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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 of
earliest event reported): August 23, 2023
WeTrade Group Inc.
(Exact name of Company as specified in charter)
Wyoming |
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7374 |
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N/A |
(State or other jurisdiction of
incorporation or organization) |
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(Primary Standard Industrial
Classification Code Number) |
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(I.R.S. Employer
Identification Number) |
Room 101, Level 1 Building 8,
No. 18, Kechuang 10th Street,
Beijing Economic and
Technological Development Zone
People’s
Republic of China 100020
+86-135-011-76409
(Address, including zip code, and telephone number,
including area code, of principal executive offices)
Wyoming Registered Agent
1621 Central Ave Cheyenne,
Wyoming 82001
(Name, address, including zip code, and telephone
number, including area code, of agent for service)
Check the appropriate box below if the Form 8-K
filing is intended to simultaneously satisfy the filing obligation of the Company under any of the following provisions (see General Instruction
A.2. below):
☐ |
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
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Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
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Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
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☐ |
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
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 August 23, 2023, Wetrade
Group Inc. (the “Company”) entered into a Securities Purchase Agreement (the “Securities Purchase Agreement) with certain
investors (the “Purchasers”), pursuant to which the Company will receive a net proceed of up to $35,000,000 in consideration
of the issuance of:
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senior convertible notes in the aggregate original principal amount of $35,000,000 (the “Convertible Notes”); |
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warrants to purchase up to 100% of the number of the Company’s shares of common stock (the “Common Stock”) underlying the aggregate face value of the Convertible Notes at the initial conversion price until on or prior to 11:59 p.m. (New York time) on the five-year anniversary of the closing date at an exercise price of $4.76 (the “PIPE Warrants”). |
The transactions contemplated
under the Securities Purchase Agreement will close on or about September 29, 2023, subject to shareholder approval. The Company intends
to use the proceeds from the issuance of the Convertible Notes and the PIPE Warrants for general corporate purposes.
The Convertible Notes
bear interest at an interest rate of 10% per annum payable on each installment date commencing on the original date of issuance. If an
Event of Default (as defined in the Notes) has occurred and is continuing, interest would accrue at the rate of 18% per annum, compounding
monthly. The Convertible Notes are convertible into shares of Common Stock, beginning after the original date of issuance at an initial
conversion price of $4.76 per share. The conversion price is subject to customary adjustments for stock dividends, stock splits, reclassifications
and the like, and subject to price-based adjustment, on a “full ratchet” basis, in the event of any issuances of Common Stock,
or securities convertible, exercisable or exchangeable for, Common Stock at a price below the then-applicable conversion price (subject
to certain exceptions).
The PIPE Warrants contain
provisions permitting cashless exercise subject to certain conditions.
The Convertible Notes
and the PIPE Warrants contain conversion limitations providing that a holder thereof may not convert the Convertible Notes or exercise
the PIPE Warrants to the extent (but only to the extent) that, if after giving effect to such conversion or exercise, the holder or any
of its affiliates would beneficially own in excess of 4.99% the ordinary shares immediately after giving effect to such conversion or
exercise. A holder may increase or decrease its beneficial ownership limitation upon notice to the Company provided that in no event such
limitation exceeds 9.99%, and that any increase shall not be effective until the 61st day after such notice.
The Convertible Notes
will rank senior to all outstanding and future indebtedness of the Company.
The foregoing description
does not purport to be complete and is qualified in its entirety by reference to the full text of the Convertible Notes, the Securities
Purchase Agreement, and the PIPE Warrant attached hereto as Exhibits 4.1, 10.1, and 10.2, respectively, each of which are incorporated
herein by reference.
Item 2.03. Creation
of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant.
The disclosure set forth
under Item 1.01 is incorporated herein by reference.
Item 3.02. Unregistered
Sales of Equity Securities.
The information included
in Item 1.01 of this Current Report is incorporated by reference into this Item 3.02 of this Current Report to the extent required. The
Convertible Notes, the PIPE Warrants, the Placement Warrants and the conversion shares have been offered and sold pursuant to exemptions
from the registration requirements of the Securities Act afforded by Section 4(a)(2) thereof and Rule 506 of Regulation D promulgated
thereunder, for the sale of securities not involving a public offering. Each of the Purchasers is an accredited investor which has purchased
the securities as an investment in a private placement that did not involve a general solicitation. The shares of Common Stock to be issued
upon conversion of the Convertible Notes and the exercise of the PIPE Warrants have not been registered under the Securities Act and may
not be offered or sold in the United States in the absence of an effective registration statement or exemption from the registration requirements.
This Current Report on Form 8-K shall not constitute an offer to sell or the solicitation of an offer to buy, nor shall there be any sale
of these securities in any state in which such offer, solicitation or sale would be unlawful prior to the registration or qualification
under the securities laws of any such state.
Item 9.01. Exhibits
(d) Exhibits.
SIGNATURES
Pursuant to
the requirements of the Securities Exchange Act of 1934, the Company has duly caused this report to be signed on its behalf by the undersigned
hereunto duly authorized.
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Wetrade Group Inc. |
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By: |
/s/ Hechun Wei |
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Name: |
Hechun Wei |
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Title: |
Chief Executive Officer |
Dated: August 24, 2023
2
Exhibit 4.1
NEITHER THIS SECURITY NOR THE SECURITIES
INTO WHICH THIS SECURITY IS CONVERTIBLE HAVE BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION OR THE SECURITIES COMMISSION
OF ANY STATE IN RELIANCE UPON AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”),
AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR PURSUANT
TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND IN ACCORDANCE
WITH APPLICABLE STATE SECURITIES LAWS. THIS SECURITY AND THE SECURITIES ISSUABLE UPON CONVERSION OF THIS SECURITY MAY BE PLEDGED IN CONNECTION
WITH A BONA FIDE MARGIN ACCOUNT OR OTHER LOAN SECURED BY SUCH SECURITIES.
Original Issue Date: August 23, 2023
Original Conversion Price (subject to
adjustment herein): $4.76
SENIOR CONVERTIBLE DEBENTURE
DUE AUGUST 23, 2024
THIS SENIOR CONVERTIBLE
DEBENTURE is one of a series of duly authorized and validly issued Senior Convertible Debentures of WeTrade Group Inc., a Wyoming corporation
(the “Company”), having its principal place of business at 1621 Central Ave, Cheyenne, WY 82001, designated as its
Senior Convertible Debenture due August 23, 2024 (this debenture, the “Debenture” and, collectively with the other
debentures of such series, the “Debentures”).
FOR VALUE RECEIVED,
the Company promises to pay to or its registered assigns (the “Holder”), or shall have paid pursuant to the terms hereunder,
the principal sum of $ on August 23, 2024 (the “Maturity Date”) or such earlier date as this Debenture is required
or permitted to be repaid as provided hereunder, and to pay interest to the Holder on the aggregate unconverted and then outstanding principal
amount of this Debenture in accordance with the provisions hereof. This Debenture is subject to the following additional provisions:
Section 1.
Definitions. For the purposes hereof, in addition to the terms defined elsewhere in this Debenture, (a) capitalized terms not otherwise
defined herein shall have the meanings set forth in the Purchase Agreement and (b) the following terms shall have the following meanings:
“Alternate Consideration” shall have the
meaning set forth in Section 5(e).
“Bankruptcy
Event” means any of the following events: (a) the Company or any Significant Subsidiary (as such term is defined in Rule 1-02(w)
of Regulation S-X) thereof commences a case or other proceeding under any bankruptcy, reorganization, arrangement, adjustment of debt,
relief of debtors, dissolution, insolvency or liquidation or similar law of any jurisdiction relating to the Company or any Significant
Subsidiary thereof, (b) there is commenced against the Company or any Significant Subsidiary thereof any such case or proceeding that
is not dismissed within 60 days after commencement, (c) the Company or any Significant Subsidiary thereof is adjudicated insolvent or
bankrupt or any order of relief or other order approving any such case or proceeding is entered, (d) the Company or any Significant Subsidiary
thereof suffers any appointment of any custodian or the like for it or any substantial part of its property that is not discharged or
stayed within 60 calendar days after such appointment, (e) the Company or any Significant Subsidiary thereof makes a general assignment
for the benefit of creditors, (f) the Company or any Significant Subsidiary thereof calls a meeting of its creditors with a view to arranging
a composition, adjustment or restructuring of its debts, (g) the Company or any Significant Subsidiary thereof admits in writing that
it is generally unable to pay its debts as they become due, (h) the Company or any Significant Subsidiary thereof, by any act or failure
to act, expressly indicates its consent to, approval of or acquiescence in any of the foregoing or takes any corporate or other action
for the purpose of effecting any of the foregoing.
“Base Conversion Price”
shall have the meaning set forth in Section 5(b).
“Beneficial Ownership Limitation” shall
have the meaning set forth in Section 4(d).
“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
are open for use by customers on such day.
“Buy-In” shall have the meaning set forth
in Section 4(c)(v).
“Change
of Control Transaction” means the occurrence after the date hereof of any of (a) an acquisition after the date hereof by
an individual or legal entity or “group” (as described in Rule 13d-5(b)(1) promulgated under the Exchange Act) of
effective control (whether through legal or beneficial ownership of capital stock of the Company, by contract or otherwise) of in
excess of 33% of the voting securities of the Company (other than by means of conversion or exercise of the Debentures and the
Securities issued together with the Debentures), (b) the Company merges into or consolidates with any other Person, or any Person
merges into or consolidates with the Company and, after giving effect to such transaction, the stockholders of the Company
immediately prior to such transaction own less than 66% of the aggregate voting power of the Company or the successor entity of such
transaction, (c) the Company (and all of its Subsidiaries, taken as a whole) sells or transfers all or substantially all of its
assets to another Person and the stockholders of the Company immediately prior to such transaction own less than 66% of the
aggregate voting power of the acquiring entity immediately after the transaction, (d) a replacement at one time or within a three
year period of more than one-half of the members of the Board of Directors which is not approved by a majority of those individuals
who are members of the Board of Directors on the Original Issue Date (or by those individuals who are serving as members of the
Board of Directors on any date whose nomination to the Board of Directors was approved by a majority of the members of the Board of
Directors who are members on the date hereof), or (e) the execution by the Company of an agreement to which the Company is a party
or by which it is bound, providing for any of the events set forth in clauses (a) through (d) above.
“Conversion”
shall have the meaning ascribed to such term in Section 4.
“Conversion Date”
shall have the meaning set forth in Section 4(a).
“Conversion Price”
shall have the meaning set forth in Section 4(b).
“Conversion Schedule”
means the Conversion Schedule in the form of Schedule 1 attached hereto.
“Conversion Shares”
means, collectively, the shares of Common Stock issuable upon conversion of this Debenture in accordance with the terms hereof.
“Debenture Register”
shall have the meaning set forth in Section 2(c).
“Dilutive Issuance”
shall have the meaning set forth in Section 5(b).
“Dilutive Issuance Notice” shall have the
meaning set forth in Section 5(b).
“Equity
Conditions” means, during the period in question, (a) the Company shall have duly honored all conversions and redemptions
scheduled to occur or occurring by virtue of one or more Notices of Conversion of the Holder, if any, (b) the Company shall have
paid all liquidated damages and other amounts owing to the Holder in respect of this Debenture, (c) all of the Conversion Shares
issuable pursuant to the Transaction Documents (and shares issuable in lieu of cash payments of interest) may be resold pursuant to
Rule 144 without volume or manner-of-sale restrictions or current public information requirements as determined by the counsel to
the Company as set forth in a written opinion letter to such effect, addressed and acceptable to the Transfer Agent and the Holder,
(d) the Common Stock is trading on a Trading Market and all of the shares issuable pursuant to the Transaction Documents are listed
or quoted for trading on such Trading Market (and the Company believes, in good faith, that trading of the Common Stock on a Trading
Market will continue uninterrupted for the foreseeable future), (e) there is a sufficient number of authorized but unissued and
otherwise unreserved shares of Common Stock for the issuance of all of the shares then issuable pursuant to the Transaction
Documents, (f) there is no existing Event of Default and no existing event which, with the passage of time or the giving of notice,
would constitute an Event of Default, (g) the issuance of the shares in question (or, in the case of a Monthly Redemption, the
shares issuable upon conversion in full of the Monthly Redemption Amount) to the Holder would not violate the limitations set forth
in Section 4(d) and Section 4(e) herein, (h) there has been no public announcement of a pending or proposed Fundamental Transaction
or Change of Control Transaction that has not been consummated, (i) the applicable Holder is not in possession of any information
provided by the Company, any of its Subsidiaries, or any of their officers, directors, employees, agents or Affiliates, that
constitutes, or may constitute, material non-public information and, (j) for any fifteen (15) Trading Days in a period of 20
consecutive Trading Days prior to the applicable date in question, the average daily trading volume for the Common Stock on the
principal Trading Market exceeds $225,000 per Trading Day.
“Equity
Conditions Failure” means that on any day during the period commencing twenty (20) Trading Days prior to the applicable
Monthly Redemption Date through the date on which the applicable shares of Common Stock are actually delivered to the Holder, any of
the Equity Conditions from (a) to (i) above has not been satisfied, or for the average daily trading volume in 15 Trading Days
during the 20 Trading Days prior Monthly Redemption Date (or waived in writing by the Holder) as described in the Equity Condition
(j) above has not been satisfied.
“Event of Default”
shall have the meaning set forth in Section 8(a).
“Financing Redemption Amount”
means up to 30% (at par) of the issuance amount of any subsequent financing of over $2,500,000.
“Fundamental Transaction” shall have the
meaning set forth in Section 5(e).
“Interest
Conversion Rate” means the lesser of (a) the Conversion Price then in effect, (b) 80% of the daily VWAP on the Trading Day immediately
prior to the Monthly Redemption Date, and (c) 80% of the lowest daily VWAP in the ten (10) Trading Days immediately prior to the Monthly
Redemption Date.
“Interest Conversion Shares” shall have
the meaning set forth in Section 2(a).
“Interest Notice Period”
shall have the meaning set forth in Section 2(a).
“Interest Payment Date”
shall have the meaning set forth in Section 2(a).
“Interest Share Amount”
shall have the meaning set forth in Section 2(a).
“Issuable Maximum”
shall have the meaning set forth in Section 4(e).
“Late Fees” shall have the meaning set
forth in Section 2(d).
“Purchaser”
shall have the meaning ascribed to such term in the Purchase Agreement.
“Mandatory
Default Amount” means the sum of (a) the greater of (i) the outstanding principal amount of this Debenture, plus all accrued
and unpaid interest hereon, divided by the Conversion Price on the date the Mandatory Default Amount is either (A) demanded (if demand
or notice is required to create an Event of Default) or otherwise due or (B) paid in full, whichever has a lower Conversion Price, multiplied
by the VWAP on the date the Mandatory Default Amount is either (x) demanded or otherwise due or (y) paid in full, whichever has a higher
VWAP, or (ii) 130% of the outstanding principal amount of this Debenture, plus 100% of accrued and unpaid interest hereon, and (b) all
other amounts, costs, expenses and liquidated damages due in respect of this Debenture.
“Monthly
Conversion Period” shall have the meaning set forth in Section 6(a) hereof.
“Monthly Conversion Price” shall have the
meaning set forth in Section 6(a) hereof.
“Monthly
Redemption” means the redemption of this Debenture pursuant to Section 6(a) hereof.
“Monthly
Redemption Amount” means, as to a Monthly Redemption, an amount to be fixed on the first Monthly Redemption Date, and calculated
as the total issued principal amount divided by the number of months remaining at the time of the first Monthly Redemption Date, plus
accrued but unpaid interest, liquidated damages and any other amounts then owing to the Holder in respect of this Debenture. For purposes
of clarity, the Monthly Redemption Amount shall be the same for every Monthly Redemption Date thereafter regardless of any accelerations
or deferrals.
“Monthly
Redemption Date” means the day of the month commencing immediately upon the earlier of (a) the first such date immediately
following the Effective Date and (b) , 2023, and terminating upon the full redemption of this Debenture. For example, if the
Effective Date is, 2023, then the first Monthly Redemption Date will be, 2023 and thereafter the 15th day of each month
until this Debenture is redeemed in full.
“Monthly
Redemption Notice” shall have the meaning set forth in Section 6(a) hereof.
“New York Courts”
shall have the meaning set forth in Section 9(d).
“Notice of Conversion”
shall have the meaning set forth in Section 4(a).
“Original
Issue Date” means the date of the first issuance of the Debentures, regardless of any transfers of any Debenture and regardless
of the number of instruments which may be issued to evidence such Debentures.
“Pre-Redemption
Conversion Shares” shall have the meaning set forth in Section 6(a) hereof.
“Purchase
Agreement” means the Securities Purchase Agreement, dated as of _, 2023 among the Company and the original Holders, as amended,
modified or supplemented from time to time in accordance with its terms.
“Securities
Act” means the Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder.
“Share Delivery Date” shall have the meaning
set forth in Section 4(c)(ii).
“Successor Entity”
shall have the meaning set forth in Section 5(e).
“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 or the New York Stock
Exchange (or any successors to any of the foregoing).
“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 Purchasers of a majority in interest of the Securities then outstanding
and reasonably acceptable to the Company, the fees and expenses of which shall be paid by the Company.
Section 2. Interest.
a) Payment
of Interest in Cash or Kind. The Company shall pay interest to the Holder on the aggregate unconverted and then outstanding principal
amount of this Debenture at the rate of 10% per annum, payable on each Monthly Redemption Date (as to that principal amount then being
redeemed), on each Conversion Date (as to that principal amount then being converted), and on the Maturity Date (each such date, an “Interest
Payment Date”) (if any Interest Payment Date is not a Business Day, then the applicable payment shall be due on the next succeeding
Business Day), in cash or, at the Company’s option, in duly authorized, validly issued, fully paid and non-assessable shares of
Common Stock at the Interest Conversion Rate (the dollar amount to be paid in shares, the “Interest Share Amount”)
or a combination thereof; provided, however, that payment in shares of Common Stock may only occur if (i) all of the Equity
Conditions have been met (unless waived by the Holder in writing) during the 20 Trading Days immediately prior to the applicable Interest
Payment Date (the “Interest Notice Period”) and through and including the date such shares of Common Stock are actually
issued to the Holder, (ii) the Company shall have given the Holder notice in accordance with the notice requirements set forth below and
(iii) as to such Interest Payment Date, prior to such Interest Notice Period (but not more than five (5) Trading Days prior to the commencement
of such Interest Notice Period), the Company shall have delivered to the Holder’s account with The Depository Trust Company a number
of shares of Common Stock to be applied against such Interest Share Amount equal to the quotient of (x) the applicable Interest Share
Amount divided by (y) the lesser of the (i) then Conversion Price and (ii) the Interest Conversion Rate assuming for such purposes that
the Interest Payment Date is the Trading Day immediately prior to the commencement of the Interest Notice Period (the “Interest
Conversion Shares”).
b) Company’s
Election to Pay Interest in Cash or Kind. Subject to the terms and conditions herein, the decision whether to pay interest
hereunder in cash, shares of Common Stock or a combination thereof shall be at the sole discretion of the Company. Prior to the
commencement of any Interest Notice Period, the Company shall deliver to the Holder a written notice of its election to pay interest
hereunder on the applicable Interest Payment Date either in cash, shares of Common Stock or a combination thereof and the Interest
Share Amount as to the applicable Interest Payment Date, provided that the Company may indicate in such notice that the election
contained in such notice shall apply to future Interest Payment Dates until revised by a subsequent notice. During any Interest
Notice Period, the Company’s election (whether specific to an Interest Payment Date or continuous) shall be irrevocable as to
such Interest Payment Date. Subject to the aforementioned conditions, failure to timely deliver such written notice to the Holder
shall be deemed an election by the Company to pay the interest on such Interest Payment Date in cash. At any time the Company
delivers a notice to the Holder of its election to pay the interest in shares of Common Stock, the Company shall timely file a
prospectus supplement pursuant to Rule 424 disclosing such election. The aggregate number of shares of Common Stock otherwise
issuable to the Holder on an Interest Payment Date shall be reduced by the number of Interest Conversion Shares previously issued to
the Holder in connection with such Interest Payment Date.
c) Interest
Calculations. Interest shall be calculated on the basis of a 360-day year, consisting of twelve 30 calendar day periods, and shall
accrue daily commencing on the Original Issue Date until payment in full of the outstanding principal, together with all accrued and unpaid
interest, liquidated damages and other amounts which may become due hereunder, has been made. Payment of interest in shares of Common
Stock (other than the Interest Conversion Shares issued prior to an Interest Notice Period) shall otherwise occur pursuant to Section
4(c)(ii) herein and, solely for purposes of the payment of interest in shares, the Interest Payment Date shall be deemed the Conversion
Date. Interest shall cease to accrue with respect to any principal amount converted, provided that, the Company actually delivers the
Conversion Shares within the time period required by Section 4(c)(ii) herein. Interest hereunder will be paid to the Person in whose name
this Debenture is registered on the records of the Company regarding registration and transfers of this Debenture (the “Debenture
Register”). Except as otherwise provided herein, if at any time the Company pays interest partially in cash and partially in
shares of Common Stock to the holders of the Debentures, then such payment of cash shall be distributed ratably among the holders of the
then-outstanding Debentures based on their (or their predecessor’s) initial purchases of Debentures pursuant to the Purchase Agreement.
d) Late
Fee. All overdue accrued and unpaid interest to be paid hereunder shall entail a late fee at an interest rate equal to the lesser
of 10% per annum or the maximum rate permitted by applicable law (the “Late Fees”) which shall accrue daily from the
date such interest is due hereunder through and including the date of actual payment in full. Notwithstanding anything to the contrary
contained herein, if, on any Interest Payment Date the Company has elected to pay accrued interest in the form of Common Stock but the
Company is not permitted to pay accrued interest in Common Stock because it fails to satisfy the conditions for payment in Common Stock
set forth in Section 2(a) herein, then, at the option of the Holder, the Company, in lieu of delivering either shares of Common Stock
pursuant to this Section 2 or paying the regularly scheduled interest payment in cash, shall deliver, within three (3) Trading Days of
each applicable Interest Payment Date, an amount in cash equal to the product of (x) the number of shares of Common Stock otherwise deliverable
to the Holder in connection with the payment of interest due on such Interest Payment Date multiplied by (y) the highest VWAP during the
period commencing on the Interest Payment Date and ending on the Trading Day prior to the date such payment is actually made. If any Interest
Conversion Shares are issued to the Holder in connection with an Interest Payment Date and are not applied against an Interest Share Amount,
then the Holder shall promptly return such excess shares to the Company.
e) Prepayment.
