintained and posted, and complied with
the terms of, all privacy notices pursuant to Data Privacy and Security Laws. Each of the Company and its Subsidiaries has commercially
reasonable security measures in place designed to protect all Personal Data under its control or in its possession from unauthorized
use, access, modification or destruction. During the last three (3) years, none of the Company nor its Subsidiaries has suffered any
breach in security or other incident that has permitted any unauthorized access to the Personal Data under its control or possession.
Each of the Company and its Subsidiaries maintains, and has remained in compliance, in all material respects, with, a comprehensive written
information security program that includes commercially reasonable administrative, physical and technical measures intended to protect
the confidentiality, integrity, availability and security of Personal Data in is possession or under its control and IT Systems against
any unauthorized control, use, access, interruption, modification or corruption and to ensure the continued, uninterrupted and error-free
operation of IT Systems. There are no material claims, actions or proceedings against or affecting any of the Company or its Subsidiaries
pending, threatened in writing, relating to or arising under Data Privacy and Security Laws. None of the Company nor its Subsidiaries
has received any written notices from the Department of Justice, U.S. Department of Education, Federal Trade Commission, or the Attorney
General of any state, or any equivalent foreign governmental authority, relating to possible violations of Data Privacy and Security
Laws. For purposes of this Agreement, (i) “Data Privacy and Security Laws” shall mean (a) all applicable laws relating
to the Processing of Personal Data or otherwise relating to privacy, data protection, data security, cyber security, breach notification
or data localization, and (b) all published policies of the Company and its Subsidiaries relating to the Processing of Personal Data
or otherwise relating to privacy, data protection, data security, cyber security, breach notification or data localization; (ii) “Processing”
shall mean the collection, use, storage, processing, recording, distribution, transfer, import, export, protection, disposal or disclosure
or other activity regarding or operations performed on data or information (whether electronically or in any other form or medium); and
(iii) “Personal Data” shall mean any information that, alone or in combination with other information held by the
Company and its Subsidiaries, identifies or could reasonably be associated with an individual, including any individual’s name,
street address, telephone number, e-mail address, photograph, social security number, driver’s license number, passport number,
customer or account number, biometrics, IP address, geolocation data or persistent device identifier, or any other information that is
otherwise considered personal information, personal data, protected health information by applicable Data Privacy and Security Laws.
(nn) Office
of Foreign Assets Control. Neither the Company nor any Subsidiary nor, to the Company’s knowledge, any director, officer, agent,
employee or affiliate of the Company or any Subsidiary is currently subject to any U.S. sanctions administered by the Office of Foreign
Assets Control of the U.S. Treasury Department (“OFAC”).
(oo) U.S. Real
Property Holding Corporation. The Company is not and has never been a U.S. real property holding corporation within the meaning of
Section 897 of the Internal Revenue Code of 1986, as amended, and the Company shall so certify upon Purchaser’s request.
(pp) Bank Holding
Company Act. Neither the Company nor any of its Subsidiaries or Affiliates is subject to the Bank Holding Company Act of 1956, as
amended (the “BHCA”) and to regulation by the Board of Governors of the Federal Reserve System (the “Federal
Reserve”). Neither the Company nor any of its Subsidiaries or Affiliates owns or controls, directly or indirectly, five percent
(5%) or more of the outstanding shares of any class of voting securities or twenty-five percent or more of the total equity of a bank
or any entity that is subject to the BHCA and to regulation by the Federal Reserve. Neither the Company nor any of its Subsidiaries or
Affiliates exercises a controlling influence over the management or policies of a bank or any entity that is subject to the BHCA and
to regulation by the Federal Reserve.
(qq) 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 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.
(rr) No Disqualification
Events. With respect to the Securities to be offered and sold hereunder in reliance on Rule 506 under the Securities Act, none of
the Company, any of its predecessors, any affiliated issuer, any director, executive officer, other officer of the Company participating
in the offering hereunder, any beneficial owner of 20% or more of the Company’s outstanding voting equity securities, calculated
on the basis of voting power, nor any promoter (as that term is defined in Rule 405 under the Securities Act) connected with the Company
in any capacity at the time of sale (each, an “Issuer Covered Person” and, together, “Issuer Covered Persons”)
is subject to any of the “Bad Actor” disqualifications described in Rule 506(d)(1)(i) to (viii) under the Securities Act
(a “Disqualification Event”), except for a Disqualification Event covered by Rule 506(d)(2) or (d)(3). The Company
has exercised reasonable care to determine whether any Issuer Covered Person is subject to a Disqualification Event. The Company has
complied, to the extent applicable, with its disclosure obligations under Rule 506(e), and has furnished to the Purchasers a copy of
any disclosures provided thereunder.
