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):
July 12, 2024
Aditxt, Inc.
(Exact name of registrant as specified in its charter)
|
Delaware |
|
001-39336 |
|
82-3204328 |
(State or other jurisdiction
of incorporation) |
|
(Commission File Number) |
|
(I.R.S. Employer
Identification No.) |
| 2569 Wyandotte Street, Suite 101, Mountain View, CA 94043 |
| (Address of principal executive offices, including zip code) |
Registrant’s telephone number, including
area code: (650) 870-1200
Not Applicable
(Former name or former address, if changed since last report)
Check the appropriate box
below if the Form 8-K is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
| ☒ | Written communications pursuant
to Rule 425 under the Securities Act (17 CFR 230.425) |
| ☐ | Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| ☐ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| ☐ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Securities registered pursuant to Section 12(b)
of the Act:
|
Title of each class |
|
Trading Symbol(s) |
|
Name of each
exchange on which registered |
| Common Stock, par value $0.001 |
|
ADTX |
|
The Nasdaq Stock Market LLC |
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
Merger Agreement
On July 12, 2024 (the “Execution
Date”), Aditxt, Inc., a Delaware corporation (the “Company”) entered into an Amended and Restated Agreement
and Plan of Merger (the “Merger Agreement”) with Adifem, Inc. f/k/a Adicure, Inc., a Delaware corporation and wholly
owned subsidiary of the Company (“Merger Sub”) and Evofem Biosciences, Inc., a Delaware corporation (“Evofem”),
pursuant to which, Merger Sub will be merged into and with Evofem (the “Merger”), with Evofem surviving the Merger
as a wholly owned subsidiary of the Company. The Merger Agreement amended and restated that certain Agreement and Plan of Merger dated
as of December 11, 2023 by and among the Company, Merger Sub and Evofem (as amended, the “Original Agreement”)
Effect on Capital Stock
Subject to the terms and conditions
set forth in the Merger Agreement, at the effective time of the Merger (the “Effective Time”), (i) all issued and outstanding
shares of common stock, par value $0.0001 per share of Evofem (“Evofem Common Stock”), other than any shares of Evofem
Common Stock either held by the Company or Merger Sub immediately prior to the Effective Time or which are Dissenting Shares (as hereinafter
defined), will be converted into the right to receive an aggregate of $1,800,000; and (ii) each issued and outstanding share of Series
E-1 Preferred Stock, par value $0.0001 of Evofem (the “Evofem Unconverted Preferred Stock”), other than any shares
of Evofem Unconverted Preferred Stock either held by the Company or Merger Sub immediately prior to the Effective Time or which are Dissenting
Shares, will be converted into the right to receive one (1) share of Series A-2 Preferred Stock, par value $0.001 of the Company (the
“Company Preferred Stock”), having such rights, powers, and preferences set forth in the form of Certificate of Designation
of Series A-2 Preferred Stock, the form of which is attached as Exhibit C to the Merger Agreement.
Any Evofem capital stock outstanding
immediately prior to the Effective Time and held by an Evofem shareholder who has not voted in favor of or consented to the adoption of
the Merger Agreement and who is entitled to demand and has properly demanded appraisal for such Company Capital Stock in accordance with
the Delaware General Corporation Law (“DGCL”), and who, as of the Effective Time, has not effectively withdrawn or
lost such appraisal rights (such Evofem capital Stock, “Dissenting Shares”) shall not be converted into or be exchangeable
for the right to receive a portion of the Merger Consideration and, instead, shall be entitled to only those rights as set forth in the
DGCL. If, after the Effective Time, any such holder fails to perfect or withdraws or loses his, her or its right to appraisal under the
DGCL, with respect to any Dissenting Shares, upon surrender of the certificate(s) representing such Dissenting Shares, such Dissenting
Shares shall thereupon be treated as if they had been converted as of the Effective Time into the right to receive the portion of the
merger consideration, if any, to which such Evofem capital stock is entitled pursuant to the Merger Agreement, without interest.
As a closing condition for
the Company, there shall be no more than 4,141,434 Dissenting Shares that are Evofem Common Stock or 98 Dissenting Shares that are Evofem
Preferred Stock.
Treatment of Evofem Options and Employee
Stock Purchase Plan
At the Effective Time, each
option outstanding under the Evofem 2014 Equity Incentive Plan, the Evofem 2018 Inducement Equity Incentive Plan and the Evofem 2019 Employee
Stock Purchase Plan (collectively, the “Evofem Option Plans”), whether or not vested, will be canceled without the
right to receive any consideration, and the board of directors of Evofem shall take such action such that the Evofem Option Plans are
cancelled as of the Effective Time.
As soon as practicable following
the Execution Date, Evofem will take all action that may be reasonably necessary to provide that: (i) no new offering period will commence
under the Evofem 2019 Employee Stock Purchase Plan (the “Evofem ESPP”); (ii) participants in the Evofem ESPP as of
the Execution Date shall not be permitted to increase their payroll deductions or make separate non-payroll contributions to the Evofem
ESPP; and (iii) no new participants may commence participation in the Evofem ESPP following the Execution Date. Prior to the Effective
Time, Evofem will take all action that may be reasonably necessary to: (A) cause any offering period or purchase period that otherwise
be in progress at the Effective Time to be the final offering period under the Evofem ESPP and to be terminated no later than five business
days prior to the anticipated closing date (the “Final Exercise Date”); (B) make any pro-rata adjustments that may
be necessary to reflect the shortened offering period or purchase period; (C) cause each participant’s then-outstanding share purchase
right under the Evofem ESPP to be exercised as of the Final Exercise Date; and (D) terminate the Evofem ESPP, as of and contingent upon,
the Effective Time.
Representations and Warranties
The parties to the Merger
Agreement have agreed to customary representations and warranties for transactions of this type.
Covenants
The Merger Agreement contains
various customary covenants, including but not limited to, covenants with respect to the conduct of Evofem’s business prior to the
Effective Time.
Closing Conditions
Mutual
The respective obligations of each of
the Company, Merger Sub and Evofem to consummate the closing of the Merger (the “Closing”) are subject to the satisfaction
or waiver, at or prior to the closing of certain conditions, including but not limited to, the following:
| (i) | approval by the Evofem shareholders; |
| (ii) | the entry into a voting agreement by the Company and certain members of Evofem management; |
| (iii) | all preferred stock of Evofem other than the Evofem Unconverted Preferred Stock shall have been converted
to Evofem Common Stock; |
| (iv) | Evofem shall have received agreements (the “Evofem Warrant Holder Agreements”) from
all holders of Evofem warrants which provide: (a) waivers with respect to any fundamental transaction, change in control or other similar
rights that such warrant holder may have under any such Evofem warrants, and (b) an agreement to such Evofem warrants to exchange such
warrants for not more than an aggregate (for all holders of Evofem warrants) of 930.336 shares of Company Preferred Stock; |
| (vi) | Evofem shall have cashed out any other holder of Evofem warrants who has not provided an Evofem Warrant
Holder Agreement; and |
| (vii) | Evofem shall have obtained waivers from the holders of the convertible notes of Evofem (the “Evofem
Convertible Notes”) with respect to any fundamental transaction rights that such holder may have under the Evofem Convertible
Notes, including any right to vote, consent, or otherwise approve or veto any of the transactions contemplated under the Merger Agreement. |
| (viii) | The Company shall have received sufficient financing to satisfy
its payment obligations under the Merger Agreement. |
| (ix) | The requisite stockholder approval shall have been obtained by the Company at a Special Meeting of its
stockholders to approve the Parent Stock Issuance (as defined in the Merger Agreement) pursuant to the requirements of NASDAQ. |
The Company and Merger
Sub
The obligations of the Company and Merger
Sub to consummate the Closing are subject to the satisfaction or waiver, at or prior to the Closing of certain conditions, including but
not limited to, the following:
| (i) | the Company shall have obtained agreements from the holders of Evofem Convertible Notes and purchase rights
they hold to exchange such Convertible Notes and purchase rights for not more than an aggregate (for all holders of Evofem Convertible
Notes) of 88,161 shares of Company Preferred Stock; |
| (ii) | the Company shall have received waivers form the holders of certain of the Company’s securities
which contain prohibitions on variable rate transactions; and |
| (iii) | the Company, Merger Sub and Evofem shall work together between the Execution Date and the Effective Time
to determine the tax treatment of the Merger and the other transactions contemplated by the Merger Agreement. |
Evofem
The obligations of Evofem
to consummate the Closing are subject to the satisfaction or waiver, at or prior to the Closing of certain conditions, including but not
limited to, the following:
| (i) | The Company shall be in compliance with the stockholders’ equity requirement in Nasdaq Listing Rule
5550(b)(1) and shall meet all other applicable criteria for continued listing. |
Termination
The Merger Agreement may be
terminated at any time prior to the consummation of the Closing by mutual written consent of the Company and Evofem. Either the Company
or Evofem may also terminate the Merger Agreement if (i) the Merger shall not have been consummated on or before 5:00 p.m. Eastern Time
on September 30, 2024; (ii) if any judgment, law or order prohibiting the Merger or the Transactions has become final and non-appealable;
(iii) the required vote of Evofem stockholders was not obtained; or (iv) in the event of any Terminable Breach (as defined in the Merger
Agreement). The Company may terminate the Merger Agreement if (i) prior to approval by the required vote of Evofem’s shareholders
if the Evofem board of directors shall have effected a Company Change in Recommendation (as defined in the Merger Agreement); or (ii)
in the event that the Company determines, in its reasonable discretion, that the acquisition of Evofem could result in a material adverse
amount of cancellation of indebtedness income to the Company. Evofem may terminate the Merger Agreement if (i) at any time after there
has been a Company Change of Recommendation; provided, that Evofem has provided the Company ten (10) calendar days’ prior
written notice thereof and has negotiated in good faith with the Company to provide a competing offer; (ii) the Company Common Stock is
no longer listed for trading on Nasdaq; or (iii) any of: (A) the Initial Parent Equity Investment has not been made by the Initial Parent
Equity Investment Date, (B) the Second Parent Equity Investment has not been made by the Second Parent Equity Investment Date, (C) the
Third Parent Equity Investment has not been made by the Third Parent Equity Investment Date or (D) the Fourth Parent Equity Investment
has not been made by the Fourth Parent Equity Investment Date (as all of such terms are defined in the Merger Agreement).
Effect of Termination
If the Merger Agreement is
terminated, the Merger Agreement will become void, and there will be no liability under the Merger Agreement on the part of any party
thereto.
Waiver Agreement
On July 12, 2024, the Company,
Merger Sub and Evofem also entered into a Waiver Agreement (the “Waiver Agreement”), pursuant to which: (i) Evofem
waived its Termination Right (as defined in the Merger Agreement) for such breaches by the Company and Merger Sub that have occurred prior
to the date of the Waiver Agreement; (ii) the Company and Merger Sub waived the restrictive covenants in the Merger Agreement that would
otherwise prevent Evofem from entering into and closing the transaction contemplated under that certain Asset Purchase Agreement by and
between Evofem and Lupin, Inc. (the “Asset Purchase Agreement”); and (iii) the Company and Merger Sub waived the restrictive
covenants in the Merger Agreement that would otherwise restrict Evofem from entering into a financing arrangement relating to its directors’
and officers’ insurance policy.
Copies of the Merger Agreement
and Waiver Agreement are filed with this Current Report on Form 8-K as Exhibit 2.1 and Exhibit 10.1, respectively,
and are incorporated herein by reference. The foregoing descriptions of the Merger Agreement, Waiver Agreement and the transactions contemplated
thereby are incomplete and is subject to, and qualified in their entirety by, reference to the actual agreements. The Merger Agreement,
Waiver Agreement and other agreements described above have been included as exhibits to this Current Report on Form 8-K to provide security
holders with information regarding their terms. They are not intended to provide any other factual information about the Company, Merger
Sub or Evofem. In particular, the assertions embodied in representations and warranties by the Company, Merger Sub and Evofem contained
in the Merger Agreement were made as of a specified date, are subject to important qualifications and limitations agreed to by the parties
in connection with negotiating such agreement, including being qualified by confidential information in the disclosure letters provided
by the parties in connection with the execution of the Merger Agreement, and are subject to standards of materiality applicable to the
contractive parties that may differ from those applicable to security holders. The confidential disclosures contain information that modifies,
qualifies and creates exceptions to the representations and warranties set forth in the Merger Agreement. Moreover, certain representations
and warranties in the Merger Agreement were used for the purpose of allocating risk between the parties, rather than establishing matters
as facts. Accordingly, security holders should not rely on the representations and warranties in the Merger Agreement as characterizations
of the actual state of facts about the Company, Merger Sub or Evofem. Moreover, information concerning the subject matter of the representations
and warranties may change after the date of the Merger Agreement, which subsequent information may or may not be fully reflected in the
Company’s public disclosures.
Securities Purchase
Agreement – Senior Notes
On
July 12, 2024, the Company entered into a Securities Purchase Agreement (the “Securities Purchase Agreement”) with
certain accredited investors, pursuant to which the Company issued and sold senior notes in the aggregate principal amount of $875,000
(the “Note”) maturing on October 7, 2024. The Company received cash proceeds of $700,000 from the sale of the Notes.
Upon
an Event of Default (as defined in the Note), the Note will bear interest at a rate of 14% per annum and the holder shall have the right
to require the Company to redeem the Note at a redemption premium of 125%. In addition, while the Note is outstanding, the Company is
required to utilize 100% of the proceeds from any offering of securities to redeem the Note. Pursuant to the Purchase Agreement, the Company
agreed to use commercially reasonable efforts, including the filing of a registration statement with the U.S. Securities and Exchange
Commission (the “SEC”) for a public offering, to pursue and consummate a financing transaction within 90 days of the
closing date. In connection with the issuance of the Notes, the Company issued warrants (the “Warrants”) to purchase
up to 1,750,000 shares of the Company’s common stock (the “Warrant Shares”). Pursuant to the Purchase Agreement,
the Company also agreed to file a registration statement with the SEC covering the resale of the Warrant Shares as soon as practicable
following notice from an investor, and to cause such registration statement to become effective within 60 days following the filing thereof.
The Warrants are exercisable following Stockholder Approval (as defined in the Purchase Agreement) at an initial exercise price of $1.582
per share for a term of five years.
The
foregoing descriptions of the Securities Purchase Agreement, Note, and Warrant are not complete and are qualified in their entirety by
reference to the full text of the forms of the Securities Purchase Agreement, Note, and Warrant copies of which are filed as Exhibit
10.2, Exhibit 10.3, and Exhibit 4.1, respectively to this Current Report on Form 8-K and are incorporated by reference
herein.
Securities Purchase
Agreement – Evofem Series F-1 Convertible Preferred Stock
On July 12, 2024 (the
“Closing Date”), the Company completed the Initial Parent Equity
Investment (as defined under the Merger Agreement) and entered into a Securities Purchase (the “Series
F-1 Securities Purchase Agreement”) with Evofem, pursuant to which the Company purchased 500 shares of Evofem’s
Series F-1 Convertible Preferred Stock par value $0.0001 per share (“Evofem F-1
Preferred Stock”) for an aggregate purchase price of $500,000. In connection with the Series F-1 Securities Purchase
Agreement, the Company and Evofem entered into a Registration Rights Agreement (the “Registration
Rights Agreement”), pursuant to which Evofem agreed to file with the SEC a registration statement covering the resale
of the shares of its common stock issuable upon conversion of the Evofem Series F-1 Preferred Stock within 300 days of the Closing
Date and to have such registration statement declared effective by the SEC the earlier of the (i) 90th calendar day after
the Closing Date and (ii) 2nd Business Day after the date Evofem is notified (orally or in writing, whichever is earlier)
by the SEC that such registration statement will not be reviewed or will not be subject to further review. Pursuant to the Merger
Agreement, the Company is also obligated to purchase: (i) an additional 500 shares of Evofem Series F-1 Preferred Stock for an
additional aggregate purchase price of $500,000 on or prior to August 9, 2024; (ii) an additional 2,000 shares of Evofem Series F-1
Preferred Stock for an additional purchase price of $2 million on the earlier of August 30, 2024 or 5 business days of the closing
of a public offering by the Company resulting in aggregate net proceeds to the Company of no less than $20 million; and (iii) an
additional 1,000 shares of Evofem Series F-1 Preferred Stock for an additional purchase price of $1 million on or prior to September
30, 2024.
The foregoing descriptions
of the Series F-1 Securities Purchase Agreement and Registration Rights Agreement are not complete and are qualified in their entirety
by reference to the full text of the forms of the Series F-1 Securities Purchase Agreement and Registration Rights Agreement, copies of
which are filed as Exhibit 10.4 and Exhibit 10.5, respectively to this Current Report on Form 8-K and are incorporated by
reference herein.
Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant
The
information set forth in “Item 1.01 Entry into a Material Definitive Agreement”
relating to the issuance of the Notes is incorporated by reference herein in its entirety.
Item 3.02 Unregistered Sales of Equity Securities
The
information set forth in “Item 1.01 Entry into a Material Definitive Agreement”
relating to the issuance of the Notes is incorporated by reference herein in its entirety. The Company issued the Notes in reliance upon
the exemption from registration provided by Section 4(a)(2) of the Securities Act.
Item 7.01. Regulation FD Disclosure.
On July 17, 2024, the Company
issued a press release announcing the execution of the Merger Agreement and Evofem’s entry into the Asset Purchase Agreement. A
copy of the press release is furnished hereto as Exhibit 99.1 and incorporated in this Item 7.01 by reference.
The information in this Item
7.01 and Exhibit 99.1 will not be deemed to be filed for purposes of Section 18 of the Exchange Act or otherwise be subject to the liabilities
of that section, nor will it be deemed to be incorporated by reference in any filing under the Securities Act or the Exchange Act, except
as expressly set forth by specific reference in such filing. The submission of the information set forth in this Item 7.01 shall not be
deemed an admission as to the materiality of any information in this Item 7.01, including the information presented in Exhibit 99.1, that
is provided solely in connection with Regulation FD.
Important Information for Stockholders
This Current Report on Form
8-K and the exhibits hereto is not a proxy statement or solicitation of a proxy, consent or authorization with respect to any securities
or in respect of the potential transactions and shall not constitute an offer to sell or a solicitation of any vote or approval, or of
an offer to buy the securities of the Company or Evofem, nor shall there be any sale of any such securities in any state or jurisdiction
in which such offer, solicitation, or sale would be unlawful prior to registration or qualification under the securities laws of such
state or jurisdiction. No offer of securities shall be made except by means of a prospectus meeting the requirements of the Securities
Act.
In connection with the proposed
transactions, the Company intends to file the Proxy Statement with the SEC. The Company also plans to file other documents with the SEC
regarding the proposed transactions. After the Proxy Statement has been cleared by the SEC, a definitive proxy statement/prospectus will
be mailed to the stockholders of the Company. STOCKHOLDERS OF THE COMPANY AND EVOFEM ARE URGED TO CAREFULLY READ THE PROXY STATEMENT (INCLUDING
ALL AMENDMENTS AND SUPPLEMENTS THERETO) AND OTHER DOCUMENTS RELATING TO THE PROPOSED TRANSACTIONS THAT WILL BE FILED WITH THE SEC IN THEIR
ENTIRETY WHEN THEY BECOME AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT THE PROPOSED TRANSACTIONS. Stockholders will
be able to obtain free copies of the proxy statement and other documents containing important information about the Company and Evofem
once such documents are filed with the SEC, through the website maintained by the SEC at http://www.sec.gov.
Participants in the Solicitation
The Company and its executive
officers, directors, other members of management, employees and Evofem may be deemed, under SEC rules, to be participants in the solicitation
of proxies from the Company’s shareholders with respect to the proposed transaction. Information regarding the executive officers
and directors of the Company is set forth in its definitive proxy statement for its 2023 annual meeting filed with the SEC on July 5,
2024. More detailed information regarding the identity of potential participants, and their direct or indirect interests, by securities
holdings or otherwise, will be set forth in the Proxy Statement and other materials to be filed with the SEC in connection with the Merger
Agreement.
Cautionary Note on Forward-Looking Statements
This Current Report on Form
8-K contains certain forward-looking statements within the meaning of the “safe harbor” provisions under the United States
Private Securities Litigation Reform Act of 1995. All statements other than statements of historical facts contained in this Current Report
on Form 8-K, including statements regarding the Company’s or Evofem’s future results of operations and financial position
are forward-looking statements. These forward-looking statements generally are identified by the words “believe,” “project,”
“expect,” “anticipate,” “estimate,” “target,” “intend,” “strategy,”
“future,” “opportunity,” “plan,” “may,” “should,” “will,” “would,”
“will be,” “will continue,” “will likely result,” and similar expressions. These statements are based
on various assumptions, whether or not identified in this Current Report on Form 8-K, and on the current expectations of the respective
management teams of the Company and Evofem and are not predictions of actual performance. These forward-looking statements are provided
for illustrative purposes only and are not intended to serve as, and must not be relied on by an investor as, a guarantee, an assurance,
a prediction or a definitive statement of fact or probability. Actual events and circumstances are difficult or impossible to predict
and will differ from assumptions. Many actual events and circumstances are beyond the control of the Company and Evofem.
These forward-looking statements
are subject to a number of risks including, but not limited to, the following risks relating to the proposed transactions: (1) the risk
that the proposed transactions may not be completed in a timely manner or at all, which may adversely affect the price of the Company’s
securities; (2) the failure to satisfy the conditions to closing; (3) the ability to realize the anticipated benefits of the proposed
transactions; and (4) other risks and uncertainties indicated from time to time in the Company’s public filings with the SEC. If
any of these risks materialize or the Company’s and Evofem’s assumptions prove incorrect, actual results could differ materially
from the results implied by these forward-looking statements. You should carefully consider the risks and uncertainties described in the
“Risk Factors” section of our Annual Report on Form 10-K for the fiscal year ended December 31, 2023 and other documents we
filed, or will file, including the proxy statement, with the SEC. There may be additional risks that neither the Company nor Evofem presently
know, or that the Company or Evofem currently believe are immaterial, that could also cause actual results to differ from those contained
in the forward-looking statements. In addition, forward-looking statements reflect the Company’s and Evofem’s expectations,
plans or forecasts of future events and views as of the date of this Current Report on Form 8-K. The Company and Evofem anticipate that
subsequent events and developments will cause the Company’s and Evofem’s assessments to change. However, while the Company
and Evofem may elect to update these forward-looking statements at some point in the future, the Company and Evofem specifically disclaim
any obligation to do so, except as otherwise required by law. These forward-looking statements should not be relied upon as representing
the Company’s and Evofem’s assessments of any date subsequent to the date of this Current Report on Form 8-K. Accordingly,
undue reliance should not be placed upon the forward-looking statements.
No Offer or Solicitation
This Current Report on Form
8-K is not a proxy statement or solicitation of a proxy, consent or authorization with respect to any securities or in respect of the
proposed transaction and shall not constitute an offer to sell or a solicitation of an offer to buy any securities, nor shall there be
any sale of securities in any state or jurisdiction in which such offer, solicitation, or sale would be unlawful prior to registration
or qualification under the securities laws of such state or jurisdiction. No offer of securities shall be made except by means of a prospectus
meeting the requirements of the Securities Act.
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits.
| Exhibit No. |
|
Exhibit |
| 2.1 † |
|
Amended and Restated Agreement and Plan of Merger among Aditxt, Inc., Adifem, Inc. f/k/a Adicure, Inc. and Evofem Biosciences, Inc. dated as of July 12, 2024 |
| 4.1 |
|
Form of Warrant |
| 10.1 |
|
Waiver Agreement by and between Evofem Biosciences, Inc., Aditxt, Inc. and Adifem, Inc. dated July 12, 2024 |
| 10.2 |
|
Form of Securities Purchase Agreement |
| 10.3 |
|
Form of Senior Note |
| 10.4 |
|
Securities Purchase Agreement by and among Evofem Biosciences, Inc. and Aditxt, Inc. dated July 12, 2024 |
| 10.5 |
|
Registration Rights Agreement by and among Evofem Biosciences, Inc. and Aditxt, Inc. dated July 12, 2024 |
| 99.1 |
|
Press Release, dated July 17, 2024 |
| 104 |
|
Cover Page Interactive Data File (embedded within the XBRL document) |
| † | Certain of the schedules (and/or exhibits) have been omitted pursuant to Item 601(b)(2) of Regulation
S-K. A copy of any omitted schedule (and/or exhibit) will be furnished to the SEC upon request |
SIGNATURE
Pursuant to the requirements of the Securities
Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| Date: July 18, 2024 | Aditxt, Inc. |
| | | |
| | By: | /s/ Amro Albanna |
| | Name: | Amro Albanna |
| | Title: | Chief Executive Officer |
10
Exhibit 2.1
AMENDED AND RESTATED
AGREEMENT AND PLAN OF MERGER
among
ADITXT, INC.,
ADIFEM, INC., FKA ADICURE, INC.
and
EVOFEM BIOSCIENCES, INC.
Dated as of July 12, 2024
TABLE OF CONTENTS
| |
|
Page |
| |
|
|
| Article I CERTAIN DEFINITIONS |
2 |
| |
|
|
| Section 1.1 |
Certain Definitions |
2 |
| Section 1.2 |
Terms Defined Elsewhere |
2 |
| |
|
|
| Article II THE MERGER |
4 |
| |
|
|
| Section 2.1 |
The Merger |
4 |
| Section 2.2 |
Closing |
4 |
| Section 2.3 |
Effect of the Merger |
4 |
| Section 2.4 |
Organizational Documents |
5 |
| Section 2.5 |
Directors and Officers of the Surviving Company |
5 |
| |
|
|
| Article III EFFECT OF THE MERGER ON THE CAPITAL STOCK OF THE COMPANY AND MERGER SUB; EXCHANGE |
5 |
| |
|
|
| Section 3.1 |
Effect of the Merger on Capital Stock |
5 |
| Section 3.2 |
Payment for Securities; Exchange |
8 |
| |
|
|
| Article IV REPRESENTATIONS AND WARRANTIES OF THE COMPANY |
11 |
| |
|
|
| Section 4.1 |
Organization, Standing and Power |
11 |
| Section 4.2 |
Capital Structure |
12 |
| Section 4.3 |
Authority; No Violations; Approvals |
13 |
| Section 4.4 |
Consents |
14 |
| Section 4.5 |
SEC Documents; Financial Statements; Internal Controls and Procedures |
14 |
| Section 4.6 |
Absence of Certain Changes or Events |
16 |
| Section 4.7 |
No Undisclosed Material Liabilities |
16 |
| Section 4.8 |
[Intentionally omitted] |
16 |
| Section 4.9 |
Company Permits; Compliance with Applicable Law |
16 |
| Section 4.10 |
Compensation; Benefits |
17 |
| Section 4.11 |
Employment and Labor Matters |
18 |
| Section 4.12 |
Taxes |
19 |
| Section 4.13 |
Litigation |
21 |
| Section 4.14 |
Intellectual Property |
22 |
| Section 4.15 |
Real Property |
23 |
| Section 4.16 |
Material Contracts |
24 |
| Section 4.17 |
Insurance |
25 |
| Section 4.18 |
Environmental Matters |
25 |
| Section 4.19 |
Brokers |
26 |
| Section 4.20 |
State Takeover Statute |
26 |
| Section 4.21 |
Investment Company Act |
26 |
| Section 4.22 |
Related Party Transactions |
26 |
| Section 4.23 |
FDA Regulatory |
26 |
| Section 4.24 |
No Additional Representations |
28 |
| Article V REPRESENTATIONS AND WARRANTIES OF PARENT AND MERGER SUB |
29 |
| |
|
|
| Section 5.1 |
Organization, Standing and Power |
30 |
| Section 5.2 |
Capital Structure |
30 |
| Section 5.3 |
Authority; No Violations; Approvals |
31 |
| Section 5.4 |
Consents |
31 |
| Section 5.5 |
SEC Documents; Financial Statements; Internal Controls and Procedures |
32 |
| Section 5.6 |
Absence of Certain Changes or Events |
33 |
| Section 5.7 |
No Undisclosed Material Liabilities |
33 |
| Section 5.8 |
Information Supplied |
33 |
| Section 5.9 |
Parent Permits; Compliance with Applicable Law |
33 |
| Section 5.10 |
Compensation; Benefits |
34 |
| Section 5.11 |
Labor Matters |
35 |
| Section 5.12 |
Taxes |
36 |
| Section 5.13 |
Litigation |
38 |
| Section 5.14 |
Intellectual Property |
38 |
| Section 5.15 |
Real Property |
40 |
| Section 5.16 |
Material Contracts |
40 |
| Section 5.17 |
Insurance |
41 |
| Section 5.18 |
Brokers |
41 |
| Section 5.19 |
State Takeover Statute |
41 |
| Section 5.20 |
Investment Company Act |
42 |
| Section 5.21 |
Ownership of Company Capital Stock |
42 |
| Section 5.22 |
Business Conduct |
42 |
| Section 5.23 |
Related Party Transactions |
42 |
| Section 5.24 |
FDA Regulatory |
42 |
| Section 5.25 |
No Additional Representations |
44 |
| |
|
|
| Article VI COVENANTS AND AGREEMENTS |
45 |
| |
|
|
| Section 6.1 |
Conduct of Company Business Pending the Merger |
45 |
| Section 6.2 |
[Intentionally Omitted] |
48 |
| Section 6.3 |
[Intentionally Omitted] |
48 |
| Section 6.4 |
Indemnification; Directors’ and Officers’ Insurance |
49 |
| Section 6.5 |
Preparation of Proxy Statement |
51 |
| Section 6.6 |
Shareholders Meeting |
52 |
| Section 6.7 |
Access to Information |
52 |
| Section 6.8 |
Reasonable Best Efforts |
53 |
| Section 6.9 |
Employee Matters |
54 |
| Section 6.10 |
Parent Equity Investment |
54 |
| Section 6.11 |
Shareholder Litigation |
55 |
| Section 6.12 |
Public Announcements |
55 |
| Section 6.13 |
Control of Business |
55 |
| Section 6.14 |
Transfer Taxes |
55 |
| Section 6.15 |
Notification |
56 |
| Section 6.16 |
Use of Company’s Cash Receipts |
56 |
| Section 6.17 |
Takeover Laws |
56 |
| Section 6.18 |
[Intentionally omitted] |
56 |
| Section 6.19 |
Delisting |
56 |
| Section 6.20 |
Obligations of Merger Sub and the Surviving Company |
56 |
| Section 6.21 |
Surviving Company Option Plan |
57 |
| Section 6.22 |
Benefits |
57 |
| Section 6.23 |
Exchange Agreements |
57 |
| |
|
|
| Article VII CONDITIONS PRECEDENT |
57 |
| |
|
|
| Section 7.1 |
Conditions to Each Party’s Obligation to Consummate the Merger |
57 |
| Section 7.2 |
Additional Conditions to Obligations of Parent and Merger Sub |
59 |
| Section 7.3 |
Additional Conditions to Obligations of the Company |
60 |
| Section 7.4 |
Frustration of Closing Conditions |
61 |
| |
|
|
| Article VIII TERMINATION |
61 |
| |
|
|
| Section 8.1 |
Termination |
61 |
| Section 8.2 |
Notice of Termination; Effect of Termination |
62 |
| Section 8.3 |
Expenses and Other Payments |
62 |
| |
|
|
| Article IX GENERAL PROVISIONS |
63 |
| |
|
|
| Section 9.1 |
Disclosure Letter Definitions |
63 |
| Section 9.2 |
Survival |
63 |
| Section 9.3 |
Notices |
63 |
| Section 9.4 |
Rules of Construction |
64 |
| Section 9.5 |
Counterparts |
65 |
| Section 9.6 |
Entire Agreement; Third Party Beneficiaries |
65 |
| Section 9.7 |
Governing Law; Venue; Waiver of Jury Trial |
65 |
| Section 9.8 |
Severability |
66 |
| Section 9.9 |
Assignment |
66 |
| Section 9.10 |
Affiliate Liability |
66 |
| Section 9.11 |
Remedies; Specific Performance |
67 |
| Section 9.12 |
Amendment |
67 |
| Section 9.13 |
Extension; Waiver |
67 |
| Annex A |
Certain Definitions |
|
| |
|
|
| Exhibit A |
Certificate of Incorporation of Surviving Company |
|
| |
|
|
| Exhibit B |
Bylaws of Surviving Company |
|
| |
|
|
| Exhibit C |
Certificate of Designation for Exchanged Parent Preferred Stock |
|
AMENDED AND RESTATED AGREEMENT AND PLAN OF
MERGER
THIS AMENDED AND RESTATED
AGREEMENT AND PLAN OF MERGER, dated as of July 12, 2024 (this “Agreement”), by and among Aditxt, Inc., a Delaware
corporation (“Parent”), Adifem, Inc., formerly known as Adicure, Inc., a Delaware corporation and a wholly-owned Subsidiary
of Parent (“Merger Sub”), and Evofem Biosciences, Inc., a Delaware corporation (the “Company”).
WHEREAS, the Company,
Parent and Merger Sub entered into that certain Agreement and Plan of Merger as of December 11, 2023 (such agreement the “Original
Agreement” and such date the “Original Date”) pursuant to which they planned to effect a business combination
through a merger of Merger Sub with and into the Company, with the Company being the Surviving Company (the “Merger”),
upon the terms and conditions set forth in this Agreement and in accordance with the Delaware General Corporation Law (the “DGCL”);
WHEREAS, on or about
May 2, 2024, in connection with that certain Reinstatement and Fourth Amendment to Merger Agreement dated as of May 2, 2024 between the
Company, Parent and Merger Sub, Parent initiated a wire transfer to the Company to an account previously designated by the Company to
the Parent in the amount of $1,000,000.00 (the “Initial Payment”);
WHEREAS, the Company,
Parent and Merger Sub have determined to amend and restate the Original Agreement on the terms set forth in this Agreement;
WHEREAS, the board
of directors of the Company (the “Company Board”) has unanimously (i) determined that this Agreement and the transactions
contemplated hereby (collectively, the “Transactions”), including the Merger, are in the best interests of the Company
and the Company Shareholders, (ii) adopted and approved this Agreement and declared that the Transactions, including the Merger, are advisable,
(iii) directed that this Agreement and the Transactions, including the Merger, be submitted to the holders of Company Common Stock and
voting Company Preferred Stock for their approval at the Company Shareholders Meeting, and (iv) resolved to recommend that the holders
of Company Common Stock and voting Company Preferred Stock approve this Agreement and the Transactions, including the Merger (such recommendation
made in this clause (iv), the “Company Board Recommendation”);
WHEREAS, the board
of directors of Parent (the “Parent Board”) has unanimously (i) determined that this Agreement and the Transactions,
including the issuance of Exchanged Parent Preferred Stock (the “Parent Stock Issuance”) and the Merger, are in the
best interests of Parent and the Parent Shareholders and (ii) adopted and approved this Agreement and declared that the Transactions,
including the Parent Stock Issuance and the Merger, are advisable;
WHEREAS, Parent, in
its capacity as the sole stockholder of Merger Sub (the “Merger Sub Sole Stockholder”), has by written consent (i)
determined that this Agreement and the Transactions, including the Merger, are in the best interests of Merger Sub and the Merger Sub
Sole Stockholder and (ii) adopted and approved this Agreement and declared that the Transactions, including the Merger, are advisable;
WHEREAS, Baker
Brothers Life Sciences, L.P. (“Baker”), 667, L.P. (“667”), and Baker Bros. Advisors LP as
their designated agent (the “Designated Agent”) have entered into certain debt agreements with the Company (the
agreements representing such existing debt, as amended, the “Loan Documents” and the amount owed by the Company
under the Loan Documents, the “Loan Amount”), including, without limitation, that certain Securities Purchase and
Security Agreement, dated as of April 23, 2020, as amended by that First Amendment to the Securities Purchase and Security
Agreement, dated as of November 20, 2021, that Second Amendment to the Securities Purchase and Security Agreement, dated as of March
21, 2022, that Third Amendment to Securities Purchase and Security Agreement dated as of September 15, 2022, and that Fourth
Amendment to Securities Purchase and Security Agreement, dated as of September 8, 2023 (as so amended, the “Securities
Purchase Agreement”) by and among the Company, the Purchasers (as defined therein) and the Designated Agent; and
WHEREAS, the parties
desire to make certain representations, warranties, covenants and agreements in connection with the Merger and the Parent Stock Issuance,
and to prescribe various terms of and conditions to the Merger.
NOW, THEREFORE, in
consideration of the foregoing and the representations, warranties, covenants and agreements contained in this Agreement, and for other
valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Parent, Merger Sub and the Company hereby agree
as follows:
Article
I
CERTAIN DEFINITIONS
Section 1.1
Certain Definitions. As used in this Agreement, the capitalized terms have the meanings ascribed to such terms in Annex
A or as otherwise defined elsewhere in this Agreement.
Section 1.2
Terms Defined Elsewhere. As used in this Agreement, the following capitalized terms are defined in this Agreement as
referenced in the following table:
| Definition |
|
Section |
| 667 |
|
Recitals |
| Agreement |
|
Preamble |
| Baker |
|
Recitals |
| Book-Entry Shares |
|
3.2(b)(i) |
| Business Employees |
|
4.11(a) |
| Cancelled Shares |
|
3.1(b)(iv) |
| Certificate of Merger |
|
2.2(b) |
| Certificates |
|
3.2(b)(i) |
| Closing |
|
2.2(a) |
| Closing Date |
|
2.2(a) |
| Code |
|
3.2(i) |
| Common Exchange Ratio |
|
3.1(b)(i) |
| Common Merger Consideration |
|
3.1(b)(i) |
| Company |
|
Preamble |
| Company Affiliate |
|
9.10 |
| Company Board |
|
Recitals |
| Company Board Recommendation |
|
Recitals |
| Company Common Stock |
|
3.1(b)(i) |
| Company Contracts |
|
4.16(b) |
| Company Disclosure Letter |
|
Article IV |
| Company Material Adverse Effect |
|
4.1(a) |
| Company Permits |
|
4.9 |
| Company Plans |
|
4.10(a) |
| Company SEC Documents |
|
4.5(a) |
| Company Shareholders Meeting |
|
4.4 |
| Delaware Department |
|
2.2(b) |
| Designated Agent |
|
Recitals |
| Designation |
|
5.3(a) |
| DGCL |
|
Recitals |
| Dissenting Shares |
|
3.2(j) |
| Effective Time |
|
2.2(b) |
| End Date |
|
8.1(b)(ii) |
| Exchange Agent |
|
3.2(a) |
| Exchange Fund |
|
3.2(a) |
| Exchange Ratios |
|
3.1(b)(ii) |
| Exchanged Parent Preferred Stock |
|
3.1(b)(ii) |
| F-1 Preferred Stock |
|
6.10 |
| FDA Permits |
|
4.23(b) |
| GAAP |
|
4.5(b) |
| Letter of Transmittal |
|
3.2(b)(i) |
| Loan Amount |
|
Recitals |
| Loan Documents |
|
Recitals |
| Material Company Insurance Policies |
|
4.17 |
| Material Parent Insurance Policies |
|
5.17 |
| Merger |
|
Recitals |
| Merger Consideration |
|
3.1(b)(ii) |
| Merger Sub |
|
Preamble |
| Merger Sub Sole Stockholder |
|
Recitals |
| Non-Disclosure Agreement |
|
6.7(b) |
| Parent |
|
Preamble |
| Parent Affiliate |
|
9.10(b) |
| Parent Board |
|
Recitals |
| Parent Contracts |
|
5.16(b) |
| Parent Disclosure Letter |
|
Article V |
| Parent Material Adverse Effect |
|
5.1(a) |
| Parent Permits |
|
5.9 |
| Parent Plans |
|
5.10(a) |
| Parent SEC Documents |
|
5.5(a) |
| Parent Stock Issuance |
|
Recitals |
| Pdf |
|
9.5 |
| Potential Product |
|
4.23(c) |
| Preferred Exchange Ratio |
|
3.1(b)(ii) |
| Preferred Merger Consideration |
|
3.1(b)(ii) |
| Proxy Statement |
|
4.4 |
| Securities Purchase Agreement |
|
Recitals |
| Surviving Company |
|
2.1 |
| Terminable Breach |
|
8.1(b)(iii) |
| Transaction Litigation |
|
6.15 |
| Transactions |
|
Recitals |
| Unconverted Company Preferred Stock |
|
3.1(b)(ii) |
Article
II
THE MERGER
Section 2.1
The Merger. Upon the terms and subject to the conditions of this Agreement, and in accordance with the DGCL, at the
Effective Time, the Merger Sub shall be merged with and into Company, with the Company surviving the Merger (the Company, as the surviving
company in the Merger, sometimes being referred to herein as the “Surviving Company”). As a result of the Merger, the
Surviving Company shall be a wholly-owned Subsidiary of Parent. The Merger shall have the effects provided in this Agreement and as specified
in the DGCL.
Section 2.2
Closing.
(a)
The closing of the Merger (the “Closing”), shall take place at 9:00 a.m., New York, New York time, on a date
that is two Business Days following the satisfaction or (to the extent permitted by applicable Law) waiver in accordance with this Agreement
of all of the conditions set forth in Article VII (other than any such conditions which by their nature cannot be satisfied until
the Closing Date, which shall be required to be so satisfied or (to the extent permitted by applicable Law) waived in accordance with
this Agreement on the Closing Date) by means of a virtual closing through the electronic exchange of signatures, or such other date and
place as Parent and the Company may agree to in writing. For purposes of this Agreement, “Closing Date” shall mean
the date on which the Closing occurs.
(b)
As soon as practicable on the Closing Date, Parent and the Company shall (i) cause the Merger to be consummated by filing with
the Secretary of State of the State of Delaware (the “Delaware Department”) a certificate of merger (the “Certificate
of Merger”) in connection with the Merger, in such form as is required by, and executed in accordance with, the DGCL, and (ii)
the parties shall make all other filings or recordings required under the DGCL in connection with the Merger. The Merger shall become
effective at the time of filing of the Certificate of Merger with the Delaware Department, or at such later time as may be designated
jointly by Parent and the Company and specified in the Certificate of Merger (such date and time the Merger becomes effective, the “Effective
Time”), it being understood and agreed that, unless otherwise agreed to by the parties in writing, the Effective Time shall
occur on the Closing Date.
Section 2.3 Effect
of the Merger. At the Effective Time, the Merger shall have the effects set forth in this Agreement and the applicable
provisions of the DGCL. Without limiting the generality of the foregoing, and subject thereto, at the Effective Time, all of the
property, assets, rights, privileges, immunities, purposes, powers and franchises of each of the Company and Merger Sub shall vest
in the Surviving Company without transfer, reversion or impairment and all debts, obligations and liabilities of each of the Company
and Merger Sub shall become the debts, obligations and liabilities of the Surviving Company.
Section 2.4
Organizational Documents. At the Effective Time and by virtue of the Merger, the Organizational Documents of the Surviving
Company shall be amended and restated set forth in Exhibit A and Exhibit B hereto, until thereafter amended in accordance with their respective
terms and applicable Law.
Section 2.5
Directors and Officers of the Surviving Company. From and after the Effective Time, the sole officer of the Surviving
Company is Saundra Pelletier and the director or directors of the Surviving Company shall be as set forth in Section 2.5 of the
Parent Disclosure Letter and such directors and officers shall serve until their successors have been duly elected or appointed and qualified
or until their death, resignation or removal in accordance with the Organizational Documents of the Surviving Company. The Parent and
certain members of Company management are to enter into a mutually agreeable voting agreement (the “Voting Agreement”)
on the Closing Date as hereinafter provided.
Article
III
EFFECT OF THE MERGER ON THE CAPITAL STOCK OF THE COMPANY AND MERGER SUB; EXCHANGE
Section 3.1
Effect of the Merger on Capital Stock. At the Effective Time, by virtue of the Merger and without any action on the
part of Parent, Merger Sub, the Company, or any holder of any securities of Parent, Merger Sub or the Company:
(a)
Capital Stock of Merger Sub. Each issued and outstanding share of Merger Sub Common Stock shall be canceled and retired
and shall cease to exist. Immediately following the Effective Time, the Surviving Company shall issue to Parent a number of shares of
common stock, par value $0.001 per share, of the Surviving Company equal to the number of shares of Merger Sub Common Stock outstanding
immediately prior to the Effective Time upon payment by Parent to the Surviving Company of an amount equal to the product of (x) the number
of shares of the Surviving Company issued to Parent and (y) the par value of such shares.
(b)
Capital Stock of the Company.
(i) Subject
to the other provisions of this Article III, all shares of common stock, par value $0.0001 per share, of the Company
(“Company Common Stock”), issued and outstanding immediately prior to the Effective Time (excluding any Cancelled
Shares and Dissenting Shares), shall automatically be converted into the right to receive from Parent, on a pro rata basis, an
aggregate amount (the “Common Merger Consideration”) equal to (A) ONE MILLION EIGHT HUNDRED THOUSAND DOLLARS
($1,800,000.00) less (B) an amount equal to the product of (x) the number of Dissenting Shares represented by Company Common Stock
and (y) the Common Exchange Ratio. As used in this Agreement, “Common Exchange Ratio” means 1,800,000 divided by
the number of issued and outstanding shares of Company Common Stock issued and outstanding immediately prior to the Effective
Time.
(ii)
Subject to the other provisions of this Article III, each share of the Company’s Series E-1 Preferred Stock issued
and outstanding immediately prior to the Effective Time (excluding any Cancelled Shares and Dissenting Shares) (the “Unconverted
Company Preferred Stock”) shall automatically be converted into the right to receive from Parent, (the “Preferred Merger
Consideration” and, together with the Common Merger Consideration the “Merger Consideration”) one share of
Parent Preferred Stock having substantially the rights, powers and preferences set forth in the form Certificate of Designation attached
hereto as Exhibit C (“Exchanged Parent Preferred Stock”). As used in this Agreement, “Preferred Exchange Ratio”
is one to one. The Common Exchange Ratio and Preferred Exchange Ratio are, together, the “Exchange Ratios.”
(iii)
All such shares of Company Common Stock, and Unconverted Company Preferred Stock when so converted pursuant to Section 3.1(b)(i)
and Section 3.1(b)(ii), shall automatically be cancelled and cease to exist. Each holder of a share of Company Common Stock that
was outstanding immediately prior to the Effective Time (other than Cancelled Shares and Dissenting Shares) shall cease to have any rights
with respect thereto, except the right to receive the Common Merger Consideration to be paid in consideration therefor upon the surrender
of any Certificates or Book-Entry Shares, as applicable, in accordance with Section 3.2. Each holder of a share of Unconverted
Company Preferred Stock that was outstanding immediately prior to the Effective Time (other than Cancelled Shares and Dissenting Shares)
shall cease to have any rights with respect thereto, except the right to receive the Preferred Merger Consideration, in each case, to
be issued or paid in consideration therefor upon the surrender of any Certificates or Book-Entry Shares, as applicable, in accordance
with Section 3.2.
(iv)
All shares of Company Common Stock or Company Preferred Stock held by Parent or Merger Sub or by any wholly-owned Subsidiary of
Parent, Merger Sub or the Company immediately prior to the Effective Time shall automatically be cancelled and retired and shall cease
to exist as of the Effective Time, and no consideration shall be delivered or deliverable in exchange therefor (collectively, the “Cancelled
Shares”).
(c) Adjustment
to Merger Consideration and Exchange Ratios. Each of the Common Merger Consideration and the Preferred Merger Consideration,
respectively, and the Common Exchange Ratio and the Preferred Exchange Ratio, respectively, shall be equitably adjusted, without
duplication, to reflect the effect of any stock split, reverse stock split, stock dividend (including any dividend or other
distribution of securities convertible into such securities), subdivision, reorganization, reclassification, recapitalization,
combination, exchange of shares or other like change with respect to the number of shares of Company Common Stock, Unconverted
Company Preferred Stock or Parent Preferred Stock outstanding after the date hereof and prior to the Effective Time and thereafter
all references to the Common Merger Consideration and Preferred Merger Consideration, respectively, and the Common Exchange Ratio
and the Preferred Exchange Ratio, respectively, as applicable, shall be deemed to be the Common Merger Consideration and the
Preferred Merger Consideration, respectively, and Common Exchange Ratio and Preferred Exchange Ratio, respectively, as so adjusted.
The same procedures shall apply to any other reference to the issuance of Parent Preferred Stock pursuant to this Agreement. Nothing
in this Section 3.1(c) shall be construed to permit the Company, Parent or any of their respective Subsidiaries to take any
action with respect to its securities that is prohibited by the terms of this Agreement.
(d)
Company Options. Upon the terms and subject to the conditions set forth herein, at the Effective Time, by virtue of the
Merger and without any action on the part of any party hereto, any Company Optionholder or any other Person, each Company Option that
is outstanding and unexercised as of immediately prior to the Effective Time shall, whether or not vested, be automatically extinguished
and canceled without the right to receive any consideration (with no payment being made hereunder with respect thereto). Prior to the
Effective Time, the Company shall take all actions necessary and sufficient in accordance with applicable Law, the Company Option Plans
and the Company Options including obtaining necessary consents and passing necessary resolutions of its board of directors) to: (A) give
effect to the actions contemplated by this Section 3.1(d), and (B) terminate, as of the Effective Time, the Company Option Plans,
all agreements pursuant thereto and all Company Options thereunder, such that as of the Effective Time, no Person shall have any right
to purchase shares of Company Common Stock or any right to receive Company Common Stock or any other equity security of the Company thereunder.
The Company shall take all actions necessary to effect the transactions contemplated by this Section 3.1(d), including, but not
limited to, any actions as may be required under the applicable Company Option Plans and all Company Options, including, if required by
the Company Option Plans or Company Options, delivering a notice of the terms of this Agreement to all holders of Company Options. Any
materials to be submitted to holders of Company Options shall be subject to review by Parent.
(e) ESPP.
As of the date of this Agreement, no employee of the Company is participating in the ESPP, and there are no ongoing offering periods
under the ESPP, and the Company shall not permit any new offering period following the date of this Agreement. As soon as
practicable after the date of this Agreement, the Company shall take all action that may be reasonably necessary to terminate the
ESPP, subject to consummation of the Merger, no later than no later than five Business Days prior to the anticipated Closing Date.
As soon as practicable after the date of this Agreement, the Company shall take all action that may be reasonably necessary to
provide that: (i) no new Offering Period shall commence under the Company’s 2019 Employee Stock Purchase Plan
(“ESPP”) following the date of this Agreement, (ii) participants in the ESPP as of the date of this Agreement may
not increase their payroll deductions under, or make separate non-payroll contributions to, the ESPP from those in effect on the
date of this Agreement; and (iii) no new participants may commence participation in the ESPP following the date of this Agreement.
Prior to the Effective Time, the Company shall take all action that the Company determines to be reasonably necessary to: (A) cause
any offering period or purchase period that otherwise would be in progress at the Effective Time to be the final offering period
under the ESPP and to be terminated no later than five Business Days prior to the anticipated Closing Date (the “Final
Exercise Date”); (B) make any pro-rata adjustments that may be necessary to reflect the shortened offering period or
purchase period, but otherwise treat such shortened offering period or purchase period as a fully effective and completed offering
period or purchase period for all purposes under the ESPP; (C) cause each participant’s then-outstanding share purchase right
under the ESPP (the “ESPP Rights”) to be exercised as of the Final Exercise Date; and (D) terminate the ESPP as
of, and contingent upon, the Effective Time. On the Final Exercise Date, the funds credited as of such date under the ESPP within
the associated accumulated account for each participant under the ESPP shall be used to purchase shares of Company Common Stock in
accordance with the terms of the ESPP (as amended pursuant to this Section 3.2(e)), and each share purchased thereunder
immediately prior to the Effective Time will be canceled at the Effective Time and converted into the right to receive the Common
Merger Consideration in accordance with Section 3.1(b), subject to withholding of any applicable income and employment
withholding Taxes. Any accumulated contributions of each participant under the ESPP as of immediately prior to the Effective Time
shall, to the extent not used to purchase shares in accordance with the terms and conditions of the ESPP (as amended pursuant to
this Section 3.2(e)), be refunded to such participant as promptly as practicable following the Effective Time (without
interest). No further ESPP Rights shall be granted or exercised under the ESPP after the Final Exercise Date. The Company shall
provide timely notice to participants of the setting of the Final Exercise Date and the termination of the ESPP in accordance with
the terms thereof.
Section 3.2
Payment for Securities; Exchange.
(a)
Exchange Agent; Exchange Fund. Prior to the Closing Date, Parent and Merger Sub shall enter into an agreement with the Company’s
transfer agent to act as agent for the holders of Company Common Stock and the Unconverted Company Preferred Stock in connection with
the Merger (the “Exchange Agent”) and to receive the Merger Consideration and any dividends or other distributions
pursuant to Section 3.2(g), to which such holders shall become entitled pursuant to this Article III. On or prior to the
Closing Date and prior to the Effective Time, Parent or Merger Sub shall deposit, or cause to be deposited, with the Exchange Agent, for
the benefit of the holders of shares of Company Common Stock and Unconverted Company Preferred Stock for payment or issuance in accordance
with this Article III through the Exchange Agent, the cash payable to the holders of Company Common Stock and the number of shares
of Exchanged Parent Preferred Stock as provided in Section 3.1 issuable to holders of the Unconverted Company Preferred Stock,
in each case outstanding immediately prior to the Effective Time pursuant to Section 3.1. Parent agrees to deposit with the Exchange
Agent, from time to time as needed, cash sufficient to pay any dividends and other distributions pursuant to Section 3.2(g) and,
in the event there are insufficient funds to make the payments contemplated by this Article III, additional cash in an amount which
is equal to the deficiency in an amount required to make such payments in full. Parent shall instruct the Exchange Agent to, pursuant
to irrevocable instructions, deliver the Merger Consideration contemplated to be issued in exchange for shares of Company Common Stock
and Unconverted Company Preferred Stock, respectively, pursuant to this Agreement out of the Exchange Fund. Except as contemplated by
this Section 3.2(a), Section 3.2(g) and Section 3.2(h), the Exchange Fund shall not be used for any other purpose.
Any cash and shares of Exchanged Parent Preferred Stock deposited with the Exchange Agent and any dividends or other distributions in
accordance with Section 3.2(g) shall be referred to herein as the “Exchange Fund.” The Surviving Company shall
pay all charges and expenses, including those of the Exchange Agent, in connection with the exchange of shares of Company Common Stock
and Unconverted Company Preferred Stock, respectively, for the Merger Consideration. Any interest or other income resulting from investment
of the cash portion of the Exchange Fund shall become part of the Exchange Fund.
(b)
Exchange Procedures.
(i)
Parent shall instruct the Exchange Agent to, as soon as practicable after the Effective Time, but in no event more than two Business
Days after the Closing Date, mail or otherwise deliver to each record holder, as of immediately prior to the Effective Time, of (A) a
certificate or certificates that immediately prior to the Effective Time represented shares of Company Common Stock or Unconverted Company
Preferred Stock (the “Certificates”) or (B) shares of Company Common Stock or Unconverted Company Preferred Stock represented
by book-entry (“Book-Entry Shares”), in each case, which shares were converted pursuant to Section 3.1 into
the right to receive the Merger Consideration at the Effective Time, (1) a letter of transmittal (“Letter of Transmittal”),
which shall specify that delivery shall be effected, and risk of loss and title to the Certificates shall pass, only upon proper delivery
of the Certificates to the Exchange Agent or, in the case of Book-Entry Shares, upon adherence to the procedures set forth in the Letter
of Transmittal, and which shall be in a customary form and agreed to by Parent and the Company prior to the Closing (it being understood
that the forms of Letter of Transmittal to be mailed to the holders of Company Common Stock and Unconverted Company Preferred Stock may
vary in certain respects due to differences in the respective securities) and (2) instructions for use in effecting the surrender of the
Certificates or, in the case of Book-Entry Shares, the surrender of such shares, for payment of the Merger Consideration set forth in
Section 3.1.
(ii) Upon
surrender to the Exchange Agent of a Certificate or Book-Entry Shares, together with the Letter of Transmittal (or, in the case of
Book-Entry Shares, by book-receipt of an “agent’s message” by the Exchange Agent or such other evidence, if
any, required to be obtained by the Exchange Agent in connection with the surrender of Book-Entry Shares), duly completed and
validly executed in accordance with the instructions thereto, and such other customary documents as may be reasonably required by
the Exchange Agent, the holder of such Certificate or Book-Entry Shares shall be entitled to receive in exchange therefor (A) the
Merger Consideration pursuant to the provisions of this Article III (which shares of Exchanged Parent Preferred Stock shall
be in uncertificated book-entry form) and (B) a check or wire transfer in the amount equal to any dividends and other distributions
pursuant to Section 3.2(g). No interest shall be paid or accrued for the benefit of holders of the Certificates or Book-Entry
Shares on the Merger Consideration payable in respect of the Certificates or Book-Entry Shares. If payment of the Merger
Consideration is to be made to a Person other than the record holder of such shares of Company Common Stock or Unconverted Company
Preferred Stock, it shall be a condition of payment that shares so surrendered shall be properly endorsed or shall be otherwise in
proper form for transfer and that the Person requesting such payment shall have paid any transfer and other Taxes required by reason
of the payment of the Merger Consideration to a Person other than the registered holder of such shares surrendered or shall have
established to the satisfaction of the Surviving Company that such Taxes either have been paid or are not applicable. Until
surrendered as contemplated by this Section 3.2(b)(ii), each Certificate and each Book-Entry Share shall be deemed at any
time after the Effective Time to represent only the right to receive upon such surrender the Merger Consideration payable in respect
of such shares of Company Common Stock or Unconverted Company Preferred Stock, and any dividends or other distributions to which
such holder is entitled pursuant to Section 3.2(g).
(c)
Termination of Rights. All Merger Consideration and any dividends or other distributions with respect to Exchanged Parent
Preferred Stock pursuant to Section 3.2(g), in each case paid upon the surrender of and in exchange for shares of Company Common
Stock or Unconverted Company Preferred Stock, respectively, in accordance with the terms hereof shall be deemed to have been paid in full
satisfaction of all rights pertaining to such Company Common Stock and Unconverted Company Preferred Stock, respectively. At the Effective
Time, the stock transfer books of the Company shall be closed, and there shall be no further registration of transfers on the stock transfer
books of the Company of the shares of Company Common Stock or Unconverted Company Preferred Stock that were outstanding immediately prior
to the Effective Time. If, after the Effective Time, Certificates or Book-Entry Shares are presented to the Exchange Agent or the Surviving
Company for any reason, they shall be cancelled and exchanged for the Merger Consideration payable in respect of the shares of Company
Common Stock or Unconverted Company Preferred Stock, respectively, previously represented by such Certificates or Book-Entry Shares (other
than Certificates or Book-Entry Shares evidencing Cancelled Shares and Dissenting Shares) and any dividends or other distributions to
which the holders thereof are entitled pursuant to Section 3.2(g), without any interest thereon.
(d)
Termination of Exchange Fund. Any portion of the Exchange Fund that remains undistributed to the former Company Shareholders
on the 365th day after the Closing Date shall be delivered to the Surviving Company upon demand, and any former Company Shareholders who
have not theretofore received the Merger Consideration to which they are entitled under this Article III and any dividends or other
distributions with respect to Exchanged Parent Preferred Stock to which they are entitled pursuant to Section 3.2(g), in each case
without interest thereon, shall thereafter look only to the Surviving Company and Parent for payment of their claim for such amounts.
(e)
No Liability. None of the Surviving Company, Parent or the Exchange Agent shall be liable to any holder of a Certificate
or Book-Entry Share for any Merger Consideration, or other amounts properly delivered to a public official pursuant to any applicable
abandoned property, escheat or similar Law. If any Certificate or Book-Entry Share has not been surrendered prior to the time that is
immediately prior to the time at which the Merger Consideration in respect of such Certificate or Book-Entry Share would otherwise escheat
to or become the property of any Governmental Entity, any such shares, cash, dividends or distributions in respect of such Certificate
or Book-Entry Share shall, to the extent permitted by applicable Law, become the property of the Surviving Company, free and clear of
all claims or interest of any Person previously entitled thereto.
(f) Lost,
Stolen or Destroyed Certificates. If any Certificate (other than a Certificate evidencing Cancelled Shares) shall have been
lost, stolen or destroyed, upon the making of an affidavit of that fact by the Person claiming such Certificate to be lost, stolen
or destroyed and, if reasonably required by the Surviving Company, the posting by such Person of a bond in such reasonable amount,
pursuant to the policies and procedures of the transfer agent for Parent, as the Surviving Company may direct as indemnity against
any claim that may be made against it with respect to such Certificate, Parent shall instruct the Exchange Agent to issue in
exchange for such lost, stolen or destroyed Certificate the Merger Consideration payable in respect of the shares of Company Common
Stock or Unconverted Company Preferred Stock, respectively, formerly represented by such Certificate and any dividends or other
distributions with respect to Exchanged Parent Preferred Stock, respectively, to which the holders thereof are entitled pursuant to Section
3.2(g).
(g)
Distributions with Respect to Exchanged Parent Preferred Stock. No dividends or other distributions declared or made with
respect to shares of Exchanged Parent Preferred Stock with a record date after the Effective Time shall be paid to the holder of any Certificate
or Book-Entry Shares not surrendered with respect to the whole shares of Exchanged Parent Preferred Stock that such holder would be entitled
to receive upon surrender of such Certificate or Book-Entry Shares until such holder shall surrender such Certificate or Book-Entry Shares
in accordance with this Section 3.2. Following surrender of any such Certificate or Book-Entry Shares, there shall be paid to such
holder of whole shares of Exchanged Parent Preferred Stock issuable in exchange therefor, without interest, (i) promptly after the time
of such surrender, the amount of any dividends or other distributions with a record date after the Effective Time theretofore paid with
respect to such whole shares of Exchanged Parent Preferred Stock to which such holder is entitled pursuant to this Agreement, and (ii)
at the appropriate payment date, the amount of any dividends or other distributions with a record date after the Effective Time but prior
to such surrender and with a payment date subsequent to such surrender payable with respect to such whole shares of Exchanged Parent Preferred
Stock. For purposes of dividends or other distributions in respect of shares of Exchanged Parent Preferred Stock all whole shares of Exchanged
Parent Preferred Stock to be issued pursuant to the Merger shall be entitled to dividends pursuant to the immediately preceding sentence
as if such whole shares of Exchanged Parent Preferred Stock were issued and outstanding as of the Effective Time.
(h)
Fractional Shares of Parent Preferred Stock. Any fractional shares of Parent Preferred Stock issuable under the terms of
this Agreement shall be issued as fractional shares of Parent Preferred Stock, and the holders thereof shall not be entitled to any cash
consideration therefor in connection with the Merger.
(i)
Withholding Taxes. Notwithstanding anything in this Agreement to the contrary, Parent, the Surviving Company and the Exchange
Agent shall be entitled to deduct and withhold from (i) the consideration to be paid by Parent, the Surviving Company or the Exchange
Agent hereunder and (ii) any other amounts otherwise payable pursuant to this Agreement, any amount required to be deducted and withheld
with respect to the making of such payment under the Internal Revenue Code (the “Code”) or any other provision of state,
local or foreign Tax Law. Before making any such deduction or withholding (other than with respect to amounts payable pursuant to this
Agreement that are treated as compensatory for Tax purposes or in respect of a failure to deliver any necessary tax forms), the withholding
party shall provide the chief executive officer of the Company with reasonable advance written notice of the intent to make such deduction
or withholding, including a description of the legal and factual basis in support of any such deduction or withholding, and the withholding
party shall cooperate with any reasonable request from the chief executive officer of the Company to reduce or eliminate such deduction
or withholding (on behalf of the applicable individual or entity) to the extent permitted by Law. Any such amounts so deducted or withheld
shall be treated for all purposes of this Agreement as having been paid to the Person in respect of which such deduction or withholding
was made.
(j)
Dissenting Shares. Notwithstanding anything in this Agreement to the contrary, any Company Capital Stock outstanding immediately
prior to the Effective Time and held by a Company Shareholder who has not voted in favor of or consented to the adoption of this Agreement
and who is entitled to demand and has properly demanded appraisal for such Company Capital Stock in accordance with the DGCL, and who,
as of the Effective Time, has not effectively withdrawn or lost such appraisal rights (such Company Capital Stock, “Dissenting
Shares”) shall not be converted into or be exchangeable for the right to receive a portion of the Merger Consideration and,
instead, shall be entitled to only those rights as set forth in the DGCL. If, after the Effective Time, any such holder fails to perfect
or withdraws or loses his, her or its right to appraisal under the DGCL, with respect to any Dissenting Shares, upon surrender of the
certificate(s) representing such Dissenting Shares, such Dissenting Shares shall thereupon be treated as if they had been converted as
of the Effective Time into the right to receive the portion of the Merger Consideration, if any, to which such Company Capital Stock is
entitled pursuant to Section 3.1(b), without interest. Parent shall direct all negotiations and proceedings with respect to the
exercise of such appraisal rights under the DGCL.
Article
IV
REPRESENTATIONS AND WARRANTIES OF THE COMPANY
Except as set forth in the
disclosure letter delivered by the Company to Parent and Merger Sub on or prior to the Original Date of this Agreement (the “Company
Disclosure Letter”) and except as disclosed in the Company SEC Documents filed or furnished with the SEC and publicly available
on EDGAR at least two (2) Business Days prior to the Original Date (including all exhibits and schedules thereto and documents incorporated
by reference therein, but excluding any forward-looking disclosures set forth in any “risk factors” section, any disclosures
in any “forward looking statements” section and any other disclosures included therein to the extent they are predictive
or forward looking in nature), the Company acknowledges that, as of such Original Date, it represented and warranted to Parent and Merger
Sub as follows, which representations and warranties, unless modified by this Agreement (which modification may include deletion of such
representation or warranty), remain in effect, but solely to the extent made in the Original Agreement, without novation, notwithstanding
the repetition thereof in this Agreement. All references in Article IV of this Agreement to the “date of this Agreement,”
the “date hereof,” or similar wording shall be deemed to refer to the date of the Original Agreement, and any representation
or warranty stated in the present tense, regardless of its repetition in Article IV of this Agreement, shall be read to apply solely
in the past tense as of the Original Date. Representations and warranties made with respect to the occurrence or non-occurrence of an
event or set of facts since a certain date shall likewise solely apply from such prior date through the Original Date:
Section 4.1
Organization, Standing and Power.
(a) Each
of the Company and its Subsidiaries is, as applicable, a corporation, a trust, general or limited partnership or limited liability
company duly organized, validly existing and, where relevant, in good standing under the Laws of its jurisdiction of incorporation
or organization, with all requisite entity power and authority to own, lease and, to the extent applicable, operate its respective
properties and to carry on its respective business as now being conducted, other than, in each case, where the failure to be so
organized, validly existing, in good standing or to have such power or authority would not reasonably be expected to have,
individually or in the aggregate, a Material Adverse Effect on the Company (a “Company Material Adverse Effect”).
Each of the Company and its Subsidiaries is duly qualified or licensed to do business and, where relevant, is in good standing in
each jurisdiction in which the business it is conducting requires such qualification or license, other than where the failure to so
qualify, be licensed or in good standing would not reasonably be expected to have, individually or in the aggregate, a Company
Material Adverse Effect. The Company has heretofore made available to Parent complete and correct copies of its Organizational
Documents.
(b)
Section 4.1(b) of the Company Disclosure Letter sets forth an accurate and complete list of each Subsidiary of the Company,
together with (i) the jurisdiction of incorporation or organization, as the case may be, of such Subsidiary, (ii) the type and percentage
of interest held, directly or indirectly, by the Company in such Subsidiary, (iii) the amount of its authorized capital stock or other
equity interests and (iv) the amount of its outstanding capital stock or other equity interests.
(c)
Section 4.1(c) of the Company Disclosure Letter sets forth an accurate and complete list of Persons, other than the Subsidiaries
of the Company, in which the Company or any Subsidiary of the Company has a direct equity interest and a description of such interest.
Section 4.2
Capital Structure.
(a)
As of December 10, 2023, the authorized capital stock of the Company consists of (i) 3,000,000,000 shares of Company Common Stock
and (ii) 5,000,000 shares of Company Preferred Stock. At the close of business on November 13, 2023: (A) 10,730,210 shares of Company
Common Stock were issued and outstanding; (B) 1,800 shares of the Company Series E-1 Preferred Stock were issued and outstanding; (C)
9,535 shares of Company Common Stock were reserved and available for issuance pursuant to the Company 2014 Equity Incentive Plan; (D)
609 shares of Company Common Stock were reserved and available for issuance pursuant to the Company’s 2018 Inducement Equity Incentive
Plan; (E) 509 shares of Company Common Stock were reserved and available for issuance pursuant to the Company’s 2019 Employee Stock
Purchase Plan; (F) 449,643,423 shares of Company Common Stock were reserved for issuance in connection with the conversion of the Company
Convertible Notes; (F) 32,639,382 shares of Company Common Stock were reserved for issuance in connection with the exercise of the Company
Warrants; and (G) 278,137,667 shares of Company Common Stock were reserved for issuance in connection with the exercise of the Company
Purchase Rights. Except as set forth in this Section 4.2, at the close of business on November 13, 2023, there are no other shares
of outstanding Company Capital Stock issued, reserved for issuance or outstanding.
(b) All
outstanding shares of Company Capital Stock are duly authorized, validly issued, fully paid and nonassessable and are not subject to
preemptive rights. All outstanding shares of Company Capital Stock have been issued and granted in compliance in all material
respects with applicable state and federal securities Laws, the DGCL and the Organizational Documents of the Company. The Company
owns, of record and beneficially, directly or indirectly, all of the issued and outstanding shares of capital stock of, or other
equity interests in, the Subsidiaries of the Company, free and clear of all Liens, other than Permitted Liens. As of the close of
business on December 7, 2023, except as set forth in this Section 4.2 and the Organizational Documents of the Company, except
for stock grants or other awards granted in accordance with Section 6.1(b) and except for the Company Warrants and Company
Convertible Notes, there are no outstanding: (i) shares of Company Capital Stock; (ii) Voting Debt; (iii) securities of the
Company or any Subsidiary of the Company convertible into or exchangeable or exercisable for shares of Company Capital Stock or
Voting Debt; (iv) contractual obligations of the Company or any Subsidiary of the Company to repurchase, redeem or otherwise acquire
any shares of Company Capital Stock or capital stock, membership interests, partnership interests, joint venture interests or other
equity interests of any Subsidiary of the Company; or (v) subscriptions, options, warrants, calls, puts, rights of first refusal or
other rights (including preemptive rights), commitments or agreements to which the Company or any Subsidiary of the Company is a
party or by which it is bound, in any case, obligating the Company or any Subsidiary of the Company to (A) issue, deliver, transfer,
sell, purchase, redeem or acquire, or cause to be issued, delivered, transferred, sold, purchased, redeemed or acquired, additional
shares of Company Capital Stock, any Voting Debt or other voting securities of the Company or (B) grant, extend or enter into any
such subscription, option, warrant, call, put, right of first refusal or other similar right, commitment or agreement. Except as set
forth in the Organizational Documents of the Company, there are no shareholder agreements, voting trusts or other agreements to
which the Company is a party or by which it is bound relating to the voting of any shares of the Company Capital Stock.
(c)
All dividends or other distributions on the shares of Company Capital Stock and any material dividends or other distributions on
any securities of any Subsidiary of the Company which have been authorized or declared prior to the date hereof have been paid in full
(except to the extent such dividends or distributions have been declared and are not yet due and payable). As of the date of this Agreement,
there are no declared and unpaid dividends with respect to any shares of Company Capital Stock or declared and unpaid material dividends
with respect to any securities of any Subsidiary of the Company (including any material dividends payable to the Company from a Subsidiary
of the Company).
Section 4.3
Authority; No Violations; Approvals.
(a) The
Company has all requisite corporate power to execute and deliver this Agreement and to perform its obligations hereunder, subject,
with respect to the consummation of the Merger, to clauses (i) through (ii) below. The execution, delivery and
performance of this Agreement by the Company and the consummation by the Company of the Transactions, including the consummation of
the Merger, have been duly and validly authorized by all necessary corporate action on the part of the Company, subject, with
respect to consummation of the Merger, to (i) receipt of the Company Shareholder Approval and (ii) the filing of the Certificate of
Merger with, and acceptance for record by, the Delaware Department. This Agreement has been duly executed and delivered by the
Company and, assuming the due and valid execution of this Agreement by Parent and Merger Sub, constitutes a valid and legally
binding obligation of the Company enforceable against the Company in accordance with its terms, subject, as to enforceability, to
bankruptcy, insolvency, reorganization, moratorium and other Laws of general applicability relating to or affecting creditors’
rights and to general principles of equity regardless of whether such enforceability is considered in a Proceeding in equity or at
law (collectively, “Creditors’ Rights”). The Company Board, at a meeting duly called and held, (A)
determined that this Agreement and the Transactions, including the Merger, are in the best interests of the Company and the Company
Shareholders, (B) adopted and approved this Agreement and declared that the Transactions, including the Merger, are advisable, (C)
directed that the Merger and the other Transactions be submitted to the holders of Company Common Stock for consideration at the
Company Shareholders Meeting and (D) made the Company Board Recommendation. As of the date hereof, none of the foregoing actions by
the Company Board have been rescinded, withdrawn or modified in any way. The Company Shareholder Approval is the only vote of the
holders of any class or series of the Company Capital Stock that is necessary to approve the Merger and the other Transactions.
(b)
Except as set forth in Section 4.3(b) of the Company Disclosure Letter, the execution and delivery of this Agreement does
not, and the consummation of the Transactions will not (with or without notice or lapse of time, or both) (i) assuming that the Company
Shareholder Approval is obtained, contravene, conflict with or result in a violation of any provision of the Organizational Documents
of the Company, (ii) result in a violation of, or default under, or acceleration of any material obligation or the loss of a material
benefit under, or result in the creation of any Lien upon any of the properties or assets of the Company or any of its Subsidiaries under,
any provision of any Company Contract to which the Company or any of its Subsidiaries is a party or by which the Company or any of its
Subsidiaries or their respective properties or assets are bound, or (iii) assuming the Consents referred to in Section 4.4 are
duly and timely obtained or made and the Company Shareholder Approval has been obtained, contravene, conflict with or result in a violation
of any Law applicable to the Company or any of its Subsidiaries or any of their respective properties or assets, other than, in the case
of clauses (ii) and (iii), any such contraventions, conflicts, violations, defaults, acceleration, losses, or Lien that
would not reasonably be expected to have, individually or in the aggregate, a Company Material Adverse Effect.
Section 4.4
Consents. Except as set forth in Section 4.4 of the Company Disclosure Letter, no Consent from any Governmental
Entity is required to be obtained or made by the Company, any of its Subsidiaries or any of the Persons set forth in Section 4.1(c)
of the Company Disclosure Letter in connection with the execution and delivery of this Agreement by the Company or the consummation by
the Company of the Transactions, except for: (a) the filing with the SEC of a proxy statement in preliminary and definitive form (including
any amendments or supplements, the “Proxy Statement”) relating to the meeting of the Company Shareholders to consider
the approval of this Agreement, the Merger and the other Transactions (including any postponement, adjournment or recess thereof, the
“Company Shareholders Meeting”) and (ii) such reports under the Exchange Act and the Securities Act, and such
other compliance with the Exchange Act and the Securities Act and the rules and regulations thereunder, as may be required in connection
with this Agreement and the Transactions; (b) the filing of the Certificate of Merger and any other required filings with, and the acceptance
for record by, the Delaware Department pursuant to the DGCL; (c) such filings as may be required under the rules and regulations of NASDAQ;
(d) such filings and approvals as may be required by any applicable state securities or “blue sky” Laws or Takeover
Laws; and (e) any such Consent that the failure to obtain or make would not reasonably be expected to have, individually or in the aggregate,
a Company Material Adverse Effect.
Section 4.5
SEC Documents; Financial Statements; Internal Controls and Procedures.
(a)
Since December 31, 2021, the Company has filed or furnished with the SEC all forms, reports, schedules and statements required
to be filed or furnished under the Securities Act or the Exchange Act, respectively (such forms, reports, schedules and statements, as
amended, collectively, the “Company SEC Documents”). As of their respective filing dates, or, if amended prior to the
date hereof, as of the date of (and giving effect to) the last such amendment made prior to the date hereof, each of the Company SEC Documents
complied as to form in all material respects with the applicable requirements of the Securities Act or the Exchange Act, as the case may
be, and the rules and regulations of the SEC thereunder applicable to such Company SEC Documents, and none of the Company SEC Documents
contained, when filed or, if amended prior to the date of this Agreement, as of the date of such amendment with respect to those disclosures
that are amended, any untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary
to make the statements therein, in light of the circumstances under which they were made, not misleading.
(b)
The consolidated audited and unaudited interim financial statements of the Company included or incorporated by reference in the
Company SEC Documents, including all notes and schedules thereto, complied in all material respects, when filed or if amended prior to
the date of this Agreement, as of the date of such amendment, with the rules and regulations of the SEC with respect thereto, were prepared
in accordance with generally accepted accounting principles in the United States (“GAAP”) applied on a consistent basis
during the periods indicated (except as may be indicated in the notes thereto or, in the case of the unaudited statements, as permitted
by Rule 10-01 of Regulation S-X of the SEC) and fairly present in all material respects in accordance with applicable requirements of
GAAP (subject, in the case of the unaudited interim financial statements, to normal year-end audit adjustments) the consolidated financial
position, results of operations, shareholders’ equity and cash flows of the Company and its Subsidiaries, as of the respective dates
thereof and for the respective periods indicated therein (subject, in the case of unaudited interim financial statements, to absence of
notes and normal year-end adjustments). To the knowledge of the Company, as of the date hereof, none of the Company SEC Documents is the
subject of ongoing SEC review and the Company does not have outstanding and unresolved comments from the SEC with respect to any of the
Company SEC Documents. As of the date hereof, none of the Company SEC Documents is the subject of any confidential treatment request by
the Company.
(c)
Except as set forth in Section 4.5(c) of the Company Disclosure Letter and other than any off-balance sheet arrangements
disclosed in the Company SEC Documents filed or furnished prior to the date hereof, neither the Company nor any Subsidiary of the Company
is a party to, or has any contract to become a party to, any joint venture, off-balance sheet partnership or any similar contractual arrangement,
including any off-balance sheet arrangements (as described in Instruction 8 to Item 303(b) of Regulation S-K of the SEC) where the purpose
of such contract is to avoid disclosure of any material transaction involving, or material liabilities of, the Company in the Company’s
published financial statements or any Company SEC Documents.
(d) The
Company has established and maintains disclosure controls and procedures and a system of internal controls over financial reporting
(as such terms are defined in Rule 13a-15 and Rule 15d-15 under the Exchange Act) as required by the Exchange Act. From January 1,
2023, to the date of this Agreement, the Company’s auditors and the Company Board have not been advised of (i) any significant
deficiencies or material weaknesses in the design or operation of internal controls over financial reporting that are reasonably
likely to adversely affect in any material respect the Company’s ability to record, process, summarize and report financial
information or (ii) any fraud, whether or not material, that involves management or other employees who have a significant role in
the Company’s internal controls over financial reporting, and, in each case, neither the Company nor any of its
Representatives has failed to disclose such information to the Company’s auditors or the Company Board.
Section 4.6
Absence of Certain Changes or Events.
(a)
From January 1, 2023, through the date of this Agreement, there has not been any event, change, effect or development that hasn’t
been publicly disclosed, and that, individually or in the aggregate, has had or would reasonably be expected to have a Company Material
Adverse Effect.
(b)
From January 1, 2023, through the date of this Agreement, except for events giving rise to, and the discussion and negotiation
of and other actions taken in connection with, this Agreement, the Company and each of its Subsidiaries have conducted their business
in the ordinary course of business in all material respects.
Section 4.7
No Undisclosed Material Liabilities. There are no liabilities of the Company or any of its Subsidiaries of any kind
whatsoever, whether accrued, contingent, absolute, determined, determinable or otherwise, other than: (a) liabilities reflected or reserved
against on the consolidated balance sheet of the Company dated as of December 31, 2022 (including the notes thereto) contained in the
Company SEC Documents filed or furnished prior to the date hereof; (b) liabilities incurred in the ordinary course of business subsequent
to December 31, 2022; (c) liabilities incurred in connection with the preparation, negotiation and consummation of the Transactions;
(d) liabilities incurred as permitted under Section 6.1(b)(xi); and (e) liabilities that would not reasonably be expected to have,
individually or in the aggregate, a Company Material Adverse Effect.
Section 4.8
[Intentionally omitted]
Section 4.9 Company
Permits; Compliance with Applicable Law. Except as set forth in Section 4.9 of the Company Disclosure Letter, the
Company and its Subsidiaries hold all permits, licenses, franchises, variances, exemptions, orders and approvals of all Governmental
Entities necessary for the lawful conduct of their respective businesses (the “Company Permits”), except where
the failure to so hold would not reasonably be expected to have, individually or in the aggregate, a Company Material Adverse
Effect. The Company and its Subsidiaries are in compliance with the terms of the Company Permits, except where the failure to so
comply would not reasonably be expected to have, individually or in the aggregate, a Company Material Adverse Effect. Neither the
Company nor any Subsidiary of the Company is in violation or breach of, or default under, any Company Permit, nor has the Company or
any Subsidiary of the Company received any claim or notice indicating that the Company or any Subsidiary of the Company is currently
not in compliance with the terms of any Company Permits, except for violations, breaches and defaults, and failures to be in
compliance with the terms of any Company Permits that would not reasonably be expected to have, individually or in the aggregate, a
Company Material Adverse Effect. The businesses of the Company and its Subsidiaries are not currently being conducted, and at no
time since January 1, 2022, have been conducted, in violation of any applicable Law, except for violations that would not reasonably
be expected to have, individually or in the aggregate, a Company Material Adverse Effect. As of the date of this Agreement, no
investigation or review by any Governmental Entity with respect to the Company or any of its Subsidiaries is pending or, to the
knowledge of the Company, threatened, other than those the outcome of which would not reasonably be expected to have, individually
or in the aggregate, a Company Material Adverse Effect. Notwithstanding anything to the contrary in this Section 4.9, the
provisions of this Section 4.9 shall not apply to matters addressed in Sections 4.10, 4.11 or 4.12.
Section 4.10
Compensation; Benefits.
(a)
Set forth in Section 4.10(a) of the Company Disclosure Letter is a list, as of the date hereof, of all of the Employee Benefit
Plans sponsored, maintained, contributed to, or required to be contributed to by the Company or any of its Subsidiaries or with respect
to which the Company or any of its Subsidiaries has, or could reasonably be expected to have, any material liability (such Employee Benefit
Plans, and whether or not material, the “Company Plans”). True, correct and complete copies of each of the Company
Plans (or, in the case of any unwritten Company Plan, a written description thereof) and any amendments thereto and, as applicable, the
most current versions of any related trust agreements, insurance contracts or other funding arrangements, favorable determination or opinion
letters, and the most recent report on Form 5500 and summary plan description with respect to each such Company Plan, in each case, have
been furnished or made available to Parent or its Representatives.
(b)
Each Company Plan has been administered, funded (if applicable) and maintained in compliance with its terms and all applicable
Laws.
(c)
Each Company Plan that is intended to be a “qualified plan” within the meaning of Section 401(a) of the Code
has received a favorable determination letter, or may rely on a favorable opinion letter, issued by the IRS, and to the knowledge of the
Company, no events have occurred that would reasonably be expected to result in any such letter being revoked or in the loss of the qualified
status of any such Company Plan.
(d)
As of the date of this Agreement, there are no actions, suits or claims pending (other than routine claims for benefits) or, to
the knowledge of the Company, threatened against, or with respect to, any of the Company Plans, except for such pending actions, suits
or claims that would not reasonably be expected to have, individually or in the aggregate, a Company Material Adverse Effect.
(e)
All material contributions required to be made to the Company Plans pursuant to their terms have been timely made.
(f)
There are no material unfunded benefit obligations with respect to any Company Plan that have not been properly accrued for in
the Company’s financial statements or disclosed in the notes thereto in accordance with GAAP.
(g) None
of the Company, any of its Subsidiaries, or any of their respective ERISA Affiliates, contributes to, has an obligation to
contribute to or otherwise has any liability (actual or contingent) with respect to, and no Company Plan is, a plan subject to Title
IV of ERISA (including a multiemployer plan within the meaning of Section 3(37) of ERISA), Section 302 of ERISA or Section 412 of
the Code.