Except as otherwise set forth in this Debenture, the Company may not prepay any portion of the principal amount of this Debenture without
the prior written consent of the Holder.
Section 3. Registration
of Transfers and Exchanges.
a) Different
Denominations. This Debenture is exchangeable for an equal aggregate principal amount of Debentures of different authorized denominations,
as requested by the Holder surrendering the same. No service charge will be payable for such registration of transfer or exchange.
b) Investment
Representations. This Debenture has been issued subject to certain investment representations of the original Holder set forth in
the Purchase Agreement and may be transferred or exchanged only in compliance with the Purchase Agreement and applicable federal and state
securities laws and regulations.
c) Reliance
on Debenture Register. Prior to due presentment for transfer to the Company of this Debenture, the Company and any agent of the Company
may treat the Person in whose name this Debenture is duly registered on the Debenture Register as the owner hereof for the purpose of
receiving payment as herein provided and for all other purposes, whether or not this Debenture is overdue, and neither the Company nor
any such agent shall be affected by notice to the contrary.
Section 4. Conversion.
a) Voluntary
Conversion. At any time after the Original Issue Date until this Debenture is no longer outstanding, this Debenture shall be
convertible, in whole or in part, into shares of Common Stock at the option of the Holder, at any time and from time to time
(subject to the conversion limitations set forth in Section 4(d) and Section 4(e) hereof). The Holder shall effect conversions by
delivering to the Company a Notice of Conversion, the form of which is attached hereto as Annex A (each, a “Notice
of Conversion”), specifying therein the principal amount of this Debenture to be converted and the date on which such
conversion shall be effected (such date, the “Conversion Date”). If no Conversion Date is specified in a Notice
of Conversion, the Conversion Date shall be the date that such Notice of Conversion is deemed delivered hereunder. No ink-original
Notice of Conversion shall be required, nor shall any medallion guarantee (or other type of guarantee or notarization) of any Notice
of Conversion form be required. To effect conversions hereunder, the Holder shall not be required to physically surrender this
Debenture to the Company unless the entire principal amount of this Debenture, plus all accrued and unpaid interest thereon, has
been so converted in which case the Holder shall surrender this Debenture as promptly as is reasonably practicable after such
conversion without delaying the Company’s obligation to deliver the shares on the Share Delivery Date. Conversions hereunder
shall have the effect of lowering the outstanding principal amount of this Debenture in an amount equal to the applicable
conversion. The Holder and the Company shall maintain records showing the principal amount(s) converted and the date of such
conversion(s). The Company may deliver an objection to any Notice of Conversion within one (1) Business Day of delivery of such
Notice of Conversion. In the event of any dispute or discrepancy, the records of the Holder shall be controlling and determinative
in the absence of manifest error. The Holder, and any assignee by acceptance of this Debenture, acknowledge and agree that, by
reason of the provisions of this paragraph, following conversion of a portion of this Debenture, the unpaid and unconverted
principal amount of this Debenture may be less than the amount stated on the face hereof.
b) Conversion
Price. The conversion price in effect on any Conversion Date shall be equal to $6.56, subject to adjustment herein (the “Conversion
Price”).
c)
Mechanics of Conversion.
i. Conversion
Shares Issuable Upon Conversion of Principal Amount. The number of Conversion Shares issuable upon a conversion hereunder shall be
determined by the quotient obtained by dividing (x) the outstanding principal amount of this Debenture to be converted by (y) the Conversion
Price.
ii. Delivery
of Conversion Shares Upon Conversion. Not later than the earlier of (i) two (2) Trading Days and (ii) the number of Trading Days comprising
the Standard Settlement Period (as defined below) after each Conversion Date (the “Share Delivery Date”), the Company
shall deliver, or cause to be delivered, to the Holder (A) the Conversion Shares which, on or after the earlier of (i) the six month anniversary
of the Original Issue Date or (ii) the Effective Date, shall be free of restrictive legends and trading restrictions (other than those
which may then be required by the Purchase Agreement) representing the number of Conversion Shares being acquired upon the conversion
of this Debenture (including, if the Company has given continuous notice pursuant to Section 2(b) for payment of interest in shares of
Common Stock at least 20 Trading Days prior to the date on which the Notice of Conversion is delivered to the Company, shares of Common
Stock representing the payment of accrued interest otherwise determined pursuant to Section 2(a) but assuming that the Interest Notice
Period is the 20 Trading Days period immediately prior to the date on which the Notice of Conversion is delivered to the Company and excluding
for such issuance the condition that the Company deliver Interest Conversion Shares as to such interest payment prior to the commencement
of the Interest Notice Period) and (B) a bank check in the amount of accrued and unpaid interest (if the Company has elected or is required
to pay accrued interest in cash). On or after the earlier of (i) the six-month anniversary of the Original Issue Date or (ii) the Effective
Date, the Company shall deliver any Conversion Shares required to be delivered by the Company under this Section 4(c) electronically through
the Depository Trust Company or another established clearing corporation performing similar functions. 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 the Notice of Conversion.
iii. Failure
to Deliver Conversion Shares. If, in the case of any Notice of Conversion, such Conversion Shares are not delivered to or as directed
by the applicable Holder by the Share Delivery Date, the Holder shall be entitled to elect by written notice to the Company at any time
on or before its receipt of such Conversion Shares, to rescind such Conversion, in which event the Company shall promptly return to the
Holder any original Debenture delivered to the Company and the Holder shall promptly return to the Company the Conversion Shares issued
to such Holder pursuant to the rescinded Conversion Notice.
iv. Obligation
Absolute; Partial Liquidated Damages. The Company’s obligations to issue and deliver the Conversion Shares upon conversion
of this Debenture in accordance with the terms hereof are absolute and unconditional, irrespective of any action or inaction by the
Holder to enforce the same, any waiver or consent with respect to any provision hereof, the recovery of any judgment against any
Person or any action to enforce the same, or any setoff, counterclaim, recoupment, limitation or termination, or any breach or
alleged breach by the Holder or any other Person of any obligation to the Company or any violation or alleged violation of law by
the Holder or any other Person, and irrespective of any other circumstance which might otherwise limit such obligation of the
Company to the Holder in connection with the issuance of such Conversion Shares; provided, however, that such delivery
shall not operate as a waiver by the Company of any such action the Company may have against the Holder. In the event the Holder of
this Debenture shall elect to convert any or all of the outstanding principal amount hereof, the Company may not refuse conversion
based on any claim that the Holder or anyone associated or affiliated with the Holder has been engaged in any violation of law,
agreement or for any other reason, unless an injunction from a court, on notice to Holder, restraining and or enjoining conversion
of all or part of this Debenture shall have been sought and obtained, and the Company posts a surety bond for the benefit of the
Holder in the amount of 150% of the outstanding principal amount of this Debenture, which is subject to the injunction, which bond
shall remain in effect until the completion of arbitration/litigation of the underlying dispute and the proceeds of which shall be
payable to the Holder to the extent it obtains judgment. In the absence of such injunction, the Company shall issue Conversion
Shares or, if applicable, cash, upon a properly noticed conversion. If the Company fails for any reason to deliver to the Holder
such Conversion Shares pursuant to Section 4(c)(ii) by the Share Delivery Date, the Company shall pay to the Holder, in cash, as
liquidated damages and not as a penalty, for each $1,000 of principal amount being converted, $10 per Trading Day (increasing to $20
per Trading Day on the fifth (5th) Trading Day after such liquidated damages begin to accrue) for each Trading Day after
such Share Delivery Date until such Conversion Shares are delivered or Holder rescinds such conversion. Nothing herein shall limit a
Holder’s right to pursue actual damages or declare an Event of Default pursuant to Section 8 hereof for the Company’s
failure to deliver Conversion Shares within the period specified herein and the Holder shall have the right to pursue all remedies
available to it hereunder, at law or in equity including, without limitation, a decree of specific performance and/or injunctive
relief. The exercise of any such rights shall not prohibit the Holder from seeking to enforce damages pursuant to any other Section
hereof or under applicable law.
v. Compensation
for Buy-In on Failure to Timely Deliver Conversion Shares Upon Conversion. In addition to any other rights available to the
Holder, if the Company fails for any reason to deliver to the Holder such Conversion Shares by the Share Delivery Date pursuant to
Section 4(c)(ii), and if after such Share Delivery Date the Holder is required by its brokerage firm to purchase (in an open market
transaction or otherwise), or the Holder’s brokerage firm otherwise purchases, shares of Common Stock to deliver in
satisfaction of a sale by the Holder of the Conversion Shares which the Holder was entitled to receive upon the conversion relating
to such Share Delivery Date (a “Buy-In”), then the Company shall (A) pay in cash to the Holder (in addition to
any other remedies available to or elected by the Holder) the amount, if any, by which (x) the Holder’s total purchase price
(including any brokerage commissions) for the Common Stock so purchased exceeds (y) the product of (1) the aggregate number of
shares of Common Stock that the Holder was entitled to receive from the conversion at issue multiplied by (2) the actual sale price
at which the sell order giving rise to such purchase obligation was executed (including any brokerage commissions) and (B) at the
option of the Holder, either reissue (if surrendered) this Debenture in a principal amount equal to the principal amount of the
attempted conversion (in which case such conversion shall be deemed rescinded) or deliver to the Holder the number of shares of
Common Stock that would have been issued if the Company had timely complied with its delivery requirements under Section 4(c)(ii).
For example, if the Holder purchases Common Stock having a total purchase price of $11,000 to cover a Buy-In with respect to an
attempted conversion of this Debenture with respect to which the actual sale price of the Conversion Shares (including any brokerage
commissions) giving rise to such purchase obligation was a total of $10,000 under clause (A) of the immediately preceding sentence,
the Company shall be required to pay the Holder $1,000. The Holder shall provide the Company written notice indicating the amounts
payable to the Holder in respect of the Buy-In and, upon request of the Company, evidence of the amount of such loss. Nothing herein
shall limit a Holder’s right to pursue any other remedies available to it hereunder, at law or in equity including, without
limitation, a decree of specific performance and/or injunctive relief with respect to the Company’s failure to timely deliver
Conversion Shares upon conversion of this Debenture as required pursuant to the terms hereof.
vi. Reservation
of Shares Issuable Upon Conversion. The Company covenants that it will at all times reserve and keep available out of its
authorized and unissued shares of Common Stock for the sole purpose of issuance upon conversion of this Debenture and payment of
interest on this Debenture, each as herein provided, free from preemptive rights or any other actual contingent purchase rights of
Persons other than the Holder (and the other holders of the Debentures), not less than such aggregate number of shares of the Common
Stock as shall (subject to the terms and conditions set forth in the Purchase Agreement) be issuable (taking into account the
adjustments and restrictions of Section 5) upon the conversion of the then outstanding principal amount of this Debenture and
payment of interest hereunder. The Company covenants that all shares of Common Stock that shall be so issuable shall, upon issue, be
duly authorized, validly issued, fully paid and nonassessable.
vii. Fractional
Shares. No fractional shares or scrip representing fractional shares shall be issued upon the conversion of this Debenture. As to
any fraction of a share which the Holder would otherwise be entitled to purchase upon such conversion, the Company shall at its election,
either pay a cash adjustment in respect of such final fraction in an amount equal to such fraction multiplied by the Conversion Price
or round up to the next whole share.
viii. Transfer
Taxes and Expenses. The issuance of Conversion Shares on conversion of this Debenture shall be made without charge to the Holder hereof
for any documentary stamp or similar taxes that may be payable in respect of the issue or delivery of such Conversion Shares, provided
that the Company shall not be required to pay any tax that may be payable in respect of any transfer involved in the issuance and delivery
of any such Conversion Shares upon conversion in a name other than that of the Holder of this Debenture so converted and the Company shall
not be required to issue or deliver such Conversion Shares unless or until the Person or Persons requesting the issuance thereof shall
have paid to the Company the amount of such tax or shall have established to the satisfaction of the Company that such tax has been paid.
The Company shall pay all Transfer Agent fees required for same-day processing of any Notice of Conversion and all fees to the Depository
Trust Company (or another established clearing corporation performing similar functions) required for same-day electronic delivery of
the Conversion Shares.
d) Holder’s
Conversion Limitations. The Company shall not effect any conversion of this Debenture, and a Holder shall not have the right to
convert any portion of this Debenture, to the extent that after giving effect to the conversion set forth on the applicable Notice
of Conversion, the Holder (together with the Holder’s Affiliates, and any other Persons acting as a group together with the
Holder or any of the Holder’s Affiliates (such Persons, “Attribution Parties”)) would beneficially own in
excess of the Beneficial Ownership Limitation (as defined below). For purposes of the foregoing sentence, the number of shares of
Common Stock beneficially owned by the Holder and its Affiliates and Attribution Parties shall include the number of shares of
Common Stock issuable upon conversion of this Debenture with respect to which such determination is being made, but shall exclude
the number of shares of Common Stock which would be issuable upon (i) conversion of the remaining, unconverted principal amount of
this Debenture beneficially owned by the Holder or any of its Affiliates or Attribution Parties and (ii) exercise or conversion of
the unexercised or unconverted portion of any other securities of the Company subject to a limitation on conversion or exercise
analogous to the limitation contained herein (including, without limitation, any other Debentures or the Warrants) beneficially
owned by the Holder or any of its Affiliates or Attribution Parties. Except as set forth in the preceding sentence, for purposes of
this Section 4(d), beneficial ownership shall be calculated in accordance with Section 13(d) of the Exchange Act and the rules and
regulations promulgated thereunder. To the extent that the limitation contained in this Section 4(d) applies, the determination of
whether this Debenture is convertible (in relation to other securities owned by the Holder together with any Affiliates and
Attribution Parties) and of which principal amount of this Debenture is convertible shall be in the sole discretion of the Holder,
and the submission of a Notice of Conversion shall be deemed to be the Holder’s determination of whether this Debenture may be
converted (in relation to other securities owned by the Holder together with any Affiliates or Attribution Parties) and which
principal amount of this Debenture is convertible, in each case subject to the Beneficial Ownership Limitation, and the Company
shall have no obligation to verify or confirm the accuracy of such determination. In addition, a determination as to any group
status as contemplated above shall be determined in accordance with Section 13(d) of the Exchange Act and the rules and regulations
promulgated thereunder. For purposes of this Section 4(d), in determining the number of outstanding shares of Common Stock, the
Holder may rely on the number of outstanding shares of Common Stock as reflected in (A) the Company’s most recent periodic or
annual report filed with the Commission, as the case may be, (B) a more recent public announcement by the Company, or (C) a more
recent written notice by the Company or the Company’s transfer agent setting forth the number of shares of Common Stock
outstanding. Upon the written or oral request of a Holder, the Company shall within one Trading Day confirm orally and in writing to
the Holder the number of shares of Common Stock then outstanding. In any case, the number of outstanding shares of Common Stock
shall be determined after giving effect to the conversion or exercise of securities of the Company, including this Debenture, by the
Holder or its Affiliates since the date as of which such number of outstanding shares of Common Stock was reported. The
“Beneficial Ownership Limitation” shall be 4.99% of the number of shares of the Common Stock outstanding
immediately after giving effect to the issuance of shares of Common Stock issuable upon conversion of this Debenture. The Holder,
upon notice to the Company, may increase or decrease the Beneficial Ownership Limitation provisions of this Section 4(d), provided
that the Beneficial Ownership Limitation in no event exceeds 9.99% of the number of shares of the Common Stock outstanding
immediately after giving effect to the issuance of shares of Common Stock upon conversion of this Debenture held by the Holder and
the Beneficial Ownership Limitation provisions of this Section 4(d) shall continue to apply. Any increase in the Beneficial
Ownership Limitation will not be effective until the 61st day after such notice is delivered to the Company. The
Beneficial Ownership Limitation provisions of this paragraph shall be construed and implemented in a manner otherwise than in strict
conformity with the terms of this Section 4(d) to correct this paragraph (or any portion hereof) which may be defective or
inconsistent with the intended Beneficial Ownership Limitation contained herein or to make changes or supplements necessary or
desirable to properly give effect to such limitation. The limitations contained in this paragraph shall apply to a successor holder
of this Debenture.
Section 5. Certain Adjustments.
a) Stock
Dividends and Stock Splits. If the Company, at any time while this Debenture is outstanding: (i) pays a stock dividend or otherwise
makes a distribution or distributions payable in shares of Common Stock on shares of Common Stock or any Common Stock Equivalents (which,
for avoidance of doubt, shall not include any shares of Common Stock issued by the Company upon conversion of, or payment of interest
on, the Debentures), (ii) subdivides outstanding shares of Common Stock into a larger number of shares, (iii) combines (including by way
of a reverse stock split) outstanding shares of Common Stock into a smaller number of shares or (iv) issues, in the event of a reclassification
of shares of the Common Stock, any shares of capital stock of the Company, then the Conversion Price shall be multiplied by a fraction
of which the numerator shall be the number of shares of Common Stock (excluding any treasury shares of the Company) outstanding immediately
before such event, and of which the denominator shall be the number of shares of Common Stock outstanding immediately after such event.