(ss) Other Covered
Persons. The Company is not aware of any person (other than any Issuer Covered Person) that has been or will be paid (directly or
indirectly) remuneration for solicitation of purchasers in connection with the sale of any Securities.
(tt) Notice
of Disqualification Events. The Company will notify the Purchasers in writing, prior to the Closing Date of (i) any Disqualification
Event relating to any Issuer Covered Person and (ii) any event that would, with the passage of time, become a Disqualification Event
relating to any Issuer Covered Person.
(uu) Shell Company Status. The
Company is not, and has never been, an issuer identified in, or subject to, Rule 144(i)(1) of 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, in which case they shall be accurate
as of such date):
(a) Organization;
Authority. Such Purchaser is either an individual or an entity duly incorporated or formed, validly existing and in good standing
under the laws of the jurisdiction of its incorporation or formation with full right, corporate, partnership, limited liability company
or similar power and authority to enter into and to consummate the transactions contemplated by 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 or (iii) insofar as indemnification and contribution provisions may be limited by applicable
law.
(b) Own Account.
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, an “accredited investor”
as defined in Rule 501(a)(1), (a)(2), (a)(3), (a)(7), (a)(8), (a)(9), (a)(12) or (a)(13) under the Securities 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) General
Solicitation. Such Purchaser is not, to such Purchaser’s knowledge, purchasing the Securities as a result of any advertisement,
article, notice or other communication regarding the Securities published in any newspaper, magazine or similar media or broadcast over
television or radio or presented at any seminar or, to the knowledge of such Purchaser, any other general solicitation or general advertisement.
(f) Access to
Information. Such Purchaser acknowledges that it has had the opportunity to review the Transaction Documents (including all exhibits
and schedules thereto) and the SEC Reports and has been afforded (i) the opportunity to ask such questions as it has deemed necessary
of, and to receive answers from, representatives of the Company concerning the terms and conditions of the offering of the Securities
and the merits and risks of investing in the Securities; (ii) access to information about the Company and its financial condition, results
of operations, business, properties, management and prospects sufficient to enable it to evaluate its investment; and (iii) the opportunity
to obtain such additional information that the Company possesses or can acquire without unreasonable effort or expense that is necessary
to make an informed investment decision with respect to the investment.
(g) Certain
Transactions and Confidentiality. Other than consummating the transactions contemplated hereunder, such Purchaser has not, nor has
any Person acting on behalf of or pursuant to any understanding with such Purchaser, directly or indirectly executed any purchases or
sales, including Short Sales, of the securities of the Company during the period commencing as of the time that such Purchaser first
received a term sheet (written or oral) from the Company or any other Person representing the Company setting forth the material terms
of the transactions contemplated hereunder and ending immediately prior to the execution hereof. Notwithstanding the foregoing, in the
case of a Purchaser that is a multi-managed investment vehicle whereby separate portfolio managers manage separate portions of such Purchaser’s
assets and the portfolio managers have no direct knowledge of the investment decisions made by the portfolio managers managing other
portions of such Purchaser’s assets, the representation set forth above shall only apply with respect to the portion of assets
managed by the portfolio manager that made the investment decision to purchase the Securities covered by this Agreement. Other than to
other Persons party to this Agreement or to such Purchaser’s representatives, including, without limitation, its officers, directors,
partners, legal and other advisors, employees, agents and Affiliates, such Purchaser has maintained the confidentiality of all disclosures
made to it in connection with this transaction (including the existence and terms of this transaction). Notwithstanding the foregoing,
for the avoidance of doubt, nothing contained herein shall constitute a representation or warranty against, or a prohibition of, any
actions with respect to the borrowing of, arrangement to borrow, identification of the availability of, and/or securing of, securities
of the Company in order for such Purchaser (or its broker or other financial representative) to effect Short Sales or similar transactions
in the future.