(h)
Except for continuation coverage to be provided, and for no longer than continuation coverage is required to be provided, pursuant
to Section 4980B of the Code or any similar state Law for which any director, officer or employee (including any former director, officer
or employee) is responsible for the full cost of such coverage, neither the Company nor any of its Subsidiaries has any current or projected
liability for, and no Company Plan provides or promises, any post-employment or post-retirement medical, dental, disability, hospitalization,
life or similar benefits (whether insured or self-insured) to any director, officer or employee (including any former director, officer
or employee) of the Company or any of its Affiliates.
(i)
Neither the Company nor any of its Subsidiaries has any obligation to gross-up, indemnify or otherwise reimburse any current or
former service provider of the Company or any of its Affiliates for any Tax incurred by such service provider under Sections 409A or 4999
of the Code.
(j)
Except as contemplated by this Agreement, the execution and delivery of this Agreement and the consummation of the Transactions
will not (either alone or in combination with another event), (i) result in any payment or benefit from the Company or any of its Subsidiaries
becoming due, or increase in the amount of any compensation due, to any current or former officers, employees or consultants of the Company
or any of its Affiliates, (ii) increase any benefits otherwise payable under any Company Plan, (iii) result in the acceleration of the
time of payment (including the funding of a trust or transfer of any assets to fund any benefits under any Company Plan) or vesting of
or otherwise trigger any compensation or benefits payable to or in respect of any current or former employee, director or consultant of
the Company or any of its Affiliates or (iv) limit or restrict the right of the Company or any of its Subsidiaries to merge, amend or
terminate any Company Plan.
(k)
No payment or benefit (or portion thereof) that is required to be made by the Company or any of its Subsidiaries under any Company
Plan or this Agreement with respect to any “disqualified individual” (as defined within Treas. Reg. 1.280G-1, Q&A
15), individually or in the aggregate, could be an “excess parachute payment” within the meaning of Section 280G(b)
of the Code.
Section 4.11
Employment and Labor Matters.
(a) The
Company has provided Parent a true, correct and complete list of each employee of the Company or any of its Subsidiaries (the
“Business Employees”) that specifies for each such Business Employee, to the extent applicable, his or her: (i)
name, (ii) job title, (iii) employing entity, (iv) hire date and service date (if different than hire date), (v) status as exempt or
non-exempt under the Fair Labor Standards Act, (vi) current annualized salary or hourly rate of pay, as applicable, (vii)
eligibility to receive other compensation (including bonus, commissions, profit-sharing, pension benefits and any other non-wage
compensation), (viii) leave status (including type of leave, start date of leave, and expected return date), (ix) whether the
Business Employee is on a visa or work permit, the sponsoring entity, and date of expiration, as applicable, and (x) primary
location of employment. The Company has also provided Parent a true, correct and complete list of each individual who provides
material services to the Company or any of its Subsidiaries in the capacity of an independent contractor, along with his or her: (i)
name and, if applicable, the entity through which he or she provides services, (ii) nature of the services performed, and (iii)
compensation rate for such services. Collectively, the individuals listed within the two lists provided by the Company to Parent and
referenced in this Section 4.11(a) represent the individuals reasonably necessary to manage and operate the businesses of the
Company and its Subsidiaries as currently managed and operated.
(b)
The Company and each of its Subsidiaries are, and since January 1, 2022 have been, in compliance in all material respects with
all applicable Laws respecting labor and employment, including all such Laws respecting wages, hours, overtime pay, non-discrimination,
non-retaliation, non-harassment, civil rights, fair employment practices, equal opportunity, recordkeeping, meal and rest breaks, employee
training, immigration and employment eligibility verification, payroll withholdings and deductions, employee privacy, classification and
payment of employees, independent contractors and consultants, pay and employment equity, collective bargaining, employee leave, plant
closings and mass layoffs, workers’ compensation, occupational health and safety, immigration, and the terms and conditions of employment.
(c)
There are not, and since January 1, 2022 have not been, any Proceedings pending or, to the knowledge of the Company, threatened
against the Company or any of its Subsidiaries in connection with the employment or engagement of, on behalf of, or otherwise relating
to, any current or former employee or independent contractor of the Company or any of its Subsidiaries, including any of the Business
Employees.
(d)
Neither the Company nor any Subsidiary of the Company is or has ever been a party to, or bound by, any collective bargaining agreement,
memorandum of understanding, or other contract with a labor union, works council, labor organization, or similar representative of employees.
Neither the Company nor any Subsidiary of the Company is or has ever been subject to any strikes, work stoppages, picketing, walkouts,
slowdowns, or lockouts. There are not, and since January 1, 2022 have not been, any Proceedings pending or, to the knowledge of the Company,
threatened against the Company or any of its Subsidiaries relating to unfair labor practice charges or other material labor disputes.
There is no organizing activity, or demands for recognition or certification, with respect to the formation of a collective bargaining
unit or election or recognition of a collective bargaining representative presently being made or, to the knowledge of the Company, threatened
involving any Business Employee.
Section 4.12
Taxes.
(a) The
Company and each of its Subsidiaries have (i) duly and timely filed (or there have been filed on their behalf) with the appropriate
Taxing Authority all U.S. Federal income and all other material Tax Returns required to be filed by them, taking into account any
extensions of time within which to file such Tax Returns, and all such Tax Returns were and are correct and complete in all material
respects, and (ii) duly and timely paid in full (or there has been duly and timely paid in full on their behalf) all material
amounts of Taxes required to be paid by them, other than Taxes that are not yet due and payable or that are being contested in good
faith by appropriate Proceedings and for which adequate reserves have been established in accordance with GAAP.
(b)
The unpaid Taxes of the Company and its Subsidiaries (i) did not as of the date of the most recent financial statement exceed the
reserve for Taxes set forth on the face of the most recent financial statement (rather than in any notes thereto) and (ii) will not exceed
that reserve as adjusted for the passage of time through the Closing Date in accordance with the past custom and practice of the Company
(and its Subsidiaries) in filing the applicable Tax Returns. Since the date of the most recent financial statement, none of the Company
nor any of its Subsidiaries has incurred any liability for Taxes outside the ordinary course of business.
(c)
(i) There are no audits, investigations by any Governmental Entity or other proceedings pending or, to the knowledge of the Company,
threatened in writing with regard to any Taxes or Tax Returns of the Company or any of its Subsidiaries; (ii) no deficiency for Taxes
of the Company or any of its Subsidiaries has been claimed, proposed or assessed in writing or, to the knowledge of the Company, threatened
in writing, by any Governmental Entity, which deficiency has not yet been settled ; (iii) neither the Company nor any of its Subsidiaries
has waived any statute of limitations with respect to the assessment of Taxes or agreed to any extension of time with respect to any Tax
assessment or deficiency for any open tax year (other than pursuant to extensions of time to file Tax Returns obtained in the ordinary
course); (iv) neither the Company nor any of its Subsidiaries is currently the beneficiary of any extension of time within which to file
any Tax Return that remains unfiled; and (v) neither the Company nor any of its Subsidiaries has entered into any “closing agreement”
as described in Section 7121 of the Code (or any corresponding or similar provision of state, local or foreign income Tax Law).
(d)
None of the Company nor any of its Subsidiaries will be required to include any item of income in, or exclude any item of deduction
from, taxable income for any taxable period (or portion thereof) ending after the Closing Date as a result of any: (i) change in or improper
use of method of accounting (other than by virtue of one or more of the transactions contemplated by this Agreement) for a taxable period
ending on or prior to the Closing Date under Code Section 481(c) (or any corresponding or similar provision of state, local or foreign
income Tax Law) or other provisions of applicable Law; (ii) “closing agreement” as described in Code Section 7121 (or
any corresponding or similar provision of state, local or foreign income Tax Law) executed on or prior to the Closing Date; (iii) installment
sale or open transaction made on or prior to the Closing Date, (iv) prepaid amount or deferred revenue received on or prior to the Closing
Date other than in the ordinary course of business, (v) intercompany transaction or excess loss account described in Treasury Regulations
under Section 1502 of the Code (or any corresponding or similar provision of state, local, or non-U.S. Tax law); or (vi) an election under
Section 965(h) of the Code (or any corresponding or similar provision of state, local or non-U.S. law).
(e)
The Company and its Subsidiaries have complied, in all material respects, with all applicable Laws relating to the payment and
withholding of Taxes (including withholding of Taxes pursuant to Sections 1441, 1442, 1445, 1446, 1471, 3102 and 3402 of the Code or similar
provisions under any state and foreign Laws) and have duly and timely withheld and, in each case, have paid over to the appropriate Taxing
Authority all amounts required to be so withheld and paid over on or prior to the due date thereof under all applicable Laws.
(f)
There are no Tax Liens upon any property or assets of the Company or any of its Subsidiaries except for Liens for Taxes not yet
due and payable or that are being contested in good faith by appropriate proceedings and for which adequate reserves have been established
in accordance with GAAP.
(g)
Neither the Company nor any of its Subsidiaries has requested, has received or is subject to any written ruling of a Taxing Authority.
(h)
There are no Tax allocation or sharing agreements or similar arrangements with respect to or involving the Company or any of its
Subsidiaries, and after the Closing Date neither the Company nor any of its Subsidiaries shall be bound by any such Tax allocation agreements
or similar arrangements or have any liability thereunder for amounts due in respect of periods prior to the Closing Date, in each case,
other than customary provisions of commercial or credit agreements.
(i)
Neither the Company nor any of its Subsidiaries (i) has been a member of an affiliated group filing a consolidated U.S. federal
income Tax Return or (ii) has any liability for the Taxes of any Person (other than any Subsidiary of the Company) under Treasury Regulation
Section 1.1502-6 (or any similar provision of state, local or foreign Tax Law), as a transferee or successor, or otherwise by Law.
(j)
Neither the Company nor any of its Subsidiaries has participated in any “reportable transaction” within the
meaning of Treasury Regulation Section 1.6011-4(b).
(k)
Neither the Company nor any of its Subsidiaries has constituted either a “distributing corporation” or a “controlled
corporation” (within the meaning of Section 355(a)(1)(A) of the Code) in a distribution of stock qualifying for tax-free treatment
under Section 355 of the Code in the two years prior to the date of this Agreement.
(l)
No written power of attorney that has been granted by the Company or any of its Subsidiaries (other than to the Company or any
of its Subsidiaries) is currently in force with respect to any matter relating to Taxes.
(m)
Neither the Company nor any of its Subsidiaries (i) has elected to defer the payment of any Taxes pursuant to Section 2302 of the
CARES Act or any other COVID-19 Measures or (ii) has claimed any “employee retention credit” pursuant to Section 2301
of the CARES Act.
Section 4.13
Litigation. Except for such matters as would not reasonably be expected to have, individually or in the aggregate, a
Company Material Adverse Effect, there is no, and since January 1, 2022 has been no, (a) Proceeding pending or, to the knowledge of the
Company, threatened against the Company or any of its Subsidiaries or any of their respective properties, rights or assets or (b) judgment,
decree or injunction, ruling or order, in each case, of any Governmental Entity or arbitrator outstanding against the Company or any of
its Subsidiaries.
Section 4.14 Intellectual
Property.
(a)
Section 4.14(a) of the Company Disclosure Letter identifies each item of Company Intellectual Property that is the subject
of a registration or application in any jurisdiction (“Company Registered Intellectual Property”), including, with
respect to each patent and patent application: (i) the name of the applicant/registrant, (ii) the jurisdiction of application/registration,
(iii) the application or registration number and (iv) any other co-applicants/co-owners. To the Company’s knowledge, each of the
patents and patent applications included in Section 4.14(a) of the Company Disclosure Letter properly identifies by name each and
every inventor of the inventions claimed therein as determined in accordance with applicable Laws of the United States. To the Company’s
knowledge, as of the date of this Agreement, no litigation, cancellation, interference, derivation proceeding, opposition, inter partes
review, post grant review, reexamination or other proceeding of any nature (other than office actions or similar communications issued
by any Governmental Entity in the ordinary course of prosecution of any pending applications for registration) is pending or threatened
in writing, in which the scope, validity, enforceability or ownership of any Company Intellectual Property is being or has been contested
or challenged.
(b)
To the Company’s knowledge, the Company and its Subsidiaries exclusively own, are the sole assignees of, or have exclusively
licensed all Company Intellectual Property (other than as disclosed on Section 4.14(b) of the Company Disclosure Letter), free
and clear of all Liens other than Permitted Liens. All Company Intellectual Property that is licensed to the Company or any of its Subsidiaries
is licensed pursuant to a written agreement. To the Company’s knowledge each Company Associate involved in the creation or development
of any Company Intellectual Property, pursuant to such Company Associate’s activities on behalf of the Company or any of its Subsidiaries,
has signed a written agreement containing an assignment of such Company Associate’s rights in such Company Intellectual Property
to the Company or such Subsidiary. To the Company’s knowledge each Company Associate who has or has had access to trade secrets
or confidential information of the Company or any of its Subsidiaries has signed a valid and enforceable written agreement containing
confidentiality provisions protecting the Company Intellectual Property, trade secrets and confidential information. To the Company’s
knowledge the Company and its Subsidiaries have taken commercially reasonable steps to protect and preserve the confidentiality of their
trade secrets and confidential information.
(c)
To the Company’s knowledge no funding, facilities or personnel of any Governmental Entity or any university, college, research
institute or other educational institution has been used to create Company Intellectual Property that is solely created by the Company.
(d) Section
4.14(d) of the Company Disclosure Letter sets forth each license agreement pursuant to which the Company or any of its
Subsidiaries (i) is granted a license under any Intellectual Property owned by any third party that is used by the Company or a
Subsidiary of the Company in its business as currently conducted (each a “Company In-bound License”) or (ii)
grants to any third party a license under any Company Intellectual Property (each a “Company Out-bound License”)
(provided, that, Company In-bound Licenses shall not include, when entered into in the ordinary course of business, material
transfer agreements, services agreements, clinical trial agreements, agreements with Company Associates, commercially available
Software-as-a-Service offerings or off-the-shelf software licenses; and Company Out-bound Licenses shall not include, when entered
into in the ordinary course of business, material transfer agreements, clinical trial agreements, services agreements, or
non-exclusive outbound licenses). To the Company’s knowledge, all Company In-bound Licenses and Company Out-bound Licenses are
in full force and effect and are binding obligations of each party to such Company In-bound Licenses or Company Out-bound Licenses.
No party to such Company In-bound Licenses or Company Out-bound Licenses are in breach under to such Company In-bound Licenses or
Company Out-bound Licenses.
(e)
(i) To the Company’s knowledge the operation of the businesses of the Company and its Subsidiaries as currently conducted
does not infringe, misappropriate or otherwise violate any Intellectual Property of any other Person and (ii) no other Person is infringing,
misappropriating or otherwise violating any Company Intellectual Property. To the Company’s knowledge no legal proceeding is pending
(or, to the Knowledge of the Company and its Subsidiaries, is threatened in writing) (A) against the Company or any of its Subsidiaries
alleging that the operation of the business of the Company or such Subsidiary infringes or constitutes the misappropriation or other violation
of any Intellectual Property of another Person or (B) by the Company or any of its Subsidiaries alleging that another Person has infringed,
misappropriated or otherwise violated any of the Company Intellectual Property. Since January 1, 2022, the Company and its Subsidiaries
have not received any written notice or other written communication alleging that the operation of the business of the Company or any
of its Subsidiaries infringes or constitutes the misappropriation or other violation of any Intellectual Property of another Person.
(f)
To the Company’s knowledge none of the Company Intellectual Property is subject to any pending or outstanding injunction,
directive, order, judgment or other disposition of dispute that adversely and restricts the use, transfer, registration or licensing by
the Company or any of its Subsidiaries of any such Company Intellectual Property.
(g)
The Company has taken commercially reasonable steps and implemented commercially reasonable disaster recovery and security plans
and procedures to protect the information technology systems used in, material to or necessary for operation of the business of the Company
as currently conducted from unauthorized use, acquisition or access. To the knowledge of the Company, there have been no material malfunctions
or unauthorized intrusions, or breaches of the information technology systems used in, material to or necessary for the operation of the
business of the Company as currently conducted.
Section 4.15
Real Property. Neither the Company nor any Subsidiary of the Company owns any real property, other than as and to the
extent disclosed in Section 4.15 of the Company Disclosure Letter or the Company SEC Documents filed or furnished with the SEC
prior to the date hereof. Neither the Company nor any Subsidiary of the Company has leased or subleased any real property and does not
have any obligation to pay any rent or other fees for any real property other than as and to the extent disclosed in the Company SEC Documents
filed or furnished with the SEC prior to the date hereof.
Section 4.16
Material Contracts.
(a)
Section 4.16(a) of the Company Disclosure Letter sets forth a true and complete list, as of the date of this Agreement,
of:
(i)
Each merger, business combination, acquisition, purchase, sale or divestiture contract that contains representations, covenants,
indemnities or other obligations (including “earnout” or other contingent payment obligations) that would reasonably
be expected to result in the receipt of or making of future payments in excess of $100,000;
(ii)
each contract that grants any right of first refusal or right of first offer or that limits the ability of the Company, any Subsidiary
of the Company or any of their respective Affiliates to own, operate, sell, transfer, pledge or otherwise dispose of any businesses, securities
or assets (other than provisions requiring notice of or consent to assignment by any counterparty thereto);
(iii)
each contract relating to outstanding Indebtedness (or commitments or guarantees in respect thereof) of the Company or any of its
Subsidiaries (whether incurred, assumed, guaranteed or secured by any asset) in excess of $50,000;
(iv)
each employment contract to which the Company or a Subsidiary of the Company is a party other than employment contracts that can
be terminated at any time with less than two days’ notice and without financial liability to the Company or any of its Subsidiaries;
(v)
each contract containing any non-compete, non-solicit, exclusivity or similar type of provision that materially restricts the ability
of the Company or any of its Subsidiaries (including Parent upon consummation of the Transactions) to compete or otherwise engage in any
line of business or with any Person or geographic area;
(vi)
each contract pursuant to which the Company or any Subsidiary of
the Company may be obligated to issue or repurchase any Company Capital Stock or any capital stock or other equity interests in any Subsidiary
of the Company (including the Company Warrants and the Company Convertible Notes);
(vii)
each partnership, joint venture, limited liability company, grantor trust, strategic alliance agreement or other similar agreement
to which the Company or a Subsidiary of the Company is a party (other than any such agreement solely between or among the Company and
its wholly-owned Subsidiaries);
(viii)
each contract between or among the Company or any Subsidiary of the Company, on the one hand, and any officer, director or Affiliate
(other than a wholly-owned Subsidiary of the Company) of the Company or any of its Subsidiaries or any of their respective “associates”
or “immediate family” members (as such terms are defined in Rule 12b-2 and Rule 16a-1 of the Exchange Act), on the
other hand;
(ix)
each contract that obligates the Company or any of its Subsidiaries to indemnify any past or present directors, officers, or employees
of the Company or any of its Subsidiaries;
(x)
each material vendor, supplier or third party consulting or similar contract not otherwise described in this Section 4.16(a)
that (A) cannot be voluntarily terminated pursuant to its terms within 60 days after the Effective Time and (B) under which it is reasonably
expected the Company or any of its Subsidiaries will be required to pay fees, expenses or other costs in excess of $50,000 following the
Effective Time; and
(xi)
each “material contract” (as such term is defined in Item 601(b)(10) of Regulation S-K under the Exchange Act)
not otherwise described in this Section 4.16(a) with respect to the Company or any Subsidiary of the Company.
(b)
Collectively, the contracts set forth in Section 4.16(a) are herein referred to as the “Company Contracts.”
Except as would not reasonably be expected to have, individually or in the aggregate, a Company Material Adverse Effect and assuming each
Company Contract has been duly authorized and is enforceable on each party thereto (excluding the Company and each of its Subsidiaries),
each Company Contract is legal, valid, binding and enforceable in accordance with its terms on the Company and each of its Subsidiaries
that is a party thereto and is in full force and effect, subject, as to enforceability, to Creditors’ Rights. Except as would not
reasonably be expected to have, individually or in the aggregate, a Company Material Adverse Effect, neither the Company nor any of its
Subsidiaries is in breach or default under any Company Contract nor, to the knowledge of the Company, is any other party to any such Company
Contract in breach or default thereunder. Complete and accurate copies of each Company Contract in effect as of the date hereof (including
all amendments and modifications) have been furnished to or otherwise made available to Parent. Neither the Company nor any of its Subsidiaries
has received written notice of any material violation of or material default under any Company Contract.
Section 4.17
Insurance. To the knowledge of the Company, (a) all current, material insurance policies of the Company and its Subsidiaries
(collectively, the “Material Company Insurance Policies”) are in full force and effect and (b) all premiums payable
under the Material Company Insurance Policies prior to the date of this Agreement have been duly paid. As of the date of this Agreement,
no written notice of cancellation or termination has been received with respect to any Material Company Insurance Policy.
Section 4.18
Environmental Matters.
(a)
The Company and its Subsidiaries are, and for the past three (3) years have been, in compliance with all Environmental Laws and
have not (i) received from any Person any (A) written notice or (B) request for information pursuant to Environmental Law or (ii) been
subject to any environmental claim, which, in each case, either remains pending, threatened, or unresolved, except as would not reasonably
be expected to have, individually or in the aggregate, a Company Material Adverse Effect.
(b)
No Company Owned Real Property or Company Leased Real Property is currently listed on, or has been proposed for listing on, the
National Priorities List (or CERCLIS) under CERCLA, or any similar Law.
(c)
There are no Hazardous Materials present at any Company Owned Real Property or Company Leased Real Property in quantities or concentrations
requiring remedial or corrective action under any Environmental Law except as would not reasonably be expected to have, individually or
in the aggregate, a Company Material Adverse Effect.
(d)
The Company has previously made available to Parent true and complete copies of any and all material environmental reports, studies,
audits, records, sampling data, site assessments and other similar documents with respect to the business or assets of the Company or
any currently operated or leased real property which are in the reasonable possession, custody, or control of the Company.
Section 4.19
Brokers. No broker, investment banker or other Person is entitled to any broker’s, finder’s or other similar
fee or commission in connection with the Transactions based upon arrangements made by or on behalf of the Company or any of its Subsidiaries.
Section 4.20
State Takeover Statute. The Company Board has taken all action necessary to render inapplicable to the Merger and the
other Transactions to the extent applicable to the Company, any Takeover Law.
Section 4.21
Investment Company Act. Neither the Company nor any of its Subsidiaries is, or as of immediately prior to the Effective
Time will be, required to be registered as an investment company under the Investment Company Act.
Section 4.22
Related Party Transactions. Except as set forth in Section 4.22 of the Company Disclosure Letter and as set forth
in the Company SEC Documents filed through and including the date of this Agreement or as permitted by this Agreement, from January 1,
2021 through the date of this Agreement there have been no transactions, agreements, arrangements or understandings between the Company
or any of its Subsidiaries, on the one hand, and any Affiliates (other than Subsidiaries of the Company) of the Company, on the other
hand, that would be required to be disclosed under Item 404 of Regulation S-K promulgated by the SEC. Section 4.21 of the
Company Disclosure Letter sets forth each agreement between the Company or any of its Subsidiaries, on the one hand, and any Affiliates
(other than Subsidiaries of the Company) of Company, on the other hand.
Section 4.23
FDA Regulatory.
(a) To
the Knowledge of the Company, the Company is, and has been, in compliance in all materials respects with all applicable Laws in the
jurisdictions in which the Company conducts business including but not limited to, as applicable (i) preclinical and clinical
testing, (ii) application for marketing approval of, manufacture, distribution, promotion and sale of the Products, (iii) the
requirement for and the terms of all necessary permits, (iv) establishment registration, (v) payment of all establishment fees, (vi)
Good Clinical Practices, (vii) Good Manufacturing Practices, and (viii) recordkeeping and reporting requirements. The Company is not
in default with respect to any order, writ, judgment, award, injunction or decree of any Governmental Entity or arbitrator
applicable to it, or any of its assets. The Company has not received, at any time during the prior five (5) years from the actual
date of this Agreement, any written notice from any Governmental Entity regarding any actual, alleged, or potential violation of, or
failure to comply with, any Law applicable to the Company in any material respect.
(b)
To the Knowledge of the Company, the Company and any suppliers, manufacturers, or other companies with which the Company contracts
for services related to the Products, holds all certificates, authorizations, registrations, reports, documents, permits or notices required
to be filed, maintained or furnished under FDA Law and all other applicable local, state, and federal laws and regulations of the relevant
Governmental Entity engaged in the regulation of pharmaceuticals or biohazardous materials in the jurisdictions in which the Company performs
clinical trials and/or markets its Products (“FDA Permits”). All FDA Permits are in full force and effect in all material
respects and no suspension, revocation, cancellation, or withdrawal of such FDA Permits is threatened and there is no reasonable basis
for believing that such FDA Permits will not be renewable upon expiration or will be suspended, revoked, cancelled, or withdrawn.
(c)
The Company has not received any written notices or statements from the FDA, the EMEA or any other Governmental Entity, and otherwise
has no knowledge or reason to believe, that (i) any drug, including the Products or other product candidate of the Company (each a “Potential
Product”) may or will be rejected or determined to be non-approvable; (ii) a delay in time for review and/or approval of a marketing
authorization application or marketing approval application in any jurisdiction for any Potential Product is or may be required, requested
or being implemented; (iii) one or more clinical studies for any Potential Product shall or may be requested or required in addition to
the clinical studies submitted to the FDA prior to the date hereof as a precondition to or condition of issuance or maintenance of a marketing
approval for any Potential Product; (iv) any license, approval, permit or authorization to conduct any clinical trial of or market any
product or Potential Product of the Company has been, will be or may be suspended, revoked, modified or limited. The Company has not marketed
Potential Products in a manner in any way suggesting that a Potential Product has been approved for an indication that exceeds the scope
of the approved product label. The Company is not aware of the results of any studies, tests or trials the which reasonably call into
question the results of the tests and trials conducted by or on behalf of the Company with respect to Potential Products.
(d) The
Company has not received any written notice or communication from any Governmental Entity of any actual or threatened investigation,
inquiry, or administrative, judicial, or regulatory action, hearing, or enforcement proceeding against the Company regarding any
violation of applicable FDA Law or other applicable local, state, and federal laws and regulations of the relevant Governmental
Entity engaged in the regulation of pharmaceuticals or biohazardous materials, including but not limited to a notice of adverse
finding, warning letter, clinical hold notice, recall, field correction, market withdrawal or replacement, safety alert,
“dear doctor” letter, investigator notice, or other notice or action relating to an alleged or potential lack of
safety or efficacy of any Products of the Company, any alleged product defect of any Products of the Company, or any violation of
any material applicable law, rule, regulation or any clinical trial or marketing license, approval, permit or authorization for any
Products of the Company, and the Company is not aware of any facts or information that would cause it to initiate any such notice or
action and has no knowledge or reason to believe that the FDA, the EMEA or any other Governmental Entity or authority or any
institutional or ethical review board or other non- governmental authority intends to impose, require, request or suggest any
material obligation arising under an investigation, inquiry, or administrative, judicial, or regulatory action, hearing, or
enforcement proceeding.
(e)
In the last five (5) years, the Company has not been party to any corporate integrity agreement, monitoring agreement, consent
decree, settlement order, or other similar written agreement, in each case, entered into with or imposed by the FDA. Neither the Company
no, to the Knowledge of the Company, any of its officers, employees, or agents, or any manufacturers, distributor, or other entity in
the Company’s supply chain, has been or is currently disqualified or debarred, suspended, proposed for debarment or suspensions,
deemed non-responsible, or otherwise excluded from the award of contracts or from participating in any Federal healthcare program by any
Federal agency or other Governmental Entity. Neither the Company nor, to the Knowledge of the Company, any of its officers, employees,
or agents has made an untrue statement of a material fact or a fraudulent statement to the FDA or failed to disclose a material fact required
to be disclosed to the FDA, in each of the foregoing cases on behalf of the Company.
(f)
No officer, employee, or agent of the Company is or has been, or has been threatened to be: (a) debarred under FDA proceedings
pursuant to 21 U.S.C. § 335a; (b) disqualified under FDA investigator qualification proceedings; (c) subject to the FDA’s
Application Integrity Policy; or (d) subject to any enforcement proceeding arising from material false statements to the FDA pursuant
to 18 U.S.C. § 1001.
(g)
Neither the Company nor any of its managers, directors, officers, agents, or employees have (i) used any corporate funds of the
Company for unlawful contributions, gifts, entertainment or other unlawful expenses related to political activity, (ii) made any unlawful
payments to foreign or domestic government officials or employees or to foreign or domestic political parties or campaigns from corporate
funds or violated any provision of the U.S. Foreign Corrupt Practices Act of 1977, as amended, or any other U.S. or foreign Laws concerning
corrupt payments applicable to its business or (iii) made or received any other payment, contribution, gift, bribe, rebate, payoff or
kick-back prohibited under any applicable Law. Neither the Company nor any of its managers, directors, officers, stockholders, agents,
or employees is or has been the subject of any investigation, inquiry or enforcement Proceeding by any Governmental Entity regarding any
offense or alleged offense under anti-bribery, anti-corruption, or anti-fraud Law in any jurisdiction and, no such investigation, inquiry
or Proceedings have been threatened.
Section 4.24
No Additional Representations.
(a) Except
for the representations and warranties made in this Article IV, neither the Company nor any other Person makes any express or
implied representation or warranty with respect to the Company or its Subsidiaries or their respective businesses, operations,
assets, liabilities or conditions (financial or otherwise) in connection with this Agreement or the Transactions, and the Company
hereby disclaims any such other representations or warranties. In particular, without limiting the foregoing disclaimer, neither the
Company nor any other Person makes or has made any representation or warranty to Parent, Merger Sub, or any of their respective
Affiliates or Representatives with respect to (i) any financial projection, forecast, estimate, budget or prospect information
relating to the Company or any of its Subsidiaries or their respective properties, assets or businesses or (ii) except for the
representations and warranties made by the Company in this Article IV, any oral or written information presented to Parent or
Merger Sub or any of their respective Affiliates or Representatives in the course of their due diligence investigation of the
Company, the negotiation of this Agreement or in the course of the Transactions.
(b)
Notwithstanding anything contained in this Agreement to the contrary, the Company acknowledges and agrees that none of Parent,
Merger Sub or any other Person has made or is making, and the Company expressly disclaims reliance upon, any representations, warranties
or statements relating to Parent or its Subsidiaries (including Merger Sub) whatsoever, express or implied, beyond those expressly given
by Parent and Merger Sub in Article V, the Parent Disclosure Letter or in any other document or certificate delivered by Parent
or Merger Sub or their respective Affiliates or Representatives in connection herewith, including any implied representation or warranty
as to the accuracy or completeness of any information regarding Parent furnished or made available to the Company or any of its Affiliates
or Representatives. Without limiting the generality of the foregoing, the Company acknowledges that no representations or warranties are
made with respect to any projections, forecasts, estimates, budgets or prospect information that may have been made available to the Company
or any of its Affiliates or Representatives (including in certain “data rooms,” “virtual data rooms,”
management presentations or in any other form in expectation of, or in connection with, the Merger or the other Transactions).
Article
V
REPRESENTATIONS AND WARRANTIES OF PARENT AND MERGER SUB
Except as set forth in the
disclosure letter delivered by Parent and Merger Sub to the Company on or prior to the Original Date of this Agreement (the “Parent
Disclosure Letter”) and except as disclosed in the Parent SEC Documents filed or furnished with the SEC and publicly available
on EDGAR at least two (2) Business Days prior to the Original Date (including all exhibits and schedules thereto and documents incorporated
by reference therein, but excluding any forward-looking disclosures set forth in any “risk factors” section, any disclosures
in any “forward looking statements” section and any other disclosures included therein to the extent they are predictive
or forward looking in nature), Parent and Merger Sub acknowledges that, as of such Original Date, each jointly and severally represented
and warranted to the Company as follows, which representations and warranties, unless modified by this Agreement (which modification may
include deletion of such representation or warranty), remain in effect, but solely to the extent made in the Original Agreement, without
novation, notwithstanding the repetition thereof in this Agreement. All references in Article V of this Agreement to the “date
of this Agreement,” the “date hereof,” or similar wording shall be deemed to refer to the date of the Original
Agreement, and any representation or warranty stated in the present tense, regardless of its repetition in Article V of this Agreement,
shall be read to apply solely in the past tense as of the Original Date. Representations and warranties made with respect to the occurrence
or non-occurrence of an event or set of facts since a certain date shall likewise solely apply from such prior date through the Original
Date:
Section 5.1 Organization,
Standing and Power.
(a)
Each of Parent and its Subsidiaries (including Merger Sub) is, as applicable, a corporation, partnership or limited liability company
duly organized, validly existing and, where relevant, in good standing under the Laws of its jurisdiction of incorporation or organization,
with all requisite entity power and authority to own, lease and, to the extent applicable, operate its properties and to carry on its
business as now being conducted, other than where the failure to be so organized, validly existing, in good standing or to have such power
or authority would not reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect on Parent (a “Parent
Material Adverse Effect”). Each of Parent and its Subsidiaries (including Merger Sub) is duly qualified or licensed to do business
and, where relevant, is in good standing in each jurisdiction in which the business it is conducting, or the operation, ownership or leasing
of its properties, makes such qualification, licensing or good standing necessary, other than where the failure to so qualify, be licensed
or in good standing would not reasonably be expected to have, individually or in the aggregate, a Parent Material Adverse Effect. Parent
and Merger Sub each has heretofore made available to the Company complete and correct copies of its Organizational Documents.
(b)
Section 5.1(b) of the Parent Disclosure Letter sets forth an accurate and complete list of each Significant Subsidiary of
Parent, together with (i) the jurisdiction of incorporation or organization, as the case may be, of such Significant Subsidiary, (ii)
the type and percentage of interest held, directly or indirectly, by Parent in such Significant Subsidiary, (iii) the amount of such Significant
Subsidiary’s authorized capital stock or other equity interests and (iv) the amount of such Significant Subsidiary’s outstanding
capital stock or other equity interests.
Section 5.2
Capital Structure.
(a)
As of the date of this Agreement, the authorized capital stock of Parent consists of (i) 100,000,000 shares of Parent Common Stock
and (ii) 3,000,000 shares of Parent Preferred Stock. At the close of business on December 7, 2023: (A) 1,248,969 shares of Parent Common
Stock were issued and 1,248,918 shares of Parent Common Stock were outstanding; (B) 0 shares of Parent Preferred Stock were issued and
0 shares of Parent Preferred Stock were outstanding; (C) ) 1,114 shares of Company Common Stock were reserved and available for issuance
pursuant to the Company 2017 Equity Incentive Plan; (D) 44,459 shares of Company Common Stock were reserved and available for issuance
pursuant to the Company’s 2021 Omnibus Equity Incentive Plan; (E) 173,557 shares of Company Common Stock were reserved for issuance
in connection with the July 2023 secured promissory note; and (F) 1,261,882 shares of Company Common Stock were reserved for issuance
in connection with the exercise of the Company Warrants. Except as set forth in this Section 5.2, at the close of business on December
7, 2023, there are no other shares of outstanding Parent Capital Stock issued, reserved for issuance or outstanding.
(b) All
outstanding shares of Parent Capital Stock have been, and all shares of Parent Common Stock to be issued in connection with the
Merger, when so issued in accordance with the terms of this Agreement, are or will be, as applicable, (i) duly authorized, validly
issued, fully paid and nonassessable and are not subject to preemptive rights and (ii) issued and granted in compliance in all
material respects with applicable state and federal securities Laws and other applicable Law, the Delaware General Corporation Law
and the Organizational Documents of Parent. The Parent Common Stock to be issued pursuant to this Agreement, when issued, will be
(A) validly issued, fully paid and nonassessable and not subject to preemptive rights, (B) free and clear of any Liens and (C)
issued in compliance in all material respects with (i) applicable securities Laws and other applicable Law and (ii) all requirements
set forth in any applicable contracts of Parent or its Subsidiaries. Parent owns, of record and beneficially, directly or
indirectly, all of the issued and outstanding shares of capital stock, membership interests, partnership interests or other equity
interests, as applicable, of the Subsidiaries of Parent, including Merger Sub, free and clear of all Liens, other than Permitted
Liens. As of the close of business on September 30, 2023, except as set forth in this Section 5.2, there is or are no
outstanding: (i) shares of Parent Capital Stock; (ii) Voting Debt; (iii) securities of Parent or any Subsidiary of Parent
convertible into or exchangeable or exercisable for shares of Parent Capital Stock or Voting Debt; (iv) contractual obligations of
Parent or any Subsidiary of Parent to repurchase, redeem or otherwise acquire any shares of Parent Capital Stock or capital stock,
membership interests, partnership interests, joint venture interests or other equity interests of any Subsidiary of Parent, except
as set forth in Section 5.2(b) of the Parent Disclosure Letter; or (v) subscriptions, options, warrants, calls, puts,
rights of first refusal or other rights (including preemptive rights), commitments or agreements to which Parent or any Subsidiary
of Parent is a party or by which it is bound, in any case, obligating Parent or any Subsidiary of Parent to (1) issue, deliver,
transfer, sell, purchase, redeem or acquire, or cause to be issued, delivered, transferred, sold, purchased, redeemed or acquired,
additional shares of Parent Capital Stock, any Voting Debt or other voting securities of Parent or (2) grant, extend or enter into
any such subscription, option, warrant, call, put, right of first refusal or other similar right, commitment or agreement. There are
no shareholder agreements, voting trusts or other agreements to which Parent is a party or by which it is bound relating to the
voting of any shares of Parent Capital Stock.
(c)
As of the date of this Agreement, all of the outstanding capital stock of Merger Sub are validly issued and fully paid and are
wholly-owned by Parent.
(d)
All dividends or other distributions on the shares of Parent Capital Stock and any material dividends or other distributions on
any securities of any Subsidiary of Parent which have been authorized or declared prior to the date hereof have been paid in full (except
to the extent such dividends or distributions have been declared and are not yet due and payable).As of the date of this Agreement, except
as disclosed in the Parent SEC Documents, there are no declared and unpaid dividends or other distributions with respect to any shares
of Parent Capital Stock or declared and unpaid material dividends with respect to any securities of any Subsidiary of Parent.
Section 5.3
Authority; No Violations; Approvals.
(a) Each
of Parent and Merger Sub has all requisite corporate power to execute and deliver this Agreement and to perform its obligations
hereunder. The execution, delivery and performance of this Agreement by Parent and Merger Sub and the consummation by Parent and
Merger Sub of the Transactions, including the consummation of the Merger, have been duly and validly authorized by all necessary
corporate action on the part of each of Parent and Merger Sub, subject to, with respect to consummation of the Merger, the filing of
the Certificate of Merger and the Certificate of Designations for the Exchanged Parent Preferred Stock (the
“Designation”) with, and acceptance for record by, the Delaware Department. This Agreement has been duly executed
and delivered by each of Parent and Merger Sub and, assuming the due and valid execution of this Agreement by the Company,
constitutes a valid and legally binding obligation of each of Parent and Merger Sub enforceable against Parent and Merger Sub in
accordance with its terms, subject, as to enforceability, to Creditors’ Rights. The Parent Board, at a meeting duly called and
held unanimously, (i) determined that this Agreement and the Transactions, including the Parent Stock Issuance, are in the best
interests of Parent and its shareholders and (ii) adopted and approved this Agreement and the Transactions, including the Parent
Stock Issuance. The Merger Sub Sole Stockholder has (A)(1) determined that this Agreement and the Transactions, including the
Merger, are in the best interests of Merger Sub and (2) adopted and approved this Agreement and declared that the Transactions,
including the Merger, are advisable, and (B) executed a written consent pursuant to which it has authorized, adopted and approved
this Agreement and the Transactions, including the Merger. As of the date hereof, none of the foregoing actions by the Parent Board
or the Merger Sub Sole Member have been rescinded, withdrawn or modified in any way. No approval of holders of Parent Capital Stock
is necessary to approve the Transactions, including the Merger.
(b)
Except as set forth in Section 5.3(b) of the Parent Disclosure Letter, the execution and delivery of this Agreement does
not, and the consummation of the Transactions will not (with or without notice or lapse of time, or both) (i) contravene, conflict with
or result in a violation of any provision of the Organizational Documents of Parent or Merger Sub, (ii) result in a violation of, or default
under, or acceleration of any material obligation or the loss of a material benefit under, or result in the creation of any Liens upon
any of the properties or assets of Parent or any of its Subsidiaries under, any provision of any Parent Contract to which Parent or any
of its Subsidiaries is a party or by which Parent, Merger Sub, any of their respective Subsidiaries or their respective properties or
assets are bound, or (iii) assuming the Consents referred to in Section 5.4 are duly and timely obtained or made, contravene, conflict
with or result in a violation of any Law applicable to Parent, any of its Subsidiaries or any of their respective properties or assets,
other than, in the case of clauses (ii) and (iii), any such contraventions, conflicts, violations, defaults, acceleration,
losses, or Liens that would not reasonably be expected to have, individually or in the aggregate, a Parent Material Adverse Effect.
Section 5.4
Consents. Except as set forth in Section 5.4 of the Parent Disclosure Letter, no Consent from any Governmental
Entity is required to be obtained or made by Parent or any of its Subsidiaries in connection with the execution and delivery of this Agreement
by Parent or Merger Sub or the consummation by Parent or Merger Sub of the Transactions, except for: (a) the filing with the SEC of such
reports under the Exchange Act and the Securities Act, and such other compliance with the Exchange Act and the Securities Act and the
rules and regulations thereunder, as may be required in connection with this Agreement and the Transactions; (b) the filing of the Certificate
of Merger, the Designation and any other required filings with, and the acceptance for record by, the Delaware Department pursuant to
the DGCL; (c) such filings as may be required under the rules and regulations of the NASDAQ; (d) such filings and approvals as may be
required by any applicable state securities or “blue sky” Laws or Takeover Laws; and (e) any such Consent that the
failure to obtain or make would not reasonably be expected to have, individually or in the aggregate, a Parent Material Adverse Effect.
Section 5.5 SEC
Documents; Financial Statements; Internal Controls and Procedures.
(a)
Since December 31, 2021, Parent has filed or furnished with the SEC all forms, reports, schedules and statements required to be
filed or furnished under the Securities Act or the Exchange Act, respectively (such forms, reports, schedules and statements, as amended,
collectively, the “Parent SEC Documents”). As of their respective filing dates, or, if amended prior to the date hereof,
as of the date of (and giving effect to) the last such amendment made prior to the date hereof, each of the Parent SEC Documents, complied
as to form in all material respects with the applicable requirements of the Securities Act or the Exchange Act, as the case may be, and
the rules and regulations of the SEC thereunder applicable to such Parent SEC Documents, and none of the Parent SEC Documents contained,
when filed or, if amended prior to the date of this Agreement, as of the date of such amendment with respect to those disclosures that
are amended, any untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary to
make the statements therein, in light of the circumstances under which they were made, not misleading.
(b)
The consolidated audited and unaudited interim financial statements of Parent included or incorporated by reference in the Parent
SEC Documents, including all notes and schedules thereto, complied in all material respects, when filed or if amended prior to the date
of this Agreement, as of the date of such amendment, with the rules and regulations of the SEC with respect thereto, were prepared in
accordance with GAAP, applied on a consistent basis during the periods indicated (except as may be indicated in the notes thereto or,
in the case of the unaudited statements, as permitted by Rule 10-01 of Regulation S-X of the SEC) and fairly present in all material respects
in accordance with applicable requirements of GAAP (subject, in the case of the unaudited interim financial statements, to normal year-end
audit adjustments) the consolidated financial position, results of operations, shareholders’ equity and cash flows of Parent and
its Subsidiaries, as of the respective dates thereof and for the respective periods indicated therein (subject, in the case of unaudited
interim financial statements, to absence of notes and normal year-end adjustments). To the knowledge of Parent, as of the date hereof,
none of the Parent SEC Documents is the subject of ongoing SEC review and Parent does not have outstanding and unresolved comments from
the SEC with respect to any of the Parent SEC Documents. As of the date hereof, none of the Parent SEC Documents is the subject of any
confidential treatment request by Parent.
(c)
Other than any off-balance sheet arrangements disclosed in the Parent SEC Documents filed or furnished prior to the date hereof,
neither Parent nor any Subsidiary of Parent is a party to, or has any contract to become a party to, any joint venture, off-balance sheet
partnership or any similar contractual arrangement, including any off-balance sheet arrangements (as described in Instruction 8 to Item
303(b) of Regulation S-K of the SEC) where the purpose of such contract is to avoid disclosure of any material transaction involving,
or material liabilities of, Parent in Parent’s published financial statements or any Parent SEC Documents.
(d) Parent
has established and maintains disclosure controls and procedures and a system of internal controls over financial reporting (as such
terms are defined in Rule 13a-15 and Rule 15d-15 under the Exchange Act) as required by the Exchange Act. From January 1, 2022, to
the date of this Agreement, Parent’s auditors and the Parent Board have not been advised of (i) any significant
deficiencies or material weaknesses in the design or operation of internal controls over financial reporting that are reasonably
likely to adversely affect in any material respect Parent’s ability to record, process, summarize and report financial
information or (ii) any fraud, whether or not material, that involves management or other employees who have a significant role in
Parent’s internal controls over financial reporting, and, in each case, neither Parent nor any of its Affiliates or
Representatives has failed to disclose such information to Parent’s auditors or the Parent Board.
Section 5.6
Absence of Certain Changes or Events.
(a)
From January 1, 2023, through the date of this Agreement, there has not been any event, change, effect or development that, individually
or in the aggregate, has had or would reasonably be expected to have a Parent Material Adverse Effect.
(b)
From January 1, 2023, through the date of this Agreement, except for events giving rise to, and the discussion and negotiation
of and other actions taken in connection with, this Agreement, Parent and each of its Subsidiaries have conducted their business in the
ordinary course of business in all material respects.
Section 5.7
No Undisclosed Material Liabilities. There are no liabilities of Parent or any of its Subsidiaries of any kind whatsoever,
whether accrued, contingent, absolute, determined, determinable or otherwise, other than: (a) liabilities reflected or reserved against
on the consolidated balance sheet of Parent dated as of December 31, 2022 (including the notes thereto), contained in the Parent SEC Documents
filed or furnished prior to the date hereof; (b) liabilities incurred in the ordinary course of business subsequent to December 31, 2022;
(c) liabilities incurred in connection with the preparation, negotiation and consummation of the Transactions; and (d) liabilities that
would not reasonably be expected to have, individually or in the aggregate, a Parent Material Adverse Effect.
Section 5.8
Information Supplied. None of the information supplied or to be supplied by or on behalf of Parent or Merger Sub for
inclusion or incorporation by reference in the Proxy Statement shall, at the date it is first mailed to the Company Shareholders and at
the time of the Company Shareholders Meeting, contain any untrue statement of a material fact or omit to state any material fact required
to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they are made, not
misleading.
Section 5.9 Parent
Permits; Compliance with Applicable Law. Parent and its Subsidiaries hold all permits, licenses, franchises, variances,
exemptions, orders and approvals of all Governmental Entities necessary for the lawful conduct of their respective businesses (the
“Parent Permits”), except where the failure to so hold would not reasonably be expected to have, individually or
in the aggregate, a Parent Material Adverse Effect. Parent and its Subsidiaries are in compliance with the terms of the Parent
Permits, except where the failure to so comply would not reasonably be expected to have, individually or in the aggregate, a Parent
Material Adverse Effect. Neither Parent nor any Subsidiary of Parent is in violation or breach of, or default under, any Parent
Permit, nor has Parent or any Subsidiary of Parent received any claim or notice indicating that Parent or any Subsidiary of Parent
is currently not in compliance with the terms of any Parent Permits, except where the failure to be in compliance with the terms of
any Parent Permits would not reasonably be expected to have, individually or in the aggregate, a Parent Material Adverse Effect. The
businesses of Parent and its Subsidiaries are not currently being conducted, and at no time since January 1, 2022, have been
conducted, in violation of any applicable Law, except for violations that would not reasonably be expected to have, individually or
in the aggregate, a Parent Material Adverse Effect. As of the date of this Agreement, no investigation or review by any Governmental
Entity with respect to Parent or any of its Subsidiaries is pending or, to the knowledge of Parent, threatened, other than those the
outcome of which would not reasonably be expected to have, individually or in the aggregate, a Parent Material Adverse Effect.
Notwithstanding anything to the contrary in this Section 5.9, the provisions of this Section 5.9 shall not apply to
matters addressed in Section 5.10, Section 5.11 or Section 5.12.
Section 5.10
Compensation; Benefits.
(a)
Set forth in Section 5.10(a) of the Parent Disclosure Letter is a list, as of the date hereof, of all of the material Employee
Benefit Plans sponsored, maintained, contributed to, or required to be contributed to by Parent or any of its Subsidiaries or with respect
to which Parent or any of its Subsidiaries has, or could reasonably be expected to have, any material liability (such Employee Benefit
Plans, whether or not material, the “Parent Plans”). True, correct and complete copies of each of the Parent Plans
(or, in the case of any unwritten Parent Plan, a written description thereof) and any amendments thereto and, as applicable, the most
current versions of any related trust agreements, insurance contracts or other funding arrangements, favorable determination or opinion
letters, and the most recent report on Form 5500 and summary plan description with respect to each such Parent Plan, in each case, have
been furnished or made available to the Company or its Representatives.
(b)
Each Parent Plan has been administered, funded (if applicable) and maintained in compliance with its terms and all applicable Laws.
(c)
Each Parent Plan that is intended to be a “qualified plan” within the meaning of Section 401(a) of the Code
has received a favorable determination letter, or may rely on a favorable opinion letter, issued by the IRS, and to the knowledge of Parent,
no events have occurred that would reasonably be expected to result in any such letter being revoked or in the loss of the qualified status
of any such Parent Plan.
(d)
As of the date of this Agreement, there are no actions, suits or claims pending (other than routine claims for benefits) or, to
the knowledge of Parent, threatened against, or with respect to, any of the Parent Plans, except for such pending actions, suits or claims
that would not reasonably be expected to have, individually or in the aggregate, a Parent Material Adverse Effect.
(e)
All material contributions required to be made to the Parent Plans pursuant to their terms have been timely made.
(f)
There are no material unfunded benefit obligations with respect to any Parent Plan that have not been properly accrued for in Parent’s
financial statements or disclosed in the notes thereto in accordance with GAAP.
(g)
Neither Parent nor any of its Subsidiaries or any of their ERISA Affiliates contributes to, has an obligation to contribute to
or otherwise has any liability (actual or contingent) with respect to, and no Parent Plan is, a plan subject to Title IV of ERISA (including
a multiemployer plan within the meaning of Section 3(37) of ERISA), Section 302 of ERISA, or Section 412 of the Code.
(h)
The execution and delivery of this Agreement and the consummation of the Transactions will not (either alone or in combination
with another event), (i) result in any payment or benefit from Parent or any of its Subsidiaries becoming due, or increase in the amount
of any compensation due, to any of their current or former respective officers, employees or consultants, (ii) materially increase any
benefits otherwise payable under any Parent Plan, (iii) to the knowledge of Parent, result in the acceleration of the time of payment
(including the funding of a trust or transfer of any assets to fund any benefits under any Parent Plan) or vesting of or otherwise trigger
any compensation or benefits payable to or in respect of any current or former employee, director or consultant of Parent or its Subsidiaries
or (iv) limit or restrict the right of Parent or any of its Subsidiaries to merge, amend or terminate any Parent Plan.
Section 5.11
Labor Matters.
(a)
As of the date of this Agreement, (i) neither Parent nor any of its Subsidiaries is a party to any collective bargaining agreement
or other agreement with any labor union, (ii) there is no pending union representation petition involving employees of Parent or any of
its Subsidiaries, and (iii) Parent does not have knowledge of any activity or proceeding of any labor organization (or representative
thereof) or employee group (or representative thereof) to organize any such employees.
(b)
As of the date of this Agreement, there is no unfair labor practice, charge or grievance arising out of a collective bargaining
agreement, other agreement with any labor union, or other labor-related grievance proceeding against Parent or any of its Subsidiaries
pending, or, to the knowledge of Parent, threatened.
(c)
As of the date of this Agreement, there is no strike, dispute, slowdown, work stoppage or lockout pending, or, to the knowledge
of Parent, threatened, against or involving Parent or any of its Subsidiaries.
(d) Parent
and each of its Subsidiaries are, and since January 1, 2022, have been, in compliance in all material respects with all applicable
Laws respecting employment and employment practices, terms and conditions of employment, wages and bonus, equal employment
opportunity, hours, overtime pay, non-discrimination, non-retaliation, non-harassment, civil rights, labor relations, occupational
health and safety, employee privacy, worker classification and payroll taxes, and there are no Proceedings pending or, to the
knowledge of Parent, threatened against Parent or any of its Subsidiaries, by or on behalf of any applicant for employment, any
current or former employee, independent contractor or any class of the foregoing, relating to any of the foregoing applicable Laws,
or alleging breach of any express or implied contract of employment, wrongful termination of employment, or alleging any other
discriminatory, wrongful or tortious conduct in connection with the employment or independent contractor relationship. Since January
1, 2023, neither Parent nor any of its Subsidiaries has received any written notice of the intent of the Equal Employment
Opportunity Commission, the National Labor Relations Board, the Department of Labor or any other Governmental Entity responsible for
the enforcement of labor or employment Laws to conduct an investigation with respect to Parent or any of its Subsidiaries.
Section 5.12
Taxes.
(a)
Parent and each of its Subsidiaries have (i) duly and timely filed (or there have been filed on their behalf) with the appropriate
Taxing Authority all U.S. Federal income and all other material Tax Returns required to be filed by them, taking into account any extensions
of time within which to file such Tax Returns, and all such Tax Returns were and are correct and complete in all material respects, and
(ii) duly and timely paid in full (or there has been duly and timely paid in full on their behalf) all material amounts of Taxes required
to be paid by them other than Taxes that are not yet due and payable or that are being contested in good faith by appropriate Proceedings
and for which adequate reserves have been established in accordance with GAAP.
(b)
The unpaid Taxes of Parent and its Subsidiaries (i) did not as of the date of the most recent financial statement exceed the reserve
for Taxes set forth on the face of the most recent financial statement (rather than in any notes thereto) and (ii) will not exceed that
reserve as adjusted for the passage of time through the Closing Date in accordance with the past custom and practice of Parent (and its
Subsidiaries) in filing the applicable Tax Returns. Since the date of the most recent financial statement, none of Parent nor any Company
Subsidiary has incurred any liability for Taxes outside the ordinary course of business.
(c)
(i) There are no audits, investigations by any Governmental Entity or other proceedings pending or, to the knowledge of Parent,
threatened in writing with regard to any Taxes or Tax Returns of Parent or any of its Subsidiaries; (ii) no deficiency for Taxes of Parent
or any of its Subsidiaries has been claimed, proposed or assessed in writing or, to the knowledge of Parent, threatened in writing, by
any Governmental Entity, which deficiency has not yet been settled ; (iii) neither Parent nor any of its Subsidiaries has waived any statute
of limitations with respect to the assessment of Taxes or agreed to any extension of time with respect to any Tax assessment or deficiency
for any open tax year (other than pursuant to extensions of time to file Tax Returns obtained in the ordinary course); (iv) neither Parent
nor any of its Subsidiaries is currently the beneficiary of any extension of time within which to file any Tax Return that remains unfiled;
and (v) neither Parent nor any of its Subsidiaries has entered into any “closing agreement” as described in Section
7121 of the Code (or any corresponding or similar provision of state, local or foreign income Tax Law).
(d) None
of Parent nor any Company Subsidiary will be required to include any item of income in, or exclude any item of deduction from,
taxable income for any taxable period (or portion thereof) ending after the Closing Date as a result of any: (i) change in or
improper use of method of accounting (other than by virtue of one or more of the transactions contemplated by this Agreement) for a
taxable period ending on or prior to the Closing Date under Code Section 481(c) (or any corresponding or similar provision of
state, local or foreign income Tax Law) or other provisions of applicable Law; (ii) “closing agreement” as
described in Code Section 7121 (or any corresponding or similar provision of state, local or foreign income Tax Law) executed on or
prior to the Closing Date; (iii) installment sale or open transaction made on or prior to the Closing Date, (iv) prepaid amount or
deferred revenue received on or prior to the Closing Date other than in the ordinary course of business, (v) intercompany
transaction or excess loss account described in Treasury Regulations under Section 1502 of the Code (or any corresponding or similar
provision of state, local, or non-U.S. Tax law); or (vi) an election under Section 965(h) of the Code (or any corresponding or
similar provision of state, local or non-U.S. law).
(e)
Parent and its Subsidiaries have complied, in all material respects, with all applicable Laws relating to the payment and withholding
of Taxes (including withholding of Taxes pursuant to Sections 1441, 1442, 1445, 1446, 1471, 3102 and 3402 of the Code or similar provisions
under any state and foreign Laws) and have duly and timely withheld and, in each case, have paid over to the appropriate Taxing Authority
all amounts required to be so withheld and paid over on or prior to the due date thereof under all applicable Laws.
(f)
There are no Tax Liens upon any property or assets of Parent or any of its Subsidiaries except for Liens for Taxes not yet due
and payable or that are being contested in good faith by appropriate proceedings and for which adequate reserves have been established
in accordance with GAAP.
(g)
Neither Parent nor any of its Subsidiaries has requested, has received or is subject to any written ruling of a Taxing Authority.
(h)
There are no Tax allocation or sharing agreements or similar arrangements with respect to or involving Parent or any of its Subsidiaries,
and after the Closing Date neither Parent nor any of its Subsidiaries shall be bound by any such Tax allocation agreements or similar
arrangements or have any liability thereunder for amounts due in respect of periods prior to the Closing Date, in each case, other than
customary provisions of commercial or credit agreements.
(i)
Neither Parent nor any of its Subsidiaries (i) has been a member of an affiliated group filing a consolidated U.S. federal income
Tax Return or (ii) has any liability for the Taxes of any Person (other than any Subsidiary of Parent) under Treasury Regulation Section 1.1502-6
(or any similar provision of state, local or foreign Tax Law), as a transferee or successor, or otherwise by Law.
(j)
Neither Parent nor any of its Subsidiaries has participated in any “reportable transaction” within the meaning
of Treasury Regulation Section 1.6011-4(b).
(k)
Neither Parent nor any of its Subsidiaries has constituted either a “distributing corporation” or a “controlled
corporation” (within the meaning of Section 355(a)(1)(A) of the Code) in a distribution of stock qualifying for tax-free
treatment under Section 355 of the Code in the two years prior to the date of this Agreement.
(l)
No written power of attorney that has been granted by Parent or any of its Subsidiaries (other than to Parent or any of its Subsidiaries)
is currently in force with respect to any matter relating to Taxes.
(m) Neither
Parent nor any of its Subsidiaries (i) has elected to defer the payment of any Taxes pursuant to Section 2302 of the CARES Act or
any other COVID-19 Measures or (ii) has claimed any “employee retention credit” pursuant to Section 2301 of the
CARES Act.
Section 5.13
Litigation. Except for such matters as would not reasonably be expected to have, individually or in the aggregate, a
Parent Material Adverse Effect, there is no (a) Proceeding pending or, to the knowledge of Parent, threatened against Parent or any of
its Subsidiaries or any of their respective properties, rights or assets or (b) judgment, decree, or injunction, ruling or order, in each
case, of any Governmental Entity or arbitrator outstanding against Parent or any of its Subsidiaries.
Section 5.14
Intellectual Property.
(a)
Section 5.14(a) of the Parent Disclosure Letter identifies each item of material Parent Intellectual Property that is the
subject of a registration or application in any jurisdiction (“Parent Registered Intellectual Property”), including,
with respect to each patent and patent application: (i) the name of the applicant/registrant, (ii) the jurisdiction of application/registration,
(iii) the application or registration number and (iv) any other co-applicants/co-owners. To the knowledge of Parent, each of the patents
and patent applications included in Section 5.14(a) of the Parent Disclosure Letter properly identifies by name each and every
inventor of the inventions claimed therein as determined in accordance with applicable Laws of the United States. To the knowledge of
Parent, as of the date of this Agreement, no litigation, cancellation, interference, derivation proceeding, opposition, inter partes review,
post grant review, reexamination or other proceeding of any nature (other than office actions or similar communications issued by any
Governmental Entity in the ordinary course of prosecution of any pending applications for registration) is pending or threatened in writing,
in which the scope, validity, enforceability or ownership of any Parent Intellectual Property is being or has been contested or challenged.
Except as set forth in Section 5.14(a) of the Parent Disclosure Letter, there are no actions that must be taken within ninety (90)
days of the Closing, the failure of which will result in the abandonment, lapse or cancellation of any Parent Registered Intellectual
Property.
(b)
Except as has not had and would not reasonably be expected to have, individually or in the aggregate, a Parent Material Adverse
Effect, Parent and its Subsidiaries exclusively own, are the sole assignees of, or have exclusively licensed all material Parent Intellectual
Property (other than as disclosed on Section 5.14(b) of the Parent Disclosure Letter), free and clear of all Liens other than Permitted
Liens. All material Parent Intellectual Property that is licensed to Parent or any of its Subsidiaries is licensed pursuant to a written
agreement. To the knowledge of Parent, each Parent Associate involved in the creation or development of any material Parent Intellectual
Property, pursuant to such Parent Associate’s activities on behalf of Parent or any of its Subsidiaries, has signed a valid and
enforceable written agreement containing an assignment of such Parent Associate’s rights in such Parent Intellectual Property to
Parent or such Subsidiary. Each Parent Associate who has or has had access to trade secrets or confidential information of Parent or any
of its Subsidiaries has signed a valid and enforceable written agreement containing confidentiality provisions protecting the Parent Intellectual
Property, trade secrets and confidential information. To the knowledge of Parent, Parent and its Subsidiaries have taken commercially
reasonable steps to protect and preserve the confidentiality of their trade secrets and confidential information.
(c)
To the knowledge of Parent, no funding, facilities or personnel of any Governmental Entity or any university, college, research
institute or other educational institution has been used to create Parent Intellectual Property, except for any such funding or use of
facilities or personnel that does not result in such Governmental Entity or institution obtaining ownership rights or a license to such
Parent Intellectual property or the right to receive royalties for the practice of such Parent Intellectual Property.
(d)
Section 5.14(d) of the Parent Disclosure Letter sets forth each license agreement pursuant to which Parent or any of its
Subsidiaries (i) is granted a license under any material Intellectual Property owned by any third party that is used by Parent or a Subsidiary
of Parent in its business as currently conducted (each a “Parent In-bound License”) or (ii) grants to any third party
a license under any material Parent Intellectual Property (each a “Parent Out-bound License”) (provided, that,
Parent In-bound Licenses shall not include, when entered into in the ordinary course of business, material transfer agreements, services
agreements, clinical trial agreements, agreements with Parent Associates, commercially available Software-as-a-Service offerings or off-the-shelf
software licenses; and Parent Out-bound Licenses shall not include, when entered into in the ordinary course of business, material transfer
agreements, clinical trial agreements, services agreements, or non-exclusive outbound licenses). To the knowledge of Parent, all Parent
In-bound Licenses and Parent Out-bound Licenses are in full force and effect and are binding obligations of Parent or a Subsidiary of
Parent and, to the knowledge of Parent, each other party to such Parent In-bound Licenses or Parent Out-bound Licenses. Neither Parent
or a Subsidiary of Parent who is a party to such Parent In-bound Licenses or Parent Out-bound Licenses, nor to the knowledge of Parent,
any other party to such Parent In-bound Licenses or Parent Out-bound Licenses, is in material breach under such Parent In-bound Licenses
or Parent Out-bound Licenses.
(e)
To the knowledge of Parent, (i) the operation of the businesses of Parent and its Subsidiaries as currently conducted does not
infringe, misappropriate or otherwise violate any Intellectual Property of any other Person and (ii) no other Person is infringing, misappropriating
or otherwise violating any Parent Intellectual Property. To the knowledge of Parent, no legal proceeding is pending (or, to the knowledge
of Parent and its Subsidiaries, is threatened in writing) (A) against Parent or any of its Subsidiaries alleging that the operation of
the business of Parent or such Subsidiary infringes or constitutes the misappropriation or other violation of any Intellectual Property
of another Person or (B) by Parent or any of its Subsidiaries alleging that another Person has infringed, misappropriated or otherwise
violated any of the Parent Intellectual Property. Since January 1, 2022, Parent and its Subsidiaries have not received any written notice
or other written communication alleging that the operation of the business of Parent or any of its Subsidiaries infringes or constitutes
the misappropriation or other violation of any Intellectual Property of another Person.
(f)
To the knowledge of Parent, none of the Parent Intellectual Property is subject to any pending or outstanding injunction, directive,
order, judgment or other disposition of dispute that adversely and materially restricts the use, transfer, registration or licensing by
Parent or any of its Subsidiaries of any such Parent Intellectual Property.
(g) Parent
has taken commercially reasonable steps and implemented commercially reasonable disaster recovery and security plans and procedures
to protect the information technology systems used in, material to or necessary for operation of the business of Parent as currently
conducted from unauthorized use, acquisition or access. To the knowledge of Parent, there have been no material malfunctions or
unauthorized intrusions, or breaches of the information technology systems used in, material to or necessary for the operation of
the business of Parent as currently conducted.
Section 5.15
Real Property. Neither Parent nor any Subsidiary of Parent owns any real property, other than as and to the extent disclosed
in Section 5.15 of the Parent Disclosure Letter or the Parent SEC Documents filed or furnished with the SEC prior to the date hereof.
Neither Parent nor any Subsidiary of Parent has leased or subleased any real property and does not have any obligation to pay any rent
or other fees for any real property other than as and to the extent disclosed in the Parent SEC Documents filed or furnished with the
SEC prior to the date hereof.
Section 5.16
Material Contracts.
(a)
Section 5.16(a) of the Parent Disclosure Letter sets forth a true and complete list, as of the date of this Agreement, of:
(i)
each contract that grants any right of first refusal or right of first offer or that materially limits the ability of Parent, any
Subsidiary of Parent or any of their respective Affiliates to own, operate, sell, transfer, pledge or otherwise dispose of any businesses,
securities or assets (other than provisions requiring notice of or consent to assignment by any counterparty thereto);
(ii)
each contract relating to outstanding Indebtedness (or commitments or guarantees in respect thereof) of Parent or any of its Subsidiaries
(whether incurred, assumed, guaranteed or secured by any asset) in excess of $50,000;
(iii)
each employment contract to which Parent or a Subsidiary of Parent is a party other than employment contracts that can be terminated
at any time with less than two days’ notice and without financial liability to Parent or any of its Subsidiaries;
(iv)
each contract that involves or constitutes a material interest rate cap, interest rate collar, interest rate swap or other contract
or agreement relating to a forward, swap or other hedging transaction of any type, unless entered into for bona fide hedging purposes;
(v)
each contract containing any non-compete, non-solicit, exclusivity or similar type of provision that materially restricts the ability
of Parent or any of its Subsidiaries to compete or otherwise engage in any line of business or with any Person or geographic area;
(vi)
each contract pursuant to which Parent or any Subsidiary of Parent may be obligated to issue or repurchase any Parent Capital Stock
or any capital stock or other equity interests in any Subsidiary of Parent;
(vii) each
partnership, joint venture, limited liability company, strategic alliance agreement or other similar agreement to which Parent or a
Subsidiary of Parent is a party (other than any such agreement solely between or among Parent and its wholly-owned
Subsidiaries);
(viii)
each contract, other than any Parent Plan, between or among Parent or any Subsidiary of Parent, on the one hand, and any officer,
director or affiliate (other than a wholly owned Subsidiary of Parent) of Parent or any of its Subsidiaries or any of their respective
“associates” or “immediate family” members (as such terms are defined in Rule 12b-2 and Rule 16a-1
of the Exchange Act), on the other hand;
(ix)
each contract that obligates Parent or any of its Subsidiaries to indemnify any past or present directors, officers, or employees
of Parent or any of its Subsidiaries; and
(x)
each “material contract” (as such term is defined in Item 601(b)(10) of Regulation S-K under the Exchange Act)
not otherwise described in this Section 5.16(a) with respect to Parent or any Subsidiary of Parent.
(b)
Collectively, the contracts set forth in Section 5.16(a) are herein referred to as the “Parent Contracts.”
Except as would not reasonably be expected to have, individually or in the aggregate, a Parent Material Adverse Effect, each Parent Contract
is legal, valid, binding and enforceable in accordance with its terms on Parent and each of its Subsidiaries that is a party thereto and,
to the knowledge of Parent, each other party thereto, and is in full force and effect, subject, as to enforceability, to Creditors’
Rights. Except as would not reasonably be expected to have, individually or in the aggregate, a Parent Material Adverse Effect, neither
Parent nor any of its Subsidiaries is in breach or default under any Parent Contract nor, to the knowledge of Parent, is any other party
to any such Parent Contract in breach or default thereunder. Complete and accurate copies of each Parent Contract in effect as of the
date hereof (including all amendments and modifications) have been furnished to or otherwise made available to the Company. Neither Parent
nor any of its Subsidiaries has received written notice of any material violation of or material default under any Parent Contract.
Section 5.17
Insurance. To the knowledge of Parent, (a) all current, material insurance policies of Parent and each of its Subsidiaries
(collectively, the “Material Parent Insurance Policies”) are in full force and effect and (b) all premiums payable
under the Material Parent Insurance Policies prior to the date of this Agreement have been duly paid to date. As of the date of this Agreement,
no written notice of cancellation or termination has been received with respect to any Material Parent Insurance Policy.
Section 5.18
Brokers. No broker, investment banker or other Person is entitled to any broker’s, finder’s or other similar
fee or commission in connection with the Transactions based upon arrangements made by or on behalf of Parent or any of its Subsidiaries.
Section 5.19
State Takeover Statute. The Parent Board has taken all action necessary to render exempt or inapplicable to the Merger
and the other Transactions (a) the provisions of the DGCL and (b) to the extent applicable to Parent, any other Takeover Law. Except as
set forth in Section 4.20, no other Takeover Laws are applicable to this Agreement, the Merger or the other Transactions.
Section 5.20 Investment
Company Act. Neither
Parent nor any of its Subsidiaries is, or as of immediately prior to the Effective Time will be, required to be registered as an investment
company under the Investment Company Act.
Section 5.21
Ownership of Company Capital Stock. Neither Parent nor any Subsidiary of Parent nor any of their respective affiliates
or associates (as defined in Rule 12b-2 of the Exchange Act) beneficially owns or in the past three years has owned, directly or indirectly,
or has the right to acquire (whether such right is exercisable immediately or only after the passage of time), pursuant to any agreement,
arrangement or understanding or upon the exercise of conversion rights, exchange rights, warrants or options, or otherwise, or the right
to vote pursuant to any agreement, arrangement or understanding, any shares of Company Common Stock, Company Preferred Stock or other
securities convertible into, exchangeable for or exercisable for shares of Company Common Stock, Company Preferred Stock or any securities
of any Subsidiary of the Company and neither Parent nor any of its Subsidiaries has any rights to acquire any shares of Company Common
Stock or Company Preferred Stock except pursuant to this Agreement. Neither Parent nor any its Subsidiaries is an affiliate or associate
(as defined in Rule 12b-2 of the Exchange Act) of the Company. Neither Parent nor any of the Subsidiaries of Parent has at any time been
an assignee or has otherwise succeeded to the beneficial ownership of any shares of Company Common Stock or Company Preferred Stock during
the last two years.
Section 5.22
Business Conduct. Merger Sub was formed on October 16, 2023. Since its inception, Merger Sub has not engaged in any
activity, other than such actions in connection with (a) its organization and (b) the preparation, negotiation and execution of this Agreement
and the Transactions. Merger Sub has no operations, has not generated any revenues and has no liabilities other than those incurred in
connection with the foregoing and in association with the Merger as provided in this Agreement.
Section 5.23
Related Party Transactions. Except as set forth in Section 5.23 of the Parent Disclosure Letter and as set forth
in the Parent SEC Documents filed through and including the date of this Agreement or as permitted by this Agreement, from January 1,
2021 through the date of this Agreement there have been no transactions, agreements, arrangements or understandings between the Parent
or any of its Subsidiaries, on the one hand, and any Affiliates (other than Subsidiaries of the Parent) of the Parent, on the other hand,
that would be required to be disclosed under Item 404 of Regulation S-K promulgated by the SEC. Section 4.21 of the Parent Disclosure
Letter sets forth each agreement between the Parent or any of its Subsidiaries, on the one hand, and any Affiliates (other than Subsidiaries
of the Parent) of Parent, on the other hand.
Section 5.24
FDA Regulatory.
(a) To
the Knowledge of Parent, Parent is, and has been, in compliance in all materials respects with all applicable Laws in the
jurisdictions in which Parent conducts business including but not limited to, as applicable (i) preclinical and clinical testing,
(ii) application for marketing approval of, manufacture, distribution, promotion and sale of Parent’s Products, (iii) the
requirement for and the terms of all necessary permits, (iv) establishment registration, (v) payment of all establishment fees, (vi)
Good Clinical Practices, (vii) Good Manufacturing Practices, and (viii) recordkeeping and reporting requirements. Parent is not in
default with respect to any order, writ, judgment, award, injunction or decree of any Governmental Entity or arbitrator applicable
to it, or any of its assets. Parent has not received, at any time during the prior five (5) years from the actual date of this
Agreement, any written notice from any Governmental Entity regarding any actual, alleged, or potential violation of, or failure to
comply with, any Law applicable to Parent in any material respect.
(b)
To the Knowledge of Parent, Parent and any suppliers, manufacturers, or other companies with which Parent contracts for services
related to Parent’s Products, holds FDA Permits and all other applicable local, state, and federal laws and regulations of the relevant
Governmental Entity engaged in the regulation of pharmaceuticals or biohazardous materials in the jurisdictions in which Parent performs
clinical trials and/or markets its products. All FDA Permits are in full force and effect in all material respects and no suspension,
revocation, cancellation, or withdrawal of such FDA Permits is threatened and there is no reasonable basis for believing that such FDA
Permits will not be renewable upon expiration or will be suspended, revoked, cancelled, or withdrawn.
(c)
Parent has not received any written notices or statements from the FDA, the EMEA or any other Governmental Entity, and otherwise
has no knowledge or reason to believe, that (i) any drug, including the Parent’s Products or other Potential Product of Parent may
or will be rejected or determined to be non-approvable; (ii) a delay in time for review and/or approval of a marketing authorization application
or marketing approval application in any jurisdiction for any Potential Product is or may be required, requested or being implemented;
(iii) one or more clinical studies for any Potential Product shall or may be requested or required in addition to the clinical studies
submitted to the FDA prior to the date hereof as a precondition to or condition of issuance or maintenance of a marketing approval for
any Potential Product; (iv) any license, approval, permit or authorization to conduct any clinical trial of or market any product or Potential
Product of Parent has been, will be or may be suspended, revoked, modified or limited. Parent has not marketed Potential Products in a
manner in any way suggesting that a Potential Product has been approved for an indication that exceeds the scope of the approved product
label. Parent is not aware of the results of any studies, tests or trials the which reasonably call into question the results of the tests
and trials conducted by or on behalf of Parent with respect to Potential Products.
(d)
Parent has not received any written notice or communication from any Governmental Entity of any actual or threatened investigation,
inquiry, or administrative, judicial, or regulatory action, hearing, or enforcement proceeding against Parent regarding any violation
of applicable FDA Law or other applicable local, state, and federal laws and regulations of the relevant Governmental Entity engaged in
the regulation of pharmaceuticals or biohazardous materials, including but not limited to a notice of adverse finding, warning letter,
clinical hold notice, recall, field correction, market withdrawal or replacement, safety alert, “dear doctor” letter,
investigator notice, or other notice or action relating to an alleged or potential lack of safety or efficacy of any product of Parent,
any alleged product defect of any product of Parent, or any violation of any material applicable law, rule, regulation or any clinical
trial or marketing license, approval, permit or authorization for any product of Parent, and Parent is not aware of any facts or information
that would cause it to initiate any such notice or action and has no knowledge or reason to believe that the FDA, the EMEA or any other
Governmental Entity or authority or any institutional or ethical review board or other non-governmental authority intends to impose, require,
request or suggest any material obligation arising under an investigation, inquiry, or administrative, judicial, or regulatory action,
hearing, or enforcement proceeding.
(e)
In the last five (5) years, Parent has not been party to any corporate integrity agreement, monitoring agreement, consent decree,
settlement order, or other similar written agreement, in each case, entered into with or imposed by the FDA. Neither Parent no, to the
Knowledge of Parent, any of its officers, employees, or agents, or any manufacturers, distributor, or other entity in Parent’s supply
chain, has been or is currently disqualified or debarred, suspended, proposed for debarment or suspensions, deemed non-responsible, or
otherwise excluded from the award of contracts or from participating in any Federal healthcare program by any Federal agency or other
Governmental Entity. Neither Parent nor, to the Knowledge of Parent, any of its officers, employees, or agents has made an untrue statement
of a material fact or a fraudulent statement to the FDA or failed to disclose a material fact required to be disclosed to the FDA, in
each of the foregoing cases on behalf of Parent.
(f)
No officer, employee, or agent of Parent is or has been, or has been threatened to be: (a) debarred under FDA proceedings pursuant
to 21 U.S.C. § 335a; (b) disqualified under FDA investigator qualification proceedings; (c) subject to the FDA’s Application
Integrity Policy; or (d) subject to any enforcement proceeding arising from material false statements to the FDA pursuant to 18 U.S.C.
§ 1001.
(g)
Neither Parent nor any of its managers, directors, officers, agents, or employees have (i) used any corporate funds of Parent for
unlawful contributions, gifts, entertainment or other unlawful expenses related to political activity, (ii) made any unlawful payments
to foreign or domestic government officials or employees or to foreign or domestic political parties or campaigns from corporate funds
or violated any provision of the U.S. Foreign Corrupt Practices Act of 1977, as amended, or any other U.S. or foreign Laws concerning
corrupt payments applicable to its business or (iii) made or received any other payment, contribution, gift, bribe, rebate, payoff or
kick-back prohibited under any applicable Law. Neither Parent nor any of its managers, directors, officers, stockholders, agents, or employees
is or has been the subject of any investigation, inquiry or enforcement Proceeding by any Governmental Entity regarding any offense or
alleged offense under anti-bribery, anti-corruption, or anti-fraud Law in any jurisdiction and, no such investigation, inquiry or Proceedings
have been threatened.
Section 5.25
No Additional Representations.
(a)
Except for the representations and warranties made in this Article V, neither Parent, Merger Sub nor any other Person makes
any express or implied representation or warranty with respect to Parent or its Subsidiaries (including Merger Sub) or their respective
businesses, operations, assets, liabilities or conditions (financial or otherwise) in connection with this Agreement or the Transactions,
and Parent hereby disclaims any such other representations or warranties. In particular, without limiting the foregoing disclaimer, neither
Parent nor any other Person makes or has made any representation or warranty to the Company or any of its Affiliates or Representatives
with respect to (i) any financial projection, forecast, estimate, budget or prospect information relating to Parent or any of its Subsidiaries
or their respective properties, assets or businesses or (ii) except for the representations and warranties made by Parent in this Article
V, any oral or written information presented to the Company or any of its Affiliates or Representatives in the course of their due
diligence investigation of Parent, the negotiation of this Agreement or in the course of the Transactions.
(b)
Notwithstanding anything contained in this Agreement to the contrary, each of Parent and Merger Sub acknowledges and agrees that
none of the Company or any other Person has made or is making, and each of Parent and Merger Sub expressly disclaims reliance upon, any
representations, warranties or statements relating to the Company or its Subsidiaries whatsoever, express or implied, beyond those expressly
given by the Company in Article IV, the Company Disclosure Letter or in any other document or certificate delivered by the Company
or its Affiliates or Representatives in connection herewith, including any implied representation or warranty as to the accuracy or completeness
of any information regarding the Company or its Subsidiaries furnished or made available to Parent or any of its Affiliates or Representatives.
Without limiting the generality of the foregoing, each of Parent and Merger Sub acknowledges that no representations or warranties are
made with respect to any projections, forecasts, estimates, budgets or prospect information that may have been made available to Parent
or any of its Affiliates or Representatives (including in certain “data rooms,” “virtual data rooms,”
management presentations or in any other form in expectation of, or in connection with, the Merger or the other Transactions).
Article
VI
COVENANTS AND AGREEMENTS
Section 6.1
Conduct of Company Business Pending the Merger.
(a)
The Company agrees that, except (i) as set forth in Section 6.1(a) of the Company Disclosure Letter, (ii) for any transaction,
contract or other business arrangement entered into or agreed by any Person set forth on Section 4.1(c) of the Company Disclosure
Letter, including but not limited to any issuance of securities by such Person or any sale or acquisition of any assets by such Person,
(iii) as permitted or required by this Agreement, (iii) as may be required by applicable Law or (iv) as otherwise consented to by Parent
in writing (which consent shall not be unreasonably withheld, delayed or conditioned), until the earlier of the Effective Time and the
termination of this Agreement pursuant to Article VIII, the Company shall, and shall cause each of its Subsidiaries to, use commercially
reasonable efforts to (1) conduct its businesses (I) in the ordinary course of business in all material respects and (II) in compliance
in all material respects with applicable Laws and (2) preserve substantially intact its present business organization and preserve its
existing relationships with its key business relationships, vendors, counterparties and employees; provided, however, that
no action by the Company or its Subsidiaries with respect to the matters specifically addressed by any provision of Section 6.1(b)
shall be deemed a breach of this sentence unless such action would constitute a breach of such other provision of Section 6.1(b).