Any adjustment made pursuant to this Section shall become effective immediately after the record date for the determination of stockholders
entitled to receive such dividend or distribution and shall become effective immediately after the effective date in the case of a subdivision,
combination or re-classification.
b) Subsequent Equity
Sales. If, at any time while this Debenture is outstanding, the Company or any Subsidiary, as applicable, sells or grants any
option to purchase or sells or grants any right to reprice, or otherwise disposes of or issues (or announces any sale, grant or any
option to purchase or other disposition), any Common Stock or Common Stock Equivalents entitling any Person to acquire shares of
Common Stock at an effective price per share that is lower than the then Conversion Price (such lower price, the “Base
Conversion Price” and such issuances, collectively, a “Dilutive Issuance”) (if the holder of the Common
Stock or Common Stock Equivalents so issued shall at any time, whether by operation of purchase price adjustments, reset provisions,
floating conversion, exercise or exchange prices or otherwise, or due to warrants, options or rights per share which are issued in
connection with such issuance, be entitled to receive shares of Common Stock at an effective price per share that is lower than the
Conversion Price, such issuance shall be deemed to have occurred for less than the Conversion Price on such date of the Dilutive
Issuance), then simultaneously with the consummation (or, if earlier, the announcement) of each Dilutive Issuance the Conversion
Price shall be reduced to equal the Base Conversion Price, (subject to adjustment for reverse and forward stock splits,
recapitalizations and similar transactions following the date of the Purchase Agreement). Notwithstanding the foregoing, no
adjustment will be made under this Section 5(b) in respect of an Exempt Issuance. If the Company enters into a Variable Rate
Transaction, despite the prohibition set forth in the Purchase Agreement, the Company shall be deemed to have issued Common Stock or
Common Stock Equivalents at the lowest possible conversion price at which such securities may be converted or exercised. The Company
shall notify the Holder in writing, no later than the Trading Day following the issuance of any Common Stock or Common Stock
Equivalents subject to this Section 5(b), indicating therein the applicable issuance price, or applicable reset price, exchange
price, conversion price and other pricing terms (such notice, the “Dilutive Issuance Notice”). For purposes of
clarification, whether or not the Company provides a Dilutive Issuance Notice pursuant to this Section 5(b), upon the occurrence of
any Dilutive Issuance, the Holder is entitled to receive a number of Conversion Shares based upon the Base Conversion Price on or
after the date of such Dilutive Issuance, regardless of whether the Holder accurately refers to the Base Conversion Price in the
Notice of Conversion. In the event the applicable Trading Market requires, mandates, and/or imposes a “floor price” on
the Base Conversion Price, (such price, the “Floor Price”), and such Floor Price is greater the Base Conversion
Price absent such Floor Price, than the Company shall pay to the Holder, in cash and within 2 Trading Days of the applicable
Conversion Date, an amount equal to the product of (i) the number of Conversion Shares issuable pursuant to such Conversion Date and
(ii) the difference between (A) the Base Conversion Price (ignoring for such purposes the Floor Price) and (B) the Floor Price (the
“Conversion Cash Amount”). In the event that the Conversion Cash Amount is not paid within 2 Trading Days of the
applicable Conversion Date, the Conversion Cash Amount shall accrue interest equal to the lesser of 18% per annum or the maximum
rate permitted under applicable law thereafter until paid in full.
c) Subsequent
Rights Offerings. In addition to any adjustments pursuant to Section 5(a) above, if at any time the Company grants, issues or sells
any Common Stock Equivalents or rights to purchase stock, warrants, securities or other property pro rata to the record holders of any
class of shares of Common Stock (the “Purchase Rights”), then the Holder will be entitled to acquire, upon the terms
applicable to such Purchase Rights, the aggregate Purchase Rights which the Holder could have acquired if the Holder had held the number
of shares of Common Stock acquirable upon complete conversion of this Debenture (without regard to any limitations on exercise hereof,
including without limitation, the Beneficial Ownership Limitation) immediately before the date on which a record is taken for the grant,
issuance or sale of such Purchase Rights, or, if no such record is taken, the date as of which the record holders of shares of Common
Stock are to be determined for the grant, issue or sale of such Purchase Rights (provided, however, that, to the extent
that the Holder’s right to participate in any such Purchase Right would result in the Holder exceeding the Beneficial Ownership
Limitation, then the Holder shall not be entitled to participate in such Purchase Right to such extent (or beneficial ownership of such
shares of Common Stock as a result of such Purchase Right to such extent) and such Purchase Right to such extent shall be held in abeyance
for the Holder until such time, if ever, as its right thereto would not result in the Holder exceeding the Beneficial Ownership Limitation).
d) Pro Rata
Distributions. During such time as this Debenture is outstanding, if the Company shall declare or make any dividend or other
distribution of its assets (or rights to acquire its assets) to holders of shares of Common Stock, by way of return of capital or
otherwise (including, without limitation, any distribution of cash, stock or other securities, property or options by way of a
dividend, spin off, reclassification, corporate rearrangement, scheme of arrangement or other similar transaction) (a
“Distribution”), at any time after the issuance of this Debenture, then, in each such case, the Holder shall be
entitled to participate in such Distribution to the same extent that the Holder would have participated therein if the Holder had
held the number of shares of Common Stock acquirable upon complete conversion of this Debenture (without regard to any limitations
on conversion hereof, including without limitation, the Beneficial Ownership Limitation) immediately before the date of which a
record is taken for such Distribution, or, if no such record is taken, the date as of which the record holders of shares of Common
Stock are to be determined for the participation in such Distribution (provided, however, that, to the extent that the
Holder's right to participate in any such Distribution would result in the Holder exceeding the Beneficial Ownership Limitation,
then the Holder shall not be entitled to participate in such Distribution to such extent (or in the beneficial ownership of any
shares of Common Stock as a result of such Distribution to such extent) and the portion of such Distribution shall be held in
abeyance for the benefit of the Holder until such time, if ever, as its right thereto would not result in the Holder exceeding the
Beneficial Ownership Limitation).
e) Fundamental
Transaction. If, at any time while this Debenture is outstanding, (i) the Company, directly or indirectly, in one or more
related transactions effects any merger or consolidation of the Company with or into another Person, (ii) the Company (and all of
its Subsidiaries, taken as a whole), directly or indirectly, effects any sale, lease, license, assignment, transfer, conveyance or
other disposition of all or substantially all of its assets in one or a series of related transactions, (iii) any, direct or
indirect, purchase offer, tender offer or exchange offer (whether by the Company or another Person) is completed pursuant to which
holders of Common Stock are permitted to sell, tender or exchange their shares for other securities, cash or property and has been
accepted by the holders of 50% or more of the outstanding Common Stock, (iv) the Company, directly or indirectly, in one or more
related transactions effects any reclassification, reorganization or recapitalization of the Common Stock or any compulsory share
exchange pursuant to which the Common Stock is effectively converted into or exchanged for other securities, cash or property, or
(v) the Company, directly or indirectly, in one or more related transactions consummates a stock or share purchase agreement or
other business combination (including, without limitation, a reorganization, recapitalization, spin-off, merger or scheme of
arrangement) with another Person or group of Persons whereby such other Person or group acquires more than 50% of the outstanding
shares of Common Stock (not including any shares of Common Stock held by the other Person or other Persons making or party to, or
associated or affiliated with the other Persons making or party to, such stock or share purchase agreement or other business
combination) (each a “Fundamental Transaction”), then, upon any subsequent conversion of this Debenture, the
Holder shall have the right to receive, for each Conversion Share that would have been issuable upon such conversion immediately
prior to the occurrence of such Fundamental Transaction (without regard to any limitation in Section 4(d) and Section 4(e) on the
conversion of this Debenture), the number of shares of Common Stock of the successor or acquiring corporation or of the Company, if
it is the surviving corporation, and any additional consideration (the “Alternate Consideration”) receivable as a
result of such Fundamental Transaction by a holder of the number of shares of Common Stock for which this Debenture is convertible
immediately prior to such Fundamental Transaction (without regard to any limitation in Section 4(d) and Section 4(e) on the
conversion of this Debenture). For purposes of any such conversion, the determination of the Conversion Price shall be appropriately
adjusted to apply to such Alternate Consideration based on the amount of Alternate Consideration issuable in respect of one (1)
share of Common Stock in such Fundamental Transaction, and the Company shall apportion the Conversion Price among the Alternate
Consideration in a reasonable manner reflecting the relative value of any different components of the Alternate Consideration. If
holders of Common Stock are given any choice as to the securities, cash or property to be received in a Fundamental Transaction,
then the Holder shall be given the same choice as to the Alternate Consideration it receives upon any conversion of this Debenture
following such Fundamental Transaction. 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 Debenture and the other Transaction Documents (as defined in the Purchase Agreement) in accordance with the provisions of
this Section 5(e) pursuant to written agreements in form and substance reasonably satisfactory to the Holder and approved by the
Holder (without unreasonable delay) prior to such Fundamental Transaction and shall, at the option of the holder of this Debenture,
deliver to the Holder in exchange for this Debenture a security of the Successor Entity evidenced by a written instrument
substantially similar in form and substance to this Debenture which is convertible for a corresponding number of shares of capital
stock of such Successor Entity (or its parent entity) equivalent to the shares of Common Stock acquirable and receivable upon
conversion of this Debenture (without regard to any limitations on the conversion of this Debenture) prior to such Fundamental
Transaction, and with a conversion price which applies the conversion price hereunder to such shares of capital stock (but taking
into account the relative value of the shares of Common Stock pursuant to such Fundamental Transaction and the value of such shares
of capital stock, such number of shares of capital stock and such conversion price being for the purpose of protecting the economic
value of this Debenture immediately prior to the consummation of such Fundamental Transaction), and which is reasonably satisfactory
in form and substance to the Holder. Upon the occurrence of any such Fundamental Transaction, the Successor Entity shall succeed to,
and be substituted for (so that from and after the date of such Fundamental Transaction, the provisions of this Debenture and the
other Transaction Documents referring to the “Company” shall refer instead to the Successor Entity), and may exercise
every right and power of the Company and shall assume all of the obligations of the Company under this Debenture and the other
Transaction Documents with the same effect as if such Successor Entity had been named as the Company herein.
f) Calculations.
All calculations under this Section 5 shall be made to the nearest cent or the nearest 1/100th of a share, as the case may be. For purposes
of this Section 5, the number of shares of Common Stock deemed to be issued and outstanding as of a given date shall be the sum of the
number of shares of Common Stock (excluding any treasury shares of the Company) issued and outstanding.
g)
Notice to the Holder.
i. Adjustment
to Conversion Price. Whenever the Conversion Price is adjusted pursuant to any provision of this Section 5, the Company shall promptly
deliver to each Holder a notice setting forth the Conversion Price after such adjustment and setting forth a brief statement of the facts
requiring such adjustment.
ii. Notice
to Allow Conversion by Holder. If (A) the Company shall declare a dividend (or any other distribution in whatever form) on the Common
Stock, (B) the Company shall declare a special nonrecurring cash dividend on or a redemption of the Common Stock, (C) the Company shall
authorize the granting to all holders of the Common Stock of rights or warrants to subscribe for or purchase any shares of capital stock
of any class or of any rights, (D) the approval of any stockholders of the Company shall be required in connection with any reclassification
of the Common Stock, any consolidation or merger to which the Company(and all of its Subsidiaries, taken as a whole) is a party, any sale
or transfer of all or substantially all of the assets of the Company, or any compulsory share exchange whereby the Common Stock is converted
into other securities, cash or property or (E) the Company shall authorize the voluntary or involuntary dissolution, liquidation or winding
up of the affairs of the Company, then, in each case, the Company shall cause to be filed at each office or agency maintained for the
purpose of conversion of this Debenture, and shall cause to be delivered to the Holder at its last address as it shall appear upon the
Debenture Register, at least twenty (20) calendar days prior to the applicable record or effective date hereinafter specified, a notice
stating (x) the date on which a record is to be taken for the purpose of such dividend, distribution, redemption, rights or warrants,
or if a record is not to be taken, the date as of which the holders of the Common Stock of record to be entitled to such dividend, distributions,
redemption, rights or warrants are to be determined or (y) the date on which such reclassification, consolidation, merger, sale, transfer
or share exchange is expected to become effective or close, and the date as of which it is expected that holders of the Common Stock of
record shall be entitled to exchange their shares of the Common Stock for securities, cash or other property deliverable upon such reclassification,
consolidation, merger, sale, transfer or share exchange, provided that the failure to deliver such notice or any defect therein or in
the delivery thereof shall not affect the validity of the corporate action required to be specified in such notice. To the extent that
any notice provided hereunder constitutes, or contains, material, non-public information regarding the Company or any of the Subsidiaries,
the Company shall simultaneously file such notice with the Commission pursuant to a Current Report on Form 8-K. The Holder shall remain
entitled to convert this Debenture during the 20-day period commencing on the date of such notice through the effective date of the event
triggering such notice except as may otherwise be expressly set forth herein.
Section 6. Redemption.
a) Monthly
Redemption. On each Monthly Redemption Date, the Company shall redeem the Monthly Redemption Amount (the “Monthly
Redemption”). The Monthly Redemption Amount payable on each Monthly Redemption Date shall be paid in cash; provided, however,
as to any Monthly Redemption and upon 30 Trading Days’ prior written irrevocable notice (the “Monthly Redemption
Notice”), in lieu of a cash redemption payment the Company may elect to pay all or part of a Monthly Redemption Amount in
Conversion Shares based on a conversion price equal to the lowest of (i) the then Conversion Price, (ii) 80% of the daily VWAP on
the Trading Day immediately prior to the Monthly Redemption Date, and (iii) 80% of the lowest daily VWAP in the ten (10) Trading
Days immediately prior to the Monthly Redemption Date (the lowest price calculated pursuant to the foregoing (i), (ii), and (iii) on
each Monthly Redemption Date, the “Monthly Conversion Price” such 10 Trading Day period, the “Monthly
Conversion Period”); provided, further, that the Company may not pay the Monthly Redemption Amount in
Conversion Shares unless (y) from the date the Holder receives the duly delivered Monthly Redemption Notice through and until the
date such Monthly Redemption is paid in full, the Equity Conditions have been satisfied, unless waived in writing by the Holder, and
(z) as to such Monthly Redemption, at least twenty (20) calendar days prior to such Monthly Redemption Date, the Company shall have
delivered to the Holder’s account with The Depository Trust Company a number of shares of Common Stock to be applied against
such Monthly Redemption Amount equal to the quotient of (x) the applicable Monthly Redemption Amount divided by (y) the lesser of
(A) the Conversion Price and (B) the prior month’s Monthly Conversion Price (the “Pre- Redemption Conversion
Shares”). On the date of the Initial Release, the Company shall deliver a number of Pre-Redemption Conversion Shares to
each Holder equal to each Holder’s pro-rata portion of the Monthly Redemption Amount divided by the VWAP of the Common Stock
on the Trading Day immediately preceding the Original Issue Date. The Holder may convert, pursuant to Section 4(a), any principal
amount of this Debenture subject to a Monthly Redemption at any time prior to the date that the Monthly Redemption Amount, plus
accrued but unpaid interest, liquidated damages and any other amounts then owing to the Holder are due and paid in full. Unless
otherwise indicated by the Holder in the applicable Notice of Conversion, any principal amount of this Debenture converted during
the applicable Monthly Conversion Period until the date the Monthly Redemption Amount is paid in full shall be first applied to the
principal amount subject to the Monthly Redemption Amount payable in cash and then to the Monthly Redemption Amount payable in
Conversion Shares. Any principal amount of this Debenture converted during the applicable Monthly Conversion Period in excess of the
Monthly Redemption Amount shall be applied against the last principal amount of this Debenture scheduled to be redeemed hereunder,
in reverse time order from the Maturity Date; provided, however, if any such conversion is applied against such
Monthly Redemption Amount, the Pre-Redemption Conversion Shares, if any were issued in connection with such Monthly Redemption or
were not already applied to such conversions, shall be first applied against such conversion. The Company covenants and agrees that
it will honor all Notices of Conversion tendered up until such amounts are paid in full. The Company’s determination to pay a
Monthly Redemption in cash, shares of Common Stock or a combination thereof shall be applied ratably to all of the holders of the
then outstanding Debentures based on their (or their predecessor’s) initial purchases of Debentures pursuant to the Purchase
Agreement. At any time the Company delivers a notice to the Holder of its election to pay the Monthly Redemption Amount in shares of
Common Stock, the Company shall file a prospectus supplement pursuant to Rule 424 disclosing such election. In addition to the
foregoing, if the Company fails to satisfy the Equity Conditions during any Monthly Conversion Period, the Monthly Redemption shall
be paid in cash at the rate of 110.0% of the applicable Monthly Redemption Amount. In the event the Company has elected to pay a
Monthly Redemption in shares, and the applicable Trading Market requires, mandates, and/or imposes a Floor Price, and such Floor
Price is greater the Monthly Conversion Price absent such Floor Price, then in addition to the payment of a Monthly Redemption in
Conversion Shares (which issuance shall be at the Floor Price), the Company shall pay to the Holder cash as a true-up (the
“Cash True-Up Amount”). The Cash True-Up Amount shall be determined by the difference between (i) the Monthly
Redemption Amount, and (ii) the product of (a) the Monthly Conversion Price and (b) the number of Conversion Shares (the
“Conversion Cash Amount”). The Company and Holder agrees to adjust the foregoing formula, in good-faith, in the
event that the formula does not represent the intent of the Cash True-Up Amount. The intent of the Cash True-Up Amount is to
compensate the Holder for its loss in value due to the condition that a Monthly Redemption Amount cannot be converted into shares of
Common Stock at the Monthly Conversion Price. In the event that the Conversion Cash Amount is not paid within 2 Trading Days of the
applicable Conversion Date, the Conversion Cash Amount shall accrue interest equal to the lesser of 18% per annum or the maximum
rate permitted under applicable law thereafter until paid in full
b) Acceleration
of Monthly Redemption Amounts. Notwithstanding anything herein to the contrary, at any time during the period commencing on a Monthly
Redemption Date (a “Current Installment Date”) and ending on the Trading Day immediately prior to the next Monthly
Redemption Date (each, an “Installment Period”), but solely to the extent the Company has elected to pay the Monthly
Redemption Amount in Conversion Shares with respect to such Current Installment Date, at the option of the Holder, at one or more times,
the Holder may convert other Monthly Redemption Amounts (each, an “Acceleration”, and each such amount, an “Acceleration
Amount”), in whole or in part, at then Monthly Conversion Price of such Current Installment Date in accordance with the conversion
procedures set forth in Section 6(a) hereunder, mutatis mutandis. Notwithstanding the foregoing, with respect to any given Installment
Period, the Holder may not elect to effect any Acceleration (a “Current Acceleration”) during such Installment Period
if the sum of (x) the Acceleration Amounts with respect to Accelerations previously consummated by the Holder during the applicable Installment
Period and (y) the Acceleration Amount of such Current Acceleration, collectively, exceeds three (3) times the Installment Amount with
respect to such Current Installment Date.
c) Redemption
Procedure. The payment of cash or issuance of Common Stock, as applicable, pursuant to a Monthly Redemption shall be payable on
the Monthly Redemption Date. If any portion of the payment pursuant to a Monthly 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 18% per annum or the maximum rate
permitted by applicable law until such amount is paid in full. Notwithstanding anything herein contained to the contrary, if any
portion of the Monthly Redemption Amount remains unpaid after such date, the Holder may elect, by written notice to the Company
given at any time thereafter, to invalidate such Monthly Redemption, ab initio. Notwithstanding anything to the contrary in
this Section 6, the Company’s determination to redeem in cash or its elections under Section 6(a) shall be applied ratably
among the Holders of Debentures. The Holder may elect to convert the outstanding principal amount of the Debenture pursuant to
Section 4 prior to actual payment in cash for any redemption under this Section 6 by the delivery of a Notice of Conversion to the
Company.
d) Special
Redemption Upon Subsequent Financing. Following a subsequent financing by the Company after the Original Issue Date, other than with
respect of an Exempt Issuance (as defined in the Purchase Agreement), a Holder may deliver a notice to the Company (an “Financing
Redemption Notice” and the date such notice is deemed delivered hereunder, the “Financing Redemption Notice Date”)
of its election to require the Company to redeem some or all of the then outstanding principal amount of this Debenture for cash in an
amount equal to the Financing Redemption Amount on the 5th Trading Day following the Financing Redemption Notice Date (such
date, the “Financing Redemption Date”, such 5 Trading Day period, the “Financing Redemption Period”
and such redemption, the “Financing Redemption”). The Financing Redemption Amount is payable in full on the Financing
Redemption Date.
Section 7.
Negative Covenants. As long as any portion of this Debenture remains outstanding, unless the holders of at least 67% in principal
amount of the then outstanding Debentures shall have otherwise given prior written consent, the Company shall not, and shall not permit
any of the Subsidiaries to, directly or indirectly:
a) enter
into, create, incur, assume, guarantee or suffer to exist any indebtedness for borrowed money of any kind, including, but not limited
to, a guarantee, on or with respect to any of its property or assets now owned or hereafter acquired or any interest therein or any income
or profits therefrom;
b) enter
into, create, incur, assume or suffer to exist any Liens of any kind, on or with respect to any of its property or assets now owned or
hereafter acquired or any interest therein or any income or profits therefrom;
c) amend
its charter documents, including, without limitation, its certificate of incorporation and bylaws, in any manner that materially and adversely
affects any rights of the Holder;
d) repay, repurchase or
offer to repay, repurchase or otherwise acquire more than a de minimis number of shares of its Common Stock or Common Stock
Equivalents other than as to (i) the Conversion Shares or Warrant Shares as permitted or required under the Transaction Documents
and (ii) repurchases of Common Stock or Common Stock Equivalents of departing officers and directors of the Company, provided that
such repurchases shall not exceed an aggregate of $100,000 for all officers and directors during the term of this Debenture;
e) repay,
repurchase or offer to repay, repurchase or otherwise acquire any Indebtedness, other than the Debentures if on a pro-rata basis, other
than regularly scheduled principal and interest payments as such terms are in effect as of the Original Issue Date, provided that such
payments shall not be permitted if, at such time, or after giving effect to such payment, any Event of Default exist or occur;
f)
pay cash dividends or distributions on any equity securities of the Company;
g) enter
into any transaction with any Affiliate of the Company which would be required to be disclosed in any public filing with the Commission,
unless such transaction is made on an arm’s-length basis and expressly approved by a majority of the disinterested directors of
the Company (even if less than a quorum otherwise required for board approval); or
h)
enter into any agreement with respect to any of the foregoing.