The Company acknowledges and agrees that the
representations contained in this Section 3.2 shall not modify, amend or affect such Purchaser’s right to rely on the Company’s
representations and warranties contained in this Agreement or any representations and warranties contained in any other Transaction Document
or any other document or instrument executed and/or delivered in connection with this Agreement or the consummation of the transactions
contemplated hereby. Notwithstanding the foregoing, for the avoidance of doubt, nothing contained herein shall constitute a representation
or warranty, or preclude any actions, with respect to locating or borrowing shares in order to effect Short Sales or similar transactions
in the future.
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 shall have the
rights and obligations of a Purchaser under this 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 substantially the following
form:
[NEITHER] THIS SECURITY [NOR THE SECURITIES
INTO WHICH THIS SECURITY IS [EXERCISABLE] 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. THIS SECURITY [AND THE SECURITIES ISSUABLE UPON [EXERCISE] OF THIS SECURITY] MAY BE PLEDGED IN
CONNECTION WITH A BONA FIDE MARGIN ACCOUNT WITH A REGISTERED BROKER-DEALER OR OTHER LOAN WITH A FINANCIAL INSTITUTION THAT IS AN “ACCREDITED
INVESTOR” AS DEFINED IN RULE 501(a) UNDER THE SECURITIES ACT OR OTHER LOAN SECURED BY SUCH SECURITIES.
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, 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, 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 Shares shall not contain any legend (including the legend set forth in Section 4.1(b) hereof): (i) while a registration
statement covering the resale of such security is effective under the Securities Act, (ii) following any sale of such Shares pursuant
to Rule 144, (iii) if such Shares are eligible for sale under Rule 144, without the 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 or the Purchaser
promptly after such time as such legend is no longer required under this Section 4.1(c), and in any event within such time as to enable
the Transfer Agent to remove the legend hereunder by the Legend Removal Date, if required by the Transfer Agent to effect the removal
of the legend hereunder, or if requested by a Purchaser, respectively. The Company agrees that at such time as such legend is no longer
required under this Section 4.1(c), it will, no later than the earlier of (i) one (1) Trading Days and (ii) the number of Trading Days
comprising the Standard Settlement Period following the delivery by a Purchaser to the Company or the Transfer Agent of a certificate
representing Shares, as applicable, issued with a restrictive legend (such date, 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 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. As used herein, “Standard Settlement Period” means the standard settlement period, expressed in a
number of Trading Days, on the Company’s primary Trading Market with respect to the Common Stock as in effect on the date of delivery
of a certificate representing Shares, as applicable, issued with a restrictive legend.
(d) In addition
to such Purchaser’s other available remedies, the Company shall pay to a Purchaser, in cash, (i) as partial liquidated damages
and not as a penalty, for each $1,000 of 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 to the extent permitted by Section 4.1(c) above and (ii) if the Company fails to (a) issue
and deliver (or cause to be delivered) to a Purchaser by the Legend Removal Date a certificate representing the Securities so delivered
to the Company by such Purchaser that is free from all restrictive and other legends and (b) if after the Legend Removal Date such Purchaser
purchases (in an open market transaction or otherwise) shares of Common Stock to deliver in satisfaction of a sale by such Purchaser
of all or any portion of the number of shares of Common Stock, or a sale of a number of shares of Common Stock equal to all or any portion
of the number of shares of Common Stock that such Purchaser anticipated receiving from the Company without any restrictive legend, then,
an amount equal to the excess of such Purchaser’s total purchase price (including brokerage commissions and other out-of-pocket
expenses, if any) for the shares of Common Stock so purchased (including brokerage commissions and other out-of-pocket expenses, if any)
over the product of (A) such number of Shares that the Company was required to deliver to such Purchaser by the Legend Removal Date multiplied
by (B) the lowest closing sale price of the Common Stock on any Trading Day during the period commencing on the date of the delivery
by such Purchaser to the Company of the applicable Shares (as the case may be) and ending on the date of such delivery and payment under
this clause (ii).