(b)
Except (v) as set forth in Section 6.1(b) of the Company Disclosure Letter, (w) as permitted or required by this Agreement
(including as contemplated by the Original Agreement, any amendment to the Original Agreement or Section 6.10 of this Agreement),
(x) for any transaction, contract or other business arrangement entered into or agreed by any Person set forth on Section 4.1(c)
of the Company Disclosure Letter, including but not limited to any issuance of securities by such Person or any sale or acquisition of
any assets by such Person, (y) as may be required by applicable Law or (z) as otherwise consented to by Parent in writing (which consent
shall not be unreasonably withheld, delayed or conditioned), until the earlier of the Effective Time and the termination of this Agreement
pursuant to Article VIII, the Company shall not, and shall not permit any of its Subsidiaries to:
(i)
(A) authorize, declare, set aside or pay any dividends on, or make any other distribution (whether in cash, stock, property or
otherwise) in respect of any outstanding capital stock of, or other equity interests in, the Company or any of its Subsidiaries; (B) split,
combine or reclassify any capital stock of, or other equity interests in, the Company or any of its Subsidiaries (other than for transactions
by a wholly-owned Subsidiary of the Company); or (C) purchase, redeem or otherwise acquire, or offer to purchase, redeem or otherwise
acquire, any capital stock of, or other equity interests in, the Company, except as required by the Organizational Documents of the Company
or any Subsidiary of the Company, any Company Plan or any Company Warrant, in each case, existing as of the date hereof (or granted following
the date of this Agreement in accordance with the terms of this Agreement);
(ii)
offer, issue, deliver, grant or sell, or authorize or propose to offer, issue, deliver, grant or sell, any capital stock of, or
other equity interests in, the Company or any of its Subsidiaries or any securities convertible into or exchangeable for, or any rights,
warrants or options to acquire, any such capital stock or equity interests (including the grant of new equity-based awards under the Company
Plans), other than the issuance of Company Capital Stock upon exercise or exchange of any Company Warrants or Company Convertible Notes
outstanding on the date hereof;
(iii)
(A) amend or propose to amend the Company’s Organizational Documents or (B) amend or propose to amend the Organizational
Documents of any of the Company’s Subsidiaries;
(iv)
(A) merge, consolidate, combine or amalgamate with any Person other than another entity in which the Company or its Subsidiaries
own an interest, whether direct or indirect, or (B) acquire or agree to acquire (including by merging or consolidating with, purchasing
any equity interest in or a substantial portion of the assets of, licensing, or by any other manner) any assets or any business or any
corporation, partnership, association or other business organization or division thereof, in each case other than transactions between
the Company and a Subsidiary of the Company or between or among Subsidiaries of the Company;
(v)
sell, lease or otherwise dispose of, or agree to sell, lease or otherwise dispose of, any material portion of its assets;
(vi)
adopt a plan of complete or partial liquidation or dissolution of the Company or any of its Subsidiaries;
(vii)
change in any material respect its accounting principles, practices or methods in a manner that would materially affect the consolidated
assets, liabilities or results of operations of the Company or any of its Subsidiaries, except as required by GAAP or applicable Law;
(viii) make
or change any Tax election, adopt or change any Tax accounting period or material method of Tax accounting, file any amended Tax
Return, settle or compromise any liability for Taxes or any Tax audit or other proceeding relating to Taxes, enter into any closing
or similar agreement with any Taxing Authority, surrender any right to claim a material refund of Taxes or agree to any extension or
waiver of the statute of limitations;
(ix)
grant any increases in the compensation payable or to become payable to any of its directors, officers or any other employees (including
Business Employees) other than in the ordinary course of business; (B) establish, grant or provide any new cash bonuses or any new cash
bonus plan, program, arrangement, agreement or practice for any directors, officers, employees (including Business Employees), consultants
or other service providers; (C) establish any Employee Benefit Plan which was not in existence prior to the date of this Agreement, or
amend any Company Plan in existence on the date of this Agreement if such amendment would have the effect of enhancing or materially increasing
any benefits thereunder; (D) accelerate the vesting, payment or settlement of any compensation or benefit; or (E) hire any new employees
other than to fill existing vacancies or as necessary to maintain the ordinary course of business, or transfer or terminate the service
of any employee other than any such termination for cause;
(x)
establish or become obligated under any collective bargaining agreement, memorandum of understanding, or other contract with a
labor union, labor organization, works council or similar representative of employees;
(xi)
make any loans, advances or capital contributions to any other Person in excess of $50,000 in the aggregate, except for (A) funding
of commitments in the ordinary course of business and in accordance with the terms of any agreements in effect as of the date hereof,
(B) loans among the Company and its Subsidiaries or among the Company’s Subsidiaries consistent with past practice, (C) advances
for reimbursable employee expenses in the ordinary course of business, (D) advancement of reasonable legal expenses or (E) any indemnification
agreement in effect on the date hereof;
(xii)
(A) enter into any contract that would be a Company Contract or (B) modify, amend, terminate or assign, or waive or assign
any material rights under, any Company Contract (or any contract that, if existing as of the date hereof, would be a Company Contract),
except in the ordinary course of business, and, for the avoidance of doubt, with respect to clauses (A) and (B), except
for: (1) any termination, renewal or extension in accordance with the terms of any existing Company Contract that occurs automatically
without any action (other than notice of renewal or extension) by Company or any Subsidiary of the Company; or (2) any trade agreements
entered into, modified, amended, terminated or assigned in the ordinary course of business provided that, in each case, no such
action will result in a Company Material Adverse Effect or otherwise impede the Transactions;
(xiii) other
than the settlement of any Proceeding (A) reflected or reserved against on the balance sheet of the Company (or in the notes
thereto), (B) that would not reasonably be expected to restrict the operations of the Company and its Subsidiaries after the
Effective Time or (C) in connection with any shareholder litigation against the Company and/or its employees, officers or directors
relating to this Agreement, the Merger and/or the other Transactions in accordance with Section 6.11, settle, or offer or
propose to settle, any Proceeding against the Company or any of its Subsidiaries (excluding any audit, claim or other proceeding in
respect of Taxes) involving a payment or other transfer of value by the Company or any of its Subsidiaries exceeding $50,000
individually, or $100,000 in the aggregate;
(xiv)
make or agree to make any new capital expenditure or expenditures that, individually, is in excess of $50,000 or, in the aggregate,
are in excess of $100,000;
(xv)
other than the Loan or the issuance of Company Capital Stock upon exercise or exchange of any Company Warrants or Company Convertible
Notes outstanding on the date hereof, incur, create, assume, refinance, replace or prepay in any material respects the terms of any Indebtedness
or any derivative financial instruments or arrangements, or issue or sell any debt securities or calls, options, warrants or other rights
to acquire any debt securities (directly, contingently or otherwise); provided, however, that the foregoing shall not restrict
the incurrence of any Indebtedness among the Company and its Subsidiaries or among the Company’s Subsidiaries;
(xvi)
enter into any new line of business;
(xvii)
take any action, or fail to take any action, which action or failure would reasonably be expected to cause the Company or any of
its Subsidiaries to be required to be registered as an investment company under the Investment Company Act;
(xviii)
enter into any transactions or contracts with any Affiliates (other than directors or officers in their capacities as such) of
the Company; or
(xix)
authorize, agree or enter into any arrangement or understanding to take any action that is prohibited by this Section 6.1(b).
Notwithstanding anything to
the contrary set forth in this Agreement, nothing in this Agreement shall prohibit the Company or any of its Subsidiaries from taking
any action, at any time or from time to time, that in the reasonable judgment of the Company, upon advice of counsel, is reasonably necessary
for the Company to avoid being required to register as an investment company under the Investment Company Act; provided that prior
to taking any action under this paragraph, the Company shall provide Parent with reasonable advance notice of any proposed action and
shall in good faith discuss such proposed action with Parent. Further, notwithstanding anything to the contrary in this Agreement prior
to or following the execution hereof, in the event the Company has a termination right pursuant to Section 8.1(f), without affecting
such termination right or requiring the Company to exercise the same, Parent and Merger Sub hereby consent to the Company discussing,
negotiating and executing a letter of intent, memorandum of understanding or other binding or non-binding agreement with investors with
respect to a potential equity, debt or other investment in the Company.
Section 6.2
[Intentionally Omitted]
Section 6.3
[Intentionally Omitted]
Section 6.4 Indemnification;
Directors’ and Officers’ Insurance.
(a) Parent
agrees that all rights existing as of the date of this Agreement to indemnification, advancement of expenses and exculpation from
Indemnified Liabilities in favor of current and/or former directors, officers or employees of the Company or any of its Subsidiaries
as provided in the Organizational Documents of the Company or any such Subsidiary, any employment agreement or indemnification
agreement in effect on the date hereof or otherwise (which shall be assumed by Parent and the Surviving Company) will continue in
full force and effect in accordance with their terms, and Parent will cause the Surviving Company to perform its respective
obligations thereunder. Without limiting the foregoing, from and after the Effective Time, Parent and the Surviving Company shall,
jointly and severally, indemnify, defend and hold harmless each Person who is now, or has been at any time prior to the date of this
Agreement or who becomes prior to the Effective Time, a director or officer of the Company or any of its Subsidiaries or is or was
serving at the request of the Company or any of its Subsidiaries as a director or officer of another corporation, partnership,
limited liability company, joint venture, Employee Benefit Plan, trust or other enterprise (the “Indemnified
Persons”) against and from all losses, claims, damages, costs, fines, penalties, expenses (including attorneys’ and
other professionals’ fees and expenses), liabilities, judgments and amounts that are paid in settlement of, or incurred in
connection with any threatened or actual Proceeding to which such Indemnified Person is, was or becomes a party or is otherwise
involved (including as a witness) based, in whole or in part, on or arising, in whole or in part, out of the fact that such Person
is or was a director, officer, employee or agent of the Company or any of its Subsidiaries or is or was serving at the request of
the Company or any of its Subsidiaries as a director or officer of another corporation, partnership, limited liability company,
joint venture, Employee Benefit Plan, trust or other enterprise or by reason of anything done or not done by such Person in any such
capacity, whether pertaining to any act or omission occurring or existing prior to, at or after the Effective Time and whether
asserted or claimed prior to, at or after the Effective Time (“Indemnified Liabilities”), including all
Indemnified Liabilities based in whole or in part on, or arising in whole or in part out of, or pertaining to, this Agreement or the
Transactions, in each case, to the fullest extent permitted under applicable Law (and Parent and the Surviving Company shall,
jointly and severally, pay expenses incurred in connection therewith in advance of the final disposition of any such Proceeding to
each Indemnified Person to the fullest extent permitted under applicable Law). Without limiting the foregoing, in the event any such
Proceeding is brought or threatened to be brought against any Indemnified Persons (whether arising before or after the Effective
Time), (i) the Indemnified Persons may retain the Company’s regularly engaged legal counsel or other counsel satisfactory to
such Indemnified Person, and Parent and the Surviving Company shall pay all reasonable fees and expenses of such counsel for the
Indemnified Persons as promptly as statements therefor are received, and (ii) the Surviving Company shall use its reasonable best
efforts to assist in the defense of any such matter. With respect to any determination of whether any Indemnified Person is entitled
to indemnification by Parent or Surviving Company under this Section 6.4, such Indemnified Person shall have the right to
require that such determination be made by special, independent legal counsel selected by the Indemnified Person and approved by
Parent or Surviving Company, as applicable (which approval shall not be unreasonably withheld or delayed), and who has not otherwise
performed material services for Parent, Surviving Company, the Company or the Indemnified Person within the last three years.
Notwithstanding anything to the contrary contained in this Agreement, Parent shall not (and Parent shall cause the Surviving Company
not to) settle or compromise or consent to the entry of any judgment or otherwise seek termination with respect to any Proceeding
for which indemnification may be sought by an Indemnified Person pursuant to this Agreement, unless such settlement, compromise,
consent or termination includes an unconditional release of all Indemnified Persons from all liability arising out of such
Proceeding and does not include the imposition of equitable relief on, or the admission of fault or wrongdoing by, any Indemnified
Person.
(b)
For a period of six (6) years following the Effective Time, Parent and the Surviving Company shall not amend, repeal or otherwise
modify any provision in the Organizational Documents of the Surviving Company or its Subsidiaries in any manner that would affect adversely
the rights thereunder or under the Organizational Documents of the Surviving Company or any of its Subsidiaries of any Person to indemnification,
exculpation and expense advancement except to the extent required by applicable Law. Parent shall, and shall cause the Surviving Company
and its Subsidiaries to, fulfill and honor any indemnification, expense advancement or exculpation agreements between the Company or any
of its Subsidiaries and any of its directors, officers or employees existing immediately prior the Effective Time.
(c)
To the extent permitted by applicable Law, Parent and the Surviving Company shall indemnify any Indemnified Person against all
reasonable costs and expenses (including reasonable attorneys’ fees and expenses), such amounts to be payable in advance upon request
as provided in Section 6.4(a), relating to the enforcement of such Indemnified Person’s rights under this Section 6.4
or under any Organizational Documents of the Company or any of its Subsidiaries, any employment agreement or indemnification agreement
in effect on the date hereof or otherwise, regardless of whether such Indemnified Person is ultimately determined to be entitled to indemnification
hereunder or thereunder.
(d)
Parent and the Surviving Company shall put in place, and Parent shall fully prepay immediately prior to the Effective Time, “tail”
insurance policies (collectively, the “D&O Insurance”) with a claims period of at least six years from the Effective
Time from an insurance carrier with the same or better credit rating as the Company’s current insurance carrier with respect to
directors’ and officers’ liability insurance, fiduciary liability insurance and employment practices liability insurance in
an amount and scope at least as favorable as the Company’s existing policies with respect to matters, acts or omissions existing
or occurring at or prior to the Effective Time; provided, however, that Parent shall not be required to pay an annual premium
for the D&O Insurance in excess of (for any one year) 150% of the annual premium paid by the Company for such insurance as of the
date of this Agreement; and provided, further, that if the annual premiums of such insurance coverage exceed such amount, Parent
shall be obligated to obtain a policy with the greatest coverage available, with respect to facts, acts, events or omissions occurring
prior to the Effective Time, for a cost not exceeding such amount.
(e) In
the event that Parent, the Surviving Company or any Subsidiary of the Surviving Company, or any of their respective successors or
assigns, (i) consolidates with or merges into any other Person and shall not be the continuing or surviving company or entity of
such consolidation or merger or (ii) transfers all or substantially all of its properties and assets to any Person, then, in each
such case, proper provisions shall be made so that the successors and assigns of Parent, the Surviving Company or such Subsidiary of
the Surviving Company, as the case may be, shall assume the obligations set forth in this Section 6.4. The provisions of this Section
6.4 are intended to be for the benefit of, and shall be enforceable by, the parties and each Person entitled to indemnification,
exculpation, insurance coverage or expense advancement or any other right pursuant to this Section 6.4, and his, her or its
heirs and representatives. The rights of the Indemnified Persons under this Section 6.4 are in addition to any rights such
Indemnified Persons may have under the Organizational Documents of the Company or any of its Subsidiaries, or under any applicable
contracts or Law. Parent and the Surviving Company shall pay all expenses, including attorneys’ fees, that may be incurred by
any Indemnified Person in enforcing the indemnity and other obligations provided in this Section 6.4.
Section 6.5
Preparation of Proxy Statement.
(a)
Parent will promptly furnish to the Company such data and information relating to it, its Subsidiaries (including Merger Sub) and
the holders of Parent Capital Stock, as the Company may reasonably request for the purpose of including such data and information in the
Proxy Statement and any amendments or supplements thereto used by the Company to obtain the Company Shareholder Approval.
(b)
The Company and shall cause to be filed with the SEC, within 30 calendar days following the date hereof, a mutually acceptable
Proxy Statement relating to the matters to be submitted to the holders of Company Common Stock at the Company Shareholders Meeting, which
will set forth the Merger Consideration and Exchange Ratios as finally determined pursuant to Section 3.1, The Company shall use
commercially reasonable efforts to cause the Proxy Statement to comply with the rules and regulations promulgated by the SEC and to respond
promptly to any comments of the SEC or its staff. The Company will advise Parent promptly after it receives any request by the SEC for
amendment of the Proxy Statement or comments thereon and responses thereto or any request by the SEC for additional information. Each
of the Company and Parent shall use commercially reasonable efforts to cause all documents that it is responsible for filing with the
SEC in connection with the Transactions to comply as to form and substance in all material respects with the applicable requirements of
the Securities Act and the Exchange Act. Notwithstanding the foregoing, prior to or mailing the Proxy Statement (or any amendment or supplement
thereto) or responding to any comments of the SEC with respect thereto, the Company will (i) provide Parent with an opportunity to review
and comment on such document or response (including the proposed final version of such document or response), (ii) include in such document
or response all comments reasonably proposed by Parent and (iii) not file or mail such document or respond to the SEC prior to receiving
the approval of Parent, which approval shall not be unreasonably withheld, conditioned or delayed; provided, however, that
with respect to documents filed by a party that are incorporated by reference in the Proxy Statement, this right of approval shall apply
only with respect to information relating to Parent, its Subsidiaries and its Affiliates, their business, financial condition or results
of operations or the Transactions; and provided, further that the Company, in connection with any Company Change of Recommendation,
may amend or supplement the Proxy Statement (including by incorporation by reference) and make other filings with the SEC, to effect such
Company Change of Recommendation.
(c)
Parent and the Company each shall make all necessary filings with respect to the Merger and the Transactions under the Securities
Act and the Exchange Act and applicable blue-sky laws and the rules and regulations thereunder.
(d)
If at any time prior to the Effective Time, any information relating to Parent or the Company, or any of their respective Affiliates,
officers or directors, should be discovered by Parent or the Company that should be set forth in an amendment or supplement to the Proxy
Statement, so that such documents would not include any misstatement of a material fact or omit to state any material fact necessary to
make the statements therein, in light of the circumstances under which they were made, not misleading, the party that discovers such information
shall promptly notify the other party and an appropriate amendment or supplement describing such information shall be promptly filed with
the SEC and, to the extent required by applicable Law, disseminated to the Company Shareholders.
Section 6.6
Shareholders Meeting. The Company shall take all action necessary in accordance with applicable Laws and the Organizational
Documents of the Company to duly give notice of, convene and hold a meeting of its shareholders for the purpose of obtaining the Company
Shareholder Approval, to be held as promptly as reasonably practicable following the clearance of the Proxy Statement by the SEC. The
Company shall, through the Company Board, include in the Proxy Statement the Company Board Recommendation for the approval of the Merger
and the other Transactions at the Company Shareholders Meeting and the Company shall solicit from the Company Shareholders proxies in
favor of the approval of the Merger and the other Transactions. Notwithstanding anything to the contrary contained in this Agreement,
the Company (i) shall be required to adjourn the Company Shareholders Meeting to the extent necessary to ensure that any required supplement
or amendment to the Proxy Statement is provided to the Company Shareholders and (ii) may adjourn the Company Shareholders Meeting if,
as of the time for which the Company Shareholders Meeting is scheduled, there are insufficient shares of Company Common Stock represented
(either in person or by proxy) to constitute a quorum or to obtain the Company Shareholder Approval; provided, however,
that unless otherwise agreed to by the parties, the Company Shareholders Meeting shall not be adjourned to a date that is more than 30
days after the date for which the meeting was previously scheduled; and provided, further, that the Company Shareholders Meeting
shall not be adjourned to a date on or after two Business Days prior to the End Date.
Section 6.7
Access to Information.
(a) Each
party shall, and shall cause each of its Subsidiaries to, afford to the other party and its Representatives, during the period from
the date of this Agreement to the earlier of the Effective Time and the termination of this Agreement pursuant to the terms of Section
8.1, reasonable access, during normal business hours and upon reasonable prior notice, to the officers, employees and offices of
such party and its Subsidiaries and to their books, records, contracts and documents and shall, and shall cause each of its
Subsidiaries to, furnish reasonably promptly to the other party and its Representatives such information concerning its and its
Subsidiaries’ business, properties, contracts, records and personnel, in each case as such other party may reasonably request
in connection with consummating the Transactions. Each of the Company and Parent will use its commercially reasonable efforts to
minimize any disruption to the businesses of the other party that may result from the requests for access, data and information
hereunder. Notwithstanding the foregoing provisions of this Section 6.7(a), each party shall not be required to, or to cause
any of its Subsidiaries to, grant access or furnish information to the other party or any of its Representatives to the extent that
(i) such information is subject to an attorney/client privilege, the attorney work product doctrine or other legal privilege or (ii)
such access or the furnishing of such information is prohibited by applicable Law or an existing contract or agreement or a contract
or agreement entered into after the date of this Agreement in the ordinary course of business. Each party agrees that it will not,
and will cause its Representatives not to, use any information obtained pursuant to this Section 6.7(a) for any purpose
unrelated to the consummation of the Transactions.
(b)
The Mutual Confidentiality and Non-Disclosure Agreement, dated as of October 23, 2023, between the Company and Parent (the “Non-Disclosure
Agreement”), shall survive the execution and delivery of this Agreement and shall apply to all information furnished thereunder
or hereunder. All information provided to any party or its Representatives pursuant to or in connection with this Agreement is deemed
to be “Confidential Information” as defined under the Non-Disclosure Agreement.
Section 6.8
Reasonable Best Efforts.
(a)
Subject to the terms and conditions of this Agreement, each party will use its reasonable best efforts to take, or cause to be
taken, all actions and to do, or cause to be done, all things necessary, proper or advisable under applicable Laws or pursuant to any
contract or agreement to consummate the Merger and the other Transactions as soon as practicable after the date hereof, including (i)
preparing and filing or otherwise providing, in consultation with the other party and as promptly as practicable and advisable after the
date hereof, all documentation to effect all necessary applications, notices, petitions, filings and other documents and to obtain as
promptly as practicable all waiting period expirations or terminations, consents, clearances, waivers, licenses, orders, registrations,
approvals, permits and authorizations necessary or advisable to be obtained from any third party and/or any Governmental Entity in order
to consummate the Merger or any of the other Transactions, (ii) taking all steps as may be necessary, subject to the limitations in this
Section 6.8, to obtain all such waiting period expirations or terminations, consents, clearances, waivers, licenses, registrations,
permits, authorizations, orders and approvals and (iii) executing and delivering any additional instruments reasonably necessary
or advisable to consummate the Merger and the Transactions contemplated by this Agreement and to fully carry out the purposes of this
Agreement.
(b) In
connection with and without limiting the foregoing, each of the parties shall give any required notices to third parties, and each
of the parties shall use, and cause each of their respective Subsidiaries and Affiliates to use, its reasonable best efforts to
obtain any third party consents that are necessary, proper or advisable to consummate the Merger and the other Transactions. Each of
the parties will furnish to the other such necessary information and reasonable assistance as the other may request in connection
with the preparation of any required filings or submissions with any Governmental Entity and will cooperate in responding to any
inquiry from a Governmental Entity, including promptly informing the other parties of such inquiry, consulting in advance before
making any presentations or submissions to a Governmental Entity and supplying each other with copies of all material
correspondence, filings or communications between either party and any Governmental Entity with respect to this Agreement. To the
extent reasonably practicable, the parties and their Representatives shall have the right to review in advance and each of the
parties will consult the others on, all the information relating to the other and each of their Affiliates that appears in any
filing made with, or written materials submitted to, any Governmental Entity in connection with the Merger and the other
Transactions, except that confidential competitively sensitive business information may be redacted from such exchanges. To the
extent reasonably practicable, none of the parties shall, nor shall they permit their respective Representatives to, participate
independently in any meeting or engage in any substantive conversation with any Governmental Entity in respect of any filing,
investigation or other inquiry without giving the other party prior notice of such meeting or conversation and, to the extent
permitted by applicable Law, without giving the other parties the opportunity to attend or participate (whether by telephone or in
person) in any such meeting with such Governmental Entity.
(c)
Notwithstanding anything to the contrary in this Agreement, in connection with obtaining any approval or consent from any Person
with respect to the Merger and the other Transactions, neither the Company nor any Subsidiary of the Company shall pay or commit to pay
to any Person whose approval or consent is being solicited any cash or other consideration, make any accommodation or commitment or incur
any liability or other obligation to such Person without the prior written consent of Parent. The parties shall cooperate to obtain such
consents.
(d)
Except as described in this Agreement or in Section 6.8 of the Parent Disclosure Letter, in connection with obtaining any
approval or consent from any Person with respect to the Merger and the other Transactions, neither the Parent nor any Subsidiary of Parent
shall pay or commit to pay to any Person whose approval or consent is being solicited any cash or other consideration, make any accommodation
or commitment or incur any liability or other obligation to such Person without the prior written consent of the Company.
Section 6.9
Employee Matters. Parent may extend offers of employment to those Business Employee or, employees of any Subsidiary
of Parent’s choosing (including, for the avoidance of doubt, to any, some, none or all Business Employees) prior to the Closing
Date for employment immediately following the Effective Time. Such employment or consulting agreements shall be privately negotiated between
Parent and each such employee.
Section 6.10 Parent
Equity Investment. On or prior to (a) the date of this Agreement, July 12, 2024 (the “Initial Parent Equity
Investment Date”), Parent shall purchase 500 shares of the Company’s Series F-1 Preferred Stock, par value $0.0001
per share (“F-1 Preferred Stock”) for an aggregate purchase price of $500,000 (the “Initial Parent
Equity Investment”), (b) August 9, 2024 (the “Second Parent Equity Investment Date”), Parent shall
purchase an additional 500 shares of the F-1 Preferred Stock for an additional aggregate purchase price of $500,000 (the
“Second Parent Equity Investment”), (c) the earlier of August 30, 2024 or five (5) business days of the closing
of a public offering by Parent resulting in aggregate net proceeds to Parent of no less than $20,000,000, (such earlier date the
“Third Parent Equity Investment Date”), Parent shall purchase an additional 2,000 shares of F-1 Preferred Stock
for an additional aggregate purchase price of $2,000,000 (the “Third Parent Equity Investment”) and (d) September
30, 2024, (the “Fourth Parent Equity Investment Date”), Parent shall purchase an additional 1,000 shares of the
F-1 Preferred Stock for an additional aggregate purchase price of $1,000,000 (the “Fourth Parent Equity
Investment”).The foregoing numbers of shares of F-1 Preferred Stock shall be equitably adjusted for any stock split,
reverse stock split, stock dividend (including any dividend or other distribution of securities convertible into F-1 Preferred
Stock), subdivision, reorganization, reclassification, recapitalization, combination, exchange of shares or other like change with
respect to the number of shares of F-1 Preferred Stock outstanding after the date hereof and prior to the Effective Time or any
change to the “Stated Value” thereof as set forth in that certain Amended and Restated Certificate of
Designations of Series F-1 Convertible Preferred Stock of the Company
Section 6.11
Shareholder Litigation. In the event any Transaction Litigation is commenced, the parties agree to cooperate and use
their reasonable best efforts to defend against and respond thereto. Each party shall give the other party a reasonable opportunity to
participate in the defense or settlement of any Transaction Litigation and shall consider in good faith the other party’s advice
with respect to such Transaction Litigation; provided, that neither the Company nor Parent shall agree to settle any Transaction
Litigation without the prior written consent of the other (which consent shall not be unreasonably withheld, delayed or conditioned).
Section 6.12
Public Announcements. The initial press release with respect to the execution of this Agreement shall be a joint press
release to be reasonably agreed upon by the parties. From and after the date hereof, so long as this Agreement is in effect, neither the
Company nor Parent, nor any of their respective controlled Affiliates or Subsidiaries shall issue or cause the publication of any press
release or other announcement with respect to the Merger or this Agreement without the prior consent of the other party (which consent
shall not be unreasonably withheld, conditioned or delayed), unless (a) such party determines, after consultation with outside counsel,
that it is required by applicable Law or the rules of any stock exchange upon which such party’s capital stock is traded to issue
or cause the publication of any press release or other announcement with respect to the Transactions, including the Merger or this Agreement,
in which event such party shall endeavor, on a basis reasonable under the circumstances, to provide a meaningful opportunity to the other
party to review and comment upon such press release or other announcement and shall give due consideration to all reasonable additions,
deletions or changes suggested thereto or (b) in the case of the Company or Parent, it deems it necessary or appropriate to issue or cause
the publication of any press release or other announcement with respect to the Merger, this Agreement or the other Transactions in connection
with or following a Company Change of Recommendation or a Parent Change of Recommendation, respectively; provided, however,
each party and their respective controlled Affiliates may make statements that are not inconsistent with previous press releases, public
disclosures or public statements made by Parent and the Company in compliance with this Section 6.12.
Section 6.13
Control of Business. Without limiting in any way any party’s rights or obligations under this Agreement, nothing
contained in this Agreement shall give any party, directly or indirectly, the right to control or direct the other party and their respective
Subsidiaries’ operations prior to the Effective Time. Prior to the Effective Time, each of the parties shall exercise, consistent
with the terms and conditions of this Agreement, complete control and supervision over its and its Subsidiaries’ respective operations.
Section 6.14
Transfer Taxes. All Transfer Taxes incurred in connection with the Transactions, if any, shall be paid by Parent or
the Surviving Company when due, whether levied on Parent or any other Person, and Parent or the Surviving Company shall file all necessary
Tax Returns and other documentation with respect to any such Transfer Taxes. Prior to the Closing, the parties will cooperate, in good
faith, in the filing of any Tax Returns with respect to Transfer Taxes and the minimization, to the extent reasonably permissible under
applicable Law, of the amount of any Transfer Taxes.
Section
6.15 Notification. The Company shall give prompt notice to Parent, and Parent shall give prompt
notice to the Company, (a) of any notice or other communication received by such party from any Governmental Entity in connection with
this Agreement, the Merger or the other Transactions, and each party shall keep the other party reasonably informed on a current basis
regarding any such matters, (b) of any notice or other communication received by such party from any Person (other than a Governmental
Entity) alleging that the consent of such Person is or may be required in connection with the Merger or the other Transactions, if the
subject matter of such communication or the failure of such party to obtain such consent could be material to the Company, the Surviving
Company or Parent, and each party shall keep the other party reasonably informed on a current basis regarding any such matters, (c) of
any Proceeding commenced or, to any party’s knowledge, threatened against, such party or any of its Affiliates or otherwise relating
to, involving or affecting such party or any of its Affiliates, in each case, in connection with, arising from or otherwise relating
to the Merger or any other Transaction (“Transaction Litigation”), and (d) upon
becoming aware of the occurrence or impending occurrence of any event or circumstance relating to it or any of the Subsidiaries of the
Company or any of the Subsidiaries of Parent, respectively, which would reasonably be expected to have, individually or in the aggregate,
a Company Material Adverse Effect or a Parent Material Adverse Effect, as the case may be, or which would reasonably be expected to prevent
or materially delay or impede the consummation of the Transactions; provided, however, that, in each case, the delivery
of any notice pursuant to this Section 6.15 shall not cure any breach of any representation or warranty requiring disclosure of
such matter prior to the date of this Agreement or otherwise limit or affect the remedies available hereunder to any party. The failure
to deliver any such notice shall not affect any of the conditions set forth in Article VII or give rise to any right to terminate
under Article VIII.
Section 6.16
Use of Company’s Cash Receipts. Parent shall not utilize any of the Company’s cash receipts to make payments
on Parent’s indebtedness.
Section 6.17
Takeover Laws. The parties shall use their respective reasonable best efforts (a) to take all action necessary so that
no Takeover Law is or becomes applicable to the Merger or any of the other Transactions and (b) if any such Takeover Law is or becomes
applicable to any of the foregoing, to take all action necessary so that the Merger and the other Transactions may be consummated as promptly
as practicable on the terms contemplated by this Agreement and otherwise to eliminate or minimize the effect of such Takeover Law on the
Merger and the other Transactions.
Section 6.18
[Intentionally omitted]
Section 6.19
Delisting. Each of the parties agrees to cooperate with the other parties in taking, or causing to be taken, all actions
necessary to delist the Company Common Stock and terminate its registration under the Exchange Act; provided that such delisting
and termination shall not be effective until after the Effective Time.
Section 6.20
Obligations of Merger Sub and the Surviving Company. Parent shall take all action necessary to cause Merger Sub and
the Surviving Company to perform their respective obligations under this Agreement and to consummate the Merger and the other Transactions
upon the terms and subject to the conditions set forth in this Agreement.
Section 6.21 Surviving
Company Option Plan. Immediately
subsequent to the Closing, the Surviving Company shall establish an option plan on the terms and conditions with the grants set forth
in Section 6.21 of the Parent Disclosure Letter and shall grant an aggregate of at least 10% of the equity of the Company on a
fully-diluted, post-Closing basis to the management group of the Company on a mutually agreed basis.
Section 6.22
Benefits. Each Business Employee who becomes employed by Parent (or a Subsidiary of Parent) in connection with the transactions
contemplated by this Agreement shall be given eligibility to receive, as of the Closing Date, the benefits maintained for employees of
Parent’s Subsidiaries’ on substantially similar terms and conditions in the aggregate as are provided to such similarly situated
employees. Each Business Employee who becomes employed by Parent or a Parent Subsidiary (including the Company) in connection with the
transaction shall be given credit for his or her period of service with Company prior to the Closing Date for the purpose of eligibility
under the benefit plans maintained by Parent or such Parent Subsidiary and made available for such employee after the Closing Date, provided
that nothing herein will require the crediting of service that would operate to duplicate any benefits or to require funding of any such
benefits.
Section 6.23
Exchange Agreements. Prior to Closing, the Company shall assist the Parent in obtaining the agreement (the “Exchange
Agreements”) of the Company Convertible Noteholders to exchange such Company Convertible Notes and purchase rights they hold
for an aggregate (for all Company Convertible Note Holders) of not more than 88,161 shares of Parent Preferred Stock on terms acceptable
to Parent in its reasonable discretion.
Article
VII
CONDITIONS PRECEDENT
Section 7.1
Conditions to Each Party’s Obligation to Consummate the Merger. The respective obligation of each party to consummate
the Merger is subject to the satisfaction at or prior to the Effective Time of each of the following conditions, any or all of which may
be waived jointly by the parties, in whole or in part, to the extent permitted by applicable Law:
(a)
Shareholder Approvals. The Company Shareholder Approval shall have been obtained in accordance with applicable Law and the
Organizational Documents of the Company.
(b)
No Injunctions or Restraints. No Governmental Entity having jurisdiction over any party shall have issued any order, decree,
ruling, injunction or other action that is in effect (whether temporary, preliminary or permanent) restraining, enjoining or otherwise
prohibiting the consummation of the Merger and no Law shall have been adopted that makes consummation of the Merger illegal or otherwise
prohibited.
(c)
[Intentionally omitted]
(d)
Voting Agreement. The Voting Agreement shall have been executed and delivered by the parties thereto.
(e)
Company Preferred Stock. All Company Preferred Stock shall have been converted to Company Common Stock except for the Unconverted
Company Preferred Stock and the Company shall have received an affirmation from each holder of Unconverted Company Preferred Stock that
such holder is an “Accredited Investor” (as such term is defined in Regulation D as promulgated under the Securities
Act) in a form acceptable to Parent.
(f)
Company Warrant Holder Agreements. The Company shall have received agreements from all of the holders of the Company’s
warrants (other than the Company Warrants set forth in Section 7.1(f) of the Company Disclosure Letter (the “Other Company
Warrants”)) (all holders of Company Warrants, collectively, the “Warrant Holders”) duly executed agreements
(“Warrant Holder Agreements”) containing (i) waivers with respect to any fundamental transaction, change in control
or other similar rights that such Warrant Holders may have under any such Company Warrants, including, but not limited to, any right to
vote, consent, demand cash payment for their warrants, or otherwise approve or veto any of the transactions contemplated by this Agreement,
including the Merger, the Parent Stock Issuance or any option to cause the Company or the Parent to purchase any such Company Warrants
from any Warrant Holders (or pay any other cash consideration to any Warrant Holders) and (ii) to exchange such Company Warrants as they
hold for an aggregate (for all Warrant Holders) of not more than 930.336 shares of Parent Preferred Stock on terms acceptable to Parent
in its reasonable discretion.
(g)
Other Company Warrants. The Company shall have cashed out any Other Warrant Holder who has not provided a Warrant Holder
Agreement; provided, however, that the aggregate amount of such cash out for any and all Other Warrant Holders who have
not provided a Warrant Holder Agreement shall not exceed $150,000.
(h)
Company Convertible Note Holders; Waivers. The Company shall have obtained waivers from holders of Company Convertible Notes
(such holders, collectively, the “Company Convertible Debt Holders” and such waivers, the “Company Convertible
Note Holder Waivers”) of the original principal amount thereof with respect to any fundamental transaction rights such Company
Convertible Note Holders may have under any such Company Convertible Notes, including any right to vote, consent, or otherwise approve
or veto any of the transactions contemplated by this Agreement, including the Merger, the Parent Stock Issuance or any option to cause
Company or the Parent to redeem any such Company Convertible Notes from any Company Convertible Note Holders (or pay any other cash consideration
to any Company Convertible Note Holders).
(i)
Financing. Parent shall have received sufficient financing to satisfy its payment obligations under this Agreement.
(j)
Parent Special Meeting. The requisite stockholder approval shall have been obtained by Parent at a Special Meeting of its
Stockholders to approve the Parent Stock Issuance pursuant to the requirements of NASDAQ.
Section 7.2 Additional
Conditions to Obligations of Parent and Merger Sub. The obligations of Parent and Merger Sub to consummate the Merger are
subject to the satisfaction at or prior to the Effective Time of each of the following conditions, any or all of which may be waived
exclusively by Parent or Merger Sub, as applicable, in whole or in part, to the extent permitted by applicable Law:
(a)
Representations and Warranties of the Company. (i) The representations and warranties of the Company set forth in Section
4.3(a) (Authority), Section 4.6(a) (Company Material Adverse Effect) and Section 4.19 (Brokers) shall be true and correct
in all respects as of the Closing Date, as though made on and as of the Closing Date (except that representations and warranties that
speak as of a specified date shall have been true and correct in all material respects only as of such date), (ii) the representations
and warranties of the Company set forth in Section 4.2(a) (Capital Structure) shall be true and correct in all but de minimis respects
as of the specified dates set forth therein, and (iii) all other representations and warranties of the Company set forth in Article
IV shall be true and correct as of the Closing Date, as though made on and as of the Closing Date (except that representations and
warranties that speak as of a specified date shall have been true and correct only as of such date), except where the failure of such
representations and warranties to be so true and correct (without regard to qualification or exceptions contained therein as to “materiality”
or “Company Material Adverse Effect”) would not reasonably be expected to have, individually or in the aggregate, a
Company Material Adverse Effect.
(b)
Performance of Obligations of the Company. The Company shall have performed, or complied with, in all material respects
all agreements and covenants required to be performed or complied with by it under this Agreement on or prior to the Effective Time.
(c)
Compliance Certificate. Parent shall have received a certificate of the Company signed by an executive officer of the Company,
dated the Closing Date, confirming that the conditions in Section 7.2(a) and Section 7.2(b) have been satisfied.
(d)
Exchange Agreements. The Company Convertible Note Holders shall have executed and delivered to Parent the Exchange Agreements.
(e)
Absence of Company Material Adverse Effect. Since the date of this Agreement, there shall not have been any event, change,
effect or development that, individually or in the aggregate, has had or would reasonably be expected to have a Company Material Adverse
Effect.
(f)
VAR Waiver. Parent shall have received waivers from the parties to the agreements listed in Section 7.2(f) to the
Parent Disclosure Letter of the issuance of securities in a “Variable Rate Transaction” (as such term in defined in
such agreements).
(g)
FIRPTA Statement. The Company shall have delivered to Parent a certificate, dated as of the Closing Date, certifying to
the effect that no interest in the Company is a U.S. real property interest (such certificate in the form required by Treasury Regulation
Section 1.897-2(h) and 1.1445-3(c)).
(h)
Tax Analysis. The parties shall work together between the execution of this Agreement and the Effective Time to determine
the Tax treatment of the Merger and the other Transactions contemplated by this Agreement. Parties shall report consistently with the
agreed Tax treatment and shall not take any contrary position in any Tax return, examination, audit or any other proceeding.
(i)
Repurchase Price. No defaults shall have occurred and be continuing under the Loan Documents and the Outstanding Balance
(as defined in the Securities Purchase Agreement) plus all accrued and unpaid interest thereon, in an amount not to exceed the Repurchase
Price (as defined in the Securities Purchase Agreement) shall have been paid in full.
(j)
Dissenting Shares. There shall be no more than 4,141,434 Dissenting Shares that are Company Common Stock or 98 Dissenting
Shares that are Company Preferred Stock.
Section 7.3
Additional Conditions to Obligations of the Company. The obligation of the Company to consummate the Merger is subject
to the satisfaction at or prior to the Effective Time of each of the following conditions, any or all of which may be waived exclusively
by the Company, in whole or in part, to the extent permitted by applicable Law:
(a)
Representations and Warranties of Parent and Merger Sub. (i) The representations and warranties of Parent and Merger Sub
set forth in Section 5.3(a) (Authority), Section 5.6(a) (Parent Material Adverse Effect) and Section 5.18 (Brokers)
shall be true and correct in all material respects as of the Closing Date, as though made on and as of the Closing Date (except that representations
and warranties that speak as of a specified date shall have been true and correct in all material respects only as of such date), (ii)
the representations and warranties of Parent and Merger Sub set forth in Section 5.2(a) (Capital Structure) shall be true and correct
in all but de minimis respects as of the specified dates set forth therein, and (iii) all other representations and warranties of Parent
and Merger Sub set forth in Article V shall be true and correct as of the Closing Date, as though made on and as of the Closing
Date (except that representations and warranties that speak as of specified date shall have been true and correct only as of such date),
except where the failure of such representations and warranties to be so true and correct (without regard to qualification or exceptions
contained therein as to “materiality” or “Parent Material Adverse Effect”) would not reasonably
be expected to have, individually or in the aggregate, a Parent Material Adverse Effect.
(b)
Performance of Obligations of Parent and Merger Sub. Parent and Merger Sub each shall have performed, or complied with,
in all material respects all agreements and covenants required to be performed or complied with by them under this Agreement at or prior
to the Effective Time.
(c)
Compliance Certificate. The Company shall have received a certificate of Parent signed by an executive officer of Parent,
dated the Closing Date, confirming that the conditions in Section 7.3(a), Section 7.3(b), Section 7.3(d), and Section
7.3(e) have been satisfied.
(d)
Absence of Parent Material Adverse Effect. Since the date of this Agreement, there shall not have been any event, change,
effect or development that, individually or in the aggregate, has had or would reasonably be expected to have a Parent Material Adverse
Effect.
(e)
NASDAQ. The Parent shall be in compliance with the stockholders’ equity requirement in NASDAQ Listing Rule 5550(b)(1)
and meets all other applicable criteria for continued listing, subject to any panel monitor imposed by NASDAQ.
Section 7.4 Frustration
of Closing Conditions. None
of the parties may rely, either as a basis for not consummating the Merger or for terminating this Agreement, on the failure of any condition
set forth in Section 7.1, Section 7.2 or Section 7.3, as the case may be, to be satisfied if such party’s
breach of any provision of this Agreement contributed materially to such failure.
Article
VIII
TERMINATION
Section 8.1
Termination. This Agreement may be terminated, and the Merger and the other Transactions contemplated hereby may be
abandoned, at any time prior to the Effective Time, whether (except as expressly set forth below) before or after the Company Shareholder
Approval has been obtained:
(a)
by mutual written consent of the Company and Parent;
(b)
by either the Company or Parent:
(i) if any Governmental Entity of competent jurisdiction shall have issued a final and nonappealable order, decree, ruling or injunction
or taken any other action permanently restraining, enjoining or otherwise prohibiting the consummation of the Merger, or if there shall
have been adopted prior to the Effective Time any Law that permanently makes the consummation of the Merger illegal or otherwise permanently
prohibited;
(ii) if the Merger shall not have been consummated on or before 5:00 p.m. Eastern Time, on September 30, 2024 (such date being the “End
Date”); provided, that the right to terminate this Agreement under this Section 8.1(b)(ii) shall not be available
to any party whose breach of any representation, warranty, covenant or agreement contained in this Agreement has been the primary cause
of or resulted in the failure of the Merger to occur on or before such date;
(iii)
in the event of a breach by the other party (treating Parent and Merger Sub as one party) of any covenant or other agreement contained
in this Agreement or if any representation and warranty of the other party contained in this Agreement fails to be true and correct which
(x) would give rise to the failure of a condition set forth in Section 7.2(a) or (b) or Section 7.3(a) or (b),
as applicable, if it were continuing as of the Closing Date and (y) cannot be or has not been cured (or is incapable of becoming true
or does not become true) by the earlier of (1) the End Date and (2) the date that is 30 days after the giving of written notice to the
breaching party of such breach or failure to be true and correct and the basis for such notice (a “Terminable Breach”);
provided, however, that the terminating party is not then in Terminable Breach of any representation, warranty, covenant
or other agreement contained in this Agreement; or
(iv)
if the Company Shareholder Approval shall not have been obtained at a duly held Company Shareholders Meeting (including any adjournment
or postponement thereof) at which a vote on the approval of this Agreement and the Transactions, including the Merger, was taken; or
(c)
by Parent prior to the time the Company Shareholder Approval is obtained, if the Company Board shall have effected a Company Change
of Recommendation;
(d)
by the Company at any time after there has been a Company Change of Recommendation; provided, that the Company has provided
the Parent ten (10) calendar days’ prior written notice thereof and has negotiated in good faith with Parent to provide a competing
offer;
(e)
by the Company if the Parent Common Stock is no longer listed for trading on NASDAQ;
(f)
by the Company if any of: (i) the Initial Parent Equity Investment has not been made by the Initial Parent Equity Investment Date,
(ii) the Second Parent Equity Investment has not been made by the Second Parent Equity Investment Date, (iii) the Third Parent Equity
Investment has not been made by the Third Parent Equity Investment Date or (iv) the Fourth Parent Equity Investment has not been made
by the Fourth Parent Equity Investment Date; and
(g)
by the Parent in the event that the Parent determines, in its reasonable discretion, that the acquisition of the Company pursuant
to this Agreement could result in a materially adverse amount of cancellation of indebtedness income to Parent for federal income-tax
purposes recognized and attributable to any modification, restructuring, or purchase of the indebtedness of the Company or the purchase
of the Company. Determining whether any income is “materially adverse” shall take into account both (i) whether such
income is offset by any available current operating losses and net operating loss and other tax attributes carryforwards, and (ii) the
materiality of the amount of tax attributable to such income, net of all offsets, deductions, credits and other reductions in the amount
of tax actually payable as a result thereof.
Section 8.2
Notice of Termination; Effect of Termination.
(a)
A terminating party shall provide written notice of termination to the other party specifying with particularity the reason for
such termination, and, except as otherwise provided in Section 8.1(d), any termination shall be effective immediately upon delivery
of such written notice to the other party.
(b)
In the event of termination of this Agreement by any party as provided in Section 8.1, this Agreement shall forthwith become
void and there shall be no liability or obligation on the part of any party except with respect to this Section 8.2, Section
6.7(b), Section 8.3 and Articles I and IX, which Sections and Articles shall not terminate; provided,
however, that notwithstanding anything to the contrary herein, no such termination shall relieve any party from liability for any
damages arising from or arising out of an intentional and material breach of any covenant, agreement or obligation hereunder or intentional
fraud, or as provided in the Non-Disclosure Agreement, in which case the aggrieved party shall be entitled to all rights and remedies
available at law or in equity.
Section 8.3
Expenses and Other Payments. Except as otherwise provided separately between the parties, each party shall pay its own
expenses incident to preparing for, entering into and carrying out this Agreement and the consummation of the Transactions, whether or
not the Merger shall be consummated.
Article
IX
GENERAL PROVISIONS
Section 9.1
Disclosure Letter Definitions. All capitalized terms in the Company Disclosure Letter and the Parent Disclosure Letter
shall have the meanings ascribed to them herein (including in Annex A) except as otherwise defined therein.
Section 9.2
Survival. Except as otherwise provided in this Agreement, none of the representations, warranties, agreements and covenants
in this Agreement or in any instrument delivered pursuant to this Agreement, including any rights arising out of any breach of such representations,
warranties, agreements and covenants, shall survive the Effective Time, except for those covenants and agreements contained herein and
therein that by their terms apply or are to be performed in whole or in part after the Effective Time. The Non-Disclosure Agreement shall
(a) survive termination of this Agreement in accordance with its terms and (b) terminate as of the Effective Time.
Section 9.3
Notices. All notices, requests and other communications to any party under, or otherwise in connection with, this Agreement
shall be in writing and shall be deemed to have been duly given upon the earlier of actual receipt or: (a) when delivered by hand providing
proof of delivery; (b) when received by the addressee if sent by a nationally recognized overnight courier (receipt requested); or (c)
on the date sent by email if sent during normal business hours of the recipient, and on the next Business Day if sent after normal business
hours of the recipient. Such communications must be sent to the respective parties at the following addresses (or to such other Persons
or at such other address for a party as shall be specified in a notice given in accordance with this Section 9.3):
(i)
if to Parent or Merger Sub, to:
Aditxt, Inc.
737 Fifth Street, Suite 200
Richmond, VA 23219
Attention: Amro Albanna, CEO
E-mail: aalbanna@aditxt.com
with a required copy to (which copy shall not
constitute notice):
Sheppard, Mullin, Richter & Hampton LLP
30 Rockefeller Plaza
New York, NY 10112
Attn: Richard Friedman, Esq.
Email: rafriedman@sheppardmullin.com
(ii)
if to the Company, to:
Evofem Biosciences, Inc.
7770 Regents Road, Suite 113-618
San Diego, CA 92122
Attn: Sandra Pelletier, CEO
E-Mail: spelletier@evofem.com
with a required copy to (which copy shall not
constitute notice):
Procopio, Cory, Hargreaves & Savitch LLP
12544 High Bluff Drive, Suite 400
San Diego, CA 92130
Attn: Jennifer Trowbridge and Paul Johnson
E-Mail: jennifer.trowbridge@procopio.com; paul.johnson@procopio.com
Section 9.4
Rules of Construction.
(a)
Each of the parties acknowledges that it has been represented by counsel of its choice throughout all negotiations that have preceded
the execution of this Agreement and that it has executed the same with the advice of independent counsel. Each party and its counsel cooperated
in the drafting and preparation of this Agreement and the documents referred to herein, and any and all drafts relating thereto exchanged
between the parties shall be deemed the work product of the parties and may not be construed against any party by reason of its preparation.
Accordingly, any rule of law or any legal decision that would require interpretation of any ambiguities in this Agreement against any
party that drafted it is of no application and is hereby expressly waived.
(b)
The inclusion of any information in the Company Disclosure Letter or Parent Disclosure Letter shall not be deemed an admission
or acknowledgment, in and of itself and solely by virtue of the inclusion of such information in the Company Disclosure Letter or Parent
Disclosure Letter, as applicable, that such information is required to be listed in the Company Disclosure Letter or Parent Disclosure
Letter, as applicable, that such items are material to the Company and its Subsidiaries, taken as a whole, or Parent and its Subsidiaries,
taken as a whole, as the case may be, or that such items have resulted in a Company Material Adverse Effect or a Parent Material Adverse
Effect. The headings, if any, of the individual sections of each of the Parent Disclosure Letter and Company Disclosure Letter are inserted
for convenience only and shall not be deemed to constitute a part thereof or a part of this Agreement. The Company Disclosure Letter and
Parent Disclosure Letter are arranged in sections corresponding to the Sections of this Agreement merely for convenience, and the disclosure
of an item in one section of the Company Disclosure Letter or Parent Disclosure Letter, as applicable, as an exception to a particular
representation or warranty shall be deemed adequately disclosed as an exception with respect to all other representations or warranties
to the extent that the relevance of such item to such representations or warranties is reasonably apparent from such item, notwithstanding
the presence or absence of an appropriate Section of the Company Disclosure Letter or Parent Disclosure Letter with respect to such other
representations or warranties or an appropriate cross reference thereto.
(c) The
specification of any dollar amount in the representations and warranties or otherwise in this Agreement or in the Company Disclosure
Letter or Parent Disclosure Letter is not intended and shall not be deemed to be an admission or acknowledgment of the materiality
of such amounts or items, nor shall the same be used in any dispute or controversy between the parties to determine whether any
obligation, item or matter (whether or not described herein or included in any schedule) is or is not material for purposes of this
Agreement.
(d)
All references in this Agreement to Annexes, Exhibits, Schedules, Articles, Sections, subsections and other subdivisions refer
to the corresponding Annexes, Exhibits, Schedules, Articles, Sections, subsections and other subdivisions of this Agreement unless expressly
provided otherwise. Titles appearing at the beginning of any Articles, Sections, subsections or other subdivisions of this Agreement are
for convenience only, do not constitute any part of such Articles, Sections, subsections or other subdivisions, and shall be disregarded
in construing the language contained therein. The words “this Agreement,” “herein,” “hereby,”
“hereunder” and “hereof” and words of similar import, refer to this Agreement as a whole and not
to any particular subdivision unless expressly so limited. The words “this Section,” “this subsection”
and words of similar import, refer only to the Sections or subsections hereof in which such words occur. The word “including”
(in its various forms) means “including, without limitation.” Pronouns in masculine, feminine or neuter genders shall
be construed to state and include any other gender and words, terms and titles (including terms defined herein) in the singular form shall
be construed to include the plural and vice versa, unless the context otherwise expressly requires. Unless the context otherwise requires,
all defined terms contained herein shall include the singular and plural and the conjunctive and disjunctive forms of such defined terms.
Unless the context otherwise requires, all references to a specific time shall refer to New York, New York time.
(e)
In this Agreement, except as the context may otherwise require, references to: (i) any agreement (including this Agreement), contract,
statute or regulation are to the agreement, contract, statute or regulation as amended, modified, supplemented, restated or replaced from
time to time (in the case of an agreement or contract, to the extent permitted by the terms thereof and, if applicable, by the terms of
this Agreement); (ii) any Governmental Entity include any successor to that Governmental Entity; (iii) any applicable Law refers to such
applicable Law as amended, modified, supplemented or replaced from time to time (and, in the case of statutes, include any rules and regulations
promulgated under such statute) and references to any section of any applicable Law or other law include any successor to such section;
and (iv) “days” mean calendar days. If any period expires on a day which is not a Business Day or any event or
condition is required by the terms of this Agreement to occur or be fulfilled on a day which is not a Business Day, such period shall
expire or such event or condition shall occur or be fulfilled, as the case may be, on the next succeeding Business Day.
Section 9.5
Counterparts. This Agreement may be executed in two or more counterparts, including via facsimile or email in “portable
document format” (“pdf”) form transmission, all of which shall be considered one and the same agreement and
shall become effective when two or more counterparts have been signed by each of the parties and delivered to the other parties, it being
understood that all parties need not sign the same counterpart. The exchange of a fully executed Agreement (in counterparts or otherwise)
by electronic transmission in pdf format or by facsimile shall be sufficient to bind the parties to the terms and conditions of this Agreement.
Section 9.6
Entire Agreement; Third Party Beneficiaries.
(a)
Upon the effectiveness of this Agreement, the Original Agreement shall be deemed amended and restated and superseded and replaced
in its entirety by this Agreement, and shall be of no further force or effect.
(b)
This Agreement (together with the Non-Disclosure Agreement, the other Transaction Agreements and any other documents and instruments
executed pursuant hereto) constitutes the entire agreement and supersedes all prior agreements and understandings, both written and oral,
among the parties with respect to the subject matter hereof.
(c)
Except for the provisions of Article III (which, from and after the Effective Time, shall be for the benefit of the former
holders of Company Common Stock and Unconverted Company Preferred Stock to receive the Merger Consideration and with respect to which,
prior to the Effective Time, the Company shall have the right, on behalf of such holders, to pursue damages against Parent and Merger
Sub for the loss of the Merger Consideration in the event of any intentional and material breach of any covenant, agreement or obligation
hereunder or intentional fraud by Parent or Merger Sub) and Section 6.4 and Section 6.21 (which from and after the Effective
Time are intended for the benefit of, and shall be enforceable by, the Persons referred to therein and by their respective heirs and representatives),
nothing in this Agreement, express or implied, is intended to or shall confer upon any Person other than the parties any right, benefit
or remedy of any nature whatsoever under or by reason of this Agreement.
Section 9.7
Governing Law; Venue; Waiver of Jury Trial.
(a)
THIS AGREEMENT, AND ALL CLAIMS OR CAUSES OF ACTION (WHETHER IN CONTRACT OR TORT) THAT MAY BE BASED UPON, ARISE OUT OF OR RELATE
TO THIS AGREEMENT, OR THE NEGOTIATION, EXECUTION OR PERFORMANCE OF THIS AGREEMENT, SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH
THE LAWS OF THE STATE OF DELAWARE, WITHOUT GIVING EFFECT TO THE PRINCIPLES OF CONFLICTS OF LAW THEREOF.
(A) EACH OF THE PARTIES HERETO
HEREBY IRREVOCABLY SUBMITS TO THE EXCLUSIVE JURISDICTION OF THE COURTS OF THE STATE OF DELAWARE AND TO THE JURISDICTION OF THE UNITED
STATES DISTRICT COURT FOR THE DISTRICT OF DELAWARE, FOR THE PURPOSE OF ANY ACTION, PROCEEDING OR COUNTERCLAIM (WHETHER BASED ON CONTRACT,
TORT OR OTHERWISE) DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE ACTIONS OF THE PARTIES HERETO IN THE NEGOTIATION,
ADMINISTRATION, PERFORMANCE AND ENFORCEMENT THEREOF, AND EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY AGREES THAT ALL CLAIMS IN RESPECT
TO SUCH ACTION OR PROCEEDING MAY BE HEARD AND DETERMINED EXCLUSIVELY IN ANY STATE OR FEDERAL COURT LOCATED IN THE STATE OF DELAWARE. EACH
OF THE PARTIES HERETO FURTHER CONSENTS TO THE ASSIGNMENT TO THE BUSINESS AND TECHNOLOGY CASE MANAGEMENT PROGRAM WITH REGARD TO ANY PROCEEDING
IN THE COURTS OF THE STATE OF DELAWARE.
(b)
EACH PARTY ACKNOWLEDGES AND AGREES THAT ANY CONTROVERSY WHICH MAY ARISE UNDER THIS AGREEMENT IS LIKELY TO INVOLVE COMPLICATED
AND DIFFICULT ISSUES, AND THEREFORE EACH SUCH PARTY HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVES ANY RIGHT SUCH PARTY MAY HAVE TO A TRIAL
BY JURY IN RESPECT OF ANY PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS. EACH PARTY
CERTIFIES AND ACKNOWLEDGES THAT: (I) NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE,
THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER; (II) SUCH PARTY UNDERSTANDS AND HAS
CONSIDERED THE IMPLICATIONS OF THE FOREGOING WAIVER; (III) SUCH PARTY MAKES THE FOREGOING WAIVER VOLUNTARILY; AND (IV) SUCH PARTY HAS
BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVER AND CERTIFICATIONS IN THIS SECTION 9.7.
Section 9.8
Severability. If any term or other provision of this Agreement is invalid, illegal or incapable of being enforced by
rule of Law or public policy, all other conditions and provisions of this Agreement shall nevertheless remain in full force and effect
so long as the economic or legal substance of the Merger is not affected in any manner adverse to any party. Upon such determination that
any term or other provision is invalid, illegal or incapable of being enforced, the parties shall negotiate in good faith to modify this
Agreement so as to effect the original intent of the parties as closely as possible in an acceptable manner to the end that the Merger
is fulfilled to the extent possible.
Section 9.9
Assignment. Neither this Agreement nor any of the rights, interests or obligations hereunder shall be assigned by any
of the parties (whether by operation of law or otherwise) without the prior written consent of the other party. Subject to the preceding
sentence, this Agreement will be binding upon, inure to the benefit of and be enforceable by the parties and their respective successors
and permitted assigns. Any purported assignment in violation of this Section 9.9 shall be void.
Section 9.10
Affiliate Liability.
(a)
Each of the following is herein referred to as a “Company Affiliate”: (i) any direct or indirect holder
of equity interests or securities in the Company (whether limited or general partners, members, shareholders or otherwise); and (ii) any
director, officer, employee or other Representative of (A) the Company or (B) any Person who controls the Company. To the fullest extent
permitted by applicable Law, no Company Affiliate shall have any liability or obligation to Parent or Merger Sub of any nature whatsoever
in connection with or under this Agreement or the Transactions, and Parent and Merger Sub hereby waive and release all claims of any such
liability and obligation.
(b) Each
of the following is herein referred to as a “Parent Affiliate”: (i) any direct or indirect holder of equity
interests or securities in Parent or Merger Sub (whether limited or general partners, members, shareholders or otherwise) and (ii)
any director, officer, employee or other Representative of (A) Parent or Merger Sub or (B) any Person who controls Parent or Merger
Sub. To the fullest extent permitted by applicable Law, no Parent Affiliate shall have any liability or obligation to the Company of
any nature whatsoever in connection with or under this Agreement or the Transactions, and the Company hereby waives and releases all
claims of any such liability and obligation.
Section 9.11
Remedies; Specific Performance.
(a)
Except as otherwise provided herein, any and all remedies herein expressly conferred upon a party will be deemed cumulative with
and not exclusive of any other remedy conferred hereby, or by Law or equity upon such party and the exercise by a party of any one remedy
will not preclude the exercise of any other remedy.
(b)
The parties agree that irreparable damage, for which monetary damages would not be an adequate remedy, would occur in the event
that any of the provisions of this Agreement were not performed in accordance with their specific terms or were otherwise breached by
the parties. The parties acknowledge and agree that the parties shall be entitled to an injunction or injunctions, or any other appropriate
form of specific performance or equitable relief, to prevent breaches of this Agreement and to enforce specifically the terms and provisions
hereof in any court of competent jurisdiction, in each case in accordance with this Section 9.11, this being in addition to any
other remedy to which they are entitled under the terms of this Agreement at law or in equity.
(c)
The parties’ rights in this Section 9.11 are an integral part of the Transactions and each party accordingly agrees
not to raise any objections to the availability of the equitable remedy of specific performance to prevent or restrain breaches or threatened
breaches of, or to enforce compliance with, the covenants and obligations of such party under this Agreement all in accordance with the
terms of this Section 9.11. Each party further agrees that no other party or any other Person shall be required to obtain, furnish
or post any bond or similar instrument in connection with or as a condition to obtaining any remedy referred to in this Section 9.11,
and each party irrevocably waives (i) any defense in an action for specific performance that a remedy at law would be adequate to prevent
or restrain breaches or threatened breaches and (ii) any right it may have to require the obtaining, furnishing or posting of any such
bond or similar instrument. If prior to the End Date, any party hereto brings an action to enforce specifically the performance of the
terms and provisions hereof by any other party, the End Date shall automatically be extended by such other time period established by
the court presiding over such action.
Section 9.12
Amendment. Prior to the Effective Time, this Agreement may be amended by the mutual agreement of the parties, by action
taken or authorized by their respective Boards of Directors at any time, whether before or after the Company Shareholder Approval has
been obtained; provided, however, that after the Company Shareholder Approval has been obtained, no amendment shall be made
that pursuant to applicable Law would require the further approval or adoption by the shareholders of the Company without first obtaining
such further approval or adoption. This Agreement may not be amended except by an instrument in writing signed on behalf of each of the
parties.
Section 9.13
Extension; Waiver. At
any time prior to the Effective Time, either the Company, on the one hand, or Parent and Merger Sub, on the other hand, may, to the extent
legally allowed and except as otherwise set forth herein: (a) extend the time for the performance of any of the obligations or acts of
the other party hereunder; (b) waive any inaccuracies in the representations and warranties of the other party contained herein or in
any document delivered pursuant hereto; and (c) waive compliance with any of the agreements or conditions of the other party contained
herein. Notwithstanding the foregoing, no failure or delay by the Company, on the one hand, or Parent and Merger Sub, on the other hand,
in exercising any right hereunder shall operate as a waiver thereof nor shall any single or partial exercise thereof preclude any other
or further exercise of any other right hereunder. No agreement on the part of a party to any such extension or waiver shall be valid
unless set forth in an instrument in writing signed on behalf of such party.
[Signature Pages Follow]
IN WITNESS WHEREOF,
each party hereto has caused this Agreement to be signed by its respective officer thereunto duly authorized, all as of the date first
written above.
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ADITXT, INC. |
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By: |
/s/ Amro Albanna |
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Name: |
Amro Albanna |
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Title: |
Chief Executive Officer |
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ADIFEM, INC. |
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By: |
/s/ Amro Albanna |
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Name: |
Amro Albanna |
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Title: |
Chief Executive Officer |
Signature Page to Amended and Restated Agreement
and Plan of Merger
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EVOFEM BIOSCIENCES, INC. |
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By: |
/s/ Saundra Pelletier |
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Name: |
Saundra Pelletier |
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Title: |
Chief Executive Officer |
Signature Page to Amended and Restated Agreement
and Plan of Merger
ANNEX A
Certain Definitions
“Affiliate”
means, with respect to any Person, any other Person directly or indirectly, controlling, controlled by, or under common control with,
such Person, through one or more intermediaries or otherwise.
“Business Day”
means a day that is not a Saturday or Sunday or other day on which banks in the State of New York or the State of Delaware are authorized
or obligated to be closed.
“CARES Act”
means the Coronavirus Aid, Relief, and Economic Security Act (Pub. L. 116–136) and any administrative or other guidance published
with respect thereto by any Governmental Authority (including IRS Notices 2020-22 and 2020-65).
“Company Associate”
means any current or former employee, independent contractor, officer or director of the Company or any of its Subsidiaries.
“Company Capital
Stock” means the Company Common Stock and the Company Preferred Stock.
“Company Change of
Recommendation” means that the Company Board shall have determined to withhold, withdraw, modify or qualify, or propose publicly
to withhold, withdraw, modify or qualify the Company Board Recommendation due to the Company Board’s acceptance of a binding proposal
that, in the exercise of its fiduciary duty, it has determined to be a superior proposal to that contained in this Agreement.
“Company Convertible
Notes” means those items set forth in Section 10.1 of the Company Disclosure Letter.
“Company Intellectual
Property” means the Intellectual Property used in the operation of the business of each of the Company and its Subsidiaries
as presently conducted.
“Company Notes”
means, collectively, (a) the Company Convertible Notes and (b) the Company Unsecured Notes.
“Company Optionholder”
means a holder of Company Options.
“Company Options”
means any option or other award granted under the Company Option Plans.
“Company Option Plans”
means the Company’s Amended and Restated 2012 Equity Incentive Plan, 2014 Equity Incentive Plan and 2018 Inducement Equity Incentive
Plan.
“Company Preferred
Stock” means the Company’s Series E-1 Convertible Preferred Stock and the F-1 Preferred Stock.
“Company Shareholder
Approval” means the approval of the Agreement and the Transactions, including the Merger, at the Company Shareholders Meeting
in accordance with the DGCL and the Organizational Documents of the Company by the affirmative vote of at least a majority of (i) the
outstanding shares of Company Common Stock (including all Company Preferred Stock on the basis and to the extent it is permitted to so
vote) entitled to vote thereon and (ii) the Unconverted Company Preferred Stock.
“Company Shareholders”
means the holders of Company Common Stock and the Company Preferred Stock.
“Company Warrants”
means all warrants representing the right to purchase shares of Company Common Stock.
“Consent”
means any approval, consent, ratification, clearance, permission, waiver, or authorization.
“control”
and its correlative terms, means the possession, directly or indirectly, of the power to direct or cause the direction of the management
and policies of a Person, whether through the ownership of voting securities, by contract or otherwise.
“COVID-19”
means SARS-CoV-2 or COVID-19 (and all related strains and sequences), including any intensification, resurgence or any evolutions or mutations
thereof, and/or related or associated epidemics, pandemics, disease outbreaks or public health emergencies.
“COVID-19 Measures”
means (i) a Person’s and its Subsidiaries’ compliance with any quarantine, “shelter in place,” “stay
at home,” social distancing, shut down, closure, sequester, safety or similar Law, guidelines or recommendations promulgated
by any Governmental Entity, including the Centers for Disease Control and Prevention or the World Health Organization, in each case, in
connection with, related to, or in response to COVID-19, including the Coronavirus Aid, Relief, and Economic Security Act (Public Law
116-136), signed into law on March 27, 2020, and Families First Coronavirus Response Act, or any other response to COVID-19 (including
any such response undertaken by any similarly situated industry participants), and (ii) the reversal or discontinuation of any of the
foregoing.
“EDGAR”
means the Electronic Data Gathering, Analysis and Retrieval System administered by the SEC.
“EMEA”
means the European Medicines Agency.
“Employee
Benefit Plan” of any Person means any “employee benefit plan” (within the meaning of Section 3(3) of
ERISA, regardless of whether such plan is subject to ERISA), and any equity option, restricted equity, equity purchase plan, equity
or equity-based compensation plan, phantom equity or appreciation rights plan, collective bargaining agreement, bonus plan or
arrangement, incentive award plan or arrangement, vacation or holiday pay policy, retention or severance pay plan, policy or
agreement, deferred compensation agreement or arrangement, change in control, hospitalization or other medical, dental, vision,
accident, disability, life or other insurance, executive compensation or supplemental income arrangement, consulting agreement,
employment agreement and any other material employee benefit plan, agreement, arrangement, program, practice or understanding, in
each case, whether written or unwritten, that is sponsored, maintained, administered, contributed to or entered into by such Person
for the current or future benefit of any present or former director, employee or contractor of the Person or with respect to which
such Person has any direct or indirect liability, whether current or contingent.
“Environmental Law”
means any applicable Law in effect as of the date of this Agreement, and any governmental order or binding agreement with any Governmental
Entity in effect as of the date of this Agreement: (a) relating to pollution (or the cleanup thereof) or the protection of natural resources,
endangered or threatened species, human health or safety, or the environment (including ambient or indoor air, soil, surface water or
groundwater, or subsurface strata); or (b) concerning the presence of, exposure to, or the management, manufacture, use, containment,
storage, recycling, reclamation, reuse, treatment, generation, discharge, transportation, processing, production, disposal, or remediation
of any Hazardous Materials.
“ERISA”
means the Employee Retirement Income Security Act of 1974, as amended.
“ERISA Affiliate”
means, with respect to any entity, trade or business, any other entity, trade or business that at any relevant time would be a member
of a group described in Section 414(b), (c), (m) or (o) of the Code or Section 4001(b)(l) of ERISA that includes the first entity, trade
or business, or that is a member of the same “controlled group” as the first entity, trade or business pursuant to
Section 4001(a)(14) of ERISA.
“Exchange Act”
means the Securities Exchange Act of 1934, as amended, and the regulations promulgated thereunder.
“FDA” means
the U.S. Food and Drug Administration.
“FDA Law”
means the Federal Food, Drug, and Cosmetic Act, as amended (21 U.S.C. § 301 et seq.), the Public Health Service Act (42 U.S.C. §
201 et seq.), as amended, and the regulations promulgated thereunder.
“Governmental Entity”
means any federal, foreign, state, county, municipal, provincial, or local governmental authority, court, judicial body, arbitration tribunal,
government or self-regulatory organization, commission, tribunal or organization, or any regulatory, administrative, or other agency,
or any political or other subdivision, department, commission, board, bureau, branch, division, ministry, or instrumentality of any of
the foregoing
“group”
has the meaning ascribed to such term in Section 13(d) of the Exchange Act.
“Hazardous Materials”
means: (a) any material, substance, chemical, waste, product, derivative, compound, mixture, pollutant, contaminant, solid, liquid, mineral
or gas, in each case, whether naturally occurring or man-made, for which liability may be imposed under Environmental Laws; and (b) any
petroleum or petroleum-derived products, radon, radioactive materials or wastes, asbestos in any form, lead or lead-containing materials,
urea formaldehyde foam insulation and polychlorinated biphenyls and per- and poly-fluoroalkyl substances (PFAS) and other emerging contaminants.
“Indebtedness”
of any Person means, without duplication: (a) indebtedness of such Person for borrowed money; (b) obligations of such Person evidenced
by bonds, debentures, notes or similar instruments; (c) obligations of such Person to pay the deferred purchase or acquisition price for
any property or services of such Person or as the deferred purchase price of a business or assets; (d) reimbursement obligations of such
Person in respect of drawn letters of credit or similar instruments issued or accepted by banks and other financial institutions for the
account of such Person; (e) obligations of such Person under a lease to the extent such obligations are required to be classified and
accounted for as a capital lease on a balance sheet of such Person under GAAP; and (f) indebtedness of others as described in clauses
(a) through (e) above guaranteed by such Person; but Indebtedness does not include obligations in respect of repurchase agreements,
securitizations, re-securitizations and similar financing arrangements, accounts payable to trade creditors, or accrued expenses arising
in the ordinary course of business, in each case, that are not yet due and payable, or are being disputed in good faith, and the endorsement
of negotiable instruments for collection in the ordinary course of business.
“Intellectual Property”
means any and all proprietary and intellectual property rights, under the applicable Law of any jurisdiction or rights under international
treaties, both statutory and common law rights, including: (a) patents and industrial property rights; (b) trademarks, service marks,
trade names, slogans, domain names, logos, trade dress and other identifiers of source, and registrations and applications for registrations
thereof (including all goodwill associated with the foregoing); (c) rights associated with works of authorship, including exclusive exploitation
rights, copyrightable works, copyrights, moral rights, computer programs, software, databases, and mask works; (d) trade secrets, know-how,
and rights in confidential information, including designs, formulations, concepts, compilations of information, methods, techniques, procedures,
and processes, whether or not patentable; (e) other similar proprietary rights in intellectual property of every kind and nature; (f)
rights of privacy and publicity; and (g) all registrations, renewals, extensions, statutory invention registrations, continuations, continuations-in-part,
provisionals, divisionals, or reissues of, and applications for, any of the rights referred to in clauses (a) through (f) above (whether
or not in tangible form and including all tangible embodiments of any of the foregoing, such as samples, studies and summaries), along
with all rights to prosecute and perfect the same through administrative prosecution, registration, recordation or other administrative
proceeding, and all causes of action and rights to sue or seek other remedies arising from or relating to the foregoing, including for
past, present or future infringement of any of the foregoing.
“Investment Company
Act” means the Investment Company Act of 1940, as amended, and the rules and regulations promulgated thereunder.
“IRS” means
the U.S. Internal Revenue Service.
“knowledge”
means the actual knowledge, after reasonable inquiry, of (a) in the case of the Company, the individuals listed in Section 1.1
of the Company Disclosure Letter and (b) in the case of Parent, the individuals listed in Section 1.1 of the Parent Disclosure
Letter.
“Law” means
any law, rule, regulation, ordinance, code, judgment, order, treaty, convention, governmental directive or other legally enforceable requirement,
U.S. or non-U.S., of any Governmental Entity, including common law.
“Lien”
means any lien, pledge, hypothecation, mortgage, deed of trust, security interest, conditional or installment sale agreement, encumbrance,
option, right of first refusal, easement, right of way, encroachment, preemptive right, community property interest or restriction of
any nature (including any restriction on the voting of any security, any restriction on the transfer of any security or other asset, or
any restriction on the possession, exercise or transfer of any other attribute of ownership of any asset), whether voluntarily incurred,
consensual, non-consensual or arising by operation of Law.
“made available”
means, with respect to any statement in this Agreement, the Company Disclosure Letter or the Parent Disclosure Letter to the effect that
any information, document or other material has been “made available,” that such information, document or material
was: (a) uploaded for review by Parent and its Representatives or the Company and its Representatives, as applicable, in the virtual
data room established in connection with the Transactions prior to the execution of this Agreement; or (b) contained in a true and complete
unredacted form in the Company SEC Documents or the Parent SEC Documents, as applicable, filed at least two (2) Business Days prior to
the date hereof.
“Material
Adverse Effect” means, when used with respect to any Person, any fact, circumstance, occurrence, state of fact, effect,
change, event or development that, individually or in the aggregate, has had or would reasonably be expected to have a material
adverse effect on (a) the financial condition, business, assets, properties or results of operations of such Person and its
Subsidiaries, taken as a whole, or (b) the ability of such Person and its Subsidiaries to consummate the Transactions before the End
Date; provided, however, that no fact, circumstance, occurrence, state of fact, effect, change, event or development
(by itself or when aggregated or taken together with any and all other effects) resulting from, arising out of, attributable to, or
related to any of the following shall be deemed to be or constitute a “Material Adverse Effect,” and no effect
(by itself or when aggregated or taken together with any and all other such effects) directly or indirectly resulting from, arising
out of, attributable to, or related to any of the following shall be taken into account when determining whether a
“Material Adverse Effect” under the foregoing clause (a) exists or has occurred or is reasonably expected
to occur: (i) general economic conditions (or changes in such conditions) or conditions in the global economy generally; (ii)
conditions (or changes in such conditions) in any industry or industries in which the Person operates; (iii) political conditions
(or changes in such conditions) or acts of war, sabotage, terrorism, acts of God, epidemics, pandemics or disease outbreaks
(including COVID-19 and any actions or events resulting therefrom) (including any escalation or general worsening of any such acts
of war, sabotage, terrorism, acts of God, epidemics, pandemics or disease outbreaks (including COVID-19 and any COVID-19 Measures or
other actions or events resulting therefrom)); (iv) earthquakes, hurricanes, tsunamis, tornadoes, floods, mudslides, wild fires,
other natural disasters or other weather conditions; (v) changes in Law or other legal or regulatory conditions, or the
interpretation thereof, or changes in GAAP or other accounting standards (or the interpretation thereof); (vi) the announcement of
this Agreement or the pendency or consummation of the Transactions; (vii) any actions taken or failure to take action, in each case,
at the request of another party to this Agreement (treating Parent and Merger Sub as one party); (viii) compliance with the terms
of, or the taking of any action expressly permitted or required by, this Agreement; (ix) any changes in such Person’s stock
price, dividends or the trading volume of such Person’s stock, or any failure by such Person to meet any analysts’
estimates or expectations of such Person’s revenue, earnings or other financial performance or results of operations for any
period, or any failure by such Person or any of its Subsidiaries to meet any internal budgets, plans or forecasts of its revenues,
earnings or other financial performance or results of operations (it being understood that the facts or occurrences giving rise to
or contributing to such changes or failures may constitute, or be taken into account in determining whether there has been or will
be, a Material Adverse Effect); (x) any Proceedings made or brought by any of the current or former shareholders of such Person (on
their own behalf or on behalf of such Person) against the Company, Parent, Merger Sub or any of their directors or officers, arising
out of the Merger or in connection with any other Transactions; or (xii) with respect to a Parent Material Adverse Effect, anything
set forth in the Parent Disclosure Letter, and with respect to a Company Material Adverse Effect, anything set forth in the Company
Disclosure Letter; except to the extent such effects resulting from, arising out of, attributable to or related to the matters
described in the foregoing clauses (i) through (v) disproportionately adversely affect such Person and its
Subsidiaries, taken as a whole, as compared to other Persons that conduct business in the regions in the world and in the industries
in which such Person and its Subsidiaries conduct business (in which case, the incremental adverse effects (if any) shall be taken
into account when determining whether a “Material Adverse Effect” exists, has occurred or is reasonably expected
to occur).
“NASDAQ”
means the NASDAQ Capital Market and any successor stock exchange or quotation system operated by the New York Stock Exchange or any successor
thereto.
“Ordinary course
of business” means the ordinary course of business consistent with past custom and practice (including with respect to quantity
and frequency).
“Organizational Documents”
means (a) with respect to a corporation, the charter, articles, articles supplementary or certificate of incorporation, as applicable,
and bylaws thereof, (b) with respect to a limited liability company, the certificate or articles of formation or organization, as applicable,
and the operating or limited liability company agreement thereof, (c) with respect to a partnership, the certificate of formation and
the partnership agreement thereof, and (d) with respect to any other Person the organizational, constituent and/or governing documents
and/or instruments of such Person.
“Other party”
means (a) when used with respect to the Company, Parent and Merger Sub and (b) when used with respect to Parent or Merger Sub, the Company.
“Parent Associate”
means any current or former employee, independent contractor, officer or director of the Parent or any of its Subsidiaries.
“Parent Capital Stock”
means Parent Common Stock and Parent Preferred Stock.
“Parent Common Stock”
means the common stock of Parent, par value $0.001 per share.
“Parent Intellectual
Property” means the Intellectual Property used in the operation of the business of each of Parent and its Subsidiaries as presently
conducted.
“Parent Preferred
Stock” means the Preferred Stock of the Parent, par value $0.001 per share, including any series thereof which is created.
“Parent Shareholders”
means the holders of Parent Common Stock and the holders of Parent Preferred Stock.
“Parent’s Products”
means AditxtScore™, Adimune™, and/or Adivir™.
“party”
or “parties” means a party or the parties to this Agreement, except as the context may otherwise require.
“Permitted Lien”
means any Lien (a) for Taxes or governmental assessments, charges or claims of payment not yet delinquent or that are being contested
in good faith by appropriate Proceedings, (b) relating to any Indebtedness disclosed in the Company Disclosure Letter, (c) which is a
carriers’, warehousemen’s, mechanics’, materialmen’s, repairmen’s or other similar Liens arising by operation
of Law in the ordinary course of business for amounts not yet delinquent or is being contested in good faith by appropriate Proceedings,
(d) which is not material in amount and would not reasonably be expected to materially interfere with the ordinary conduct of the business
of the Company and its Subsidiaries as currently conducted, (e) which is a statutory or common law lien or encumbrance to secure landlords,
lessors or renters under leases or rental agreements, (f) which is imposed on the underlying fee interest in real property subject to
a company lease or over which the Company has easement rights, and subordination or similar agreements relating thereto, (g) which is
a zoning, building, planning, land use or other similar restriction, (h) which is a publicly recorded easement, covenant, right-of-way,
quasi-easement, license, restriction, utility agreement or defect, imperfection or irregularity of title or (i) which is identified in
the Company Disclosure Letter.
“Person”
means any individual, corporation, partnership, limited partnership, limited liability company, group (including a “person”
as defined in Section 13(d)(3) of the Exchange Act), trust, association or other entity or organization (including any Governmental Entity
or a political subdivision, agency or instrumentality of a Governmental Entity).
“Proceeding”
means any actual or threatened claim (including a claim of a violation of applicable Law), action, audit, demand, suit, proceeding, investigation
or other proceeding at law or in equity or order or ruling, in each case whether civil, criminal, administrative, investigative or otherwise
and whether or not such claim, action, audit, demand, suit, proceeding, investigation or other proceeding or order or ruling results in
a formal civil or criminal litigation or regulatory action.
“Product”
means EVO100 or EVO200, as the context requires.
“Representatives”
means, with respect to any Person, the officers, directors, employees, accountants, consultants, agents, legal counsel, financial advisors
and other representatives of such Person.
“SEC” means
the United States Securities and Exchange Commission.
“Securities Act”
means the Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder.
“Significant Subsidiary”
means, with respect to a Person, a Subsidiary of such Person that qualifies as a “Significant Subsidiary” under Item
1.02(w) of Regulation S-X of the SEC.
“Subsidiary”
means, with respect to a Person, any Person, whether incorporated or unincorporated, of which (a) at least 50% of the securities or ownership
interests having by their terms ordinary voting power to elect a majority of the board of directors or other Persons performing similar
functions, (b) a general partner interest or (c) a managing member interest, is directly or indirectly owned or controlled by the subject
Person or by one or more of its respective Subsidiaries.
“Takeover Law”
means any “fair price,” “moratorium,” “control share acquisition,” “business
combination” or any other takeover or anti-takeover statute or similar statute enacted under applicable Law.
“Tax” or
“Taxes” means any and all U.S. federal, state, local and non-U.S. taxes, assessments, levies, duties, tariffs, imposts
and other similar charges and fees imposed by any Governmental Entity, including, income, franchise, windfall or other profits, gross
receipts, property, sales, use, net worth, capital stock, payroll, employment, social security, workers’ compensation, unemployment
compensation, excise, withholding, ad valorem, stamp, transfer, value-added, occupation, environmental, disability, real property, escheat,
personal property, registration, alternative or add-on minimum or estimated tax, including any interest, penalty, additions to tax or
additional amounts imposed with respect thereto, whether disputed or not and including any obligations to indemnify or otherwise assume
or succeed to the Tax liability of any other Person.
“Tax Returns”
means any return, report, certificate, claim for refund, election, estimated tax filing or declaration filed or required to be filed with
any Taxing Authority, including any schedule or attachment thereto, and including any amendments thereof.
“Taxing Authority”
means any Governmental Entity having jurisdiction in matters relating to Tax matters.
“Transaction Agreements”
means this Agreement and each other agreement to be executed and delivered in connection herewith and therewith.
“Transfer Taxes”
means any stock transfer, real estate transfer, documentary, stamp, recording and other similar Taxes (including interest, penalties and
additions to any such Taxes); provided, for the avoidance of doubt, which Transfer Taxes shall not include any income, franchise or similar
Taxes arising from the Transactions.
“Voting Debt”
of a Person means bonds, debentures, notes or other Indebtedness having the right to vote (or convertible into securities having the right
to vote) on any matters on which shareholders of such Person may vote.
A-8
Exhibit 4.1
NEITHER
THE ISSUANCE AND SALE OF THE SECURITIES REPRESENTED BY THIS CERTIFICATE NOR THE SECURITIES INTO WHICH THESE SECURITIES ARE EXERCISABLE
HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE STATE SECURITIES LAWS. THE SECURITIES MAY NOT BE OFFERED
FOR SALE, SOLD, TRANSFERRED OR ASSIGNED (I) IN THE ABSENCE OF (A) AN EFFECTIVE REGISTRATION STATEMENT FOR THE SECURITIES UNDER THE SECURITIES
ACT OF 1933, AS AMENDED, OR (B) AN OPINION OF COUNSEL TO THE HOLDER (IF REQUESTED BY THE COMPANY), IN A FORM REASONABLY ACCEPTABLE TO
THE COMPANY, THAT REGISTRATION IS NOT REQUIRED UNDER SAID ACT OR (II) UNLESS SOLD OR ELIGIBLE TO BE SOLD PURSUANT TO RULE 144 OR RULE
144A UNDER SAID ACT. NOTWITHSTANDING THE FOREGOING, THE SECURITIES MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT OR OTHER
LOAN OR FINANCING ARRANGEMENT SECURED BY THE SECURITIES. THE NUMBER OF SHARES OF COMMON STOCK ISSUABLE UPON EXERCISE OF THIS WARRANT MAY
BE LESS THAN THE AMOUNTS SET FORTH ON THE FACE HEREOF PURSUANT TO SECTION 1(a) OF
THIS WARRANT.
Aditxt, Inc.
Warrant To Purchase Common Stock
Warrant No.:
Date of Issuance: July 12, 2024 (“Issuance
Date”)
Aditxt, Inc., a Delaware corporation
(the “Company”), hereby certifies that, for good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, _____________________________________, the registered holder hereof
or its permitted assigns (the “Holder”), is entitled, subject to the terms set forth below, to purchase from the Company,
at the Exercise Price (as defined below) then in effect, upon exercise of this Warrant to Purchase Common Stock (including any Warrants
to Purchase Common Stock issued in exchange, transfer or replacement hereof, the “Warrant”), at any time or times on
or after the six month and one day anniversary of the Issuance Date (the “Initial Exercisability Date”), but not after
11:59 p.m., New York time, on the Expiration Date (as defined below), ______________________ ____________________________________ (subject
to adjustment as provided herein) fully paid and non-assessable shares of Common Stock (as defined below) (the “Warrant Shares”,
and such number of Warrant Shares, the “Warrant Number”). Except as otherwise defined herein, capitalized terms in
this Warrant shall have the meanings set forth in Section 19. This Warrant is one of the Warrants to Purchase Common Stock (the “SPA
Warrants”) issued pursuant to Section 2.1 of that certain Securities Purchase Agreement, dated as of July 12, 2024 (the
“Subscription Date”), by and among the Company and the investors (the “Buyers”) referred to therein,
as amended from time to time (the “Securities Purchase Agreement”).