Section 8. Events of Default.
a) “Event
of Default” means, wherever used herein, any of the following events (whatever the reason for such event and whether such event
shall be voluntary or involuntary or effected by operation of law or pursuant to any judgment, decree or order of any court, or any order,
rule or regulation of any administrative or governmental body), is not cured within 5 trading days, unless otherwise provided below:
i. any
default in the payment of (A) the principal amount of any Debenture or (B) interest, liquidated damages and other amounts owing to a Holder
on any Debenture, as and when the same shall become due and payable (whether on a Conversion Date or the Maturity Date or by acceleration
or otherwise) which default, solely in the case of an interest payment or other default under clause (B) above, is not cured within 3
Trading Days;
ii. the
Company shall fail to observe or perform any other covenant or agreement contained in the Debentures (other than a breach by the Company
of its obligations to deliver shares of Common Stock to the Holder upon conversion, which breach is addressed in clause (xi) below) or
in any Transaction Document, which failure is not cured, if possible to cure, within the earlier to occur of (A) 5 Trading Days after
notice of such failure sent by the Holder or by any other Holder to the Company and (B) 10 Trading Days after the Company has become or
should have become aware of such failure;
iii.
a default or event of default (subject to any grace or cure period provided in the applicable agreement, document or instrument)
shall occur under (A) any of the Transaction Documents or (B) any other material agreement, lease, document or instrument to which
the Company or any Subsidiary is obligated (and not covered by clause (vi) below);
iv. any
representation or warranty made in this Debenture, any other Transaction Documents, any written statement pursuant hereto or thereto or
any other report, financial statement or certificate made or delivered to the Holder or any other Holder shall be untrue or incorrect
in any material respect as of the date when made or deemed made;
v. the
Company or any Significant Subsidiary (as such term is defined in Rule 1-02(w) of Regulation S-X) shall be subject to a Bankruptcy Event;
vi. the
Company or any Subsidiary shall default on any of its obligations under any mortgage, credit agreement or other facility, indenture agreement,
factoring agreement or other instrument under which there may be issued, or by which there may be secured or evidenced, any indebtedness
for borrowed money or money due under any long term leasing or factoring arrangement that (a) involves an obligation greater than $150,000,
whether such indebtedness now exists or shall hereafter be created, and (b) results in such indebtedness becoming or being declared due
and payable prior to the date on which it would otherwise become due and payable;
vii. the
Common Stock shall not be eligible for listing or quotation for trading on a Trading Market and shall not be eligible to resume listing
or quotation for trading thereon within five Trading Days;
viii. the
Company (and all of its Subsidiaries, taken as a whole) shall be a party to any Change of Control Transaction or Fundamental Transaction
or shall agree to sell or dispose of all or in excess of 33% of its assets in one transaction or a series of related transactions (whether
or not such sale would constitute a Change of Control Transaction);
ix. the
Company shall fail for any reason to deliver Conversion Shares to a Holder prior to the fifth Trading Day after a Conversion Date pursuant
to Section 4(c) or the Company shall provide at any time notice to the Holder, including by way of public announcement, of the Company’s
intention to not honor requests for conversions of any Debentures in accordance with the terms hereof;
x. any
Person shall breach any agreement delivered to the initial Holders pursuant to Section 2.2 of the Purchase Agreement;
xi. the
electronic transfer by the Company of shares of Common Stock through the Depository Trust Company or another established clearing corporation
is no longer available or is subject to a “chill”;
xii. any
monetary judgment, writ or similar final process shall be entered or filed against the Company, any subsidiary or any of their respective
property or other assets for more than $100,000, and such judgment, writ or similar final process shall remain unvacated, unbonded or
unstayed for a period of 45 calendar days; or
xiii. a
false or inaccurate certification (including a false or inaccurate deemed certification) by the Company that the Equity Conditions are
satisfied or that there has been no Equity Conditions Failure or as to whether any Event of Default has occurred.
xiv. the
Company’s Common Stock ceases to be listed on the Trading Market, or the Company receives notice from its Trading Market of non-
compliance with a continued listing standard and the Company fails to cure such non-compliance in the permitted Nasdaq cure period;
b) Remedies Upon
Event of Default. If any Event of Default occurs, the outstanding principal amount of this Debenture, plus accrued but unpaid
interest, liquidated damages and other amounts owing in respect thereof through the date of acceleration, shall become, at the
Holder’s election, immediately due and payable in cash at the Mandatory Default Amount. Commencing five (5) days after the
occurrence of any Event of Default that results in the eventual acceleration of this Debenture, the interest rate on this Debenture
shall accrue at an interest rate equal to the lesser of 18% per annum or the maximum rate permitted under applicable law. Upon the
payment in full of the Mandatory Default Amount, the Holder shall promptly surrender this Debenture to or as directed by the
Company. In connection with such acceleration described herein, the Holder need not provide, and the Company hereby waives, any
presentment, demand, protest or other notice of any kind, and the Holder may immediately and without expiration of any grace period
enforce any and all of its rights and remedies hereunder and all other remedies available to it under applicable law. Such
acceleration may be rescinded and annulled by Holder at any time prior to payment hereunder and the Holder shall have all rights as
a holder of the Debenture until such time, if any, as the Holder receives full payment pursuant to this Section 8(b). No such
rescission or annulment shall affect any subsequent Event of Default or impair any right consequent thereon.
Section 9. Miscellaneous.
a) Notices.
Any and all notices or other communications or deliveries to be provided by the Holder hereunder, including, without limitation, any Notice
of Conversion, shall be in writing and delivered personally, by email attachment, or sent by a nationally recognized overnight courier
service, addressed to the Company, at the address set forth above, or such other email address, or address as the Company may specify
for such purposes by notice to the Holder delivered in accordance with this Section 9(a). Any and all notices or other communications
or deliveries to be provided by the Company hereunder shall be in writing and delivered personally, by email attachment, or sent by a
nationally recognized overnight courier service addressed to each Holder at the email address or address of the Holder appearing on the
books of the Company, or if no such email attachment or address appears on the books of the Company, at the principal place of business
of such Holder, as set forth in the Purchase Agreement. Any notice or other communication or deliveries hereunder shall be deemed given
and effective on the earliest of (i) the date of transmission, if such notice or communication is delivered via email attachment to the
email address set forth on the signature pages attached hereto prior to 5:30 p.m. (New York City time) on any date, (ii) the next Trading
Day after the date of transmission, if such notice or communication is delivered via email attachment to the email address 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,
(iii) the second Trading Day following the date of mailing, if sent by U.S. nationally recognized overnight courier service or (iv) upon
actual receipt by the party to whom such notice is required to be given.
b) Absolute
Obligation. Except as expressly provided herein, no provision of this Debenture shall alter or impair the obligation of the
Company, which is absolute and unconditional, to pay the principal of, liquidated damages and accrued interest, as applicable, on
this Debenture at the time, place, and rate, and in the coin or currency, herein prescribed. This Debenture is a direct debt
obligation of the Company. This Debenture ranks pari passu with all other Debentures now or hereafter issued under the terms
set forth herein.
c) Lost
or Mutilated Debenture. If this Debenture shall be mutilated, lost, stolen or destroyed, the Company shall execute and deliver, in
exchange and substitution for and upon cancellation of a mutilated Debenture, or in lieu of or in substitution for a lost, stolen or destroyed
Debenture, a new Debenture for the principal amount of this Debenture so mutilated, lost, stolen or destroyed, but only upon receipt of
evidence of such loss, theft or destruction of such Debenture, and of the ownership hereof, reasonably satisfactory to the Company.
d) Governing
Law. All questions concerning the construction, validity, enforcement and interpretation of this Debenture 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 conflict of
laws thereof. Each party agrees that all legal proceedings concerning the interpretation, enforcement and defense of the transactions
contemplated by any of the Transaction Documents (whether brought against a party hereto or its respective Affiliates, directors, officers,
shareholders, employees or agents) shall be commenced in the state and federal courts sitting in the City of New York, Borough of Manhattan
(the “New York Courts”). Each party hereto hereby irrevocably submits to the exclusive jurisdiction of the New York
Courts 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 suit, action or proceeding, any claim that it is not personally subject to the jurisdiction of such New York Courts,
or such New York Courts are improper or inconvenient venue for such proceeding. Each party hereby irrevocably waives personal service
of process and consents to process being served in any such suit, action or proceeding by mailing a copy thereof via registered or certified
mail or overnight delivery (with evidence of delivery) to such party at the address in effect for notices to it under this Debenture 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 applicable law. Each party hereto hereby irrevocably
waives, to the fullest extent permitted by applicable law, any and all right to trial by jury in any legal proceeding arising out of or
relating to this Debenture or the transactions contemplated hereby. If any party shall commence an action or proceeding to enforce any
provisions of this Debenture, then the prevailing party in such action or proceeding shall be reimbursed by the other party for its attorneys
fees and other costs and expenses incurred in the investigation, preparation and prosecution of such action or proceeding.
e) Waiver. Any
waiver by the Company or the Holder of a breach of any provision of this Debenture shall not operate as or be construed to be a
waiver of any other breach of such provision or of any breach of any other provision of this Debenture. The failure of the Company
or the Holder to insist upon strict adherence to any term of this Debenture on one or more occasions shall not be considered a
waiver or deprive that party of the right thereafter to insist upon strict adherence to that term or any other term of this
Debenture on any other occasion. Any waiver by the Company or the Holder must be in writing.
f) Severability.
If any provision of this Debenture is invalid, illegal or unenforceable, the balance of this Debenture shall remain in effect, and if
any provision is inapplicable to any Person or circumstance, it shall nevertheless remain applicable to all other Persons and circumstances.
If it shall be found that any interest or other amount deemed interest due hereunder violates the applicable law governing usury, the
applicable rate of interest due hereunder shall automatically be lowered to equal the maximum rate of interest permitted under applicable
law. The Company covenants (to the extent that it may lawfully do so) that it shall not at any time insist upon, plead, or in any manner
whatsoever claim or take the benefit or advantage of, any stay, extension or usury law or other law which would prohibit or forgive the
Company from paying all or any portion of the principal of or interest on this Debenture as contemplated herein, wherever enacted, now
or at any time hereafter in force, or which may affect the covenants or the performance of this Debenture, and the Company (to the extent
it may lawfully do so) hereby expressly waives all benefits or advantage of any such law, and covenants that it will not, by resort to
any such law, hinder, delay or impede the execution of any power herein granted to the Holder, but will suffer and permit the execution
of every such as though no such law has been enacted.
g) Remedies,
Characterizations, Other Obligations, Breaches and Injunctive Relief. The remedies provided in this Debenture shall be cumulative
and in addition to all other remedies available under this Debenture and any of the other Transaction Documents at law or in equity (including
a decree of specific performance and/or other injunctive relief), and 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 Debenture. 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, conversion 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 such breach or any such threatened
breach, without the necessity of showing economic loss and without any bond or other security being required. The Company shall provide
all information and documentation to the Holder that is requested by the Holder to enable the Holder to confirm the Company’s compliance
with the terms and conditions of this Debenture.
h) Next
Business Day. Whenever any payment or other obligation hereunder shall be due on a day other than a Business Day, such payment shall
be made on the next succeeding Business Day.
i) Headings.
The headings contained herein are for convenience only, do not constitute a part of this Debenture and shall not be deemed to limit or
affect any of the provisions hereof.
Section 10. Disclosure. Upon
receipt or delivery by the Company of any notice in accordance with the terms of this Debenture, 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 within two (2) Business Days after 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, non-public 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.
*********************
(Signature Page Follows)
IN WITNESS WHEREOF, the Company
has caused this Debenture to be duly executed by a duly authorized officer as of the date first above indicated.
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WETRADE GROUP INC. |
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By: |
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Name: |
Wei HeChun |
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Title: |
CEO |
ANNEX A
NOTICE OF CONVERSION
The undersigned
hereby elects to convert principal under the 30% Original Issue Discount Senior Secured Convertible Debenture due August , 2024 of WeTrade
Group Inc., a Wyoming corporation (the “Company”), into shares of common stock (the “Common Stock”),
of the Company according to the conditions hereof, as of the date written below. If shares of Common Stock are to be issued in the name
of a person other than the undersigned, the undersigned will pay all transfer taxes payable with respect thereto and is delivering herewith
such certificates and opinions as reasonably requested by the Company in accordance therewith. No fee will be charged to the holder for
any conversion, except for such transfer taxes, if any.
By the delivery
of this Notice of Conversion the undersigned represents and warrants to the Company that its ownership of the Common Stock does not exceed
the amounts specified under Section 4 of this Debenture, as determined in accordance with Section 13(d) of the Exchange Act.
The undersigned agrees to comply with
the prospectus delivery requirements under the applicable securities laws in connection with any transfer of the aforesaid shares of Common
Stock.
Conversion calculations: |
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Date to Effect Conversion: |
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Principal Amount of Debenture to be Converted: |
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Payment of Interest in Common Stock _____________yes ______________no |
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If yes, $__________ of Interest Accrued on
Account of |
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Conversion at Issue. |
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Number of shares of Common Stock to be issued: |
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Signature: |
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Name: |
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Address for Delivery of Common Stock Certificates:
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Or |
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DWAC Instructions: |
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Broker No: |
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Account No: |
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27
Exhibit 10.1
SECURITIES PURCHASE AGREEMENT
This Securities Purchase
Agreement (this “Agreement”) is dated as of August 23, 2023, between WeTrade Group Inc., a Wyoming 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 Debentures (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, any day which is a federal legal holiday in the United States or any day on which commercial banks in The
City of New York are authorized or required by law to remain closed; or other governmental action to close; 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 the closing of the purchase and sale of the Securities pursuant to Section 2.1.
“Closing
Date” means the Trading Day on which all of the Transaction Documents have been executed and delivered by the applicable parties
thereto, and all conditions precedent to (i) the Purchasers’ obligations to pay the Subscription Amount and (ii) the Company’s
obligations to deliver the Securities, in each case, have been satisfied or waived.
“Closing Statement”
means the Closing Statement in the form on Annex A attached hereto.
“Commission” means
the United States Securities and Exchange Commission. “Common Stock” means the common stock of the Company, no par
value 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
Ortoli Rosenstadt LLP, with office located at 366 Madison Ave, 3Fl, New York, NY 10017.
“Conversion Price” shall have the meaning
ascribed to such term in the Debentures.
“Conversion
Shares” shall have the meaning ascribed to such term in the Debentures.
“Debentures”
means the 10% Original Issue Discount Senior Secured Convertible Debentures due, subject to the terms therein, eighteen (18) months from
their date of issuance, issued by the Company to the Purchasers hereunder, in the form of Exhibit A attached hereto.
“Disclosure
Schedules” shall have the meaning ascribed to such term in Section 3.1.
“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.
“Effective
Date” means the earliest of the date that (a) the initial Registration Statement has been declared effective by the Commission,
(b) all of the Underlying Shares have been sold pursuant to Rule 144 or may be sold pursuant to Rule 144 without the requirement for the
Company to be in compliance with the current public information required under Rule 144 and without volume or manner-of-sale restrictions,
(c) following the one year anniversary of the Closing Date provided that a holder of the Underlying Shares is not an Affiliate of the
Company or (d) all of the Underlying Shares may be sold pursuant to an exemption from registration under Section 4(a)(1) of the Securities
Act without volume or manner-of-sale restrictions and Company Counsel has delivered to such holders a standing written unqualified opinion
that resales may then be made by such holders of the Underlying Shares pursuant to such exemption which opinion shall be in form and substance
reasonably acceptable to such holders.
“Evaluation
Date” shall have the meaning ascribed to such term in Section 3.1(s).
“Exchange Act” means the
Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder.
“Exempt
Issuance” means the issuance of (a) shares of Common Stock or options to employees, officers or directors of the Company pursuant
to any stock or option plan duly adopted for such purpose, by a majority of the non-employee members of the Board of Directors or a majority
of the members of a committee of non-employee directors established for such purpose for services rendered to the Company, (b) securities
upon the exercise or exchange of or conversion of any Securities issued hereunder, warrants to the Purchasers in connection with the transactions
pursuant to this Agreement and any securities upon exercise of warrants to the Purchasers and/or other securities exercisable or exchangeable
for or convertible into shares of Common Stock issued and outstanding on the date of this Agreement, provided that such securities have
not been amended since the date of this Agreement to increase the number of such securities or to decrease the exercise price, exchange
price or conversion price of such securities (other than in connection with stock splits or combinations) or to extend the term of such
securities, and (c) securities issued pursuant to acquisitions or strategic transactions approved by a majority of the disinterested directors
of the Company, provided that such securities are issued as “restricted securities” (as defined in Rule 144) and carry no
registration rights that require or permit the filing of any registration statement in connection therewith during the prohibition period
in Section 4.13(a) herein, and provided that any such issuance shall only be to a Person (or to the equity holders of a Person) which
is, itself or through its subsidiaries, an operating company or an owner of an asset in a business synergistic with the business of the
Company and shall provide to the Company additional benefits in addition to the investment of funds, but shall not include a transaction
in which the Company is issuing securities primarily for the purpose of raising capital or to an entity whose primary business is investing
in securities.
“FCPA” means the Foreign Corrupt Practices
Act of 1977, as amended.
“GAAP” shall have the meaning ascribed to such term in Section 3.1(h).
“Indebtedness”
shall have the meaning ascribed to such term in Section 3.1(bb).
“Intellectual Property Rights”
shall have the meaning ascribed to such term in Section 3.1(o).
“Purchaser” means each
of the investors on Schedule A attached to this form,, their Affiliates, and any of their successors and/or assigns.
“Legend
Removal Date” shall have the meaning ascribed to such term in Section 4.1(c).
“Liens”
means a lien, charge, pledge, security interest, encumbrance, right of first refusal, preemptive right or other restriction.
“Material
Adverse Effect” shall have the meaning assigned to such term in Section 3.1(b).
“Material
Permits” shall have the meaning ascribed to such term in Section 3.1(m).
“Maturity Date” shall have the
meaning ascribed to such term in the Debentures.
“Maximum Rate” shall have the meaning ascribed to such term in
Section 5.17.
“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.
“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
“Proceeding”
means an action, claim, suit, investigation or proceeding (including, without limitation, an informal investigation or partial proceeding,
such as a deposition), whether commenced or threatened.
“Public
Information Failure” shall have the meaning ascribed to such term in Section 4.3(b).
“Public
Information Failure Payments” shall have the meaning ascribed to such term in Section 4.3(b).
“Purchaser Party” shall have the meaning
ascribed to such term in Section 4.10.
“Required
Approvals” shall have the meaning ascribed to such term in Section 3.1(e).
“Required
Minimum” means, as of any date, 300% of the maximum aggregate number of shares of Common Stock then issued or potentially
issuable in the future pursuant to the Transaction Documents, including any Underlying Shares issuable upon exercise in full of all
Warrants or conversion in full of all Debentures (including Underlying Shares issuable as payment of interest on the Debentures),
ignoring any conversion or exercise limits set forth therein, based on the Conversion Price and Exercise Price, respectively, then
in effect on each date of determination.
“Rule 144”
means Rule 144 promulgated by the Commission pursuant to the Securities Act, as such Rule may be amended or interpreted from time to time,
or any similar rule or regulation hereafter adopted by the Commission having substantially the same purpose and effect as such Rule.
“Rule 424”
means Rule 424 promulgated by the Commission pursuant to the Securities Act, as such Rule may be amended or interpreted from time to time,
or any similar rule or regulation hereafter adopted by the Commission having substantially the same purpose and effect as such Rule.
“SEC Reports” shall have the meaning ascribed to
such term in Section 3.1(h).
“Securities”
means, collectively, the Debentures, the Warrants, and the Underlying Shares.
“Securities
Act” means the Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder.
“Shareholder
Approval” means such approval as may be required by the applicable rules and regulations of the Nasdaq Stock Market (or any
successor entity) from the shareholders of the Company with respect to the transactions contemplated by the Transaction Documents, including
the issuance of all of the Underlying Shares in excess of 19.99% of the issued and outstanding Common Stock on the Closing Date and Section
3(b) of the Warrants, and Section 5(b) of the Debentures, and the approval to effect a reverse split of the Common Stock when necessary.
“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).
“Subscription
Amount” means, as to each Purchaser, the aggregate amount to be paid for Debentures and Warrants purchased hereunder as specified
below such Purchaser’s name on the signature page of this Agreement and next to the heading “Subscription Amount,” in
United States dollars and in immediately available funds.
“Subsequent
Financing” shall have the meaning ascribed to such term in Section 4.12(a).
“Subsequent
Financing Notice” shall have the meaning ascribed to such term in Section 4.12(b).
“Subsidiary”
means any subsidiary of the Company as set forth on Schedule 3.1(a) and shall, where applicable, also include any direct or indirect
subsidiary of the Company formed or acquired after the date hereof.
“Trading
Day” means a day on which the principal Trading Market is open for trading.
“Trading
Market” means any of the following markets or exchanges on which the Common Stock is listed or quoted for trading on the date
in question: the NYSE American, the Nasdaq Capital Market, the Nasdaq Global Market, the Nasdaq Global Select Market, the New York Stock
Exchange, the Pink Open Market, OTCQB or the OTCQX (or any successors to any of the foregoing).
“Transaction
Documents” means this Agreement, the Debentures, the Warrants, all exhibits and schedules thereto and hereto and any other documents
or agreements executed in connection with the transactions contemplated hereunder.
“Transfer
Agent” means Globex Transfer LLC, the current transfer agent of the Company, with a mailing address of 780 Deltona Blvd, Deltona,
FL 32725 and any successor transfer agent of the Company.
“Underlying
Shares” means the Warrant Shares and shares of Common Stock issued and issuable pursuant to the terms of the Debenture, including
without limitation, shares of Common Stock issued and issuable in lieu of the cash payment of interest on the Debentures in accordance
with the terms of the Debentures, in each case without respect to any limitation or restriction on the conversion of the Debentures or
the exercise of the Warrants.
“Variable
Rate Transaction” shall have the meaning ascribed to such term in Section 4.13(b).
“VWAP”
means, for any date, the price determined by the first of the following clauses that applies: (a) if the Common Stock is then listed or
quoted on a Trading Market, the daily volume weighted average price
of the Common Stock for such date (or the nearest preceding date) on the Trading Market on which the Common Stock is then listed or quoted
as reported by Bloomberg L.P. (based on a Trading Day from 9:30 a.m. (New York City time) to 4:02 p.m. (New York City time)), (b) if OTCQB
Venture Market (“OTCQB”) or OTCQX Best Market (“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 (“Pink
Market”) operated by OTC Markers, Inc. (or a similar organization or agency succeeding to its functions of reporting prices), the
most recent bid price per share of the Common Stock so reported, or (d) in all other cases, the fair market value of a share of Common
Stock as determined by an independent appraiser selected in good faith by the Purchasers of a majority in interest of the Securities then
outstanding and reasonably acceptable to the Company, the fees and expenses of which shall be paid by the Company.
“Warrants”
means, collectively, the Common Stock purchase warrants delivered to the Purchasers at the Closing in accordance with Section 2.2(a) hereof,
which Warrants shall be exercisable immediately and have a term of exercise equal to five (5) years, in the form of Exhibit C attached
hereto.
“Warrant
Shares” means the shares of Common Stock issuable upon exercise of the Warrants.