(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 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 earlier
of the time that no Purchaser owns Securities, the Company covenants to maintain the registration of the Common Stock under Section 12(b)
or 12(g) of the Exchange Act and to use reasonable best efforts 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 (i) shall fail for any reason to satisfy the current public information requirement under Rule 144(c)
or (ii) has ever been an issuer described in Rule 144 (i)(1)(i) or becomes an issuer in the future, and the Company shall fail to satisfy
any condition set forth in Rule 144(i)(2) (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
Subscription Amount of such Purchaser’s Securities on the 10th day following a Public Information Failure which remains
uncured as of such date and on every thirtieth (30th) day thereafter (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 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 Securities Laws Disclosure;
Publicity. The Company shall (a) by the Disclosure Time, issue a press release disclosing the material terms of the transactions
contemplated hereby, and (b) file a Current Report on Form 8-K, including the Transaction Documents as exhibits thereto, with the Commission
within the time required by the Exchange Act. 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, Affiliates or agents, in connection with the transactions
contemplated by the Transaction Documents. In addition, effective upon the issuance of such press release, the Company acknowledges and
agrees that any and all confidentiality or similar obligations under any agreement, whether written or oral, between the Company, any
of its Subsidiaries or any of their respective officers, directors, agents, employees, Affiliates or agents shall terminate and be of
no further force or effect. The Company understands and confirms that each Purchaser shall be relying on the foregoing covenant in effecting
transactions in securities of the Company. 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 or rule or form promulgated
thereunder in connection with the filing of final Transaction Documents with the Commission and (b) to the extent such disclosure is
required by law or rule or form promulgated thereunder or Trading Market regulations, in which case the Company shall provide the Purchasers
with prior notice of such disclosure permitted under this clause (b) and reasonably cooperate with such Purchaser regarding such disclosure.
4.6 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.
4.7 Non-Public Information.
Except with respect to the material terms and conditions of the transactions contemplated by the Transaction Documents, which shall be
disclosed pursuant to Section 4.6, the Company covenants and agrees that neither it, nor any other Person acting on its behalf will provide
any Purchaser or its agents or counsel with any information that constitutes, or the Company reasonably believes constitutes, material
non-public information, unless prior thereto such Purchaser shall have consented in writing to the receipt of such information and agreed
in writing with the Company to keep such information confidential. The Company understands and confirms that each Purchaser shall be
relying on the foregoing covenant in effecting transactions in securities of the Company. To the extent that the Company, any of its
Subsidiaries, or any of their respective officers, director, agents, employees or Affiliates delivers any material, non-public information
to a Purchaser without such Purchaser’s consent, the Company hereby covenants and agrees that such Purchaser shall not have any
duty of confidentiality to the Company, any of its Subsidiaries, or any of their respective officers, directors, employees, Affiliates
or agents, or a duty to the Company, any of its Subsidiaries or any of their respective officers, directors, employees, Affiliates or
agents not to trade on the basis of, such material, non-public information, provided that the Purchaser shall remain subject to applicable
law. To the extent that any notice provided pursuant to any Transaction Document constitutes, or contains, material, non-public information
regarding the Company or any Subsidiaries, unless the Purchaser has consented in writing to the receipt of such material non-public information,
the Company shall simultaneously with the delivery of such notice file such notice with the Commission pursuant to a Current Report on
Form 8-K. The Company understands and confirms that each Purchaser shall be relying on the foregoing covenant in effecting transactions
in securities of the Company.
4.8
Use of Proceeds. The Company covenants and agrees that (a) it shall use $350,000 of the net proceeds from the sale of the
Securities at the Initial Closing solely to pay legal and accounting fees and costs of the Company; and (b) with respect to the other
$400,000 of the net proceeds from the sale of the Securities at the Initial Closing, which shall be wired to Myrtle (per instructions
be provided by the Company in advance of the Initial Closing), shall be immediately wired by Myrtle to Rennova or its affiliates to pay
outstanding rent and services fees owed by Myrtle to Rennova. At any Purchaser’s request, the Company shall supply evidence of
the application of any and all proceeds received pursuant to this Agreement and any Note.