1. EXERCISE
OF WARRANT.
(a) Mechanics of Exercise.
Subject to the terms and conditions hereof (including, without limitation, the limitations set forth in Section 1(f)), this Warrant
may be exercised by the Holder on any day on or after the Initial Exercisability Date (an “Exercise Date”), in whole
or in part, by delivery (whether via facsimile or otherwise) of a written notice, in the form attached hereto as Exhibit A
(the “Exercise Notice”), of the Holder’s election to exercise this Warrant. Within one (1) Trading Day following
an exercise of this Warrant as aforesaid, the Holder shall deliver payment to the Company of an amount equal to the Exercise Price in
effect on the date of such exercise multiplied by the number of Warrant Shares as to which this Warrant was so exercised (the “Aggregate
Exercise Price”) in cash or via wire transfer of immediately available funds if the Holder did not notify the Company in such
Exercise Notice that such exercise was made pursuant to a Cashless Exercise (as defined in Section 1(d)). The Holder shall not be
required to deliver the original of this Warrant in order to effect an exercise hereunder. Execution and delivery of an Exercise Notice
with respect to less than all of the Warrant Shares shall have the same effect as cancellation of the original of this Warrant and issuance
of a new Warrant evidencing the right to purchase the remaining number of Warrant Shares. Execution and delivery of an Exercise Notice
for all of the then-remaining Warrant Shares shall have the same effect as cancellation of the original of this Warrant after delivery
of the Warrant Shares in accordance with the terms hereof. On or before the first (1st) Trading Day following the date on
which the Company has received an Exercise Notice, the Company shall transmit by facsimile or electronic mail an acknowledgment of confirmation
of receipt of such Exercise Notice, in the form attached hereto as Exhibit B, to the Holder and the Company’s
transfer agent (the “Transfer Agent”), which confirmation shall constitute an instruction to the Transfer Agent to
process such Exercise Notice in accordance with the terms herein. On or before the second (2nd) Trading Day following the date on which
the Company has received such Exercise Notice (or such earlier date as required pursuant to the 1934 Act or other applicable law, rule
or regulation for the settlement of a trade of such Warrant Shares initiated on the applicable Exercise Date), the Company shall (X)
provided that the Transfer Agent is participating in The Depository Trust Company (“DTC”) Fast Automated Securities
Transfer Program, upon the request of the Holder, credit such aggregate number of shares of Common Stock to which the Holder is entitled
pursuant to such exercise to the Holder’s or its designee’s balance account with DTC through its Deposit/Withdrawal at Custodian
system, or (Y) if the Transfer Agent is not participating in the DTC Fast Automated Securities Transfer Program (“FAST”),
upon the request of the Holder, issue and deliver (via reputable overnight courier) to the address as specified in the Exercise Notice,
a certificate, registered in the name of the Holder or its designee, for the number of shares of Common Stock to which the Holder shall
be entitled pursuant to such exercise. Upon delivery of an Exercise Notice, 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
such Warrant Shares are credited to the Holder’s DTC account or the date of delivery of the certificates evidencing such Warrant
Shares (as the case may be). If this Warrant is submitted in connection with any exercise pursuant to this Section 1(a) and the
number of Warrant Shares represented by this Warrant submitted for exercise is greater than the number of Warrant Shares being acquired
upon an exercise and upon surrender of this Warrant to the Company by the Holder, then, at the request of the Holder, the Company shall
as soon as practicable and in no event later than two (2) Business Days after any exercise and at its own expense, issue and deliver
to the Holder (or its designee) a new Warrant (in accordance with Section 7(d)) representing the right to purchase the number of
Warrant Shares purchasable immediately prior to such exercise under this Warrant, less the number of Warrant Shares with respect to which
this Warrant is exercised. No fractional shares of Common Stock are to be issued upon the exercise of this Warrant, but rather the number
of shares of Common Stock to be issued shall be rounded up to the nearest whole number. The Company shall pay any and all transfer, stamp,
issuance and similar taxes, costs and expenses (including, without limitation, fees and expenses of the Transfer Agent) that may be payable
with respect to the issuance and delivery of Warrant Shares upon exercise of this Warrant. Notwithstanding the foregoing, except in the
case where an exercise of this Warrant is validly made pursuant to a Cashless Exercise, the Company’s failure to deliver Warrant
Shares to the Holder on or prior to the later of (i) two (2) Trading Days after receipt of the applicable Exercise Notice (or such earlier
date as required pursuant to the 1934 Act or other applicable law, rule or regulation for the settlement of a trade of such Warrant Shares
initiated on the applicable Exercise Date) and (ii) one (1) Trading Day after the Company’s receipt of the Aggregate Exercise Price
(or valid notice of a Cashless Exercise) (such later date, the “Share Delivery Date”) shall not be deemed to be a
breach of this Warrant. Notwithstanding anything to the contrary contained in this Warrant or the Securities Purchase Agreement, after
the effective date of the registration statement, the Company shall cause the Transfer Agent to deliver unlegended shares of Common Stock
to the Holder (or its designee) in connection with any sale of Warrant Shares with respect to which the Holder has entered into a contract
for sale, and delivered a copy of the prospectus included as part of the particular Registration Statement to the extent applicable,
and for which the Holder has not yet settled. From the Issuance Date through and including the Expiration Date, the Company shall maintain
a transfer agent that participates in FAST.
(b) Exercise Price.
For purposes of this Warrant, “Exercise Price” means $1.582, subject to adjustment as provided herein.
(c) Company’s Failure
to Timely Deliver Securities. If the Company shall fail, for any reason or for no reason, on or prior to the Share Delivery Date,
either (I) if the Transfer Agent is not participating in FAST, to issue and deliver to the Holder (or its designee) a certificate for
the number of Warrant Shares to which the Holder is entitled and register such Warrant Shares on the Company’s share register or,
if the Transfer Agent is participating in FAST, to credit the balance account of the Holder or the Holder’s designee with DTC for
such number of Warrant Shares to which the Holder is entitled upon the Holder’s exercise of this Warrant (as the case may be) or
(II) if a Registration Statement covering the resale of the Warrant Shares that are the subject of the Exercise Notice (the “Unavailable
Warrant Shares”) is not available for the resale of such Unavailable Warrant Shares and the Company fails to promptly, but
in no event later than as required pursuant to the Securities Purchase Agreement (x) so notify the Holder and (y) deliver the Warrant
Shares electronically without any restrictive legend by crediting such aggregate number of Warrant Shares to which the Holder is entitled
pursuant to such exercise to the Holder’s or its designee’s balance account with DTC through its Deposit/Withdrawal At Custodian
system (the event described in the immediately foregoing clause (II) is hereinafter referred as a “Notice Failure”
and together with the event described in clause (I) above, a “Delivery Failure”), then, in addition to all other remedies
available to the Holder, (X) the Company shall pay in cash to the Holder on each day after the Share Delivery Date and during such Delivery
Failure an amount equal to 2% of the product of (A) the sum of the number of shares of Common Stock not issued to the Holder on or prior
to the Share Delivery Date and to which the Holder is entitled, multiplied by (B) any trading price of the Common Stock selected by the
Holder in writing as in effect at any time during the period beginning on the applicable Exercise Date and ending on the applicable Share
Delivery Date, and (Y) the Holder, upon written notice to the Company, may void its Exercise Notice with respect to, and retain or have
returned, as the case may be, any portion of this Warrant that has not been exercised pursuant to such Exercise Notice; provided that
the voiding of an Exercise Notice shall not affect the Company’s obligations to make any payments which have accrued prior to the
date of such notice pursuant to this Section 1(c) or otherwise. In addition to the foregoing, if on or prior to the Share Delivery Date
either (I) the Transfer Agent is not participating in the DTC Fast Automated Securities Transfer Program, the Company shall fail to issue
and deliver to the Holder (or its designee) a certificate and register such shares of Common Stock on the Company’s share register
or, if the Transfer Agent is participating in the DTC Fast Automated Securities Transfer Program, the Transfer Agent shall fail to credit
the balance account of the Holder or the Holder’s designee with DTC for the number of shares of Common Stock to which the Holder
is entitled upon the Holder’s exercise hereunder or pursuant to the Company’s obligation pursuant to clause (ii) below or
(II) a Notice Failure occurs, and if on or after such Share Delivery Date the Holder acquires (in an open market transaction, stock loan
or otherwise) shares of Common Stock corresponding to all or any portion of the number of shares of Common Stock issuable upon such exercise
that the Holder is entitled to receive from the Company and has not received from the Company in connection with such Delivery Failure
or Notice Failure, as applicable (a “Buy-In”), then, in addition to all other remedies available to the Holder, the
Company shall, within two (2) Business Days after the Holder’s request and in the Holder’s discretion, either (i) pay cash
to the Holder in an amount equal to the Holder’s total purchase price (including brokerage commissions, stock loan costs and other
out-of-pocket expenses, if any) for the shares of Common Stock so acquired (including, without limitation, by any other Person in respect,
or on behalf, of the Holder) (the “Buy-In Price”), at which point the Company’s obligation to so issue and deliver
such certificate (and to issue such shares of Common Stock) or credit the balance account of such Holder or such Holder’s designee,
as applicable, with DTC for the number of Warrant Shares to which the Holder is entitled upon the Holder’s exercise hereunder (as
the case may be) (and to issue such Warrant Shares) shall terminate, or (ii) promptly honor its obligation to so issue and deliver to
the Holder a certificate or certificates representing such Warrant Shares or credit the balance account of such Holder or such Holder’s
designee, as applicable, with DTC for the number of Warrant Shares to which the Holder is entitled upon the Holder’s exercise hereunder
(as the case may be) and pay cash to the Holder in an amount equal to the excess (if any) of the Buy-In Price over the product of (A)
such number of Warrant Shares 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 applicable Exercise Notice and ending on the date of such issuance and payment under this clause (ii) (the
“Buy-In Payment Amount”). Nothing shall limit the 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 certificates representing shares of Common Stock (or to electronically deliver such
shares of Common Stock) upon the exercise of this Warrant as required pursuant to the terms hereof. While this Warrant is outstanding,
the Company shall cause its transfer agent to participate in FAST. In addition to the foregoing rights, (i) if the Company fails to deliver
the applicable number of Warrant Shares upon an exercise pursuant to Section 1 by the applicable Share Delivery Date, then the Holder
shall have the right to rescind such exercise in whole or in part and retain and/or have the Company return, as the case may be, any
portion of this Warrant that has not been exercised pursuant to such Exercise Notice; provided that the rescission of an exercise shall
not affect the Company’s obligation to make any payments that have accrued prior to the date of such notice pursuant to this Section
1(c) or otherwise, and (ii) if a registration statement covering the issuance or resale of the Warrant Shares that are subject to an
Exercise Notice is not available for the issuance or resale, as applicable, of such Warrant Shares and the Holder has submitted an Exercise
Notice prior to receiving notice of the non-availability of such registration statement and the Company has not already delivered the
Warrant Shares underlying such Exercise Notice electronically without any restrictive legend by crediting such aggregate number of Warrant
Shares to which the Holder is entitled pursuant to such exercise to the Holder’s or its designee’s balance account with DTC
through its Deposit / Withdrawal At Custodian system, the Holder shall have the option, by delivery of notice to the Company, to (x)
rescind such Exercise Notice in whole or in part and retain or have returned, as the case may be, any portion of this Warrant that has
not been exercised pursuant to such Exercise Notice; provided that the rescission of an Exercise Notice shall not affect the Company’s
obligation to make any payments that have accrued prior to the date of such notice pursuant to this Section 1(c) or otherwise, and/or
(y) switch some or all of such Exercise Notice from a cash exercise to a Cashless Exercise.
(d) Cashless Exercise.
Notwithstanding anything contained herein to the contrary (other than Section 1(f) below), if at the time of exercise hereof a registration
statement is not effective (or the prospectus contained therein is not available for use) for the resale by the Holder of all of the
Warrant Shares, then the Holder may, in its sole discretion, exercise this Warrant in whole or in part and, in lieu of making the cash
payment otherwise contemplated to be made to the Company upon such exercise in payment of the Aggregate Exercise Price, elect instead
to receive upon such exercise the “Net Number” of Warrant Shares determined according to the following formula (a “Cashless
Exercise”):
Net Number = (A x B)
- (A x C)
B
For purposes of the foregoing
formula:
A= the total number of shares with respect
to which this Warrant is then being exercised.
B = as elected by the Holder: (i) the
VWAP of the shares of Common Stock on the Trading Day immediately preceding the date of the applicable Exercise Notice if such Exercise
Notice is (1) both executed and delivered pursuant to Section 1(a) hereof on a day that is not a Trading Day or (2) both executed and
delivered pursuant to Section 1(a) hereof on a Trading Day prior to the opening of “regular trading hours” (as defined in
Rule 600(b)(64) of Regulation NMS promulgated under the federal securities laws) on such Trading Day, (ii) at the option of the Holder,
either (y) the VWAP on the Trading Day immediately preceding the date of the applicable Exercise Notice or (z) the Bid Price of the shares
of Common Stock as of the time of the Holder’s execution of the applicable Exercise Notice if such Exercise Notice is executed during
“regular trading hours” on a Trading Day and is delivered within two (2) hours thereafter pursuant to Section 1(a) hereof,
or (iii) the Closing Sale Price of the Common Stock on the date of the applicable Exercise Notice if the date of such Exercise Notice
is a Trading Day and such Exercise Notice is both executed and delivered pursuant to Section 1(a) hereof after the close of “regular
trading hours” on such Trading Day.
C = the Exercise
Price then in effect for the applicable Warrant Shares at the time of such exercise.
If the Warrant Shares are issued
in a Cashless Exercise, the parties acknowledge and agree that in accordance with Section 3(a)(9) of the 1933 Act, the Warrant Shares
take on the registered characteristics of the Warrants being exercised. For purposes of Rule 144(d) promulgated under the 1933 Act, as
in effect on the Subscription Date, it is intended that the Warrant Shares issued in a Cashless Exercise shall be deemed to have been
acquired by the Holder, and the holding period for the Warrant Shares shall be deemed to have commenced, on the date this Warrant was
originally issued pursuant to the Securities Purchase Agreement.
(e) Disputes. In the
case of a dispute as to the determination of the Exercise Price or the arithmetic calculation of the number of Warrant Shares to be issued
pursuant to the terms hereof, the Company shall promptly issue to the Holder the number of Warrant Shares that are not disputed and resolve
such dispute in accordance with Section 15.
(f) Limitations on Exercises.
The Company shall not effect the exercise of any portion of this Warrant, and the Holder shall not have the right to exercise any portion
of this Warrant, pursuant to the terms and conditions of this Warrant and any such exercise shall be null and void and treated as if
never made, to the extent that after giving effect to such exercise, the Holder together with the other Attribution Parties collectively
would beneficially own in excess of 4.99% (the “Maximum Percentage”) of the shares of Common Stock outstanding immediately
after giving effect to such exercise. For purposes of the foregoing sentence, the aggregate number of shares of Common Stock beneficially
owned by the Holder and the other Attribution Parties shall include the number of shares of Common Stock held by the Holder and all other
Attribution Parties plus the number of shares of Common Stock issuable upon exercise of this Warrant with respect to which the determination
of such sentence is being made, but shall exclude shares of Common Stock which would be issuable upon (A) exercise of the remaining,
unexercised portion of this Warrant beneficially owned by the Holder or any of the other Attribution Parties and (B) exercise or conversion
of the unexercised or unconverted portion of any other securities of the Company (including, without limitation, any convertible notes
or convertible preferred stock or warrants, including other SPA Warrants) beneficially owned by the Holder or any other Attribution Party
subject to a limitation on conversion or exercise analogous to the limitation contained in this Section 1(f)(i). For purposes of this
Section 1(f)(i), beneficial ownership shall be calculated in accordance with Section 13(d) of the 1934 Act. For purposes of determining
the number of outstanding shares of Common Stock the Holder may acquire upon the exercise of this Warrant without exceeding the Maximum
Percentage, the Holder may rely on the number of outstanding shares of Common Stock as reflected in (x) the Company’s most recent
Annual Report on Form 10-K, Quarterly Report on Form 10-Q, Current Report on Form 8-K or other public filing with the SEC, as the case
may be, (y) a more recent public announcement by the Company or (z) any other written notice by the Company or the Transfer Agent, if
any, setting forth the number of shares of Common Stock outstanding (the “Reported Outstanding Share Number”). If
the Company receives an Exercise Notice from the Holder at a time when the actual number of outstanding shares of Common Stock is less
than the Reported Outstanding Share Number, the Company shall (i) notify the Holder in writing of the number of shares of Common Stock
then outstanding and, to the extent that such Exercise Notice would otherwise cause the Holder’s beneficial ownership, as determined
pursuant to this Section 1(f)(i), to exceed the Maximum Percentage, the Holder must notify the Company of a reduced number of Warrant
Shares to be acquired pursuant to such Exercise Notice (the number of shares by which such purchase is reduced, the “Reduction
Shares”) and (ii) as soon as reasonably practicable, the Company shall return to the Holder any exercise price paid by the
Holder for the Reduction Shares. For any reason at any time, upon the written or oral request of the Holder, the Company shall within
one (1) Business Day confirm orally and in writing or by electronic mail 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 and any other Attribution Party since the date as of which the Reported
Outstanding Share Number was reported. In the event that the issuance of shares of Common Stock to the Holder upon exercise of this Warrant
results in the Holder and the other Attribution Parties being deemed to beneficially own, in the aggregate, more than the Maximum Percentage
of the number of outstanding shares of Common Stock (as determined under Section 13(d) of the 1934 Act), the number of shares so issued
by which the Holder’s and the other Attribution Parties’ aggregate beneficial ownership exceeds the Maximum Percentage (the
“Excess Shares”) shall be deemed null and void and shall be cancelled ab initio, and the Holder shall not have the
power to vote or to transfer the Excess Shares. As soon as reasonably practicable after the issuance of the Excess Shares has been deemed
null and void, the Company shall return to the Holder the exercise price paid by the Holder for the Excess Shares. Upon delivery of a
written notice to the Company, the Holder may from time to time increase (with such increase not effective until the sixty-first (61st)
day after delivery of such notice) or decrease the Maximum Percentage to any other percentage not in excess of 9.99% as specified in
such notice; provided that (i) any such increase in the Maximum Percentage will not be effective until the sixty-first (61st)
day after such notice is delivered to the Company and (ii) any such increase or decrease will apply only to the Holder and the other
Attribution Parties and not to any other holder of SPA Warrants that is not an Attribution Party of the Holder. For purposes of clarity,
the shares of Common Stock issuable pursuant to the terms of this Warrant in excess of the Maximum Percentage shall not be deemed to
be beneficially owned by the Holder for any purpose including for purposes of Section 13(d) or Rule 16A(a)(1) of the 1934 Act. No prior
inability to exercise this Warrant pursuant to this paragraph shall have any effect on the applicability of the provisions of this paragraph
with respect to any subsequent determination of exercisability. The provisions of this paragraph shall be construed and implemented in
a manner otherwise than in strict conformity with the terms of this Section 1(f)(i) to the extent necessary to correct this paragraph
or any portion of this paragraph which may be defective or inconsistent with the intended beneficial ownership limitation contained in
this Section 1(f)(i) or to make changes or supplements necessary or desirable to properly give effect to such limitation. The limitation
contained in this paragraph may not be waived and shall apply to a successor holder of this Warrant.
(g) Reservation of Shares.
(i) Required
Reserve Amount. So long as this Warrant remains outstanding, the Company shall at all times keep reserved for issuance under this
Warrant a number of shares of Common Stock at least (x) if prior to May 31, 2024 (or, if earlier, the Stockholder Approval Date (as defined
in the Securities Purchase Agreement)) (the “Initial Reserve Expiration Date”), the Initial Reserve Amount (as defined
in the Securities Purchase Agreement) or (y) from and after the Initial Reserve Expiration Date, 200% of the maximum number of shares
of Common Stock as shall be necessary to satisfy the Company’s obligation to issue shares of Common Stock under the SPA Warrants
then outstanding (without regard to any limitations on exercise) (collectively, the “Required Reserve Amount”); provided
that at no time shall the number of shares of Common Stock reserved pursuant to this Section 1(g)(i) be reduced other than proportionally
in connection with any exercise or redemption of SPA Warrants or such other event covered by Section 2(a) below. The Required Reserve
Amount (including, without limitation, each increase in the number of shares so reserved) shall be allocated pro rata among the holders
of the SPA Warrants based on number of shares of Common Stock issuable upon exercise of SPA Warrants held by each holder on the Closing
Date (without regard to any limitations on exercise) or increase in the number of reserved shares, as the case may be (the “Authorized
Share Allocation”). In the event that a holder shall sell or otherwise transfer any of such holder’s SPA Warrants, each
transferee shall be allocated a pro rata portion of such holder’s Authorized Share Allocation. Any shares of Common Stock reserved
and allocated to any Person which ceases to hold any SPA Warrants shall be allocated to the remaining holders of SPA Warrants, pro rata
based on the number of shares of Common Stock issuable upon exercise of the SPA Warrants then held by such holders (without regard to
any limitations on exercise).
(ii) Insufficient
Authorized Shares. If, notwithstanding Section 1(g)(i) above, and not in limitation thereof, at any time while any of the SPA Warrants
remain outstanding, the Company does not have a sufficient number of authorized and unreserved shares of Common Stock to satisfy its
obligation to reserve the Required Reserve Amount (an “Authorized Share Failure”), then the Company shall immediately
take all action necessary to increase the Company’s authorized shares of Common Stock to an amount sufficient to allow the Company
to reserve the Required Reserve Amount for all the SPA Warrants then outstanding. Without limiting the generality of the foregoing sentence,
as soon as practicable after the date of the occurrence of an Authorized Share Failure, but in no event later than sixty (60) days after
the occurrence of such Authorized Share Failure, the Company shall hold a meeting of its stockholders for the approval of an increase
in the number of authorized shares of Common Stock. In connection with such meeting, the Company shall provide each stockholder with
a proxy statement and shall use its best efforts to solicit its stockholders’ approval of such increase in authorized shares of
Common Stock and to cause its board of directors to recommend to the stockholders that they approve such proposal. Notwithstanding the
foregoing, if any such time of an Authorized Share Failure, the Company is able to obtain the written consent of a majority of the shares
of its issued and outstanding shares of Common Stock to approve the increase in the number of authorized shares of Common Stock, the
Company may satisfy this obligation by obtaining such consent and submitting for filing with the SEC an Information Statement on Schedule
14C. In the event that the Company is prohibited from issuing shares of Common Stock upon an exercise of this Warrant due to the failure
by the Company to have sufficient shares of Common Stock available out of the authorized but unissued shares of Common Stock (such unavailable
number of shares of Common Stock, the “Authorization Failure Shares”), in lieu of delivering such Authorization Failure
Shares to the Holder, the Company shall pay cash in exchange for the cancellation of such portion of this Warrant exercisable into such
Authorization Failure Shares at a price equal to the sum of (i) the product of (x) such number of Authorization Failure Shares and (y)
the greatest Closing Sale Price of the Common Stock on any Trading Day during the period commencing on the date the Holder delivers the
applicable Exercise Notice with respect to such Authorization Failure Shares to the Company and ending on the date of such issuance and
payment under this Section 1(g); and (ii) to the extent the Holder purchases (in an open market transaction or otherwise) shares of Common
Stock to deliver in satisfaction of a sale by the Holder of Authorization Failure Shares, any Buy-In Payment Amount, brokerage commissions
and other out-of-pocket expenses, if any, of the Holder incurred in connection therewith. Nothing contained in this Section 1(g) shall
limit any obligations of the Company under any provision of the Securities Purchase Agreement.
2. ADJUSTMENT
OF EXERCISE PRICE AND NUMBER OF WARRANT SHARES. Following the Stockholder approval Date, the
Exercise Price and number of Warrant Shares issuable upon exercise of this Warrant are subject to adjustment from time to time as set
forth in this Section 2.
(a) Stock Dividends and
Splits. Without limiting any provision of Section 2, Section 3 or Section 4, if the Company, at any time on or after the
Subscription Date, (i) pays a stock dividend on one or more classes of its then outstanding shares of Common Stock or otherwise makes
a distribution on any class of capital stock that is payable in shares of Common Stock, (ii) subdivides (by any stock split, stock dividend,
recapitalization or otherwise) one or more classes of its then outstanding shares of Common Stock into a larger number of shares or (iii)
combines (by combination, reverse stock split or otherwise) one or more classes of its then outstanding shares of Common Stock into a
smaller number of shares, then in each such case the Exercise Price shall be multiplied by a fraction of which the numerator shall be
the number of shares of Common Stock 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 clause (i) of this paragraph shall become effective
immediately after the record date for the determination of stockholders entitled to receive such dividend or distribution, and any adjustment
pursuant to clause (ii) or (iii) of this paragraph shall become effective immediately after the effective date of such subdivision or
combination. If any event requiring an adjustment under this paragraph occurs during the period that an Exercise Price is calculated
hereunder, then the calculation of such Exercise Price shall be adjusted appropriately to reflect such event.
(b) Adjustment Upon Issuance
of Shares of Common Stock. If and whenever on or after the Subscription Date the Company grants, issues or sells (or enters into
any agreement to grant, issue or sell), or in accordance with this Section 2(b) is deemed to have granted, issued or sold, any shares
of Common Stock (including the granting, issuance or sale of shares of Common Stock owned or held by or for the account of the Company,
but excluding any Excluded Securities granted, issued or sold or deemed to have been granted, issued or sold) for a consideration per
share (the “New Issuance Price”) less than a price equal to the Exercise Price in effect immediately prior to such
granting, issuance or sale or deemed granting, issuance or sale (such Exercise Price then in effect is referred to herein as the “Applicable
Price”) (the foregoing a “Dilutive Issuance”), then, immediately after such Dilutive Issuance, the Exercise
Price then in effect shall be reduced to an amount equal to the New Issuance Price. For all purposes of the foregoing (including, without
limitation, determining the adjusted Exercise Price and the New Issuance Price under this Section 2(b), the following shall be applicable:
(i) Issuance
of Options. If the Company in any manner grants, issues or sells (or enters into any agreement to grant, issue or sell) any Options
and the lowest price per share for which one share of Common Stock is at any time issuable upon the exercise of any such Option or upon
conversion, exercise or exchange of any Convertible Securities issuable upon exercise of any such Option or otherwise pursuant to the
terms thereof is less than the Applicable Price, then such share of Common Stock shall be deemed to be outstanding and to have been issued
and sold by the Company at the time of the granting, issuance or sale (or the time of execution of such agreement to grant, issue or
sell, as applicable) of such Option for such price per share. For purposes of this Section 2(b)(i), the “lowest price per share
for which one share of Common Stock is at any time issuable upon the exercise of any such Option or upon conversion, exercise or exchange
of any Convertible Securities issuable upon exercise of any such Option or otherwise pursuant to the terms thereof” shall be equal
to (1) the lower of (x) the sum of the lowest amounts of consideration (if any) received or receivable by the Company with respect to
any one share of Common Stock upon the granting, issuance or sale (or the time of execution of such agreement to grant, issue or sell,
as applicable) of such Option, upon exercise of such Option and upon conversion, exercise or exchange of any Convertible Security issuable
upon exercise of such Option or otherwise pursuant to the terms thereof and (y) the lowest exercise price set forth in such Option for
which one share of Common Stock is issuable (or may become issuable assuming all possible market conditions) upon the exercise of any
such Options or upon conversion, exercise or exchange of any Convertible Securities issuable upon exercise of any such Option or otherwise
pursuant to the terms thereof, minus (2) the sum of all amounts paid or payable to the holder of such Option (or any other Person)
with respect to any one share of Common Stock upon the granting, issuance or sale (or the agreement to grant, issue or sell, as applicable)
of such Option, upon exercise of such Option and upon conversion, exercise or exchange of any Convertible Security issuable upon exercise
of such Option or otherwise pursuant to the terms thereof minus (3) the value of any other consideration (including, without limitation,
consideration consisting of cash, debt forgiveness, assets or any other property) received or receivable by, or benefit conferred on,
the holder of such Option (or any other Person). Except as contemplated below, no further adjustment of the Exercise Price shall be made
upon the actual issuance of such share of Common Stock or of such Convertible Securities upon the exercise of such Options or otherwise
pursuant to the terms thereof or upon the actual issuance of such shares of Common Stock upon conversion, exercise or exchange of such
Convertible Securities.
(ii) Issuance
of Convertible Securities. If the Company in any manner issues or sells (or enters into any agreement to issue or sell) any Convertible
Securities and the lowest price per share for which one share of Common Stock is at any time issuable upon the conversion, exercise or
exchange thereof or otherwise pursuant to the terms thereof is less than the Applicable Price, then such share of Common Stock shall
be deemed to be outstanding and to have been issued and sold by the Company at the time of the issuance or sale (or the time of execution
of such agreement to issue or sell, as applicable) of such Convertible Securities for such price per share. For the purposes of this
Section 2(b)(ii), the “lowest price per share for which one share of Common Stock is at any time issuable upon the conversion,
exercise or exchange thereof or otherwise pursuant to the terms thereof” shall be equal to (1) the lower of (x) the sum of the
lowest amounts of consideration (if any) received or receivable by the Company with respect to one share of Common Stock upon the issuance
or sale (or pursuant to the agreement to issue or sell, as applicable) of the Convertible Security and upon conversion, exercise or exchange
of such Convertible Security or otherwise pursuant to the terms thereof and (y) the lowest conversion price set forth in such Convertible
Security for which one share of Common Stock is issuable (or may become issuable assuming all possible market conditions) upon conversion,
exercise or exchange thereof or otherwise pursuant to the terms thereof minus (2) the sum of all amounts paid or payable to the holder
of such Convertible Security (or any other Person) with respect to any one share of Common Stock upon the issuance or sale (or the agreement
to issue or sell, as applicable) of such Convertible Security plus the value of any other consideration received or receivable (including,
without limitation, any consideration consisting of cash, debt forgiveness, assets or other property) by, or benefit conferred on, the
holder of such Convertible Security (or any other Person). Except as contemplated below, no further adjustment of the Exercise Price
shall be made upon the actual issuance of such shares of Common Stock upon conversion, exercise or exchange of such Convertible Securities
or otherwise pursuant to the terms thereof, and if any such issuance or sale of such Convertible Securities is made upon exercise of
any Options for which adjustment of the Exercise Price has been or is to be made pursuant to other provisions of this Section 2(b), except
as contemplated below, no further adjustment of the Exercise Price shall be made by reason of such issuance or sale.
(iii) Change
in Option Price or Rate of Conversion. If the purchase or exercise price provided for in any Options, the additional consideration,
if any, payable upon the issue, conversion, exercise or exchange of any Convertible Securities, or the rate at which any Convertible
Securities are convertible into or exercisable or exchangeable for shares of Common Stock increases or decreases at any time (other than
proportional changes in conversion or exercise prices, as applicable, in connection with an event referred to in Section 4(b) above),
the Exercise Price in effect at the time of such increase or decrease shall be adjusted to the Exercise Price which would have been in
effect at such time had such Options or Convertible Securities provided for such increased or decreased purchase price, additional consideration
or increased or decreased conversion rate (as the case may be) at the time initially granted, issued or sold. For purposes of this Section
2(b)(iii), if the terms of any Option or Convertible Security (including, without limitation, any Option or Convertible Security that
was outstanding as of the Subscription Date) are increased or decreased in the manner described in the immediately preceding sentence,
then such Option or Convertible Security and the shares of Common Stock deemed issuable upon exercise, conversion or exchange thereof
shall be deemed to have been issued as of the date of such increase or decrease. No adjustment pursuant to this Section 2(b) shall be
made if such adjustment would result in an increase of the Exercise Price then in effect.
(iv) Calculation
of Consideration Received. If any Option and/or Convertible Security and/or Adjustment Right is issued in connection with the issuance
or sale or deemed issuance or sale of any other securities of the Company (as determined by the Required Holders, the “Primary
Security”, and such Option and/or Convertible Security and/or Adjustment Right, the “Secondary Securities”
and together with the Primary Security, each a “Unit”), together comprising one integrated transaction, the aggregate
consideration per share of Common Stock with respect to such Primary Security shall be deemed to be the lower of (x) the purchase price
of such Unit, (y) if such Primary Security is an Option and/or Convertible Security, the lowest price per share for which one share of
Common Stock is at any time issuable upon the exercise or conversion of the Primary Security in accordance with Section 2(b)(i) or 2(b)(ii)
above and (z) the lowest VWAP of the shares of Common Stock on any Trading Day during the five (5) Trading Day period (the “Adjustment
Period”) immediately following the public announcement of such Dilutive Issuance (for the avoidance of doubt, if such public
announcement is released prior to the opening of the Principal Market on a Trading Day, such Trading Day shall be the first Trading Day
in such five Trading Day period and if this Warrant is exercised, on any given Exercise Date during any such Adjustment Period, solely
with respect to such portion of this Warrant converted on such applicable Exercise Date, such applicable Adjustment Period shall be deemed
to have ended on, and included, the Trading Day immediately prior to such Exercise Date). If any shares of Common Stock, Options or Convertible
Securities are issued or sold or deemed to have been issued or sold for cash, the consideration received therefor will be deemed to be
the net amount of consideration received by the Company therefor. If any shares of Common Stock, Options or Convertible Securities are
issued or sold for a consideration other than cash, the amount of such consideration received by the Company will be the fair value of
such consideration, except where such consideration consists of publicly traded securities, in which case the amount of consideration
received by the Company for such securities will be the arithmetic average of the VWAPs of such security for each of the five (5) Trading
Days immediately preceding the date of receipt. If any shares of Common Stock, Options or Convertible Securities are issued to the owners
of the non-surviving entity in connection with any merger in which the Company is the surviving entity, the amount of consideration therefor
will be deemed to be the fair value of such portion of the net assets and business of the non-surviving entity as is attributable to
such shares of Common Stock, Options or Convertible Securities (as the case may be). The fair value of any consideration other than cash
or publicly traded securities will be determined jointly by the Company and the Required Holder. If such parties are unable to reach
agreement within ten (10) days after the occurrence of an event requiring valuation (the “Valuation Event”), the fair
value of such consideration will be determined within five (5) Trading Days after the tenth (10th) day following such Valuation Event
by an independent, reputable appraiser jointly selected by the Company and the Required Holder. The determination of such appraiser shall
be final and binding upon all parties absent manifest error and the fees and expenses of such appraiser shall be borne by the Company.
(v) Record Date.
If the Company takes a record of the holders of shares of Common Stock for the purpose of entitling them (A) to receive a dividend or
other distribution payable in shares of Common Stock, Options or in Convertible Securities or (B) to subscribe for or purchase shares
of Common Stock, Options or Convertible Securities, then such record date will be deemed to be the date of the issuance or sale of the
shares of Common Stock deemed to have been issued or sold upon the declaration of such dividend or the making of such other distribution
or the date of the granting of such right of subscription or purchase (as the case may be).
(c) Number of Warrant Shares.
Simultaneously with any adjustment to the Exercise Price pursuant to this Section 2(b) and/or Section 2(h) below, as applicable,
the number of Warrant Shares that may be purchased upon exercise of this Warrant shall be increased or decreased proportionately, so
that after such adjustment the aggregate Exercise Price payable hereunder for the adjusted number of Warrant Shares shall be the same
as the aggregate Exercise Price in effect immediately prior to such adjustment (without regard to any limitations on exercise contained
herein).
(d) [Intentionally Omotted].
(e) Other Events. In
the event that the Company (or any Subsidiary (as defined in the Securities Purchase Agreement)) shall take any action to which the provisions
hereof are not strictly applicable, or, if applicable, would not operate to protect the Holder from dilution or if any event occurs of
the type contemplated by the provisions of this Section 2 but not expressly provided for by such provisions (including, without limitation,
the granting of stock appreciation rights, phantom stock rights or other rights with equity features), then the Company’s board
of directors shall in good faith determine and implement an appropriate adjustment in the Exercise Price and the number of Warrant Shares
(if applicable) so as to protect the rights of the Holder, provided that no such adjustment pursuant to this Section 4(d) will increase
the Exercise Price or decrease the number of Warrant Shares as otherwise determined pursuant to this Section 2, provided further that
if the Holder does not accept such adjustments as appropriately protecting its interests hereunder against such dilution, then the Company’s
board of directors and the Holder shall agree, in good faith, upon an independent investment bank of nationally recognized standing to
make such appropriate adjustments, whose determination shall be final and binding absent manifest error and whose fees and expenses shall
be borne by the Company.
(f) Calculations. All
calculations under this Section 2 shall be made by rounding to the nearest cent or the nearest 1/100th of a share, as
applicable. The number of shares of Common Stock outstanding at any given time shall not include shares owned or held by or for the account
of the Company, and the disposition of any such shares shall be considered an issuance or sale of Common Stock.
(g) Voluntary Adjustment
By Company. Subject to the rules and regulations of the Principal Market, the Company may at any time during the term of this Warrant,
with the prior written consent of the Required Holders (as defined in the Securities Purchase Agreement), reduce the then current Exercise
Price to any amount and for any period of time deemed appropriate by the board of directors of the Company.
(h) Adjustments. If
on any of the ninetieth (90th) and one hundred and eightieth (180th), as applicable, calendar day after each of
(x) each date of occurrence of any Stock Combination Event and (y) the Applicable Date (as defined in the Securities Purchase Agreement)
(each, an “Adjustment Date”), the Exercise Price then in effect is greater than the greater of (A) the Floor Price
(as defined in the Certificate of Designations), and (B) the Market Price (as defined in the Certificate of Designations) then in effect
(the “Adjustment Price”), on the Adjustment Date the Exercise Price shall automatically lower to the Adjustment Price.
(i) Exercise Floor Price.
Prior to the Stockholder Approval Date (as defined in the Securities Purchase Agreement), no adjustment pursuant to this Section 2 shall
cause the Exercise Price to be less than $0.295 (as adjusted for any stock dividend, stock split, stock combination, reclassification
or similar transaction occurring after the date of the Securities Purchase Agreement) (the “Exercise Floor Price”).
As of the Stockholder Approval Date, any Dilutive Issuances or other events that would have resulted in an adjustment to the Exercise
Price prior to the Stockholder Approval Date, but for the application of this Section 2(i), shall adjust the Exercise Price hereunder
as if such Dilutive Issuances and/or other events, as applicable, occurred on the Stockholder Approval Date.
3. RIGHTS
UPON DISTRIBUTION OF ASSETS. In addition to any adjustments pursuant to Section 2 above or Section 4(a) below, 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, options, evidence of indebtedness or any other assets 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 or restrictions on exercise of this Warrant, including without limitation, the Maximum Percentage) immediately
before the date on 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 and the other Attribution Parties exceeding
the Maximum Percentage, then the Holder shall not be entitled to participate in such Distribution to the extent of the Maximum Percentage
(and shall not be entitled to beneficial ownership of such shares of Common Stock as a result of such Distribution (and beneficial ownership)
to the extent of any such excess) and the portion of such Distribution shall be held in abeyance for the benefit of the Holder until
such time or times, if ever, as its right thereto would not result in the Holder and the other Attribution Parties exceeding the Maximum
Percentage, at which time or times the Holder shall be granted such Distribution (and any Distributions declared or made on such initial
Distribution or on any subsequent Distribution held similarly in abeyance) to the same extent as if there had been no such limitation).
4. PURCHASE
RIGHTS; FUNDAMENTAL TRANSACTIONS.
(a) Purchase Rights.
In addition to any adjustments pursuant to Sections 2 or 3 above, if at any time the Company grants, issues or sells any Options,
Convertible Securities or rights to purchase stock, warrants, securities or other property pro rata to the record holders of any class
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 exercise of this Warrant (without regard to any limitations or restrictions on exercise of this
Warrant, including without limitation, the Maximum Percentage) 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, issuance 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 and the other Attribution Parties
exceeding the Maximum Percentage, then the Holder shall not be entitled to participate in such Purchase Right to the extent of the Maximum
Percentage (and shall not be entitled to beneficial ownership of such shares of Common Stock as a result of such Purchase Right (and
beneficial ownership) to the extent of any such excess) and such Purchase Right to such extent shall be held in abeyance for the benefit
of the Holder until such time or times, if ever, as its right thereto would not result in the Holder and the other Attribution Parties
exceeding the Maximum Percentage, at which time or times the Holder shall be granted such right (and any Purchase Right granted, issued
or sold on such initial Purchase Right or on any subsequent Purchase Right held similarly in abeyance) to the same extent as if there
had been no such limitation).
(b) Fundamental Transactions.
The Company shall not enter into or be party to a Fundamental Transaction unless (i) the Successor Entity assumes in writing all of the
obligations of the Company under this Warrant and the other Transaction Documents (as defined in the Securities Purchase Agreement) in
accordance with the provisions of this Section 4(b) pursuant to written agreements in form and substance satisfactory to the Holder
and approved by the Holder prior to such Fundamental Transaction, including agreements to 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,
including, without limitation, which is exercisable for a corresponding number of shares of capital stock 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 adjustments to the 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 (ii) the
Successor Entity (including its Parent Entity) is a publicly traded corporation whose common stock is quoted on or listed for trading
on an Eligible Market. Upon the consummation of each Fundamental Transaction, the Successor Entity shall succeed to, and be substituted
for (so that from and after the date of the applicable Fundamental Transaction, the provisions of this Warrant 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 Warrant and the other Transaction Documents with the
same effect as if such Successor Entity had been named as the Company herein. Upon consummation of each Fundamental Transaction, the
Successor Entity shall deliver to the Holder confirmation that there shall be issued upon exercise of this Warrant at any time after
the consummation of the applicable Fundamental Transaction, in lieu of the shares of Common Stock (or other securities, cash, assets
or other property (except such items still issuable under Sections 3 and 4(a) above, which shall continue to be receivable thereafter))
issuable upon the exercise of this Warrant prior to the applicable Fundamental Transaction, such shares of publicly traded common stock
(or its equivalent) of the Successor Entity (including its Parent Entity) which the Holder would have been entitled to receive upon the
happening of the applicable Fundamental Transaction had this Warrant been exercised immediately prior to the applicable Fundamental Transaction
(without regard to any limitations on the exercise of this Warrant), as adjusted in accordance with the provisions of this Warrant. Notwithstanding
the foregoing, and without limiting Section 1(f) hereof, the Holder may elect, at its sole option, by delivery of written notice to the
Company to waive this Section 4(b) to permit the Fundamental Transaction without the assumption of this Warrant. In addition to
and not in substitution for any other rights hereunder, prior to the consummation of each Fundamental Transaction pursuant to which holders
of shares of Common Stock are entitled to receive securities or other assets with respect to or in exchange for shares of Common Stock
(a “Corporate Event”), the Company shall make appropriate provision to insure that the Holder will thereafter have
the right to receive upon an exercise of this Warrant at any time after the consummation of the applicable Fundamental Transaction but
prior to the Expiration Date, in lieu of the shares of the Common Stock (or other securities, cash, assets or other property (except
such items still issuable under Sections 3 and 4(a) above, which shall continue to be receivable thereafter)) issuable upon the
exercise of the Warrant prior to such Fundamental Transaction, such shares of stock, securities, cash, assets or any other property whatsoever
(including warrants or other purchase or subscription rights) which the Holder would have been entitled to receive upon the happening
of the applicable Fundamental Transaction had this Warrant been exercised immediately prior to the applicable Fundamental Transaction
(without regard to any limitations on the exercise of this Warrant). Provision made pursuant to the preceding sentence shall be in a
form and substance reasonably satisfactory to the Holder.
(c) Black Scholes Value;
Fundamental Transaction Redemption. Notwithstanding the foregoing and the provisions of Section 4(b) above, at the request of
the Holder delivered at any time commencing on the earliest to occur of (x) the public disclosure of any Fundamental Transaction, (y)
the consummation of any Fundamental Transaction and (z) the Holder first becoming aware of any Fundamental Transaction through the date
that is ninety (90) days after the public disclosure of the consummation of such Fundamental Transaction by the Company pursuant to a
Current Report on Form 8-K filed with the SEC, the Company or the Successor Entity (as the case may be) shall purchase this Warrant from
the Holder on the date of such request by paying to the Holder cash in an amount equal to the Black Scholes Value. Payment of such amounts
shall be made by the Company (or at the Company’s direction) to the Holder on or prior to the later of (x) the second (2nd)
Trading Day after the date of such request and (y) the date of consummation of such Fundamental Transaction; provided, however, that
the provisions of this Section 4(c) shall not apply to any Fundamental Transactions that have been publicly announced as of the date
hereof, including but not limited to, the transactions contemplated by the Merger Agreement.
(d) Application. The
provisions of this Section 4 shall apply similarly and equally to successive Fundamental Transactions and Corporate Events and shall
be applied as if this Warrant (and any such subsequent warrants) were fully exercisable and without regard to any limitations on the
exercise of this Warrant (provided that the Holder shall continue to be entitled to the benefit of the Maximum Percentage, applied however
with respect to shares of capital stock registered under the 1934 Act and thereafter receivable upon exercise of this Warrant (or any
such other warrant)).
5. NONCIRCUMVENTION.
The Company hereby covenants and agrees that the Company will not, by amendment of its Certificate of Incorporation (as defined in the
Securities Purchase Agreement), Bylaws (as defined in the Securities Purchase Agreement) or through any reorganization, transfer of assets,
consolidation, merger, scheme of arrangement, dissolution, issuance 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, and will at all times in good faith carry out all the provisions
of this Warrant and take all action as may be required to protect the rights of the Holder. Without limiting the generality of the foregoing,
the Company (a) shall not increase the par value of any shares of Common Stock receivable upon the exercise of this Warrant above the
Exercise Price then in effect, and (b) shall take all such actions as may be necessary or appropriate in order that the Company may validly
and legally issue fully paid and non-assessable shares of Common Stock upon the exercise of this Warrant. Notwithstanding anything herein
to the contrary, if after the sixty (60) calendar day anniversary of the Issuance Date, the Holder is not permitted to exercise this
Warrant in full for any reason (other than pursuant to restrictions set forth in Section 1(f) hereof), the Company shall use its best
efforts to promptly remedy such failure, including, without limitation, obtaining such consents or approvals as necessary to permit such
exercise into shares of Common Stock.
6. WARRANT
HOLDER NOT DEEMED A STOCKHOLDER. Except as otherwise specifically provided herein, the Holder, solely in its capacity as a holder
of this Warrant, shall not be entitled to vote or receive dividends or be deemed the holder of share capital of the Company for any purpose,
nor shall anything contained in this Warrant be construed to confer upon the Holder, solely in its capacity as the Holder of this Warrant,
any of the rights of a stockholder of the Company or any right to vote, give or withhold consent to any corporate action (whether any
reorganization, issue of stock, reclassification of stock, consolidation, merger, conveyance or otherwise), receive notice of meetings,
receive dividends or subscription rights, or otherwise, prior to the issuance to the Holder of the Warrant Shares which it is then entitled
to receive upon the due exercise of this Warrant. In addition, nothing contained in this Warrant shall be construed as imposing any liabilities
on the Holder to purchase any securities (upon exercise of this Warrant or otherwise) or as a stockholder of the Company, whether such
liabilities are asserted by the Company or by creditors of the Company. Notwithstanding this Section 6, the Company shall provide
the Holder with copies of the same notices and other information given to the stockholders of the Company generally, contemporaneously
with the giving thereof to the stockholders.
7. REISSUANCE
OF WARRANTS.
(a) Transfer of Warrant.
If this Warrant is to be transferred, the Holder shall surrender this Warrant to the Company, whereupon the Company will forthwith issue
and deliver upon the order of the Holder a new Warrant (in accordance with Section 7(d)), registered as the Holder may request,
representing the right to purchase the number of Warrant Shares being transferred by the Holder and, if less than the total number of
Warrant Shares then underlying this Warrant is being transferred, a new Warrant (in accordance with Section 7(d)) to the Holder
representing the right to purchase the number of Warrant Shares not being transferred.
(b) Lost, Stolen or Mutilated
Warrant. Upon receipt by the Company of evidence reasonably satisfactory to the Company of the loss, theft, destruction or mutilation
of this Warrant (as to which a written certification and the indemnification contemplated below shall suffice as such evidence), and,
in the case of loss, theft or destruction, of any indemnification undertaking by the Holder to the Company in customary and reasonable
form and, in the case of mutilation, upon surrender and cancellation of this Warrant, the Company shall execute and deliver to the Holder
a new Warrant (in accordance with Section 7(d)) representing the right to purchase the Warrant Shares then underlying this Warrant.
(c) Exchangeable for Multiple
Warrants. This Warrant is exchangeable, upon the surrender hereof by the Holder at the principal office of the Company, for a new
Warrant or Warrants (in accordance with Section 7(d)) representing in the aggregate the right to purchase the number of Warrant
Shares then underlying this Warrant, and each such new Warrant will represent the right to purchase such portion of such Warrant Shares
as is designated by the Holder at the time of such surrender; provided, however, no warrants for fractional shares of Common Stock shall
be given.
(d) Issuance of New Warrants.
Whenever the Company is required to issue a new Warrant pursuant to the terms of this Warrant, such new Warrant (i) shall be of like
tenor with this Warrant, (ii) shall represent, as indicated on the face of such new Warrant, the right to purchase the Warrant Shares
then underlying this Warrant (or in the case of a new Warrant being issued pursuant to Section 7(a) or Section 7(c), the Warrant
Shares designated by the Holder which, when added to the number of shares of Common Stock underlying the other new Warrants issued in
connection with such issuance, does not exceed the number of Warrant Shares then underlying this Warrant), (iii) shall have an issuance
date, as indicated on the face of such new Warrant which is the same as the Issuance Date, and (iv) shall have the same rights and conditions
as this Warrant.
8. NOTICES.
Whenever notice is required to be given under this Warrant, unless otherwise provided herein, such notice shall be given in accordance
with Section 9(f) of the Securities Purchase Agreement. The Company shall provide the Holder with prompt written notice of all actions
taken pursuant to this Warrant (other than the issuance of shares of Common Stock upon exercise in accordance with the terms hereof),
including in reasonable detail a description of such action and the reason therefor. Without limiting the generality of the foregoing,
the Company will give written notice to the Holder (i) immediately upon each adjustment of the Exercise Price and the number of Warrant
Shares, setting forth in reasonable detail, and certifying, the calculation of such adjustment(s), and (ii) at least fifteen (15) days
prior to the date on which the Company closes its books or takes a record (A) with respect to any dividend or distribution upon the shares
of Common Stock, (B) with respect to any grants, issuances or sales of any Options, Convertible Securities or rights to purchase stock,
warrants, securities or other property to holders of shares of Common Stock or (C) for determining rights to vote with respect to any
Fundamental Transaction, dissolution or liquidation, provided in each case that such information shall be made known to the public prior
to or in conjunction with such notice being provided to the Holder. To the extent that any notice provided hereunder constitutes, or
contains, material, non-public information regarding the Company or any of its Subsidiaries, the Company shall simultaneously file such
notice with the SEC (as defined in the Securities Purchase Agreement) pursuant to a Current Report on Form 8-K. If the Company or any
of its Subsidiaries provides material non-public information to the Holder that is not simultaneously filed in a Current Report on Form
8-K and the Holder has not agreed to receive such material non-public information, the Company hereby covenants and agrees that the Holder
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 with respect to, or a duty to any of the foregoing not to trade on the basis of, such material non-public information.
It is expressly understood and agreed that the time of execution specified by the Holder in each Exercise Notice shall be definitive
and may not be disputed or challenged by the Company.
9. DISCLOSURE.
Upon delivery by the Company to the Holder (or receipt by the Company from the Holder) of any notice in accordance with the terms of
this Warrant, unless the Company has in good faith determined that the matters relating to such notice do not constitute material, non-public
information relating to the Company or any of its Subsidiaries, the Company shall on or prior to 9:00 am, New York city time on the Business
Day immediately following such notice delivery date, publicly disclose such material, non-public 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 any of its Subsidiaries, the Company so shall indicate to the Holder explicitly in writing in such notice (or immediately upon receipt
of notice from the Holder, as applicable), and in the absence of any such written indication in such notice (or notification from the
Company immediately upon receipt of notice from the Holder), the Holder shall be entitled to presume that information contained in the
notice does not constitute material, non-public information relating to the Company or any of its Subsidiaries. Nothing contained in
this Section 9 shall limit any obligations of the Company, or any rights of the Holder, under Section 4(i) of the Securities Purchase
Agreement.
10. ABSENCE
OF TRADING AND DISCLOSURE RESTRICTIONS. The Company acknowledges and agrees that the Holder is not a fiduciary or agent of the Company
and that the Holder shall have no obligation to (a) maintain the confidentiality of any information provided by the Company or (b) refrain
from trading any securities while in possession of such information in the absence of a written non-disclosure agreement signed by an
officer of the Holder that explicitly provides for such confidentiality and trading restrictions. In the absence of such an executed,
written non-disclosure agreement, the Company acknowledges that the Holder may freely trade in any securities issued by the Company,
may possess and use any information provided by the Company in connection with such trading activity, and may disclose any such information
to any third party.
11. AMENDMENT
AND WAIVER. Except as otherwise provided herein, the provisions of this Warrant (other than Section 1(f)) may be amended and
the Company may take any action herein prohibited, or omit to perform any act herein required to be performed by it, only if the Company
has obtained the written consent of the Holder. No waiver shall be effective unless it is in writing and signed by an authorized representative
of the waiving party.
12. SEVERABILITY.
If any provision of this Warrant is prohibited by law or otherwise determined to be invalid or unenforceable by a court of competent
jurisdiction, the provision that would otherwise be prohibited, invalid or unenforceable shall be deemed amended to apply to the broadest
extent that it would be valid and enforceable, and the invalidity or unenforceability of such provision shall not affect the validity
of the remaining provisions of this Warrant so long as this Warrant as so modified continues to express, without material change, the
original intentions of the parties as to the subject matter hereof and the prohibited nature, invalidity or unenforceability of the provision(s)
in question does not substantially impair the respective expectations or reciprocal obligations of the parties or the practical realization
of the benefits that would otherwise be conferred upon the parties. The parties will endeavor in good faith negotiations to replace the
prohibited, invalid or unenforceable provision(s) with a valid provision(s), the effect of which comes as close as possible to that of
the prohibited, invalid or unenforceable provision(s).
13. GOVERNING
LAW. This Warrant shall be governed by and construed and enforced in accordance with, and all questions concerning the construction,
validity, interpretation and performance of this Warrant shall be governed by, the internal laws of the State of New York, without giving
effect to any provision or rule (whether of the State of New York or any other jurisdictions) that would cause the application of the
laws of any jurisdictions other than the State of New York. The Company hereby irrevocably waives personal service of process and consents
to process being served in any such suit, action or proceeding by mailing a copy thereof to the Company at the address set forth in Section
9(f) of the Securities Purchase Agreement and agrees that such service shall constitute good and sufficient service of process and notice
thereof. The Company hereby irrevocably submits to the exclusive jurisdiction of the state and federal courts sitting in The City of
New York, Borough of Manhattan, for the adjudication of any dispute hereunder or in connection herewith or with any transaction contemplated
hereby or discussed herein, and hereby irrevocably waives, and agrees not to assert in any suit, action or proceeding, any claim that
it is not personally subject to the jurisdiction of any such court, that such suit, action or proceeding is brought in an inconvenient
forum or that the venue of such suit, action or proceeding is improper. Nothing contained herein shall be deemed to limit in any way
any right to serve process in any manner permitted by law. Nothing contained herein shall be deemed or operate to preclude the Holder
from bringing suit or taking other legal action against the Company in any other jurisdiction to collect on the Company’s obligations
to the Holder, to realize on any collateral or any other security for such obligations, or to enforce a judgment or other court ruling
in favor of the Holder. THE COMPANY HEREBY IRREVOCABLY WAIVES ANY RIGHT IT MAY HAVE TO, AND AGREES NOT TO REQUEST, A JURY TRIAL FOR
THE ADJUDICATION OF ANY DISPUTE HEREUNDER OR IN CONNECTION WITH OR ARISING OUT OF THIS WARRANT OR ANY TRANSACTION CONTEMPLATED HEREBY.
14. CONSTRUCTION;
HEADINGS. This Warrant shall be deemed to be jointly drafted by the Company and the Holder and shall not be construed against any
Person as the drafter hereof. The headings of this Warrant are for convenience of reference and shall not form part of, or affect the
interpretation of, this Warrant. Terms used in this Warrant but defined in the other Transaction Documents shall have the meanings ascribed
to such terms on the Closing Date (as defined in the Securities Purchase Agreement) in such other Transaction Documents unless otherwise
consented to in writing by the Holder.
15. DISPUTE
RESOLUTION.
(a) Submission to Dispute
Resolution.
(i)
In the case of a dispute relating to the Exercise Price, the Closing Sale Price, the Bid Price, Black Scholes Value or fair market
value or the arithmetic calculation of the number of Warrant Shares (as the case may be) (including, without limitation, a dispute relating
to the determination of any of the foregoing), the Company or the Holder (as the case may be) shall submit the dispute to the other party
via facsimile (A) if by the Company, within two (2) Business Days after the occurrence of the circumstances giving rise to such dispute
or (B) if by the Holder, at any time after the Holder learned of the circumstances giving rise to such dispute. If the Holder and the
Company are unable to promptly resolve such dispute relating to such Exercise Price, such Closing Sale Price, such Bid Price, Black Scholes
Value or such fair market value or such arithmetic calculation of the number of Warrant Shares (as the case may be), at any time after
the second (2nd) Business Day following such initial notice by the Company or the Holder (as the case may be) of such dispute
to the Company or the Holder (as the case may be), then the Holder may, at its sole option, select an independent, reputable investment
bank to resolve such dispute.
(ii)
The Holder and the Company shall each deliver to such investment bank (A) a copy of the initial dispute submission so delivered
in accordance with the first sentence of this Section 15 and (B) written documentation supporting its position with respect to such
dispute, in each case, no later than 5:00 p.m. (New York time) by the fifth (5th) Business Day immediately following the date
on which the Holder selected such investment bank (the “Dispute Submission Deadline”) (the documents referred to in
the immediately preceding clauses (A) and (B) are collectively referred to herein as the “Required Dispute Documentation”)
(it being understood and agreed that if either the Holder or the Company fails to so deliver all of the Required Dispute Documentation
by the Dispute Submission Deadline, then the party who fails to so submit all of the Required Dispute Documentation shall no longer be
entitled to (and hereby waives its right to) deliver or submit any written documentation or other support to such investment bank with
respect to such dispute and such investment bank shall resolve such dispute based solely on the Required Dispute Documentation that was
delivered to such investment bank prior to the Dispute Submission Deadline). Unless otherwise agreed to in writing by both the Company
and the Holder or otherwise requested by such investment bank, neither the Company nor the Holder shall be entitled to deliver or submit
any written documentation or other support to such investment bank in connection with such dispute (other than the Required Dispute Documentation).
(iii)
The Company and the Holder shall cause such investment bank to determine the resolution of such dispute and notify the Company
and the Holder of such resolution no later than ten (10) Business Days immediately following the Dispute Submission Deadline. The fees
and expenses of such investment bank shall be borne solely by the Company, and such investment bank’s resolution of such dispute
shall be final and binding upon all parties absent manifest error.
(b) Miscellaneous.
The Company expressly acknowledges and agrees that (i) this Section 15 constitutes an agreement to arbitrate between the Company
and the Holder (and constitutes an arbitration agreement) under the rules then in effect § 7501, et seq. of the New York Civil Practice
Law and Rules (“CPLR”) and that the Holder is authorized to apply for an order to compel arbitration pursuant to CPLR
§ 7503(a) in order to compel compliance with this Section 15, (ii) a dispute relating to the Exercise Price includes, without
limitation, disputes as to (A) whether an issuance or sale or deemed issuance or sale of Common Stock occurred under Section 2(b), (B)
the consideration per share at which an issuance or deemed issuance of Common Stock occurred, (C) whether any issuance or sale or deemed
issuance or sale of Common Stock was an issuance or sale or deemed issuance or sale of Excluded Securities, (D) whether an agreement,
instrument, security or the like constitutes and Option or Convertible Security and (E) whether a Dilutive Issuance occurred, (iii) the
terms of this Warrant and each other applicable Transaction Document shall serve as the basis for the selected investment bank’s
resolution of the applicable dispute, such investment bank shall be entitled (and is hereby expressly authorized) to make all findings,
determinations and the like that such investment bank determines are required to be made by such investment bank in connection with its
resolution of such dispute (including, without limitation, determining (A) whether an issuance or sale or deemed issuance or sale of
Common Stock occurred under Section 2(b), (B) the consideration per share at which an issuance or deemed issuance of Common Stock occurred,
(C) whether any issuance or sale or deemed issuance or sale of Common Stock was an issuance or sale or deemed issuance or sale of Excluded
Securities, (D) whether an agreement, instrument, security or the like constitutes and Option or Convertible Security and (E) whether
a Dilutive Issuance occurred) and in resolving such dispute such investment bank shall apply such findings, determinations and the like
to the terms of this Warrant and any other applicable Transaction Documents, (iv) the Holder (and only the Holder), in its sole discretion,
shall have the right to submit any dispute described in this Section 15 to any state or federal court sitting in The City of New
York, Borough of Manhattan in lieu of utilizing the procedures set forth in this Section 15 and (v) nothing in this Section 15
shall limit the Holder from obtaining any injunctive relief or other equitable remedies (including, without limitation, with respect
to any matters described in this Section 15).
16. REMEDIES,
CHARACTERIZATION, OTHER OBLIGATIONS, BREACHES AND INJUNCTIVE RELIEF. The remedies provided in this Warrant shall be cumulative and
in addition to all other remedies available under this Warrant and 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 right of the Holder to pursue actual
and consequential damages for any failure by the Company to comply with the terms of this Warrant. 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, exercises 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 of this Warrant shall be entitled, in addition to all other available remedies, to specific performance and/or temporary,
preliminary and permanent injunctive or other equitable relief from any court of competent jurisdiction in any such case without the
necessity of proving actual damages and without posting a bond or other security. 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 Warrant (including, without limitation, compliance with Section 2 hereof). The issuance of shares and certificates for shares
as contemplated hereby upon the exercise of this Warrant shall be made without charge to the Holder or such shares for any issuance tax
or other costs in respect thereof, provided that the Company shall not be required to pay any tax which may be payable in respect of
any transfer involved in the issuance and delivery of any certificate in a name other than the Holder or its agent on its behalf.
17. PAYMENT
OF COLLECTION, ENFORCEMENT AND OTHER COSTS. If (a) this Warrant is placed in the hands of an attorney
for collection or enforcement or is collected or enforced through any legal proceeding or the holder otherwise takes action to collect
amounts due under this Warrant or to enforce the provisions of this Warrant or (b) there occurs any bankruptcy, reorganization, receivership
of the company or other proceedings affecting company creditors’ rights and involving a claim under this Warrant, then the Company
shall pay the costs incurred by the Holder for such collection, enforcement or action or in connection with such bankruptcy, reorganization,
receivership or other proceeding, including, without limitation, attorneys’ fees and disbursements.
18. TRANSFER.
This Warrant may be offered for sale, sold, transferred or assigned without the consent of the Company, except as may otherwise be required
by Section 2(g) of the Securities Purchase Agreement.
19. CERTAIN
DEFINITIONS. For purposes of this Warrant, the following terms shall have the following meanings:
(a)
“1933 Act” means the Securities Act of 1933, as amended, and the rules and regulations thereunder.
(b)
“1934 Act” means the Securities Exchange Act of 1934, as amended, and the rules and regulations thereunder.
(c)
“Adjustment Measurement Commencement Date” means January 1, 2023.
(d)
“Adjustment Right” means any right granted with respect to any securities issued in connection with, or with
respect to, any issuance or sale (or deemed issuance or sale in accordance with Section 2) of shares of Common Stock (other than
rights of the type described in Section 3 and 4 hereof) that could result in a decrease in the net consideration received by the
Company in connection with, or with respect to, such securities (including, without limitation, any cash settlement rights, cash adjustment
or other similar rights).
(e)
“Affiliate” means, with respect to any Person, any other Person that directly or indirectly controls, is controlled
by, or is under common control with, such Person, it being understood for purposes of this definition that “control” of a
Person means the power directly or indirectly either to vote 10% or more of the stock having ordinary voting power for the election of
directors of such Person or direct or cause the direction of the management and policies of such Person whether by contract or otherwise.
(f)
“Applicable Date” means the later of (x) the Stockholder Approval Date and (y) the earlier to occur of (A)
the effective date of a registration statement registering the resale by the Holders of all of the Registrable Securities and (B) the
date the Registrable Securities are eligible to be resold by the Holders (assuming such Holders are not then affiliates of the Company)
without restriction under Rule 144 of the 1933 Act (in each case, without regard to any limitations on exercise herein).
(g)
“Approved Stock Plan” means any employee benefit plan which has been approved by the board of directors of
the Company prior to or subsequent to the date hereof pursuant to which shares of Common Stock and standard options to purchase Common
Stock may be issued to any employee, officer or director for services provided to the Company in their capacity as such.
(h)
“Attribution Parties” means, collectively, the following Persons and entities: (i) any investment vehicle, including,
any funds, feeder funds or managed accounts, currently, or from time to time after the Issuance Date, directly or indirectly managed or
advised by the Holder’s investment manager or any of its Affiliates or principals, (ii) any direct or indirect Affiliates of the
Holder or any of the foregoing, (iii) any Person acting or who could be deemed to be acting as a Group together with the Holder or any
of the foregoing and (iv) any other Persons whose beneficial ownership of the Company’s Common Stock would or could be aggregated
with the Holder’s and the other Attribution Parties for purposes of Section 13(d) of the 1934 Act. For clarity, the purpose of the
foregoing is to subject collectively the Holder and all other Attribution Parties to the Maximum Percentage.
(i)
“Bid Price” means, for any security as of the particular time of determination, the bid price for such security
on the Principal Market as reported by Bloomberg as of such time of determination, or, if the Principal Market is not the principal securities
exchange or trading market for such security, the bid price of such security on the principal securities exchange or trading market where
such security is listed or traded as reported by Bloomberg as of such time of determination, or if the foregoing does not apply, the bid
price of such security in the over-the-counter market on the electronic bulletin board for such security as reported by Bloomberg as of
such time of determination, or, if no bid price is reported for such security by Bloomberg as of such time of determination, the average
of the bid prices of any market makers for such security as reported in The Pink Open Market (or a similar organization or agency succeeding
to its functions of reporting prices) as of such time of determination. If the Bid Price cannot be calculated for a security as of the
particular time of determination on any of the foregoing bases, the Bid Price of such security as of such time of determination shall
be the fair market value as mutually determined by the Company and the Holder. If the Company and the Holder are unable to agree upon
the fair market value of such security, then such dispute shall be resolved in accordance with the procedures in Section 15. All
such determinations shall be appropriately adjusted for any stock dividend, stock split, stock combination or other similar transaction
during such period.
(j)
“Black Scholes Value” means the value of the unexercised portion of this Warrant remaining on the date of the
Holder’s request pursuant to Section 4(c), which value is calculated using the Black Scholes Option Pricing Model obtained
from the “OV” function on Bloomberg utilizing (i) an underlying price per share equal to the greater of (1) the highest Closing
Sale Price of the Common Stock during the period beginning on the Trading Day immediately preceding the announcement of the applicable
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 Section 4(c) and (2) the sum of the price per share being offered in cash in the applicable Fundamental
Transaction (if any) plus the value of the non-cash consideration being offered in the applicable Fundamental Transaction (if any), (ii)
a strike price equal to the Exercise Price in effect on the date of the Holder’s request pursuant to Section 4(c), (iii) a
risk-free interest rate corresponding to the U.S. Treasury rate for a period equal to the greater of (1) the remaining term of this Warrant
as of the date of the Holder’s request pursuant to Section 4(c) and (2) the remaining term of this Warrant as of the date of
consummation of the applicable Fundamental Transaction or as of the date of the Holder’s request pursuant to Section 4(c) if
such request is prior to the date of the consummation of the applicable Fundamental Transaction, (iv) a zero cost of borrow and (v) an
expected volatility equal to the greater of 100% and the 30 day volatility obtained from the “HVT” function on Bloomberg (determined
utilizing a 365 day annualization factor) as of the Trading Day immediately following the earliest to occur of (A) the public disclosure
of the applicable Fundamental Transaction and (B) the date of the Holder’s request pursuant to Section 4(c).
(k)
“Bloomberg” means Bloomberg, L.P.
(l)
“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 generally are open for use by customers on such day.
(m)
“Closing Sale Price” means, for any security as of any date, the last closing trade price for such security
on the Principal Market, as reported by Bloomberg, or, if the Principal Market begins to operate on an extended hours basis and does not
designate the closing trade price, then the last trade price of such security prior to 4:00:00 p.m., New York time, as reported by Bloomberg,
or, if the Principal Market is not the principal securities exchange or trading market for such security, the last trade price of such
security on the principal securities exchange or trading market where such security is listed or traded as reported by Bloomberg, or if
the foregoing does not apply, the last trade price of such security in the over-the-counter market on the electronic bulletin board for
such security as reported by Bloomberg, or, if no last trade price is reported for such security by Bloomberg, the average of the ask
prices of any market makers for such security as reported in The Pink Open Market (or a similar organization or agency succeeding to its
functions of reporting prices). If the Closing Sale Price cannot be calculated for a security on a particular date on any of the foregoing
bases, the Closing Sale Price of such security on such date shall be the fair market value as mutually determined by the Company and the
Holder. If the Company and the Holder are unable to agree upon the fair market value of such security, then such dispute shall be resolved
in accordance with the procedures in Section 15. All such determinations shall be appropriately adjusted for any stock dividend,
stock split, stock combination or other similar transaction during such period.
(n)
“Common Stock” means (i) the Company’s shares of common stock, $0.0001 par value per share, and (ii)
any capital stock into which such common stock shall have been changed or any share capital resulting from a reclassification of such
common stock.
(o)
“Convertible Securities” means any stock or other security (other than Options) that is at any time and under
any circumstances, directly or indirectly, convertible into, exercisable or exchangeable for, or which otherwise entitles the holder thereof
to acquire, any shares of Common Stock.
(p)
“Eligible Market” means The New York Stock Exchange, the NYSE American, the Nasdaq Global Select Market, the
Nasdaq Global Market, the Nasdaq Capital Market or the Principal Market.
(q)
[Intentionally omitted]
(r)
[Intentionally omitted]
(s)
“Excluded Securities” means (i) shares of Common Stock or standard options to purchase Common Stock issued to
directors, officers or employees of the Company for services rendered to the Company in their capacity as such pursuant to an Approved
Stock Plan (as defined above), provided that (A) all such issuances (taking into account the shares of Common Stock issuable upon exercise
of such options) after the Subscription Date pursuant to this clause (i) do not either (x) with respect to any issuances during the period
commencing on the Issuance Date through December 31, 2024 and/or (y) with respect to any issuances in any given calendar year thereafter,
as applicable, exceed 10% of the Common Stock issued and outstanding as of the first calendar day in such period and/or calendar year,
as applicable, and (B) the exercise price of any such options is not lowered, none of such options are amended to increase the number
of shares issuable thereunder and none of the terms or conditions of any such options are otherwise materially changed in any manner that
adversely affects any of the Buyers; (ii) shares of Common Stock issued upon the conversion or exercise of Convertible Securities (other
than standard options to purchase Common Stock issued pursuant to an Approved Stock Plan that are covered by clause (i) above) issued
prior to the Adjustment Measurement Commencement Date, provided that the conversion price of any such Convertible Securities (other than
standard options to purchase Common Stock issued pursuant to an Approved Stock Plan that are covered by clause (i) above) is not lowered,
none of such Convertible Securities (other than standard options to purchase Common Stock issued pursuant to an Approved Stock Plan that
are covered by clause (i) above) are amended to increase the number of shares issuable thereunder and none of the terms or conditions
of any such Convertible Securities (other than standard options to purchase Common Stock issued pursuant to an Approved Stock Plan that
are covered by clause (i) above) are otherwise materially changed in any manner that adversely affects any of the Buyers; and (iii) the
shares of Common Stock issuable upon exercise of the SPA Warrants; provided, that the terms of the SPA Warrant are not amended, modified
or changed on or after the Subscription Date (other than antidilution adjustments pursuant to the terms thereof in effect as of the Subscription
Date).
(t)
“Expiration Date” means the date that is the fifth (5th) anniversary of the Initial Exercisability
Date or, if such date falls on a day other than a Trading Day or on which trading does not take place on the Principal Market (a “Holiday”),
the next date that is not a Holiday.
(u)
“Fundamental Transaction” means (A) that the Company shall, directly or indirectly, including through subsidiaries,
Affiliates or otherwise, in one or more related transactions, (i) consolidate or merge with or into (whether or not the Company is the
surviving corporation) another Subject Entity, or (ii) sell, assign, transfer, convey or otherwise dispose of all or substantially all
of the properties or assets of the Company or any of its “significant subsidiaries” (as defined in Rule 1-02 of Regulation
S-X) to one or more Subject Entities, or (iii) make, or allow one or more Subject Entities to make, or allow the Company to be subject
to or have its Common Stock be subject to or party to one or more Subject Entities making, a purchase, tender or exchange offer that is
accepted by the holders of at least either (x) 50% of the outstanding shares of Common Stock, (y) 50% of the outstanding shares of Common
Stock calculated as if any shares of Common Stock held by all Subject Entities making or party to, or Affiliated with any Subject Entities
making or party to, such purchase, tender or exchange offer were not outstanding; or (z) such number of shares of Common Stock such that
all Subject Entities making or party to, or Affiliated with any Subject Entity making or party to, such purchase, tender or exchange offer,
become collectively the beneficial owners (as defined in Rule 13d-3 under the 1934 Act) of at least 50% of the outstanding shares of Common
Stock, or (iv) consummate a stock or share purchase agreement or other business combination (including, without limitation, a reorganization,
recapitalization, spin-off or scheme of arrangement) with one or more Subject Entities whereby all such Subject Entities, individually
or in the aggregate, acquire, either (x) at least 50% of the outstanding shares of Common Stock, (y) at least 50% of the outstanding shares
of Common Stock calculated as if any shares of Common Stock held by all the Subject Entities making or party to, or Affiliated with any
Subject Entity making or party to, such stock purchase agreement or other business combination were not outstanding; or (z) such number
of shares of Common Stock such that the Subject Entities become collectively the beneficial owners (as defined in Rule 13d-3 under the
1934 Act) of at least 50% of the outstanding shares of Common Stock, or (v) reorganize, recapitalize or reclassify its Common Stock, (B)
that the Company shall, directly or indirectly, including through subsidiaries, Affiliates or otherwise, in one or more related transactions,
allow any Subject Entity individually or the Subject Entities in the aggregate to be or become the “beneficial owner” (as
defined in Rule 13d-3 under the 1934 Act), directly or indirectly, whether through acquisition, purchase, assignment, conveyance, tender,
tender offer, exchange, reduction in outstanding shares of Common Stock, merger, consolidation, business combination, reorganization,
recapitalization, spin-off, scheme of arrangement, reorganization, recapitalization or reclassification or otherwise in any manner whatsoever,
of either (x) at least 50% of the aggregate ordinary voting power represented by issued and outstanding Common Stock, (y) at least 50%
of the aggregate ordinary voting power represented by issued and outstanding Common Stock not held by all such Subject Entities as of
the date of this Warrant calculated as if any shares of Common Stock held by all such Subject Entities were not outstanding, or (z) a
percentage of the aggregate ordinary voting power represented by issued and outstanding shares of Common Stock or other equity securities
of the Company sufficient to allow such Subject Entities to effect a statutory short form merger or other transaction requiring other
shareholders of the Company to surrender their shares of Common Stock without approval of the shareholders of the Company or (C) directly
or indirectly, including through subsidiaries, Affiliates or otherwise, in one or more related transactions, the issuance of or the entering
into any other instrument or transaction structured in a manner to circumvent, or that circumvents, the intent of this definition in which
case this definition shall be construed and implemented in a manner otherwise than in strict conformity with the terms of this definition
to the extent necessary to correct this definition or any portion of this definition which may be defective or inconsistent with the intended
treatment of such instrument or transaction.
(v)
“Group” means a “group” as that term is used in Section 13(d) of the 1934 Act and as defined in
Rule 13d-5 thereunder.
(w)
“Options” means any rights, warrants or options to subscribe for or purchase shares of Common Stock or Convertible
Securities.
(x)
“Parent Entity” of a Person means an entity that, directly or indirectly, controls the applicable Person and
whose common stock or equivalent equity security is quoted or listed on an Eligible Market, or, if there is more than one such Person
or Parent Entity, the Person or Parent Entity with the largest public market capitalization as of the date of consummation of the Fundamental
Transaction.
(y)
“Person” means an individual, a limited liability company, a partnership, a joint venture, a corporation, a
trust, an unincorporated organization, any other entity or a government or any department or agency thereof.
(z)
“Principal Market” means the Nasdaq Capital Market.
(aa)
Reserved.
(bb)
“SEC” means the United States Securities and Exchange Commission or the successor thereto.
(cc)
“Stock Combination Event” means the occurrence at any time and from time to time on or after the Subscription
Date of any stock split, stock dividend, stock combination recapitalization or other similar transaction involving the Common Stock.
(dd)
“Subject Entity” means any Person, Persons or Group or any Affiliate or associate of any such Person, Persons
or Group.
(ee)
“Successor Entity” means the Person (or, if so elected by the Holder, the Parent Entity) formed by, resulting
from or surviving any Fundamental Transaction or the Person (or, if so elected by the Holder, the Parent Entity) with which such Fundamental
Transaction shall have been entered into.
(ff)
“Trading Day” means, as applicable, (x) with respect to all price or trading volume determinations relating
to the Common Stock, any day on which the Common Stock is traded on the Principal Market, or, if the Principal Market is not the principal
trading market for the Common Stock, then on the principal securities exchange or securities market on which the Common Stock is then
traded, provided that “Trading Day” shall not include any day on which the Common Stock is scheduled to trade on such exchange
or market for less than 4.5 hours or any day that the Common Stock is suspended from trading during the final hour of trading on such
exchange or market (or if such exchange or market does not designate in advance the closing time of trading on such exchange or market,
then during the hour ending at 4:00:00 p.m., New York time) unless such day is otherwise designated as a Trading Day in writing by the
Holder or (y) with respect to all determinations other than price or trading volume determinations relating to the Common Stock, any day
on which The New York Stock Exchange (or any successor thereto) is open for trading of securities.
(gg)
“VWAP” means, for any security as of any date, the dollar volume-weighted average price for such security on
the Principal Market (or, if the Principal Market is not the principal trading market for such security, then on the principal securities
exchange or securities market on which such security is then traded), during the period beginning at 9:30 a.m., New York time, and ending
at 4:00 p.m., New York time, as reported by Bloomberg through its “VAP” function (set to 09:30 start time and 16:00 end time)
or, if the foregoing does not apply, the dollar volume-weighted average price of such security in the over-the-counter market on the electronic
bulletin board for such security during the period beginning at 9:30 a.m., New York time, and ending at 4:00 p.m., New York time, as reported
by Bloomberg, or, if no dollar volume-weighted average price is reported for such security by Bloomberg for such hours, the average of
the highest closing bid price and the lowest closing ask price of any of the market makers for such security as reported in The Pink Open
Market (or a similar organization or agency succeeding to its functions of reporting prices). If the VWAP cannot be calculated for such
security on such date on any of the foregoing bases, the VWAP of such security on such date shall be the fair market value as mutually
determined by the Company and the Holder. If the Company and the Holder are unable to agree upon the fair market value of such security,
then such dispute shall be resolved in accordance with the procedures in Section 15. All such determinations shall be appropriately
adjusted for any stock dividend, stock split, stock combination, recapitalization or other similar transaction during such period.
[signature page follows]
IN WITNESS WHEREOF,
the Company has caused this Warrant to Purchase Common Stock to be duly executed as of the Issuance Date set out above.
| |
ADITXT,
INC. |
| |
|
|
| |
By: |
|
| |
|
Name: |
Amro Albanna |
| |
|
Title: |
Chief Executive Officer |
EXHIBIT A
EXERCISE NOTICE
TO BE EXECUTED
BY THE REGISTERED HOLDER TO EXERCISE THIS
WARRANT TO PURCHASE COMMON STOCK
ADITXT,
INC.
The undersigned holder hereby
elects to exercise the Warrant to Purchase Common Stock No. _______ (the “Warrant”) of Aditxt, Inc., a Delaware
corporation (the “Company”) as specified below. Capitalized terms used herein and not otherwise defined shall have
the respective meanings set forth in the Warrant.
1. Form
of Exercise Price. The Holder intends that payment of the Aggregate Exercise Price shall be made as:
| ☐ | a “Cash Exercise”
with respect to _________________ Warrant Shares; and/or |
| ☐ | a “Cashless Exercise” with respect to _______________
Warrant Shares. |
In the event that the Holder
has elected a Cashless Exercise with respect to some or all of the Warrant Shares to be issued pursuant hereto, the Holder hereby represents
and warrants that (i) this Exercise Notice was executed by the Holder at __________ [a.m.][p.m.] on the date set forth below and (ii)
if applicable, the Bid Price as of such time of execution of this Exercise Notice was $________.
2. Payment
of Exercise Price. In the event that the Holder has elected a Cash Exercise with respect to some or all of the Warrant Shares to be
issued pursuant hereto, the Holder shall pay the Aggregate Exercise Price in the sum of $___________________
to the Company in accordance with the terms of the Warrant.
3. Delivery
of Warrant Shares. The Company shall deliver to Holder, or its designee or agent as specified below, __________ shares of Common
Stock in accordance with the terms of the Warrant. Delivery shall be made to Holder, or for its benefit,
as follows:
☐ Check
here if requesting delivery as a certificate to the following name and to the following address:
☐ Check here if requesting delivery by Deposit/Withdrawal at Custodian as follows:
| |
DTC Participant: |
|
| |
DTC Number: |
|
| |
Account Number: |
|
| Date: _____________ __,________ |
|
| |
|
| Name of Registered Holder |
|
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Tax ID: ____________________________ |
|
| |
Facsimile: __________________________ |
|
| |
E-mail Address: _____________________ |
|
EXHIBIT B
ACKNOWLEDGMENT
The
Company hereby acknowledges this Exercise Notice and hereby directs ______________ to issue the above indicated number
of shares of Common Stock in accordance with the Transfer Agent Instructions dated _________, 202_, from the Company and acknowledged
and agreed to by _______________.
| |
ADITXT, INC. |
| |
|
|
| |
By: |
|
| |
|
Name: |
Amro Albanna |
| |
|
Title: |
Chief Executive Officer |
Exhibit 10.1
EVOFEM BIOSCIENCES,
INC.
WAIVER AGREEMENT
THIS
WAIVER AGREEMENT (this “Waiver Agreement”) is made as of July 12, 2024 by and between Evofem Biosciences,
Inc. a Delaware corporation (the “Company”), and Aditxt, Inc., a Delaware corporation (the “Parent”)
Adifem, Inc., f/k/a Adicure, Inc., a Delaware corporation (“Merger Sub” and together with the Company and Parent,
the “Parties” and each a “Party”).