ARTICLE II.
PURCHASE AND SALE
2.1 Closing.
On the Closing Date, upon the terms and subject to the conditions set forth herein, substantially concurrent with the execution and delivery
of this Agreement by the parties hereto, the Company agrees to sell, and the Purchasers, severally and not jointly, agree to purchase,
up to an aggregate of $ in principal amount of the Debentures. Each Purchaser shall deliver to the Deposit Bank, via wire transfer or
a certified check, immediately available funds equal to such Purchaser’s Subscription Amount as set forth on the signature page
hereto executed by such Purchaser, and the Company shall deliver to each Purchaser its respective Debenture and a Warrant, as determined
pursuant to Section 2.2(a), and the Company and each Purchaser shall deliver the other items set forth in Section 2.2 deliverable at the
Closing. Upon satisfaction of the covenants and conditions set forth in Sections 2.2 and 2.3, the Closing shall take place remotely by
electronic transfer of the Closing documentation.
2.2 Deliveries.
(a) On
or prior to the Closing Date, the Company shall deliver or cause to be delivered to each Purchaser the following:
(i) this Agreement duly executed by the Company;
(ii) a
legal opinion of Company Counsel, substantially in the form of Exhibit D attached hereto;
(iii)
a Debenture with a principal amount equal to such Purchaser’s Principal Amount, registered in the name of such Purchaser;
(iv)
a Warrant registered in the name of such Purchaser to purchase up to a number of shares of Common Stock equal to 100% of such
Purchaser’s Conversion Shares on the Closing Date, with an exercise price equal to $4.76, subject to adjustment therein;
(v)
the Company shall have provided each Purchaser with the Company’s wire instructions, on Company letterhead and executed by the
Chief Executive Officer or Chief Financial Officer;
(b)
On or prior to the Closing Date, each Purchaser shall deliver or cause to be delivered to the Company or the Deposit Bank, as
applicable, the following:
(i) this Agreement duly executed by such Purchaser;
(ii)
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 Effects, 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) from
the date hereof to the Closing Date, trading in the Common Stock shall not have been suspended by the Commission or the Company’s
principal Trading Market and, at any time prior to the Closing Date, trading in securities generally as reported by Bloomberg L.P. shall
not have been suspended or limited, or minimum prices shall not have been established on securities whose trades are reported by such
service, or on any Trading Market, nor shall a banking moratorium have been declared either by the United States or New York State authorities
nor shall there have occurred any material outbreak or escalation of hostilities or other national or international calamity of such magnitude
in its effect on, or any material adverse change in, any financial market which, in each case, in the reasonable judgment of such Purchaser,
makes it impracticable or inadvisable to purchase the Securities at the Closing.
ARTICLE III.
REPRESENTATIONS AND WARRANTIES
3.1 Representations
and Warranties of the Company. Except as set forth in the Disclosure Schedules, which Disclosure Schedules shall be deemed a part
hereof and shall qualify any representation or otherwise made herein to the extent of the disclosure contained in the corresponding section
of the Disclosure Schedules, the Company hereby makes the following representations and warranties to each Purchaser:
(a) Subsidiaries.
All of the direct and indirect subsidiaries of the Company are set forth on Schedule 3.1(a). The Company owns, directly or
indirectly, all of the capital stock or other equity interests of each Subsidiary free and clear of any Liens, and all of the issued
and outstanding shares of capital stock of each Subsidiary are validly issued and are fully paid, non-assessable and free of
preemptive and similar rights to subscribe for or purchase securities. If the Company has no subsidiaries, all other references to
the Subsidiaries or any of them in the Transaction Documents shall be disregarded.
(b) Organization
and Qualification. The Company and each of the Subsidiaries is an entity duly incorporated or otherwise organized, validly
existing and in good standing under the laws of the jurisdiction of its incorporation or organization, with the requisite power and
authority to own and use its properties and assets and to carry on its business as currently conducted. Neither the Company nor any
Subsidiary is in violation nor default of any of the provisions of its respective certificate or articles of incorporation, bylaws
or other organizational or charter documents. Each of the Company and the Subsidiaries is duly qualified to conduct business and is
in good standing as a foreign corporation or other entity in each jurisdiction in which the nature of the business conducted or
property owned by it makes such qualification necessary, except where the failure to be so qualified or in good standing, as the
case may be, could not have or reasonably be expected to result in: (i) a material adverse effect on the legality, validity or
enforceability of any Transaction Document, (ii) a material adverse effect on the results of operations, assets, business, prospects
or condition (financial or otherwise) of the Company and the Subsidiaries, taken as a whole, or (iii) a material adverse effect on
the Company’s ability to perform in any material respect on a timely basis its obligations under any Transaction Document (any
of (i), (ii) or (iii), a “Material Adverse Effect”) and no Proceeding has been instituted in any such
jurisdiction revoking, limiting or curtailing or seeking to revoke, limit or curtail such power and authority or qualification.
(c) Authorization; Enforcement.
(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 and (iii) insofar as indemnification and contribution provisions may be limited by applicable law.
(ii) With
respect to the Subsidiary Guarantee, each of the Subsidiaries has the requisite corporate power and authority to enter into and to consummate
the transactions contemplated by such agreement and otherwise to carry out its obligations thereunder. The execution and delivery of the
Subsidiary Guarantee and the consummation by the Company of the transactions contemplated thereby have been duly authorized by all necessary action on
the part of the Company, and no further action is required by the respective Subsidiary, its managers or its members in connection therewith.
The Subsidiary Guarantee has been (or upon delivery will have been) duly executed by the respective Subsidiaries and, when delivered in
accordance with the terms thereof, will constitute the valid and binding obligation of the respective Subsidiary enforceable against such
Subsidiary in accordance with its terms, except (A) as listed by general equitable principals and applicable bankruptcy, insolvency, reorganization,
moratorium and other laws of general application affecting enforcement of creditors’ rights generally, (B) as limited by laws relating
to the availability of specific performance, injunctive relief or other equitable remedies and (C) 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) 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 could not
have or reasonably be expected to result in a Material Adverse Effect.
(e) Filings,
Consents and Approvals. The Company is not required to obtain any consent, waiver, authorization or order of, give any notice
to, or make any filing or registration with, any court or other federal, state, local or other governmental authority or other
Person in connection with the execution, delivery and performance by the Company of the Transaction Documents, other than: (i) the
filings required pursuant to Section 4.6 of this Agreement, (ii) the notice and/or application(s) to each applicable Trading Market
for the issuance and sale of the Securities and the listing of the Conversion Shares and Warrant Shares for trading thereon in the
time and manner required thereby, and (iii) Shareholder Approval (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. The Underlying 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 Underlying Shares at least equal to
the Required Minimum on the date hereof.
(g) Capitalization.
The capitalization of the Company as of the date hereof is as set forth on Schedule 3.1(g), which Schedule 3.1(g)
shall also include the number of shares of Common Stock owned beneficially, and of record, by Affiliates of the Company as of the
date hereof. The Company has not issued any capital stock since its most recently filed periodic report under the Exchange Act,
other than pursuant to the exercise of employee stock options under the Company’s stock option plans, the issuance of shares
of Common Stock to employees pursuant to the Company’s employee stock purchase plans and pursuant to the conversion and/or
exercise of Common Stock Equivalents outstanding as of the date of the most recently filed periodic report under the Exchange Act.
No Person has any right of first refusal, preemptive right, right of participation, or any similar right to participate in the
transactions contemplated by the Transaction Documents. Except as set forth on Schedule 3.1(g), there are no outstanding
options, warrants, scrip rights to subscribe to, calls or commitments of any character whatsoever relating to, or securities, rights
or obligations convertible into or exercisable or exchangeable for, or giving any Person any right to subscribe for or acquire, any
shares of Common Stock or the capital stock of any Subsidiary, or contracts, commitments, understandings or arrangements by which
the Company or any Subsidiary is or may become bound to issue additional shares of Common Stock or Common Stock Equivalents or
capital stock of any Subsidiary. 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.
Other than the Shareholder Approval, no further approval or authorization of any stockholder, the Board of Directors or others is
required for the issuance and sale of the Securities. There are no stockholders agreements, voting agreements or other similar agreements with respect to the Company’s capital stock
to which the Company is a party or, to the knowledge of the Company, between or among any of the Company’s stockholders.
(h) SEC
Reports; Financial Statements. The Company has filed all reports, schedules, forms, statements and other documents required to be
filed by the Company under the Securities Act and the Exchange Act, including pursuant to Section 13(a) or 15(d) thereof, for the two
years preceding the date hereof (or such shorter period as the Company was required by law or regulation to file such material) (the foregoing
materials, including the exhibits thereto and documents incorporated by reference therein, being collectively referred to herein as the
“SEC Reports”) on a timely basis or has received a valid extension of such time of filing and has filed any such SEC
Reports prior to the expiration of any such extension. As of their respective dates, the SEC Reports complied in all material respects
with the requirements of the Securities Act and the Exchange Act, as applicable, and none of the SEC Reports, when filed, contained any
untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary in order to make the
statements therein, in the light of the circumstances under which they were made, not misleading. The Company has never been an issuer
subject to Rule 144(i) under the Securities Act. 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 set forth on Schedule 3.1(i), (i) there has been no event, occurrence or development that
has had or that could reasonably be expected to result in a Material Adverse Effect, (ii) the Company has not incurred any
liabilities (contingent or otherwise) other than (A) trade payables and accrued expenses incurred in the ordinary course of business
consistent with past practice and (B) liabilities not required to be reflected in the Company’s financial statements pursuant
to GAAP or disclosed in filings made with the Commission, (iii) the Company has not altered its method of accounting, (iv) the
Company has not declared or made any dividend or distribution of cash or other property to its stockholders or purchased, redeemed
or made any agreements to purchase or redeem any shares of its capital stock and (v) the Company has not issued any equity
securities to any officer, director or Affiliate, except pursuant to existing Company stock option plans. The Company does not have
pending before the Commission any request for confidential treatment of information. Except for the issuance of the Securities
contemplated by this Agreement or as set forth on Schedule 3.1(i), no event, liability, fact, circumstance, occurrence or
development has occurred or exists or is reasonably expected to occur or exist with respect to the Company or its Subsidiaries or their respective
businesses, 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 at least 1 Trading
Day prior to the date that this representation is made.
(j) Litigation.
Except as set forth on Schedule 3.1(j), there is no action, suit, inquiry, notice of violation, proceeding or investigation
pending or, to the knowledge of the Company, threatened against or affecting the Company, any Subsidiary or any of their respective
properties before or by any court, arbitrator, governmental or administrative agency or regulatory authority (federal, state,
county, local or foreign) (collectively, an “Action”). None of the Actions set forth on Schedule 3.1(j),
(i) adversely affects or challenges the legality, validity or enforceability of any of the Transaction Documents or the Securities
or (ii) could, if there were an unfavorable decision, have or reasonably be expected to result in a Material Adverse Effect. Neither
the Company nor any Subsidiary, nor any director or officer thereof, is or has been the subject of any Action involving a claim of
violation of or liability under federal or state securities laws or a claim of breach of fiduciary duty. There has not been, and to
the knowledge of the Company, there is not pending or contemplated, any investigation by the Commission involving the Company or any
current or former director or officer of the Company. The Commission has not issued any stop order or other order suspending the
effectiveness of any registration statement filed by the Company or any Subsidiary under the Exchange Act or the Securities Act.
(k) Labor
Relations. No labor dispute exists or, to the knowledge of the Company, is imminent with respect to any of the employees of the Company,
which could reasonably be expected to result in a Material Adverse Effect. None of the Company’s or its Subsidiaries’ employees
is a member of a union that relates to such employee’s relationship with the Company or such Subsidiary, and neither the Company
nor any of its Subsidiaries is a party to a collective bargaining agreement, and the Company and its Subsidiaries believe that their relationships
with their employees are good. To the knowledge of the Company, no executive officer of the Company or any Subsidiary, is, or is now expected
to be, in violation of any material term of any employment contract, confidentiality, disclosure or proprietary information agreement
or non-competition agreement, or any other contract or agreement or any restrictive covenant in favor of any third party, and the continued
employment of each such executive officer does not subject the Company or any of its Subsidiaries to any liability with respect to any
of the foregoing matters. The Company and its Subsidiaries are in compliance with all U.S. federal, state, local and foreign laws and
regulations relating to employment and employment practices, terms and conditions of employment and wages and hours, except where the
failure to be in compliance could not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.
(l) Compliance.
Neither the Company nor any Subsidiary: (i) is in default under or in violation of (and no event has occurred that has not been
waived that, with notice or lapse of time or both, would result in a default by the Company or any Subsidiary under), nor has the
Company or any Subsidiary received notice of a claim that it is in default under or that it is in violation of, any indenture, loan
or credit agreement or any other agreement or instrument to which it is a party or by which it or any of its properties is bound
(whether or not such default or violation has been waived), (ii) is in violation of any judgment, decree or order of any court,
arbitrator or other governmental authority or (iii) is or has been in violation of any statute, rule, ordinance or regulation of any
governmental authority, including without limitation all foreign, federal, state and local laws relating to taxes, environmental
protection, occupational health and safety, product quality and safety and employment and labor matters, except in each case as
could not have or reasonably be expected to result in a Material Adverse Effect.
(m) 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 could 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. The Company and the Subsidiaries have, or have rights to use, all patents, patent applications, trademarks, trademark
applications, service marks, trade names, trade secrets, inventions, copyrights, licenses and other intellectual property rights and
similar rights necessary or required for use in connection with their respective businesses as described in the SEC Reports and
which the failure to so have could have a Material Adverse Effect (collectively, the “Intellectual Property
Rights”). None of, and neither the Company nor any Subsidiary has received a notice (written or otherwise) that any of,
the Intellectual Property Rights has expired, terminated or been abandoned, or is expected to expire or terminate or be abandoned,
within two (2) years from the date of this Agreement. Neither the Company nor any Subsidiary has received, since the date of the
latest audited financial statements included within the SEC Reports, a written notice of a claim or otherwise has any knowledge that
the Intellectual Property Rights violate or infringe upon the rights of any Person, except as could not have or reasonably be
expected to not have a Material Adverse Effect. To the knowledge of the Company, all such Intellectual Property Rights are
enforceable and there is no existing infringement by another Person of any of the Intellectual Property Rights. The Company and its
Subsidiaries have taken reasonable security measures to protect the secrecy, confidentiality and value of all of their intellectual
properties, except where failure to do so could not, individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect.
(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 on Schedule 3.1(r), none of the officers or directors of the Company
or any Subsidiary and, to the knowledge of the Company, none of the employees of the Company or any Subsidiary is presently a party
to any transaction with the Company or any Subsidiary (other than for services as employees, officers and directors), including any
contract, agreement or other arrangement providing for the furnishing of services to or by, providing for rental of real or personal
property to or from providing for the borrowing of money from or lending of money to, or otherwise requiring payments to or from any
officer, director or such employee or, to the knowledge of the Company, any entity in which any officer, director, or any such
employee has a substantial interest or is an officer, director, trustee, stockholder, member or partner, in each case in excess of
$120,000 other than for (i) payment of salary or consulting fees for services rendered, (ii) reimbursement for expenses incurred on
behalf of the Company and (iii) other employee benefits, including stock option agreements under any stock option plan of the
Company.
(s) Sarbanes-Oxley;
Internal Accounting Controls. The Company and the Subsidiaries are in compliance with any and all applicable requirements of the
Sarbanes-Oxley Act of 2002, 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. 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) Listing
and Maintenance Requirements. The Common Stock is registered pursuant to Section 12(b) or 12(g) of the Exchange Act, and the
Company has taken no action designed to, or which to its knowledge is likely to have the effect of, terminating the registration of
the Common Stock under the Exchange Act nor has the Company received any notification that the Commission is contemplating
terminating such registration. The Company has not, in the 12 months preceding the date hereof, received notice from any Trading
Market on which the Common Stock is or has been listed or quoted to the effect that the Company is not in compliance with the
listing or maintenance requirements of such Trading Market. The Company is, and has no reason to believe that it will not in the
foreseeable future continue to be, in compliance with all such listing and maintenance requirements. 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.
(x) Application
of Takeover Protections. The Company and the Board of Directors have taken all necessary action, if any, in order to render
inapplicable any control share acquisition, business combination, poison pill (including any distribution under a rights agreement)
or other similar anti-takeover provision under the Company’s certificate of incorporation (or similar charter documents) or
the laws of its state of incorporation that is or could become applicable to the Purchasers as a result of the Purchasers and the
Company fulfilling their obligations or exercising their rights under the Transaction Documents, including without limitation as a
result of the Company’s issuance of the Securities and the Purchasers’ ownership of the Securities.
(y) Disclosure.
Except with respect to the material terms and conditions of the transactions contemplated by the Transaction Documents, the Company
confirms that neither it nor any other Person acting on its behalf has provided any of the Purchasers or their agents or counsel
with any information that it believes constitutes or might constitute material, non-public information. The Company understands and
confirms that the Purchasers will rely on the foregoing representation in effecting transactions in securities of the Company. All
of the disclosure furnished by or on behalf of the Company to the Purchasers regarding the Company and its Subsidiaries, their
respective businesses and the transactions contemplated hereby, including the Disclosure Schedules to this Agreement, is true and
correct and does not contain any untrue statement of a material fact or omit to state any material fact necessary in order to make
the statements made therein, in the light of the circumstances under which they were made, not misleading. The press releases disseminated by the Company during the
twelve months preceding the date of this Agreement taken as a whole do not contain any untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary in order to make the statements therein, in 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.
(ab) 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, after
taking into account all anticipated uses of the cash, would be sufficient to pay all amounts on or in respect of its liabilities when
such amounts are required to be paid. The Company does not intend to incur debts beyond its ability to pay such debts as they mature
(taking into account the timing and amounts of cash to be payable on or in respect of its debt). The Company has no knowledge of any
facts or circumstances which lead it to believe that it will file for reorganization or liquidation under the bankruptcy or reorganization
laws of any jurisdiction within one year from the Closing Date. Schedule 3.1(bb) sets forth as of the date hereof all outstanding
secured and unsecured Indebtedness of the Company or any Subsidiary, or for which the Company or any Subsidiary has commitments. For
the purposes of this Agreement, “Indebtedness” means (x) any liabilities for borrowed money or amounts owed in excess
of $100,000 (other than trade accounts payable incurred in the ordinary course of business), (y) all guaranties, endorsements and other
contingent obligations in respect of indebtedness of others, whether or not the same are or should be reflected in the Company’s
consolidated balance sheet (or the notes thereto), except guaranties by endorsement of negotiable instruments for deposit or collection
or similar transactions in the ordinary course of business; and (z) the present value of any lease payments in excess of $100,000 due
under leases required to be capitalized in accordance with GAAP. Neither the Company nor any Subsidiary is in default with respect to
any Indebtedness.
(ac) 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.
(ad) 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.
(ae) 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.
(af) Accountants.
The Company’s accounting firm is set forth on Schedule 3.1(ff) of the Disclosure Schedules. To the knowledge and belief of
the Company, such accounting firm (i) is a registered public accounting firm as required by the Exchange Act and (ii) shall express its
opinion with respect to the financial statements to be included in the Company’s Annual Report for the fiscal year ended December
31, 2022 and period ended June 30, 2023.
(ag) Seniority.
As of the Closing Date, no Indebtedness or other claim against the Company is senior to the Debentures in right of payment, 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).
(ah) 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.
(ai) 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.
(aj) Acknowledgment
Regarding Purchaser’s Trading Activity. Anything in this Agreement or elsewhere herein to the contrary notwithstanding (except
for Sections 3.2(g) and 4.15 hereof), it is understood and acknowledged by the Company that: (i) none of the Purchasers has been asked
by the Company to agree, nor has any Purchaser agreed, to desist from purchasing or selling, long and/or short, securities of the Company,
or “derivative” securities based on securities issued by the Company or to hold the Securities for any specified term, (ii)
past or future open market or other transactions by any Purchaser, specifically including, without limitation, Short Sales or “derivative”
transactions, before or after the closing of this or future private placement transactions, may negatively impact the market price of
the Company’s publicly-traded securities, (iii) any Purchaser, and counter-parties in “derivative” transactions to which
any such Purchaser is a party, directly or indirectly, may presently have a “short” position in the Common Stock and (iv)
each Purchaser shall not be deemed to have any affiliation with or control over any arm’s length counter-party in any “derivative”
transaction. The Company further understands and acknowledges that (y) one or more Purchasers may engage in hedging activities at various
times during the period that the Securities are outstanding, including, without limitation, during the periods that the value of the Underlying
Shares deliverable with respect to Securities are being determined, and (z) such hedging activities (if any) could reduce the value of
the existing stockholders’ equity interests in the Company at and after the time that the hedging activities are being conducted. The
Company acknowledges that such aforementioned hedging activities do not constitute a breach of any of the Transaction Documents.
(ak) 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.
(al) Stock Option
Plans. Each stock option granted by the Company under the Company’s stock option plan was granted (i) in accordance with the
terms of the Company’s stock option plan and (ii) with an exercise price at least equal to the fair market value of the Common Stock
on the date such stock option would be considered granted under GAAP and applicable law. No stock option granted under the Company’s
stock option plan has been backdated. The Company has not knowingly granted, and there is no and has been no Company policy or practice
to knowingly grant, stock options prior to, or otherwise knowingly coordinate the grant of stock options with, the release or other public
announcement of material information regarding the Company or its Subsidiaries or their financial results or prospects.