4.9 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 the Purchaser Parties in any capacity (including a Purchaser
Party’s status as an investor), or any of them or their respective Affiliates, by the Company or any stockholder of the Company
who is not an Affiliate of such Purchaser Party, arising out of or relating to any of the transactions contemplated by the Transaction
Documents. For the avoidance of doubt, the indemnification provided herein is intended to, and shall also cover, direct claims brought
by the Company against the Purchaser Parties; provided, however, that such indemnification shall not cover any loss, claim, damage or
liability to the extent it is finally judicially determined to be attributable to any Purchaser Party’s breach of any of the representations,
warranties, covenants or agreements made by such Purchaser Party in any Transaction Document or any conduct by a Purchaser Party which
is finally judicially determined to constitute fraud, gross negligence or willful misconduct. 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, except with respect to direct claims brought by the Company, 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 to the applicable Purchaser Party (which may be internal 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 any of the representations, warranties, covenants
or agreements made by such Purchaser Party in this Agreement or in the other Transaction Documents or any conduct by a Purchaser Party
which is finally judicially determined to constitute fraud, gross negligence or willful misconduct. In addition, if any Purchaser Party
takes actions to collect amounts due under any Transaction Documents or to enforce the provisions of any Transaction Documents, then
the Company shall pay the costs incurred by such Purchaser Party for such collection, enforcement or action, including, but not limited
to, attorneys’ fees and disbursements. The indemnification and other payment obligations required by this Section 4.10 shall be
made by periodic payments of the amount thereof during the course of the investigation, defense, collection, enforcement or action, as
and when bills are received or are incurred; provided, that if any Purchaser Party is finally judicially determined not to be entitled
to indemnification or payment under this Section 4.10, such Purchaser Party shall promptly reimburse the Company for any payments that
are advanced under this sentence. 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.
4.10 Reservation and Listing
of Securities.
(a) The Company
shall maintain a reserve of the Required Minimum 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, 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 its 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 60th 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. The Company agrees to maintain the eligibility of the Common Stock for electronic transfer through the Depository
Trust Company or another established clearing corporation, including, without limitation, by timely payment of fees to the Depository
Trust Company or such other established clearing corporation in connection with such electronic transfer.
4.11 Equal Treatment of
Purchasers. No consideration (including any modification of this Agreement but excluding the reimbursement of legal fees) shall be
offered or paid to any Person to amend or consent to a waiver or modification of any provision of this Agreement unless the same consideration
is also offered to all of the parties to this Agreement. Further, the Company shall not make any payment of principal or interest on
the Notes in amounts which are disproportionate to the respective principal amounts outstanding on the Notes at any applicable time.
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.
4.12 Certain Transactions
and Confidentiality. Each Purchaser, severally and not jointly with the other Purchasers, covenants that neither it, nor any Affiliate
acting on its behalf or pursuant to any understanding with it will execute any purchases or sales, including Short Sales, of any of the
Company’s securities during the period commencing with the execution of this Agreement and ending at such time that the transactions
contemplated by this Agreement are first publicly announced pursuant to the initial press release as described in Section 4.6. 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 (other than as disclosed to its legal and other representatives).
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 or duty not to trade in the securities of the Company to the Company, any of its Subsidiaries,
or any of their respective officers, directors, employees, Affiliates or agent, 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.
4.13 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.
4.14 Guarantee. Rennova
Health, Inc. hereby, jointly and severally, unconditionally and irrevocably, guarantees to Holder the prompt and complete payment and
performance when due (whether at the stated maturity, by acceleration or otherwise) in indefeasible payment in full of the Initial Note.
For the avoidance of doubt, there will be no guarantee of any Subsequent Notes.
4.15 Registration Rights.
As soon as practicable following written notice from a Purchaser (and in any event within 30 calendar days following such notice), the
Company shall file a registration statement on Form S-1 (or other appropriate form if the Company is not then S-1 eligible) providing
for the resale by the Purchasers of the Shares issued hereunder. The Company shall use commercially reasonable efforts to cause such
registration statement to become effective within 60 days following the filing thereof and to keep such registration statement effective
at all times until no Purchaser owns any Shares.
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 the fifth (5th) Trading Day following the date hereof, provided, however, that no such
termination will affect the right of any party to sue for any breach by any other party (or parties).