RECITALS
WHEREAS,
the Parties are currently part of that certain Agreement and Plan of Merger dated as of December 11, 2023 (as amended by that First Amendment
dated January 8, 2024, that Second Amendment dated January 30, 2024, that Third Amendment dated February 29, 2024 and that Reinstatement
and Fourth Amendment dated as of May 2, 2024, the “Merger Agreement”);
WHEREAS,
the Parent and Merger Sub have previously failed to comply with Section 6.10 of the Merger Agreement;
WHEREAS,
the Company currently holds a termination right, under Section 8.1(f) of the Merger Agreement (the “Termination Right”);
WHEREAS,
for good and valuable consideration, the Parent and Merger Sub have asked the Company to waive its Termination Right for the Parent and
Merger Sub’s failure to comply with Section 6.10 (the “Termination Waiver”);
WHEREAS,
the Company, by execution of this Waiver Agreement, intends to agree to the Parent and Merger Sub’s request with respect to the
Termination Waiver;
WHEREAS,
the Company and Lupin, Inc. intend to enter into that certain Asset Purchase Agreement effective as of July 14, 2024 (the “APA”),
pursuant to which the Company will purchase certain assets including the pharmaceutical product that is currently is marketed for sale
to consumers under the trademark SOLOSEC®;
WHEREAS,
in June 2024, the Company entered into a short-term debt arrangement relating to the Company’s Directors’ and Officers’
Insurance Policy (the “D&O Financing”);
WHEREAS,
the Merger Agreement contains certain restrictive covenants, including those in Section 6.1(a) and Section 6.1(b) that may restrict or
prohibit the Company’s ability to enter into the APA and the D&O Financing; and
WHEREAS,
for good and valuable consideration, the Company has asked the Parent and Merger Sub to waive the restrictive covenants in Section 6.1(a)
and Section 6.1(b) in relation to the APA (“APA Waiver) and the D&O Financing (“D&O Financing
Waiver”); and
WHEREAS,
the D&O Financing Waiver waiver was covered by the provisions of the agreement between Company, Parent and Merger Sub in effect following
the Fourth Amendment to the Merger Agreement, but for avoidance of doubt following the later amendment and restatement of the Merger Agreement,
Parent agrees to waive the application of any of the restrictive covenants that may be deemed applicable thereto;
WHEREAS;
the Parent, by execution of this Waiver Agreement intends to agree to the Company’s request with respect to the APA Waiver and D&O
Waiver.
NOW,
THEREFORE, in consideration of the forgoing premises and mutual covenants, the parties agree to the following:
AGREEMENT
| 1. | The Termination Waiver. The Company hereby waives
the Termination Right under the Merger Agreement for such breaches by the Parent and Merger Sub that have occurred prior to the date
of this Waiver Agreement; |
| 2. | The APA Waiver. The Parent and Merger Sub hereby
waive the restrictive covenants in the Merger Agreement that may restrict the Company’s ability to enter into and close the APA. |
| 3. | The D&O Waiver. The Parent and Merger Sub
hereby waive the restrictive covenants in the Merger Agreement that may restrict the Company relating to the D&O Financing. |
| 4. | Successors and Assigns. The Parties acknowledge
and agree that the terms of this Waiver Agreement are binding on and shall inure to the benefit of their respective beneficiaries, heirs,
legatees and other statutorily designated representatives. |
| 5. | Counterparts. This Waiver Agreement may be executed
in counterparts (including by electronic means), all of which shall be considered one and the same agreement and shall become effective
when signed by each of the parties and delivered to the other parties, it being understood that all parties need not sign the same counterpart. |
| 6. | Amendment. This Waiver Agreement may not be
amended, changed, supplemented, waived or otherwise modified or terminated, except upon the execution and delivery of a written agreement
executed by the Parties. |
| 7. | Severability. If any provision of this Waiver
Agreement is held invalid or unenforceable by any court of competent jurisdiction, the other provisions of this Waiver Agreement will
remain in full force and effect. Any provision of this Waiver Agreement held invalid or unenforceable only in part or degree will remain
in full force and effect to the extent not held invalid or unenforceable. |
| 8. | Governing
Law. This Amendment shall be governed in all respects by and construed in accordance with the laws of the State of Delaware without
regard to provisions regarding choice of laws. |
[The Remainder of
this Page Intentionally Left Blank]
IN WITNESS WHEREOF, the
undersigned have executed this Waiver Agreement as of the date first written above.
| |
COMPANY |
| |
|
| |
Evofem Biosciences, Inc. |
| |
|
|
| |
By: |
/s/ Saundra Peletier |
| |
Name: |
Saundra Pelletier |
| |
Title: |
Chief Executive Officer |
[Signature
Page to the Waiver Agreement]
IN WITNESS WHEREOF, the
undersigned has executed this Waiver Agreement as of the date first written above.
| |
PARENT |
| |
|
| |
Aditxt, Inc. |
| |
|
| |
By: |
/s/ Amro Albanna |
| |
Name: |
Amro Albanna |
| |
Title: |
Chief Executive Officer |
| |
|
| |
MERGER SUB |
| |
|
| |
Adifem, Inc., f/k/a Adicure, Inc. |
| |
|
| |
By: |
/s/ Amro Albanna |
| |
Name: |
Amro Albanna |
| |
Title: |
Chief Executive Officer |
[Signature
Page to the Waiver Agreement]
4
Exhibit 10.2
SECURITIES PURCHASE AGREEMENT
This Securities Purchase Agreement
(this “Agreement”) is dated as of July 12, 2024, between Aditxt, Inc., a Delaware corporation (the “Company”)
and each purchaser identified on the signature pages hereto (each, including its successors and assigns, a “Purchaser”
and collectively, the “Purchasers”)).
WHEREAS, subject to the terms
and conditions set forth in this Agreement and pursuant to Section 4(a)(2) of the Securities Act (as defined below), and Rule 506 promulgated
thereunder, the Company desires to issue and sell to each Purchaser, and each Purchaser, severally and not jointly, desires to purchase
from the Company, securities of the Company as more fully described in this Agreement.
NOW, THEREFORE, IN CONSIDERATION
of the mutual covenants contained in this Agreement, and for other good and valuable consideration, the receipt and adequacy of which
are hereby acknowledged, the Company and each Purchaser agree as follows:
ARTICLE I.
DEFINITIONS
1.1 Definitions.
In addition to the terms defined elsewhere in this Agreement: (a) capitalized terms that are not otherwise defined herein have the meanings
given to such terms in the Notes (as defined herein), and (b) the following terms have the meanings set forth in this Section 1.1:
“Acquiring
Person” shall have the meaning ascribed to such term in Section 4.7.
“Action”
shall have the meaning ascribed to such term in Section 3.1(j).
“Affiliate”
means any Person that, directly or indirectly through one or more intermediaries, controls or is controlled by or is under common control
with a Person, as such terms are used in and construed under Rule 405 under the Securities Act.
“Board
of Directors” means the board of directors of the Company.
“Business
Day” means any day other than Saturday, Sunday or other day on which commercial banks in The City of New York are authorized
or required by law to remain closed; provided, however, for clarification, commercial banks shall not be deemed to be authorized
or required by law to remain closed due to “stay at home”, “shelter-in-place”, “non-essential employee”
or any other similar orders or restrictions or the closure of any physical branch locations at the direction of any governmental authority
so long as the electronic funds transfer systems (including for wire transfers) of commercial banks in The City of New York are generally
open for use by customers on such day.
“Closing”
means 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.
“Commission”
means the United States Securities and Exchange Commission.
“Common
Stock” means the common stock of the Company, par value $0.001 per share, and any other class of securities into which such
securities may hereafter be reclassified or changed.
“Common
Stock Equivalents” means any securities of the Company or the Subsidiaries which would entitle the holder thereof to acquire
at any time Common Stock, including, without limitation, any debt, preferred stock, right, option, warrant or other instrument that is
at any time convertible into or exercisable or exchangeable for, or otherwise entitles the holder thereof to receive, Common Stock.
“Company
Counsel” means Sheppard, Mullin, Richter & Hampton LLP, with offices located at 30 Rockefeller Plaza, New York, New York
10112.
“Data Privacy
and Security Laws” shall have the meaning ascribed to such term in Section 3.1(mm).
“Disclosure
Time” means, (i) if this Agreement is signed on a day that is not a Trading Day or after 9:00 a.m. (New York City time) and
before midnight (New York City time) on any Trading Day, 9:01 a.m. (New York City time) on the Trading Day immediately following the date
hereof, and (ii) if this Agreement is signed between midnight (New York City time) and 9:00 a.m. (New York City time) on any Trading Day,
no later than 9:01 a.m. (New York City time) on the date hereof.
“Evaluation
Date” shall have the meaning ascribed to such term in Section 3.1(s).
“Exchange
Act” means the Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder.
“FCPA”
means the Foreign Corrupt Practices Act of 1977, as amended.
“GAAP”
shall have the meaning ascribed to such term in Section 3.1(h).
“Indebtedness”
shall have the meaning ascribed to such term in the Notes.
“Intellectual
Property Rights” shall have the meaning ascribed to such term in Section 3.1(p).
“IT Systems”
shall have the meaning ascribed to such term in Section 3.1(mm).
“Legend
Removal Date” shall have the meaning ascribed to such term in Section 4.1(c).
“Lien”
means any lien, mortgage, pledge, assignment, security interest, charge or encumbrance of any kind (including any agreement to give any
of the foregoing, any conditional sale or other title retention agreement, and any lease in the nature thereof) and any option, trust
or other preferential arrangement having the practical effect of any of the foregoing.
“Material
Adverse Effect” shall have the meaning assigned to such term in Section 3.1(b).
“Material
Permits” shall have the meaning ascribed to such term in Section 3.1(n).
“Maximum
Rate” shall have the meaning ascribed to such term in Section 5.17.
“Notes”
means the Original Issue Discount Senior Notes due, subject to the terms therein, within 90 days of the Closing Date, issued by the Company
to the Purchasers hereunder, in the form of Exhibit A attached hereto.
“Person”
means an individual or corporation, partnership, trust, incorporated or unincorporated association, joint venture, limited liability company,
joint stock company, government (or an agency or subdivision thereof) or other entity of any kind.
“Personal
Data” shall have the meaning ascribed to such term in Section 3.1(mm).
“Principal
Amount” means, as to each Purchaser, the amounts set forth below such Purchaser’s signature block on the signature pages
hereto next to the heading “Principal Amount,” in United States Dollars, which shall equal such Purchaser’s Subscription
Amount multiplied by 1.1111.
“Proceeding”
means an action, claim, suit, investigation or proceeding (including, without limitation, an informal investigation or partial proceeding,
such as a deposition), whether commenced or threatened.
“Processing”
shall have the meaning ascribed to such term in Section 3.1(mm).
“Public
Information Failure” shall have the meaning ascribed to such term in Section 4.3(b).
“Public
Information Failure Payments” shall have the meaning ascribed to such term in Section 4.3(b).
“Purchaser
Party” shall have the meaning ascribed to such term in Section 4.10.
“Required
Approvals” shall have the meaning ascribed to such term in Section 3.1(e).
“Required
Holders” means (I) prior to the Closing Date, each of the Purchasers and (II) on or after the Closing Date, holders of at least
a majority of the aggregate Principal Amount of Notes issued.
“Required
Minimum” means, as of any date, the maximum aggregate number of shares of Common Stock then issued or potentially issuable in
the future pursuant to the Transaction Documents.
“Rule 144”
means Rule 144 promulgated by the Commission pursuant to the Securities Act, as such Rule may be amended from time to time, or any similar
rule or regulation hereafter adopted by the Commission having substantially the same effect as such Rule.
“Rule 424”
means Rule 424 promulgated by the Commission pursuant to the Securities Act, as such Rule may be amended or interpreted from time to time,
or any similar rule or regulation hereafter adopted by the Commission having substantially the same purpose and effect as such Rule.
“SEC Reports”
shall have the meaning ascribed to such term in Section 3.1(h).
“Securities”
means the Notes, the Warrants and the Warrant Shares.
“Securities
Act” means the Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder.
“Short
Sales” means all “short sales” as defined in Rule 200 of Regulation SHO under the Exchange Act (but shall not be
deemed to include locating and/or borrowing shares of Common Stock).
“Standard
Settlement Period” shall have the meaning ascribed to such term in Section 4.1(c).
“Subscription
Amount” means, as to each Purchaser, the aggregate amount to be paid for Notes 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.
“Subsidiary”
means any subsidiary of the Company as set forth in the SEC Reports and shall, where applicable, also include any direct or indirect subsidiary
of the Company formed or acquired after the date hereof. “Subsidiary” of any Person shall include any corporation, limited
or general partnership, limited liability company, trust, estate, association, joint venture or other business entity (a) the accounts
of which would be consolidated with those of such Person in such Person’s consolidated financial statements if such financial statements
were prepared in accordance with GAAP or (b) of which more than 50% of (i) the outstanding equity interests having (in the absence of
contingencies) ordinary voting power to elect a majority of the board of directors of such Person, (ii) in the case of a partnership or
limited liability company, the interest in the capital or profits of such partnership or limited liability company or (iii) in the case
of a trust, estate, association, joint venture or other entity, the beneficial interest in such trust, estate, association or other entity
business is, at the time of determination, owned or controlled directly or indirectly through one or more intermediaries, by such Person.
“Trading
Day” means a day on which the principal Trading Market is open for trading.
“Trading
Market” means any of the following markets or exchanges on which the Common Stock is listed or quoted for trading on the date
in question: the NYSE American, the Nasdaq Capital Market, the Nasdaq Global Market, the Nasdaq Global Select Market, the New York Stock
Exchange, the OTCQB or the OTCQX (or any successors to any of the foregoing).
“Transaction
Documents” means this Agreement, the Notes and all exhibits and schedules thereto and hereto and any other documents or agreements
executed in connection with the transactions contemplated hereunder.
“Transfer
Agent” means VStock Transfer LLC, the current transfer agent of the Company and any successor transfer agent of the Company.
“VWAP”
means, for any date, the price determined by the first of the following clauses that applies: (a) if the Common Stock is then listed or
quoted on a Trading Market, the daily volume weighted average price of the Common Stock for such date (or the nearest preceding date)
on the Trading Market on which the Common Stock is then listed or quoted as reported by Bloomberg L.P. (based on a Trading Day from 9:30
a.m. (New York City time) to 4:02 p.m. (New York City time)), (b) if OTCQB or OTCQX is not a Trading Market, the volume weighted
average price of the Common Stock for such date (or the nearest preceding date) on OTCQB or OTCQX as applicable, (c) if the Common Stock
is not then listed or quoted for trading on OTCQB or OTCQX and if prices for the Common Stock are then reported on the Pink Open Market
(or a similar organization or agency succeeding to its functions of reporting prices), the most recent bid price per share of the Common
Stock so reported, or (d) in all other cases, the fair market value of a share of Common Stock as determined by an independent appraiser
selected in good faith by the Required Holders then outstanding and reasonably acceptable to the Company, the fees and expenses of which
shall be paid by the Company.
“Warrants”
means the warrants to purchase shares of Common Stock issued pursuant to this Agreement.
“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, the Company agrees to sell, and the Purchasers, severally
and not jointly, agree to purchase, up to an aggregate of $3.125 million in principal amount of the Notes. Each Purchaser shall deliver
to the Company’s bank account specified in the Company’s wire instructions, as set forth in a letter addressed to the Purchasers on the
Company’s letterhead and executed by the Company’s Chief Financial Officer or Chief Executive Officer, via wire transfer 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, the amounts withheld pursuant to Section 5.2), and the Company shall deliver to each Purchaser its respective Note
and 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
Note with a principal amount equal to such Purchaser’s Subscription Amount multiplied by 1.1111, registered in the name of such
Purchaser;
(iii) a
Warrant, registered in the name of such Purchaser, to purchase that number of shares of the Company’s Common Stock equal to the
principal amount of such Purchaser’s Note multiplied by two. Notwithstanding anything herein to the contrary, the Company shall
not issue any Warrant Shares pursuant to the terms of this Agreement of the Warrant if the issuance of such Warrant Shares plus any shares
of the Company’s Common Stock issued in connection with the May 24 Securities Purchase Agreement would exceed the aggregate number
of shares of Common Stock which the Company may issue without breaching the Company’s obligations under the rules and regulations
the listing rules of the Principal Market (the maximum number of shares of Common Stock which may be issued without violating such rules
and regulations, the “Exchange Cap”), except that such limitation shall not apply in the event that the Company (A) obtains
the approval of its stockholders as required by the applicable rules and regulations of the Principal Market for issuances of shares of
Common Stock in excess of such amount (the “Stockholder Approval Date”) or (B) obtains a written opinion from outside counsel
to the Company that such approval is not required, which opinion shall be reasonably satisfactory to the Required Holders. Until such
approval or such written opinion is obtained, no Purchaser shall be issued in the aggregate, Warrant Shares in an amount greater than
the product of (i) the Exchange Cap as of the Initial Issuance Date multiplied by (ii) the quotient of (1) such Purchaser’s Subscription
Amount divided by (2) the total aggregate Subscription Amount of all Purchasers under this Agreement and the May 24, 2024 securities purchase
agreement (with respect to each Purchaser, the “Exchange Cap Allocation”). Any remaining Shares shall be issued to
the Purchaser on the Trading Day following the Stockholder Approval Date.;
(iv) the
Company shall have provided each Purchaser with the wire instructions of the Company, on Company letterhead and executed by the Chief
Executive Officer or Chief Financial Officer; and
(v) the
Company shall have delivered to such Purchaser such other documents relating to the transactions contemplated by this Agreement as such
Purchaser or its counsel may reasonably request.
(b) On
or prior to the Closing Date, each Purchaser shall deliver or cause to be delivered to the Company the following:
| (i) | this Agreement duly executed by such Purchaser; and |
| (ii) | such Purchaser’s Subscription Amount by wire transfer to the account specified in writing by the
Company. |
2.3 Closing
Conditions.
(a) The
obligations of the Company hereunder in connection with the Closing are subject to the following conditions being met:
(i) the
accuracy in all material respects (or, to the extent representations or warranties are qualified by materiality, in all respects) on the
Closing Date of the representations and warranties of the Purchasers contained herein (unless as of a specific date therein in which case
they shall be accurate in all material respects (or, to the extent representations or warranties are qualified by materiality, in all
respects) as of such date);
(ii) all
obligations, covenants and agreements of each Purchaser required to be performed at or prior to the Closing Date shall have been performed;
and
(iii) the
delivery by each Purchaser of the items set forth in Section 2.2(b) of this Agreement.
(b) The
respective obligations of the Purchasers hereunder in connection with the Closing are subject to the following conditions being met:
(i) the
accuracy in all material respects (or, to the extent representations or warranties are qualified by materiality or Material Adverse Effect,
in all respects) when made and on the Closing Date of the representations and warranties of the Company contained herein (unless as of
a specific date therein in which case they shall be accurate in all material respects or, to the extent representations or warranties
are qualified by materiality or Material Adverse Effect, in all respects) as of such date;
(ii) all
obligations, covenants and agreements of the Company required to be performed at or prior to the Closing Date shall have been performed;
(iii) the
delivery by the Company of the items set forth in Section 2.2(a) of this Agreement;
(iv) there
shall have been no Material Adverse Effect with respect to the Company; and
(v) from
the date hereof to the Closing Date, trading in the Common Stock shall not have been suspended by the Commission or the Company’s
principal Trading Market and, at any time prior to the Closing Date, trading in securities generally as reported by Bloomberg L.P. shall
not have been suspended or limited, or minimum prices shall not have been established on securities whose trades are reported by such
service, or on any Trading Market, nor shall a banking moratorium have been declared either by the United States or New York State authorities
nor shall there have occurred any material outbreak or escalation of hostilities or other national or international calamity of such magnitude
in its effect on, or any material adverse change in, any financial market which, in each case, in the reasonable judgment of such Purchaser,
makes it impracticable or inadvisable to purchase the Securities at the Closing.
ARTICLE III.
REPRESENTATIONS AND WARRANTIES
3.1 Representations
and Warranties of the Company. The Company hereby makes the following representations and warranties to each Purchaser:
(a) Subsidiaries.
All of the direct and indirect subsidiaries of the Company are set forth in the SEC Reports. The Company owns, directly or indirectly,
all of the capital stock or other equity interests of each Subsidiary free and clear of any Liens, and all of the issued and outstanding
shares of capital stock of each Subsidiary are validly issued and are fully paid, non-assessable and free of preemptive and similar rights
to subscribe for or purchase securities.
(b) Organization
and Qualification. Except as set forth on Schedule 3.1(b), the Company and each of the Subsidiaries is an entity duly incorporated
or otherwise organized, validly existing and in good standing under the laws of the jurisdiction of its incorporation or organization,
with the requisite power and authority to own and use its properties and assets and to carry on its business as currently conducted. Neither
the Company nor any Subsidiary is in violation nor default of any of the provisions of its respective certificate or articles of incorporation,
bylaws or other organizational or charter documents. Each of the Company and the Subsidiaries is duly qualified to conduct business and
is in good standing as a foreign corporation or other entity in each jurisdiction in which the nature of the business conducted or property
owned by it makes such qualification necessary, except where the failure to be so qualified or in good standing, as the case may be, would
not have or reasonably be expected to result in: (i) a material adverse effect on the legality, validity or enforceability of any Transaction
Document, (ii) a material adverse effect on the results of operations, assets, business, prospects or condition (financial or otherwise)
of the Company and the Subsidiaries, taken as a whole, or (iii) a material adverse effect on the Company’s ability to perform in
any material respect on a timely basis its obligations under any Transaction Document (any of (i), (ii) or (iii), a “Material
Adverse Effect”) and no Proceeding has been instituted in any such jurisdiction revoking, limiting or curtailing or seeking
to revoke, limit or curtail such power and authority or qualification.
(c) Authorization;
Enforcement.
(i) The
Company has the requisite corporate power and authority to enter into and to consummate the transactions contemplated by this Agreement
and each of the other Transaction Documents and otherwise to carry out its obligations hereunder and thereunder. The execution and delivery
of this Agreement and each of the other Transaction Documents by the Company and the consummation by it of the transactions contemplated
hereby and thereby have been duly authorized by all necessary action on the part of the Company and no further action is required by the
Company, the Board of Directors or the Company’s stockholders in connection herewith or therewith other than in connection with
the Required Approvals. This Agreement and each other Transaction Document to which it is a party has been (or upon delivery will have
been) duly executed by the Company and, when delivered in accordance with the terms hereof and thereof, will constitute the valid and
binding obligation of the Company enforceable against the Company in accordance with its terms, except (i) as limited by general equitable
principles and applicable bankruptcy, insolvency, reorganization, moratorium and other laws of general application affecting enforcement
of creditors’ rights generally, (ii) as limited by laws relating to the availability of specific performance, injunctive relief
or other equitable remedies or (iii) insofar as indemnification and contribution provisions may be limited by applicable law.
(d) No
Conflicts. The execution, delivery and performance by the Company of this Agreement and the other Transaction Documents to which it
is a party, the issuance and sale of the Securities and the consummation by it of the transactions contemplated hereby and thereby do
not and will not (i) conflict with or violate any provision of the Company’s or any Subsidiary’s certificate or articles of
incorporation, bylaws or other organizational or charter documents, or (ii) subject to the Required Approvals, conflict with, or constitute
a default (or an event that with notice or lapse of time or both would become a default) under, result in the creation of any Lien upon
any of the properties or assets of the Company or any Subsidiary, or give to others any rights of termination, amendment, anti-dilution
or similar adjustments, acceleration or cancellation (with or without notice, lapse of time or both) of, any agreement, credit facility,
debt or other instrument (evidencing a Company or Subsidiary debt or otherwise) or other understanding to which the Company or any Subsidiary
is a party or by which any property or asset of the Company or any Subsidiary is bound or affected, or (iii) subject to the Required Approvals,
conflict with or result in a violation of any law, rule, regulation, order, judgment, injunction, decree or other restriction of any court
or governmental authority to which the Company or a Subsidiary is subject (including federal and state securities laws and regulations),
or by which any property or asset of the Company or a Subsidiary is bound or affected; except in the case of each of clauses (ii) and
(iii), such as would not have or reasonably be expected to result in a Material Adverse Effect.
(e) Filings,
Consents and Approvals. The Company is not required to obtain any consent, waiver, authorization or order of, give any notice to,
or make any filing or registration with, any court or other federal, state, local or other governmental authority or other Person in connection
with the execution, delivery and performance by the Company of the Transaction Documents, other than: (i) the filings required pursuant
to Section 4.6 of this Agreement, (ii) the notice and/or application(s) to each applicable Trading Market for the issuance and sale of
the Securities, (iii) the filing of Form D with the Commission and such filings as are required to be made under applicable state securities
laws and (iv) the consents that shall be obtained prior to Closing (collectively, the “Required Approvals”).
(f) Issuance
of the Securities. The Securities are duly authorized and, when issued and paid for in accordance with the applicable Transaction
Documents, will be duly and validly issued, fully paid and nonassessable, free and clear of all Liens imposed by the Company other than
restrictions on transfer provided for in the Transaction Documents or under federal or state securities laws. The Warrant Shares, when
issued in accordance with the terms of the Warrants, 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 Warrant Shares at least equal to the Required Minimum
on the date hereof.
(g) Capitalization.
The Company has not issued any capital stock since its most recently filed periodic report under the Exchange Act, other than pursuant
to the exercise of employee stock options under the Company’s stock award plans, the issuance of shares of Common Stock or stock
options to employees, directors and consultants pursuant to the Company’s employee stock award plans and pursuant to the conversion
and/or exercise of Common Stock Equivalents outstanding as of the date of the most recently filed periodic report under the Exchange Act.
No Person has any right of first refusal, preemptive right, right of participation, or any similar right to participate in the transactions
contemplated by the Transaction Documents. The issuance and sale of the Securities will not obligate the Company or any Subsidiary to
issue shares of Common Stock or other securities to any Person (other than the Purchasers). There are no outstanding securities or instruments
of the Company or any Subsidiary with any provision that adjusts the exercise, conversion, exchange or reset price of such security or
instrument upon an issuance of securities by the Company or any Subsidiary. There are no outstanding securities or instruments of the
Company or any Subsidiary that contain any redemption or similar provisions, and there are no contracts, commitments, understandings or
arrangements by which the Company or any Subsidiary is or may become bound to redeem a security of the Company or such Subsidiary. Except
for the Company’s 2021 Stock Award Plan, as amended, the Company does not have any stock appreciation rights or “phantom stock”
plans or agreements or any similar plan or agreement. All of the outstanding shares of capital stock of the Company are duly authorized,
validly issued, fully paid and nonassessable, have been issued in compliance with all federal and state securities laws, and none of such
outstanding shares was issued in violation of any preemptive rights or similar rights to subscribe for or purchase securities. No further
approval or authorization of any stockholder, the Board of Directors or others is required for the issuance and sale of the Securities.
There are no stockholders agreements, voting agreements or other similar agreements with respect to the Company’s capital stock
to which the Company is a party or, to the knowledge of the Company, between or among any of the Company’s stockholders.
(h) SEC
Reports; Financial Statements. The Company has filed all reports, schedules, forms, statements and other documents required to be
filed by the Company under the Securities Act and the Exchange Act, including pursuant to Section 13(a) or 15(d) thereof, for the two
years preceding the date hereof (or such shorter period as the Company was required by law or regulation to file such material) (the foregoing
materials, including the exhibits thereto and documents incorporated by reference therein, being collectively referred to herein as the
“SEC Reports”) on a timely basis (except as set forth in the SEC Reports) or has received a valid extension of such
time of filing and has filed any such SEC Reports prior to the expiration of any such extension. As of their respective dates, the SEC
Reports complied in all material respects with the requirements of the Securities Act and the Exchange Act, as applicable, and none of
the SEC Reports, when filed, contained any untrue statement of a material fact or omitted to state a material fact required to be stated
therein or necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading.
The financial statements of the Company included in the SEC Reports comply in all material respects with applicable accounting requirements
and the rules and regulations of the Commission with respect thereto as in effect at the time of filing. Such financial statements have
been prepared in accordance with United States generally accepted accounting principles applied on a consistent basis during the periods
involved (“GAAP”), except as may be otherwise specified in such financial statements or the notes thereto and except
that unaudited financial statements may not contain all footnotes required by GAAP, and fairly present in all material respects the financial
position of the Company and its consolidated Subsidiaries as of and for the dates thereof and the results of operations and cash flows
for the periods then ended, subject, in the case of unaudited statements, to normal, immaterial, year-end audit adjustments.
(i) Material
Changes; Undisclosed Events, Liabilities or Developments. Since the date of the latest audited financial statements included within
the SEC Reports, except as disclosed in the SEC Reports (i) there has been no event, occurrence or development that has had or that would
reasonably be expected to result in a Material Adverse Effect, (ii) the Company has not incurred any liabilities (contingent or otherwise)
other than (A) trade payables and accrued expenses incurred in the ordinary course of business consistent with past practice and (B) liabilities
not required to be reflected in the Company’s financial statements pursuant to GAAP or disclosed in filings made with the Commission,
(iii) the Company has not altered its method of accounting, (iv) the Company has not declared or made any dividend or distribution of
cash or other property to its stockholders or purchased, redeemed or made any agreements to purchase or redeem any shares of its capital
stock and (v) the Company has not issued any equity securities to any officer, director or Affiliate, except pursuant to existing Company
stock award plans. The Company does not have pending before the Commission any request for confidential treatment of information (excluding
redactions permitted by Item 6.01 of Regulation S-K). Except for the issuance of the Securities contemplated by this Agreement, no event,
liability, fact, circumstance, occurrence or development has occurred or exists or is reasonably expected to occur or exist with respect
to the Company or its Subsidiaries or their respective businesses, prospects, properties, operations, assets or financial condition, that
would be required to be disclosed by the Company under applicable securities laws at the time this representation is made or deemed made
that has not been publicly disclosed prior to the date that this representation is made.
(j) Litigation.
There is no action, suit, proceeding or investigation pending against or affecting the Company, any Subsidiary or any of their respective
properties before or by any court, arbitrator, governmental or administrative agency or regulatory authority (federal, state, county,
local or foreign) (collectively, an “Action”) that (i) adversely affects or challenges the legality, validity or enforceability
of any of the Transaction Documents or the Securities or (ii) would, if there were an unfavorable decision, have or reasonably be expected
to result in a Material Adverse Effect. Neither the Company nor any Subsidiary, nor any director or officer thereof, is or has been the
subject of any Action involving a claim of violation of or liability under federal or state securities laws or a claim of breach of fiduciary
duty. There has not been, and to the knowledge of the Company, there is not pending or contemplated, any investigation by the Commission
involving the Company or any current director or officer of the Company. The Commission has not issued any stop order or other order suspending
the effectiveness of any registration statement filed by the Company or any Subsidiary under the Exchange Act or the Securities Act.
(k) Labor
Relations. No labor dispute exists or, to the knowledge of the Company, is imminent with respect to any of the employees of the Company,
which would reasonably be expected to result in a Material Adverse Effect. None of the Company’s or its Subsidiaries’ employees
is a member of a union that relates to such employee’s relationship with the Company or such Subsidiary, and neither the Company
nor any of its Subsidiaries is a party to a collective bargaining agreement, and the Company and its Subsidiaries believe that their relationships
with their employees are good. To the knowledge of the Company, no executive officer of the Company or any Subsidiary, is, or is now expected
to be, in violation of any material term of any employment contract, confidentiality, disclosure or proprietary information agreement
or non-competition agreement, or any other contract or agreement or any restrictive covenant in favor of any third party, and the continued
employment of each such executive officer does not subject the Company or any of its Subsidiaries to any liability with respect to any
of the foregoing matters. The Company and its Subsidiaries are in compliance with all U.S. federal, state, local and foreign laws and
regulations relating to employment and employment practices, terms and conditions of employment and wages and hours, except where the
failure to be in compliance would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.
(l) Compliance.
Neither the Company nor any Subsidiary: (i) is in default under or in violation of (and no event has occurred that has not been waived
that, with notice or lapse of time or both, would result in a default by the Company or any Subsidiary under), nor has the Company or
any Subsidiary received notice of a claim that it is in default under or that it is in violation of, any indenture, loan or credit agreement
or any other agreement or instrument to which it is a party or by which it or any of its properties is bound (whether or not such default
or violation has been waived), (ii) is in violation of any judgment, decree or order of any court, arbitrator or other governmental authority
or (iii) is or has been in violation of any statute, rule, ordinance or regulation of any governmental authority, including without limitation
all foreign, federal, state and local laws relating to taxes, environmental protection, occupational health and safety, product quality
and safety and employment and labor matters, except in each case as would not have or reasonably be expected to result in a Material Adverse
Effect.
(m) Environmental
Laws. The Company and its Subsidiaries (i) are in compliance with all federal, state, local and foreign laws relating to
pollution or protection of human health or the environment (including ambient air, surface water, groundwater, land surface or
subsurface strata), including laws relating to emissions, discharges, releases or threatened releases of chemicals, pollutants,
contaminants, or toxic or hazardous substances or wastes (collectively, “Hazardous Materials”) into the
environment, or otherwise relating to the manufacture, processing, distribution, use, treatment, storage, disposal, transport or
handling of Hazardous Materials, as well as all authorizations, codes, decrees, demands, or demand letters, injunctions, judgments,
licenses, notices or notice letters, orders, permits, plans or regulations, issued, entered, promulgated or approved thereunder
(“Environmental Laws”); (ii) have received all permits licenses or other approvals required of them under
applicable Environmental Laws to conduct their respective businesses; and (iii) are in compliance with all terms and conditions of
any such permit, license or approval where in each clause (i), (ii) and (iii), the failure to so comply would be reasonably expected
to have, individually or in the aggregate, a Material Adverse Effect.
(n) Regulatory
Permits. The Company and the Subsidiaries possess all certificates, authorizations and permits issued by the appropriate federal,
state, local or foreign regulatory authorities necessary to conduct their respective businesses as described in the SEC Reports, except
where the failure to possess such permits could not reasonably be expected to result in a Material Adverse Effect (“Material
Permits”), and neither the Company nor any Subsidiary has received any notice of proceedings relating to the revocation or modification
of any Material Permit.
(o) Title
to Assets. The Company and the Subsidiaries have good and marketable title in fee simple to all real property owned by them and good
and marketable title in all personal property owned by them that is material to the business of the Company and the Subsidiaries, in each
case free and clear of all Liens, except for (i) Liens as do not materially affect the value of such property and do not materially interfere
with the use made and proposed to be made of such property by the Company and the Subsidiaries and (ii) Liens for the payment of federal,
state or other taxes, for which appropriate reserves have been made therefor in accordance with GAAP and, the payment of which is neither
delinquent nor subject to penalties. Any real property and facilities held under lease by the Company and the Subsidiaries are held by
them under valid, subsisting and enforceable leases with which the Company and the Subsidiaries are in compliance.
(p) Intellectual
Property. Except as disclosed in the SEC Reports, the Company and its Subsidiaries exclusively own (free and clear of all liens, encumbrances
and defects) or possess a valid license or other lawful right to use all Intellectual Property Rights necessary, used or held for use
to conduct its business as presently conducted and as presently proposed to be conducted. Each item of such Intellectual Property Rights
is valid and enforceable. Each of the licenses (in-bound or out-bound) of Intellectual Property Rights or other contracts (including settlement
agreements) is valid and enforceable, and none of the Company or its Subsidiaries and, to the knowledge of the Company and its Subsidiaries,
none of the counterparties to any such contract, is in default or breach thereunder or thereof. The conduct of the business of the Company
and its Subsidiaries does not infringe, misappropriate or otherwise violate or conflict with the Intellectual Property Rights of others.
To the knowledge of the Company and its Subsidiaries, no third party is infringing, misappropriating or otherwise conflicting with its
Intellectual Property Rights. Except as disclosed in the SEC Reports, none of the Company or its Subsidiaries are aware of any facts or
circumstances which might give rise to any of the foregoing infringements, misappropriations or other conflicts, or claims, actions or
proceedings. Each of the Company and its Subsidiaries has taken reasonable measures to protect the secrecy, confidentiality and value
of all of its Intellectual Property Rights, as applicable, and, to its knowledge, no unauthorized disclosure of any information comprising
any Intellectual Property Rights has occurred. All present and former employees, consultants and independent contractors of each of the
Company and its Subsidiaries that have been involved in the development of any Intellectual Property Rights used in the business of the
Company and its Subsidiaries have entered into written agreements under which such Persons (A) agree to protect the trade secrets, know-how
and other confidential information of the Company and its Subsidiaries, as applicable, and (B) assign to one of the Company or its Subsidiaries,
as applicable, all right, title and interest in and to all Intellectual Property Rights created by such Person in the course of his, her
or its employment or other engagement by the Company or any of its Subsidiaries. For purposes of this Agreement, “Intellectual
Property Rights” means all intellectual property and proprietary rights, including all (i) trademarks, trade names, service
marks, service names, domain names, and other designation of origin, together with all goodwill associated therewith, (ii) original works
of authorship and copyrights, (iii) patents and patent applications, together with all divisionals, continuations, continuations-in-part,
reissues and reexaminations thereof, including all rights to file applications for patent, (iv) trade secrets, know-how and other confidential
information, (v) software, including data, databases and documentation therefor, and (vi) inventions, licenses, approvals and governmental
authorizations.
(q) Insurance.
The Company and the Subsidiaries are insured by insurers of recognized financial responsibility against such losses and risks and in such
amounts as are prudent and customary in the businesses in which the Company and the Subsidiaries are engaged, including, but not limited
to, directors and officers insurance coverage at least equal to the aggregate Subscription Amount. Neither the Company nor any Subsidiary
has any reason to believe that it will not be able to renew its existing insurance coverage as and when such coverage expires or to obtain
similar coverage from similar insurers as may be necessary to continue its business without a significant increase in cost.
(r) Transactions
with Affiliates and Employees. Except as set forth in the SEC Reports, none of the officers or directors of the Company or any Subsidiary
and, to the knowledge of the Company, none of the employees of the Company or any Subsidiary is presently a party to any transaction with
the Company or any Subsidiary (other than for services as employees, officers and directors), including any contract, agreement or other
arrangement providing for the furnishing of services to or by, providing for rental of real or personal property to or from providing
for the borrowing of money from or lending of money to, or otherwise requiring payments to or from any officer, director or such employee
or, to the knowledge of the Company, any entity in which any officer, director, or any such employee has a substantial interest or is
an officer, director, trustee, stockholder, member or partner, in each case in excess of $120,000 other than for (i) payment of salary
or consulting fees for services rendered, (ii) reimbursement for expenses incurred on behalf of the Company and (iii) other employee benefits,
including stock option agreements under any stock award plan of the Company.
(s) Sarbanes-Oxley;
Internal Accounting Controls. The Company and the Subsidiaries are in compliance in all material respects with any and all applicable
requirements of the Sarbanes-Oxley Act of 2002, as amended, that are effective as of the date hereof, and any and all applicable rules
and regulations promulgated by the Commission thereunder that are effective as of the date hereof and as of the Closing Date. Except as
set forth in the SEC Reports, the Company and the Subsidiaries maintain a system of internal accounting controls sufficient to provide
reasonable assurance that: (i) transactions are executed in accordance with management’s general or specific authorizations, (ii)
transactions are recorded as necessary to permit preparation of financial statements in conformity with GAAP and to maintain asset accountability,
(iii) access to assets is permitted only in accordance with management’s general or specific authorization, and (iv) the recorded
accountability for assets is compared with the existing assets at reasonable intervals and appropriate action is taken with respect to
any differences. The Company and the Subsidiaries have established disclosure controls and procedures (as defined in Exchange Act Rules
13a-15(e) and 15d-15(e)) for the Company and the Subsidiaries and designed such disclosure controls and procedures to ensure that information
required to be disclosed by the Company in the reports it files or submits under the Exchange Act is recorded, processed, summarized and
reported, within the time periods specified in the Commission’s rules and forms. The Company’s certifying officers have evaluated
the effectiveness of the disclosure controls and procedures of the Company and the Subsidiaries as of the end of the period covered by
the most recently filed periodic report under the Exchange Act (such date, the “Evaluation Date”). The Company presented
in its most recently filed periodic report under the Exchange Act the conclusions of the certifying officers about the effectiveness of
the disclosure controls and procedures based on their evaluations as of the Evaluation Date. Since the Evaluation Date, there have been
no changes in the internal control over financial reporting (as such term is defined in the Exchange Act) that have materially affected,
or is reasonably likely to materially affect, the internal control over financial reporting of the Company and its Subsidiaries.
(t) Certain
Fees. No brokerage or finder’s fees or commissions are or will be payable by the Company or any Subsidiaries to any broker,
financial advisor or consultant, finder, placement agent, investment banker, bank or other Person with respect to the transactions contemplated
by the Transaction Documents. The Purchasers shall have no obligation with respect to any fees or with respect to any claims made by or
on behalf of other Persons for fees of a type contemplated in this Section that may be due in connection with the transactions contemplated
by the Transaction Documents.
(u) Private
Placement. Assuming the accuracy of the Purchasers’ representations and warranties set forth in Section 3.2, no registration
under the Securities Act is required for the offer and sale of the Securities by the Company to the Purchasers as contemplated hereby.
The issuance and sale of the Securities hereunder does not contravene the rules and regulations of the Trading Market.
(v) Investment
Company. The Company is not, and is not an Affiliate of, and immediately after receipt of payment for the Securities, will not be
or be an Affiliate of, an “investment company” within the meaning of the Investment Company Act of 1940, as amended. The Company
shall conduct its business in a manner so that it will not become an “investment company” subject to registration under the
Investment Company Act of 1940, as amended.
(w) [Intentionally
Omitted]
(x) Listing
and Maintenance Requirements. The Common Stock is registered pursuant to Section 12(b) or 12(g) of the Exchange Act, and the Company
has taken no action designed to, or which to its knowledge is likely to have the effect of, terminating the registration of the Common
Stock under the Exchange Act nor has the Company received any notification that the Commission is contemplating terminating such registration.
Except as disclosed in the SEC Reports, the Company has not, in the 12 months preceding the date hereof, received notice from any Trading
Market on which the Common Stock is or has been listed or quoted to the effect that the Company is not in compliance with the listing
or maintenance requirements of such Trading Market. The Common Stock is currently eligible for electronic transfer through the Depository
Trust Company or another established clearing corporation and the Company is current in payment of the fees to the Depository Trust Company
(or such other established clearing corporation) in connection with such electronic transfer.
(y) Application
of Takeover Protections. Assuming the accuracy of the representations and warranties of Purchasers in Section 3.2(h), the Company
and the Board of Directors have taken all necessary action, if any, in order to render inapplicable any control share acquisition, business
combination, poison pill (including any distribution under a rights agreement) or other similar anti-takeover provision under the Company’s
certificate of incorporation (or similar charter documents) or the laws of its state of incorporation that is or could become applicable
to the Purchasers as a result of the Purchasers and the Company fulfilling their obligations or exercising their rights under the Transaction
Documents, including without limitation as a result of the Company’s issuance of the Securities and the Purchasers’ ownership
of the Securities.
(z) Disclosure.
Except with respect to the material terms and conditions of the transactions contemplated by the Transaction Documents, the Company confirms
that neither it nor any other Person acting on its behalf has provided any of the Purchasers or their agents or counsel with any information
that it believes constitutes or might constitute material, non-public information for purposes of U.S. federal securities laws. The Company
understands and confirms that the Purchasers will rely on the foregoing representation in effecting transactions in securities of the
Company. All of the disclosure furnished by or on behalf of the Company to the Purchasers regarding the Company and its Subsidiaries,
their respective businesses and the transactions contemplated hereby, is true and correct in all material respects and does not contain
any untrue statement of a material fact or omit to state any material fact necessary in order to make the statements made therein, in
the light of the circumstances under which they were made and when made, not misleading. The press releases disseminated by the Company
during the twelve months preceding the date of this Agreement taken as a whole do not contain any untrue statement of a material fact
or omit to state a material fact required to be stated therein or necessary in order to make the statements therein, in the light of the
circumstances under which they were made and when made, not misleading. The Company acknowledges and agrees that no Purchaser makes or
has made any representations or warranties with respect to the transactions contemplated hereby other than those specifically set forth
in Section 3.2 hereof.
(aa) No Integrated
Offering. Assuming the accuracy of the Purchasers’ representations and warranties set forth in Section 3.2, neither the Company,
nor any of its Affiliates, nor any Person acting on its or their behalf has, directly or indirectly, made any offers or sales of any security
or solicited any offers to buy any security, under circumstances that would cause this offering of the Securities to be integrated with
prior offerings by the Company for purposes of (i) the Securities Act which would require the registration of any such securities under
the Securities Act, or (ii) any applicable shareholder approval provisions of any Trading Market on which any of the securities of the
Company are listed or designated.
(bb) Solvency.
Based on the consolidated financial condition of the Company as of the Closing Date, after giving effect to the receipt by the Company
of the proceeds from the sale of the Securities hereunder, (i) the fair saleable value of the Company’s assets exceeds the amount
that will be required to be paid on or in respect of the Company’s existing debts and other liabilities (including known contingent
liabilities) as they mature, (ii) the Company’s assets do not constitute unreasonably small capital to carry on its business as
now conducted and as proposed to be conducted including its capital needs taking into account the particular capital requirements of the
business conducted by the Company, consolidated and projected capital requirements and capital availability thereof, and (iii) the current
cash flow of the Company, together with the proceeds the Company would receive, were it to liquidate all of its assets (at the carrying
value of such assets in the SEC Reports), after taking into account all anticipated uses of the cash, would be sufficient to pay all amounts
on or in respect of its liabilities when such amounts are required to be paid. The Company does not intend to incur debts beyond its ability
to pay such debts as they mature (taking into account the timing and amounts of cash to be payable on or in respect of its debt). The
Company has no knowledge of any facts or circumstances which lead it to believe that it will file for reorganization or liquidation under
the bankruptcy or reorganization laws of any jurisdiction within one year from the Closing Date. This representation and warranty is expressly
qualified and limited by the going concern qualification expressed by the Company’s auditors in their opinions pertaining to any
of the Company’s financial statements and related disclosure in the Company’s SEC Reports filed subsequent to such period.
(cc) Tax Status.
Except for matters that would not, individually or in the aggregate, have or reasonably be expected to result in a Material Adverse
Effect, the Company and its Subsidiaries each (i) has made or filed all United States federal, state and local income and all foreign
income and franchise tax returns, reports and declarations required by any jurisdiction to which it is subject, (ii) has paid all taxes
and other governmental assessments and charges that are material in amount, shown or determined to be due on such returns, reports and
declarations and (iii) has set aside on its books provision reasonably adequate for the payment of all material taxes for periods subsequent
to the periods to which such returns, reports or declarations apply. There are no unpaid taxes in any material amount claimed to be due
by the taxing authority of any jurisdiction, and the officers of the Company or of any Subsidiary know of no basis for any such claim.
(dd) No General
Solicitation. Neither the Company nor any Person acting on behalf of the Company has offered or sold any of the Securities by any
form of general solicitation or general advertising. The Company has offered the Securities for sale only to the Purchasers and certain
other “accredited investors” within the meaning of Rule 501 under the Securities Act.
(ee) Foreign
Corrupt Practices. Neither the Company nor any Subsidiary, nor to the knowledge of the Company or any Subsidiary, any agent or other
person acting on behalf of the Company or any Subsidiary, has (i) directly or indirectly, used any funds for unlawful contributions, gifts,
entertainment or other unlawful expenses related to foreign or domestic political activity, (ii) made any unlawful payment to foreign
or domestic government officials or employees or to any foreign or domestic political parties or campaigns from corporate funds, (iii)
failed to disclose fully any contribution made by the Company or any Subsidiary (or made by any person acting on its behalf of which the
Company is aware) which is in violation of law or (iv) violated in any material respect any provision of FCPA.
(ff) Accountants.
To the knowledge and belief of the Company, the Company’s accounting firm (i) is a registered public accounting firm as required
by the Exchange Act and (ii) shall express its opinion with respect to the financial statements to be included in the Company’s
Annual Report for the fiscal year ending December 31, 2024.
(gg) Seniority.
As of the Closing Date, no Indebtedness or other claim against the Company is senior to the Notes in right of payment or security, whether
with respect to interest or upon liquidation or dissolution, or otherwise, other than indebtedness secured by purchase money security
interests (which is senior only as to underlying assets covered thereby) and capital lease obligations (which is senior only as to the
property covered thereby). The Notes and all other obligations of the Company of any kind whatsoever under or in respect of the Notes
(the “Senior Obligations”) constitute senior unsubordinated obligations of the Company, other than any obligations
which have priority under applicable law.
(hh) No Disagreements
with Accountants and Lawyers. There are no disagreements of any kind presently existing, or reasonably anticipated by the Company
to arise, between the Company and the accountants and lawyers formerly or presently employed by the Company and the Company is current
with respect to any fees owed to its accountants and lawyers which could affect the Company’s ability to perform any of its obligations
under any of the Transaction Documents.
(ii) Acknowledgment
Regarding Purchasers’ Purchase of Securities. The Company acknowledges and agrees that each of the Purchasers is acting solely
in the capacity of an arm’s length purchaser with respect to the Transaction Documents and the transactions contemplated thereby.
The Company further acknowledges that no Purchaser is acting as a financial advisor or fiduciary of the Company (or in any similar capacity)
with respect to the Transaction Documents and the transactions contemplated thereby and any advice given by any Purchaser or any of their
respective representatives or agents in connection with the Transaction Documents and the transactions contemplated thereby is merely
incidental to the Purchasers’ purchase of the Securities. The Company further represents to each Purchaser that the Company’s
decision to enter into this Agreement and the other Transaction Documents has been based solely on the independent evaluation of the transactions
contemplated hereby by the Company and its representatives.
(jj) Acknowledgment
Regarding Purchaser’s Trading Activity. Anything in this Agreement or elsewhere herein to the contrary notwithstanding (except
for Sections 3.2(g) and 4.14 hereof), it is understood and acknowledged by the Company that: (i) none of the Purchasers has been asked
by the Company to agree, nor has any Purchaser agreed, to desist from purchasing or selling, long and/or short, securities of the Company,
or “derivative” securities based on securities issued by the Company or to hold the Securities for any specified term, (ii)
past or future open market or other transactions by any Purchaser, specifically including, without limitation, Short Sales or “derivative”
transactions, before or after the closing of this or future private placement transactions, may negatively impact the market price of
the Company’s publicly-traded securities, (iii) any Purchaser, and counter-parties in “derivative” transactions to which
any such Purchaser is a party, directly or indirectly, may presently have a “short” position in the Common Stock and (iv)
each Purchaser shall not be deemed to have any affiliation with or control over any arm’s length counter-party in any “derivative”
transaction. The Company further understands and acknowledges that (y) one or more Purchasers may engage in hedging activities at various
times during the period that the Securities are outstanding, including, without limitation, during the periods that the value of the Warrant
Shares deliverable with respect to Securities are being determined, and (z) such hedging activities (if any) could reduce the value of
the existing stockholders’ equity interests in the Company at and after the time that the hedging activities are being conducted.
The Company acknowledges that such aforementioned hedging activities do not constitute a breach of any of the Transaction Documents.
(kk) Regulation
M Compliance. The Company has not, and to its knowledge no one acting on its behalf has, (i) taken, directly or indirectly,
any action designed to cause or to result in the stabilization or manipulation of the price of any security of the Company to facilitate
the sale or resale of any of the Securities, (ii) sold, bid for, purchased, or paid any compensation for soliciting purchases of, any
of the Securities, or (iii) paid or agreed to pay to any Person any compensation for soliciting another to purchase any other securities
of the Company, other than, in the case of clauses (ii) and (iii).
(ll) Stock
Option Plans. Each stock option granted by the Company under the Company’s stock award plan was granted (i) in accordance with
the terms of the Company’s stock award plan and (ii) with an exercise price at least equal to the fair market value of the Common
Stock on the date such stock option would be considered granted under GAAP and applicable law. No stock option granted under the Company’s
stock award plan has been backdated. The Company has not knowingly granted, and there is no and has been no Company policy or practice
to knowingly grant, stock options prior to, or otherwise knowingly coordinate the grant of stock options with, the release or other public
announcement of material information regarding the Company or its Subsidiaries or their financial results or prospects.
(mm) IT Systems;
Data Privacy and Security. The information technology and computer systems, including the software, firmware, hardware, equipment,
networks, data communication lines, interfaces, databases, storage media, websites, platforms and related systems, owned, licensed or
leased by the Company and its Subsidiaries (collectively, “IT Systems”) are sufficient in all material respects for
the conduct of each of the business of the Company and its Subsidiaries, and to the knowledge of each of the Company and its Subsidiaries,
do not contain any “viruses”, “worms”, “time-bombs”, “key-locks”, or any other devices
intentionally designed to disrupt or interfere with the operation of any of the IT Systems; and during the last two (2) years, there have
been no material failures, breakdowns, continued substandard performance or other adverse events affecting any of the IT Systems. Each
of the Company and its Subsidiaries has and maintains commercially reasonable business continuity and disaster recovery plans, procedures
and facilities appropriate for its business and has taken commercially reasonable steps to safeguard the integrity and security of IT
Systems, including all data stored therein, and to the knowledge of each of the Company and its Subsidiaries, there has been no unauthorized
access, or any intrusions or breaches, of any of the IT Systems, including any data stored therein, during the last two (2) years. Each
of the Company and its Subsidiaries is, and during the last three (3) years has been, in compliance in all material respects with all
Data Privacy and Security Laws applicable to it. Each of the Company and its Subsidiaries has maintained and posted, and complied with
the terms of, all privacy notices pursuant to Data Privacy and Security Laws. Each of the Company and its Subsidiaries has commercially
reasonable security measures in place designed to protect all Personal Data under its control or in its possession from unauthorized use,
access, modification or destruction. During the last three (3) years, none of the Company nor its Subsidiaries has suffered any breach
in security or other incident that has permitted any unauthorized access to the Personal Data under its control or possession. Each of
the Company and its Subsidiaries maintains, and has remained in compliance, in all material respects, with, a comprehensive written information
security program that includes commercially reasonable administrative, physical and technical measures intended to protect the confidentiality,
integrity, availability and security of Personal Data in is possession or under its control and IT Systems against any unauthorized control,
use, access, interruption, modification or corruption and to ensure the continued, uninterrupted and error-free operation of IT Systems.
There are no material claims, actions or proceedings against or affecting any of the Company or its Subsidiaries pending, threatened in
writing, relating to or arising under Data Privacy and Security Laws. None of the Company nor its Subsidiaries has received any written
notices from the Department of Justice, U.S. Department of Education, Federal Trade Commission, or the Attorney General of any state,
or any equivalent foreign governmental authority, relating to possible violations of Data Privacy and Security Laws. For purposes of this
Agreement, (i) “Data Privacy and Security Laws” shall mean (a) all applicable laws relating to the Processing of Personal
Data or otherwise relating to privacy, data protection, data security, cyber security, breach notification or data localization, and (b)
all published policies of the Company and its Subsidiaries relating to the Processing of Personal Data or otherwise relating to privacy,
data protection, data security, cyber security, breach notification or data localization; (ii) “Processing” shall mean
the collection, use, storage, processing, recording, distribution, transfer, import, export, protection, disposal or disclosure or other
activity regarding or operations performed on data or information (whether electronically or in any other form or medium); and (iii) “Personal
Data” shall mean any information that, alone or in combination with other information held by the Company and its Subsidiaries,
identifies or could reasonably be associated with an individual, including any individual’s name, street address, telephone number,
e-mail address, photograph, social security number, driver’s license number, passport number, customer or account number, biometrics,
IP address, geolocation data or persistent device identifier, or any other information that is otherwise considered personal information,
personal data, protected health information by applicable Data Privacy and Security Laws.
(nn) Office
of Foreign Assets Control. Neither the Company nor any Subsidiary nor, to the Company’s knowledge, any director, officer, agent,
employee or affiliate of the Company or any Subsidiary is currently subject to any U.S. sanctions administered by the Office of Foreign
Assets Control of the U.S. Treasury Department (“OFAC”).
(oo) U.S.
Real Property Holding Corporation. The Company is not and has never been a U.S. real property holding corporation within the meaning
of Section 897 of the Internal Revenue Code of 1986, as amended, and the Company shall so certify upon Purchaser’s request.
(pp) Bank
Holding Company Act. Neither the Company nor any of its Subsidiaries or Affiliates is subject to the Bank Holding Company Act of 1956,
as amended (the “BHCA”) and to regulation by the Board of Governors of the Federal Reserve System (the “Federal
Reserve”). Neither the Company nor any of its Subsidiaries or Affiliates owns or controls, directly or indirectly, five percent
(5%) or more of the outstanding shares of any class of voting securities or twenty-five percent or more of the total equity of a bank
or any entity that is subject to the BHCA and to regulation by the Federal Reserve. Neither the Company nor any of its Subsidiaries or
Affiliates exercises a controlling influence over the management or policies of a bank or any entity that is subject to the BHCA and to
regulation by the Federal Reserve.
(qq) Money
Laundering. The operations of the Company and its Subsidiaries are and have been conducted at all times in compliance with applicable
financial record-keeping and reporting requirements of the Currency and Foreign Transactions Reporting Act of 1970, as amended, applicable
money laundering statutes and applicable rules and regulations thereunder (collectively, the “Money Laundering Laws”),
and no Action or Proceeding by or before any court or governmental agency, authority or body or any arbitrator involving the Company or
any Subsidiary with respect to the Money Laundering Laws is pending or, to the knowledge of the Company or any Subsidiary, threatened.
(rr) No Disqualification
Events. With respect to the Securities to be offered and sold hereunder in reliance on Rule 506 under the Securities Act, none of
the Company, any of its predecessors, any affiliated issuer, any director, executive officer, other officer of the Company participating
in the offering hereunder, any beneficial owner of 20% or more of the Company’s outstanding voting equity securities, calculated
on the basis of voting power, nor any promoter (as that term is defined in Rule 405 under the Securities Act) connected with the Company
in any capacity at the time of sale (each, an “Issuer Covered Person” and, together, “Issuer Covered Persons”)
is subject to any of the “Bad Actor” disqualifications described in Rule 506(d)(1)(i) to (viii) under the Securities Act (a
“Disqualification Event”), except for a Disqualification Event covered by Rule 506(d)(2) or (d)(3). The Company has
exercised reasonable care to determine whether any Issuer Covered Person is subject to a Disqualification Event. The Company has complied,
to the extent applicable, with its disclosure obligations under Rule 506(e), and has furnished to the Purchasers a copy of any disclosures
provided thereunder.
(ss) Other
Covered Persons. The Company is not aware of any person (other than any Issuer Covered Person) that has been or will be paid (directly
or indirectly) remuneration for solicitation of purchasers in connection with the sale of any Securities.
(tt) Notice
of Disqualification Events. The Company will notify the Purchasers in writing, prior to the Closing Date of (i) any Disqualification
Event relating to any Issuer Covered Person and (ii) any event that would, with the passage of time, become a Disqualification Event relating
to any Issuer Covered Person.
(uu) Shell Company Status.
The Company is not, and has never been, an issuer identified in, or subject to, Rule 144(i)(1) of the Securities Act.
3.2 Representations
and Warranties of the Purchasers. Each Purchaser, for itself and for no other Purchaser, hereby represents and warrants as of the
date hereof and as of the Closing Date to the Company as follows (unless as of a specific date therein, in which case they shall be accurate
as of such date):
(a) Organization;
Authority. Such Purchaser is either an individual or an entity duly incorporated or formed, validly existing and in good standing
under the laws of the jurisdiction of its incorporation or formation with full right, corporate, partnership, limited liability company
or similar power and authority to enter into and to consummate the transactions contemplated by the Transaction Documents and otherwise
to carry out its obligations hereunder and thereunder. The execution and delivery of the Transaction Documents and performance by such
Purchaser of the transactions contemplated by the Transaction Documents have been duly authorized by all necessary corporate, partnership,
limited liability company or similar action, as applicable, on the part of such Purchaser. Each Transaction Document to which it is a
party has been duly executed by such Purchaser, and when delivered by such Purchaser in accordance with the terms hereof, will constitute
the valid and legally binding obligation of such Purchaser, enforceable against it in accordance with its terms, except (i) as limited
by general equitable principles and applicable bankruptcy, insolvency, reorganization, moratorium and other laws of general application
affecting enforcement of creditors’ rights generally, (ii) as limited by laws relating to the availability of specific performance,
injunctive relief or other equitable remedies or (iii) insofar as indemnification and contribution provisions may be limited by applicable
law.
(b) Own
Account. Such Purchaser understands that the Securities are “restricted securities” and have not been registered under
the Securities Act or any applicable state securities law and is acquiring the Securities as principal for its own account and not with
a view to or for distributing or reselling such Securities or any part thereof in violation of the Securities Act or any applicable state
securities law, has no present intention of distributing any of such Securities in violation of the Securities Act or any applicable state
securities law and has no direct or indirect arrangement or understandings with any other persons to distribute or regarding the distribution
of such Securities in violation of the Securities Act or any applicable state securities law (this representation and warranty not limiting
such Purchaser’s right to sell the Securities pursuant to a registration statement, or otherwise in compliance with applicable federal
and state securities laws). Such Purchaser is acquiring the Securities hereunder in the ordinary course of its business.
(c) Purchaser
Status. At the time such Purchaser was offered the Securities, it was, and as of the date hereof it is, an “accredited investor”
as defined in Rule 501(a)(1), (a)(2), (a)(3), (a)(7), (a)(8), (a)(9), (a)(12) or (a)(13) under the Securities Act.
(d) Experience
of Such Purchaser. Such Purchaser, either alone or together with its representatives, has such knowledge, sophistication and experience
in business and financial matters so as to be capable of evaluating the merits and risks of the prospective investment in the Securities,
and has so evaluated the merits and risks of such investment. Such Purchaser is able to bear the economic risk of an investment in the
Securities and, at the present time, is able to afford a complete loss of such investment.
(e) General
Solicitation. Such Purchaser is not, to such Purchaser’s knowledge, purchasing the Securities as a result of any advertisement,
article, notice or other communication regarding the Securities published in any newspaper, magazine or similar media or broadcast over
television or radio or presented at any seminar or, to the knowledge of such Purchaser, any other general solicitation or general advertisement.
(f) Access
to Information. Such Purchaser acknowledges that it has had the opportunity to review the Transaction Documents (including all exhibits
and schedules thereto) and the SEC Reports and has been afforded (i) the opportunity to ask such questions as it has deemed necessary
of, and to receive answers from, representatives of the Company concerning the terms and conditions of the offering of the Securities
and the merits and risks of investing in the Securities; (ii) access to information about the Company and its financial condition, results
of operations, business, properties, management and prospects sufficient to enable it to evaluate its investment; and (iii) the opportunity
to obtain such additional information that the Company possesses or can acquire without unreasonable effort or expense that is necessary
to make an informed investment decision with respect to the investment.
(g) Certain
Transactions and Confidentiality. Other than consummating the transactions contemplated hereunder, such Purchaser has not, nor has
any Person acting on behalf of or pursuant to any understanding with such Purchaser, directly or indirectly executed any purchases or
sales, including Short Sales, of the securities of the Company during the period commencing as of the time that such Purchaser first
received a term sheet (written or oral) from the Company or any other Person representing the Company setting forth the material terms
of the transactions contemplated hereunder and ending immediately prior to the execution hereof. Notwithstanding the foregoing, in the
case of a Purchaser that is a multi-managed investment vehicle whereby separate portfolio managers manage separate portions of such Purchaser’s
assets and the portfolio managers have no direct knowledge of the investment decisions made by the portfolio managers managing other portions
of such Purchaser’s assets, the representation set forth above shall only apply with respect to the portion of assets managed by
the portfolio manager that made the investment decision to purchase the Securities covered by this Agreement. Other than to other Persons
party to this Agreement or to such Purchaser’s representatives, including, without limitation, its officers, directors, partners,
legal and other advisors, employees, agents and Affiliates, such Purchaser has maintained the confidentiality of all disclosures made
to it in connection with this transaction (including the existence and terms of this transaction). Notwithstanding the foregoing, for
the avoidance of doubt, nothing contained herein shall constitute a representation or warranty against, or a prohibition of, any actions
with respect to the borrowing of, arrangement to borrow, identification of the availability of, and/or securing of, securities of the
Company in order for such Purchaser (or its broker or other financial representative) to effect Short Sales or similar transactions in
the future.
The Company acknowledges and agrees that the representations
contained in this Section 3.2 shall not modify, amend or affect such Purchaser’s right to rely on the Company’s representations
and warranties contained in this Agreement or any representations and warranties contained in any other Transaction Document or any other
document or instrument executed and/or delivered in connection with this Agreement or the consummation of the transactions contemplated
hereby. Notwithstanding the foregoing, for the avoidance of doubt, nothing contained herein shall constitute a representation or warranty,
or preclude any actions, with respect to locating or borrowing shares in order to effect Short Sales or similar transactions in the future.
ARTICLE IV.
OTHER AGREEMENTS OF THE PARTIES
4.1 Transfer
Restrictions.
(a) The
Securities may only be disposed of in compliance with state and federal securities laws. In connection with any transfer of Securities
other than pursuant to an effective registration statement or Rule 144, to the Company or to an Affiliate of a Purchaser or in connection
with a pledge as contemplated in Section 4.1(b), the Company may require the transferor thereof to provide to the Company an opinion of
counsel selected by the transferor and reasonably acceptable to the Company, the form and substance of which opinion shall be reasonably
satisfactory to the Company, to the effect that such transfer does not require registration of such transferred Securities under the Securities
Act. As a condition of transfer, any such transferee shall agree in writing to be bound by the terms of this Agreement and shall have
the rights and obligations of a Purchaser under this Agreement.
(b) The
Purchasers agree to the imprinting, so long as is required by this Section 4.1, of a legend on any of the Securities in substantially
the following form:
[NEITHER] THIS SECURITY [NOR THE SECURITIES
INTO WHICH THIS SECURITY IS [EXERCISABLE] HAS [NOT] BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION OR THE SECURITIES COMMISSION
OF ANY STATE IN RELIANCE UPON AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”),
AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR PURSUANT
TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND IN ACCORDANCE
WITH APPLICABLE STATE SECURITIES LAWS. THIS SECURITY [AND THE SECURITIES ISSUABLE UPON [EXERCISE] OF THIS SECURITY] MAY BE PLEDGED IN
CONNECTION WITH A BONA FIDE MARGIN ACCOUNT WITH A REGISTERED BROKER-DEALER OR OTHER LOAN WITH A FINANCIAL INSTITUTION THAT IS AN “ACCREDITED
INVESTOR” AS DEFINED IN RULE 501(a) UNDER THE SECURITIES ACT OR OTHER LOAN SECURED BY SUCH SECURITIES.
The Company acknowledges
and agrees that a Purchaser may from time to time pledge pursuant to a bona fide margin agreement with a registered broker-dealer or grant
a security interest in some or all of the Securities to a financial institution that is an “accredited investor” as defined
in Rule 501(a) under the Securities Act and, if required under the terms of such arrangement, such Purchaser may transfer pledged or secured
Securities to the pledgees or secured parties. Such a pledge or transfer would not be subject to approval of the Company and no legal
opinion of legal counsel of the pledgee, secured party or pledgor shall be required in connection therewith. Further, no notice shall
be required of such pledge. At the appropriate Purchaser’s expense, the Company will execute and deliver such reasonable documentation
as a pledgee or secured party of Securities may reasonably request in connection with a pledge or transfer of the Securities, including,
if the Securities are subject to registration, the preparation and filing of any required prospectus supplement under Rule 424(b)(3) under
the Securities Act or other applicable provision of the Securities Act to appropriately amend the list of selling stockholders thereunder.
(c) Certificates
evidencing the Warrant Shares shall not contain any legend (including the legend set forth in Section 4.1(b) hereof): (i) while a registration
statement covering the resale of such security is effective under the Securities Act, (ii) following any sale of such Warrant Shares pursuant
to Rule 144, (iii) if such Warrant Shares are eligible for sale under Rule 144, without the volume or manner-of-sale restrictions or (iv)
if such legend is not required under applicable requirements of the Securities Act (including judicial interpretations and pronouncements
issued by the staff of the Commission). The Company shall cause its counsel to issue a legal opinion to the Transfer Agent or the Purchaser
promptly after such time as such legend is no longer required under this Section 4.1(c), and in any event within such time as to enable
the Transfer Agent to remove the legend hereunder by the Legend Removal Date, if required by the Transfer Agent to effect the removal
of the legend hereunder, or if requested by a Purchaser, respectively. The Company agrees that at such time as such legend is no longer
required under this Section 4.1(c), it will, no later than the earlier of (i) one (1) Trading Days and (ii) the number of Trading Days
comprising the Standard Settlement Period following the delivery by a Purchaser to the Company or the Transfer Agent of a certificate
representing Warrant 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 Warrant 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 Warrant 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 Warrant 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©, $10 per Trading Day
(increasing to $20 per Trading Day five (5) Trading Days after such damages have begun to accrue) for each Trading Day after the Legend
Removal Date until such certificate is delivered without a legend to the extent permitted by Section 4.1(c) above and (ii) if the Company
fails to (a) issue and deliver (or cause to be delivered) to a Purchaser by the Legend Removal Date a certificate representing the Securities
so delivered to the Company by such Purchaser that is free from all restrictive and other legends and (b) if after the Legend Removal
Date such Purchaser purchases (in an open market transaction or otherwise) shares of Common Stock to deliver in satisfaction of a sale
by such Purchaser of all or any portion of the number of shares of Common Stock, or a sale of a number of shares of Common Stock equal
to all or any portion of the number of shares of Common Stock that such Purchaser anticipated receiving from the Company without any restrictive
legend, then, an amount equal to the excess of such Purchaser’s total purchase price (including brokerage commissions and other
out-of-pocket expenses, if any) for the shares of Common Stock so purchased (including brokerage commissions and other out-of-pocket expenses,
if any) over the product of (A) such number of Shares that the Company was required to deliver to such Purchaser by the Legend Removal
Date multiplied by (B) the lowest closing sale price of the Common Stock on any Trading Day during the period commencing on the date of
the delivery by such Purchaser to the Company of the applicable Warrant 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 Warrant Shares pursuant to the Transaction Documents,
are unconditional and absolute and not subject to any right of set off, counterclaim, delay or reduction, regardless of the effect of
any such dilution or any claim the Company may have against any Purchaser and regardless of the dilutive effect that such issuance may
have on the ownership of the other stockholders of the Company.
4.3 Furnishing
of Information; Public Information.
(a) Until
the earlier of the time that no Purchaser owns Securities, the Company covenants to maintain the registration of the Common Stock under
Section 12(b) or 12(g) of the Exchange Act and to use reasonable best efforts to timely file (or obtain extensions in respect thereof
and file within the applicable grace period) all reports required to be filed by the Company after the date hereof pursuant to the Exchange
Act even if the Company is not then subject to the reporting requirements of the Exchange Act.
(b) At
any time during the period commencing from the six (6) month anniversary of the date hereof and ending at such time that all of the Securities
may be sold without the requirement for the Company to be in compliance with Rule 144(c)(1) and otherwise without restriction or limitation
pursuant to Rule 144, if the Company (i) shall fail for any reason to satisfy the current public information requirement under Rule 144(c)
or (ii) has ever been an issuer described in Rule 144 (i)(1)(i) or becomes an issuer in the future, and the Company shall fail to satisfy
any condition set forth in Rule 144(i)(2) (a “Public Information Failure”) then, in addition to such Purchaser’s
other available remedies, the Company shall pay to a Purchaser, in cash, as partial liquidated damages and not as a penalty, by reason
of any such delay in or reduction of its ability to sell the Securities, an amount in cash equal to two percent (2.0%) of the aggregate
Subscription Amount of such Purchaser’s Securities on the 10th day following a Public Information Failure which remains
uncured as of such date and on every thirtieth (30th) day thereafter (pro rated for periods totaling less than thirty days)
thereafter until the earlier of (a) the date such Public Information Failure is cured and (b) such time that such public information is
no longer required for the Purchasers to transfer the Warrant Shares pursuant to Rule 144. The payments to which a Purchaser shall
be entitled pursuant to this Section 4.3(b) are referred to herein as “Public Information Failure Payments.”
Public Information Failure Payments shall be paid on the earlier of (i) the last day of the calendar month during which such Public Information
Failure Payments are incurred and (ii) the third (3rd) Business Day after the event or failure giving rise to the Public Information
Failure Payments is cured. In the event the Company fails to make Public Information Failure Payments in a timely manner, such Public
Information Failure Payments shall bear interest at the rate of 1.5% per month (prorated for partial months) until paid in full. Nothing
herein shall limit such Purchaser’s right to pursue actual damages for the Public Information Failure, and such Purchaser shall
have the right to pursue all remedies available to it at law or in equity including, without limitation, a decree of specific performance
and/or injunctive relief.
4.4 Integration.
The Company shall not sell, offer for sale or solicit offers to buy or otherwise negotiate in respect of any security (as defined in Section
2 of the Securities Act) that would be integrated with the offer or sale of the Securities in a manner that would require the registration
under the Securities Act of the sale of the Securities or that would be integrated with the offer or sale of the Securities for purposes
of the rules and regulations of any Trading Market such that it would require shareholder approval prior to the closing of such other
transaction unless shareholder approval is obtained before the closing of such subsequent transaction.
4.5 Securities
Laws Disclosure; Publicity. The Company shall (a) by the Disclosure Time, issue a press release disclosing the material terms of the
transactions contemplated hereby, and (b) file a Current Report on Form 8-K, including the Transaction Documents as exhibits thereto,
with the Commission within the time required by the Exchange Act. From and after the issuance of such press release, the Company represents
to the Purchasers that it shall have publicly disclosed all material, non-public information delivered to any of the Purchasers by the
Company or any of its Subsidiaries, or any of their respective officers, directors, employees, Affiliates or agents, in connection with
the transactions contemplated by the Transaction Documents. In addition, effective upon the issuance of such press release, the Company
acknowledges and agrees that any and all confidentiality or similar obligations under any agreement, whether written or oral, between
the Company, any of its Subsidiaries or any of their respective officers, directors, agents, employees, Affiliates or agents shall terminate
and be of no further force or effect. The Company understands and confirms that each Purchaser shall be relying on the foregoing covenant
in effecting transactions in securities of the Company. The Company and each Purchaser shall consult with each other in issuing any other
press releases with respect to the transactions contemplated hereby, and neither the Company nor any Purchaser shall issue any such press
release nor otherwise make any such public statement without the prior consent of the Company, with respect to any press release of any
Purchaser, or without the prior consent of each Purchaser, with respect to any press release of the Company, which consent shall not unreasonably
be withheld or delayed, except if such disclosure is required by law, in which case the disclosing party shall promptly provide the other
party with prior notice of such public statement or communication. Notwithstanding the foregoing, the Company shall not publicly disclose
the name of any Purchaser, or include the name of any Purchaser in any filing with the Commission or any regulatory agency or Trading
Market, without the prior written consent of such Purchaser, except (a) as required by federal securities law or rule or form promulgated
thereunder in connection with the filing of final Transaction Documents with the Commission and (b) to the extent such disclosure is required
by law or rule or form promulgated thereunder or Trading Market regulations, in which case the Company shall provide the Purchasers with
prior notice of such disclosure permitted under this clause (b) and reasonably cooperate with such Purchaser regarding such disclosure.
4.6 Shareholder
Rights Plan. No claim will be made or enforced by the Company or, with the consent of the Company, any other Person, that any Purchaser
is an “Acquiring Person” under any control share acquisition, business combination, poison pill (including any distribution
under a rights agreement) or similar anti-takeover plan or arrangement in effect or hereafter adopted by the Company, or that any Purchaser
could be deemed to trigger the provisions of any such plan or arrangement, by virtue of receiving Securities under the Transaction Documents
or under any other agreement between the Company and the Purchasers.
4.7 Non-Public
Information. Except with respect to the material terms and conditions of the transactions contemplated by the Transaction Documents,
which shall be disclosed pursuant to Section 4.6, the Company covenants and agrees that neither it, nor any other Person acting on its
behalf will provide any Purchaser or its agents or counsel with any information that constitutes, or the Company reasonably believes constitutes,
material non-public information, unless prior thereto such Purchaser shall have consented in writing to the receipt of such information
and agreed in writing with the Company to keep such information confidential. The Company understands and confirms that each Purchaser
shall be relying on the foregoing covenant in effecting transactions in securities of the Company. To the extent that the Company, any
of its Subsidiaries, or any of their respective officers, director, agents, employees or Affiliates delivers any material, non-public
information to a Purchaser without such Purchaser’s consent, the Company hereby covenants and agrees that such Purchaser shall not
have any duty of confidentiality to the Company, any of its Subsidiaries, or any of their respective officers, directors, employees, Affiliates
or agents, or a duty to the Company, any of its Subsidiaries or any of their respective officers, directors, employees, Affiliates or
agents not to trade on the basis of, such material, non-public information, provided that the Purchaser shall remain subject to applicable
law. To the extent that any notice provided pursuant to any Transaction Document constitutes, or contains, material, non-public information
regarding the Company or any Subsidiaries, unless the Purchaser has consented in writing to the receipt of such material non-public information,
the Company shall simultaneously with the delivery of such notice file such notice with the Commission pursuant to a Current Report on
Form 8-K. The Company understands and confirms that each Purchaser shall be relying on the foregoing covenant in effecting transactions
in securities of the Company.
4.8 Use
of Proceeds. The Company shall use the net proceeds from the sale of the Securities hereunder for working capital purposes and shall
not use such proceeds in violation of FCPA or OFAC regulations.
4.9 Indemnification
of Purchasers. Subject to the provisions of this Section 4.10, the Company will indemnify and hold each Purchaser and its directors,
officers, shareholders, members, partners, employees and agents (and any other Persons with a functionally equivalent role of a Person
holding such titles notwithstanding a lack of such title or any other title), each Person who controls such Purchaser (within the meaning
of Section 15 of the Securities Act and Section 20 of the Exchange Act), and the directors, officers, shareholders, agents, members, partners
or employees (and any other Persons with a functionally equivalent role of a Person holding such titles notwithstanding a lack of such
title or any other title) of such controlling persons (each, a “Purchaser Party”) harmless from any and all losses,
liabilities, obligations, claims, contingencies, damages, costs and expenses, including all judgments, amounts paid in settlements, court
costs and reasonable attorneys’ fees and costs of investigation that any such Purchaser Party may suffer or incur as a result of
or relating to (a) any breach of any of the representations, warranties, covenants or agreements made by the Company in this Agreement
or in the other Transaction Documents or (b) any action instituted against the Purchaser Parties in any capacity (including a Purchaser
Party’s status as an investor), or any of them or their respective Affiliates, by the Company or any stockholder of the Company
who is not an Affiliate of such Purchaser Party, arising out of or relating to any of the transactions contemplated by the Transaction
Documents. For the avoidance of doubt, the indemnification provided herein is intended to, and shall also cover, direct claims brought
by the Company against the Purchaser Parties; provided, however, that such indemnification shall not cover any loss, claim, damage or
liability to the extent it is finally judicially determined to be attributable to any Purchaser Party’s breach of any of the representations,
warranties, covenants or agreements made by such Purchaser Party in any Transaction Document or any conduct by a Purchaser Party which
is finally judicially determined to constitute fraud, gross negligence or willful misconduct. If any action shall be brought against any
Purchaser Party in respect of which indemnity may be sought pursuant to this Agreement, such Purchaser Party shall promptly notify the
Company in writing, and, except with respect to direct claims brought by the Company, the Company shall have the right to assume the defense
thereof with counsel of its own choosing reasonably acceptable to the Purchaser Party. Any Purchaser Party shall have the right to employ
separate counsel in any such action and participate in the defense thereof, but the fees and expenses of such counsel shall be at the
expense of such Purchaser Party except to the extent that (i) the employment thereof has been specifically authorized by the Company in
writing, (ii) the Company has failed after a reasonable period of time to assume such defense and to employ counsel or (iii) in such action
there is, in the reasonable opinion of counsel to the applicable Purchaser Party (which may be internal counsel), a material conflict
on any material issue between the position of the Company and the position of such Purchaser Party, in which case the Company shall be
responsible for the reasonable fees and expenses of no more than one such separate counsel. The Company will not be liable to any Purchaser
Party under this Agreement (y) for any settlement by a Purchaser Party effected without the Company’s prior written consent, which
shall not be unreasonably withheld or delayed; or (z) to the extent, but only to the extent that a loss, claim, damage or liability is
attributable to any Purchaser Party’s breach of any of the representations, warranties, covenants or agreements made by such Purchaser
Party in this Agreement or in the other Transaction Documents or any conduct by a Purchaser Party which is finally judicially determined
to constitute fraud, gross negligence or willful misconduct. In addition, if any Purchaser Party takes actions to collect amounts due
under any Transaction Documents or to enforce the provisions of any Transaction Documents, then the Company shall pay the costs incurred
by such Purchaser Party for such collection, enforcement or action, including, but not limited to, attorneys’ fees and disbursements.
The indemnification and other payment obligations required by this Section 4.10 shall be made by periodic payments of the amount thereof
during the course of the investigation, defense, collection, enforcement or action, as and when bills are received or are incurred; provided,
that if any Purchaser Party is finally judicially determined not to be entitled to indemnification or payment under this Section 4.10,
such Purchaser Party shall promptly reimburse the Company for any payments that are advanced under this sentence. The indemnity agreements
contained herein shall be in addition to any cause of action or similar right of any Purchaser Party against the Company or others and
any liabilities the Company may be subject to pursuant to law.
4.10 Reservation
and Listing of Securities.
(a) The
Company shall maintain a reserve of the Required Minimum from its duly authorized shares of Common Stock for issuance pursuant to the
Transaction Documents in such amount as may then be required to fulfill its obligations in full under the Transaction Documents.
(b) If,
on any date, the number of authorized but unissued (and otherwise unreserved) shares of Common Stock is less than the Required Minimum
on such date, then the Board of Directors shall use its reasonable efforts to amend the Company’s certificate or articles of incorporation
to increase the number of authorized but unissued shares of Common Stock to at least the Required Minimum at such time, as soon as possible
and in any event not later than the 60th day after such date.
(c) The
Company shall, if applicable: (i) in the time and manner required by the principal Trading Market, prepare and file with such Trading
Market an additional shares listing application covering a number of shares of Common Stock at least equal to the Required Minimum on
the date of such application, (ii) take all steps necessary to cause such shares of Common Stock to be approved for listing or quotation
on such Trading Market as soon as possible thereafter, (iii) provide to the Purchasers evidence of such listing or quotation and (iv)
maintain the listing or quotation of such Common Stock on any date at least equal to the Required Minimum on such date on such Trading
Market or another Trading Market. The Company agrees to maintain the eligibility of the Common Stock for electronic transfer through the
Depository Trust Company or another established clearing corporation, including, without limitation, by timely payment of fees to the
Depository Trust Company or such other established clearing corporation in connection with such electronic transfer.
4.11 Equal
Treatment of Purchasers. No consideration (including any modification of this Agreement but excluding the reimbursement of legal fees)
shall be offered or paid to any Person to amend or consent to a waiver or modification of any provision of this Agreement unless the same
consideration is also offered to all of the parties to this Agreement. Further, the Company shall not make any payment of principal or
interest on the Notes in amounts which are disproportionate to the respective principal amounts outstanding on the Notes at any applicable
time. For clarification purposes, this provision constitutes a separate right granted to each Purchaser by the Company and negotiated
separately by each Purchaser, and is intended for the Company to treat the Purchasers as a class and shall not in any way be construed
as the Purchasers acting in concert or as a group with respect to the purchase, disposition or voting of Securities or otherwise.
4.12 Certain
Transactions and Confidentiality. Each Purchaser, severally and not jointly with the other Purchasers, covenants that neither it,
nor any Affiliate acting on its behalf or pursuant to any understanding with it will execute any purchases or sales, including Short Sales,
of any of the Company’s securities during the period commencing with the execution of this Agreement and ending at such time that
the transactions contemplated by this Agreement are first publicly announced pursuant to the initial press release as described in Section
4.6. Each Purchaser, severally and not jointly with the other Purchasers, covenants that until such time as the transactions contemplated
by this Agreement are publicly disclosed by the Company pursuant to the initial press release as described in Section 4.6, such Purchaser
will maintain the confidentiality of the existence and terms of this transaction (other than as disclosed to its legal and other representatives).
Notwithstanding the foregoing, and notwithstanding anything contained in this Agreement to the contrary, the Company expressly acknowledges
and agrees that (i) no Purchaser makes any representation, warranty or covenant hereby that it will not engage in effecting transactions
in any securities of the Company after the time that the transactions contemplated by this Agreement are first publicly announced pursuant
to the initial press release as described in Section 4.6, (ii) no Purchaser shall be restricted or prohibited from effecting any transactions
in any securities of the Company in accordance with applicable securities laws from and after the time that the transactions contemplated
by this Agreement are first publicly announced pursuant to the initial press release as described in Section 4.6 and (iii) no Purchaser
shall have any duty of confidentiality or duty not to trade in the securities of the Company to the Company, any of its Subsidiaries,
or any of their respective officers, directors, employees, Affiliates or agent, after the issuance of the initial press release as described
in Section 4.6. Notwithstanding the foregoing, in the case of a Purchaser that is a multi-managed investment vehicle whereby separate
portfolio managers manage separate portions of such Purchaser’s assets and the portfolio managers have no direct knowledge of the
investment decisions made by the portfolio managers managing other portions of such Purchaser’s assets, the covenant set forth above
shall only apply with respect to the portion of assets managed by the portfolio manager that made the investment decision to purchase
the Securities covered by this Agreement.