(am) Cybersecurity.
(i)(x) There has been no security breach or other compromise of or relating to any of the Company’s or any Subsidiary’s information
technology and computer systems, networks, hardware, software, data (including the data of its respective customers, employees, suppliers,
vendors and any third party data maintained by or on behalf of it), equipment or technology (collectively, “IT Systems and Data”)
and (y) the Company and the Subsidiaries have not been notified of, and has no knowledge of any event or condition that would reasonably
be expected to result in, any security breach or other compromise to its IT Systems and Data; (ii) the Company and the Subsidiaries are
presently in compliance with all applicable laws or statutes and all judgments, orders, rules and regulations of any court or arbitrator
or governmental or regulatory authority, internal policies and contractual obligations relating to the privacy and security of IT Systems
and Data and to the protection of such IT Systems and Data from unauthorized use, access, misappropriation or modification, except as
would not, individually or in the aggregate, have a Material Adverse Effect; (iii) the Company and the Subsidiaries have implemented and
maintained commercially reasonable safeguards to maintain and protect its material confidential information and the integrity, continuous
operation, redundancy and security of all IT Systems and Data; and (iv) the Company and the Subsidiaries have implemented backup and disaster
recovery technology consistent with industry standards and practices.
(an) 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”).
(ao) 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.
(ap) 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.
(aq) 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.
(ar) 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.
(as) 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.
(at) 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.
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 and (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 the Registration Statement or otherwise in compliance with applicable
federal and state securities laws). Such Purchaser is acquiring the Securities hereunder in the ordinary course of its business.
(c) Purchaser
Status. At the time such Purchaser was offered the Securities, it was, and as of the date hereof it is, and on each date on
which it exercises any Warrants or converts any Debentures it will be 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 the following
form:
[NEITHER]
THIS SECURITY [NOR THE SECURITIES INTO WHICH THIS SECURITY IS [EXERCISABLE] [CONVERTIBLE]] HAS [NOT] BEEN REGISTERED WITH THE
SECURITIES AND EXCHANGE COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE IN RELIANCE UPON AN EXEMPTION FROM REGISTRATION UNDER
THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT
PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A
TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND IN ACCORDANCE WITH APPLICABLE STATE SECURITIES
LAWS. THIS SECURITY [AND THE SECURITIES ISSUABLE UPON [EXERCISE] [CONVERSION] OF THIS SECURITY] MAY BE PLEDGED IN CONNECTION WITH A
BONA FIDE MARGIN ACCOUNT WITH A REGISTERED BROKER-DEALER OR OTHER LOAN WITH A FINANCIAL INSTITUTION THAT IS AN “ACCREDITED
INVESTOR” AS DEFINED IN RULE 501(a) UNDER THE SECURITIES ACT OR OTHER LOAN SECURED BY SUCH SECURITIES.
The Company acknowledges
and agrees that a Purchaser may from time to time pledge pursuant to a bona fide margin agreement with a registered broker-dealer or grant
a security interest in some or all of the Securities to a financial institution that is an “accredited investor” as defined
in Rule 501(a) under the Securities Act and, 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.
(c)
Certificates evidencing the Underlying Shares shall not contain any legend (including the legend set forth in Section 4.1(b)
hereof): (i) while a registration statement (including the Registration Statement) covering the resale of such security is effective
under the Securities Act, (ii) following any sale of such Underlying Shares pursuant to Rule 144 (assuming cashless exercise of the
Warrants), (iii) if such Underlying Shares are eligible for sale under Rule 144 (assuming cashless exercise of the Warrants), 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 the Effective Date if required by the Transfer Agent to effect the removal of the legend
hereunder, or if requested by a Purchaser, respectively. If all or any portion of a Debenture is converted or Warrant is exercised
at a time when there is an effective registration statement to cover the resale of the Underlying Shares, or if such Underlying
Shares may be sold under Rule 144 or if such legend is not otherwise required under applicable requirements of the Securities Act
(including judicial interpretations and pronouncements issued by the staff of the Commission) then such Underlying Shares shall be
issued free of all legends. The Company agrees that following the Effective Date or 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) two (2) Trading Days and (ii) the number of Trading
Days comprising the Standard Settlement Period (as defined below) following the delivery by a Purchaser to the Company or the
Transfer Agent of a certificate representing Underlying Shares, as applicable, issued with a restrictive legend (such 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 Underlying Shares subject
to legend removal hereunder shall be transmitted by the Transfer Agent to the Purchaser by crediting the account of the
Purchaser’s prime broker with the Depository Trust Company System as directed by such Purchaser. 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 Underlying 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 Underlying Shares (based on the VWAP of the Common Stock on the date such Securities are
submitted to the Transfer Agent) delivered for removal of the restrictive legend and subject to Section 4.1(c), $10 per Trading Day
(increasing to $20 per Trading Day five (5) Trading Days after the Legend Removal Date) for each Trading Day after the Legend
Removal Date until such certificate is delivered without a legend 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) (the “Buy-In Price”) over the product of (A) such number of Underlying 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
Underlying 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 Underlying Shares pursuant to the Transaction Documents,
are unconditional and absolute and not subject to any right of set off, counterclaim, delay or reduction, regardless of the effect of
any such dilution or any claim the Company may have against any Purchaser and regardless of the dilutive effect that such issuance may
have on the ownership of the other stockholders of the Company.
4.3 Furnishing of Information; Public Information.
(a) Until
the earlier of the time that (i) no Purchaser owns Securities or (ii) the Warrants have expired, the Company covenants to maintain the
registration of the Common Stock under Section 12(b) or 12(g) of the Exchange Act and to timely file (or obtain extensions in respect
thereof and file within the applicable grace period) all reports required to be filed by the Company after the date hereof pursuant to
the Exchange Act even if the Company is not then subject to the reporting requirements of the Exchange Act.
(b) At any
time during the period commencing from the six (6) month anniversary of the date hereof and ending at such time that all of the
Securities may be sold without the requirement for the Company to be in compliance with Rule 144(c)(1) and otherwise without
restriction or limitation pursuant to Rule 144, if the Company (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 day of a Public Information Failure and on every thirtieth (30th) day (pro rated for periods totaling less than thirty days)
thereafter until the earlier of (a) the date such Public Information Failure is cured and (b) such time that such public information
is no longer required for the Purchasers to transfer the Underlying Shares pursuant to Rule 144. The payments to which a Purchaser
shall be entitled pursuant to this Section 4.3(b) are referred to herein as “Public Information Failure
Payments.” Public Information Failure Payments shall be paid on the earlier of (i) the last day of the calendar month
during which such Public Information Failure Payments are incurred and (ii) the third (3rd) Business Day after the event or failure
giving rise to the Public Information Failure Payments is cured. In the event the Company fails to make Public Information Failure
Payments in a timely manner, such Public Information Failure Payments shall bear interest at the rate of 1.5% per month (prorated
for partial months) until paid in full. Nothing herein shall limit such Purchaser’s right to pursue actual damages for the
Public Information Failure, and such Purchaser shall have the right to pursue all remedies available to it at law or in equity
including, without limitation, a decree of specific performance and/or injunctive relief.
4.4 Integration.
The Company shall not sell, offer for sale or solicit offers to buy or otherwise negotiate in respect of any security (as defined in Section
2 of the Securities Act) that would be integrated with the offer or sale of the Securities in a manner that would require the registration
under the Securities Act of the sale of the Securities or that would be integrated with the offer or sale of the Securities for purposes
of the rules and regulations of any Trading Market such that it would require shareholder approval prior to the closing of such other
transaction unless shareholder approval is obtained before the closing of such subsequent transaction.
4.5 Conversion
and Exercise Procedures. Each of the form of Notice of Exercise included in the Warrants and the form of Notice of Conversion included
in the Debentures set forth the totality of the procedures required of the Purchasers in order to exercise the Warrants or convert the
Debentures. Without limiting the preceding sentences, no ink-original Notice of Exercise or Notice of Conversion shall be required, nor
shall any medallion guarantee (or other type of guarantee or notarization) of any Notice of Exercise or Notice of Conversion form be required
in order to exercise the Warrants or convert the Debentures. No additional legal opinion, other information or instructions shall be required
of the Purchasers to exercise their Warrants or convert their Debentures. The Company shall honor exercises of the Warrants and conversions
of the Debentures and shall deliver Underlying Shares in accordance with the terms, conditions and time periods set forth in the Transaction
Documents.
4.6 Securities Laws Disclosure;
Publicity. The Company shall (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 , and any of the Purchasers or any of their Affiliates on the other hand, 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 in connection with the filing of final Transaction Documents with the Commission and (b) to the extent
such disclosure is required by law or Trading Market regulations, in which case the Company shall provide the Purchasers with prior
notice of such disclosure permitted under this clause (b) and reasonably cooperate with such Purchaser regarding such
disclosure.
4.7 Shareholder
Rights Plan. No claim will be made or enforced by the Company or, with the consent of the Company, any other Person, that any Purchaser
is an “Acquiring Person” under any control share acquisition, business combination, poison pill (including any distribution
under a rights agreement) or similar anti-takeover plan or arrangement in effect or hereafter adopted by the Company, or that any Purchaser
could be deemed to trigger the provisions of any such plan or arrangement, by virtue of receiving Securities under the Transaction Documents
or under any other agreement between the Company and the Purchasers.
4.8 Non-Public
Information. Except with respect to the material terms and conditions of the transactions contemplated by the Transaction Documents,
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, 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.
4.9 Use of
Proceeds. Except as set forth on Schedule 4.9 attached hereto, the Company shall use the net proceeds from the sale of
the Securities hereunder for working capital purposes and shall not use such proceeds: (a) for the satisfaction of any portion of
the Company’s debt (other than payment of trade payables in the ordinary course of the Company’s business and prior
practices), (b) for the redemption of any Common Stock or Common Stock Equivalents, (c) for the settlement of any outstanding
litigation or (d) in violation of FCPA or OFAC regulations.
4.10 Indemnification
of Purchasers. Subject to the provisions of this Section 4.10, the Company will indemnify and hold each Purchaser and its directors,
officers, shareholders, members, partners, employees and agents (and any other Persons with a functionally equivalent role of a Person
holding such titles notwithstanding a lack of such title or any other title), each Person who controls such Purchaser (within the meaning
of Section 15 of the Securities Act and Section 20 of the Exchange Act), and the directors, officers, shareholders, agents, members, partners
or employees (and any other Persons with a functionally equivalent role of a Person holding such titles notwithstanding a lack of such
title or any other title) of such controlling persons (each, a “Purchaser Party”) harmless from any and all losses, liabilities,
obligations, claims, contingencies, damages, costs and expenses, including all judgments, amounts paid in settlements, court costs and
reasonable attorneys’ fees and costs of investigation that any such Purchaser Party may suffer or incur as a result of or relating
to (a) any breach of any of the representations, warranties, covenants or agreements made by the Company in this Agreement or in the other
Transaction Documents or (b) any action instituted against the Purchaser Parties in any capacity, or any of them or their respective Affiliates,
by any stockholder of the Company who is not an Affiliate of such Purchaser Party, with respect to any of the transactions contemplated
by the Transaction Documents (unless such action is solely based upon a material breach of such Purchaser Party’s representations,
warranties or covenants under the Transaction Documents or any agreements or understandings such Purchaser Party may have with any such
stockholder or any violations by such Purchaser Party of state or federal securities laws or any conduct by such Purchaser Party which
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, the Company shall have the right to assume the defense thereof with counsel of its own choosing reasonably acceptable
to the Purchaser Party. Any Purchaser Party shall have the right to employ separate counsel in any such action and participate in the
defense thereof, but the fees and expenses of such counsel shall be at the expense of such Purchaser Party except to the extent that (i)
the employment thereof has been specifically authorized by the Company in writing, (ii) the Company has failed after a reasonable period
of time to assume such defense and to employ counsel or (iii) in such action there is, in the reasonable opinion of counsel a material
conflict on any material issue between the position of the Company and the position of such Purchaser Party, in which case the Company
shall be responsible for the reasonable fees and expenses of no more than one such separate counsel. The Company will not be liable to
any Purchaser Party under this Agreement (y) for any settlement by a Purchaser Party effected without the Company’s prior written
consent, which shall not be unreasonably withheld or delayed; or (z) to the extent, but only to the extent that a loss, claim, damage
or liability is attributable to any Purchaser Party’s breach of any of the representations, other Transaction Documents. The indemnification
required by this Section 4.10 shall be made by periodic payments of the amount thereof during the course of the investigation or defense,
as and when bills are received or are incurred. The indemnity agreements contained herein shall be in addition to any cause of action
or similar right of any Purchaser Party against the Company or others and any liabilities the Company may be subject to pursuant to law.
4.11 Reservation and Listing of Securities.
(a) The
Company shall maintain a reserve 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 commercially reasonable efforts to amend the Company’s certificate or articles
of incorporation to increase the number of authorized but unissued shares of Common Stock to at least the Required Minimum at such time,
as soon as possible and in any event not later than the 75th day after such date.
(c) The
Company shall, if applicable: (i) in the time and manner required by the principal Trading Market, prepare and file with such Trading
Market an additional shares listing application covering a number of shares of Common Stock at least equal to the Required Minimum on
the date of such application, (ii) take all steps necessary to cause such shares of Common Stock to be approved for listing or quotation
on such Trading Market as soon as possible thereafter, (iii) provide to the Purchasers evidence of such listing or quotation and (iv)
maintain the listing or quotation of such Common Stock on any date at least equal to the Required Minimum on such date on such Trading
Market or another Trading Market. 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. In addition, the
Company shall hold a special meeting of shareholders (which may also be at the annual meeting of shareholders) at the earlier of the date
of the Company’s annual shareholder meeting and the sixty (60) day anniversary of this Agreement for the purpose of obtaining Shareholder
Approval, with the recommendation of the Company’s Board of Directors that such proposal be approved, and the Company shall solicit
proxies from its shareholders in connection therewith in the same manner as all other management proposals in such proxy statement and
all management-appointed proxyholders shall vote their proxies in favor of such proposal. The Company shall use its reasonable best efforts
to obtain such Shareholder Approval. If the Company does not obtain Shareholder Approval at the first meeting, the Company shall call
a meeting every four months thereafter to seek Shareholder Approval until the earlier of the date Shareholder Approval.
4.12 Equal
Treatment of Purchasers. No consideration (including any modification of any Transaction Document) shall be offered or paid to
any Person to amend or consent to a waiver or modification of any provision of the Transaction Documents unless the same
consideration is also offered to all of the parties to such Transaction Documents. Further, the Company shall not make any payment
of principal or interest on the Debentures in amounts which are disproportionate to the respective principal amounts outstanding on
the Debentures 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.
4.13 Certain
Transactions and Confidentiality. Each Purchaser, severally and not jointly with the other Purchasers, covenants that neither it,
nor any Affiliate acting on its behalf or pursuant to any understanding with it will execute any purchases or sales, including Short Sales,
of any of the Company’s securities during the period commencing with the execution of this Agreement and ending at such time that
the transactions contemplated by this Agreement are first publicly announced pursuant to the initial press release as described in Section
4.6. Each Purchaser, severally and not jointly with the other Purchasers, covenants that until such time as the transactions contemplated
by this Agreement are publicly disclosed by the Company pursuant to the initial press release as described in Section 4.6, such Purchaser
will maintain the confidentiality of the existence and terms of this transaction and the information included in the Disclosure Schedules
(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.
4.14 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.
4.15 Capital
Changes. Until the one year anniversary of the Effective Date, the Company shall not undertake a reverse or forward stock split
or reclassification of the Common Stock without the prior written consent of the Purchasers holding a majority in principal amount
outstanding of the Debentures, except as may be required to meet any exchange requirement for continued listing.
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 Representation.
Except as expressly set forth in the Transaction Documents to the contrary, each party shall pay the fees and expenses of its advisers,
counsel, accountants and other experts, if any, and all other expenses incurred by such party incident to the negotiation, preparation,
execution, delivery and performance of this Agreement. The Company shall pay all Transfer Agent fees (including, without limitation, any
fees required for same-day processing of any instruction letter delivered by the Company and any conversion or exercise notice delivered
by a Purchaser), stamp taxes and other taxes and duties levied in connection with the delivery of any Securities to the Purchasers.
5.3 Entire
Agreement. The Transaction Documents, together with the exhibits and schedules thereto, contain the entire understanding of the parties
with respect to the subject matter hereof and thereof and supersede all prior agreements and understandings, oral or written, with respect
to such matters, which the parties acknowledge have been merged into such documents, exhibits and schedules.
5.4 Notices.
Any and all notices or other communications or deliveries required or permitted to be provided hereunder shall be in writing and shall
be deemed given and effective on the earliest of: (a) the time of transmission, if such notice or communication is delivered via 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 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 Purchasers which purchased at least 50.01% in interest of the Debentures based on the initial
Subscription Amounts hereunder (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 proposed amendment or waiver that disproportionately, materially and adversely affects the rights and obligations of any Purchaser
relative to the comparable rights and obligations of the other Purchasers shall require the prior written consent of such adversely affected
Purchaser. 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 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 “.pdf” signature page were an original thereof.
5.12 Severability.
If any term, provision, covenant or restriction of this Agreement is held by a court of competent jurisdiction to be invalid, illegal,
void or unenforceable, the remainder of the terms, provisions, covenants and restrictions set forth herein shall remain in full force
and effect and shall in no way be affected, impaired or invalidated, and the parties hereto shall use their commercially reasonable efforts
to find and employ an alternative means to achieve the same or substantially the same result as that contemplated by such term, provision,
covenant or restriction. It is hereby stipulated and declared to be the intention of the parties that they would have executed the remaining
terms, provisions, covenants and restrictions without including any of such that may be hereafter declared invalid, illegal, void or unenforceable.
5.13 Rescission and
Withdrawal Right. Notwithstanding anything to the contrary contained in (and without limiting any similar provisions of) any of
the other Transaction Documents, whenever any Purchaser exercises a right, election, demand or option under a Transaction Document
and the Company does not timely perform its related obligations within the periods therein provided, then such Purchaser may rescind
or withdraw, in its sole discretion from time to time upon written notice to the Company, any relevant notice, demand or election in
whole or in part without prejudice to its future actions and rights; provided, however, that, in the case of a
rescission of a conversion of a Debenture or exercise of a Warrant, the applicable Purchaser shall be required to return any shares
of Common Stock subject to any such rescinded conversion or exercise notice concurrently with the return to such Purchaser of the
aggregate exercise price paid to the Company for such shares and the restoration of such Purchaser’s right to acquire such
shares pursuant to such Purchaser’s Warrant (including, issuance of a replacement warrant certificate evidencing such restored
right).
5.14 Replacement
of Securities. If any certificate or instrument evidencing any Securities is mutilated, lost, stolen or destroyed, the Company shall
issue or cause to be issued in exchange and substitution for and upon cancellation thereof (in the case of mutilation), or in lieu of
and substitution therefor, a new certificate or instrument, but only upon receipt of evidence reasonably satisfactory to the Company of
such loss, theft or destruction. The applicant for a new certificate or instrument under such circumstances shall also pay any reasonable
third-party costs (including customary indemnity) associated with the issuance of such replacement Securities.
5.15 Remedies.
In addition to being entitled to exercise all rights provided herein or granted by law, including recovery of damages, each of the Purchasers
and the Company will be entitled to specific performance under the Transaction Documents. The parties agree that monetary damages may
not be adequate compensation for any loss incurred by reason of any breach of obligations contained in the Transaction Documents and hereby
agree to waive and not to assert in any Action for specific performance of any such obligation the defense that a remedy at law would
be adequate.
5.16 Payment
Set Aside. To the extent that the Company makes a payment or payments to any Purchaser pursuant to any Transaction Document or a Purchaser
enforces or exercises its rights thereunder, and such payment or payments or the proceeds of such enforcement or exercise or any part
thereof are subsequently invalidated, declared to be fraudulent or preferential, set aside, recovered from, disgorged by or are required
to be refunded, repaid or otherwise restored to the Company, a trustee, receiver or any other Person under any law (including, without
limitation, any bankruptcy law, state or federal law, common law or equitable cause of action), then to the extent of any such restoration
the obligation or part thereof originally intended to be satisfied shall be revived and continued in full force and effect as if such
payment had not been made or such enforcement or setoff had not occurred.
5.17 Usury. To
the extent it may lawfully do so, the Company hereby agrees not to insist upon or plead or in any manner whatsoever claim, and will
resist any and all efforts to be compelled to take the benefit or advantage of, usury laws wherever enacted, now or at any time
hereafter in force, in connection with any 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. For
reasons of administrative convenience only, each Purchaser and its respective counsel have chosen to communicate with the Company through
EGS. EGS does not represent any of the Purchasers other than the Lead Purchaser. 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.
WETRADE GROUP INC. |
Address for Notice: |
By: |
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Email: |
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Name: |
Wei He Chun |
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Title: |
CEO |
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With a copy to (which shall not constitute notice): |
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[REMAINDER OF PAGE INTENTIONALLY
LEFT BLANK
SIGNATURE PAGE FOR PURCHASER FOLLOWS]
SCHEDULE A
[PURCHASER SIGNATURE PAGES TO WETG 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):
Subscription Amount: $ |
(at 30% discount) Purchases |
Amount:
$
Warrant Shares: |
shares |
Beneficial Ownership Blocker
o 4.99% or o 9.99% |
EIN Number:___________________
[SIGNATURE PAGES CONTINUE]
Annex A
CLOSING STATEMENT
Pursuant to the attached Securities
Purchase Agreement, dated as of the date hereto, the purchasers shall purchase up to $ of Principal Amount of Debentures and Warrants
from WeTrade Group Inc., a Wyoming corporation (the “Company”). All funds will be wired into an account maintained
by the Company. All funds will be disbursed in accordance with this Closing Statement.