5.2 Fees and Expenses.
The Company shall be responsible for the payment of any placement agent’s fees, financial advisory fees, or broker’s commissions
(other than for Persons engaged by any Purchaser) relating to or arising out of the transactions contemplated hereby. The Company shall
pay, and hold each Purchaser harmless against, any liability, loss or expense (including, without limitation, reasonable attorney’s
fees and out-of-pocket expenses) arising in connection with any claim relating to any such payment. 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 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 time of transmission, if such notice or communication is delivered via facsimile at the
facsimile number or email attachment at the email address as set forth on the signature pages attached hereto at or prior to 5:30 p.m.
(New York City time) on a Trading Day, (b) the next Trading Day after the time of transmission, if such notice or communication is delivered
via facsimile at the facsimile number or email attachment as set forth on the signature pages attached hereto on a day that is not a
Trading Day or later than 5:30 p.m. (New York City time) on any Trading Day, (c) the second (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 Required Holders (or, prior to the Closing, the Company and each Purchaser) or, in the case of a
waiver, by the party against whom enforcement of any such waived provision is sought, provided that if any amendment, modification or
waiver disproportionately and adversely impacts a Purchaser (or group of Purchasers), the consent of such disproportionately impacted
Purchaser (or group of Purchasers) shall also be required. No waiver of any default with respect to any provision, condition or requirement
of this Agreement shall be deemed to be a continuing waiver in the future or a waiver of any subsequent default or a waiver of any other
provision, condition or requirement hereof, nor shall any delay or omission of any party to exercise any right hereunder in any manner
impair the exercise of any such right. Any amendment effected in accordance with this Section 5.5 shall be binding upon each Purchaser
and holder of Securities and the Company.
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 and this
Section 5.8.
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 or Proceeding, any claim that it is not personally subject to the
jurisdiction of any such court, that such Action or Proceeding is improper or is an inconvenient venue for such Proceeding. Each party
hereby irrevocably waives personal service of process and consents to process being served in any such Action or Proceeding by mailing
a copy thereof via registered or certified mail or overnight delivery (with evidence of delivery) to such party at the address in effect
for notices to it under this Agreement and agrees that such service shall constitute good and sufficient service of process and notice
thereof. Nothing contained herein shall be deemed to limit in any way any right to serve process in any other manner permitted by law.
If any party shall commence an Action 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 or Proceeding shall be reimbursed by the non-prevailing
party for its reasonable attorneys’ fees and other costs and expenses incurred with the investigation, preparation and prosecution
of such Action 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.
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 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 effective 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. 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.
FOXO TECHNOLOGIES inc. |
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Address for Notice: |
By: |
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FOXO Technologies Inc. |
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Name: |
Mark White |
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729 Washington Ave. N. |
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Title: |
Interim CEO |
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Suite 600 |
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Minneapolis, MN 55401 |
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Email: mark@kr8.ai |
Solely with respect to the guarantee obligations
under Section 4.14:
RENNOVA HEALTH INC. |
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By: | |
|
| Name: | Seamus
Lagan |
|
| Title: | Chief Executive
Officer |
|
Address: 400 S. Australian Avenue,
West Palm Beach, Florida 33401
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK
SIGNATURE PAGE FOR PURCHASER FOLLOWS]
[PURCHASER
SIGNATURE PAGES TO FOXO 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:
Address for Notice to Purchaser:
Address for Delivery of Securities to Purchaser (if not same as address
for notice):
Attn:
Initial Subscription Amount: $750,000
Principal Amount of Initial Notes: $840,000
Shares: 1,108,755
First Subsequent Subscription Amounts (conditional): $250,000
Principal Amount of First Subsequent Notes: $280,000
Second Subsequent Subscription Amounts (conditional): $1,000,000
Principal Amount of Second Subsequent Notes: $1,120,000
Third Subsequent Subscription Amounts (conditional): $500,000
Principal Amount of Third Subsequent Notes: $560,000
EIN Number:
Schedules
Exhibit 99.2
FOXO Technologies Inc. Secures Up to $2.8 Million
in Senior Notes
to Fund Previously Announced Acquisition of Myrtle Recovery Centers, Inc.
and Provide Additional Working Capital
MINNEAPOLIS, MN, June 18, 2024 —FOXO
Technologies Inc. (NYSE American: FOXO) (the “Company” or “FOXO”), today announced that it has secured up
to $2.8 million in Senior Notes from an institutional investor (“Investor”) to fund the previously announced acquisition of
Myrtle Recovery Centers, Inc. as well as provide additional working capital to support the Company’s growth strategy.