4.13 Form
D; Blue Sky Filings. The Company agrees to timely file a Form D with respect to the Securities as required under Regulation D and
to provide a copy thereof, promptly upon request of any Purchaser. The Company shall take such action as the Company shall reasonably
determine is necessary in order to obtain an exemption for, or to qualify the Securities for, sale to the Purchasers at the Closing under
applicable securities or “Blue Sky” laws of the states of the United States, and shall provide evidence of such actions promptly
upon request of any Purchaser.
4.14 Capital
Raise. The Company shall use commercially reasonable efforts, including the filing of a registration statement with the Commission
for a public offering, to pursue and consummate a financing transaction within 90 days of the Closing Date.
4.15 Registration
Rights. As soon as practicable following written notice from a Purchaser (and in any event within 30 calendar days following such
notice), the Company shall file a registration statement on Form S-1 (or other appropriate form if the Company is not then S-1 eligible)
providing for the resale by the Purchasers of the Warrant Shares issued hereunder. The Company shall use commercially reasonable
efforts to cause such registration statement to become effective within 60 days following the filing thereof and to keep such registration
statement effective at all times until no Purchaser owns any Shares.
4.16 Stockholder
Approval. The Company shall provide each stockholder entitled to vote at a special meeting of stockholders of the Company (the “Stockholder
Meeting”), which shall be promptly called and held not later than November 8, 2024 (the “Stockholder Meeting Deadline”),
a proxy statement, which, shall solicit each of the Company’s stockholder’s affirmative vote at the Stockholder Meeting for
approval of resolutions (“Stockholder Resolutions”) providing for the approval of any matters requiring stockholder
approval pursuant to the listing requirements of the Principal Market including, without limitation the issuance of more than 20% of the
outstanding shares of Common Stock, in connection with the transactions contemplated hereby (such affirmative approval being referred
to herein as the “Stockholder Approval”, and the date such Stockholder Approval is obtained, the “Stockholder
Approval Date”), and the Company shall use its reasonable best efforts to set the record date for such Stockholder Meeting no
later than September 8, 2024 and solicit its stockholders’ approval of such resolutions and to cause the Board of Directors of the
Company to recommend to the stockholders that they approve such resolutions. The Company shall be obligated to seek to obtain the Stockholder
Approval by the Stockholder Meeting Deadline. If, despite the Company’s reasonable best efforts the Stockholder Approval is not
obtained on or prior to the Stockholder Meeting Deadline, the Company shall cause an additional Stockholder Meeting to be held on or prior
to June 30, 2025. If, despite the Company’s reasonable best efforts the Stockholder Approval is not obtained after such subsequent
stockholder meetings, the Company shall cause an additional Stockholder Meeting to be held semi-annually thereafter until such Stockholder
Approval is obtained.
ARTICLE V.
MISCELLANEOUS
5.1 Termination.
This Agreement may be terminated by any Purchaser, as to such Purchaser’s obligations hereunder only and without any effect whatsoever
on the obligations between the Company and the other Purchasers, by written notice to the other parties, if the Closing has not been consummated
on or before the fifth (5th) Trading Day following the date hereof, provided, however, that no such termination
will affect the right of any party to sue for any breach by any other party (or parties).
5.2 Fees
and Expenses. The Company shall be responsible for the payment of any placement agent’s fees, financial advisory fees, or broker’s
commissions (other than for Persons engaged by any Purchaser) relating to or arising out of the transactions contemplated hereby. The
Company shall pay, and hold each Purchaser harmless against, any liability, loss or expense (including, without limitation, reasonable
attorney’s fees and out-of-pocket expenses) arising in connection with any claim relating to any such payment. Except as expressly
set forth in the Transaction Documents to the contrary, each party shall pay the fees and expenses of its advisers, counsel, accountants
and other experts, if any, and all other expenses incurred by such party incident to the negotiation, preparation, execution, delivery
and performance of this Agreement. The Company shall pay all Transfer Agent fees (including, without limitation, any fees required for
same-day processing of any instruction letter delivered by the Company and any exercise notice delivered by a Purchaser), stamp taxes
and other taxes and duties levied in connection with the delivery of any Securities to the Purchasers.
5.3 Entire
Agreement. The Transaction Documents, together with the exhibits and schedules thereto, contain the entire understanding of the parties
with respect to the subject matter hereof and thereof and supersede all prior agreements and understandings, oral or written, with respect
to such matters, which the parties acknowledge have been merged into such documents, exhibits and schedules.
5.4 Notices.
Any and all notices or other communications or deliveries required or permitted to be provided hereunder shall be in writing and shall
be deemed given and effective on the earliest of: (a) the time of transmission, if such notice or communication is delivered via facsimile
at the facsimile number or email attachment at the email address as set forth on the signature pages attached hereto at or prior to 5:30
p.m. (New York City time) on a Trading Day, (b) the next Trading Day after the time of transmission, if such notice or communication is
delivered via facsimile at the facsimile number or email attachment as set forth on the signature pages attached hereto on a day that
is not a Trading Day or later than 5:30 p.m. (New York City time) on any Trading Day, (c) the second (2nd) Trading Day following
the date of mailing, if sent by U.S. nationally recognized overnight courier service or (d) upon actual receipt by the party to whom such
notice is required to be given. The address for such notices and communications shall be as set forth on the signature pages attached
hereto.
5.5 Amendments;
Waivers. No provision of this Agreement may be waived, modified, supplemented or amended except in a written instrument signed, in
the case of an amendment, by the Company and the Required Holders (or, prior to the Closing, the Company and each Purchaser) or, in the
case of a waiver, by the party against whom enforcement of any such waived provision is sought, provided that if any amendment, modification
or waiver disproportionately and adversely impacts a Purchaser (or group of Purchasers), the consent of such disproportionately impacted
Purchaser (or group of Purchasers) shall also be required. No waiver of any default with respect to any provision, condition or requirement
of this Agreement shall be deemed to be a continuing waiver in the future or a waiver of any subsequent default or a waiver of any other
provision, condition or requirement hereof, nor shall any delay or omission of any party to exercise any right hereunder in any manner
impair the exercise of any such right. Any amendment effected in accordance with this Section 5.5 shall be binding upon each Purchaser
and holder of Securities and the Company.
5.6 Headings.
The headings herein are for convenience only, do not constitute a part of this Agreement and shall not be deemed to limit or affect any
of the provisions hereof.
5.7 Successors
and Assigns. This Agreement shall be binding upon and inure to the benefit of the parties and their successors and permitted assigns.
The Company may not assign this Agreement or any rights or obligations hereunder without the prior written consent of each Purchaser (other
than by merger). Any Purchaser may assign any or all of its rights under this Agreement to any Person to whom such Purchaser assigns or
transfers any Securities, provided that such transferee agrees in writing to be bound, with respect to the transferred Securities, by
the provisions of the Transaction Documents that apply to the “Purchasers.”
5.8 No
Third Party Beneficiaries. This Agreement is intended for the benefit of the parties hereto and their respective successors and permitted
assigns and is not for the benefit of, nor may any provision hereof be enforced by, any other Person, except as otherwise set forth in
Section 4.10 and this Section 5.8.
5.9 Governing
Law. All questions concerning the construction, validity, enforcement and interpretation of the Transaction Documents shall be governed
by and construed and enforced in accordance with the internal laws of the State of New York, without regard to the principles of conflicts
of law thereof. Each party agrees that all legal Proceedings concerning the interpretations, enforcement and defense of the transactions
contemplated by this Agreement and any other Transaction Documents (whether brought against a party hereto or its respective affiliates,
directors, officers, shareholders, partners, members, employees or agents) shall be commenced exclusively in the state and federal courts
sitting in the City of New York. Each party hereby irrevocably submits to the exclusive jurisdiction of the state and federal courts sitting
in the City of New York, Borough of Manhattan for the adjudication of any dispute hereunder or in connection herewith or with any transaction
contemplated hereby or discussed herein (including with respect to the enforcement of any of the Transaction Documents), and hereby irrevocably
waives, and agrees not to assert in any Action or Proceeding, any claim that it is not personally subject to the jurisdiction of any such
court, that such Action or Proceeding is improper or is an inconvenient venue for such Proceeding. Each party hereby irrevocably waives
personal service of process and consents to process being served in any such Action or Proceeding by mailing a copy thereof via registered
or certified mail or overnight delivery (with evidence of delivery) to such party at the address in effect for notices to it under this
Agreement and agrees that such service shall constitute good and sufficient service of process and notice thereof. Nothing contained herein
shall be deemed to limit in any way any right to serve process in any other manner permitted by law. If any party shall commence an Action
or Proceeding to enforce any provisions of the Transaction Documents, then, in addition to the obligations of the Company under Section
4.10, the prevailing party in such Action or Proceeding shall be reimbursed by the non-prevailing party for its reasonable attorneys’
fees and other costs and expenses incurred with the investigation, preparation and prosecution of such Action or Proceeding.
5.10 Survival.
The representations and warranties contained herein shall survive the Closing and the delivery of the Securities.
5.11 Execution.
This Agreement may be executed in two or more counterparts, all of which when taken together shall be considered one and the same agreement
and shall become effective when counterparts have been signed by each party and delivered to each other party, it being understood that
the parties need not sign the same counterpart. In the event that any signature is delivered by facsimile transmission or by e-mail delivery
of a “.pdf” format data file, such signature shall create a valid and binding obligation of the party executing (or on whose
behalf such signature is executed) with the same force and effect as if such facsimile or “.pdf” signature page were an original
thereof.
5.12 Severability.
If any term, provision, covenant or restriction of this Agreement is held by a court of competent jurisdiction to be invalid, illegal,
void or unenforceable, the remainder of the terms, provisions, covenants and restrictions set forth herein shall remain in full force
and effect and shall in no way be affected, impaired or invalidated, and the parties hereto shall use their commercially reasonable efforts
to find and employ an alternative means to achieve the same or substantially the same result as that contemplated by such term, provision,
covenant or restriction. It is hereby stipulated and declared to be the intention of the parties that they would have executed the remaining
terms, provisions, covenants and restrictions without including any of such that may be hereafter declared invalid, illegal, void or unenforceable.
5.13 Rescission
and Withdrawal Right. Notwithstanding anything to the contrary contained in (and without limiting any similar provisions of) any of
the other Transaction Documents, whenever any Purchaser exercises a right, election, demand or option under a Transaction Document and
the Company does not timely perform its related obligations within the periods therein provided, then such Purchaser may rescind or withdraw,
in its sole discretion from time to time upon written notice to the Company, any relevant notice, demand or election in whole or in part
without prejudice to its future actions and rights.
5.14 Replacement
of Securities. If any certificate or instrument evidencing any Securities is mutilated, lost, stolen or destroyed, the Company shall
issue or cause to be issued in exchange and substitution for and upon cancellation thereof (in the case of mutilation), or in lieu of
and substitution therefor, a new certificate or instrument, but only upon receipt of evidence reasonably satisfactory to the Company of
such loss, theft or destruction. The applicant for a new certificate or instrument under such circumstances shall also pay any reasonable
third-party costs (including customary indemnity) associated with the issuance of such replacement Securities.
5.15 Remedies.
In addition to being entitled to exercise all rights provided herein or granted by law, including recovery of damages, each of the Purchasers
and the Company will be entitled to specific performance under the Transaction Documents. The parties agree that monetary damages may
not be adequate compensation for any loss incurred by reason of any breach of obligations contained in the Transaction Documents and hereby
agree to waive and not to assert in any Action for specific performance of any such obligation the defense that a remedy at law would
be adequate.
5.16 Payment
Set Aside. To the extent that the Company makes a payment or payments to any Purchaser pursuant to any Transaction Document or a Purchaser
enforces or exercises its rights thereunder, and such payment or payments or the proceeds of such enforcement or exercise or any part
thereof are subsequently invalidated, declared to be fraudulent or preferential, set aside, recovered from, disgorged by or are required
to be refunded, repaid or otherwise restored to the Company, a trustee, receiver or any other Person under any law (including, without
limitation, any bankruptcy law, state or federal law, common law or equitable cause of action), then to the extent of any such restoration
the obligation or part thereof originally intended to be satisfied shall be revived and continued in full force and effect as if such
payment had not been made or such enforcement or setoff had not occurred.
5.17 Usury.
To the extent it may lawfully do so, the Company hereby agrees not to insist upon or plead or in any manner whatsoever claim, and will
resist any and all efforts to be compelled to take the benefit or advantage of, usury laws wherever enacted, now or at any time hereafter
in force, in connection with any Action or Proceeding that may be brought by any Purchaser in order to enforce any right or remedy under
any Transaction Document. Notwithstanding any provision to the contrary contained in any Transaction Document, it is expressly agreed
and provided that the total liability of the Company under the Transaction Documents for payments in the nature of interest shall not
exceed the maximum lawful rate authorized under applicable law (the “Maximum Rate”), and, without limiting the foregoing,
in no event shall any rate of interest or default interest, or both of them, when aggregated with any other sums in the nature of interest
that the Company may be obligated to pay under the Transaction Documents exceed such Maximum Rate. It is agreed that if the maximum contract
rate of interest allowed by law and applicable to the Transaction Documents is increased or decreased by statute or any official governmental
action subsequent to the date hereof, the new maximum contract rate of interest allowed by law will be the Maximum Rate applicable to
the Transaction Documents from the effective date thereof forward, unless such application is precluded by applicable law. If under any
circumstances whatsoever, interest in excess of the Maximum Rate is paid by the Company to any Purchaser with respect to indebtedness
evidenced by the Transaction Documents, such excess shall be applied by such Purchaser to the unpaid principal balance of any such indebtedness
or be refunded to the Company, the manner of handling such excess to be at such Purchaser’s election.
5.18 Independent
Nature of Purchasers’ Obligations and Rights. The obligations of each Purchaser under any Transaction Document are several and
not joint with the obligations of any other Purchaser, and no Purchaser shall be responsible in any way for the performance or non-performance
of the obligations of any other Purchaser under any Transaction Document. Nothing contained herein or in any other Transaction Document,
and no action taken by any Purchaser pursuant hereto or thereto, shall be deemed to constitute the Purchasers as a partnership, an association,
a joint venture or any other kind of entity, or create a presumption that the Purchasers are in any way acting in concert or as a group
with respect to such obligations or the transactions contemplated by the Transaction Documents. Each Purchaser shall be entitled to independently
protect and enforce its rights, including, without limitation, the rights arising out of this Agreement or out of the other Transaction
Documents, and it shall not be necessary for any other Purchaser to be joined as an additional party in any Proceeding for such purpose.
Each Purchaser has been represented by its own separate legal counsel in its review and negotiation of the Transaction Documents. The
Company has elected to provide all Purchasers with the same terms and Transaction Documents for the convenience of the Company and not
because it was required or requested to do so by any of the Purchasers. It is expressly understood and agreed that each provision contained
in this Agreement and in each other Transaction Document is between the Company and a Purchaser, solely, and not between the Company and
the Purchasers collectively and not between and among the Purchasers.
5.19 Liquidated
Damages. The Company’s obligations to pay any partial liquidated damages or other amounts owing under the Transaction Documents
is a continuing obligation of the Company and shall not terminate until all unpaid partial liquidated damages and other amounts have been
paid notwithstanding the fact that the instrument or security pursuant to which such partial liquidated damages or other amounts are due
and payable shall have been canceled.
5.20 Saturdays, Sundays,
Holidays, etc. If the last or appointed day for the taking of any action or the expiration of any right required or granted herein
shall not be a Business Day, then such action may be taken or such right may be exercised on the next succeeding Business Day.
5.21 Construction.
The parties agree that each of them and/or their respective counsel have reviewed and had an opportunity to revise the Transaction Documents
and, therefore, the normal rule of construction to the effect that any ambiguities are to be resolved against the drafting party shall
not be employed in the interpretation of the Transaction Documents or any amendments thereto. In addition, each and every reference to
share prices and shares of Common Stock in any Transaction Document shall be subject to adjustment for reverse and forward stock splits,
stock dividends, stock combinations and other similar transactions of the Common Stock that occur after the date of this Agreement.
5.22 WAIVER
OF JURY TRIAL. IN ANY ACTION, SUIT, OR PROCEEDING IN ANY JURISDICTION BROUGHT BY ANY PARTY AGAINST ANY OTHER PARTY, THE PARTIES EACH
KNOWINGLY AND INTENTIONALLY, TO THE GREATEST EXTENT PERMITTED BY APPLICABLE LAW, HEREBY ABSOLUTELY, UNCONDITIONALLY, IRREVOCABLY AND EXPRESSLY
WAIVES FOREVER TRIAL BY JURY.
(Signature Pages Follow)
IN WITNESS WHEREOF, the parties
hereto have caused this Securities Purchase Agreement to be duly executed by their respective authorized signatories as of the date first
indicated above.
| ADITXT, inc. |
|
Address for Notice: |
| |
|
|
Aditxt, Inc. |
| |
|
|
2569 Wyandotte Street, Suite 101 |
| |
|
|
Mountain View, CA 94043 |
| By: |
|
|
Email: |
| |
Name: |
Amro Albanna |
|
|
| |
Title: |
Chief Executive Officer |
|
|
| With a copy to (which
shall not constitute notice): |
|
Richard A. Friedman, Esq.
Sheppard, Mullin, Richter & Hampton LLP
30 Rockefeller Plaza
New York, New York 10112 |
|
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK
SIGNATURE PAGE FOR PURCHASER FOLLOWS]
[PURCHASER
SIGNATURE PAGES TO ADTX 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: $_____________
Principal Amount of Notes: $_____________
Warrant Shares: _______________
EIN Number: _______________________
[SIGNATURE PAGES CONTINUE]
41
Exhibit 10.3
THIS SECURITY HAS NOT BEEN REGISTERED WITH
THE SECURITIES AND EXCHANGE COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE IN RELIANCE UPON AN EXEMPTION FROM REGISTRATION UNDER
THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT
TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT
TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS. THIS SECURITY MAY BE
PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT WITH A REGISTERED BROKER-DEALER OR OTHER LOAN WITH A FINANCIAL INSTITUTION THAT
IS AN “ACCREDITED INVESTOR” AS DEFINED IN RULE 501(a) UNDER THE SECURITIES ACT OR OTHER LOAN SECURED BY SUCH SECURITIES. ANY
TRANSFEREE OF THIS NOTE SHOULD CAREFULLY REVIEW THE TERMS OF THIS NOTE, INCLUDING SECTIONS 3(c)(iii) AND 18(a) HEREOF. THE PRINCIPAL AMOUNT
REPRESENTED BY THIS NOTE MAY BE LESS THAN THE AMOUNT SET FORTH ON THE FACE HEREOF PURSUANT TO SECTION 3(c)(iii) OF THIS NOTE.
THIS NOTE HAS BEEN ISSUED WITH ORIGINAL ISSUE
DISCOUNT (“OID”). PURSUANT TO TREASURY REGULATION §1.1275-3(b)(1), AMRO ALBANNA, A REPRESENTATIVE OF THE COMPANY HEREOF
WILL, BEGINNING TEN DAYS AFTER THE ISSUANCE DATE OF THIS NOTE, PROMPTLY MAKE AVAILABLE TO THE HOLDER UPON REQUEST THE INFORMATION DESCRIBED
IN TREASURY REGULATION §1.1275-3(b)(1)(i). AMRO ALBANNA MAY BE REACHED AT TELEPHONE NUMBER 650-870-1200.
ADITXT,
INC.
SENIOR
NOTE
| Issuance Date: July 12, 2024 |
Original Principal Amount: U.S. $ |
FOR VALUE RECEIVED, Aditxt,
Inc., a Delaware corporation (the “Company”), hereby promises to pay to ______________________________ or registered
assigns (the “Holder”) in cash the amount set forth above as the Original Principal Amount (as reduced pursuant to
the terms hereof pursuant to redemption or otherwise, the “Principal”) when due, whether upon the Maturity Date (as
defined below), acceleration, redemption or otherwise (in each case in accordance with the terms hereof) and to pay interest (“Interest”),
if applicable, on any outstanding Principal at the applicable Default Rate at any time during the occurrence and continuance of an Event
of Default occurring from the date set out above as the Issuance Date (the “Issuance Date”) until the same becomes
due and payable, whether upon the Maturity Date, acceleration, redemption or otherwise (in each case in accordance with the terms hereof).
This Senior Note (including all Senior Notes issued in exchange, transfer or replacement hereof, this “Note”) is one
of an issue of Senior Notes issued on the Closing Date and such other Senior Notes issued on May 24, 2024 (collectively, the “Notes”
and such other Senior Notes, the “Other Notes”). Certain capitalized terms used herein are defined in Section 31.
(1) ORIGINAL
ISSUE DISCOUNT; PAYMENTS OF PRINCIPAL; PREPAYMENT. The Company acknowledges and agrees that this Note was issued at an original issue
discount. On the Maturity Date, if any portion of this Note remains outstanding, the Company shall pay to the Holder an amount in cash
representing all outstanding Principal, any accrued and unpaid Interest. The “Maturity Date” shall be October 7, 2024
as may be extended at the option of the Holder (x) in the event that, and for so long as, an Event of Default (as defined in Section 4(a))
shall have occurred and be continuing on the Maturity Date (as may be extended pursuant to this Section 1) or any event shall have occurred
and be continuing on the Maturity Date (as may be extended pursuant to this Section 1) that with the passage of time and the failure to
cure would result in an Event of Default and/or (y) through the date that is ten (10) Business Days after the consummation of a Change
of Control in the event that a Change of Control is publicly announced or a Change of Control Notice (as defined in Section 5(b)) is delivered
prior to the Maturity Date. Other than as specifically permitted by this Note, the Company may not prepay any portion of the outstanding
Principal or accrued and unpaid Interest, if any.
(2) INTEREST.
No Interest shall accrue hereunder unless and until an Event of Default has occurred. From and after the occurrence and during the continuance
of any Event of Default, Interest shall accrue hereunder at fourteen percent (14.0%) per annum (the “Default Rate”)
and shall be computed on the basis of a 360-day year and twelve 30-day months and shall be payable, if applicable, on the Maturity Date
to the record holder of this Note in cash by wire transfer of immediately available funds pursuant to wire instructions provided by the
Holder in writing to the Company. Accrued and unpaid Interest, if any, may also be payable, at the election of the Holder, by way of inclusion
of the Interest in the Note Amount (as defined below) upon any redemption hereunder occurring prior to the Maturity Date, including, without
limitation, upon a Bankruptcy Event of Default redemption. In the event that an Event of Default is subsequently cured (and no other Event
of Default then exists (including, without limitation, for the Company’s failure to pay such Interest at the Default Rate on the Maturity
Date)), Interest shall cease to accrue hereunder as of the calendar day immediately following the date of such cure; provided that
the Interest as calculated and unpaid during the continuance of such Event of Default shall continue to apply to the extent relating to
the days after the occurrence of such Event of Default through and including the date of such cure of such Event of Default; provided,
further, that for the purpose of this Section 2, such Event of Default shall not be deemed cured unless and until any accrued and
unpaid Interest shall be paid to the Holder. As used herein, “Note Amount” means the sum of (x) the portion of the
Principal to be redeemed or otherwise with respect to which this determination is being made, and (y) accrued and unpaid Interest, if
any, with respect to such Principal.
(3) Note
Registration; Book Entry. The Company shall maintain a register (the “Register”) for the recordation of the names
and addresses of the holders of each Note and the Principal amount of the Notes (and stated interest thereon) held by such holders (the
“Registered Notes”). The entries in the Register shall be conclusive and binding for all purposes absent manifest error.
The Company and the holders of the Notes shall treat each Person whose name is recorded in the Register as the owner of a Note for all
purposes, including, without limitation, the right to receive payments of Principal and Interest, if any, hereunder, notwithstanding notice
to the contrary. A Registered Note may be assigned or sold in whole or in part only by registration of such assignment or sale on the
Register. Upon its receipt of a request to assign or sell all or part of any Registered Note by the Holder, the Company shall record the
information contained therein in the Register and issue one or more new Registered Notes in the same aggregate Principal amount as the
Principal amount of the surrendered Registered Note to the designated assignee or transferee pursuant to Section 18. Notwithstanding anything
to the contrary in this Section 3(c)(iii), the Holder may assign any Note or any portion thereof to an Affiliate of the Holder or a Related
Fund of the Holder without delivering a request to assign or sell the Note to the Company and the recordation of such assignment or sale
in the Register (a “Related Party Assignment”); provided, that (x) the Company may continue to deal solely with such
assigning or selling Holder unless and until the Holder has delivered a request to assign or sell the Note or portion thereof to the Company
for recordation in the Register; (y) the failure of such assigning or selling Holder to deliver a request to assign or sell the Note or
portion thereof to the Company shall not affect the legality, validity, or binding effect of such assignment or sale and (z) such assigning
or selling Holder shall, acting solely for this purpose as a non-fiduciary agent of the Company, maintain a register (the “Related
Party Register”) comparable to the Register on behalf of the Company, and any such assignment or sale shall be effective upon
recordation of such assignment or sale in the Related Party Register.
(4) RIGHTS
UPON EVENT OF DEFAULT.
(a) Event
of Default. Each of the following events or failure to comply therewith shall constitute an “Event of Default”
and each of the events described in clauses (iii) and (iv) shall also constitute a “Bankruptcy Event of Default”:
(i) the
Company’s failure to pay to the Holder any amount of Principal, Interest, Redemption Price or other amounts when and as due under this
Note or any other Transaction Document, except, in the case of a failure to pay Interest when and as due, in which case only if such failure
continues for a period of at least an aggregate of two (2) Business Days;
(ii) any
default under, redemption of or acceleration prior to maturity of any Indebtedness of the Company or any of its Subsidiaries other than
with respect to this Note or any Other Notes;
(iii) the
Company or any of its Subsidiaries, pursuant to or within the meaning of Title 11, U.S. Code, or any similar federal, foreign or state
law for the relief of debtors (collectively, “Bankruptcy Law”), (A) commences a bankruptcy voluntary case, (B) consents
to the entry of an order for relief against it in an involuntary bankruptcy case, (C) consents to the appointment of a receiver, trustee,
assignee, liquidator or similar official (a “Custodian”), (D) makes a general assignment for the benefit of its creditors
or (E) admits in writing that it is generally unable to pay its debts as they become due;
(iv) a
court of competent jurisdiction enters an order or decree under any Bankruptcy Law that (A) is for relief against the Company or any of
its Subsidiaries in an involuntary case, (B) appoints a Custodian of the Company or any of its Subsidiaries or (C) orders the liquidation
of the Company or any of its Subsidiaries;
(v) a
final judgment or judgments for the payment of money aggregating in excess of $250,000 are rendered against the Company or any of its
Subsidiaries and which judgments are not, within sixty (60) days after the entry thereof, bonded, discharged or stayed pending appeal,
or are not discharged within sixty (60) days after the expiration of such stay; provided, however, that any judgment which
is covered by insurance or an indemnity from a credit worthy party shall not be included in calculating the $250,000 amount set forth
above so long as the Company provides the Holder a written statement from such insurer or indemnity provider (which written statement
shall be reasonably satisfactory to the Holder) to the effect that such judgment is covered by insurance or an indemnity and the Company
or such Subsidiary (as the case may be) will receive the proceeds of such insurance or indemnity within thirty (30) days of the issuance
of such judgment;
(vi) other
than as specifically set forth in another clause of this Section 4(a), the Company or any of its Subsidiaries breaches any representation,
warranty, covenant or other term or condition of any Transaction Document, except, in the case of a breach of a covenant or other term
or condition of any Transaction Document which is curable, only if such breach continues for a period of at least an aggregate of five
(5) Business Days;
(vii) any
breach or failure in any respect to comply with either Sections 14 or 15 of this Note;
(viii) any
material damage to, or loss, theft or destruction of a material amount of property of the Company, whether or not insured, or any strike,
lockout, labor dispute, embargo, condemnation, act of God or public enemy, or other casualty which causes, for more than fifteen (15)
consecutive days, the cessation or substantial curtailment of revenue producing activities at any facility of the Company or any Subsidiary,
if any such event or circumstance would reasonably be expected to have a Material Adverse Effect;
(ix) any
Material Adverse Effect occurs;
(x) the
Company fails to file a registration statement with the Commission for a primary offering on Form S-1 on or before August 30, 2024;
(xi) any
Event of Default (as defined in the Other Notes) occurs with respect to any Other Notes.
(b) Redemption
Right. At any time after the earlier of the Holder’s receipt of an Event of Default Notice (as defined in Section 15(f)) and the Holder
becoming aware of an Event of Default, the Holder may require the Company to redeem (an “Event of Default Redemption”)
all or any portion of this Note by delivering written notice thereof (the “Event of Default Redemption Notice”) to
the Company, which Event of Default Redemption Notice shall indicate the portion of this Note the Holder is electing to require the Company
to redeem. Each portion of this Note subject to redemption by the Company pursuant to this Section 4(b) shall be redeemed by the Company
in cash by wire transfer of immediately available funds at a price equal to the product of (A) the Redemption Premium and (B) the Note
Amount being redeemed (the “Event of Default Redemption Price”). Redemptions required by this Section 4(b) shall be
made in accordance with the provisions of Section 11. To the extent redemptions required by this Section 4(b) are deemed or determined
by a court of competent jurisdiction to be prepayments of the Note by the Company, such redemptions shall be deemed to be voluntary prepayments.
The parties hereto agree that in the event of the Company’s redemption of any portion of the Note under this Section 4(b), the Holder’s
damages would be uncertain and difficult to estimate because of the parties’ inability to predict future interest rates and the uncertainty
of the availability of a suitable substitute investment opportunity for the Holder. Accordingly, any Redemption Premium with respect to
an Event of Default due under this Section 4(b) is intended by the parties to be, and shall be deemed, a reasonable estimate of the Holder’s
actual loss of its investment opportunity and not as a penalty.
(c) Redemption
upon Bankruptcy Event of Default. Notwithstanding anything to the contrary herein upon any Bankruptcy Event of Default, whether occurring
prior to or following the Maturity Date, the Company shall immediately pay to the Holder an amount in cash representing 100% of all outstanding
Principal, accrued and unpaid Interest, if any, in addition to any and all other amounts due hereunder (the “Bankruptcy Event
of Default Redemption Price”), without the requirement for any notice or demand or other action by the Holder or any other Person;
provided that the Holder may, in its sole discretion, waive such right to receive payment upon a Bankruptcy Event of Default, in whole
or in part, and any such waiver shall not affect any other rights of the Holder hereunder, including any other rights in respect of such
Bankruptcy Event of Default, and any right to payment of the Event of Default Redemption Price or any other Redemption Price, as applicable.
Redemptions required by this Section 3(c) shall be made in accordance with the provisions of Section 11.
(5) RIGHTS
UPON FUNDAMENTAL TRANSACTION AND CHANGE OF CONTROL.
(a) Assumption.
The Company shall cause any successor entity in a Fundamental Transaction in which the Company is not the survivor (the “Successor
Entity”) to assume in writing all of the obligations of the Company under this Note and the other Transaction Documents in accordance
with the provisions of this Section 5(a) pursuant to written agreements in form and substance reasonably satisfactory to the Holder and
approved by the Holder (without unreasonable delay) prior to such Fundamental Transaction and shall, at the option of the Holder, deliver
to the Holder in exchange for this Note a security of the Successor Entity evidenced by a written instrument substantially similar in
form and substance to this Note. Upon the occurrence of any such Fundamental Transaction, the Successor Entity shall be added to the term
“Company” under this Note (so that from and after the occurrence or consummation of
such Fundamental Transaction, each and every provision of this Note and the other Transaction Documents referring to the “Company”
shall refer instead to each of the Company and the Successor Entity or Successor Entities, jointly and severally), and the Successor Entity
or Successor Entities, jointly and severally with the Company, may exercise every right and power of the Company prior thereto and the
Successor Entity or Successor Entities shall assume all of the obligations of the Company prior thereto under this Note and the other
Transaction Documents with the same effect as if the Company and such Successor Entity or Successor Entities, jointly and severally, had
been named as the Company in this Note.
(b) Redemption
Right. No later than ten (10) days prior to the consummation of a Change of Control, the Company shall deliver written notice thereof
via electronic mail and overnight courier to the Holder (a “Change of Control Notice”) setting
forth a description of such transaction in reasonable detail and the anticipated Change of Control Redemption Date (as defined in Section
11(a)) if then known. At any time during the period beginning on the earlier to occur of (x) any oral or written agreement by the
Company or any of its Subsidiaries, upon consummation of which the transaction contemplated thereby would reasonably be expected to result
in a Change of Control, (y) the Holder becoming aware of a Change of Control and (z) the Holder’s receipt of a Change of Control Notice
and ending twenty-five (25) days after the date of the consummation of such Change of Control, the Holder may require the Company to redeem
(a “Change of Control Redemption”) all or any portion of this Note by delivering written notice thereof (“Change
of Control Redemption Notice”) to the Company, which Change of Control Redemption Notice shall indicate the Note Amount the
Holder is electing to require the Company to redeem. The portion of this Note subject to redemption pursuant to this Section 5(b) shall
be redeemed by the Company in cash by wire transfer of immediately available funds at a price equal to the Note Amount being redeemed
(the “Change of Control Redemption Price”). Redemptions required by this Section 5 shall be made in accordance with
the provisions of Section 11 and shall have priority to payments to stockholders in connection with a Change of Control. To the extent
redemptions required by this Section 5(b) are deemed or determined by a court of competent jurisdiction to be prepayments of the Note
by the Company, such redemptions shall be deemed to be voluntary prepayments. The parties hereto agree that in the event of the Company’s
redemption of any portion of the Note under this Section 5(b), the Holder’s damages would be uncertain and difficult to estimate because
of the parties’ inability to predict future interest rates and the uncertainty of the availability of a suitable substitute investment
opportunity for the Holder.
(6) [Intentionally
Omitted]
(7) Mandatory
Redemption.
(a) Occurrence
of Mandatory Redemption. While this Note is outstanding, the Company shall use at least 100% of the net proceeds of any offering of
its securities, including any underwritten or other public offering of securities (any such offering, a “Subsequent Offering”)
to first redeem this Note in full, including the Note Amount and all other amounts due and payable pursuant to this Note, and all other
then outstanding Notes (a “Mandatory Redemption”); provided, however, that if 100% of the net proceeds
of the Subsequent Offering are less than the amount required to repay all of the Notes in full, (i) the Company’s repayment obligation
under this Section 6(a) shall be limited to the amount of such net proceeds, (ii) the net proceeds shall be applied to all of the Notes
then outstanding pro rata based on the principal amount of such Notes then outstanding and (iii) the Company shall effect successive Mandatory
Redemptions upon each Subsequent Offering until the Notes are repaid in full or otherwise no longer outstanding.
(b) Mandatory
Notices. With respect to each Mandatory Redemption, the Company shall deliver a written notice to all, but not less than all, of the
holders of Notes (the “Mandatory Redemption Notice” and the date such notice is delivered to all such holders is referred
to as a “Mandatory Redemption Notice Date”) (a) stating the date on which the Mandatory Redemption shall occur (a “Mandatory
Redemption Date”), which date shall be the date of the consummation of the applicable Subsequent Offering, (b) stating the expected
amount of Net Proceeds with respect to the applicable Subsequent Offering and (c) contain a certification from the Chief Executive Officer
or Chief Financial Officer of the Company that the Company has simultaneously taken the same action with respect to all of the Notes.
Each Mandatory Redemption Notice shall be delivered no later than the first (1st) Business Day following the announcement of the pricing
of the applicable Subsequent Offering, and the Company shall make a public announcement containing the information set forth in the applicable
Mandatory Redemption Notice on or before the related Mandatory Redemption Notice Date to the extent that the notice contains any, or constitutes,
material, non-public information.
(c)
Mandatory Redemption Procedure. The payment of cash pursuant to the Mandatory Redemption shall be payable in full on the Business
Day immediately following the Mandatory Redemption Date by wire transfer of immediately available funds in accordance with the Holder’s
wire instructions. If any portion of the payment pursuant to a Mandatory Redemption shall not be paid by the Company by the applicable
due date, interest shall accrue thereon at an interest rate equal to the lesser of eighteen percent (18%) per annum or the maximum rate
permitted by applicable law until such amount is paid in full. Notwithstanding anything to the contrary in this Section 6(c), the Net
Proceeds shall be applied ratably among the Holders of the Notes.
(8) OPTIONAL
PREPAYMENT. The Company may prepay (each, an “Optional Prepayment”) the Note in whole or in part at any time or
from time to time by paying the Holder in cash by wire transaction of immediately available funds 100% of the Note Amount being prepaid.
The Company may exercise its right to require prepayment under this Section 8 by delivering a written notice thereof by electronic mail
and overnight courier to the Holder and all, but not less than all, of the holders of the Other Notes (an “Optional Prepayment
Notice” and the date all of the holders of the Notes received such notice is referred to as the “Optional Prepayment
Notice Date”). Each Optional Prepayment Notice shall be irrevocable. Each Optional Prepayment Notice shall (i) state the date
on which the Optional Prepayment shall occur (the “Optional Prepayment Date”), which date shall not be less than two
(2) Business Days following the applicable Optional Prepayment Notice Date, and (ii) state the aggregate Note Amount of the Notes which
the Company has elected to be subject to Optional Prepayment from the Holder and all of the other holders of the Other Notes pursuant
to this Section 8 (and analogous provisions under the Other Notes) on the related Optional Prepayment Date. If the Company elects to cause
an Optional Prepayment pursuant to this Section 8, then it must simultaneously take the same action in the same proportion with respect
to the Other Notes.
(9) NONCIRCUMVENTION.
The Company hereby covenants and agrees that the Company will not, by amendment of its Certificate of Incorporation or Bylaws or through
any reorganization, transfer of assets, consolidation, merger, scheme of arrangement, dissolution, issue or sale of securities, or any
other voluntary action, avoid or seek to avoid the observance or performance of any of the terms of this Note, and will at all times in
good faith carry out all of the provisions of this Note and take all action as may be required to protect the rights of the Holder of
this Note.
(10) [Intentionally
Omitted]
(11) REDEMPTIONS.
(a) Mechanics.
The Company shall deliver the applicable Event of Default Redemption Price to the Holder within three (3) Business Days after the Company’s
receipt of the Holder’s Event of Default Redemption Notice; provided that upon a Bankruptcy Event of Default, the Company shall deliver
the applicable Bankruptcy Event of Default Redemption Price in accordance with Section 4(c) (as applicable, the “Event of Default
Redemption Date”). If the Holder has submitted a Change of Control Redemption Notice in accordance with Section 5(b), the Company
shall deliver the applicable Change of Control Redemption Price to the Holder (i) concurrently with the consummation of such Change of
Control if such notice is received prior to the consummation of such Change of Control and (ii) within three (3) Business Days after the
Company’s receipt of such notice otherwise (such date, the “Change of Control Redemption Date”). The Company shall
deliver the applicable Note Amount being prepaid to the Holder on the applicable Optional Prepayment Date. The Company shall pay the applicable
Redemption Price to the Holder in cash by wire transfer of immediately available funds pursuant to wire instructions provided by the Holder
in writing to the Company on the applicable due date. In the event of a redemption of less than all of the Note Amount of this Note, the
Company shall promptly cause to be issued and delivered to the Holder a new Note (in accordance with Section 18(d)) representing the outstanding
Principal which has not been redeemed and any accrued Interest on such Principal which shall be calculated as if no Redemption Notice
has been delivered. In the event that the Company does not pay a Redemption Price to the Holder within the time period required, at any
time thereafter and until the Company pays such unpaid Redemption Price in full, the Holder shall have the option, in lieu of redemption,
to require the Company to promptly return to the Holder all or any portion of this Note representing the Note Amount that was submitted
for redemption and for which the applicable Redemption Price has not been paid. Upon the Company’s receipt of such notice, (x) the applicable
Redemption Notice shall be null and void with respect to such Note Amount, and (y) the Company shall immediately return this Note, or
issue a new Note (in accordance with Section 18(d)) to the Holder representing such Note Amount to be redeemed.
(b) Redemption
by Other Holders. Upon the Company’s receipt of notice from any of the holders of the Other Notes for redemption or repayment as a
result of an event or occurrence substantially similar to the events or occurrences described in Section 4(b), Section 5(b) or Section
8 or pursuant to corresponding provisions set forth in the Other Notes (each, an “Other Redemption Notice”), the Company
shall immediately, but no later than one (1) Business Day of its receipt thereof, forward to the Holder by electronic mail a copy of such
notice. If the Company receives a Redemption Notice and one or more Other Redemption Notices, during the seven (7) Business Day period
beginning on and including the date which is three (3) Business Days prior to the Company’s receipt of the Holder’s Redemption Notice
and ending on and including the date which is three (3) Business Days after the Company’s receipt of the Holder’s Redemption Notice and
the Company is unable to redeem all principal, interest and other amounts designated in such Redemption Notice and such Other Redemption
Notices received during such seven (7) Business Day period, then the Company shall redeem, a pro rata amount from the Holder and each
holder of the Other Notes based on the Principal amount of this Note and the Other Notes submitted for redemption pursuant to such Redemption
Notice and such Other Redemption Notices received by the Company during such seven (7) Business Day period.
(c) Insufficient
Assets. If upon a Redemption Date, the assets of the Company are insufficient to pay the applicable Redemption Price, the Company
shall (i) take all appropriate action reasonably within its means to maximize the assets available for paying the applicable Redemption
Price, (ii) redeem out of all such assets available therefor on the applicable Redemption Date the maximum possible portion of the applicable
Redemption Price that it can redeem on such date, pro rata among the Holder and the holders of the Other Notes to be redeemed in proportion
to the aggregate Principal amount of this Note and the Other Notes outstanding on the applicable Redemption Date and (iii) following the
applicable Redemption Date, at any time and from time to time when additional assets of the Company become available to pay the balance
of the applicable Redemption Price of this Note and the Other Notes, the Company shall use such assets, at the end of the then current
fiscal quarter, to pay the balance of such Redemption Price of this Note and the Other Notes, or such portion thereof for which assets
are then available, on the basis set forth above at the applicable Redemption Price, and such assets will not be used prior to the end
of such fiscal quarter for any other purpose. Interest on the Principal amount of this Note and the Other Notes that have not been redeemed
shall continue to accrue until such time as the Company redeems this Note and the Other Notes. The Company shall pay to the Holder the
applicable Redemption Price without regard to the legal availability of funds unless expressly prohibited by applicable law or unless
the payment of the applicable Redemption Price could reasonably be expected to result in personal liability to the directors of the Company.
(12) VOTING
RIGHTS. The Holder shall have no voting rights as the holder of this Note, except as required by law and as expressly provided in
this Note.
(13) RANK.
All payments due under this Note (a) shall rank pari passu with all Other Notes and (b) shall be senior to all other Indebtedness
of the Company and its Subsidiaries.
(14) NEGATIVE
COVENANTS. Except as noted below, until all of the Notes have been redeemed or otherwise satisfied in full in accordance with their
terms, the Company shall not, and the Company shall not permit any of its Subsidiaries without the prior written consent of the Required
Holders to, directly or indirectly by merger or otherwise:
(a) while
any Notes remain outstanding, incur or guarantee, assume or suffer to exist any Indebtedness, other than Permitted Indebtedness;
(b) allow
or suffer to exist any mortgage, lien, pledge, charge, security interest or other encumbrance upon or in any property or assets (including
accounts and contract rights) owned by the Company or any of its Subsidiaries (collectively, “Liens”) other than Permitted
Liens;
(c) redeem,
defease, repurchase, repay or make any payments in respect of, by the payment of cash or cash equivalents (in whole or in part, whether
by way of open market purchases, tender offers, private transactions or otherwise), all or any portion of any Indebtedness (other than
this Note and the Other Notes), whether by way of payment in respect of principal of (or premium, if any) or interest on, such Indebtedness
if at the time such payment is due or is otherwise made or, after giving effect to such payment, an event constituting, or that with the
passage of time and without being cured would constitute, an Event of Default has occurred and is continuing;
(d) redeem,
defease, repurchase, repay or make any payments in respect of, by the payment of cash or cash equivalents (in whole or in part, whether
by way of open market purchases, tender offers, private transactions or otherwise), all or any portion of any Indebtedness (including,
without limitation Permitted Indebtedness other than this Note and the Other Notes), by way of payment in respect of principal of (or
premium, if any) such Indebtedness. For clarity, such restriction shall not preclude the payment of regularly scheduled interest payments
which may accrue under such Permitted Indebtedness;
(e) redeem
or repurchase any Equity Interest of the Company;
(f) declare
or pay any cash dividend or distribution on any Equity Interest of the Company or of its Subsidiaries other than wholly-owned Subsidiaries;
(g) make,
any change in the nature of its business as described in the Company’s most recent Annual Report filed on Form 10-K with the SEC or modify
its corporate structure or purpose; or
(h) encumber,
license or otherwise allow any Liens on any Intellectual Property Rights, including, without limitation, any claims for damage by way
of any past, present, or future infringement of any of the foregoing, in each case, other than Permitted Liens;
(i) enter
into, renew, extend or be a party to, any transaction or series of related transactions (including, without limitation, the purchase,
sale, lease, license, transfer or exchange of property or assets of any kind or the rendering of services of any kind) with any Affiliate,
except in the ordinary course of business in a manner and to an extent consistent with past practice and necessary or desirable for the
prudent operation of its business, for fair consideration and on terms no less favorable to it or its Subsidiaries than would be obtainable
in a comparable arm’s length transaction with a Person that is not an Affiliate thereof; or
(j) issue
any Notes or issue any other securities that would cause a breach or default under the Notes.
(15) AFFIRMATIVE
COVENANTS. Until all of the Notes have been redeemed or otherwise satisfied in full in accordance with their terms, the Company shall,
and the Company shall cause each Subsidiary to, unless otherwise agreed to by the Required Holders, directly
and indirectly:
(a) maintain
and preserve its existence, rights and privileges, and become or remain duly qualified and in good standing in each jurisdiction in which
the character of the properties owned or leased by it or in which the transaction of its business
makes such qualification necessary;
(b) maintain
and preserve all of its properties which are necessary or useful in the proper conduct of its business in good working order and condition,
ordinary wear and tear excepted, and comply at all times with the provisions of all leases to which it is a party as lessee or under which
it occupies property, so as to prevent any loss or forfeiture thereof or thereunder;
(c) take
all action necessary or advisable to maintain all of the Intellectual Property Rights that is necessary or material to the conduct of
its business in full force and effect;
(d) maintain
insurance with responsible and reputable insurance companies or associations (including, without limitation, comprehensive general liability,
hazard, rent and business interruption insurance) with respect to its properties (including all real properties leased or owned by it)
and business, in such amounts and covering such risks as is required by any governmental authority having jurisdiction with respect thereto
or as is carried generally in accordance with sound business practice by companies in similar businesses similarly situated; and
(e) promptly,
but in any event within one (1) Business Day, notify the Holder and the holders of the Other Notes in writing whenever an Event of Default
(an “Event of Default Notice”) occurs, and simultaneously with the delivery of such notice to the Holder and the holders
of the Other Notes, file a Current Report on Form 8-K with the SEC to state such fact.
(16) VOTE
TO ISSUE, OR CHANGE THE TERMS OF, NOTES. The affirmative vote at a meeting duly called for such purpose or the written consent without
a meeting of the Required Holders shall be required for any exchange, change or amendment or waiver of any provision to this Note or any
of the Other Notes. Any exchange, change, amendment or waiver by the Company and the Required Holders shall be binding on the Holder of
this Note and all holders of the Other Notes. The Holder hereby acknowledges and agrees that any action taken pursuant to this Section
may result in, or be perceived to result in, a disproportionate impact on the Holder compared to the impact of such action on one or more
holder(s) of Other Notes. This provision constitutes a separate right granted to each of the holders of Notes by the Company and shall
not in any way be construed as such holders acting in concert or as a group with respect to the purchase, disposition or voting of securities
or otherwise.
(17) TRANSFER.
This Note may be offered, sold, assigned or transferred by the Holder without the consent of the Company, subject only to the provisions
of Section 4.1 of the Securities Purchase Agreement.
(18) REISSUANCE
OF THIS NOTE.
(a) Transfer.
If this Note is to be transferred, the Holder shall surrender this Note to the Company, whereupon the Company will forthwith issue and
deliver upon the order of the Holder a new Note (in accordance with Section 18(d) and subject to Section 3(c)(iii)), registered as the
Holder may request, representing the outstanding Principal being transferred by the Holder and, if less than the entire outstanding Principal
is being transferred, a new Note (in accordance with Section 18(d)) to the Holder representing the outstanding Principal not being transferred.
The Holder and any assignee, by acceptance of this Note, acknowledge and agree that, by reason of the provisions of Section 3(c)(iii)
following redemption of any portion of this Note, the outstanding Principal represented by this Note may be less than the Principal stated
on the face of this Note.
(b) Lost,
Stolen or Mutilated Note. Upon receipt by the Company of evidence reasonably satisfactory to the Company of the loss, theft, destruction
or mutilation of this Note, and, in the case of loss, theft or destruction, of any indemnification undertaking by the Holder to the Company
in customary form (but without any obligation to post a surety or other bond) and, in the case of mutilation, upon surrender and cancellation
of this Note, the Company shall execute and deliver to the Holder a new Note (in accordance with Section 18(d)) representing the outstanding
Principal.
(c) Note
Exchangeable for Different Denominations. This Note is exchangeable, upon the surrender hereof by the Holder at the principal office
of the Company, for a new Note or Notes (in accordance with Section 18(d)) representing in the aggregate the outstanding Principal of
this Note, and each such new Note will represent such portion of such outstanding Principal as is designated by the Holder at the time
of such surrender.
(d) Issuance
of New Notes. Whenever the Company is required to issue a new Note pursuant to the terms of this Note, such new Note (i) shall be
of like tenor with this Note, (ii) shall represent, as indicated on the face of such new Note, the Principal remaining outstanding (or
in the case of a new Note being issued pursuant to Section 18(a) or Section 18(c), the Principal designated by the Holder which, when
added to the principal represented by the other new Notes issued in connection with such issuance, does not exceed the Principal remaining
outstanding under this Note immediately prior to such issuance of new Notes), (iii) shall have an issuance date, as indicated on the face
of such new Note, which is the same as the Issuance Date of this Note, (iv) shall have the same rights and conditions as this Note, and
(v) shall represent accrued and unpaid Interest, if any, from the Issuance Date.
(19) REMEDIES,
CHARACTERIZATIONS, OTHER OBLIGATIONS, BREACHES AND INJUNCTIVE RELIEF. The remedies provided in this Note shall be cumulative and in
addition to all other remedies available under this Note and any of the other Transaction Documents at law or in equity (including a decree
of specific performance and/or other injunctive relief). No remedy contained herein shall be deemed
a waiver of compliance with the provisions giving rise to such remedy. Nothing herein shall limit the Holder’s right to pursue
actual and consequential damages for any failure by the Company to comply with the terms of this Note. The Company covenants to the Holder
that there shall be no characterization concerning this instrument other than as expressly provided herein. Amounts set forth or provided
for herein with respect to payments, redemption and the like (and the computation thereof) shall be the amounts to be received by the
Holder and shall not, except as expressly provided herein, be subject to any other obligation of the Company (or the performance thereof).
The Company acknowledges that a breach by it of its obligations hereunder will cause irreparable harm to the Holder and that the remedy
at law for any such breach may be inadequate. The Company therefore agrees that, in the event of any such breach or threatened breach,
the Holder shall be entitled, in addition to all other available remedies, to an injunction restraining any breach, without the necessity
of showing economic loss and without any bond or other security being required.
(20) PAYMENT
OF COLLECTION, ENFORCEMENT AND OTHER COSTS. If (a) this Note is placed in the hands of an attorney for collection or enforcement or
is collected or enforced through any legal proceeding or the Holder otherwise takes action to collect amounts due under this Note or to
enforce the provisions of this Note or (b) there occurs any bankruptcy, reorganization, receivership of the Company or other proceedings
affecting Company creditors’ rights and involving a claim under this Note, then the Company shall pay the costs incurred by the Holder
for such collection, enforcement or action or in connection with such bankruptcy, reorganization, receivership or other proceeding, including,
but not limited to, attorneys’ fees and disbursements. The Company expressly acknowledges and agrees that no amounts due under this Note
shall be affected, or limited, by the fact that the purchase price paid for this Note was less than the original Principal amount hereof.
(21) CONSTRUCTION;
HEADINGS. This Note shall be deemed to be jointly drafted by the Company and all the Purchasers and shall not be construed against
any Person as the drafter hereof. The headings of this Note are for convenience of reference and shall not form part of, or affect the
interpretation of, this Note.
(22) FAILURE
OR INDULGENCE NOT WAIVER. No failure or delay on the part of the Holder in the exercise of any power, right or privilege hereunder
shall operate as a waiver thereof, nor shall any single or partial exercise of any such power, right or privilege preclude other or further
exercise thereof or of any other right, power or privilege. No waiver shall be effective unless it is in writing and signed by an authorized
representative of the waiving party.
(23) DISPUTE
RESOLUTION. In the case of a dispute as to the determination of any Redemption Price, the Company shall pay the applicable Redemption
Price that is not disputed, and the Company shall submit the disputed determinations or arithmetic calculations via electronic mail within
one (1) Business Day of receipt, or deemed receipt, of the Redemption Notice or other event giving rise to such dispute, as the case may
be, to the Holder. If the Holder and the Company are unable to agree upon such determination or calculation within one (1) Business Day
of such disputed determination or arithmetic calculation being submitted to the Holder, then the Company shall, within one (1) Business
Day submit via electronic mail the disputed arithmetic calculation of any Redemption Price to an independent, outside accountant, selected
by the Holder and approved by the Company, such approval not to be unreasonably withheld, conditioned or delayed. The Company, at the
Company’s expense, shall cause the accountant to perform the determinations or calculations and notify the Company and the Holder of the
results no later than five (5) Business Days from the time it receives the disputed determinations or calculations. Such accountant’s
determination or calculation, as the case may be, shall be binding upon all parties absent demonstrable error.
(24) NOTICES;
PAYMENTS.
(a) Notices.
Whenever notice is required to be given under this Note, unless otherwise provided herein, such notice shall be given in accordance with
Section 5.4 of the Securities Purchase Agreement. The Company shall provide the Holder with prompt written notice of all actions taken
pursuant to this Note, including in reasonable detail a description of such action and the reason therefor.
(b) Payments.
Whenever any payment of cash is to be made by the Company to any Person pursuant to this Note, such payment shall be made in lawful money
of the United States of America via wire transfer of immediately available funds to an account designated by the Holder; provided,
that the Holder, upon written notice to the Company, may elect to receive a payment of cash in lawful money of the United States of America
by a check drawn on the account of the Company and sent via overnight courier service to such Person at such address as previously provided
to the Company in writing (which address, in the case of each of the Purchasers, shall initially be as set forth on the signature pages
attached to the Securities Purchase Agreement). Whenever any amount expressed to be due by the terms of this Note is due on any day which
is not a Business Day, the same shall instead be due on the next succeeding day which is a Business Day.
(25) CANCELLATION.
After all Principal, any accrued Interest and any other amounts at any time owed on this Note have been paid in full, this Note shall
automatically be deemed canceled and shall not be reissued, sold or transferred.
(26) WAIVER
OF NOTICE. To the extent permitted by law, the Company hereby waives demand, notice, protest and all other demands and notices in
connection with the delivery, acceptance, performance, default or enforcement of this Note and the Securities Purchase Agreement.
(27) GOVERNING
LAW; JURISDICTION; JURY TRIAL. This Note shall be governed by and construed and enforced in accordance with, and all questions concerning
the construction, validity, interpretation and performance of this Note shall be governed by, the internal laws of the State of New York,
without giving effect to any choice of law or conflict of law provision or rule (whether of the State of New York or any other jurisdictions)
that would cause the application of the laws of any jurisdictions other than the State of New York. The Company hereby irrevocably submits
to the exclusive jurisdiction of the state and federal courts sitting in The City of New York, Borough of Manhattan, for the adjudication
of any dispute hereunder or in connection herewith or with any transaction contemplated hereby or discussed herein, and hereby irrevocably
waives, and agrees not to assert in any suit, action or proceeding, any claim that it is not personally subject to the jurisdiction of
any such court, that such suit, action or proceeding is brought in an inconvenient forum or that the venue of such suit, action or proceeding
is improper. The Company hereby irrevocably waives personal service of process and consents to process being served in any such suit,
action or proceeding by mailing a copy thereof to the Company at the address set forth on the Company’s signature page to the Securities
Purchase Agreement and agrees that such service shall constitute good and sufficient service of process and notice thereof. Nothing contained
herein shall be deemed to limit in any way any right to serve process in any manner permitted by law. Nothing contained herein shall be
deemed or operate to preclude the Holder from bringing suit or taking other legal action against the Company in any other jurisdiction
to collect on the Company’s obligations to the Holder, to realize on any collateral or any other security for such obligations, or to
enforce a judgment or other court ruling in favor of the Holder. THE COMPANY HEREBY IRREVOCABLY WAIVES ANY RIGHT IT MAY HAVE TO, AND
AGREES NOT TO REQUEST, A JURY TRIAL FOR THE ADJUDICATION OF ANY DISPUTE HEREUNDER OR IN CONNECTION WITH OR ARISING OUT OF THIS NOTE OR
ANY TRANSACTION CONTEMPLATED HEREBY.
(28) Severability.
If any provision of this Note is prohibited by law or otherwise determined to be invalid or unenforceable by a court of competent jurisdiction,
the provision that would otherwise be prohibited, invalid or unenforceable shall be deemed amended to apply to the broadest extent that
it would be valid and enforceable, and the invalidity or unenforceability of such provision shall not affect the validity of the remaining
provisions of this Note so long as this Note as so modified continues to express, without material change, the original intentions of
the Company and the Holder as to the subject matter hereof and the prohibited nature, invalidity or unenforceability of the provision(s)
in question does not substantially impair the respective expectations or reciprocal obligations of the Company or the Holder or the practical
realization of the benefits that would otherwise be conferred upon the Company or the Holder. The Company and the Holder will endeavor
in good faith negotiations to replace the prohibited, invalid or unenforceable provision(s) with a valid provision(s), the effect of which
comes as close as possible to that of the prohibited, invalid or unenforceable provision(s).
(29) DISCLOSURE.
Upon receipt or delivery by the Company of any notice in accordance with the terms of this Note, unless the Company has in good faith
determined that the matters relating to such notice do not constitute material, nonpublic information relating to the Company or its Subsidiaries,
the Company shall contemporaneously with any such receipt or delivery publicly disclose such material, nonpublic information on a Current
Report on Form 8-K or otherwise. In the event that the Company believes that a notice contains material, nonpublic information relating
to the Company or its Subsidiaries, the Company so shall indicate to the Holder contemporaneously with delivery of such notice, and in
the absence of any such indication, the Holder shall be allowed to presume that all matters relating to such notice do not constitute
material, nonpublic information relating to the Company or its Subsidiaries.
(30) USURY.
This Note is subject to the express condition that at no time shall the Company be obligated or required to pay interest hereunder at
a rate or in an amount which could subject the Holder to either civil or criminal liability as a result of being in excess of the maximum
interest rate or amount which the Company is permitted by applicable law to contract or agree to pay. If by the terms of this Note, the
Company is at any time required or obligated to pay interest hereunder, including by way of an original issue discount, at a rate or in
an amount in excess of such maximum rate or amount, the rate or amount of interest under this Note shall be deemed to be immediately reduced
to such maximum rate or amount and the interest payable shall be computed at such maximum rate or be in such maximum amount and all prior
interest payments in excess of such maximum rate or amount shall be applied and shall be deemed to have been payments in reduction of
the principal balance of this Note.
(31) CERTAIN
DEFINITIONS. For purposes of this Note, the following terms shall have the following meanings:
(a) “Affiliate”
shall have the meaning ascribed to such term in Rule 405 of the Securities Act.
(b) “Business
Day” means any day other than Saturday, Sunday or other day on which commercial banks in The City of New York are authorized
or required by law to remain closed; provided, however, for clarification, commercial banks shall not be deemed to be authorized
or required by law to remain closed due to “stay at home”, “shelter-in-place”, “non-essential employee”
or any other similar orders or restrictions or the closure of any physical branch locations at the direction of any governmental authority
so long as the electronic funds transfer systems (including for wire transfers) of commercial banks in The City of New York, New York
generally are open for use by customers on such day.
(c) “Change
of Control” means any Fundamental Transaction other than (i) any reorganization, recapitalization or reclassification of the
Common Stock in which holders of the Company’s voting power immediately prior to such reorganization, recapitalization or reclassification
continue after such reorganization, recapitalization or reclassification to hold publicly traded securities and, directly or indirectly,
are the holders of a majority of the voting power of the surviving entity (or entities with the authority or voting power to elect the
members of the board of directors (or their equivalent if other than a corporation) of such entity or entities) after such reorganization,
recapitalization or reclassification or (ii) pursuant to a migratory merger effected solely for the purpose of changing the jurisdiction
of incorporation of the Company.
(d) “Closing
Date” shall mean the date is the date the Company initially issued the Notes.
(e) “Common
Stock” means (i) the Company’s shares of common stock, par value $0.001 per share, and (ii) any capital stock into
which such Common Stock shall be changed or any capital stock resulting from a reorganization, recapitalization or reclassification of
such Common Stock.
(f) “Contingent
Obligation” means, as to any Person, any direct or indirect liability, contingent or otherwise, of that Person with respect
to any Indebtedness, lease, dividend or other obligation of another Person if the primary purpose or intent of the Person incurring such
liability, or the primary effect thereof, is to provide assurance to the obligee of such liability that such liability will be paid or
discharged, or that any agreements relating thereto will be complied with, or that the holders of such liability will be protected (in
whole or in part) against loss with respect thereto.
(g) “Convertible
Securities” means any stock or securities (other than Options) directly or indirectly convertible into or exercisable or exchangeable
for shares of Common Stock.
(h) “Equity
Interests” means (a) all shares of capital stock (whether denominated as common capital stock or preferred capital stock), equity
interests, beneficial, partnership or membership interests, joint venture interests, participations or other ownership or profit interests
in or equivalents (regardless of how designated) of or in a Person (other than an individual), whether voting or non-voting and (b) all
securities convertible into or exchangeable for any of the foregoing and all warrants, Options or other rights to purchase, subscribe
for or otherwise acquire any of the foregoing, whether or not presently convertible, exchangeable or exercisable.
(i) “Exchange
Act” means the Securities Exchange Act of 1934, as amended.
(j) “Fundamental
Transaction” means (A) that the Company shall, directly or indirectly, including through Subsidiaries, Affiliates or otherwise,
in one or more related transactions, (i) consolidate or merge with or into (whether or not the Company is the surviving corporation) another
Subject Entity, or (ii) sell, assign, transfer, convey or otherwise dispose of all or substantially all of the properties or assets of
the Company or any of its “significant subsidiaries” (as defined in Rule 1-02 of Regulation S-X) to one or more Subject Entities,
or (iii) make, or allow one or more Subject Entities to make, or allow the Company to be subject to or have its Common Stock be subject
to or party to one or more Subject Entities making, a purchase, tender or exchange offer that is accepted by the holders of at least either
(x) 50% of the outstanding shares of Common Stock, (y) 50% of the outstanding shares of Common Stock calculated as if any shares of Common
Stock held by all Subject Entities making or party to, or Affiliated with any Subject Entities making or party to, such purchase, tender
or exchange offer were not outstanding; or (z) such number of shares of Common Stock such that all Subject Entities making or party to,
or Affiliated with any Subject Entity making or party to, such purchase, tender or exchange offer, become collectively the beneficial
owners (as defined in Rule 13d-3 under the Exchange Act) of at least 50% of the outstanding shares of Common Stock, or (iv) consummate
a stock purchase agreement or other business combination (including, without limitation, a reorganization, recapitalization, spin-off
or scheme of arrangement) with one or more Subject Entities whereby such Subject Entities, individually or in the aggregate, acquire,
either (x) at least 50% of the outstanding shares of Common Stock, (y) at least 50% of the outstanding shares of Common Stock calculated
as if any shares of Common Stock held by all the Subject Entities making or party to, or Affiliated with any Subject Entity making or
party to, such stock purchase agreement or other business combination were not outstanding; or (z) such number of shares of Common Stock
such that the Subject Entities become collectively the beneficial owners (as defined in Rule 13d-3 under the Exchange Act) of at least
50% of the outstanding shares of Common Stock, or (v) reorganize, recapitalize or reclassify its Common Stock, (B) that the Company shall,
directly or indirectly, including through Subsidiaries, Affiliates or otherwise, in one or more related transactions allow any Subject
Entity individually or the Subject Entities in the aggregate to be or become the “beneficial owner” (as defined in Rule 13d-3
under the Exchange Act), directly or indirectly, whether through acquisition, purchase, assignment, conveyance, tender, tender offer,
exchange, reduction in outstanding shares of Common Stock, merger, consolidation, business combination, reorganization, recapitalization,
spin-off, scheme of arrangement, reorganization, recapitalization or reclassification or otherwise in any manner whatsoever, of either
(x) at least 50% of the aggregate ordinary voting power represented by issued and outstanding Common Stock, (y) at least 50% of the aggregate
ordinary voting power represented by issued and outstanding Common Stock not held by all such Subject Entities as of the Subscription
Date calculated as if any shares of Common Stock held by all such Subject Entities were not outstanding, or (z) a percentage of the aggregate
ordinary voting power represented by issued and outstanding shares of Common Stock or other equity securities of the Company sufficient
to allow such Subject Entities to effect a statutory short form merger or other transaction requiring other stockholders of the Company
to surrender their shares of Common Stock without approval of the stockholders of the Company or (C) that the Company shall, directly
or indirectly, including through Subsidiaries, Affiliates or otherwise, in one or more related transactions, the issuance of or the entering
into any other instrument or transaction structured in a manner to circumvent, or that circumvents, the intent of this definition in which
case this definition shall be construed and implemented in a manner otherwise than in strict conformity with the terms of this definition
to the extent necessary to correct this definition or any portion of this definition which may be defective or inconsistent with the intended
treatment of such instrument or transaction.
(k) “GAAP”
means United States generally accepted accounting principles, consistently applied during the periods involved.
(l) “Group”
means a “group” as that term is used in Section 13(d) of the Exchange Act and as defined in Rule 13d-5 thereunder.
(m) “Indebtedness”
of any Person means, without duplication (i) all indebtedness for borrowed money, (ii) all obligations issued, undertaken or assumed as
the deferred purchase price of property or services, including (without limitation) “finance leases” in accordance with GAAP
(other than trade payables entered into in the ordinary course of business consistent with past practice), (iii) all reimbursement or
payment obligations with respect to letters of credit, surety bonds and other similar instruments, (iv) all obligations evidenced by notes,
bonds, debentures or similar instruments, including obligations so evidenced incurred in connection with the acquisition of property,
assets or businesses, (v) all indebtedness created or arising under any conditional sale or other title retention agreement, or incurred
as financing, in either case with respect to any property or assets acquired with the proceeds of such indebtedness (even though the rights
and remedies of the seller or bank under such agreement in the event of default are limited to repossession or sale of such property),
(vi) all monetary obligations under any leasing or similar arrangement which, in connection with GAAP, is classified as a finance lease,
(vii) all indebtedness referred to in clauses (i) through (vi) above secured by (or for which the holder of such Indebtedness has an existing
right, contingent or otherwise, to be secured by) any mortgage, deed of trust, lien, pledge, charge, security interest or other encumbrance
of any nature whatsoever in or upon any property or assets (including accounts and contract rights) with respect to any asset or property
owned by any Person, even though the Person which owns such assets or property has not assumed or become liable for the payment of such
indebtedness, and (vii) all Contingent Obligations in respect of indebtedness or obligations of others of the kinds referred to in clauses
(i) through (vii) above.
(n) “Intellectual
Property Rights” shall have the meaning ascribed to such term in the Securities Purchase Agreement.
(o) “Material
Adverse Effect” shall have the meaning ascribed to such term in the Securities Purchase Agreement.
(p) “Options”
means any rights, warrants or options to subscribe for or purchase (i) shares of Common Stock or (ii) Convertible Securities.
(q) “Permitted
Indebtedness” means (i) Indebtedness evidenced by this Note and the Other Notes, (ii) Indebtedness set forth on Schedule 31(q),
(iii) trade payables incurred in the ordinary course of business and consistent with past practice and (iv) unsecured Indebtedness incurred
by the Company that is made expressly subordinate in right of payment to the Indebtedness evidenced by this Note, as reflected in a written
agreement acceptable to the Required Holders and approved by the Required Holders in writing, and which Indebtedness (a) does not provide
at any time for the payment, prepayment, repayment, repurchase or defeasance, directly or indirectly, of any principal or premium, if
any, thereon until ninety-one (91) days after the Maturity Date or later and (b) includes terms and conditions acceptable to the Required
Holders.
(r) “Permitted
Liens” means (i) Liens set forth on Schedule 31(r), (ii) any Lien for taxes not yet due or delinquent or being contested in
good faith by appropriate proceedings for which adequate reserves have been established in accordance with GAAP, (iii) any statutory Lien
arising in the ordinary course of business by operation of law with respect to a liability that is not yet due or delinquent, (iv) any
Lien created by operation of law, such as materialmen’s liens, mechanics’ liens and other similar liens, arising in the ordinary course
of business with respect to a liability that is not yet due or delinquent or that are being contested in good faith by appropriate proceedings,
(v) Liens (A) upon or in any equipment acquired or held by the Company or any of its Subsidiaries to secure the purchase price of such
equipment or Indebtedness incurred solely for the purpose of financing the acquisition or lease of such equipment, or (B) existing on
such equipment at the time of its acquisition, provided that the Lien is confined solely to the property so acquired and improvements
thereon, and the proceeds of such equipment, (vi) leases or subleases and licenses and sublicenses granted to others in the ordinary course
of the Company’s business, not interfering in any material respect with the business of the Company and its Subsidiaries taken as a whole,
(vii) Liens in favor of customs and revenue authorities arising as a matter of law to secure payments of custom duties in connection
with the importation of goods and (vii) Liens arising from judgments, decrees or attachments in circumstances not constituting an Event
of Default under Section 4(a)(ix).
(s) “Person”
means an individual, a limited liability company, a partnership, a joint venture, a corporation, a trust, an unincorporated organization,
any other entity and any governmental entity or any department or agency thereof.
(t) “Purchaser”
shall have the meaning ascribed to such term in the Securities Purchase Agreement.
(u) “Redemption
Dates” means, collectively, the Event of Default Redemption Dates and the Change of Control Redemption Dates and the Optional
Prepayment Date, as applicable, each of the foregoing, individually, a Redemption Date.
(v) “Redemption
Notices” means, collectively, the Event of Default Redemption Notices and the Change of Control Redemption Notices and the Optional
Prepayment Notice, each of the foregoing, individually, a Redemption Notice.
(w) “Redemption
Premium” means 125%.
(x) “Redemption
Prices” means, collectively, the Event of Default Redemption Prices and the Change of Control Redemption Prices and the Note
Amount being prepaid upon any Optional Prepayment, each of the foregoing, individually, a Redemption Price.
(y) “Related
Fund” means, with respect to any Person, a fund or account managed by such Person or an Affiliate of such Person.
(z) “Required
Holders” means the holders of Notes representing at least a majority of the aggregate principal amount of the Notes then outstanding.
(aa) “SEC”
means the United States Securities and Exchange Commission.
(bb) “Securities
Act” means the Securities Act of 1933, as amended.
(cc) “Securities
Purchase Agreement” means that certain securities purchase agreement dated as of the Subscription Date by and among the Company
and the investors listed on the signature pages attached thereto pursuant to which the Company issued the Notes, as may be amended, amended
and restated, supplemented or otherwise modified from time to time.
(dd) “Subject
Entity” means any Person, Persons or Group or any Affiliate or associate of any such Person, Persons or Group.
(ee) “Subscription
Date” means July 8, 2024.
(ff) “Subsidiary”
shall have the meaning ascribed to such term in the Securities Purchase Agreement.
(gg) “Transaction
Documents” shall have the meaning ascribed to such term in the Securities Purchase Agreement.
[Signature Page Follows]
IN WITNESS WHEREOF, the Company
has caused this Note to be duly executed as of the Issuance Date set out above.
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Aditxt, Inc. |
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By: |
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Name: |
Amro Albanna |
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Title: |
Chief Executive Officer |
- 21 -
Exhibit 10.4
SECURITIES PURCHASE
AGREEMENT
This SECURITIES PURCHASE
AGREEMENT (the “Agreement”), dated as of July 12, 2024 is by and among Evofem Biosciences, Inc., a Delaware corporation
with offices located at 7770 Regents Road, Suite 113-618, San Diego, CA 92122 (the “Company”), and Aditxt, Inc. (the
“Buyer”).
RECITALS
A. The
Company and the Buyer are executing and delivering this Agreement in reliance upon the exemption from securities registration afforded
by Section 4(a)(2) of the Securities Act of 1933, as amended (the “1933 Act”).
B. The
Company has authorized a new series of convertible preferred stock of the Company designated as Series F-1 Convertible Preferred Stock,
$0.0001 par value, the terms of which are set forth in the amended and restated certificate of designation for such series of Preferred
Stock (the “Certificate of Designations”) in the form attached hereto as Exhibit A (together with any
convertible preferred shares issued in replacement thereof in accordance with the terms thereof, the “Series F-1 Preferred Stock”),
which Series F-1 Preferred Stock shall be convertible into shares of its Common Stock, par value $0.0001 per share (“Common Stock”,
and such shares of Common Stock issuable pursuant to the terms of the Certificate of Designations, including, without limitation, upon
conversion or otherwise, collectively, the “Conversion Shares”), in accordance with the terms of the Certificate of
Designations.
C. The
Buyer wishes to purchase, and the Company wishes to sell, upon the terms and conditions stated in this Agreement, (i) the aggregate number
of shares of Series F-1 Preferred Stock (the “Preferred Shares”) set forth opposite the Buyer’s name in column
(3) on the Schedule of Buyers.
D. At
the Closing, the parties hereto shall execute and deliver a Registration Rights Agreement, in the form attached hereto as Exhibit
C (the “Registration Rights Agreement”), pursuant to which the Company has agreed to provide certain registration
rights with respect to the Registrable Securities (as defined in the Registration Rights Agreement), under the 1933 Act and the rules
and regulations promulgated thereunder, and applicable state securities laws.
D. The
Preferred Shares and the Conversion Shares are collectively referred to herein as the “Securities.”
AGREEMENT
NOW, THEREFORE, in consideration
of the premises and the mutual covenants contained herein and for other good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the Company and the Buyer hereby agree as follows:
1. PURCHASE
AND SALE OF PREFERRED SHARES.
(a) Purchase of Preferred
Shares. Subject to the satisfaction (or waiver) of the conditions set forth in Sections 6 and 7 below, on the date hereof (the “Closing
Date”) the Company shall issue and sell to the Buyer, and the Buyer agrees to purchase from the Company on the Closing Date the
aggregate number of Preferred Shares as is set forth opposite the Buyer’s name in column (3) on the Schedule of Buyers.
(b) Closing. The closing
(the “Closing”) of the purchase of the Preferred Shares by the Buyer shall occur at the offices of Sheppard, Mullin,
Richter & Hampton LLP, 30 Rockefeller Plaza, New York, NY 10112-0015 on the Closing Date. As used herein “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 generally are open for use by customers on such day.
(c) Purchase Price.
The aggregate purchase price for the Preferred Shares to be purchased by the Buyer (the “Purchase Price”) shall be
the amount set forth opposite the Buyer’s name in column (5) on the Schedule of Buyers.
(d) Form of Payment.
On the Closing Date, (i) the Buyer shall pay its Purchase Price to the Company for the Preferred Shares to be issued and sold to the
Buyer at the Closing, by wire transfer of immediately available funds in accordance with the Flow of Funds Letter (as defined below)
and (ii) the Company shall deliver to the Buyer (A) the aggregate number of Preferred Shares as is set forth opposite the Buyer’s
name in column (3) of the Schedule of Buyers, duly executed on behalf of the Company and registered in the name of the Buyer or its designee.
2. BUYER’S
REPRESENTATIONS AND WARRANTIES.
The Buyer represents and warrants
to the Company that as of the date hereof:
(a) Organization;
Authority. The Buyer is an entity duly organized, validly existing and in good standing under the laws of the jurisdiction of its
organization with the requisite power and authority to enter into and to consummate the transactions contemplated by the Transaction Documents
(as defined below) to which it is a party and otherwise to carry out its obligations hereunder and thereunder.
(b) No Public Sale or
Distribution. The Buyer (i) is acquiring its Preferred Shares, (ii) upon conversion of its Preferred Shares will acquire the Conversion
Shares issuable upon conversion thereof, for its own account and not with a view towards, or for resale in connection with, the public
sale or distribution thereof in violation of applicable securities laws, except pursuant to sales registered or exempted under the 1933
Act; provided, however, by making the representations herein, the Buyer does not agree, or make any representation or warranty, to hold
any of the Securities for any minimum or other specific term and reserves the right to dispose of the Securities at any time in accordance
with or pursuant to a registration statement or an exemption from registration under the 1933 Act. The Buyer does not presently have
any agreement or understanding, directly or indirectly, with any Person to distribute any of the Securities in violation of applicable
securities laws. For purposes of this Agreement, “Person” means an individual, a limited liability company, a partnership,
a joint venture, a corporation, a trust, an unincorporated organization, any other entity and any Governmental Entity or any department
or agency thereof.
(c) Omitted.
(d) Reliance on Exemptions.
The Buyer understands that the Securities are being offered and sold to it in reliance on specific exemptions from the registration requirements
of United States federal and state securities laws and that the Company is relying in part upon the truth and accuracy of, and such Buyer’s
compliance with, the representations, warranties, agreements, acknowledgments and understandings of the Buyer set forth herein in order
to determine the availability of such exemptions and the eligibility of the Buyer to acquire the Securities.
(e) Information. The
Buyer and its advisors, if any, have been furnished with all materials relating to the business, finances and operations of the Company
and materials relating to the offer and sale of the Securities that have been requested by such Buyer and/or included in the SEC Documents
(as hereinafter defined). The Buyer and its advisors, if any, have been afforded the opportunity to ask questions of the Company. Neither
such inquiries nor any other due diligence investigations conducted by the Buyer or its advisors, if any, or its representatives shall
modify, amend or affect the Buyer’s right to rely on the Company’s representations and warranties contained herein. The Buyer
understands that its investment in the Securities involves a high degree of risk. The Buyer has sought such accounting, legal and tax
advice as it has considered necessary to make an informed investment decision with respect to its acquisition of the Securities.
(f) No Governmental Review.
The Buyer understands that no United States federal or state agency or any other government or governmental agency has passed on or made
any recommendation or endorsement of the Securities or the fairness or suitability of the investment in the Securities nor have such
authorities passed upon or endorsed the merits of the offering of the Securities.
(g) Transfer or
Resale. The Buyer understands that except as provided in the Registration Rights Agreement and Section 4(h) hereof: (i) the
Securities have not been and are not being registered under the 1933 Act or any state securities laws, and may not be offered for
sale, sold, assigned or transferred unless (A) subsequently registered thereunder, (B) the Buyer shall have delivered to the Company
(if requested by the Company) an opinion of counsel, in a form reasonably acceptable to the Company, to the effect that such
Securities to be sold, assigned or transferred may be sold, assigned or transferred pursuant to an exemption from such registration,
or (C) the Buyer provides the Company with reasonable assurance that such Securities can be sold, assigned or transferred pursuant
to Rule 144 or Rule 144A promulgated under the 1933 Act (or a successor rule thereto) (collectively, “Rule 144”);
(ii) any sale of the Securities made in reliance on Rule 144 may be made only in accordance with the terms of Rule 144, and further,
if Rule 144 is not applicable, any resale of the Securities under circumstances in which the seller (or the Person through whom the
sale is made) may be deemed to be an underwriter (as that term is defined in the 1933 Act) may require compliance with some other
exemption under the 1933 Act or the rules and regulations of the United States Securities Commission (the “SEC”)
promulgated thereunder; and (iii) neither the Company nor any other Person is under any obligation to register the Securities under
the 1933 Act or any state securities laws or to comply with the terms and conditions of any exemption thereunder.
(h) Validity; Enforcement.
This Agreement and the Registration Rights have been duly and validly authorized, executed and delivered on behalf of the Buyer and shall
constitute the legal, valid and binding obligations of the Buyer enforceable against the Buyer in accordance with their respective terms,
except as such enforceability may be limited by general principles of equity or to applicable bankruptcy, insolvency, reorganization,
moratorium, liquidation and other similar laws relating to, or affecting generally, the enforcement of applicable creditors’ rights
and remedies.
(i) No Conflicts.
The execution, delivery and performance by such Buyer of this Agreement and the Registration Rights Agreement and the consummation by
such Buyer of the transactions contemplated hereby and thereby will not (i) result in a violation of the organizational documents of
such Buyer, or (ii) conflict with, or constitute a default (or an event which with notice or lapse of time or both would become a default)
under, or give to others any rights of termination, amendment, acceleration or cancellation of, any agreement, indenture or instrument
to which such Buyer is a party, or (iii) result in a violation of any law, rule, regulation, order, judgment or decree (including federal
and state securities laws) applicable to such Buyer, except in the case of clauses (ii) and (iii) above, for such conflicts, defaults,
rights or violations which could not, individually or in the aggregate, reasonably be expected to have a material adverse effect on the
ability of such Buyer to perform its obligations hereunder.
3. REPRESENTATIONS
AND WARRANTIES OF THE COMPANY.
The Company represents and
warrants to the Buyer that as of the date hereof:
(a) Organization and Qualification.
Each of the Company and each of its Subsidiaries are entities duly organized and validly existing and in good standing under the laws
of the jurisdiction in which they are formed, and have the requisite power and authority to own their properties and to carry on their
business as now being conducted and as presently proposed to be conducted. Each of the Company and each of its Subsidiaries is duly qualified
as a foreign entity to do business and is in good standing in every jurisdiction in which its ownership of property or the nature of
the business conducted by it makes such qualification necessary, except to the extent that the failure to be so qualified or be in good
standing would not reasonably be expected to have a Material Adverse Effect (as defined below). As used in this Agreement, “Material
Adverse Effect” means any material adverse effect on (i) the business, properties, assets, liabilities, operations (including
results thereof), condition (financial or otherwise) or prospects of the Company or any Subsidiary, individually or taken as a whole,
(ii) the transactions contemplated hereby or in any of the other Transaction Documents or any other agreements or instruments to be entered
into in connection herewith or therewith or (iii) the authority or ability of the Company or any of its Subsidiaries to perform any of
their respective obligations under any of the Transaction Documents (as defined below). Other than the Persons (as defined below) set
forth on Schedule 3(a), the Company has no Subsidiaries. “Subsidiaries” means any Person in which the Company,
directly or indirectly, (I) owns any of the outstanding capital stock or holds any equity or similar interest of such Person or (II)
controls or operates all or any part of the business, operations or administration of such Person, and each of the foregoing, is individually
referred to herein as a “Subsidiary.”
(b) Authorization; Enforcement;
Validity. The Company has the requisite power and authority to enter into and perform its obligations under this Agreement and the
other Transaction Documents and to issue the Securities in accordance with the terms hereof and thereof. Each Subsidiary has the requisite
power and authority to enter into and perform its obligations under the Transaction Documents to which it is a party. The execution and
delivery of this Agreement and the other Transaction Documents by the Company, and the consummation by the Company of the transactions
contemplated hereby and thereby (including, without limitation, the issuance of the Preferred Shares and the reservation for issuance
and issuance of the Conversion Shares issuable upon conversion of the Preferred Shares and the reservation for issuance) have been duly
authorized by the Company’s board of directors or other governing body, as applicable, and (other than the filing with the SEC
of one or more Registration Statements in accordance with the requirements of the Registration Rights Agreement, a Form D with the SEC
and any filings as may be required by any state securities agencies) no further filing, consent or authorization is required by the Company,
its Subsidiaries, their respective boards of directors or their stockholders or other governing body. This Agreement has been, and the
other Transaction Documents to which it is a party will be prior to the Closing, duly executed and delivered by the Company, and each
constitutes the legal, valid and binding obligations of the Company, enforceable against the Company in accordance with its respective
terms, except as such enforceability may be limited by general principles of equity or applicable bankruptcy, insolvency, reorganization,
moratorium, liquidation or similar laws relating to, or affecting generally, the enforcement of applicable creditors’ rights and
remedies and except as rights to indemnification and to contribution may be limited by federal or state securities law. The Certificate
of Designations in the form attached hereto as Exhibit A has been filed with the Secretary of State of the State of Delaware and is in
full force and effect, enforceable against the Company in accordance with its terms and has not have been amended. “Transaction
Documents” means, collectively, this Agreement, the Preferred Shares, the Certificate of Designations, the Registration Rights
Agreement, the Irrevocable Transfer Agent Instructions (as defined below) and each of the other agreements and instruments entered into
or delivered by any of the parties hereto in connection with the transactions contemplated hereby and thereby, as may be amended from
time to time.