Disbursement Date: August , 2023
Gross Proceeds to be Received |
$ |
30% Discount |
$ |
|
$ |
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$ |
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$ |
|
$ |
Total Amount Disbursed: |
$ |
WIRE INSTRUCTIONS:
Please see attached.
Acknowledged and agreed to
this 21st day of August,
2023
WETRADE GROUP INC. |
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By: |
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Name: |
Wei Hechun |
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Title: |
CEO |
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42
EXHIBIT 10.2
EXHIBIT A
NEITHER THIS SECURITY NOR THE SECURITIES
FOR WHICH THIS SECURITY IS EXERCISABLE HAVE BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION OR THE SECURITIES COMMISSION OF
ANY STATE IN RELIANCE UPON AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”),
AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR PURSUANT
TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND IN ACCORDANCE
WITH APPLICABLE STATE SECURITIES LAWS. THIS SECURITY AND THE SECURITIES ISSUABLE UPON EXERCISE OF THIS SECURITY MAY BE PLEDGED IN CONNECTION
WITH A BONA FIDE MARGIN ACCOUNT OR OTHER LOAN SECURED BY SUCH SECURITIES.
COMMON STOCK PURCHASE
WARRANT WETRADE GROUP INC.
Warrant Shares1: |
Initial Exercise Date: August , 2023 |
THIS COMMON
STOCK PURCHASE WARRANT (the “Warrant”) certifies that, for value received, or its assigns (the “Holder”)
is entitled, upon the terms and subject to the limitations on exercise and the conditions hereinafter set forth, at any time on or after
the date hereof (the “Initial Exercise Date”) and on or prior to 5:00 p.m. (New York City time) on August , 20282
(the “Termination Date”) but not thereafter, to subscribe for and purchase from WeTrade Group Inc., a Wyoming corporation
(the “Company”), up to shares (as subject to adjustment hereunder, the “Warrant Shares”) of Common
Stock. The purchase price of one share of Common Stock under this Warrant shall be equal to the Exercise Price, as defined in Section
2(b).
Section
1. Definitions. Capitalized terms used and not otherwise defined herein shall have the meanings set forth in that certain Share
Purchase Agreement (the “Purchase Agreement”), dated August 15, 2023, among the Company and the purchasers signatory
thereto.
| 1 | 100% of the Conversion Shares issuable upon conversion of the
Note at the time of issuance of the Note. |
| 2 | Insert the date that is the 5 year anniversary of the Initial
Exercise Date, provided that, if such date is not a Trading Day, insert the immediately following Trading Day. |
Section 2. Exercise.
a) Exercise
of Warrant. Exercise of the purchase rights represented by this Warrant may be made, in whole or in part, at any time or times
on or after the Initial Exercise Date and on or before the Termination Date by delivery to the Company of a duly executed PDF copy
submitted by e-mail (or e-mail attachment) of the Notice of Exercise in the form annexed hereto (the “Notice of
Exercise”). Within the earlier of (i) two (2) Trading Days and (ii) the number of Trading Days comprising the Standard
Settlement Period (as defined in Section 2(d)(i) herein) following the date of exercise as aforesaid, the Holder shall deliver the
aggregate Exercise Price for the shares specified in the applicable Notice of Exercise by wire transfer or cashier’s check
drawn on a United States bank unless the cashless exercise procedure specified in Section 2(c) below is specified in the applicable
Notice of Exercise. No ink-original Notice of Exercise shall be required, nor shall any medallion guarantee (or other type of
guarantee or notarization) of any Notice of Exercise be required. Notwithstanding anything herein to the contrary, the Holder shall
not be required to physically surrender this Warrant to the Company until the Holder has purchased all of the Warrant Shares
available hereunder and the Warrant has been exercised in full, in which case, the Holder shall surrender this Warrant to the
Company for cancellation as soon as reasonably practicable of the date on which the final Notice of Exercise is delivered to the
Company. Partial exercises of this Warrant resulting in purchases of a portion of the total number of Warrant Shares available
hereunder shall have the effect of lowering the outstanding number of Warrant Shares purchasable hereunder in an amount equal to the
applicable number of Warrant Shares purchased. The Holder and the Company shall maintain records showing the number of Warrant
Shares purchased and the date of such purchases. The Company shall deliver any objection to any Notice of Exercise within two (2)
Business Day of receipt of such notice. The Holder and any assignee, by acceptance of this Warrant, acknowledge and agree that,
by reason of the provisions of this paragraph, following the purchase of a portion of the Warrant Shares hereunder, the number of
Warrant Shares available for purchase hereunder at any given time may be less than the amount stated on the face hereof.
b) Exercise
Price. The exercise price per share of Common Stock under this Warrant shall be $4.76, or 60% of the closing market price of the Company’s
Common Shares on August 14, 2023, subject to adjustment hereunder (the “Exercise Price”).
c) Cashless
Exercise. If at the time of exercise hereof there is no effective registration statement registering, or the prospectus contained
therein is not available for the resale of the Warrant Shares by the Holder, then this Warrant may also be exercised, in whole or in part,
at such time by means of a “cashless exercise” in which the Holder shall be entitled to receive a number of Warrant Shares
equal to the quotient obtained by dividing [(A-B) (X)] by (A), where:
|
(A) |
= |
as applicable: (i) the closing bid price on the Trading Day immediately preceding the date of the applicable Notice of Exercise as reported by Bloomberg L.P. (“Bloomberg”); |
|
|
|
|
|
(B) |
= |
the Exercise Price of this Warrant, as adjusted hereunder; and |
|
|
|
|
|
(X) |
= |
the number of Warrant Shares that would be issuable upon exercise of this Warrant in accordance with the terms of this Warrant if such exercise were by means of a cash exercise rather than a cashless exercise. |
If
Warrant Shares are issued in such a cashless exercise, the parties acknowledge and agree that in accordance with Section 3(a)(9) of
the Securities Act, the holding period of the Warrant Shares being issued may be tacked on to the holding period of this Warrant.
The Company agrees not to take any position contrary to this Section 2(c).
“Bid Price” 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 bid price of the Common Stock for the time in question (or the nearest preceding date) on the Trading Market on which
the Common Stock is then listed or quoted as reported by Bloomberg (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 Purchasers of a majority in interest of the Securities then outstanding and reasonably acceptable to
the Company, the fees and expenses of which shall be paid by the Company.
Notwithstanding
anything herein to the contrary, on the Termination Date, this Warrant shall be automatically exercised via cashless exercise pursuant
to this Section 2(c).
d)
Mechanics of Exercise.
i. Delivery
of Warrant Shares Upon Exercise. The Company shall cause the Warrant Shares purchased hereunder to be transmitted by the
Transfer Agent to the Holder by crediting the account of the Holder’s or its designee’s balance account with The
Depository Trust Company through its Deposit or Withdrawal at Custodian system (“DWAC”) if the Company is then a
participant in such system and either (A) there is an effective registration statement permitting the issuance of the Warrant Shares
to or resale of the Warrant Shares by the Holder or (B) the Warrant Shares are eligible for resale by the Holder without volume or
manner-of- sale limitations pursuant to Rule 144 (assuming cashless exercise of the Warrants), and otherwise by physical delivery of
a certificate, registered in the Company’s share register in the name of the Holder or its designee, for the number of Warrant
Shares to which the Holder is entitled pursuant to such exercise to the address specified by the Holder in the Notice of Exercise by
the date that is the earliest of (i) two (2) Trading Days after the delivery to the Company of the Notice of Exercise, (ii) one (1)
Trading Day after delivery of the aggregate Exercise Price to the Company and (iii) the number of Trading Days comprising the
Standard Settlement Period after the delivery to the Company of the Notice of Exercise (such date, the “Warrant Share
Delivery Date”). Upon delivery of the Notice of Exercise, the Holder shall be deemed for all corporate purposes to have
become the holder of record of the Warrant Shares with respect to which this Warrant has been exercised, irrespective of the date of
delivery of the Warrant Shares, provided that payment of the aggregate Exercise Price (other than in the case of a cashless
exercise) is received within the earlier of (i) two (2) Trading Days and (ii) the number of Trading Days comprising the Standard
Settlement Period following delivery of the Notice of Exercise. If the Company fails for any reason to deliver to the Holder the
Warrant Shares subject to a Notice of Exercise by the Warrant Share Delivery Date, the Company shall pay to the Holder, in cash, as
liquidated damages and not as a penalty, for each $1,000 of Warrant Shares subject to such exercise , $10 per Trading Day
(increasing to $20 per Trading Day on the third Trading Day after the Warrant Share Delivery Date) for each Trading Day after such
Warrant Share Delivery Date until such Warrant Shares are delivered or Holder rescinds such exercise. The Company agrees to maintain
a transfer agent that is a participant in the FAST program so long as this Warrant remains outstanding and exercisable. 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 the Notice of
Exercise.
ii. Delivery
of New Warrants Upon Exercise. If this Warrant shall have been exercised in part, the Company shall, at the request of a Holder and
upon surrender of this Warrant certificate, at the time of delivery of the Warrant Shares, deliver to the Holder a new Warrant evidencing
the rights of the Holder to purchase the unpurchased Warrant Shares called for by this Warrant, which new Warrant shall in all other respects
be identical with this Warrant.
iii. Rescission
Rights. If the Company fails to cause the Transfer Agent to transmit to the Holder the Warrant Shares pursuant to Section 2(d)(i)
by the Warrant Share Delivery Date, then the Holder will have the right to rescind such exercise.
iv. Compensation
for Buy-In on Failure to Timely Deliver Warrant Shares Upon Exercise. In addition to any other rights available to the Holder,
if the Company fails to cause the Transfer Agent to transmit to the Holder the Warrant Shares in accordance with the provisions of
Section 2(d)(i) above pursuant to an exercise on or before the Warrant Share Delivery Date, and if after such date the Holder is
required by its broker to purchase (in an open market transaction or otherwise) or the Holder’s brokerage firm otherwise
purchases, shares of Common Stock to deliver in satisfaction of a sale by the Holder of the Warrant Shares which the Holder
anticipated receiving upon such exercise (a “Buy-In”), then the Company shall (A) pay in cash to the Holder the
amount, if any, by which (x) the Holder’s total purchase price (including brokerage commissions, if any) for the shares of
Common Stock so purchased exceeds (y) the amount obtained by multiplying (1) the number of Warrant Shares that the Company was
required to deliver to the Holder in connection with the exercise at issue times (2) the price at which the sell order giving rise
to such purchase obligation was executed, and (B) at the option of the Holder, either reinstate the portion of the Warrant and
equivalent number of Warrant Shares for which such exercise was not honored (in which case such exercise shall be deemed rescinded)
or deliver to the Holder the number of shares of Common Stock that would have been issued had the Company timely complied with its
exercise and delivery obligations hereunder. For example, if the Holder purchases Common Stock having a total purchase price of
$11,000 to cover a Buy-In with respect to an attempted exercise of shares of Common Stock with an aggregate sale price giving rise
to such purchase obligation of $10,000, under clause (A) of the immediately preceding sentence the Company shall be required to pay
the Holder $1,000. The Holder shall provide the Company written notice indicating the amounts payable to the Holder in respect of
the Buy-In and, upon request of the Company, evidence of the amount of such loss. Nothing herein shall limit a Holder’s right
to pursue any other remedies available to it hereunder, at law or in equity including, without limitation, a decree of specific
performance and/or injunctive relief with respect to the Company’s failure to timely deliver shares of Common Stock upon
exercise of the Warrant as required pursuant to the terms hereof.
v. No
Fractional Shares or Scrip. No fractional shares or scrip representing fractional shares shall be issued upon the exercise of this
Warrant. As to any fraction of a share which the Holder would otherwise be entitled to purchase upon such exercise, the Company shall,
at its election, either pay a cash adjustment in respect of such final fraction in an amount equal to such fraction multiplied by the
Exercise Price or round up to the next whole share.
vi. Charges,
Taxes and Expenses. Issuance of Warrant Shares shall be made without charge to the Holder for any issue or transfer tax or other incidental
expense in respect of the issuance of such Warrant Shares, all of which taxes and expenses shall be paid by the Company, and such Warrant
Shares shall be issued in the name of the Holder or in such name or names as may be directed by the Holder; provided, however,
that, in the event that Warrant Shares are to be issued in a name other than the name of the Holder, this Warrant when surrendered for
exercise shall be accompanied by the Assignment Form attached hereto duly executed by the Holder and the Company may require, as a condition
thereto, the payment of a sum sufficient to reimburse it for any transfer tax incidental thereto. The Company shall pay all Transfer Agent
fees required for same-day processing of any Notice of Exercise and all fees to the Depository Trust Company (or another established clearing
corporation performing similar functions) required for same-day electronic delivery of the Warrant Shares.
vii. Closing
of Books. The Company will not close its stockholder books or records in any manner which prevents the timely exercise of this Warrant,
pursuant to the terms hereof.
e)
Holder’s Exercise Limitations. The Company shall not effect any exercise of this Warrant, and a Holder shall not have the
right to exercise any portion of this Warrant, pursuant to Section 2 or otherwise, to the extent that after giving effect to such issuance
after exercise as set forth on the applicable Notice of Exercise, the Holder (together with the Holder’s Affiliates, and any other
Persons acting as a group together with the Holder or any of the Holder’s Affiliates (such Persons, “Attribution Parties”)),
would beneficially own in excess of the Beneficial Ownership Limitation (as defined below). For purposes of the foregoing sentence, the
number of shares of Common Stock beneficially owned by the Holder and its Affiliates and Attribution Parties shall include the number
of shares of Common Stock issuable upon exercise of this Warrant with respect to which such determination is being made, but shall exclude
the number of shares of Common Stock which would be issuable upon (i) exercise of the remaining, nonexercised portion of this Warrant
beneficially owned by the Holder or any of its Affiliates or Attribution Parties and (ii) exercise or conversion of the unexercised or
nonconverted portion of any other securities of the Company (including, without limitation, any other Common Stock Equivalents) subject
to a limitation on conversion or exercise analogous to the limitation contained herein beneficially owned by the Holder or any of its
Affiliates or Attribution Parties. Except as set forth in the preceding sentence, for purposes of this Section 2(e), beneficial ownership
shall be calculated in accordance with Section 13(d) of the Exchange Act and the rules and regulations promulgated thereunder, it being
acknowledged by the Holder that the Company is not representing to the Holder that such calculation is in compliance with Section 13(d)
of the Exchange Act and the Holder is solely responsible for any schedules required to be filed in accordance therewith. To the extent
that the limitation contained in this Section 2(e) applies, the determination of whether this Warrant is exercisable (in relation to
other securities owned by the Holder together with any Affiliates and Attribution Parties) and of which portion of this Warrant is exercisable
shall be in the sole discretion of the Holder, and the submission of a Notice of Exercise shall be deemed to be the Holder’s determination
of whether this Warrant is exercisable (in relation to other securities owned by the Holder together with any Affiliates and Attribution
Parties) and of which portion of this Warrant is exercisable, in each case subject to the Beneficial Ownership Limitation, and the Company
shall have no obligation to verify or confirm the accuracy of such determination. In addition, a determination as to any group status
as contemplated above shall be determined in accordance with Section 13(d) of the Exchange Act and the rules and regulations promulgated
thereunder. For purposes of this Section 2(e), in determining the number of outstanding shares of Common Stock, a Holder may rely on
the number of outstanding shares of Common Stock as reflected in (A) the Company’s most recent periodic or annual report filed
with the Commission, as the case may be, (B) a more recent public announcement by the Company or (C) a more recent written notice by
the Company or the Transfer Agent setting forth the number of shares of Common Stock outstanding. Upon the written or oral request of
a Holder, the Company shall within one Trading Day confirm orally and in writing to the Holder the number of shares of Common Stock then
outstanding. In any case, the number of outstanding shares of Common Stock shall be determined after giving effect to the conversion
or exercise of securities of the Company, including this Warrant, by the Holder or its Affiliates or Attribution Parties since the date
as of which such number of outstanding shares of Common Stock was reported. The “Beneficial Ownership Limitation”
shall be 4.99% of the number of shares of the Common Stock outstanding immediately after giving effect to the issuance of shares of Common
Stock issuable upon exercise of this Warrant. The Holder, upon notice to the Company, may increase or decrease the Beneficial Ownership
Limitation provisions of this Section 2(e), provided that the Beneficial Ownership Limitation in no event exceeds 9.99% of the number
of shares of the Common Stock outstanding immediately after giving effect to the issuance of shares of Common Stock upon exercise of
this Warrant held by the Holder and the provisions of this Section 2(e) shall continue to apply. Any increase in the Beneficial Ownership
Limitation will not be effective until the 61st day after such notice is delivered to the Company.
The provisions of this paragraph shall be construed and implemented in a manner otherwise than in strict conformity with the terms of
this Section 2(e) to correct this paragraph (or any portion hereof) which may be defective or inconsistent with the intended Beneficial
Ownership Limitation herein contained or to make changes or supplements necessary or desirable to properly give effect to such limitation.
The limitations contained in this paragraph shall apply to a successor holder of this Warrant.
Section 3. Certain Adjustments.
a) Stock
Dividends and Splits. If the Company, at any time while this Warrant is outstanding: (i) pays a stock dividend or otherwise makes
a distribution or distributions on shares of its Common Stock or any other equity or equity equivalent securities payable in shares of
Common Stock (which, for avoidance of doubt, shall not include any shares of Common Stock issued by the Company upon exercise of this
Warrant), (ii) subdivides outstanding shares of Common Stock into a larger number of shares, (iii) combines (including by way of reverse
stock split) outstanding shares of Common Stock into a smaller number of shares, or (iv) issues by reclassification of shares of the Common
Stock any shares of capital stock of the Company, then in each case the Exercise Price shall be multiplied by a fraction of which the
numerator shall be the number of shares of Common Stock (excluding treasury shares, if any) outstanding immediately before such event
and of which the denominator shall be the number of shares of Common Stock outstanding immediately after such event, and the number of
shares issuable upon exercise of this Warrant shall be proportionately adjusted such that the aggregate Exercise Price of this Warrant
shall remain unchanged. Any adjustment made pursuant to this Section 3(a) shall become effective immediately after the record date for
the determination of stockholders entitled to receive such dividend or distribution and shall become effective immediately after the effective
date in the case of a subdivision, combination or re- classification.
b) Pro
Rata Distributions. During such time as this Warrant is outstanding, if the Company shall declare or make any dividend or other
distribution of its assets (or rights to acquire its assets) to holders of shares of Common Stock, by way of return of capital or
otherwise (including, without limitation, any distribution of cash, stock or other securities, property or options by way of a
dividend, spin off, reclassification, corporate rearrangement, scheme of arrangement or other similar transaction) (a
“Distribution”), at any time after the issuance of this Warrant, then, in each such case, the Holder shall be
entitled to participate in such Distribution to the same extent that the Holder would have participated therein if the Holder had
held the number of shares of Common Stock acquirable upon complete exercise of this Warrant (without regard to any limitations on
exercise hereof, including without limitation, the Beneficial Ownership Limitation) immediately before the date of which a record is
taken for such Distribution, or, if no such record is taken, the date as of which the record holders of shares of Common Stock are
to be determined for the participation in such Distribution (provided, however, that, to the extent that the Holder's
right to participate in any such Distribution would result in the Holder exceeding the Beneficial Ownership Limitation, then the
Holder shall not be entitled to participate in such Distribution to such extent (or in the beneficial ownership of any shares of
Common Stock as a result of such Distribution to such extent) and the portion of such Distribution shall be held in abeyance for the
benefit of the Holder until such time, if ever, as its right thereto would not result in the Holder exceeding the Beneficial
Ownership Limitation).