Mark White, Interim CEO
of FOXO, said, “We appreciate the support of this institutional investor, which we believe is further validation of our business
model. Specifically, we intend to use the proceeds to complete the acquisition of Myrtle Recovery Centers, Inc., as well as advance our
planned acquisition of Scott County Community Hospital, Inc. (d/b/a Big South Fork Medical Center). As previously noted, we believe these
two acquisitions will be transformative for the Company, given that these businesses generated combined unaudited net revenue of approximately
$18.7 million and net income of approximately $5.2 million for the twelve months ended December 31, 2023. We are making progress towards
completing the planned acquisitions, which we expect will be highly synergistic with our existing epigenetic and AI-based epigenetic solutions.
Overall, we could not be more excited about the outlook for the business and look forward to providing further updates.”
Additional details on
the Senior Notes are available in the Company’s Form 8-K, which has been filed with the Securities and Exchange Commission.
About FOXO Technologies Inc.
FOXO is a biotechnology company dedicated to improving
human health and longevity through the development of cutting-edge technology and product solutions for various industries, including
life insurance. FOXO’s epigenetic technology applies AI to DNA methylation to identify molecular biomarkers of human health and
aging. FOXO is committed to leveraging the latest advancements in science and technology to help people live better, longer lives. For
more information about FOXO, visit www.foxotechnologies.com.
Forward-Looking Statements
This press release contains
certain forward-looking statements for purposes of the “safe harbor” provisions under the United States Private Securities
Litigation Reform Act of 1995. Any statements other than statements of historical fact contained herein, including statements about the
delisting of the Warrants from NYSE American, trading of the Warrants in the over-the-counter market, the continued listing of the Company’s
Class A common stock on NYSE American, and other statements identified by words such as “will likely result,” “are expected
to,” “will continue,” “is anticipated,” “estimated,” “believe,” “intend,”
“plan,” “projection,” “outlook” or words of similar meaning, but the absence of these words does not
mean that a statement is not forward-looking. Any such forward-looking statements are based upon the current beliefs and expectations
of the Company’s management and are inherently subject to significant business, economic and competitive uncertainties and contingencies,
many of which are difficult to predict and generally beyond the Company’s control. Many factors could cause actual future events
to differ materially from the forward-looking statements in this press release, including but not limited to the possibility that the
Plan will not be accepted by NYSE American, the Company will be unable to satisfy other continued listing requirements of NYSE American
for its Class A common stock to maintain the listing of the Class A common stock on NYSE American; the risk of changes in the competitive
and highly regulated industries in which FOXO operates; variations in operating performance across competitors or changes in laws and
regulations affecting FOXO’s business; the ability to implement FOXO’s business plans, forecasts, and other expectations;
the ability to obtain financing; the risk that FOXO has a history of losses and may not achieve or maintain profitability in the future;
potential inability of FOXO to establish or maintain relationships required to advance its goals or to achieve its commercialization and
development plans; the enforceability of FOXO’s intellectual property, including its patents and the potential infringement on the
intellectual property rights of others; and the risk of downturns and a changing regulatory landscape in the highly competitive biotechnology
industry or in the markets or industries in which FOXO operates, including the highly regulated insurance industry. The foregoing list
of factors is not exhaustive. Readers should carefully consider the foregoing factors and the other risks and uncertainties discussed
in FOXO’s most recent reports on Forms 10-K and 10-Q, particularly the “Risk Factors” sections of those reports, and
in other documents FOXO has filed, or will file, with the SEC. These filings identify and address other important risks and uncertainties
that could cause actual events and results to differ materially from those contained in the forward-looking statements. Forward-looking
statements speak only as of the date they are made. Readers are cautioned not to put undue reliance on forward-looking statements, and
FOXO assumes no obligation and do not intend to update or revise these forward-looking statements, whether as a result of new information,
future events, or otherwise.
Contact:
Crescendo Communications, LLC
(212) 671-1020
foxo@crescendo-ir.com
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