(c) Issuance of Securities.
The issuance of the Preferred Shares are duly authorized and upon issuance in accordance with the terms of the Transaction Documents
shall be validly issued, fully paid and non-assessable and free from all preemptive or similar rights, mortgages, defects, claims, liens,
pledges, charges, taxes, rights of first refusal, encumbrances, security interests and other encumbrances (collectively “Liens”)
with respect to the issuance thereof. As of the Closing, the Company shall have reserved from its duly authorized capital stock not less
than the sum of (i) 150% of the maximum number of Conversion Shares issuable upon conversion of the Preferred Shares (assuming for purposes
hereof that (x) the Preferred Shares are convertible at the Alternate Conversion Price (as defined in the Certificate of Designations)
assuming an Alternate Conversion Date (as defined in the Certificate of Designations) as of the date hereof, and (y) any such conversion
shall not take into account any limitations on the conversion of the Preferred Shares set forth in the Certificate of Designations).
Upon issuance or conversion in accordance with the Preferred, the Conversion Shares, when issued, will be validly issued, fully paid
and nonassessable and free from all preemptive or similar rights or Liens with respect to the issue thereof, with the holders being entitled
to all rights accorded to a holder of Common Stock. Subject to the accuracy of the representations and warranties of the Buyer in this
Agreement, the offer and issuance by the Company of the Securities is exempt from registration under the 1933 Act.
(d) No Conflicts.
Except as disclosed in the SEC Documents and/or Schedule 3(d), the execution, delivery and performance of the Transaction Documents by
the Company and the consummation by the Company of the transactions contemplated hereby and thereby (including, without limitation, the
issuance of the Preferred Shares, the Conversion Shares and the reservation for issuance of the Conversion Shares will not (i) result
in a violation of the Certificate of Incorporation (as defined below) (including, without limitation, any certificate of designation
contained therein), Bylaws (as defined below), certificate of formation, memorandum of association, articles of association, bylaws or
other organizational documents of the Company or any of its Subsidiaries, or any capital stock or other securities of the Company or
any of its Subsidiaries, (ii) conflict with, or constitute a default (or an event which with notice or lapse of time or both would become
a default) in any respect under, or give to others any rights of termination, amendment, acceleration or cancellation of, any agreement,
indenture or instrument to which the Company or any of its Subsidiaries is a party, or (iii) result in a violation of any law, rule,
regulation, order, judgment or decree (including, without limitation, foreign, federal and state securities laws and regulations and
the rules and regulations of OTCQB (the “Principal Market”) and including all applicable foreign, federal and state
laws, rules and regulations) applicable to the Company or any of its Subsidiaries or by which any property or asset of the Company or
any of its Subsidiaries is bound or affected.
(e) Consents. Except
for disclosed on the SEC Documents and/or Schedule 3(e), neither the Company nor any Subsidiary is required to obtain any consent from,
authorization or order of, or make any filing or registration with (other than the filing with the SEC of one or more Registration Statements
in accordance with the requirements of the Registration Rights Agreement, a Form D with the SEC and any other filings as may be required
by any state securities agencies), any Governmental Entity (as defined below) or any regulatory or self-regulatory agency or any other
Person in order for it to execute, deliver or perform any of its respective obligations under or contemplated by the Transaction Documents,
in each case, in accordance with the terms hereof or thereof. All consents, authorizations, orders, filings and registrations which the
Company or any Subsidiary is required to obtain pursuant to the preceding sentence have been or will be obtained or effected on or prior
to the Closing Date, and neither the Company nor any of its Subsidiaries are aware of any facts or circumstances which might prevent
the Company or any of its Subsidiaries from obtaining or effecting any of the registration, application or filings contemplated by the
Transaction Documents. The Company is not in violation of the requirements of the Principal Market and has no knowledge of any facts
or circumstances which could reasonably lead to delisting or suspension of the Common Stock in the foreseeable future. “Governmental
Entity” means any nation, state, county, city, town, village, district, or other political jurisdiction of any nature, federal,
state, local, municipal, foreign, or other government, governmental or quasi-governmental authority of any nature (including any governmental
agency, branch, department, official, or entity and any court or other tribunal), multi-national organization or body; or body exercising,
or entitled to exercise, any administrative, executive, judicial, legislative, police, regulatory, or taxing authority or power of any
nature or instrumentality of any of the foregoing, including any entity or enterprise owned or controlled by a government or a public
international organization or any of the foregoing.
(f) Acknowledgment Regarding
Buyer’s Purchase of Securities. The Company acknowledges and agrees that the Buyer is acting solely in the capacity of an arm’s
length purchaser with respect to the Transaction Documents and the transactions contemplated hereby and thereby and that the Buyer is
not (i) an officer or director of the Company or any of its Subsidiaries, (ii) an “affiliate” (as defined in Rule 144) of
the Company or any of its Subsidiaries or (iii) to its knowledge, a “beneficial owner” of more than 10% of the shares of
Common Stock (as defined for purposes of Rule 13d-3 of the Securities Exchange Act of 1934, as amended (the “1934 Act”)).
The Company further acknowledges that the Buyer is not acting as a financial advisor or fiduciary of the Company or any of its Subsidiaries
(or in any similar capacity) with respect to the Transaction Documents and the transactions contemplated hereby and thereby, and any
advice given by the Buyer or any of its representatives or agents in connection with the Transaction Documents and the transactions contemplated
hereby and thereby is merely incidental to the Buyer’s purchase of the Securities. The Company further represents to the Buyer
that the Company’s and each Subsidiary’s decision to enter into the Transaction Documents to which it is a party has been
based solely on the independent evaluation by the Company, each Subsidiary and their respective representatives.
(g) No General Solicitation;
No Placement Agent’s Fees. Neither the Company, nor any of its Subsidiaries or affiliates, nor any Person acting on its or
their behalf, has engaged in any form of general solicitation or general advertising (within the meaning of Regulation D) in connection
with the offer or sale of the Securities. The Company shall be responsible for the payment of any placement agent’s fees, financial
advisory fees, or brokers’ commissions (other than for Persons engaged by the Buyer or its investment advisor) relating to or arising
out of the transactions contemplated hereby. The Company shall pay, and hold the Buyer harmless against, any liability, loss or expense
(including, without limitation, attorney’s fees and out-of-pocket expenses) arising in connection with any such claim. Neither
the Company nor any of its Subsidiaries has engaged any placement agent or other agent in connection with the offer or sale of the Securities.
(h) No Integrated Offering.
None of the Company, its Subsidiaries or any of their affiliates, nor any Person acting on 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 require registration
of the issuance of any of the Securities under the 1933 Act, whether through integration with prior offerings or otherwise, or cause
this offering of the Securities to require approval of stockholders of the Company for purposes of the 1933 Act or under any applicable
stockholder approval provisions, including, without limitation, under the rules and regulations of any exchange or automated quotation
system on which any of the securities of the Company are listed or designated for quotation. None of the Company, its Subsidiaries, their
affiliates nor any Person acting on their behalf will take any action or steps that would require registration of the issuance of any
of the Securities under the 1933 Act or cause the offering of any of the Securities to be integrated with other offerings of securities
of the Company.
(i) Dilutive Effect.
The Company understands and acknowledges that the number of Conversion Shares will increase in certain circumstances. The Company further
acknowledges that its obligation to issue the Conversion Shares pursuant to the terms of the Preferred Shares in accordance with this
Agreement and the Certificate of Designation in accordance with this Agreement, in each case, absolute and unconditional regardless of
the dilutive effect that such issuance may have on the ownership interests of other stockholders of the Company.
(j) Omitted.
(k) SEC Documents; Financial
Statements. Except as disclosed on Schedule 3(k), during the two (2) years prior to the date hereof, the Company has timely filed
all reports, schedules, forms, proxy statements, statements and other documents required to be filed by it with the SEC pursuant to the
reporting requirements of the 1934 Act (all of the foregoing filed prior to the date hereof and all exhibits and appendices included
therein and financial statements, notes and schedules thereto and documents incorporated by reference therein being hereinafter referred
to as the “SEC Documents”); reports filed in compliance with the time periods specified in Rule 12b-25 promulgated
under the 1934 Act shall be considered timely for this purpose. When requested, the Company has delivered or has made available to the
Buyer or its representatives true, correct and complete copies of each of the SEC Documents not available on the EDGAR system. As of
their respective dates, the SEC Documents complied in all material respects with the requirements of the 1934 Act and the rules and regulations
of the SEC promulgated thereunder applicable to the SEC Documents, and none of the SEC Documents, at the time they were filed with the
SEC, 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. As of their respective
dates, the financial statements of the Company included in the SEC Documents complied in all material respects with applicable accounting
requirements and the published rules and regulations of the SEC with respect thereto as in effect as of the time of filing. Such financial
statements have been prepared in accordance with generally accepted accounting principles (“GAAP”), consistently applied,
during the periods involved (except (i) as may be otherwise indicated in such financial statements or the notes thereto, or (ii) in the
case of unaudited interim statements, to the extent they may exclude footnotes or may be condensed or summary statements) and fairly
present in all material respects the financial position of the Company as of the dates thereof and the results of its operations and
cash flows for the periods then ended (subject, in the case of unaudited statements, to normal year-end audit adjustments which will
not be material, either individually or in the aggregate). The reserves, if any, established by the Company or the lack of reserves,
if applicable, are reasonable based upon facts and circumstances known by the Company on the date hereof and there are no loss contingencies
that are required to be accrued by the Statement of Financial Accounting Standard No. 5 of the Financial Accounting Standards Board which
are not provided for by the Company in its financial statements or otherwise. No other information provided by or on behalf of the Company
to the Buyer which is not included in the SEC Documents (including, without limitation, information referred to in Section 2(e)
of this Agreement or in the disclosure schedules to this Agreement) contains any untrue statement of a material fact or omits to state
any material fact necessary in order to make the statements therein not misleading, in the light of the circumstance under which they
are or were made. The Company is not currently contemplating to amend or restate any of the financial statements (including, without
limitation, any notes or any letter of the independent accountants of the Company with respect thereto) included in the SEC Documents
(the “Financial Statements”), nor is the Company currently aware of facts or circumstances which would require the
Company to amend or restate any of the Financial Statements, in each case, in order for any of the Financials Statements to be in compliance
with GAAP and the rules and regulations of the SEC. The Company has not been informed by its independent accountants that they recommend
that the Company amend or restate any of the Financial Statements or that there is any need for the Company to amend or restate any of
the Financial Statements.
(l) Absence of Certain
Changes. Except as set forth in the SEC Documents and Schedules hereto, since the date of the Company’s most recent audited
financial statements contained in a Form 10-K, there has been no material adverse change and no material adverse development in the business,
assets, liabilities, properties, operations (including results thereof), condition (financial or otherwise) or prospects of the Company
or any of its Subsidiaries. Except as set forth in the SEC Documents, since the date of the Company’s most recent audited financial
statements contained in a Form 10-K, neither the Company nor any of its Subsidiaries has (i) declared or paid any dividends, (ii) sold
any assets, individually or in the aggregate, outside of the ordinary course of business or (iii) made any capital expenditures, individually
or in the aggregate, outside of the ordinary course of business.
(m) No Undisclosed Events,
Liabilities, Developments or Circumstances. Except as set forth in the Schedules hereto, the SEC Documents or as otherwise disclosed
in writing to the Buyer, no event, liability, development or circumstance has occurred or exists, or is reasonably expected to exist
or occur with respect to the Company, any of its Subsidiaries or any of their respective businesses, properties, liabilities, prospects,
operations (including results thereof) or condition (financial or otherwise), that (i) would be required to be disclosed by the Company
under applicable securities laws on a registration statement on Form S-1 filed with the SEC relating to an issuance and sale by the Company
of its Common Stock and which has not been publicly announced, (ii) has had, or would be reasonably expected to have, a material adverse
effect on the Buyer’s investment hereunder or (iii) has had, or would be reasonably expected to have a Material Adverse Effect.
(n) Conduct of Business;
Regulatory Permits. Neither the Company nor any of its Subsidiaries is in violation of any term of or in default under its Certificate
of Incorporation, any certificate of designation, preferences or rights of any other outstanding series of preferred stock of the Company
or any of its Subsidiaries or Bylaws or their organizational charter, certificate of formation, memorandum of association, articles of
association, Certificate of Incorporation or certificate of incorporation or bylaws, respectively. Neither the Company nor any of its
Subsidiaries is in violation of any judgment, decree or order or any statute, ordinance, rule or regulation applicable to the Company
or any of its Subsidiaries, and neither the Company nor any of its Subsidiaries will conduct its business in violation of any of the
foregoing, except in all cases for violations which have not had, and would not reasonably be expected to have, individually or in the
aggregate, a Material Adverse Effect. Without limiting the generality of the foregoing, and other than as disclosed on the Schedules
hereto, the Company is not in violation of any of the rules, regulations or requirements of the Principal Market and has no knowledge
of any facts or circumstances that could reasonably lead to delisting or suspension of the Common Stock by the Principal Market in the
foreseeable future. During the two years prior to the date hereof, (i) the Common Stock has been listed or designated for quotation on
the Principal Market, (ii) trading in the Common Stock has not been suspended by the SEC or the Principal Market and (iii) except as
disclosed in the SEC Documents, the Company has received no communication, written or oral, from the SEC or the Principal Market regarding
the suspension or delisting of the Common Stock from the Principal Market. The Company and each of its Subsidiaries possess all certificates,
authorizations and permits issued by the appropriate regulatory authorities necessary to conduct their respective businesses, except
where the failure to possess such certificates, authorizations or permits would not have, individually or in the aggregate, a Material
Adverse Effect, and neither the Company nor any such Subsidiary has received any notice of proceedings relating to the revocation or
modification of any such certificate, authorization or permit. Excepts as provided on Schedule 3(n) hereto, there is no agreement, commitment,
judgment, injunction, order or decree binding upon the Company or any of its Subsidiaries or to which the Company or any of its Subsidiaries
is a party which has or would reasonably be expected to have the effect of prohibiting or materially impairing any business practice
of the Company or any of its Subsidiaries, any acquisition of property by the Company or any of its Subsidiaries or the conduct of business
by the Company or any of its Subsidiaries as currently conducted other than such effects, individually or in the aggregate, which have
not had and would not reasonably be expected to have a Material Adverse Effect on the Company or any of its Subsidiaries.
(o) Foreign Corrupt Practices.
Neither the Company, the Company’s subsidiary or any director, officer, agent, employee, nor, to the knowledge of the Company,
any other person acting for or on behalf of the foregoing (individually and collectively, a “Company Affiliate”) have
violated the U.S. Foreign Corrupt Practices Act (the “FCPA”) or any other applicable anti-bribery or anti-corruption
laws, nor has any Company Affiliate offered, paid, promised to pay, or authorized the payment of any money, or offered, given, promised
to give, or authorized the giving of anything of value, to any officer, employee or any other person acting in an official capacity for
any Governmental Entity to any political party or official thereof or to any candidate for political office (individually and collectively,
a “Government Official”) or to any person under circumstances where such Company Affiliate knew or was aware of a
high probability that all or a portion of such money or thing of value would be offered, given or promised, directly or indirectly, to
any Government Official, for the purpose of:
(i) (A)
influencing any act or decision of such Government Official in his/her official capacity, (B) inducing such Government Official to do
or omit to do any act in violation of his/her lawful duty, (C) securing any improper advantage, or (D) inducing such Government Official
to influence or affect any act or decision of any Governmental Entity, or
(ii) assisting
the Company or its Subsidiaries in obtaining or retaining business for or with, or directing business to, the Company or its Subsidiaries.
(p) Sarbanes-Oxley Act.
The Company and each Subsidiary is in compliance with any and all applicable requirements of the Sarbanes-Oxley Act of 2002, as amended,
and any and all applicable rules and regulations promulgated by the SEC thereunder.
(q) Transactions With
Affiliates. Except as disclosed on Schedule 3(q), no current or former employee, partner, director, officer or stockholder of the
Company or its Subsidiaries, or, to the knowledge of the Company, any affiliate of any thereof, or, to the knowledge of the Company,
any member of the immediate family of any of the foregoing, is presently (or in the last twelve months has been) (i) a party to any transaction
with the Company or its Subsidiaries (including any contract, agreement or other arrangement providing for the furnishing of services
by, or rental of real or personal property from, or otherwise requiring payments to, any such director, officer or stockholder or such
associate or affiliate or relative Subsidiaries (other than for ordinary course services as employees, officers or directors of the Company
or any of its Subsidiaries)) or (ii) the direct or indirect owner of an interest in any corporation, firm, association or business organization
which is a competitor, supplier or customer of the Company or its Subsidiaries (except for a passive investment (direct or indirect)
in less than 5% of the common stock of a company whose securities are traded on or quoted through an Eligible Market (as defined in the
Certificate of Designations)), nor does any such Person receive income from any source other than the Company or its Subsidiaries which
relates to the business of the Company or its Subsidiaries or should properly accrue to the Company or its Subsidiaries. No employee,
officer, stockholder or director of the Company or any of its Subsidiaries or member of his or her immediate family is indebted to the
Company or its Subsidiaries, as the case may be, nor is the Company or any of its Subsidiaries indebted (or committed to make loans or
extend or guarantee credit) to any of them, other than (i) for payment of salary or consulting or director fees for services rendered,
(ii) reimbursement for reasonable expenses incurred on behalf of the Company, and (iii) for other standard employee benefits made generally
available to all employees or executives (including in connection with the administration of the Company’s employee stock purchase
plan and stock option agreements outstanding under any stock option plan approved by the board of directors of the Company).
(r) Equity
Capitalization.
(i) Definitions:
(A) “Common
Stock” means (x) the Company’s shares of common stock, $0.0001 par value per share, and (y) any capital stock into
which such common stock shall have been changed or any share capital resulting from a reclassification of such common stock.
(B) “Preferred
Stock” means (x) the Company’s blank check preferred stock, $0.0001 par value per share, the terms of which may be designated
by the board of directors of the Company in a certificate of designations and (y) any capital stock into which such preferred stock shall
have been changed or any share capital resulting from a reclassification of such preferred stock (other than a conversion of such preferred
stock into Common Stock in accordance with the terms of such certificate of designations).
(C) “Series
A Preferred Stock” means (x) the Company’s shares of Series A Preferred Stock as designated by that certain Certificate
of Designation filed with the Secretary of State of the State of Delaware on March 24, 2020 and (y) any capital stock into which such
Series A Preferred Stock shall have been changed or any share capital resulting from a reclassification of such Series A Preferred Stock.
(D) “Series
B-1 Preferred Stock” means (x) the Company’s shares of Series B-1 Convertible Preferred Stock as designated by that certain
Certificate of Designation of Preferences, Rights and Limitations filed with the Secretary of State of the State of Delaware on October
11, 2021 and (y) any capital stock into which such Series B-1 Preferred Stock shall have been changed or any share capital resulting from
a reclassification of such Series B-1 Preferred Stock.
(E) “Series
B-2 Preferred Stock” means (x) the Company’s shares of Series B-2 Convertible Preferred Stock as designated by that certain
Certificate of Designation of Preferences, Rights and Limitations filed with the Secretary of State of the State of Delaware on October
11, 2021 and (y) any capital stock into which such Series B-2 Preferred Stock shall have been changed or any share capital resulting from
a reclassification of such Series B-2 Preferred Stock.
(F) “Series
C Preferred Stock” means (x) the Company’s shares of Series C Convertible Preferred Stock as designated by that certain
Certificate of Designation of Preferences, Rights and Limitations filed with the Secretary of State of the State of Delaware on March
24, 2022 and (y) any capital stock into which such Series C Preferred Stock shall have been changed or any share capital resulting from
a reclassification of such Series C Preferred Stock. (G) “Series D Preferred Stock” means (x) the Company’s shares
of Series D Non-Convertible Preferred Stock as designated by that certain Certificate of Designations filed with the Secretary of State
of the State of Delaware on December 16, 2022 and (y) any capital stock into which such Series D Preferred Stock shall have been changed
or any share capital resulting from a reclassification of such Series D Preferred Stock.
(G) “Series
E-1 Preferred Stock” means (x) the Company’s shares of Series E-1 Convertible Preferred Stock as designated by that certain
Certificate of Designations filed with the Secretary of State of the State of Delaware August 7, 2023 and (y) any capital stock into which
such Series E-1 Preferred Stock shall have been changed or any share capital resulting from a reclassification of such Series E-1 Preferred
Stock.
(H) “Series
F-1 Preferred Stock” means (x) the Company’s shares of Series F-1 Convertible Preferred Stock as designated by that certain
Certificate of Designations filed with the Secretary of State of the State of Delaware December 11, 2023, and Amended and Restated Certificate
of Designations filed with the Secretary of the State of Delaware May [_], 2024 and (y) any capital stock into which such Series F-1 Preferred
Stock shall have been changed or any share capital resulting from a reclassification of such Series F-1 Preferred Stock.
(ii) Authorized
and Outstanding Capital Stock. As of March 31, 2024, the authorized capital stock of the Company consists of (A) 3,000,000,000 shares
of Common Stock, of which, 48,710,395 are issued and outstanding and 915,547,554 shares are reserved for issuance pursuant to Convertible
Securities (as defined below) (other than the Preferred Shares) exercisable or exchangeable for, or convertible into, shares of Common
Stock and (B) 5,000,000 shares of Preferred Stock of which 1,000 shares have been designated as Series A Preferred Stock, none of which
are issued and outstanding; 5,000 shares have been designated as Series B-1 Preferred Stock, none of which are issued and outstanding;
5,000 shares have been designated as Series B-2 Preferred Stock, none of which are issued and outstanding; 1,700 shares have been designated
as Series C Preferred Stock, none of which are issued and outstanding, 70 shares have been designated as Series D Preferred Stock, none
of which are issued and outstanding; 2,300 have been designated as Series E-1 Preferred Stock, 1,920 of which are issued and outstanding;
95,000 shares have been designated as Series F-1 Preferred Stock, 22,280 of which are issued and outstanding. There are no shares of Common
Stock are held in the treasury of the Company. “Convertible Securities” means any capital stock or other security of
the Company or any of its Subsidiaries that is at any time and under any circumstances directly or indirectly convertible into, exercisable
or exchangeable for, or which otherwise entitles the holder thereof to acquire, any capital stock or other security of the Company (including,
without limitation, Common Stock) or any of its Subsidiaries.
(iii) Valid
Issuance; Available Shares; Affiliates. All of such outstanding shares are duly authorized and have been, or upon issuance will be,
validly issued and are fully paid and nonassessable. Schedule 3(r)(iii) sets forth the number of shares of Common Stock that are
(A) reserved for issuance pursuant to Convertible Securities (as defined below) (other than the Preferred Shares) and (B) that are, as
of the date hereof, owned by Persons who are “affiliates” (as defined in Rule 405 of the 1933 Act and calculated based on
the assumption that only officers, directors and holders of at least 10% of the Company’s issued and outstanding Common Stock are
“affiliates” without conceding that any such Persons are “affiliates” for purposes of federal securities laws)
of the Company or any of its Subsidiaries. To the Company’s knowledge, no Person owns 10% or more of the Company’s issued
and outstanding shares of Common Stock (calculated based on the assumption that all Convertible Securities, whether or not presently exercisable
or convertible, have been converted, taking account of any limitations on conversion (including “blockers”) contained
therein without conceding that such identified Person is a 10% stockholder for purposes of federal securities laws).
(iv) Existing
Securities; Obligations. Except as disclosed in the SEC Documents: (A) none of the Company’s or any Subsidiary’s shares,
interests or capital stock is subject to preemptive rights or any other similar rights or Liens suffered or permitted by the Company or
any Subsidiary; (B) there are no outstanding options, warrants, scrip, rights to subscribe to, calls or commitments of any character whatsoever
relating to, or securities or rights convertible into, or exercisable or exchangeable for, any shares, interests or capital stock of the
Company or any of its Subsidiaries, or contracts, commitments, understandings or arrangements by which the Company or any of its Subsidiaries
is or may become bound to issue additional shares, interests or capital stock of the Company or any of its Subsidiaries or options, warrants,
scrip, rights to subscribe to, calls or commitments of any character whatsoever relating to, or securities or rights convertible into,
or exercisable or exchangeable for, any shares, interests or capital stock of the Company or any of its Subsidiaries; (C) there are no
agreements or arrangements under which the Company or any of its Subsidiaries is obligated to register the sale of any of their securities
under the 1933 Act (except pursuant to the Registration Rights Agreement); (D) there are no outstanding securities or instruments of the
Company or any of its Subsidiaries which contain any redemption or similar provisions, and there are no contracts, commitments, understandings
or arrangements by which the Company or any of its Subsidiaries is or may become bound to redeem a security of the Company or any of its
Subsidiaries; (E) there are no securities or instruments containing anti-dilution or similar provisions that will be triggered by the
issuance of the Securities; and (F) neither the Company nor any Subsidiary has any stock appreciation rights or “phantom stock”
plans or agreements or any similar plan or agreement.
(v) Organizational
Documents. The Company has furnished to the Buyer true, correct and complete copies of the Company’s Certificate of Incorporation,
as amended and as in effect on the date hereof (the “Certificate of Incorporation”), and the Company’s bylaws,
as amended and as in effect on the date hereof (the “Bylaws”), and the terms of all Convertible Securities and the
material rights of the holders thereof in respect thereto.
(s) Indebtedness and Other
Contracts. Neither the Company nor any of its Subsidiaries, (i) except as disclosed on Schedule 3(r) or in the SEC Documents,
has any outstanding debt securities, notes, credit agreements, credit facilities or other agreements, documents or instruments evidencing
Indebtedness of the Company or any of its Subsidiaries or by which the Company or any of its Subsidiaries is bound, (ii) is a party to
any contract, agreement or instrument, any reasonably expected violation of which, or reasonably expected default under which, by the
other party(ies) to such contract, agreement or instrument would reasonably be expected to result in a Material Adverse Effect, (iii)
has any financing statements securing obligations in any amounts filed in connection with the Company or any of its Subsidiaries; (iv)
is in violation of any term of, or in default under, any contract, agreement or instrument relating to any Indebtedness, except where
such violations and defaults would not be reasonably likely to result, individually or in the aggregate, in a Material Adverse Effect,
or (v) is a party to any contract, agreement or instrument relating to any Indebtedness, the performance of which, in the judgment of
the Company’s officers, has or is reasonably likely to have a Material Adverse Effect. Neither the Company nor any of its Subsidiaries
have any liabilities or obligations required to be disclosed in the SEC Documents which are not so disclosed in the SEC Documents, other
than those incurred in the ordinary course of the Company’s or its Subsidiaries’ respective businesses and which, individually
or in the aggregate, would not be reasonably likely to have a Material Adverse Effect. For purposes of this Agreement: (x) “Indebtedness”
of any Person means, without duplication (A) all indebtedness for borrowed money, (B) all obligations issued, undertaken or assumed as
the deferred purchase price of property or services (including, without limitation, “capital leases” in accordance with GAAP)
(other than trade payables entered into in the ordinary course of business consistent with past practice), (C) all reimbursement or payment
obligations with respect to letters of credit, surety bonds and other similar instruments, (D) all obligations evidenced by notes, bonds,
debentures or similar instruments, including obligations so evidenced incurred in connection with the acquisition of property, assets
or businesses, (E) all indebtedness created or arising under any conditional sale or other title retention agreement, or incurred as
financing, in either case with respect to any property or assets acquired with the proceeds of such indebtedness (even though the rights
and remedies of the seller or bank under such agreement in the event of default are limited to repossession or sale of such property),
(F) all monetary obligations under any leasing or similar arrangement which, in connection with GAAP, consistently applied for the periods
covered thereby, is classified as a capital lease, (G) all indebtedness referred to in clauses (A) through (F) above secured by (or for
which the holder of such Indebtedness has an existing right, contingent or otherwise, to be secured by) any Lien upon or in any property
or assets (including accounts and contract rights) owned by any Person, even though the Person which owns such assets or property has
not assumed or become liable for the payment of such indebtedness, and (H) all Contingent Obligations in respect of indebtedness or obligations
of others of the kinds referred to in clauses (A) through (G) above; and (y) “Contingent Obligation” means, as to
any Person, any direct or indirect liability, contingent or otherwise, of that Person with respect to any Indebtedness, lease, dividend
or other obligation of another Person if the primary purpose or intent of the Person incurring such liability, or the primary effect
thereof, is to provide assurance to the obligee of such liability that such liability will be paid or discharged, or that any agreements
relating thereto will be complied with, or that the holders of such liability will be protected (in whole or in part) against loss with
respect thereto.
(t) Litigation. There
is no action, suit, arbitration, proceeding, inquiry or investigation before or by the Principal Market, any court, public board, other
Governmental Entity, self-regulatory organization or body pending or, to the knowledge of the Company, threatened against or affecting
the Company or any of its Subsidiaries, the Common Stock or any of the Company’s or its Subsidiaries’ officers or directors,
whether of a civil or criminal nature or otherwise, in their capacities as such that if adversely determined would have a Material Adverse
Effect, except as set forth in Schedule 3(t) or in the SEC Documents. To the knowledge of the Company, no director, officer or
employee of the Company or any of its subsidiaries has willfully violated 18 U.S.C. §1519 or engaged in spoliation in reasonable
anticipation of litigation. Without limitation of the foregoing, there has not been, and to the knowledge of the Company, there is not
pending or contemplated, any investigation by the SEC involving the Company, any of its Subsidiaries or any current or former director
or officer of the Company or any of its Subsidiaries. The SEC has not issued any stop order or other order suspending the effectiveness
of any registration statement filed by the Company under the 1933 Act or the 1934 Act. The Company is not aware of any fact which might
result in or form the basis for any such action, suit, arbitration, investigation, inquiry or other proceeding. Neither the Company nor
any of its Subsidiaries is subject to any order, writ, judgment, injunction, decree, determination or award of any Governmental Entity.
(u) Insurance. The
Company and each of its Subsidiaries are insured against such losses and risks and in such amounts as management of the Company believes
to be prudent and customary in the businesses in which the Company and its Subsidiaries are engaged. Neither the Company nor any such
Subsidiary has been refused any insurance coverage sought or applied for, and neither the Company nor any such Subsidiary has any reason
to believe that it will be unable 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 at a cost that would not have a Material Adverse Effect.
(v) Employee Relations.
Neither the Company nor any of its Subsidiaries is a party to any collective bargaining agreement or employs any member of a union. Except
as discussed in the Schedules hereto, the Company and its Subsidiaries believe that their relations with their employees are good. Except
as set forth in the SEC Documents, no executive officer (as defined in Rule 501(f) promulgated under the 1933 Act) of the Company or
any of its Subsidiaries has notified the Company or any such Subsidiary that such officer intends to leave the Company or any such Subsidiary
or otherwise terminate such officer’s employment with the Company or any such Subsidiary. No executive officer of the Company or
any of its Subsidiaries is, or is expected to be at this time, in violation of any material term of any employment contract, confidentiality,
disclosure or proprietary information agreement, non-competition agreement, or any other contract or agreement or any restrictive covenant,
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 federal, state, local and foreign
laws and regulations respecting labor, employment and employment practices and benefits, terms and conditions of employment and wages
and hours, except where failure to be in compliance would not, either individually or in the aggregate, reasonably be expected to result
in a Material Adverse Effect.
(w) Title.
(i) Real
Property. Each of the Company and its Subsidiaries holds good title to all real property, leases in real property, facilities or other
interests in real property owned or held by the Company or any of its Subsidiaries (the “Real Property”) owned by the
Company or any of its Subsidiaries (as applicable). The Real Property is free and clear of all Liens and is not subject to any rights
of way, building use restrictions, exceptions, variances, reservations, or limitations of any nature except for (a) Liens for current
taxes not yet due and (b) zoning laws and other land use restrictions that do not impair the present or anticipated use of the property
subject thereto. Any Real Property held under lease by the Company or any of its Subsidiaries are held by them under valid, subsisting
and enforceable leases with such exceptions as are not material and do not interfere with the use made and proposed to be made of such
property and buildings by the Company or any of its Subsidiaries.
(ii) Fixtures
and Equipment. Each of the Company and its Subsidiaries (as applicable) has good title to, or a valid leasehold interest in, the tangible
personal property, equipment, improvements, fixtures, and other personal property and appurtenances that are used by the Company or its
Subsidiary in connection with the conduct of its business (the “Fixtures and Equipment”). The Fixtures and Equipment
are structurally sound, are in good operating condition and repair, are adequate for the uses to which they are being put, are not in
need of maintenance or repairs except for ordinary, routine maintenance and repairs and are sufficient for the conduct of the Company’s
and/or its Subsidiaries’ businesses (as applicable) in the manner as conducted prior to the Closing. Each of the Company and its
Subsidiaries owns all of its Fixtures and Equipment free and clear of all Liens except for (a) liens for current taxes not yet due and
(b) zoning laws and other land use restrictions that do not impair the present or anticipated use of the property subject thereto.
(x) Intellectual Property
Rights. The Company and its Subsidiaries own or possess adequate rights or licenses to use all trademarks, trade names, service marks,
service mark registrations, service names, original works of authorship, patents, patent rights, copyrights, inventions, licenses, approvals,
governmental authorizations, trade secrets and other intellectual property rights and all applications and registrations therefor (“Intellectual
Property Rights”) necessary to conduct their respective businesses as now conducted and presently proposed to be conducted.
Each of the patents both (x) owned by the Company or any of its Subsidiaries and (y) currently used (or proposed to be used) in the business
of the Company or any of its Subsidiaries is listed on Schedule 3(x)(i) (the “Material Intellectual Property Rights”).
Except as set forth in Schedule 3(x)(ii) or in the SEC Documents, none of the Company’s Material Intellectual Property Rights have
expired or terminated or have been abandoned or are expected to expire or terminate or are expected to be abandoned, within three years
from the date of this Agreement other than any such expirations or terminations that, individually or in the aggregate, are not reasonably
likely to have a Material Adverse Effect. The Company does not have any knowledge of any infringement by the Company or its Subsidiaries
of Material Intellectual Property Rights of others which infringement is reasonably likely to have a Material Adverse Effect. There is
no claim, action or proceeding being made or brought, or to the knowledge of the Company or any of its Subsidiaries, being threatened,
against the Company or any of its Subsidiaries regarding its Intellectual Property Rights, which claim, action or proceeding would reasonably
be expected to result in a Material Adverse Effect. Neither the Company nor any of its Subsidiaries is aware of any facts or circumstances
which might give rise to any of the foregoing infringements or claims, actions or proceedings. The Company and its Subsidiaries have
taken reasonable security measures to protect the secrecy, confidentiality and value of all of the Material Intellectual Property Rights.
(y) Environmental Laws.
(i) The Company and its Subsidiaries (A) are in compliance with any and all Environmental Laws (as defined below), (B) have received
all permits, licenses or other approvals required of them under applicable Environmental Laws to conduct their respective businesses
and (C) are in compliance with all terms and conditions of any such permit, license or approval where, in each of the foregoing clauses
(A), (B) and (C), the failure to so comply or so receive such approvals would be reasonably expected to have, individually or in the
aggregate, a Material Adverse Effect. The term “Environmental Laws” means all federal, state, local or foreign laws
relating to pollution or protection of human health or the environment (including, without limitation, ambient air, surface water, groundwater,
land surface or subsurface strata), including, without limitation, 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.
(ii) No
Hazardous Materials:
(A) have
been disposed of or otherwise released from any Real Property of the Company or any of its Subsidiaries in violation of any Environmental
Laws; or
(B) are
present on, over, beneath, in or upon any Real Property or any portion thereof in quantities that would constitute a violation of any
Environmental Laws. No prior use by the Company or any of its Subsidiaries of any Real Property has occurred that violates any Environmental
Laws, which violation would be reasonably expected to have a Material Adverse Effect.
(iii) Neither the
Company nor any of its Subsidiaries knows of any other person who or entity which has stored, treated, recycled, disposed of or otherwise
located on any Real Property any Hazardous Materials, including, without limitation, such substances as asbestos and polychlorinated
biphenyls.
(iv) None
of the Real Properties are on any federal or state “Superfund” list or Liability Information System (“CERCLIS”)
list or any state environmental agency list of sites under consideration for CERCLIS, nor subject to any environmental related Liens.
(z) Subsidiary Rights.
The Company or one of its Subsidiaries has the unrestricted right to vote, and (subject to limitations imposed by applicable law) to
receive dividends and distributions on, all capital securities of its Subsidiaries as owned by the Company or such Subsidiary.
(aa) Tax Status. The
Company and each of its Subsidiaries (i) has timely made or filed all foreign, federal and state income and all other tax returns, reports
and declarations required by any jurisdiction to which it is subject, (ii) has timely 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, except those being
contested in good faith and (iii) has set aside on its books provision reasonably adequate for the payment of all taxes for periods subsequent
to the periods to which such returns, reports or declarations apply in each case except as would not reasonably be expected to have a
Material Adverse Effect. 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 and its Subsidiaries know of no basis for any such claim. The Company is not operated in such a manner
as to qualify as a passive foreign investment company, as defined in Section 1297 of the Internal Revenue Code of 1986, as amended (the
“Code”). [Note to Company – need to revise][ So long as such Investor together with the other Attribution Parties
(as defined in the Notes) collectively do not own in excess of the Maximum Percentage (as defined in the Notes) of the shares of Common
Stock outstanding, the net operating loss carryforwards (“NOLs”) for United States federal income tax purposes of
the consolidated group of which the Company is the common parent, if any, shall not be adversely effected by the transactions contemplated
hereby, and the transactions contemplated hereby do not constitute an “ownership change” within the meaning of Section 382
of the Code, thereby preserving the Company’s ability to utilize such NOLs.]
(bb) Internal Accounting
and Disclosure Controls. As disclosed in the SEC Documents, the Company and each of its Subsidiaries have not maintained internal
control over financial reporting (as such term is defined in Rule 13a-15(f) under the 1934 Act) that is effective in providing reasonable
assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance
with generally accepted accounting principles, including 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 and liability accountability, (iii) access to assets or incurrence of liabilities is permitted only in accordance
with management’s general or specific authorization and (iv) the recorded accountability for assets and liabilities is compared
with the existing assets and liabilities at reasonable intervals and appropriate action is taken with respect to any difference. The
Company has failed to maintain disclosure controls and procedures (as such term is defined in Rule 13a-15(e) under the 1934 Act) that
are effective in ensuring that information required to be disclosed by the Company in the reports that it files or submits under the
1934 Act is recorded, processed, summarized and reported, within the time periods specified in the rules and forms of the SEC, including,
without limitation, controls and procedures designed to ensure that information required to be disclosed by the Company in the reports
that it files or submits under the 1934 Act is accumulated and communicated to the Company’s management, including its principal
executive officer or officers and its principal financial officer or officers, as appropriate, to allow timely decisions regarding required
disclosure. Neither the Company nor any of its Subsidiaries has received any notice or correspondence from any accountant, Governmental
Entity or other Person relating to any potential material weakness or significant deficiency (which significant deficiency has not been
subsequently resolved) in any part of the internal controls over financial reporting of the Company or any of its Subsidiaries.
(cc) Off Balance Sheet
Arrangements. There is no transaction, arrangement, or other relationship between the Company or any of its Subsidiaries and an unconsolidated
or other off balance sheet entity that is required to be disclosed by the Company in its 1934 Act filings and is not so disclosed or
that otherwise would be reasonably likely to have a Material Adverse Effect.
(dd) Investment Company
Status. The Company is not, and upon consummation of the sale of the Securities will not be, an “investment company,”
an affiliate of an “investment company,” a company controlled by an “investment company” or an “affiliated
person” of, or “promoter” or “principal underwriter” for, an “investment company” as such terms
are defined in the Investment Company Act of 1940, as amended.
(ee) Acknowledgement Regarding
Buyer’s Trading Activity. It is understood and acknowledged by the Company that (i) following the public disclosure of the
transactions contemplated by the Transaction Documents, in accordance with the terms thereof, the Buyer has not been asked by the Company
or any of its Subsidiaries to agree, nor has any Buyer agreed with the Company or any of its Subsidiaries, to desist from effecting any
transactions in or with respect to (including, without limitation, purchasing or selling, long and/or short) any securities of the Company,
or “derivative” securities based on securities issued by the Company or to hold any of the Securities for any specified term;
(ii) the Buyer, and counterparties in “derivative” transactions to which the Buyer is a party, directly or indirectly, presently
may have a “short” position in the Common Stock which was established prior to the Buyer’s knowledge of the transactions
contemplated by the Transaction Documents; (iii) each Buyer shall not be deemed to have any affiliation with or control over any arm’s
length counterparty in any “derivative” transaction; and (iv) the Buyer may rely on the Company’s obligation to timely
deliver shares of Common Stock upon conversion or exchange, as applicable, of the Securities as and when required pursuant to the Transaction
Documents for purposes of effecting trading in the Common Stock of the Company. The Company further understands and acknowledges that
following the public disclosure of the transactions contemplated by the Transaction Documents pursuant to the 8-K Filing (as defined
below) the Buyer may engage in hedging and/or trading activities (including, without limitation, the location and/or reservation of borrowable
shares of Common Stock) at various times during the period that the Securities are outstanding, including, without limitation, during
the periods that the value and/or number of the Conversion Shares, deliverable with respect to the Securities are being determined and
such hedging and/or trading activities (including, without limitation, the location and/or reservation of borrowable shares of Common
Stock), if any, can reduce the value of the existing stockholders’ equity interest in the Company both at and after the time the
hedging and/or trading activities are being conducted. The Company acknowledges that such aforementioned hedging and/or trading activities
do not constitute a breach of this Agreement, the Certificate of Designations, or any other Transaction Document or any of the documents
executed in connection herewith or therewith.
(ff) Manipulation of Price.
Other than disclosed in the SEC Document or in Schedule 3(ff) hereto, neither the Company nor any of its Subsidiaries has, and, to the
knowledge of the Company, no Person acting on their behalf has, directly or indirectly, (i) taken any action designed to cause or to
result in the stabilization or manipulation of the price of any security of the Company or any of its Subsidiaries 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, (iii) paid or agreed to pay to any Person any compensation for soliciting another to purchase any other securities of
the Company or any of its Subsidiaries or (iv) paid or agreed to pay any Person for research services with respect to any securities
of the Company or any of its Subsidiaries.
(gg) U.S. Real Property
Holding Corporation. Neither the Company nor any of its Subsidiaries is, or has ever been, and so long as any of the Securities are
held by the Buyer, shall become, a U.S. real property holding corporation within the meaning of Section 897 of the Code, and the
Company and each Subsidiary shall so certify upon the Buyer’s request.
(hh) Omitted.
(ii) Transfer Taxes.
On the Closing Date, all stock transfer or other taxes (other than income or similar taxes) which are required to be paid in connection
with the issuance, sale and transfer of the Securities to be sold to the Buyer hereunder will be, or will have been, fully paid or provided
for by the Company, and all laws imposing such taxes will be or will have been complied with.
(jj) Bank Holding Company
Act. Neither the Company nor any of its Subsidiaries 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 (25%) 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.
(kk) Shell Company Status.
The Company is not, and has never been, an issuer identified in, or subject to, Rule 144(i).
(ll) Illegal or Unauthorized
Payments; Political Contributions. Neither the Company nor any of its Subsidiaries nor, to the best of the Company’s knowledge
(after reasonable inquiry of its officers and directors), any of the officers, directors, employees, agents or other representatives
of the Company or any of its Subsidiaries or any other business entity or enterprise with which the Company or any Subsidiary is or has
been affiliated or associated, has, directly or indirectly, made or authorized any payment, contribution or gift of money, property,
or services, whether or not in contravention of applicable law, (i) as a kickback or bribe to any Person or (ii) to any political organization,
or the holder of or any aspirant to any elective or appointive public office except for personal political contributions not involving
the direct or indirect use of funds of the Company or any of its Subsidiaries.
(mm) Money Laundering.
The Company and its Subsidiaries are in compliance with, and have not previously violated, the USA Patriot Act of 2001 and all other
applicable U.S. and non-U.S. anti-money laundering laws and regulations, including, without limitation, the laws, regulations and Executive
Orders and sanctions programs administered by the U.S. Office of Foreign Assets Control, including, but not limited, to (i) Executive
Order 13224 of September 23, 2001 entitled, “Blocking Property and Prohibiting Transactions With Persons Who Commit, Threaten to
Commit, or Support Terrorism” (66 Fed. Reg. 49079 (2001)); and (ii) any regulations contained in 31 CFR, Subtitle B, Chapter V.
(nn) Management. Except
as set forth in Schedule 3(nn) hereto, during the past two year period, no current or, to the knowledge of the Company, former
officer or director or, to the knowledge of the Company, no current ten percent (10%) or greater stockholder of the Company or any of
its Subsidiaries has been the subject of:
(i) a
petition under bankruptcy laws or any other insolvency or moratorium law or the appointment by a court of a receiver, fiscal agent or
similar officer for such Person, or any partnership in which such person was a general partner at or within two years before the filing
of such petition or such appointment, or any corporation or business association of which such person was an executive officer at or within
two years before the time of the filing of such petition or such appointment;
(ii) a
conviction in a criminal proceeding or a named subject of a pending criminal proceeding (excluding traffic violations that do not relate
to driving while intoxicated or driving under the influence);
(iii) any
order, judgment or decree, not subsequently reversed, suspended or vacated, of any court of competent jurisdiction, permanently or temporarily
enjoining any such person from, or otherwise limiting, the following activities:
(1) Acting
as a futures commission merchant, introducing broker, commodity trading advisor, commodity pool operator, floor broker, leverage transaction
merchant, any other person regulated by the United States Commodity Futures Trading Commission or an associated person of any of the foregoing,
or as an investment adviser, underwriter, broker or dealer in securities, or as an affiliated person, director or employee of any investment
company, bank, savings and loan association or insurance company, or engaging in or continuing any conduct or practice in connection with
such activity;
(2) Engaging
in any particular type of business practice; or
(3) Engaging
in any activity in connection with the purchase or sale of any security or commodity or in connection with any violation of securities
laws or commodities laws;
(iv) any
order, judgment or decree, not subsequently reversed, suspended or vacated, of any authority barring, suspending or otherwise limiting
for more than sixty (60) days the right of any such person to engage in any activity described in the preceding sub paragraph, or to be
associated with persons engaged in any such activity;
(v) a
finding by a court of competent jurisdiction in a civil action or by the SEC or other authority to have violated any securities law, regulation
or decree and the judgment in such civil action or finding by the SEC or any other authority has not been subsequently reversed, suspended
or vacated; or
(vi) a
finding by a court of competent jurisdiction in a civil action or by the Commodity Futures Trading Commission to have violated any federal
commodities law, and the judgment in such civil action or finding has not been subsequently reversed, suspended or vacated.
(oo) Stock Option Plans.
Except as set forth in the SEC Documents, each stock option granted by the Company was granted (i) in accordance with the terms of the
applicable stock option plan of the Company 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 policy or practice of the
Company 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.
(pp) No Disagreements
with Accountants and Lawyers. Excepts as disclosed in the SEC Documents and/or Schedule 3(pp) there are no material 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 would be reasonably likely to affect the Company’s ability to perform any of its obligations under any of the Transaction
Documents. In addition, on or prior to the date hereof, the Company had discussions with its accountants about its financial statements
previously filed with the SEC. Based on those discussions, the Company has no reason to believe that it will need to restate any such
financial statements or any part thereof.
(qq) No Disqualification
Events. With respect to Securities to be offered and sold hereunder in reliance on Rule 506(b) under the 1933 Act (“Regulation
D Securities”), none of the Company, any of its predecessors, any affiliated issuer, any director, executive officer, other
officer of the Company participating in the offering contemplated hereby, 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 1933 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 1933 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 Buyer a copy of any disclosures provided thereunder.
(rr) Other Covered Persons.
The Company is not aware of any Person that has been or will be paid (directly or indirectly) remuneration for solicitation of Buyer
or potential purchasers in connection with the sale of any Regulation D Securities.
(ss) No Additional Agreements.
The Company does not have any agreement or understanding with the Buyer with respect to the transactions contemplated by the Transaction
Documents other than as specified in the Transaction Documents.
(tt) Public Utility Holding
Act. None of the Company nor any of its Subsidiaries is a “holding company,” or an “affiliate” of a “holding
company,” as such terms are defined in the Public Utility Holding Act of 2005.
(uu) Federal Power Act.
None of the Company nor any of its Subsidiaries is subject to regulation as a “public utility” under the Federal Power Act,
as amended.
(vv) Omitted.
(ww) Potential Products;
FDA; EMEA.
(i) The
Company possesses all certificates, authorizations and permits issued by the appropriate federal, state or foreign regulatory authorities
necessary to conduct its business as currently conducted, including without limitation all such certificates, authorizations and permits
required by the United States Food and Drug Administration (the “FDA”) or any other federal, state or foreign agencies
or bodies engaged in the regulation of pharmaceuticals or biohazardous materials, except where the failure to so possess such certificates,
authorizations and permits, individually or in the aggregate, would not result in a Material Adverse Effect. The Company has not received
any notice of proceedings relating to the revocation or modification of any such certificate, authorization or permit which, individually
or in the aggregate, if the subject of an unfavorable decision, ruling or finding, would have a Material Adverse Effect.
(ii) The
Company has not received any written notices or statements from the FDA, the European Medicines Agency (the “EMEA”)
or any other governmental agency, and otherwise has no knowledge or reason to believe, that (i) any drug or other product candidate of
the Company (each a “Potential Product”) may or will be rejected or determined to be non-approvable; (ii) a delay in
time for review and/or approval of a marketing authorization application or marketing approval application in any jurisdiction for any
Potential Product is or may be required, requested or being implemented; (iii) one or more clinical studies for any Potential Product
shall or may be requested or required in addition to the clinical studies submitted to the FDA prior to the date hereof as a precondition
to or condition of issuance or maintenance of a marketing approval for any Potential Product; (iv) any license, approval, permit or authorization
to conduct any clinical trial of or market any product or Potential Product of the Company has been, will be or may be suspended, revoked,
modified or limited, except in the cases of clauses (i), (ii), (iii) and (iv) where such rejections, determinations, delays, requests,
suspensions, revocations, modifications or limitations might not reasonably be expected to have, individually or in the aggregate, a Material
Adverse Effect.
(iii) To
the Company’s knowledge, the preclinical and clinical testing, application for marketing approval of, manufacture, distribution,
promotion and sale of the products and Potential Products of the Company is in compliance, in all material respects, with all laws, rules
and regulations applicable to such activities, including without limitation applicable good laboratory practices, good clinical practices
and good manufacturing practices, except for such non-compliance as would not, individually or in the aggregate, have a Material Adverse
Effect. The Company is not aware of any studies, tests or trial the results of which reasonably call into question the results of the
tests and trials conducted by or on behalf of the Company. The Company has not received notice of adverse finding, warning letter or clinical
hold notice from the FDA or any non-U.S. counterpart of any of the foregoing, or any untitled letter or other correspondence or notice
from the FDA or any other governmental authority or agency or any institutional or ethical review board alleging or asserting noncompliance
with any law, rule or regulation applicable in any jurisdiction, except notices, letters, and correspondences and non-U.S. counterparts
thereof alleging or asserting such noncompliance as would not, individually or in the aggregate, have a Material Adverse Effect. The Company
has not, either voluntarily or involuntarily, initiated, conducted or issued, or caused to be initiated, conducted or issued, any recall,
field correction, market withdrawal or replacement, safety alert, warning, “dear doctor” letter, investigator notice, or other
notice or action relating to an alleged or potential lack of safety or efficacy of any product or Potential Product of the Company, any
alleged product defect of any product or Potential Product of the Company, or any violation of any material applicable law, rule, regulation
or any clinical trial or marketing license, approval, permit or authorization for any product or potential product of the Company, and
the Company is not aware of any facts or information that would cause it to initiate any such notice or action and has no knowledge or
reason to believe that the FDA, the EMEA or any other governmental agency or authority or any institutional or ethical review board or
other non-governmental authority intends to impose, require, request or suggest such notice or action.
(xx) Cybersecurity.
The Company and its Subsidiaries’ information technology assets and equipment, computers, systems, networks, hardware, software,
websites, applications, and databases (collectively, “IT Systems”) are adequate for, and operate and perform in all
material respects as required in connection with the operation of the business of the Company and its subsidiaries as currently conducted,
free and clear of all material bugs, errors, defects, Trojan horses, time bombs, malware and other corruptants that would reasonably be
expected to have a Material Adverse Effect on the Company’s business. The Company and its Subsidiaries have implemented and maintained
commercially reasonable physical, technical and administrative controls, policies, procedures, and safeguards to maintain and protect
their material confidential information and the integrity, continuous operation, redundancy and security of all IT Systems and data, including
“Personal Data,” used in connection with their businesses. “Personal Data” means (i) a natural person’s
name, street address, telephone number, e-mail address, photograph, social security number or tax identification number, driver’s
license number, passport number, credit card number, bank information, or customer or account number; (ii) any information which would
qualify as “personally identifying information” under the Federal Trade Commission Act, as amended; (iii) “personal
data” as defined by the European Union General Data Protection Regulation (“GDPR”) (EU 2016/679); (iv) any information
which would qualify as “protected health information” under the Health Insurance Portability and Accountability Act of 1996,
as amended by the Health Information Technology for Economic and Clinical Health Act (collectively, “HIPAA”); and (v)
any other piece of information that allows the identification of such natural person, or his or her family, or permits the collection
or analysis of any data related to an identified person’s health or sexual orientation. There have been no breaches, violations,
outages or unauthorized uses of or accesses to same, except for those that have been remedied without material cost or liability or the
duty to notify any other person or such, nor any incidents under internal review or investigations relating to the same except in each
case, where such would not, either individually or in the aggregate, reasonably be expected to result in a Material Adverse Effect. The
Company and its 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 Personal Data and to the protection of such IT Systems and Personal Data from unauthorized use, access,
misappropriation or modification except in each case, where such would not, either individually or in the aggregate, reasonably be expected
to result in a Material Adverse Effect.
(yy) Compliance with
Data Privacy Laws. The Company and its Subsidiaries are, and at all prior times were, in compliance with all applicable state and
federal data privacy and security laws and regulations, including without limitation HIPAA, and the Company and its Subsidiaries have
taken commercially reasonable actions to prepare to comply with, and since May 25, 2018, have been and currently are in compliance with,
the GDPR (EU 2016/679) (collectively, the “Privacy Laws”) except in each case, where such would not, either individually
or in the aggregate, reasonably be expected to result in a Material Adverse Effect. To ensure compliance with the Privacy Laws, the Company
and its Subsidiaries have in place, comply with, and take appropriate steps reasonably designed to ensure compliance in all material respects
with their policies and procedures relating to data privacy and security and the collection, storage, use, disclosure, handling, and analysis
of Personal Data (the “Policies”). The Company and its Subsidiaries have at all times made all disclosures to users
or customers required by applicable laws and regulatory rules or requirements, and none of such disclosures made or contained in any Policy
have, to the knowledge of the Company, been inaccurate or in violation of any applicable laws and regulatory rules or requirements in
any material respect. The Company further certifies that neither it nor any Subsidiary: (i) has received notice of any actual or potential
liability under or relating to, or actual or potential violation of, any of the Privacy Laws, and has no knowledge of any event or condition
that would reasonably be expected to result in any such notice; (ii) is currently conducting or paying for, in whole or in part, any investigation,
remediation, or other corrective action pursuant to any Privacy Law; or (iii) is a party to any order, decree, or agreement that imposes
any obligation or liability under any Privacy Law.
(zz) Registration Rights.
Except as disclosed in the SEC Documents and/or the Schedules hereto, no holder of securities of the Company has rights to the registration
of any securities of the Company because of the filing of the Registration Statement or the issuance of the Securities hereunder that
could expose the Company to material liability or the Buyer to any liability or that could impair the Company’s ability to consummate
the issuance and sale of the Securities in the manner, and at the times, contemplated hereby, which rights have not been waived by the
holder thereof as of the date hereof.
(aaa) Disclosure.
The Company confirms that neither it nor any other Person acting on its behalf has provided the Buyer or their agents or counsel with
any information that constitutes or could reasonably be expected to constitute material, non-public information concerning the Company
or any of its Subsidiaries, other than the existence of the transactions contemplated by this Agreement and the other Transaction Documents.
The Company understands and confirms that the Buyer will rely on the foregoing representations in effecting transactions in securities
of the Company. All disclosure provided to the Buyer regarding the Company and its Subsidiaries, their businesses and the transactions
contemplated hereby, including the schedules to this Agreement, furnished by or on behalf of the Company or any of its Subsidiaries is
true and correct as of the date furnished and does not contain any untrue statement of a material fact or omit to state any material
fact as of the date furnished necessary in order to make the statements made therein, in the light of the circumstances under which they
were made, not misleading. All of the written information furnished after the date hereof by or on behalf of the Company or any of its
Subsidiaries to the Buyer pursuant to or in connection with this Agreement and the other Transaction Documents, taken as a whole, will
be true and correct in all material respects as of the date on which such information is so provided and will 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. Each press release issued by the Company or any of its Subsidiaries
during the twelve (12) months preceding the date of this Agreement did not at the time of release 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 are made, not misleading. No event or circumstance has occurred or information exists with respect
to the Company or any of its Subsidiaries or its or their business, properties, liabilities, prospects, operations (including results
thereof) or conditions (financial or otherwise), which, under applicable law, rule or regulation, requires public disclosure at or before
the date hereof or announcement by the Company but which has not been so publicly disclosed. The Company acknowledges and agrees that
no Buyer makes or has made any representations or warranties with respect to the transactions contemplated hereby other than those specifically
set forth in Section 2.
4. COVENANTS.
(a) Best Efforts.
The Buyer shall use its best efforts to timely satisfy each of the covenants hereunder and conditions to be satisfied by it as provided
in Section 6 of this Agreement. The Company shall use its best efforts to timely satisfy each of the covenants hereunder and conditions
to be satisfied by it as provided in Section 7 of this Agreement.
(b) Blue Sky. The
Company shall, on or before the Closing Date, 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 Buyers at the Closing pursuant to this Agreement under applicable securities
or “Blue Sky” laws of the states of the United States (or to obtain an exemption from such qualification), and shall provide
evidence of any such action so taken to the Buyers on or prior to the Closing Date. Without limiting any other obligation of the Company
under this Agreement, the Company shall timely make all filings and reports relating to the offer and sale of the Securities required
under all applicable securities laws (including, without limitation, all applicable federal securities laws and all applicable “Blue
Sky” laws), and the Company shall comply with all applicable foreign, federal, state and local laws, statutes, rules, regulations
and the like relating to the offering and sale of the Securities to the Buyers.
(c) Reporting Status.
Until the date on which the Buyer shall have sold all of the Securities (the “Reporting Period”), the Company shall
timely file all reports required to be filed with the SEC pursuant to the 1934 Act, and the Company shall not terminate its status as
an issuer required to file reports under the 1934 Act even if the 1934 Act or the rules and regulations thereunder would no longer require
or otherwise permit such termination. From the time Form S-3 is available to the Company for the registration of the Registrable Securities,
the Company shall take all actions necessary to maintain its eligibility to register the Registrable Securities for resale by the Buyers
on Form S-3.
(d) Use of Proceeds.
The Company will use the proceeds from the sale of the Securities for general corporate purposes, but not, directly or indirectly, for
(i) except as set forth on Schedule 4(d), the satisfaction of any indebtedness of the Company or any of its Subsidiaries, (ii) the redemption
or repurchase of any securities of the Company or any of its Subsidiaries, or (iii) the settlement of any outstanding litigation.
(e) Financial Information.
The Company agrees to send the following to the Buyer (as defined in the Registration Rights Agreement) during the Reporting Period (i)
unless the following are filed with the SEC through EDGAR and are available to the public through the EDGAR system, within one (1) Business
Day after the filing thereof with the SEC, a copy of its Annual Reports on Form 10-K and Quarterly Reports on Form 10-Q, any interim
reports or any consolidated balance sheets, income statements, stockholders’ equity statements and/or cash flow statements for
any period other than annual or quarterly, any Current Reports on Form 8-K and any registration statements (other than on Form S-8) or
amendments filed pursuant to the 1933 Act, (ii) unless the following are either filed with the SEC through EDGAR or are otherwise widely
disseminated via a recognized news release service (such as PR Newswire), on the same day as the release thereof, e-mail copies of all
press releases issued by the Company or any of its Subsidiaries and (iii) unless the following are filed with the SEC through EDGAR,
copies of any notices and other information made available or given to the stockholders of the Company generally, contemporaneously with
the making available or giving thereof to the stockholders.
(f) Omitted
(g) Fees. Except as
otherwise set forth in the Transaction Documents, each party to this Agreement shall bear its own expenses in connection with the sale
of the Securities to the Buyer.
(h) Omitted.
(i) Disclosure of Transactions
and Other Material Information.
(i) Disclosure
of Transaction. On or before 9:00 a.m., New York time, on or before the fourth (4th) Business Day after the date of this
Agreement, the Company shall file a Current Report on Form 8-K describing all the material terms of the transactions contemplated by the
Transaction Documents in the form required by the 1934 Act and attaching all the material Transaction Documents (including, without limitation,
this Agreement (and all schedules to this Agreement), and the form of Certificate of Designations and the form of the Registration Rights
Agreement) (including all attachments, the “8-K Filing”). From and after the filing of the 8-K Filing, the Company
shall have disclosed all material, non-public information (if any) provided to the Buyers by the Company or any of its Subsidiaries or
any of their respective officers, directors, employees or agents in connection with the transactions contemplated by the Transaction Documents.
In addition, effective upon the filing of the 8-K Filing, the Company acknowledges and agrees that any and all confidentiality or similar
obligations under any agreement, whether written or oral, between the Company, any of its Subsidiaries or any of their respective officers,
directors, affiliates, employees or agents, on the one hand, and the Buyer or any of its affiliates, on the other hand, with the exception
of the Agreement and Plan of Merger dated December 11, 2023, as amended, Transaction Agreements (defined therein) and related disclosures,
shall terminate.
(j) Reservation of Shares.
So long as any of the Preferred Shares remain outstanding, the Company shall take all action necessary to at all times have authorized,
and reserved for the purpose of issuance, not less than (i) 100% of the maximum number of shares of Common Stock issuable upon conversion
of all the Preferred Shares then outstanding (assuming for purposes hereof that (x) the Preferred Shares are convertible at the Alternate
Conversion Price assuming an Alternate Conversion Date as of such applicable date of determination, and (y) any such conversion shall
not take into account any limitations on the conversion of the Preferred Shares set forth in the Certificate of Designations), (collectively,
the “Required Reserve Amount”); provided that at no time shall the number of shares of Common Stock reserved pursuant
to this Section 4(l) be reduced other than proportionally in connection with any conversion, or redemption, as applicable of Preferred
Shares. If at any time the number of shares of Common Stock authorized and reserved for issuance is not sufficient to meet the Required
Reserve Amount, the Company will promptly take all corporate action necessary to authorize and reserve a sufficient number of shares,
including, without limitation, calling a special meeting of stockholders to authorize additional shares to meet the Company’s obligations
pursuant to the Transaction Documents, in the case of an insufficient number of authorized shares, obtain stockholder approval of an
increase in such authorized number of shares, and voting the management shares of the Company in favor of an increase in the authorized
shares of the Company to ensure that the number of authorized shares is sufficient to meet the Required Reserve Amount.
(k) Conduct of Business.
The business of the Company and its Subsidiaries shall not be conducted in violation of any law, ordinance or regulation of any Governmental
Entity, except where such violations would not reasonably be expected to result, either individually or in the aggregate, in a Material
Adverse Effect.
(l) Other Preferred Shares;
Variable Securities. So long as any Preferred Shares remain outstanding, the Company and each Subsidiary shall be prohibited from
effecting or entering into an agreement to effect any Subsequent Placement involving a Variable Rate Transaction. “Variable
Rate Transaction” means a transaction in which the Company or any Subsidiary (i) issues or sells any Convertible Securities
either (A) at a conversion or exchange rate or other price that is based upon and/or varies with the trading prices of or quotations
for the shares of Common Stock at any time after the initial issuance of such Convertible Securities, or (B) with a conversion or exchange
price that is subject to being reset at some future date after the initial issuance of such Convertible Securities or upon the occurrence
of specified or contingent events directly or indirectly related to the business of the Company or the market for the Common Stock, other
than pursuant to a customary “weighted average” anti-dilution provision or (ii) enters into any agreement (including, without
limitation, an equity line of credit or an “at-the-market” offering) whereby the Company or any Subsidiary may sell securities
at a future determined price (other than standard and customary “preemptive” or “participation” rights). Each
Buyer shall be entitled to obtain injunctive relief against the Company and its Subsidiaries to preclude any such issuance, which remedy
shall be in addition to any right to collect damages.
(m) Dilutive Issuances.
For so long as any Preferred Shares remain outstanding, the Company shall not, in any manner, enter into or affect any Dilutive Issuance
(as defined in the Certificate of Designations) if the effect of such Dilutive Issuance is to cause the Company to be required to issue
upon conversion of any Preferred Shares any shares of Common Stock in excess of that number of shares of Common Stock which the Company
may issue upon conversion of the Preferred Shares without breaching the Company’s obligations under the rules or regulations of
the Principal Market.
(n) Passive Foreign Investment
Company. The Company shall conduct its business, and shall cause its Subsidiaries to conduct their respective businesses, in such
a manner as will ensure that the Company will not be deemed to constitute a passive foreign investment company within the meaning of
Section 1297 of the Code.
(o) Restriction on Redemption
and Cash Dividends. So long as any Preferred Shares are outstanding, the Company shall not, directly or indirectly, redeem, or declare
or pay any cash dividend or distribution on, any securities of the Company without the prior express written consent of the Buyer (other
than as required by the Certificate of Designations).
(p) Corporate Existence.
So long as the Buyer beneficially owns any Preferred Shares, the Company shall not be party to any Fundamental Transaction (as defined
in the Certificate of Designations) unless the Company is in compliance with the applicable provisions governing Fundamental Transactions
set forth in the Certificate of Designations.
(q) Omitted.
(r) Conversion
Procedures. Each of the form of Conversion Notice (as defined in the Certificate of Designations) included in the Certificate of Designations
set forth the totality of the procedures required of the Buyer in order to convert the Preferred Shares. Except as provided in Section
5(d), no additional legal opinion, other information or instructions shall be required of the Buyers to convert their Preferred Shares.
The Company shall honor conversions of the Preferred Shares and shall deliver the Conversion Shares in accordance with the terms, conditions
and time periods set forth in the Certificate of Designations. Without limiting the preceding sentences, no ink-original Conversion Notice
shall be required, nor shall any medallion guarantee (or other type of guarantee or notarization) of any Conversion Notice form be required
in order to convert the Preferred Shares.
(s) General Solicitation.
None of the Company, any of its affiliates (as defined in Rule 501(b) under the 1933 Act) or any person acting on behalf of the Company
or such affiliate will solicit any offer to buy or offer or sell the Securities by means of any form of general solicitation or general
advertising within the meaning of Regulation D, including: (i) any advertisement, article, notice or other communication published
in any newspaper, magazine or similar medium or broadcast over television or radio; and (ii) any seminar or meeting whose attendees have
been invited by any general solicitation or general advertising.
(t) Integration. None
of the Company, any of its affiliates (as defined in Rule 501(b) under the 1933 Act), or any person acting on behalf of the Company or
such affiliate will sell, offer for sale, or solicit offers to buy or otherwise negotiate in respect of any security (as defined in the
1933 Act) which will be integrated with the sale of the Securities in a manner which would require the registration of the Securities
under the 1933 Act or require stockholder approval under the rules and regulations of the Principal Market and the Company will take
all action that is appropriate or necessary to assure that its offerings of other securities will not be integrated for purposes of the
1933 Act or the rules and regulations of the Principal Market, with the issuance of Securities contemplated hereby.
(u) Notice of Disqualification
Events. The Company will notify the Buyer 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.
5. REGISTER;
TRANSFER AGENT INSTRUCTIONS; LEGEND.
(a) Register. The
Company shall maintain at its principal executive offices (or such other office or agency of the Company as it may designate by notice
to each holder of Securities), a register for the Preferred Shares in which the Company shall record the name and address of the Person
in whose name the Preferred Shares have been issued (including the name and address of each transferee), the aggregate number of Preferred
Shares held by such Person, the number of Conversion Shares issuable pursuant to the terms of the Preferred Shares held by such Person.
The Company shall keep the register open and available at all times during business hours for inspection of the Buyer or its legal representatives.
(b) Transfer Agent Instructions.
The Company shall issue irrevocable instructions to its transfer agent and any subsequent transfer agent (as applicable, the “Transfer
Agent”) in a form acceptable to the Buyer (the “Irrevocable Transfer Agent Instructions”) to issue certificates
or credit shares to the applicable balance accounts at The Depository Trust Company (“DTC”), registered in the name
of the Buyer or its respective nominee(s), for the Conversion Shares in such amounts as specified from time to time by the Buyer to the
Company upon conversion of the Preferred Shares. The Company represents and warrants that no instruction other than the Irrevocable Transfer
Agent Instructions referred to in this Section 5(b), and stop transfer instructions to give effect to Section 2(g) hereof, will
be given by the Company to its transfer agent with respect to the Securities, and that the Securities shall otherwise be freely transferable
on the books and records of the Company, as applicable, to the extent provided in this Agreement and the other Transaction Documents.
If the Buyer effects a sale, assignment or transfer of the Securities in accordance with Section 2(g), the Company shall permit the transfer
and shall promptly instruct its transfer agent to issue one or more certificates or credit shares to the applicable balance accounts
at DTC in such name and in such denominations as specified by the Buyer to effect such sale, transfer or assignment. In the event that
such sale, assignment or transfer involves Conversion Shares sold, assigned or transferred pursuant to an effective registration statement
or in compliance with Rule 144, the transfer agent shall issue such shares to the Buyer, assignee or transferee (as the case may be)
without any restrictive legend in accordance with Section 5(d) below. The Company acknowledges that a breach by it of its obligations
hereunder will cause irreparable harm to a Buyer. Accordingly, the Company acknowledges that the remedy at law for a breach of its obligations
under this Section 5(b) will be inadequate and agrees, in the event of a breach or threatened breach by the Company of the provisions
of this Section 5(b), that the Buyer shall be entitled, in addition to all other available remedies, to an order and/or injunction
restraining any breach and requiring immediate issuance and transfer, without the necessity of showing economic loss and without any
bond or other security being required. Any fees (with respect to the transfer agent, counsel to the Company or otherwise) associated
with the issuance of such opinion or the removal of any legends on any of the Securities shall be borne by the Company.
(c) Legends. The Buyer
understands that the Securities have been issued (or will be issued in the case of the Conversion Shares) pursuant to an exemption from
registration or qualification under the 1933 Act and applicable state securities laws, and except as set forth below, the Securities
shall bear any legend as required by the “blue sky” laws of any state and a restrictive legend in substantially the following
form (and a stop-transfer order may be placed against transfer of such stock certificates):
NEITHER THE ISSUANCE AND SALE OF THE SECURITIES
REPRESENTED BY THIS CERTIFICATE NOR THE SECURITIES INTO WHICH THESE SECURITIES ARE CONVERTIBLE [HAVE BEEN][THE SECURITIES REPRESENTED
BY THIS CERTIFICATE HAVE NOT BEEN] REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE STATE SECURITIES LAWS. THE SECURITIES
MAY NOT BE OFFERED FOR SALE, SOLD, TRANSFERRED OR ASSIGNED (I) IN THE ABSENCE OF (A) AN EFFECTIVE REGISTRATION STATEMENT FOR THE SECURITIES
UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR (B) AN OPINION OF COUNSEL TO THE HOLDER (IF REQUESTED BY THE COMPANY), IN A FORM REASONABLY
ACCEPTABLE TO THE COMPANY, THAT REGISTRATION IS NOT REQUIRED UNDER SAID ACT OR (II) UNLESS SOLD OR ELIGIBLE TO BE SOLD PURSUANT TO RULE
144 OR RULE 144A UNDER SAID ACT. NOTWITHSTANDING THE FOREGOING, THE SECURITIES MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT
OR OTHER LOAN OR FINANCING ARRANGEMENT SECURED BY THE SECURITIES.
(d) Removal of Legends.
Certificates evidencing Securities shall not be required to contain the legend set forth in Section 5(c) above or any other legend
(i) while a registration statement (including a Registration Statement) covering the resale of such Securities is effective under the
1933 Act, (ii) following any sale of such Securities pursuant to Rule 144 (assuming the transferor is not an affiliate of the Company),
(iii) if such Securities are eligible to be sold, assigned or transferred under Rule 144 (provided that the Buyer provides the Company
with reasonable assurances that such Securities are eligible for sale, assignment or transfer under Rule 144 which shall not include
an opinion of Buyer’s counsel), (iv) in connection with a sale, assignment or other transfer (other than under Rule 144), provided
that the Buyer provides the Company with an opinion of counsel to the Buyer, in a generally acceptable form, to the effect that such
sale, assignment or transfer of the Securities may be made without registration under the applicable requirements of the 1933 Act or
(v) if such legend is not required under applicable requirements of the 1933 Act (including, without limitation, controlling judicial
interpretations and pronouncements issued by the SEC). If a legend is not required pursuant to the foregoing, the Company shall no later
than two (2) Trading Days (or such earlier date as required pursuant to the 1934 Act or other applicable law, rule or regulation for
the settlement of a trade initiated on the date the Buyer delivers such legended certificate representing such Securities to the Company)
following the delivery by the Buyer to the Company or the transfer agent (with notice to the Company) of a legended certificate representing
such Securities (endorsed or with stock powers attached, signatures guaranteed, and otherwise in form necessary to affect the reissuance
and/or transfer, if applicable), together with any other deliveries from the Buyer as may be required above in this Section 5(d),
as directed by the Buyer, either: (A) provided that the Company’s transfer agent is participating in the DTC Fast Automated Securities
Transfer Program (“FAST”) and such Securities are Conversion Shares, credit the aggregate number of shares of Common
Stock to which the Buyer shall be entitled to the Buyer’s or its designee’s balance account with DTC through its Deposit/Withdrawal
at Custodian system or (B) if the Company’s transfer agent is not participating in FAST, issue and deliver (via reputable overnight
courier) to the Buyer, a certificate representing such Securities that is free from all restrictive and other legends, registered in
the name of the Buyer or its designee (the date by which such credit is so required to be made to the balance account of the Buyer’s
or the Buyer’s designee with DTC or such certificate is required to be delivered to the Buyer pursuant to the foregoing is referred
to herein as the “Required Delivery Date”, and the date such shares of Common Stock are actually delivered without
restrictive legend to the Buyer or the Buyer’s designee with DTC, as applicable, the “Share Delivery Date”).
The Company shall be responsible for any transfer agent fees or DTC fees with respect to any issuance of Securities or the removal of
any legends with respect to any Securities in accordance herewith.
(e) Failure to Timely
Deliver; Buy-In. If the Company fails, for any reason or for no reason, to issue and deliver (or cause to be delivered) to the Buyer
(or its designee) by the Required Delivery Date, either (I) if the Transfer Agent is not participating in FAST, a certificate for the
number of Conversion Shares to which the Buyer is entitled and register such Conversion Shares on the Company’s share register
or, if the Transfer Agent is participating in FAST, to credit the balance account of the Buyer or the Buyer’s designee with DTC
for such number of Conversion Shares (as the case may be) submitted for legend removal by the Buyer pursuant to Section 5(d) above or
(II) if a registration statement covering the resale of the Conversion Shares (as the case may be) submitted for legend removal by such
Buyer pursuant to Section 5(d) above (the “Unavailable Shares”) is not available for the resale of such Unavailable
Shares and the Company fails to promptly, but in no event later than as required pursuant to the Registration Rights Agreement (x) so
notify the Buyer and (y) deliver the Conversion Shares, electronically without any restrictive legend by crediting such aggregate number
of Conversion Shares submitted for legend removal by the Buyer pursuant to Section 5(d) above to the Buyer’s or its designee’s
balance account with DTC through its Deposit/Withdrawal At Custodian system (the event described in the immediately foregoing clause
(II) is hereinafter referred as a “Notice Failure” and together with the event described in clause (I) above, a “Delivery
Failure”), then, in addition to all other remedies available to the Buyer, the Company shall pay in cash to the Buyer on each
day after the Share Delivery Date and during such Delivery Failure an amount equal to 2% of the product of (A) the sum of the number
of shares of Common Stock not issued to the Buyer on or prior to the Required Delivery Date and to which the Buyer is entitled, and (B)
any trading price of the Common Stock selected by the Buyer in writing as in effect at any time during the period beginning on the date
of the delivery by the Buyer to the Company of the applicable Conversion Shares and ending on the applicable Share Delivery Date. In
addition to the foregoing, if on or prior to the Required Delivery Date either (I) if the Transfer Agent is not participating in FAST,
the Company shall fail to issue and deliver a certificate to the Buyer and register such shares of Common Stock on the Company’s
share register or, if the Transfer Agent is participating in FAST, credit the balance account of the Buyer or the Buyer’s designee
with DTC for the number of shares of Common Stock to which the Buyer submitted for legend removal by the Buyer pursuant to Section 5(d)
above (ii) below or (II) a Notice Failure occurs, and if on or after such Trading Day the Buyer acquires (in an open market transaction,
stock loan or otherwise) shares of Common Stock to deliver in satisfaction of a sale by the Buyer of shares of Common Stock submitted
for legend removal by the Buyer pursuant to Section 5(d) above that the Buyer is entitled to receive from the Company (a “Buy-In”),
then the Company shall, within two (2) Trading Days after the Buyer’s request and in the Buyer’s discretion, either (i) pay
cash to the Buyer in an amount equal to the Buyer’s total purchase price (including brokerage commissions, stock loan costs and
other out-of-pocket expenses, if any) for the shares of Common Stock so acquired (including, without limitation, by any other Person
in respect, or on behalf, of the Buyer) (the “Buy-In Price”), at which point the Company’s obligation to so
deliver such certificate or credit the Buyer’s balance account shall terminate and such shares shall be cancelled, or (ii) promptly
honor its obligation to so deliver to the Buyer a certificate or certificates or credit the balance account of the Buyer or such Buyer’s
designee with DTC representing such number of shares of Common Stock that would have been so delivered if the Company timely complied
with its obligations hereunder and pay cash to the Buyer in an amount equal to the excess (if any) of the Buy-In Price over the product
of (A) such number of shares of Conversion Shares that the Company was required to deliver to the Buyer by the Required Delivery 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 the Buyer to the Company of the applicable Conversion Shares and ending on the date of such delivery and payment under this
clause (ii). Nothing shall limit the Buyer’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 certificates representing shares of Common Stock (or to electronically deliver such shares of Common Stock) as required
pursuant to the terms hereof. Notwithstanding anything herein to the contrary, with respect to any given Notice Failure and/or Delivery
Failure, this Section 5(e) shall not apply to the Buyer the extent the Company has already paid such amounts in full to the Buyer with
respect to such Notice Failure and/or Delivery Failure, as applicable, pursuant to the analogous sections of the Certificate of Designations
with respect to the Preferred Shares then held by such Buyer.
6. CONDITIONS
TO THE COMPANY’S OBLIGATION TO SELL.
(a) The
obligation of the Company hereunder to issue and sell the Preferred Shares to the Buyer at the Closing is subject to the satisfaction,
at or before the Closing Date, of each of the following conditions, provided that these conditions are for the Company’s sole benefit
and may be waived by the Company at any time in its sole discretion by providing the Buyer with prior written notice thereof:
(i) The
Buyer shall have executed each of the other Transaction Documents to which it is a party and delivered the same to the Company.
(ii) The
Buyer shall have delivered to the Company the Purchase for the Preferred Shares being purchased by the Buyer at the Closing by wire transfer
of immediately available funds in accordance with the Flow of Funds Letter.
7. CONDITIONS
TO THE BUYER’S OBLIGATION TO PURCHASE.
(a) The
obligation of the Buyer hereunder to purchase its Preferred Shares at the Closing is subject to the satisfaction, at or before the Closing
Date, of each of the following conditions, provided that these conditions are for the Buyer’s sole benefit and may be waived by
the Buyer at any time in its sole discretion by providing the Company with prior written notice thereof:
(i) The
Company shall have duly executed and delivered to the Buyer each of the Transaction Documents to which it is a party and the Company shall
have duly executed and delivered to such Buyer (A) such aggregate number of Preferred Shares as set forth across from the Buyer’s
name in column (3) of the Schedule of Buyers, , as being purchased by the Buyer at the Closing pursuant to this Agreement.
(ii) The
Company shall have delivered to the Buyer a copy of the Irrevocable Transfer Agent Instructions, in the form acceptable to the Buyer,
which instructions shall have been delivered to and acknowledged in writing by the Company’s transfer agent.
(iii) The
Company shall have delivered to the Buyer a letter from the Company’s transfer agent certifying the number of shares of Common Stock
outstanding on the Closing Date immediately prior to the Closing.
(iv) The
Common Stock (A) shall be designated for quotation or listed (as applicable) on the Principal Market and (B) shall not have been suspended,
as of the Closing Date, by the SEC or the Principal Market from trading on the Principal Market nor shall suspension by the SEC or the
Principal Market have been threatened, as of the Closing Date, either (I) in writing by the SEC or the Principal Market or (II) by falling
below the minimum maintenance requirements of the Principal Market
(v) The
Company shall have obtained all governmental, regulatory or third party consents and approvals, if any, necessary for the sale of the
Securities, including without limitation, those required by the Principal Market, if any.
(vi) No
statute, rule, regulation, executive order, decree, ruling or injunction shall have been enacted, entered, promulgated or endorsed by
any court or Governmental Entity of competent jurisdiction that prohibits the consummation of any of the transactions contemplated by
the Transaction Documents.
(vii) The
Company shall have obtained approval of the Principal Market to list or designate for quotation the Conversion Shares.
(viii) The
Buyer shall have received a letter on the letterhead of the Company, duly executed by the Chief Executive Officer of the Company, setting
forth the wire amounts of the Buyer and the wire transfer instructions of the Company (the “Flow of Funds Letter”).
(ix) The
Company and its Subsidiaries shall have delivered to the Buyer such other documents, instruments or certificates relating to the transactions
contemplated by this Agreement as such Buyer or its counsel may reasonably request.
8. OMITTED
9. MISCELLANEOUS.
(a) Governing Law; Jurisdiction;
Jury Trial. All questions concerning the construction, validity, enforcement and interpretation of this Agreement shall be governed
by the internal laws of the State of New York, without giving effect to any choice of law or conflict of law provision or rule (whether
of the State of New York or any other jurisdictions) that would cause the application of the laws of any jurisdictions other than the
State of New York. The Company hereby irrevocably submits to the exclusive jurisdiction of the state and federal courts sitting in The
City of New York, Borough of Manhattan, for the adjudication of any dispute hereunder or in connection herewith or under any of the other
Transaction Documents or with any transaction contemplated hereby or thereby, and hereby irrevocably waives, and agrees not to assert
in any suit, action or proceeding, any claim that it is not personally subject to the jurisdiction of any such court, that such suit,
action or proceeding is brought in an inconvenient forum or that the venue of such suit, action or proceeding is improper. 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 to such party at the address for such 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 manner permitted by law. Nothing contained herein shall be deemed or operate to preclude the Buyer from bringing
suit or taking other legal action against the Company in any other jurisdiction to collect on the Company’s obligations to the
Buyer or to enforce a judgment or other court ruling in favor of the Buyer. EACH PARTY HEREBY IRREVOCABLY WAIVES ANY RIGHT IT MAY
HAVE TO, AND AGREES NOT TO REQUEST, A JURY TRIAL FOR THE ADJUDICATION OF ANY DISPUTE HEREUNDER OR UNDER ANY OTHER TRANSACTION DOCUMENT
OR IN CONNECTION WITH OR ARISING OUT OF THIS AGREEMENT, ANY OTHER TRANSACTION DOCUMENT OR ANY TRANSACTION CONTEMPLATED HEREBY OR THEREBY.