c) Fundamental
Transaction. If, at any time while this Warrant is outstanding, (i) the Company, directly or indirectly, in one or more related
transactions effects any merger or consolidation of the Company with or into another Person, (ii) the Company (or any Subsidiary),
directly or indirectly, effects any sale, lease, license, assignment, transfer, conveyance or other disposition of all or
substantially all of its assets in one or a series of related transactions, (iii) any, direct or indirect, purchase offer, tender
offer or exchange offer (whether by the Company or another Person) is completed pursuant to which holders of Common Stock are
permitted to sell, tender or exchange their shares for other securities, cash or property and has been accepted by the holders of
50% or more of the outstanding Common Stock or 50% or more of the voting power of the common equity of the Company, (iv) the
Company, directly or indirectly, in one or more related transactions effects any reclassification, reorganization or
recapitalization of the Common Stock or any compulsory share exchange pursuant to which the Common Stock is effectively converted
into or exchanged for other securities, cash or property, or (v) the Company, directly or indirectly, in one or more related
transactions consummates a stock or share purchase agreement or other business combination (including, without limitation, a
reorganization, recapitalization, spin-off, merger or scheme of arrangement) with another Person or group of Persons whereby such
other Person or group acquires 50% or more of the outstanding shares of Common Stock or 50% or more of the voting power of the
common equity of the Company (each a “Fundamental Transaction”), then, upon any subsequent exercise of this
Warrant, the Holder shall have the right to receive, for each Warrant Share that would have been issuable upon such exercise
immediately prior to the occurrence of such Fundamental Transaction, at the option of the Holder (without regard to any limitation
in Section 2(e) or Section 2(f) on the exercise of this Warrant), the number of shares of Common Stock of the successor or acquiring
corporation or of the Company, if it is the surviving corporation, and any additional consideration (the “Alternate
Consideration”) receivable as a result of such Fundamental Transaction by a holder of the number of shares of Common Stock
for which this Warrant is exercisable immediately prior to such Fundamental Transaction (without regard to any limitation in Section
2(e) or Section 2(f) on the exercise of this Warrant). For purposes of any such exercise, the determination of the Exercise Price
shall be appropriately adjusted to apply to such Alternate Consideration based on the amount of Alternate Consideration issuable in
respect of one share of Common Stock in such Fundamental Transaction, and the Company shall apportion the Exercise Price among the
Alternate Consideration in a reasonable manner reflecting the relative value of any different components of the Alternate
Consideration. If holders of Common Stock are given any choice as to the securities, cash or property to be received in a
Fundamental Transaction, then the Holder shall be given the same choice as to the Alternate Consideration it receives upon any
exercise of this Warrant following such Fundamental Transaction. Notwithstanding anything to the contrary, in the event of a
Fundamental Transaction, the Company or any Successor Entity (as defined below) shall, at the Holder’s option, exercisable at
any time concurrently with, or within 30 days after, the consummation of the Fundamental Transaction (or, if later, the date of the
public announcement of the applicable Fundamental Transaction), purchase this Warrant from the Holder by paying to the Holder an
amount of cash equal to the Black Scholes Value (as defined below) of the remaining unexercised portion of this Warrant on the date
of the consummation of such Fundamental Transaction; provided, however, that, if the Fundamental Transaction is not
within the Company's control, including not approved by the Company's Board of Directors, the Holder shall only be entitled to
receive from the Company or any Successor Entity the same type or form of consideration (and in the same proportion), at the Black
Scholes Value of the unexercised portion of this Warrant, that is being offered and paid to the holders of Common Stock of the
Company in connection with the Fundamental Transaction, whether that consideration be in the form of cash, stock or any combination
thereof, or whether the holders of Common Stock are given the choice to receive from among alternative forms of consideration in
connection with the Fundamental Transaction; provided, further, that if holders of Common Stock of the Company are not
offered or paid any consideration in such Fundamental Transaction, such holders of Common Stock will be deemed to have received
common stock of the Successor Entity (which Entity may be the Company following such Fundamental Transaction) in such Fundamental
Transaction. “Black Scholes Value” means the value of this Warrant based on the Black-Scholes Option Pricing
Model obtained from the “OV” function on Bloomberg determined as of the day of consummation of the applicable
Fundamental Transaction for pricing purposes and reflecting (A) a risk-free interest rate corresponding to the U.S. Treasury rate
for a period equal to the time between the date of the public announcement of the applicable contemplated Fundamental Transaction
and the Termination Date, (B) an expected volatility equal to the greater of (1) the 30 day volatility, (2) the 100 day volatility
or (3) the 365 day volatility, each of clauses (1)-(3) as obtained from the HVT function on Bloomberg (determined utilizing a 365
day annualization factor) as of the Trading Day immediately following the public announcement of the applicable contemplated
Fundamental Transaction, (C) the underlying price per share used in such calculation shall be the closing bid price on the Trading
Day immediately preceding the public announcement of the applicable contemplated Fundamental Transaction (or the consummation of the
applicable Fundamental Transaction, if earlier) and ending on the Trading Day of the Holder’s request pursuant to this Section
3(e), (D) a remaining option time equal to the time between the date of the public announcement of the applicable contemplated
Fundamental Transaction and the Termination Date, and (E) a zero cost of borrow. The payment of the Black Scholes Value will be made
by wire transfer of immediately available funds (or such other consideration) within the later of (i) five Business Days of the
Holder’s election and (ii) the date of consummation of the Fundamental Transaction. 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 Warrant and the other Transaction Documents in accordance with the
provisions of this Section 3(e) pursuant to written agreements in form and substance reasonably satisfactory to the Holder and
approved by the Holder (without unreasonable delay) prior to such Fundamental Transaction and shall, at the option of the Holder,
deliver to the Holder in exchange for this Warrant a security of the Successor Entity evidenced by a written instrument
substantially similar in form and substance to this Warrant which is exercisable for a corresponding number of shares of capital
stock of such Successor Entity (or its parent entity) equivalent to the shares of Common Stock acquirable and receivable upon
exercise of this Warrant (without regard to any limitations on the exercise of this Warrant) prior to such Fundamental Transaction,
and with an exercise price which applies the exercise price hereunder to such shares of capital stock (but taking into account the
relative value of the shares of Common Stock pursuant to such Fundamental Transaction and the value of such shares of capital stock,
such number of shares of capital stock and such exercise price being for the purpose of protecting the economic value of this
Warrant immediately prior to the consummation of such Fundamental Transaction), and which is reasonably satisfactory in form and
substance to the Holder. Upon the occurrence of any such Fundamental Transaction, the Successor Entity shall be added to the term
“Company” under this Warrant (so that from and after the occurrence or consummation of such Fundamental Transaction,
each and every provision of this Warrant 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 Warrant 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 herein. For the avoidance of doubt, the Holder shall be entitled to the benefits of the
provisions of this Section 3(e) regardless of (i) whether the Company has sufficient authorized shares of Common Stock for the
issuance of Warrant Shares and/or (ii) whether a Fundamental Transaction occurs prior to the Initial Exercise Date.
d) Calculations.
All calculations under this Section 3 shall be made to the nearest cent or the nearest 1/100th of a share, as the case may be. For purposes
of this Section 3, the number of shares of Common Stock deemed to be issued and outstanding as of a given date shall be the sum of the
number of shares of Common Stock (excluding treasury shares, if any) issued and outstanding.
e)
Notice to Holder.
i. Adjustment
to Exercise Price. Whenever the Exercise Price is adjusted pursuant to any provision of this Section 3, the Company shall promptly
deliver to the Holder by email a notice setting forth the Exercise Price after such adjustment and any resulting adjustment to the number
of Warrant Shares and setting forth a brief statement of the facts requiring such adjustment.
ii. Notice
to Allow Exercise by Holder. If (A) the Company shall declare a dividend (or any other distribution in whatever form) on the Common
Stock, (B) the Company shall declare a special nonrecurring cash dividend on or a redemption of the Common Stock, (C) the Company shall
authorize the granting to all holders of the Common Stock rights or warrants to subscribe for or purchase any shares of capital stock
of any class or of any rights, (D) the approval of any stockholders of the Company shall be required in connection with any reclassification
of the Common Stock, any consolidation or merger to which the Company (or any of its Subsidiaries) is a party, any sale or transfer of
all or substantially all of its assets, or any compulsory share exchange whereby the Common Stock is converted into other securities,
cash or property, or (E) the Company shall authorize the voluntary or involuntary dissolution, liquidation or winding up of the affairs
of the Company, then, in each case, the Company shall cause to be delivered by email to the Holder at its last email address as it shall
appear upon the Warrant Register of the Company, at least 20 calendar days prior to the applicable record or effective date hereinafter
specified, a notice stating (x) the date on which a record is to be taken for the purpose of such dividend, distribution, redemption,
rights or warrants, or if a record is not to be taken, the date as of which the holders of the Common Stock of record to be entitled to
such dividend, distributions, redemption, rights or warrants are to be determined or (y) the date on which such reclassification, consolidation,
merger, sale, transfer or share exchange is expected to become effective or close, and the date as of which it is expected that holders
of the Common Stock of record shall be entitled to exchange their shares of the Common Stock for securities, cash or other property deliverable
upon such reclassification, consolidation, merger, sale, transfer or share exchange; provided that the failure to deliver such notice
or any defect therein or in the delivery thereof shall not affect the validity of the corporate action required to be specified in such
notice. To the extent that any notice provided in this Warrant constitutes, or contains, material, non-public information regarding the
Company or any of the Subsidiaries, the Company shall simultaneously file such notice with the Commission pursuant to a Current Report
on Form 8-K. The Holder shall remain entitled to exercise this Warrant during the period commencing on the date of such notice to the
effective date of the event triggering such notice except as may otherwise be expressly set forth herein.
Section 4. Transfer of Warrant.
a) Transferability.
Subject to compliance with any applicable securities laws and the conditions set forth in Section 4(d) hereof and to the provisions
of Section 4.1 of the Purchase Agreement, this Warrant and all rights hereunder (including, without limitation, any registration
rights) are transferable, in whole or in part, upon surrender of this Warrant at the principal office of the Company or its
designated agent, together with a written assignment of this Warrant substantially in the form attached hereto duly executed by the
Holder or its agent or attorney and funds sufficient to pay any transfer taxes payable upon the making of such transfer. Upon such
surrender and, if required, such payment, the Company shall execute and deliver a new Warrant or Warrants in the name of the
assignee or assignees, as applicable, and in the denomination or denominations specified in such instrument of assignment, and shall
issue to the assignor a new Warrant evidencing the portion of this Warrant not so assigned, and this Warrant shall promptly be
cancelled. Notwithstanding anything herein to the contrary, the Holder shall not be required to physically surrender this Warrant to
the Company unless the Holder has assigned this Warrant in full, in which case, the Holder shall surrender this Warrant to the
Company within three (3) Trading Days of the date on which the Holder delivers an assignment form to the Company assigning this
Warrant in full. The Warrant, if properly assigned in accordance herewith, may be exercised by a new holder for the purchase of
Warrant Shares without having a new Warrant issued.
b) New
Warrants. This Warrant may be divided or combined with other Warrants upon presentation hereof at the aforesaid office of the Company,
together with a written notice specifying the names and denominations in which new Warrants are to be issued, signed by the Holder or
its agent or attorney. Subject to compliance with Section 4(a), as to any transfer which may be involved in such division or combination,
the Company shall execute and deliver a new Warrant or Warrants in exchange for the Warrant or Warrants to be divided or combined in accordance
with such notice. All Warrants issued on transfers or exchanges shall be dated the Issue Date and shall be identical with this Warrant
except as to the number of Warrant Shares issuable pursuant thereto.
c) Warrant
Register. The Company shall register this Warrant, upon records to be maintained by the Company for that purpose (the “Warrant
Register”), in the name of the record Holder hereof from time to time. The Company may deem and treat the registered Holder
of this Warrant as the absolute owner hereof for the purpose of any exercise hereof or any distribution to the Holder, and for all other
purposes, absent actual notice to the contrary.
d) Transfer
Restrictions. If, at the time of the surrender of this Warrant in connection with any transfer of this Warrant, the transfer of
this Warrant shall not be either (i) registered pursuant to an effective registration statement under the Securities Act and under
applicable state securities or blue sky laws or (ii) eligible for resale without volume or manner-of-sale restrictions or current
public information requirements pursuant to Rule 144, the Company may require, as a condition of allowing such transfer, that the
Holder or transferee of this Warrant, as the case may be, comply with the provisions of Section 5.7 of the Purchase Agreement.
e) Representation
by the Holder. The Holder, by the acceptance hereof, represents and warrants that it is acquiring this Warrant and, upon any exercise
hereof, will acquire the Warrant Shares issuable upon such exercise, for its own account and not with a view to or for distributing or
reselling such Warrant Shares or any part thereof in violation of the Securities Act or any applicable state securities law, except pursuant
to sales registered or exempted under the Securities Act.
Section 5. Miscellaneous.
a) No
Rights as Stockholder Until Exercise; No Settlement in Cash. This Warrant does not entitle the Holder to any voting rights, dividends
or other rights as a stockholder of the Company prior to the exercise hereof as set forth in Section 2(d)(i), except as expressly set
forth in Section 3. Without limiting any rights of a Holder to receive Warrant Shares on a “cashless exercise” pursuant to
Section 2(c) or to receive cash payments pursuant to Section 2(d)(i) and Section 2(d)(iv) herein, in no event shall the Company be required
to net cash settle an exercise of this Warrant.
b) Loss,
Theft, Destruction or Mutilation of Warrant. The Company covenants that upon receipt by the Company of evidence reasonably satisfactory
to it of the loss, theft, destruction or mutilation of this Warrant or any stock certificate relating to the Warrant Shares, and in case
of loss, theft or destruction, of indemnity or security reasonably satisfactory to it (which, in the case of the Warrant, shall not include
the posting of any bond), and upon surrender and cancellation of such Warrant or stock certificate, if mutilated, the Company will make
and deliver a new Warrant or stock certificate of like tenor and dated as of such cancellation, in lieu of such Warrant or stock certificate.
c) Saturdays,
Sundays, Holidays, etc. If the last or appointed day for the taking of any action or the expiration of any right required or granted
herein shall not be a Business Day, then such action may be taken or such right may be exercised on the next succeeding Business Day.
d)
Authorized Shares.
The Company covenants
that, during the period the Warrant is outstanding, it will reserve from its authorized and unissued Common Stock a sufficient number
of shares to provide for the issuance of the Warrant Shares upon the exercise of any purchase rights under this Warrant. The Company further
covenants that its issuance of this Warrant shall constitute full authority to its officers who are charged with the duty of issuing the
necessary Warrant Shares upon the exercise of the purchase rights under this Warrant. The Company will take all such reasonable action
as may be necessary to assure that such Warrant Shares may be issued as provided herein without violation of any applicable law or regulation,
or of any requirements of the Trading Market upon which the Common Stock may be listed. The Company covenants that all Warrant Shares
which may be issued upon the exercise of the purchase rights represented by this Warrant will, upon exercise of the purchase rights represented
by this Warrant and payment for such Warrant Shares in accordance herewith, be duly authorized, validly issued, fully paid and nonassessable
and free from all taxes, liens and charges created by the Company in respect of the issue thereof (other than taxes in respect of any
transfer occurring contemporaneously with such issue).
Except
and to the extent as waived or consented to by the Holder, the Company shall not by any action, including, without limitation,
amending its certificate of incorporation or through any reorganization, transfer of assets, consolidation, merger, dissolution,
issue or sale of securities or any other voluntary action, avoid or seek to avoid the observance or performance of any of the terms
of this Warrant, but will at all times in good faith assist in the carrying out of all such terms and in the taking of all such
actions as may be necessary or appropriate to protect the rights of Holder as set forth in this Warrant against impairment. Without
limiting the generality of the foregoing, the Company will (i) not increase the par value of any Warrant Shares above the amount
payable therefor upon such exercise immediately prior to such increase in par value, (ii) take all such action as may be necessary
or appropriate in order that the Company may validly and legally issue fully paid and nonassessable Warrant Shares upon the exercise
of this Warrant and (iii) use commercially reasonable efforts to obtain all such authorizations, exemptions or consents from any
public regulatory body having jurisdiction thereof, as may be, necessary to enable the Company to perform its obligations under this
Warrant.
Before taking
any action which would result in an adjustment in the number of Warrant Shares for which this Warrant is exercisable or in the Exercise
Price, the Company shall obtain all such authorizations or exemptions thereof, or consents thereto, as may be necessary from any public
regulatory body or bodies having jurisdiction thereof.
e) Jurisdiction.
All questions concerning the construction, validity, enforcement and interpretation of this Warrant shall be determined in accordance
with the provisions of the Purchase Agreement.
f) Restrictions.
The Holder acknowledges that the Warrant Shares acquired upon the exercise of this Warrant, if not registered, and the Holder does not
utilize cashless exercise, will have restrictions upon resale imposed by state and federal securities laws.
g) Nonwaiver
and Expenses. No course of dealing or any delay or failure to exercise any right hereunder on the part of Holder shall operate as
a waiver of such right or otherwise prejudice the Holder’s rights, powers or remedies. Without limiting any other provision of this
Warrant or the Purchase Agreement, if the Company willfully and knowingly fails to comply with any provision of this Warrant, which results
in any material damages to the Holder, the Company shall pay to the Holder such amounts as shall be sufficient to cover any costs and
expenses including, but not limited to, reasonable attorneys’ fees, including those of appellate proceedings, incurred by the Holder
in collecting any amounts due pursuant hereto or in otherwise enforcing any of its rights, powers or remedies hereunder.
h) Notices.
Any notice, request or other document required or permitted to be given or delivered to the Holder by the Company shall be delivered in
accordance with the notice provisions of the Purchase Agreement.
i) Limitation
of Liability. No provision hereof, in the absence of any affirmative action by the Holder to exercise this Warrant to purchase Warrant
Shares, and no enumeration herein of the rights or privileges of the Holder, shall give rise to any liability of the Holder for the purchase
price of any Common Stock or as a stockholder of the Company, whether such liability is asserted by the Company or by creditors of the
Company.
j) Remedies.
The Holder, in addition to being entitled to exercise all rights granted by law, including recovery of damages, will be entitled to specific
performance of its rights under this Warrant. The Company agrees that monetary damages would not be adequate compensation for any loss
incurred by reason of a breach by it of the provisions of this Warrant and hereby agrees to waive and not to assert the defense in any
action for specific performance that a remedy at law would be adequate.
k) Successors
and Assigns. Subject to applicable securities laws, this Warrant and the rights and obligations evidenced hereby shall inure to the
benefit of and be binding upon the successors and permitted assigns of the Company and the successors and permitted assigns of Holder.
The provisions of this Warrant are intended to be for the benefit of any Holder from time to time of this Warrant and shall be enforceable
by the Holder or holder of Warrant Shares.
l) Amendment.
This Warrant may be modified or amended or the provisions hereof waived with the written consent of the Company and the Holder.
m) Severability.
Wherever possible, each provision of this Warrant shall be interpreted in such manner as to be effective and valid under applicable law,
but if any provision of this Warrant shall be prohibited by or invalid under applicable law, such provision shall be ineffective to the
extent of such prohibition or invalidity, without invalidating the remainder of such provisions or the remaining provisions of this Warrant.
n) Headings.
The headings used in this Warrant are for the convenience of reference only and shall not, for any purpose, be deemed a part of this Warrant.
********************
(Signature Page Follows)
IN WITNESS WHEREOF, the Company
has caused this Warrant to be executed by its officer thereunto duly authorized as of the date first above indicated.
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WETRADE GROUP INC. |
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By: |
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Name: |
Wei He Chun |
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Title: |
CEO |
NOTICE OF EXERCISE
TO: WETRADE GROUP INC.
(1) The undersigned
hereby elects to purchase Warrant Shares of the Company pursuant to the terms of the attached Warrant (only if exercised in
full), and tenders herewith payment of the exercise price in full, together with all applicable transfer taxes, if any.
(2)
Payment shall take the form of (check applicable box):
☐ in lawful money of the United States; or
☐ if permitted the cancellation
of such number of Warrant Shares as is necessary, in accordance with the formula set forth in subsection 2(c), to exercise this Warrant
with respect to the maximum number of Warrant Shares purchasable pursuant to the cashless exercise procedure set forth in subsection 2(c).
(3) Please
issue said Warrant Shares in the name of the undersigned or in such other name as is specified below:
_______________________________
The Warrant Shares shall be delivered to the following DWAC
Account Number:
_______________________________
_______________________________
_______________________________
(4) Accredited
Investor. The undersigned is an “accredited investor” as defined in Regulation D promulgated under the Securities Act
of 1933, as amended.
[SIGNATURE OF HOLDER]
Name of Investing Entity:____________________________________________________________________________
Signature of Authorized Signatory of Investing
Entity:______________________________________________________
Name of Authorized Signatory:________________________________________________________________________
Title of Authorized Signatory:_________________________________________________________________________
Date:____________________________________________________________________________________________
EXHIBIT B
ASSIGNMENT FORM
(To assign the foregoing Warrant,
execute this form and supply required information. Do not use this form to purchase shares.)
FOR
VALUE RECEIVED, the foregoing Warrant and all rights evidenced thereby are hereby assigned to
Name: |
_______________________________________________ |
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(Please Print) |
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Address: |
_______________________________________________ |
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(Please Print) |
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Phone Number: |
_______________________________________________ |
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Email Address: |
_______________________________________________ |
Dated:_________________,_______
Holder’s Signature:_______________________
Holder’s Address:_________________________
14
v3.23.2
Cover
|
Aug. 23, 2023 |
Cover [Abstract] |
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Document Type |
8-K
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Amendment Flag |
false
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Document Period End Date |
Aug. 23, 2023
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Entity File Number |
001-41450
|
Entity Registrant Name |
WeTrade Group Inc.
|
Entity Central Index Key |
0001784970
|
Entity Tax Identification Number |
00-0000000
|
Entity Incorporation, State or Country Code |
WY
|
Entity Address, Address Line One |
Room 101, Level 1 Building 8
|
Entity Address, Address Line Two |
No. 18, Kechuang 10th Street
|
Entity Address, City or Town |
Beijing Economic and
Technological Development Zone
|
Entity Address, Country |
CN
|
Entity Address, Postal Zip Code |
100020
|
City Area Code |
86
|
Local Phone Number |
135-011-76409
|
Written Communications |
false
|
Soliciting Material |
false
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Pre-commencement Tender Offer |
false
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Pre-commencement Issuer Tender Offer |
false
|
Entity Emerging Growth Company |
true
|
Elected Not To Use the Extended Transition Period |
false
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