(b) Counterparts.
This Agreement may be executed in two or more identical counterparts, all of which shall be considered one and the same agreement and
shall become effective when counterparts have been signed by each party and delivered to the other party. In the event that any signature
is delivered by facsimile transmission or by an e-mail which contains a portable document format (.pdf) file of an executed signature
page, such signature page 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 signature page were an original thereof.
(c) Headings; Gender.
The headings of this Agreement are for convenience of reference and shall not form part of, or affect the interpretation of, this Agreement.
Unless the context clearly indicates otherwise, each pronoun herein shall be deemed to include the masculine, feminine, neuter, singular
and plural forms thereof. The terms “including,” “includes,” “include” and words of like import shall
be construed broadly as if followed by the words “without limitation.” The terms “herein,” “hereunder,”
“hereof” and words of like import refer to this entire Agreement instead of just the provision in which they are found.
(d) Severability; Maximum
Payment Amounts. If any provision of this Agreement is prohibited by law or otherwise determined to be invalid or unenforceable by
a court of competent jurisdiction, the provision that would otherwise be prohibited, invalid or unenforceable shall be deemed amended
to apply to the broadest extent that it would be valid and enforceable, and the invalidity or unenforceability of such provision shall
not affect the validity of the remaining provisions of this Agreement so long as this Agreement as so modified continues to express,
without material change, the original intentions of the parties as to the subject matter hereof and the prohibited nature, invalidity
or unenforceability of the provision(s) in question does not substantially impair the respective expectations or reciprocal obligations
of the parties or the practical realization of the benefits that would otherwise be conferred upon the parties. The parties will endeavor
in good faith negotiations to replace the prohibited, invalid or unenforceable provision(s) with a valid provision(s), the effect of
which comes as close as possible to that of the prohibited, invalid or unenforceable provision(s). Notwithstanding anything to the contrary
contained in this Agreement or any other Transaction Document (and without implication that the following is required or applicable),
it is the intention of the parties that in no event shall amounts and value paid by the Company and/or any of its Subsidiaries (as the
case may be), or payable to or received by the Buyer, under the Transaction Documents (including without limitation, any amounts that
would be characterized as “interest” under applicable law) exceed amounts permitted under any applicable law. Accordingly,
if any obligation to pay, payment made to the Buyer, or collection by the Buyer pursuant the Transaction Documents is finally judicially
determined to be contrary to any such applicable law, such obligation to pay, payment or collection shall be deemed to have been made
by mutual mistake of the Buyer, the Company and its Subsidiaries and such amount shall be deemed to have been adjusted with retroactive
effect to the maximum amount or rate of interest, as the case may be, as would not be so prohibited by the applicable law. Such adjustment
shall be effected, to the extent necessary, by reducing or refunding, at the option of the Buyer, the amount of interest or any other
amounts which would constitute unlawful amounts required to be paid or actually paid to the Buyer under the Transaction Documents. For
greater certainty, to the extent that any interest, charges, fees, expenses or other amounts required to be paid to or received by the
Buyer under any of the Transaction Documents or related thereto are held to be within the meaning of “interest” or another
applicable term to otherwise be violative of applicable law, such amounts shall be pro-rated over the period of time to which they relate.
(e) Entire Agreement;
Amendments. This Agreement, the other Transaction Documents and the schedules and exhibits attached hereto and thereto and the instruments
referenced herein and therein supersede all other prior oral or written agreements between the Buyer, the Company, its Subsidiaries,
their affiliates and Persons acting on their behalf, including, without limitation, any transactions by the Buyer with respect to Common
Stock or the Securities, and the other matters contained herein and therein, and this Agreement, the other Transaction Documents, the
schedules and exhibits attached hereto and thereto and the instruments referenced herein and therein contain the entire understanding
of the parties solely with respect to the matters covered herein and therein; provided, however, nothing contained in this Agreement
or any other Transaction Document shall (or shall be deemed to) (i) have any effect on any agreements the Buyer has entered into with,
or any instruments the Buyer has received from, the Company or any of its Subsidiaries prior to the date hereof with respect to any prior
investment made by the Buyer in the Company or (ii) waive, alter, modify or amend in any respect any obligations of the Company or any
of its Subsidiaries, or any rights of or benefits to the Buyer or any other Person, in any agreement entered into prior to the date hereof
between or among the Company and/or any of its Subsidiaries and the Buyer, or any instruments the Buyer received from the Company and/or
any of its Subsidiaries prior to the date hereof, and all such agreements and instruments shall continue in full force and effect. Except
as specifically set forth herein or therein, neither the Company nor the Buyer makes any representation, warranty, covenant or undertaking
with respect to such matters. For clarification purposes, the Recitals are part of this Agreement. No provision of this Agreement may
be amended other than by an instrument in writing signed by the Company and the. No waiver shall be effective unless it is in writing
and signed by an authorized representative of the waiving party No consideration (other than reimbursement of legal fees) shall be offered
or paid to any Person to amend or consent to a waiver or modification of any provision of any of the Transaction Documents unless the
same consideration also is offered to all of the parties to the Transaction Documents, all holders of the Preferred Shares. As a material
inducement for each Buyer to enter into this Agreement, the Company expressly acknowledges and agrees that (x) no due diligence or other
investigation or inquiry conducted by the Buyer, any of its advisors or any of its representatives shall affect the Buyer’s right
to rely on, or shall modify or qualify in any manner or be an exception to any of, the Company’s representations and warranties
contained in this Agreement or any other Transaction Document and (y) unless a provision of this Agreement or any other Transaction Document
is expressly preceded by the phrase “except as disclosed in the SEC Documents,” nothing contained in any of the SEC Documents
shall affect the Buyer’s right to rely on, or shall modify or qualify in any manner or be an exception to any of, the Company’s
representations and warranties contained in this Agreement or any other Transaction Document.
(f) Notices. Any notices,
consents, waivers or other communications required or permitted to be given under the terms of this Agreement must be in writing and
will be deemed to have been delivered: (i) upon receipt, when delivered personally; (ii) upon receipt, when sent by electronic mail (provided
that such sent email is kept on file (whether electronically or otherwise) by the sending party and the sending party does not receive
an automatically generated message from the recipient’s email server that such e-mail could not be delivered to such recipient);
or (iii) one (1) Business Day after deposit with an overnight courier service with next day delivery specified, in each case, properly
addressed to the party to receive the same. The mailing addresses and e-mail addresses for such communications shall be:
If to the Company:
Evofem Biosciences, Inc.
7770 Regents Road, Suite 113-618
San Diego, CA 92122
Telephone: (858) 550-1900
Attention: Chief Financial Officer
E-Mail: Izhang@evofem.com
With a copy (for informational purposes only) to:
Procopio Cory Hargreaves & Savitch, LLP
12544 High Bluff Drive
Suite 400
San Diego, CA 92130
Telephone: (858) 523-4305
E-Mail: paul.johnson@procopio.com
If to the Transfer Agent:
Pacific Stock Transfer
6725 Via Austi Pkwy, Suite 300
Las Vegas, NV 89119
Telephone: (702) 323-0033
Attention: Joslyn Claiborne
E-Mail: jclairborne@pacificstocktransfer.com
If to the Buyer, to its mailing address and e-mail
address set forth on the Schedule of Buyers, with copies to the Buyer’s representatives as set forth on the Schedule of Buyers,
[Aditxt, Inc.]
with a copy (for informational purposes only) to:
Sheppard, Mullin Richter & Hampton LLP
30 Rockefeller Plaza
New York, NY 10112-0015
Telephone: 1-212-634-3073
Attention: John R. Hempill, Esq.
E-mail: JHempill@sheppardmullin.com
or to such other mailing address and/or e-mail
address and/or to the attention of such other Person as the recipient party has specified by written notice given to each other party
five (5) days prior to the effectiveness of such change, provided that Sheppard, Mullin Richter & Hampton LLP shall only be provided
copies of notices sent to the Buyer. Written confirmation of receipt (A) given by the recipient of such notice, consent, waiver or other
communication, (B) mechanically or electronically generated by the sender’s e-mail containing the time, date and recipient’s
e-mail or (C) provided by an overnight courier service shall be rebuttable evidence of personal service, receipt by e-mail or receipt
from an overnight courier service in accordance with clause (i), (ii) or (iii) above, respectively.
(g) Successors and Assigns.
This Agreement shall be binding upon and inure to the benefit of the parties and their respective successors and assigns, including any
purchasers of any of the Preferred Shares. The Company shall not assign this Agreement or any rights or obligations hereunder without
the prior written consent of the Buyer, including, without limitation, a Fundamental Transaction (as defined in the Certificate of Designations)
(unless the Company is in compliance with the applicable provisions governing Fundamental Transactions set forth in the Certificate of
Designations). The Buyer may assign some or all of its rights hereunder in connection with any transfer of any of its Securities without
the consent of the Company, in which event such assignee shall be deemed to be a Buyer hereunder with respect to such assigned rights.
(h) No Third Party Beneficiaries.
This Agreement is intended for the benefit of the parties hereto and their respective permitted successors and assigns, and is not for
the benefit of, nor may any provision hereof be enforced by, any other Person, other than the Indemnitees referred to in Section 9(k).
(i) Survival. The
representations, warranties, agreements and covenants shall survive the Closing.
(j) Further Assurances.
Each party shall do and perform, or cause to be done and performed, all such further acts and things, and shall execute and deliver all
such other agreements, certificates, instruments and documents, as any other party may reasonably request in order to carry out the intent
and accomplish the purposes of this Agreement and the consummation of the transactions contemplated hereby.
(k) Indemnification.
In consideration of the Buyer’s execution and delivery of the Transaction Documents and acquiring the Securities thereunder and
in addition to all of the Company’s other obligations under the Transaction Documents, the Company shall defend, protect, indemnify
and hold harmless the Buyer and each holder of any Securities and all of their stockholders, partners, members, officers, directors,
employees and direct or indirect investors and any of the foregoing Persons’ agents or other representatives (including, without
limitation, those retained in connection with the transactions contemplated by this Agreement) (collectively, the “Indemnitees”)
from and against any and all actions, causes of action, suits, claims, losses, costs, penalties, fees, liabilities and damages, and expenses
in connection therewith (irrespective of whether any such Indemnitee is a party to the action for which indemnification hereunder is
sought), and including reasonable attorneys’ fees and disbursements (the “Indemnified Liabilities”), incurred
by any Indemnitee as a result of, or arising out of, or relating to (i) any misrepresentation or breach of any representation or warranty
made by the Company or any Subsidiary in any of the Transaction Documents, (ii) any breach of any covenant, agreement or obligation of
the Company or any Subsidiary contained in any of the Transaction Documents or (iii) any cause of action, suit, proceeding or claim brought
or made against such Indemnitee by a third party (including for these purposes a derivative action brought on behalf of the Company or
any Subsidiary) or which otherwise involves such Indemnitee that arises out of or results from (A) the execution, delivery, performance
or enforcement of any of the Transaction Documents, (B) any transaction financed or to be financed in whole or in part, directly or indirectly,
with the proceeds of the issuance of the Securities, (C) any disclosure properly made by the Buyer pursuant to Section 4(i), or
(D) the status of the Buyer or holder of the Securities either as an investor in the Company pursuant to the transactions contemplated
by the Transaction Documents or as a party to this Agreement (including, without limitation, as a party in interest or otherwise in any
action or proceeding for injunctive or other equitable relief). To the extent that the foregoing undertaking by the Company may be unenforceable
for any reason, the Company shall make the maximum contribution to the payment and satisfaction of each of the Indemnified Liabilities
which is permissible under applicable law. Except as otherwise set forth herein, the mechanics and procedures with respect to the rights
and obligations under this Section 9(k) shall be the same as those set forth in Section 6 of the Registration Rights Agreement.
(l) Construction.
The language used in this Agreement will be deemed to be the language chosen by the parties to express their mutual intent, and no rules
of strict construction will be applied against any party. No specific representation or warranty shall limit the generality or applicability
of a more general representation or warranty. Each and every reference to share prices, shares of Common Stock and any other numbers
in this Agreement that relate to the Common Stock shall be automatically adjusted for any stock splits, stock dividends, stock combinations,
recapitalizations or other similar transactions that occur with respect to the Common Stock after the date of this Agreement. Notwithstanding
anything in this Agreement to the contrary, 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 the Buyer (or its broker or other financial representative) to effect
short sales or similar transactions in the future.
(m) Remedies. The
Buyer and in the event of assignment by Buyer of its rights and obligations hereunder, each holder of Securities, shall have all rights
and remedies set forth in the Transaction Documents and all rights and remedies which such holders have been granted at any time under
any other agreement or contract and all of the rights which such holders have under any law. Any Person having any rights under any provision
of this Agreement shall be entitled to enforce such rights specifically (without posting a bond or other security), to recover damages
by reason of any breach of any provision of this Agreement and to exercise all other rights granted by law. Furthermore, the Company
recognizes that in the event that it or any Subsidiary fails to perform, observe, or discharge any or all of its or such Subsidiary’s
(as the case may be) obligations under the Transaction Documents, any remedy at law would inadequate relief to the Buyer. The Company
therefore agrees that the Buyer shall be entitled to specific performance and/or temporary, preliminary and permanent injunctive or other
equitable relief from any court of competent jurisdiction in any such case without the necessity of proving actual damages and without
posting a bond or other security. The remedies provided in this Agreement and the other Transaction Documents shall be cumulative and
in addition to all other remedies available under this Agreement and the other Transaction Documents, at law or in equity (including
a decree of specific performance and/or other injunctive relief). In addition to the other remedies set forth herein and in the other
Transaction Documents, if (a) this Agreement or any other Transaction Document is placed in the hands of an attorney for collection of
amounts due thereunder or enforcement or is enforced (or such collections are sought) through any legal proceeding or the holder otherwise
takes action to collect amounts due under this Agreement or any other Transaction Document or to enforce the provisions of this Agreement
or any other Transaction Document or (b) there occurs any bankruptcy, reorganization, receivership of the company or other proceedings
affecting company creditors’ rights and involving a claim under this Agreement or any other Transaction Document, then the Company
shall pay the costs incurred by the Buyer or holder of Securities, as applicable, for such collection, enforcement or action or in connection
with such bankruptcy, reorganization, receivership or other proceeding, including, without limitation, attorneys’ fees and disbursements.
(n) Withdrawal Right.
Notwithstanding anything to the contrary contained in (and without limiting any similar provisions of) the Transaction Documents, whenever
the Buyer exercises a right, election, demand or option under a Transaction Document and the Company or any Subsidiary does not timely
perform its related obligations within the periods therein provided, then the Buyer may rescind or withdraw, in its sole discretion from
time to time upon written notice to the Company or such Subsidiary (as the case may be), any relevant notice, demand or election in whole
or in part without prejudice to its future actions and rights.
(o) Payment Set Aside;
Currency. To the extent that the Company makes a payment or payments to the Buyer hereunder or pursuant to any of the other Transaction
Documents or the Buyer enforces or exercises its rights hereunder or 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, foreign, 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. Unless otherwise expressly
indicated, all dollar amounts referred to in this Agreement and the other Transaction Documents are in United States Dollars (“U.S.
Dollars”), and all amounts owing under this Agreement and all other Transaction Documents shall be paid in U.S. Dollars. All
amounts denominated in other currencies (if any) shall be converted into the U.S. Dollar equivalent amount in accordance with the Exchange
Rate on the date of calculation. “Exchange Rate” means, in relation to any amount of currency to be converted into
U.S. Dollars pursuant to this Agreement, the U.S. Dollar exchange rate as published in the Wall Street Journal on the relevant date of
calculation.
(p) Judgment Currency.
(i) If
for the purpose of obtaining or enforcing judgment against the Company in connection with this Agreement or any other Transaction Document
in any court in any jurisdiction it becomes necessary to convert into any other currency (such other currency being hereinafter in this
Section 9(p) referred to as the “Judgment Currency”) an amount due in US Dollars under this Agreement, the conversion
shall be made at the Exchange Rate prevailing on the Trading Day immediately preceding:
(1) the
date actual payment of the amount due, in the case of any proceeding in the courts of New York or in the courts of any other jurisdiction
that will give effect to such conversion being made on such date: or
(2) the
date on which the foreign court determines, in the case of any proceeding in the courts of any other jurisdiction (the date as of which
such conversion is made pursuant to this Section 9(p)(i)(2) being hereinafter referred to as the “Judgment Conversion Date”).
(ii) If
in the case of any proceeding in the court of any jurisdiction referred to in Section 9(p)(i)(2) above, there is a change in the
Exchange Rate prevailing between the Judgment Conversion Date and the date of actual payment of the amount due, the applicable party shall
pay such adjusted amount as may be necessary to ensure that the amount paid in the Judgment Currency, when converted at the Exchange Rate
prevailing on the date of payment, will produce the amount of US Dollars which could have been purchased with the amount of Judgment Currency
stipulated in the judgment or judicial order at the Exchange Rate prevailing on the Judgment Conversion Date.
(iii) Any
amount due from the Company under this provision shall be due as a separate debt and shall not be affected by judgment being obtained
for any other amounts due under or in respect of this Agreement or any other Transaction Document.
[signature pages follow]
IN WITNESS WHEREOF,
the Buyer and the Company have caused their respective signature page to this Agreement to be duly executed as of the date first written
above.
| |
COMPANY: |
| |
|
| |
EVOFEM BIOSCIENCES, INC. |
| |
| | |
| |
By: | /s/ Saundra Pelletier |
| |
| Name: | Saundra Pelletier |
| |
| Title: | Chief Executive Officer |
IN WITNESS WHEREOF,
the Buyer and the Company have caused their respective signature page to this Agreement to be duly executed as of the date first written
above.
| |
BUYER: |
| |
|
| |
Aditxt, inc. |
| |
| | |
| |
By: | /s/ Amro Albanna |
| |
| Name: | Amro Albanna |
| |
| Title: | Chief Executive Officer |
SCHEDULE OF BUYERS
| (1) |
(2) |
(3) |
(5) |
(9) |
| |
|
|
|
|
Buyer |
Mailing
Address and E-mail Address |
Aggregate
Number of
Preferred Shares |
Purchase
Price |
Legal
Representative’s
Mailing Address and E-mail Address |
| |
|
|
|
|
Aditxt,
Inc. |
[ ] |
500 |
$500,000 |
Sheppard, Mullin Richter & Hampton LLP
30 Rockefeller Plaza
New York, NY 10112-0015
Telephone: 212-634-3073
Attention: John R. Hempill, Esq. |
| |
|
|
|
|
| |
|
|
|
|
| TOTAL |
500 |
$500,000 |
|
Exhibit 10.5
REGISTRATION RIGHTS AGREEMENT
This REGISTRATION RIGHTS
AGREEMENT (this “Agreement”), dated as of July 12, 2024, is by and among Evofem Biosciences, Inc., a Delaware corporation
with offices located at 7770 Regents Road, Suite 113-618, San Diego, CA 92122 (the “Company”), and the undersigned
buyer (“Buyer”).
RECITALS
A. In
connection with the Securities Purchase Agreement by and among the parties hereto, dated as of July [1], 2024 (the “Securities
Purchase Agreement”), the Company has agreed, upon the terms and subject to the conditions of the Securities Purchase Agreement,
to issue and sell to the Buyer the Preferred Shares (as defined in the Securities Purchase Agreement) which will be convertible into Conversion
Shares (as defined in the Securities Purchase Agreement) in accordance with the terms of the Amended and Restated Certificate of Designations
(as defined in the Securities Purchase Agreement).
B. To
induce the Buyer to consummate the transactions contemplated by the Securities Purchase Agreement, the Company has agreed to provide certain
registration rights under the Securities Act of 1933, as amended, and the rules and regulations thereunder, or any similar successor statute
(collectively, the “1933 Act”), and applicable state securities laws.
AGREEMENT
NOW, THEREFORE, in
consideration of the premises and the mutual covenants contained herein and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Company and each of the Buyers hereby agree as follows:
1. Definitions.
Capitalized terms used herein
and not otherwise defined herein shall have the respective meanings set forth in the Securities Purchase Agreement. As used in this Agreement,
the following terms shall have the following meanings:
(a) “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 generally are open for use by customers on such day.
(b) “Closing
Date” shall have the meaning set forth in the Securities Purchase Agreement.
(c) “Effective
Date” means the date that the applicable Registration Statement has been declared effective by the SEC.
(d) “Effectiveness
Deadline” means (i) with respect to the initial Registration Statement required to be filed pursuant to Section 2(a), the
earlier of the (A) 90th calendar day after the Closing Date and (B) 2nd Business Day after the date the Company
is notified (orally or in writing, whichever is earlier) by the SEC that such Registration Statement will not be reviewed or will not
be subject to further review and (ii) with respect to any additional Registration Statements that may be required to be filed by the Company
pursuant to this Agreement, the earlier of the (A) 90th calendar day following the date on which the Company was required to
file such additional Registration Statement and (B) 2nd Business Day after the date the Company is notified (orally or in writing,
whichever is earlier) by the SEC that such Registration Statement will not be reviewed or will not be subject to further review.
(e) “Filing
Deadline” means (i) with respect to the initial Registration Statement required to be filed pursuant to Section 2(a), the
300th calendar day after the Closing Date and (ii) with respect to any additional Registration Statements that may be
required to be filed by the Company pursuant to this Agreement, the date on which the Company was required to file such additional Registration
Statement pursuant to the terms of this Agreement.
(f) “Investor”
means the Buyer or any transferee or assignee of any Registrable Securities or Preferred Shares, as applicable, to whom Buyer assigns
its rights under this Agreement and who agrees to become bound by the provisions of this Agreement in accordance with Section 9 and
any transferee or assignee thereof to whom a transferee or assignee of any Registrable Securities or Preferred Shares as applicable, assigns
its rights under this Agreement and who agrees to become bound by the provisions of this Agreement in accordance with Section 9.
(g) “Person”
means an individual, a limited liability company, a partnership, a joint venture, a corporation, a trust, an unincorporated organization
or a government or any department or agency thereof.
(h) “register,”
“registered,” and “registration” refer to a registration effected by preparing and filing one or
more Registration Statements in compliance with the 1933 Act and pursuant to Rule 415 and the declaration of effectiveness of such Registration
Statement(s) by the SEC.
(i) “Registrable
Securities” means (i) the Conversion Shares, and (ii) any capital stock of the Company issued or issuable with respect to the
Conversion Shares, or the Preferred Shares including, without limitation, (1) as a result of any stock split, stock dividend, recapitalization,
exchange or similar event or otherwise and (2) shares of capital stock of the Company into which the shares of Common Stock (as defined
in the Certificate of Designations) into which the shares of Common Stock are converted or exchanged, in each case, without regard to
any limitations on conversion of the Preferred Shares.
(j) “Registration
Statement” means a registration statement or registration statements of the Company filed under the 1933 Act covering Registrable
Securities.
(l) “Required
Registration Amount” means, as of any time of determination, the sum of (i) 150% of the maximum number of Conversion Shares
issuable upon conversion of the Preferred Shares (assuming for purposes hereof that (x) the Preferred Shares are convertible at the Alternate
Conversion Price (as defined in the Certificate of Designations) assuming an Alternate Conversion Date (as defined in the Certificate
of Designations) as of such applicable date of determination, and (y) any such conversion shall not take into account any limitations
on the conversion of the Preferred Shares set forth in the Certificate of Designations) as of such time of determination, subject to adjustment
as provided in Section 2(d) and/or Section 2(f).
(m) “Rule
144” means Rule 144 promulgated by the SEC under the 1933 Act, as such rule may be amended from time to time, or any other similar
or successor rule or regulation of the SEC that may at any time permit the Investors to sell securities of the Company to the public without
registration.
(n) “Rule
415” means Rule 415 promulgated by the SEC under the 1933 Act, as such rule may be amended from time to time, or any other similar
or successor rule or regulation of the SEC providing for offering securities on a continuous or delayed basis.
(o) “SEC”
means the United States Securities and Exchange Commission or any successor thereto.
2. Registration.
(a) Mandatory
Registration. The Company shall prepare and, as soon as practicable, but in no event later than the Filing Deadline, file with the
SEC an initial Registration Statement on Form S-3 covering the resale of all of the Registrable Securities, provided that such initial
Registration Statement shall register for resale at least the number of shares of Common Stock equal to the Required Registration Amount
as of the date such Registration Statement is initially filed with the SEC; provided further that if Form S-3 is unavailable for such
a registration, the Company shall use such other form as is required by Section 2(c). Such initial Registration Statement, and each other
Registration Statement required to be filed pursuant to the terms of this Agreement, shall contain (except if otherwise directed by the
Investor) the “Selling Stockholders” and “Plan of Distribution” sections in substantially the form
attached hereto as Exhibit B. The Company shall use its best efforts to have such initial Registration Statement, and each other
Registration Statement required to be filed pursuant to the terms of this Agreement, declared effective by the SEC as soon as practicable,
but in no event later than the applicable Effectiveness Deadline for such Registration Statement.
(b) omitted.
(c) Ineligibility
to Use Form S-3. In the event that Form S-3 is not available for the registration of the resale of Registrable Securities hereunder,
the Company shall (i) register the resale of the Registrable Securities on Form S-1 or another appropriate form reasonably acceptable
to the Investor and (ii) undertake to register the resale of the Registrable Securities on Form S-3 as soon as such form is available,
provided that the Company shall maintain the effectiveness of all Registration Statements then in effect until such time as a Registration
Statement on Form S-3 covering the resale of all the Registrable Securities has been declared effective by the SEC and the prospectus
contained therein is available for use.
(d) Sufficient
Number of Shares Registered. In the event the number of shares available under any Registration Statement is insufficient to cover
all of the Registrable Securities required to be covered by such Registration Statement or an Investor’s allocated portion of the
Registrable Securities pursuant to Section 2(h), the Company shall amend such Registration Statement
(if permissible), or file with the SEC a new Registration Statement (on the short form available therefor, if applicable), or both, so
as to cover at least the Required Registration Amount as of the Trading Day (as defined in the Certificate of Designations) immediately
preceding the date of the filing of such amendment or new Registration Statement, in each case, as soon as practicable, but in any event
not later than fifteen (15) days after the necessity therefor arises (but taking account of any Staff position with respect to the date
on which the Staff will permit such amendment to the Registration Statement and/or such new Registration Statement (as the case may be)
to be filed with the SEC). The Company shall use its best efforts to cause such amendment to such Registration Statement and/or such new
Registration Statement (as the case may be) to become effective as soon as practicable following the filing thereof with the SEC, but
in no event later than the applicable Effectiveness Deadline for such Registration Statement. For purposes of the foregoing provision,
the number of shares available under a Registration Statement shall be deemed “insufficient to cover all of the Registrable Securities”
if at any time the number of shares of Common Stock available for resale under the applicable Registration Statement is less than the
product determined by multiplying (i) the Required Registration Amount as of such time by (ii) 0.90. The calculation set forth in the
foregoing sentence shall be made without regard to any limitations on conversion, amortization and/or redemption of the Preferred Shares
(and such calculation shall assume (A) that the Preferred Shares are then convertible in full into shares of Common Stock at the then
prevailing Conversion Rate (as defined in the Certificate of Designations), and (B) the initial outstanding number of Preferred Shares
remains outstanding through the first anniversary of the date hereof and no redemptions of the Preferred Shares occur prior thereto.
(e) Effect
of Failure to File and Obtain and Maintain Effectiveness of any Registration Statement. If (i) a Registration Statement covering the
resale of all of the Registrable Securities required to be covered thereby (disregarding any reduction pursuant to Section 2(f))
and required to be filed by the Company pursuant to this Agreement is (A) not filed with the SEC on or before the Filing Deadline for
such Registration Statement (a “Filing Failure”) (it being understood that if the Company files a Registration Statement
without affording Investor the opportunity to review and comment on the same as required by Section 3(c) hereof, the Company shall
be deemed to not have satisfied this clause (i)(A) and such event shall be deemed to be a Filing Failure) or (B) not declared effective
by the SEC on or before the Effectiveness Deadline for such Registration Statement (an “Effectiveness Failure”) (it
being understood that if on the Business Day immediately following the Effective Date for such Registration Statement the Company shall
not have filed a “final” prospectus for such Registration Statement with the SEC under Rule 424(b) in accordance with Section 3(b)
(whether or not such a prospectus is technically required by such rule), the Company shall be deemed to not have satisfied this clause
(i)(B) and such event shall be deemed to be an Effectiveness Failure), (ii) other than during an Allowable Grace Period (as defined below),
on any day after the Effective Date of a Registration Statement sales of all of the Registrable Securities required to be included on
such Registration Statement (disregarding any reduction pursuant to Section 2(f)) cannot be made pursuant to such Registration Statement
(including, without limitation, because of a failure to keep such Registration Statement effective, a failure to disclose such information
as is necessary for sales to be made pursuant to such Registration Statement, a suspension or delisting of (or a failure to timely list)
the shares of Common Stock on the Principal Market (as defined in the Securities Purchase Agreement) or any other limitations imposed
by the Principal Market, or a failure to register a sufficient number of shares of Common Stock or by reason of a stop order) or the prospectus
contained therein is not available for use for any reason (a “Maintenance Failure”), or (iii) if a Registration Statement
is not effective for any reason or the prospectus contained therein is not available for use for any reason, and either (x) the Company
fails for any reason to satisfy the requirements of Rule 144(c)(1), including, without limitation, the failure to satisfy the current
public information requirement under Rule 144(c) or (y) the Company has ever been an issuer described in Rule 144(i)(1)(i) or becomes
such an issuer in the future, and the Company shall fail to satisfy any condition set forth in Rule 144(i)(2) (a “Current Public
Information Failure”) as a result of which any of the Investors are unable to sell Registrable Securities without restriction
under Rule 144 (including, without limitation, volume restrictions), then, as partial relief for the damages to any holder by reason
of any such delay in, or reduction of, its ability to sell the underlying shares of Common Stock (which remedy shall not be exclusive
of any other remedies available at law or in equity, including, without limitation, specific performance), the Company shall pay to each
holder of Registrable Securities relating to such Registration Statement an amount in cash equal to two percent (2%) of such Investor’s
Purchase Price (as defined in the Securities Purchase Agreement) (1) on the date of such Filing Failure, Effectiveness Failure, Maintenance
Failure or Current Public Information Failure, as applicable, and (2) on every thirty (30) day anniversary of (I) a Filing Failure until
such Filing Failure is cured; (II) an Effectiveness Failure until such Effectiveness Failure is cured; (III) a Maintenance Failure
until such Maintenance Failure is cured; and (IV) a Current Public Information Failure until the earlier of (i) the date such Current
Public Information Failure is cured and (ii) such time that such public information is no longer required pursuant to Rule 144 (in
each case, pro rated for periods totaling less than thirty (30) days). The payments to which a holder of Registrable Securities shall
be entitled pursuant to this Section 2(e) are referred to herein as “Registration Delay Payments.” Following the
initial Registration Delay Payment for any particular event or failure (which shall be paid on the date of such event or failure, as set
forth above), without limiting the foregoing, if an event or failure giving rise to the Registration Delay Payments is cured prior to
any thirty (30) day anniversary of such event or failure, then such Registration Delay Payment shall be made on the third (3rd)
Business Day after such cure. In the event the Company fails to make Registration Delay Payments in a timely manner in accordance with
the foregoing, such Registration Delay Payments shall bear interest at the rate of two percent (2%) per month (prorated for partial months)
until paid in full. Notwithstanding the foregoing, no Registration Delay Payments shall be owed to an Investor (other than with respect
to a Maintenance Failure resulting from a suspension or delisting of (or a failure to timely list) the shares of Common Stock on the Principal
Market) with respect to any period during which all of such Investor’s Registrable Securities may be sold by such Investor without
restriction under Rule 144 (including, without limitation, volume restrictions) and without the need for current public information required
by Rule 144(c)(1) (or Rule 144(i)(2), if applicable).
(f) Offering.
Notwithstanding anything to the contrary contained in this Agreement, but subject to the payment of the Registration Delay Payments pursuant
to Section 2(e), in the event the staff of the SEC (the “Staff”) or the SEC seeks to characterize any offering
pursuant to a Registration Statement filed pursuant to this Agreement as constituting an offering of securities by, or on behalf
of, the Company, or in any other manner, such that the Staff or the SEC do not permit such Registration Statement to become
effective and used for resales in a manner that does not constitute such an offering and that permits the continuous resale at the market
by the Investors participating therein (or as otherwise may be acceptable to each Investor) without being named therein as an
“underwriter,” then the Company shall reduce the number of shares to be included in such Registration Statement by all Investors
until such time as the Staff and the SEC shall so permit such Registration Statement to become effective as aforesaid. In making
such reduction, the Company shall reduce the number of shares to be included by all Investors on a pro rata basis (based upon the number
of Registrable Securities otherwise required to be included for each Investor) unless the inclusion of shares by a particular Investor
or a particular set of Investors are resulting in the Staff or the SEC’s “by or on behalf of the Company” offering position,
in which event the shares held by such Investor or set of Investors shall be the only shares subject to reduction (and if by a set of
Investors on a pro rata basis by such Investors or on such other basis as would result in the exclusion of the least number of shares
by all such Investors); provided, that, with respect to such pro rata portion allocated to any Investor, such Investor may elect the allocation
of such pro rata portion among the Registrable Securities of such Investor. In addition, in the event that the Staff or the SEC requires
any Investor seeking to sell securities under a Registration Statement filed pursuant to this Agreement to be specifically identified
as an “underwriter” in order to permit such Registration Statement to become effective, and such Investor does not consent
to being so named as an underwriter in such Registration Statement, then, in each such case, the Company shall reduce the total
number of Registrable Securities to be registered on behalf of such Investor, until such time as the Staff or the SEC does
not require such identification or until such Investor accepts such identification and the manner thereof. Any reduction pursuant to this
paragraph will first reduce all Registrable Securities other than those issued pursuant to the Securities Purchase Agreement, including
those securities set forth on Schedule 2(i). In the event of any reduction in Registrable Securities pursuant to
this paragraph, an affected Investor shall have the right to require, upon delivery of a written request to the Company signed by
such Investor, the Company to file a registration statement within twenty (20) days of such request (subject to any restrictions imposed
by Rule 415 or required by the Staff or the SEC) for resale by such Investor in a manner acceptable to such Investor, and the
Company shall following such request cause to be and keep effective such registration statement in the same manner as otherwise contemplated in
this Agreement for registration statements hereunder, in each case until such time as: (i) all Registrable Securities held by such
Investor have been registered and sold pursuant to an effective Registration Statement in a manner acceptable to such Investor or
(ii) all Registrable Securities may be resold by such Investor without restriction (including, without limitation, volume limitations)
pursuant to Rule 144 (taking account of any Staff position with respect to “affiliate” status) and without the need for current
public information required by Rule 144(c)(1) (or Rule 144(i)(2), if applicable) or (iii) such Investor agrees to be named as an underwriter
in any such Registration Statement in a manner acceptable to such Investor as to all Registrable Securities held by such Investor and
that have not theretofore been included in a Registration Statement under this Agreement (it being understood that the special demand
right under this sentence may be exercised by an Investor multiple times and with respect to limited amounts of Registrable Securities
in order to permit the resale thereof by such Investor as contemplated above).
(g) Piggyback
Registrations. Without limiting any obligation of the Company hereunder or under the Securities Purchase Agreement, if there is not
an effective Registration Statement covering all of the Registrable Securities or the prospectus contained therein is not available for
use and the Company shall determine to prepare and file with the SEC a registration statement or offering statement relating to an offering
for its own account or the account of others under the 1933 Act of any of its equity securities (other than on Form S-4 or Form S-8 (each
as promulgated under the 1933 Act) or their then equivalents relating to equity securities to be issued solely in connection with any
acquisition of any entity or business or equity securities issuable in connection with the Company’s stock option or other employee
benefit plans), then the Company shall deliver to each Investor a written notice of such determination and, if within fifteen (15)
days after the date of the delivery of such notice, any such Investor shall so request in writing, the Company shall include in such registration
statement or offering statement all or any part of such Registrable Securities such Investor requests to be registered; provided, however,
the Company shall not be required to register any Registrable Securities pursuant to this Section 2(g) that are eligible for resale
pursuant to Rule 144 without restriction (including, without limitation, volume restrictions) and without the need for current public
information required by Rule 144(c)(1) (or Rule 144(i)(2), if applicable) or that are the subject of a then-effective Registration
Statement.
3. Related
Obligations.
The Company shall use its
best efforts to effect the registration of the Registrable Securities in accordance with the intended method of disposition thereof, and,
pursuant thereto, the Company shall have the following obligations:
(a) The
Company shall promptly prepare and file with the SEC a Registration Statement with respect to all the Registrable Securities (but in no
event later than the applicable Filing Deadline) and use its best efforts to cause such Registration Statement to become effective as
soon as practicable after such filing (but in no event later than the Effectiveness Deadline). Subject to Allowable Grace Periods, the
Company shall keep each Registration Statement effective (and the prospectus contained therein available for use) pursuant to Rule 415
for resales by the Investors on a delayed or continuous basis at then-prevailing market prices (and not fixed prices) at all times until
the earlier of (i) the date as of which all of the Investors may sell all of the Registrable Securities required to be covered by such
Registration Statement (disregarding any reduction pursuant to Section 2(f)) without restriction pursuant to Rule 144 (including,
without limitation, volume restrictions) and without the need for current public information required by Rule 144(c)(1) (or Rule 144(i)(2),
if applicable) or (ii) the date on which the Investors shall have sold all of the Registrable Securities covered by such Registration
Statement (the “Registration Period”). Notwithstanding anything to the contrary contained in this Agreement, the Company
shall ensure that, when filed and at all times while effective, each Registration Statement (including, without limitation, all amendments
and supplements thereto) and the prospectus (including, without limitation, all amendments and supplements thereto) used in connection
with such Registration Statement (1) shall not contain any untrue statement of a material fact or omit to state a material fact required
to be stated therein, or necessary to make the statements therein (in the case of prospectuses, in the light of the circumstances in which
they were made) not misleading and (2) will disclose (whether directly or through incorporation by reference to other SEC filings to the
extent permitted) all material information regarding the Company and its securities. The Company shall submit to the SEC, within one (1)
Business Day after the later of the date that (i) the Company learns that no review of a particular Registration Statement will be made
by the Staff or that the Staff has no further comments on a particular Registration Statement (as the case may be) and (ii) the consent
of Legal Counsel is obtained pursuant to Section 3(c) (which consent shall be immediately sought), a request for acceleration of
effectiveness of such Registration Statement to a time and date not later than twenty-four (24) hours after the submission of such
request. The Company shall respond in writing to comments made by the SEC in respect of a Registration Statement as soon as practicable,
but in no event later than fifteen (15) days after the receipt of comments by or notice from the SEC that an amendment is required in
order for a Registration Statement to be declared effective.
(b) Subject
to Section 3(r) of this Agreement, the Company shall prepare and file with the SEC such amendments (including, without limitation,
post-effective amendments) and supplements to each Registration Statement and the prospectus used in connection with each such Registration
Statement, which prospectus is to be filed pursuant to Rule 424 promulgated under the 1933 Act, as may be necessary to keep each such
Registration Statement effective at all times during the Registration Period for such Registration Statement, and, during such period,
comply with the provisions of the 1933 Act with respect to the disposition of all Registrable Securities of the Company required to be
covered by such Registration Statement until such time as all of such Registrable Securities shall have been disposed of in accordance
with the intended methods of disposition by the seller or sellers thereof as set forth in such Registration Statement; provided, however,
by 8:30 a.m. (New York time) on the Business Day immediately following each Effective Date, the Company shall file with the SEC in accordance
with Rule 424(b) under the 1933 Act the final prospectus to be used in connection with sales pursuant to the applicable Registration Statement
(whether or not such a prospectus is technically required by such rule). In the case of amendments and supplements to any Registration
Statement which are required to be filed pursuant to this Agreement (including, without limitation, pursuant to this Section 3(b))
by reason of the Company filing a report on Form 8-K, Form 10-Q or Form 10-K or any analogous report under the Securities Exchange Act
of 1934, as amended (the “1934 Act”), the Company shall, if permitted under the applicable rules and regulations of
the SEC, have incorporated such report by reference into such Registration Statement, if applicable, or shall file such amendments or
supplements with the SEC on the same day on which the 1934 Act report is filed which created the requirement for the Company to amend
or supplement such Registration Statement.
(c) The
Company shall permit legal counsel for Investor to review and comment upon (i) each Registration Statement at least three (3) Business
Days prior to its filing with the SEC and (ii) all amendments and supplements to each Registration Statement (including, without limitation,
the prospectus contained therein) (except for Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K,
and any similar or successor reports) within a reasonable number of days prior to their filing with the SEC, The Company shall promptly
furnish to legal counsel for Investor, without charge, (i) copies of any correspondence from the SEC or the Staff to the Company or its
representatives relating to each Registration Statement, provided that such correspondence shall not contain any material, non-public
information regarding the Company or any of its Subsidiaries (as defined in the Securities Purchase Agreement), (ii) after the same
is prepared and filed with the SEC, one (1) copy of each Registration Statement and any amendment(s) and supplement(s) thereto, including,
without limitation, financial statements and schedules, all documents incorporated therein by reference, if requested by Investor, and
all exhibits and (iii) upon the effectiveness of each Registration Statement, one (1) copy of the prospectus included in such Registration
Statement and all amendments and supplements thereto. The Company shall reasonably cooperate with legal counsel for Investor in performing
the Company’s obligations pursuant to this Section 3.
(d) The
Company shall promptly furnish to each Investor whose Registrable Securities are included in any Registration Statement, without charge,
(i) after the same is prepared and filed with the SEC, at least one (1) copy of each Registration Statement and any amendment(s) and supplement(s)
thereto, including, without limitation, financial statements and schedules, all documents incorporated therein by reference, if requested
by an Investor, all exhibits and each preliminary prospectus, (ii) upon the effectiveness of each Registration Statement, ten (10)
copies of the prospectus included in such Registration Statement and all amendments and supplements thereto (or such other number of copies
as such Investor may reasonably request from time to time) and (iii) such other documents, including, without limitation, copies of any
preliminary or final prospectus, as such Investor may reasonably request from time to time in order to facilitate the disposition of the
Registrable Securities owned by such Investor.
(e) The
Company shall use its best efforts to (i) register and qualify, unless an exemption from registration and qualification applies, the resale
by Investors of the Registrable Securities covered by a Registration Statement under such other securities or “blue sky” laws
of all applicable jurisdictions in the United States, (ii) prepare and file in those jurisdictions, such amendments (including, without
limitation, post-effective amendments) and supplements to such registrations and qualifications as may be necessary to maintain the effectiveness
thereof during the Registration Period, (iii) take such other actions as may be necessary to maintain such registrations and qualifications
in effect at all times during the Registration Period, and (iv) take all other actions reasonably necessary or advisable to qualify the
Registrable Securities for sale in such jurisdictions; provided, however, the Company shall not be required in connection therewith or
as a condition thereto to (x) qualify to do business in any jurisdiction where it would not otherwise be required to qualify but for this
Section 3(e), (y) subject itself to general taxation in any such jurisdiction, or (z) file a general consent to service of process
in any such jurisdiction. The Company shall promptly notify legal counsel for Investor who holds Registrable Securities of the receipt
by the Company of any notification with respect to the suspension of the registration or qualification of any of the Registrable Securities
for sale under the securities or “blue sky” laws of any jurisdiction in the United States or its receipt of actual notice
of the initiation or threatening of any proceeding for such purpose.
(f) The
Company shall notify legal counsel for Investor and in writing of the happening of any event, as promptly as practicable after becoming
aware of such event, as a result of which the prospectus included in a Registration Statement, as then in effect, may include an untrue
statement of a material fact or omission to state a material fact required to be stated therein or necessary to make the statements therein,
in the light of the circumstances under which they were made, not misleading (provided that in no event shall such notice contain any
material, non-public information regarding the Company or any of its Subsidiaries), and, subject to Section 3(r), promptly prepare
a supplement or amendment to such Registration Statement and such prospectus contained therein to correct such untrue statement or omission
and deliver ten (10) copies of such supplement or amendment to legal counsel for Investor. The Company shall also promptly notify legal
counsel for Investor in writing (i) when a prospectus or any prospectus supplement or post-effective amendment has been filed, when a
Registration Statement or any post-effective amendment has become effective (notification of such effectiveness shall be delivered to
legal counsel for Investor by e-mail on the same day of such effectiveness and by overnight mail), and when the Company receives written
notice from the SEC that a Registration Statement or any post-effective amendment will be reviewed by the SEC, (ii) of any request by
the SEC for amendments or supplements to a Registration Statement or related prospectus or related information, (iii) of the Company’s
reasonable determination that a post-effective amendment to a Registration Statement would be appropriate; and (iv) of the receipt of
any request by the SEC or any other federal or state governmental authority for any additional information relating to the Registration
Statement or any amendment or supplement thereto or any related prospectus. The Company shall respond as promptly as practicable to any
comments received from the SEC with respect to each Registration Statement or any amendment thereto (it being understood and agreed that
the Company’s response to any such comments shall be delivered to the SEC no later than fifteen (15) Business Days after the
receipt thereof).
(g) The
Company shall (i) use its best efforts to prevent the issuance of any stop order or other suspension of effectiveness of each Registration
Statement or the use of any prospectus contained therein, or the suspension of the qualification, or the loss of an exemption from qualification,
of any of the Registrable Securities for sale in any jurisdiction and, if such an order or suspension is issued, to obtain the withdrawal
of such order or suspension at the earliest possible moment and (ii) notify legal counsel for Investor who holds Registrable Securities
of the issuance of such order and the resolution thereof or its receipt of actual notice of the initiation or threat of any proceeding
for such purpose.
(h) If
any Investor may be required under applicable securities law to be described in any Registration Statement as an underwriter and such
Investor consents to so being named an underwriter, at the request of any Investor, the Company shall furnish to such Investor, on the
date of the effectiveness of such Registration Statement and thereafter from time to time on such dates as an Investor may reasonably
request (i) a letter, dated such date, from the Company’s independent certified public accountants in form and substance as is customarily
given by independent certified public accountants to underwriters in an underwritten public offering, addressed to the Investors, and
(ii) an opinion, dated as of such date, of counsel representing the Company for purposes of such Registration Statement, in form, scope
and substance as is customarily given in an underwritten public offering, addressed to the Investors.
(i) If
any Investor may be required under applicable securities law to be described in any Registration Statement as an underwriter and such
Investor consents to so being named an underwriter, upon the written request of such Investor, the Company shall make available for inspection
by (i) such Investor, (ii) legal counsel for such Investor and (iii) one (1) firm of accountants or other agents retained by such Investor
(collectively, the “Inspectors”), all pertinent financial and other records, and pertinent corporate documents and
properties of the Company (collectively, the “Records”), as shall be reasonably deemed necessary by each Inspector,
and cause the Company’s officers, directors and employees to supply all information which any Inspector may reasonably request;
provided, however, each Inspector shall agree in writing to hold in strict confidence and not to make any disclosure (except to such Investor)
or use of any Record or other information which the Company’s board of directors determines in good faith to be confidential, and
of which determination the Inspectors are so notified, unless (1) the disclosure of such Records is necessary to avoid or correct a misstatement
or omission in any Registration Statement or is otherwise required under the 1933 Act, (2) the release of such Records is ordered pursuant
to a final, non-appealable subpoena or order from a court or government body of competent jurisdiction, or (3) the information in such
Records has been made generally available to the public other than by disclosure in violation of this Agreement or any other Transaction
Document (as defined in the Securities Purchase Agreement). Such Investor agrees that it shall, upon learning that disclosure of such
Records is sought in or by a court or governmental body of competent jurisdiction or through other means, give prompt notice to the Company
and allow the Company, at its expense, to undertake appropriate action to prevent disclosure of, or to obtain a protective order for,
the Records deemed confidential. Nothing herein (or in any other confidentiality agreement between the Company and such Investor, if any)
shall be deemed to limit any Investor’s ability to sell Registrable Securities in a manner which is otherwise consistent with applicable
laws and regulations.
(j) The
Company shall hold in confidence and not make any disclosure of information concerning an Investor provided to the Company unless (i)
disclosure of such information is necessary to comply with federal or state securities laws, (ii) the disclosure of such information is
necessary to avoid or correct a misstatement or omission in any Registration Statement or is otherwise required to be disclosed in such
Registration Statement pursuant to the 1933 Act, (iii) the release of such information is ordered pursuant to a subpoena or other final,
non-appealable order from a court or governmental body of competent jurisdiction, or (iv) such information has been made generally available
to the public other than by disclosure in violation of this Agreement or any other Transaction Document. The Company agrees that it shall,
upon learning that disclosure of such information concerning an Investor is sought in or by a court or governmental body of competent
jurisdiction or through other means, give prompt written notice to such Investor and allow such Investor, at such Investor’s expense,
to undertake appropriate action to prevent disclosure of, or to obtain a protective order for, such information.
(k) Without
limiting any obligation of the Company under the Securities Purchase Agreement, the Company shall use its best efforts either to (i) cause
all of the Registrable Securities covered by each Registration Statement to be listed on each securities exchange on which securities
of the same class or series issued by the Company are then listed, if any, if the listing of such Registrable Securities is then permitted
under the rules of such exchange, (ii) secure designation and quotation of all of the Registrable Securities covered by each Registration
Statement on an Eligible Market (as defined in the Securities Purchase Agreement), or (iii) if, despite the Company’s best efforts
to satisfy the preceding clauses (i) or (ii) the Company is unsuccessful in satisfying the preceding clauses (i) or (ii), without
limiting the generality of the foregoing, to use its best efforts to arrange for at least two market makers to register with the Financial
Industry Regulatory Authority (“FINRA”) as such with respect to such Registrable Securities. In addition, the Company
shall cooperate with each Investor and any broker or dealer through which any such Investor proposes to sell its Registrable Securities
in effecting a filing with FINRA pursuant to FINRA Rule 5110 as requested by such Investor. The Company shall pay all fees and expenses
in connection with satisfying its obligations under this Section 3(k).
(l) The
Company shall cooperate with the Investors who hold Registrable Securities being offered and, to the extent applicable, facilitate the
timely preparation and delivery of certificates (not bearing any restrictive legend) representing the Registrable Securities to be offered
pursuant to a Registration Statement and enable such certificates to be in such denominations or amounts (as the case may be) as the Investors
may reasonably request from time to time and registered in such names as the Investors may request.
(m) If
requested by an Investor, the Company shall as soon as practicable after receipt of notice from such Investor and subject to Section 3(r)
hereof, (i) incorporate in a prospectus supplement or post-effective amendment such information as an Investor reasonably requests to
be included therein relating to the sale and distribution of Registrable Securities, including, without limitation, information with respect
to the number of Registrable Securities being offered or sold, the purchase price being paid therefor and any other terms of the offering
of the Registrable Securities to be sold in such offering; (ii) make all required filings of such prospectus supplement or post-effective
amendment after being notified of the matters to be incorporated in such prospectus supplement or post-effective amendment; and (iii)
supplement or make amendments to any Registration Statement or prospectus contained therein if reasonably requested by an Investor holding
any Registrable Securities.
(n) The
Company shall use its best efforts to cause the Registrable Securities covered by a Registration Statement to be registered with or approved
by such other governmental agencies or authorities as may be necessary to consummate the disposition of such Registrable Securities.
(o) The
Company shall make generally available to its security holders as soon as practical, but not later than ninety (90) days after the close
of the period covered thereby, an earnings statement (in form complying with, and in the manner provided by, the provisions of Rule 158
under the 1933 Act) covering a twelve-month period beginning not later than the first day of the Company’s fiscal quarter next following
the applicable Effective Date of each Registration Statement.
(p) The
Company shall otherwise use its best efforts to comply with all applicable rules and regulations of the SEC in connection with any registration
hereunder.
(q) Within
one (1) Business Day after a Registration Statement which covers Registrable Securities is declared effective by the SEC, the Company
shall deliver, and shall cause legal counsel for the Company to deliver, to the transfer agent for such Registrable Securities (with copies
to the Investors whose Registrable Securities are included in such Registration Statement) confirmation that such Registration Statement
has been declared effective by the SEC in the form attached hereto as Exhibit A.
(r) Notwithstanding
anything to the contrary herein (but subject to the last sentence of this Section 3(r)), at any time after the Effective Date of
a particular Registration Statement, the Company may delay the disclosure of material, non-public information concerning the Company or
any of its Subsidiaries the disclosure of which at the time is not, in the good faith opinion of the board of directors of the Company,
in the best interest of the Company and, in the opinion of counsel to the Company, otherwise required (a “Grace Period”),
provided that the Company shall promptly notify the Investors in writing of the (i) existence of material, non-public information giving
rise to a Grace Period (provided that in each such notice the Company shall not disclose the content of such material, non-public information
to any of the Investors) and the date on which such Grace Period will begin and (ii) date on which such Grace Period ends, provided
further that (I) no Grace Period shall exceed ten (10) consecutive days and during any three hundred sixty five (365) day period all such
Grace Periods shall not exceed an aggregate of thirty (30) days, (II) the first day of any Grace Period must be at least five (5)
Trading Days after the last day of any prior Grace Period and (III) except as described below, no Grace Period may exist during the sixty
(60) Trading Day period immediately following the Effective Date of such Registration Statement (provided that such sixty (60) Trading
Day period shall be extended by the number of Trading Days during such period and any extension thereof contemplated by this proviso during
which such Registration Statement is not effective or the prospectus contained therein is not available for use) (each, an “Allowable
Grace Period”). Notwithstanding the foregoing, any Registration Delay Payments due and payable as a result of an Effectiveness
Failure will accrue but remain unpaid for sixty (60) calendar days after such Effectiveness Failure (the “Effectiveness Cure
Period”). In the event the Company cures Effectiveness Failure the Effectiveness Cure Period, the accrued but unpaid Registration
Delay Payments shall be forgiven. A failure to cure the Effectiveness Failure in the Effectiveness Cure Period shall result in all Registration
Delay Payments accrued and unpaid since the Effectiveness Failure to be due and payable. For purposes of determining the length of a Grace
Period above, such Grace Period shall begin on and include the date the Investors receive the notice referred to in clause (i) above and
shall end on and include the later of the date the Investors receive the notice referred to in clause (ii) above and the date referred
to in such notice. The provisions of Section 3(g) hereof shall not be applicable during the period of any Allowable Grace Period.
Upon expiration of each Grace Period, the Company shall again be bound by the first sentence of Section 3(f) with respect to the
information giving rise thereto unless such material, non-public information is no longer applicable. Notwithstanding anything to the
contrary contained in this Section 3(r), the Company shall cause its transfer agent to deliver unlegended shares of Common Stock
to a transferee of an Investor in accordance with the terms of the Securities Purchase Agreement in connection with any sale of Registrable
Securities with respect to which such Investor has entered into a contract for sale, and delivered a copy of the prospectus included as
part of the particular Registration Statement to the extent applicable, prior to such Investor’s receipt of the notice of a Grace
Period and for which the Investor has not yet settled.
(s) The
Company shall take all other reasonable actions necessary to expedite and facilitate disposition by each Investors of its Registrable
Securities pursuant to each Registration Statement.
(t) Neither
the Company nor any Subsidiary or affiliate thereof shall identify any Investor as an underwriter in any public disclosure or filing with
the SEC, the Principal Market or any Eligible Market and any Buyer being deemed an underwriter by the SEC shall not relieve the Company
of any obligations it has under this Agreement or any other Transaction Document (as defined in the Securities Purchase Agreement); provided,
however, that the foregoing shall not prohibit the Company from including the disclosure found in the “Plan of Distribution”
section attached hereto as Exhibit B in the Registration Statement.
(u) Neither
the Company nor any of its Subsidiaries has entered, as of the date hereof, nor shall the Company or any of its Subsidiaries, on or after
the date of this Agreement, enter into any agreement with respect to its securities, that would have the effect of impairing the rights
granted to the Buyers in this Agreement or otherwise conflicts with the provisions hereof.
4. Obligations
of the Investors.
(a) At
least five (5) Business Days prior to the first anticipated filing date of each Registration Statement, the Company shall notify each
Investor in writing of the information the Company requires from each such Investor with respect to such Registration Statement. It shall
be a condition precedent to the obligations of the Company to complete the registration pursuant to this Agreement with respect to the
Registrable Securities of a particular Investor that such Investor shall furnish to the Company such information regarding itself, the
Registrable Securities held by it and the intended method of disposition of the Registrable Securities held by it, as shall be reasonably
required to effect and maintain the effectiveness of the registration of such Registrable Securities and shall execute such documents
in connection with such registration as the Company may reasonably request.
(b) Each
Investor, by such Investor’s acceptance of the Registrable Securities, agrees to cooperate with the Company as reasonably requested
by the Company in connection with the preparation and filing of each Registration Statement hereunder, unless such Investor has notified
the Company in writing of such Investor’s election to exclude all of such Investor’s Registrable Securities from such Registration
Statement.
(c) Each
Investor agrees that, upon receipt of any notice from the Company of the happening of any event of the kind described in Section 3(g)
or the first sentence of 3(f), such Investor will immediately discontinue disposition of Registrable Securities pursuant to any Registration
Statement(s) covering such Registrable Securities until such Investor’s receipt of the copies of the supplemented or amended prospectus
contemplated by Section 3(g) or the first sentence of Section 3(f) or receipt of notice that no supplement or amendment is required.
Notwithstanding anything to the contrary in this Section 4(c), the Company shall cause its transfer agent to deliver unlegended shares
of Common Stock to a transferee of an Investor in accordance with the terms of the Securities Purchase Agreement in connection with any
sale of Registrable Securities with respect to which such Investor has entered into a contract for sale prior to the Investor’s
receipt of a notice from the Company of the happening of any event of the kind described in Section 3(g) or the first sentence of
Section 3(f) and for which such Investor has not yet settled.
5. Expenses
of Registration.
(a) All
reasonable expenses, other than underwriting discounts and commissions, incurred in connection with registrations, filings or qualifications
pursuant to Sections 2 and 3, including, without limitation, all registration, listing and qualifications fees, printers and accounting
fees, FINRA filing fees (if any) and fees and disbursements of counsel for the Company shall be paid by the Company. The Company shall
reimburse Legal Counsel for its fees and disbursements in connection with registration, filing or qualification pursuant to Sections 2
and 3 of this Agreement which amount shall be limited to $10,000 for each such registration, filing or qualification.
6. Indemnification.
(a) To
the fullest extent permitted by law, the Company will, and hereby does, indemnify, hold harmless and defend each Investor and each of
its directors, officers, shareholders, members, partners, employees, agents, advisors, representatives (and any other Persons with a functionally
equivalent role of a Person holding such titles notwithstanding the lack of such title or any other title) and each Person, if any, who
controls such Investor within the meaning of the 1933 Act or the 1934 Act and each of the directors, officers, shareholders, members,
partners, employees, agents, advisors, representatives (and any other Persons with a functionally equivalent role of a Person holding
such titles notwithstanding the lack of such title or any other title) of such controlling Persons (each, an “Indemnified Person”),
against any losses, obligations, claims, damages, liabilities, contingencies, judgments, fines, penalties, charges, costs (including,
without limitation, court costs, reasonable attorneys’ fees and costs of defense and investigation), amounts paid in settlement
or expenses, joint or several, (collectively, “Claims”) incurred in investigating, preparing or defending any action,
claim, suit, inquiry, proceeding, investigation or appeal taken from the foregoing by or before any court or governmental, administrative
or other regulatory agency, body or the SEC, whether pending or threatened, whether or not an Indemnified Person is or may be a party
thereto (“Indemnified Damages”), to which any of them may become subject insofar as such Claims (or actions or proceedings,
whether commenced or threatened, in respect thereof) arise out of or are based upon: (i) any untrue statement or alleged untrue statement
of a material fact in a Registration Statement or any post-effective amendment thereto or in any filing made in connection with the qualification
of the offering under the securities or other “blue sky” laws of any jurisdiction in which Registrable Securities are offered
(“Blue Sky Filing”), or the omission or alleged omission to state a material fact required to be stated therein or
necessary to make the statements therein not misleading, (ii) any untrue statement or alleged untrue statement of a material fact contained
in any preliminary prospectus if used prior to the effective date of such Registration Statement, or contained in the final prospectus
(as amended or supplemented, if the Company files any amendment thereof or supplement thereto with the SEC) or the omission or alleged
omission to state therein any material fact necessary to make the statements made therein, in light of the circumstances under which the
statements therein were made, not misleading or (iii) any violation or alleged violation by the Company of the 1933 Act, the 1934 Act,
any other law, including, without limitation, any state securities law, or any rule or regulation thereunder relating to the offer or
sale of the Registrable Securities pursuant to a Registration Statement or (iv) any violation of this Agreement (the matters in the foregoing
clauses (i) through (iv) being, collectively, “Violations”). Subject to Section 6(c), the Company shall reimburse
the Indemnified Persons, promptly as such expenses are incurred and are due and payable, for any legal fees or other reasonable expenses
incurred by them in connection with investigating or defending any such Claim. Notwithstanding anything to the contrary contained herein,
the indemnification agreement contained in this Section 6(a): (i) shall not apply to a Claim by an Indemnified Person arising out
of or based upon a Violation which occurs in reliance upon and in conformity with information furnished in writing to the Company by such
Indemnified Person for such Indemnified Person expressly for use in connection with the preparation of such Registration Statement or
any such amendment thereof or supplement thereto, if such prospectus was timely made available by the Company pursuant to Section 3(d);
and (ii) shall not apply to amounts paid in settlement of any Claim if such settlement is effected without the prior written consent of
the Company, which consent shall not be unreasonably withheld or delayed. Such indemnity shall remain in full force and effect regardless
of any investigation made by or on behalf of the Indemnified Person and shall survive the transfer of any of the Registrable Securities
by any of the Investors pursuant to Section 9.
(b) In
connection with any Registration Statement in which an Investor is participating, such Investor agrees to severally and not jointly indemnify,
hold harmless and defend, to the same extent and in the same manner as is set forth in Section 6(a), the Company, each of its directors,
each of its officers who signs the Registration Statement and each Person, if any, who controls the Company within the meaning of the
1933 Act or the 1934 Act (each, an “Indemnified Party”), against any Claim or Indemnified Damages to which any of them
may become subject, under the 1933 Act, the 1934 Act or otherwise, insofar as such Claim or Indemnified Damages arise out of or are based
upon any Violation, in each case, to the extent, and only to the extent, that such Violation occurs in reliance upon and in conformity
with written information furnished to the Company by such Investor expressly for use in connection with such Registration Statement; and,
subject to Section 6(c) and the below provisos in this Section 6(b), such Investor will reimburse an Indemnified Party any legal
or other expenses reasonably incurred by such Indemnified Party in connection with investigating or defending any such Claim; provided,
however, the indemnity agreement contained in this Section 6(b) and the agreement with respect to contribution contained in Section 7
shall not apply to amounts paid in settlement of any Claim if such settlement is effected without the prior written consent of such Investor,
which consent shall not be unreasonably withheld or delayed, provided further that such Investor shall be liable under this Section 6(b)
for only that amount of a Claim or Indemnified Damages as does not exceed the net proceeds to such Investor as a result of the applicable
sale of Registrable Securities pursuant to such Registration Statement. Such indemnity shall remain in full force and effect regardless
of any investigation made by or on behalf of such Indemnified Party and shall survive the transfer of any of the Registrable Securities
by any of the Investors pursuant to Section 9.
(c) Promptly
after receipt by an Indemnified Person or Indemnified Party (as the case may be) under this Section 6 of notice of the commencement
of any action or proceeding (including, without limitation, any governmental action or proceeding) involving a Claim, such Indemnified
Person or Indemnified Party (as the case may be) shall, if a Claim in respect thereof is to be made against any indemnifying party under
this Section 6, deliver to the indemnifying party a written notice of the commencement thereof, and the indemnifying party shall
have the right to participate in, and, to the extent the indemnifying party so desires, jointly with any other indemnifying party similarly
noticed, to assume control of the defense thereof with counsel mutually satisfactory to the indemnifying party and the Indemnified Person
or the Indemnified Party (as the case may be); provided, however, an Indemnified Person or Indemnified Party (as the case may be) shall
have the right to retain its own counsel with the fees and expenses of such counsel to be paid by the indemnifying party if: (i) the indemnifying
party has agreed in writing to pay such fees and expenses; (ii) the indemnifying party shall have failed promptly to assume the defense
of such Claim and to employ counsel reasonably satisfactory to such Indemnified Person or Indemnified Party (as the case may be) in any
such Claim; or (iii) the named parties to any such Claim (including, without limitation, any impleaded parties) include both such Indemnified
Person or Indemnified Party (as the case may be) and the indemnifying party, and such Indemnified Person or such Indemnified Party (as
the case may be) shall have been advised by counsel that a conflict of interest is likely to exist if the same counsel were to represent
such Indemnified Person or such Indemnified Party and the indemnifying party (in which case, if such Indemnified Person or such Indemnified
Party (as the case may be) notifies the indemnifying party in writing that it elects to employ separate counsel at the expense of the
indemnifying party, then the indemnifying party shall not have the right to assume the defense thereof and such counsel shall be at the
expense of the indemnifying party), provided further that in the case of clause (iii) above the indemnifying party shall not be responsible
for the reasonable fees and expenses of more than one (1) separate legal counsel for such Indemnified Person or Indemnified Party (as
the case may be). The Indemnified Party or Indemnified Person (as the case may be) shall reasonably cooperate with the indemnifying party
in connection with any negotiation or defense of any such action or Claim by the indemnifying party and shall furnish to the indemnifying
party all information reasonably available to the Indemnified Party or Indemnified Person (as the case may be) which relates to such action
or Claim. The indemnifying party shall keep the Indemnified Party or Indemnified Person (as the case may be) reasonably apprised at all
times as to the status of the defense or any settlement negotiations with respect thereto. No indemnifying party shall be liable for any
settlement of any action, claim or proceeding effected without its prior written consent; provided, however, the indemnifying party shall
not unreasonably withhold, delay or condition its consent. No indemnifying party shall, without the prior written consent of the Indemnified
Party or Indemnified Person (as the case may be), consent to entry of any judgment or enter into any settlement or other compromise which
does not include as an unconditional term thereof the giving by the claimant or plaintiff to such Indemnified Party or Indemnified Person
(as the case may be) of a release from all liability in respect to such Claim or litigation, and such settlement shall not include any
admission as to fault on the part of the Indemnified Party. Following indemnification as provided for hereunder, the indemnifying party
shall be subrogated to all rights of the Indemnified Party or Indemnified Person (as the case may be) with respect to all third parties,
firms or corporations relating to the matter for which indemnification has been made. The failure to deliver written notice to the indemnifying
party within a reasonable time of the commencement of any such action shall not relieve such indemnifying party of any liability to the
Indemnified Person or Indemnified Party (as the case may be) under this Section 6, except to the extent that the indemnifying party
is materially and adversely prejudiced in its ability to defend such action.
(d) The
indemnification required by this Section 6 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 Indemnified Damages are incurred.
(e) The
indemnity and contribution agreements contained herein shall be in addition to (i) any cause of action or similar right of the Indemnified
Party or Indemnified Person against the indemnifying party or others, and (ii) any liabilities the indemnifying party may be subject to
pursuant to the law.
7. Contribution.
To the extent any indemnification
by an indemnifying party is prohibited or limited by law, the indemnifying party agrees to make the maximum contribution with respect
to any amounts for which it would otherwise be liable under Section 6 to the fullest extent permitted by law; provided, however:
(i) no contribution shall be made under circumstances where the maker would not have been liable for indemnification under the fault standards
set forth in Section 6 of this Agreement, (ii) no Person involved in the sale of Registrable Securities which Person is guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the 1933 Act) in connection with such sale shall be entitled to contribution
from any Person involved in such sale of Registrable Securities who was not guilty of fraudulent misrepresentation; and (iii) contribution
by any seller of Registrable Securities shall be limited in amount to the amount of net proceeds received by such seller from the applicable
sale of such Registrable Securities pursuant to such Registration Statement. Notwithstanding the provisions of this Section 7, no
Investor shall be required to contribute, in the aggregate, any amount in excess of the amount by which the net proceeds actually received
by such Investor from the applicable sale of the Registrable Securities subject to the Claim exceeds the amount of any damages that such
Investor has otherwise been required to pay, or would otherwise be required to pay under Section 6(b), by reason of such untrue or
alleged untrue statement or omission or alleged omission.
8. Reports
Under the 1934 Act.
With a view to making available
to the Investors the benefits of Rule 144, the Company agrees to:
(a) make
and keep public information available, as those terms are understood and defined in Rule 144;
(b) file
with the SEC in a timely manner all reports and other documents required of the Company under the 1933 Act and the 1934 Act so long as
the Company remains subject to such requirements (it being understood and agreed that nothing herein shall limit any obligations of the
Company under the Securities Purchase Agreement) and the filing of such reports and other documents is required for the applicable provisions
of Rule 144; and
(c) furnish
to each Investor so long as such Investor owns Registrable Securities, promptly upon request, (i) a written statement by the Company,
if true, that it has complied with the reporting, submission and posting requirements of Rule 144, the 1933 Act and the 1934 Act, (ii)
a copy of the most recent annual or quarterly report of the Company and such other reports and documents so filed by the Company with
the SEC if such reports are not publicly available via EDGAR, and (iii) such other information as may be reasonably requested to
permit the Investors to sell such securities pursuant to Rule 144 without registration.
9. Assignment
of Registration Rights.
All or any portion of the
rights under this Agreement shall be automatically assignable by each Investor to any transferee or assignee (as the case may be) of all
or any portion of such Investor’s Registrable Securities or Preferred Shares if: (i) such Investor agrees in writing with such transferee
or assignee (as the case may be) to assign all or any portion of such rights, and a copy of such agreement is furnished to the Company
within a reasonable time after such transfer or assignment (as the case may be); (ii) the Company is, within a reasonable time after such
transfer or assignment (as the case may be), furnished with written notice of (a) the name and address of such transferee or assignee
(as the case may be), and (b) the securities with respect to which such registration rights are being transferred or assigned (as the
case may be); (iii) immediately following such transfer or assignment (as the case may be) the further disposition of such securities
by such transferee or assignee (as the case may be) is restricted under the 1933 Act or applicable state securities laws if so required;
(iv) at or before the time the Company receives the written notice contemplated by clause (ii) of this sentence such transferee or assignee
(as the case may be) agrees in writing with the Company to be bound by all of the provisions contained herein; (v) such transfer or assignment
(as the case may be) shall have been made in accordance with the applicable requirements of the Securities Purchase Agreement and the
Preferred Shares ;and (vi) such transfer or assignment (as the case may be) shall have been conducted in accordance with all applicable
federal and state securities laws.
10. Amendment
of Registration Rights.
Provisions of this Agreement
may be amended and the observance thereof may be waived (either generally or in a particular instance and either retroactively or prospectively),
only with the written consent of the Company and the Investor; Any amendment or waiver effected in accordance with this Section 10 shall
be binding upon Investor and the Company. No waiver shall be effective unless it is in writing and signed by an authorized representative
of the waiving party. No consideration shall be offered or paid to any Person to amend or consent to a waiver or modification of any provision
of this Agreement unless the same consideration (other than the reimbursement of legal fees) also is offered to all of the parties to
this Agreement.
11. Miscellaneous.
(a) Solely
for purposes of this Agreement, a Person is deemed to be a holder of Registrable Securities whenever such Person owns, or is deemed to
own, of record such Registrable Securities. If the Company receives conflicting instructions, notices or elections from two or more Persons
with respect to the same Registrable Securities, the Company shall act upon the basis of instructions, notice or election received from
such record owner of such Registrable Securities.
(b) Any
notices, consents, waivers or other communications required or permitted to be given under the terms of this Agreement must be in writing
and will be deemed to have been delivered: (i) upon receipt, when delivered personally; (ii) upon receipt, when sent by electronic mail
(provided that such sent email is kept on file (whether electronically or otherwise) by the sending party and the sending party does not
receive an automatically generated message from the recipient’s email server that such e-mail could not be delivered to such recipient);
or (iii) one (1) Business Day after deposit with an overnight courier service with next day delivery specified, in each case, properly
addressed to the party to receive the same. The mailing addresses and e-mail addresses for such communications shall be:
If to the Company:
Evofem Biosciences, Inc.
7770 Regents Road, Suite 113-618
San Diego, CA 92122
Telephone: (858) 550-1900
Attention: Chief Financial Officer
E-Mail: Izhang@evofem.com
With a copy (for informational purposes only) to:
Procopio Cory Hargreaves & Savitch, LLP
12544 High Bluff Drive
Suite 400
San Diego, CA 92130
Telephone: (858) 523-4305
E-Mail: paul.johnson@procopio.com
If to the Transfer Agent:
Pacific Stock Transfer
6725 Via Austi Pkwy, Suite 300
Las Vegas, NV 89119
Telephone: (702) 323-0033
Attention: Joslyn Claiborne
E-Mail: jclairborne@pacificstocktransfer.com
If to Investor:
[Aditxt, Inc.]
With a copy to:
Sheppard, Mullin Richter & Hampton LLP
30 Rockefeller Plaza
New York, NY 10112-0015
Telephone: 1-212-634-3073
Attention: John R. Hempill, Esq.
E-mail: JHempill@sheppardmullin.com
If to a Buyer, to its mailing address and/or email
address set forth on the Schedule of Buyers attached to the Securities Purchase Agreement, with copies to such Buyer’s representatives
as set forth on the Schedule of Buyers, or to such other mailing address and/or email address and/or to the attention of such other Person
as the recipient party has specified by written notice given to each other party five (5) days prior to the effectiveness of such change,
Written confirmation of receipt (A) given by the recipient of such notice, consent, waiver or other communication, (B) mechanically
or electronically generated by the sender’s e-mail containing the time, date and recipient’s e-mail or (C) provided by a courier
or overnight courier service shall be rebuttable evidence of personal service, receipt by e-mail or receipt from a nationally recognized
overnight delivery service in accordance with clause (i), (ii) or (iii) above, respectively.
(c) Failure
of any party to exercise any right or remedy under this Agreement or otherwise, or delay by a party in exercising such right or remedy,
shall not operate as a waiver thereof. The Company and each Investor acknowledge and agree that irreparable damage would occur in the
event that any of the provisions of this Agreement were not performed in accordance with their specific terms or were otherwise breached.
It is accordingly agreed that each party hereto shall be entitled to an injunction or injunctions to prevent or cure breaches of the provisions
of this Agreement by any other party hereto and to enforce specifically the terms and provisions hereof (without the necessity of showing
economic loss and without any bond or other security being required), this being in addition to any other remedy to which any party may
be entitled by law or equity.
(d) All
questions concerning the construction, validity, enforcement and interpretation of this Agreement shall be governed by the internal laws
of the State of New York, without giving effect to any choice of law or conflict of law provision or rule (whether of the State of New
York or any other jurisdictions) that would cause the application of the laws of any jurisdictions other than the State of New York. 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, and hereby irrevocably waives, and agrees not to assert in any suit, action or proceeding, any claim that it is not personally
subject to the jurisdiction of any such court, that such suit, action or proceeding is brought in an inconvenient forum or that the venue
of such suit, action or proceeding is improper. 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 to such party at the address for such 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 manner permitted by law. EACH PARTY HEREBY IRREVOCABLY WAIVES
ANY RIGHT IT MAY HAVE TO, AND AGREES NOT TO REQUEST, A JURY TRIAL FOR THE ADJUDICATION OF ANY DISPUTE HEREUNDER OR IN CONNECTION HEREWITH
OR ARISING OUT OF THIS AGREEMENT OR ANY TRANSACTION CONTEMPLATED HEREBY.
(e) If
any provision of this Agreement is prohibited by law or otherwise determined to be invalid or unenforceable by a court of competent jurisdiction,
the provision that would otherwise be prohibited, invalid or unenforceable shall be deemed amended to apply to the broadest extent that
it would be valid and enforceable, and the invalidity or unenforceability of such provision shall not affect the validity of the remaining
provisions of this Agreement so long as this Agreement as so modified continues to express, without material change, the original intentions
of the parties as to the subject matter hereof and the prohibited nature, invalidity or unenforceability of the provision(s) in question
does not substantially impair the respective expectations or reciprocal obligations of the parties or the practical realization of the
benefits that would otherwise be conferred upon the parties. The parties will endeavor in good faith negotiations to replace the prohibited,
invalid or unenforceable provision(s) with a valid provision(s), the effect of which comes as close as possible to that of the prohibited,
invalid or unenforceable provision(s).
(f) This
Agreement, the other Transaction Documents, the schedules and exhibits attached hereto and thereto and the instruments referenced herein
and therein constitute the entire agreement among the parties hereto and thereto solely with respect to the subject matter hereof and
thereof. There are no restrictions, promises, warranties or undertakings, other than those set forth or referred to herein and therein.
This Agreement, the other Transaction Documents, the schedules and exhibits attached hereto and thereto and the instruments referenced
herein and therein supersede all prior agreements and understandings among the parties hereto solely with respect to the subject matter
hereof and thereof; provided, however, nothing contained in this Agreement or any other Transaction Document shall (or shall be deemed
to) (i) have any effect on any agreements any Investor has entered into with the Company or any of its Subsidiaries prior to the date
hereof with respect to any prior investment made by such Investor in the Company, (ii) waive, alter, modify or amend in any respect any
obligations of the Company or any of its Subsidiaries or any rights of or benefits to any Investor or any other Person in any agreement
entered into prior to the date hereof between or among the Company and/or any of its Subsidiaries and any Investor and all such agreements
shall continue in full force and effect or (iii) limit any obligations of the Company under any of the other Transaction Documents.
(g) Subject
to compliance with Section 9 (if applicable), this Agreement shall inure to the benefit of and be binding upon the permitted successors
and assigns of each of the parties hereto. This Agreement is not for the benefit of, nor may any provision hereof be enforced by, any
Person, other than the parties hereto, their respective permitted successors and assigns and the Persons referred to in Sections 6
and 7 hereof.
(h) The
headings in this Agreement are for convenience of reference only and shall not limit or otherwise affect the meaning hereof. Unless the
context clearly indicates otherwise, each pronoun herein shall be deemed to include the masculine, feminine, neuter, singular and plural
forms thereof. The terms “including,” “includes,” “include” and words of like import shall be construed
broadly as if followed by the words “without limitation.” The terms “herein,” “hereunder,” “hereof”
and words of like import refer to this entire Agreement instead of just the provision in which they are found.
(i) This
Agreement may be executed in two or more identical counterparts, each of which shall be deemed an original, but all of which shall be
considered one and the same agreement and shall become effective when counterparts have been signed by each party and delivered to the
other party. In the event that any signature is delivered by an email which contains a portable document format (.pdf) file of an executed
signature page, such signature page 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 signature page were an original thereof.
(j) Each
party shall do and perform, or cause to be done and performed, all such further acts and things, and shall execute and deliver all such
other agreements, certificates, instruments and documents as any other party may reasonably request in order to carry out the intent and
accomplish the purposes of this Agreement and the consummation of the transactions contemplated hereby.
(k) The
language used in this Agreement will be deemed to be the language chosen by the parties to express their mutual intent and no rules of
strict construction will be applied against any party. Notwithstanding anything to the contrary set forth in Section 10, terms used in
this Agreement but defined in the other Transaction Documents shall have the meanings ascribed to such terms on the Closing Date in such
other Transaction Documents unless otherwise consented to in writing by each Investor.
(l) All
consents and other determinations required to be made by the Investor pursuant to this Agreement shall be made as determined as if all
of the outstanding Preferred Shares then held by the Investor have been converted for Registrable Securities without regard to any limitations
on redemption, amortization and/or conversion of the Preferred Shares.
(m) This
Agreement is intended for the benefit of the parties hereto and their respective permitted successors and assigns, and is not for the
benefit of, nor may any provision hereof be enforced by, any other Person.
[signature page follows]
IN WITNESS WHEREOF,
Buyer and the Company have caused their respective signature page to this Registration Rights Agreement to be duly executed as of the
date first written above.
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COMPANY: |
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EVOFEM BIOSCIENCES, INC. |
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By: |
/s/ Saundra Pelletier |
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Saundra Pelletier |
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Chief Executive Officer |
IN WITNESS WHEREOF,
Buyer and the Company have caused their respective signature page to this Registration Rights Agreement to be duly executed as of the
date first written above.
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BUYER: |
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aDITxt, iNC. |
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By: |
/s/ Amro Albanna |
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Name: |
Amro Albanna |
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Title: |
Chief Executive Officer |
EXHIBIT A
FORM OF NOTICE OF EFFECTIVENESS
OF REGISTRATION STATEMENT
______________________
______________________
______________________
Attention: _____________
Re: Evofem
Biosciences, Inc.
Ladies and Gentlemen:
[We are][I am] counsel to Evofem
Biosciences, Inc., a Delaware corporation (the “Company”), and have represented the Company in connection with that
certain Securities Purchase Agreement (the “Securities Purchase Agreement”) entered into by and among the Company and
the buyers named therein (collectively, the “Holders”) pursuant to which the Company issued to the Holders of Series
F-1 Convertible Preferred Stock (the “Preferred Shares”) convertible into the Company’s shares of common stock,
$0.0001 par value per share (the “Common Stock”).Pursuant to the Securities Purchase Agreement, the Company also has
entered into a Registration Rights Agreement with the Holders (the “Registration Rights Agreement”) pursuant to which
the Company agreed, among other things, to register the Registrable Securities (as defined in the Registration Rights Agreement), including
the shares of Common Stock issuable upon conversion of the Preferred Shares, under the Securities Act of 1933, as amended (the “1933
Act”). In connection with the Company’s obligations under the Registration Rights Agreement, on ____________ ___, 20__,
the Company filed a Registration Statement on Form [S-1][S-3] (File No. 333-_____________) (the “Registration Statement”)
with the Securities and Exchange Commission (the “SEC”) relating to the Registrable Securities which names each of
the Holders as a selling stockholder thereunder.
In connection with the foregoing,
[we][I] advise you that [a member of the SEC’s staff has advised [us][me] by telephone that [the SEC has entered an order declaring
the Registration Statement effective under the 1933 Act at [ENTER TIME OF EFFECTIVENESS] on [ENTER DATE OF EFFECTIVENESS]] [an order declaring
the Registration Statement effective under the 1933 Act at [ENTER TIME OF EFFECTIVENESS] on [ENTER DATE OF EFFECTIVENESS]] has been posted
on the web site of the SEC at www.sec.gov] and [we][I] have no knowledge, after a review of information posted on the website of the SEC
at http://www.sec.gov/litigation/stoporders.shtml, that any stop order suspending its effectiveness has been issued or that any proceedings
for that purpose are pending before, or threatened by, the SEC and the Registrable Securities are available for resale under the 1933
Act pursuant to the Registration Statement.
This letter shall serve as our
standing opinion to you that the shares of Common Stock underlying the Preferred Shares are freely transferable by the Holders pursuant
to the Registration Statement. You need not require further letters from us to effect any future legend-free issuance or reissuance of
such shares of Common Stock to the Holders as contemplated by the Company’s Irrevocable Transfer Agent Instructions dated _________
__, 20__.
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Very truly yours, |
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[ISSUER’S COUNSEL] |
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EXHIBIT B
SELLING STOCKHOLDERS
The shares of common stock
being offered by the selling stockholders are those issuable to the selling stockholders upon conversion of the preferred shares. For
additional information regarding the issuance of the preferred shares, see “Private Placement of Preferred Shares” above.
We are registering the shares of common stock in order to permit the selling stockholders to offer the shares for resale from time to
time.
The table below lists the
selling stockholders and other information regarding the beneficial ownership (as determined under Section 13(d) of the Securities Exchange
Act of 1934, as amended, and the rules and regulations thereunder) of the shares of common stock held by each of the selling stockholders.
The second column lists the number of shares of common stock beneficially owned by the selling stockholders, based on their respective
ownership of shares of common stock, preferred shares and warrants, as of ________, 20__, assuming conversion of the preferred shares
held by each such selling stockholder on that date but taking account of any limitations on conversion and exercise set forth therein.
The third column lists the
shares of common stock being offered by this prospectus by the selling stockholders and does not take in account any limitations on (i)
conversion of the preferred shares set forth therein or (ii) exercise of the warrants set forth therein.
In accordance with the terms
of a registration rights agreement with the holders of the preferred shares, this prospectus generally covers the resale of the sum of
(i) 150% of the maximum number of shares of common stock issued or issuable upon conversion of the preferred shares (assuming for purposes
hereof that the preferred shares are convertible at the alternate conversion price assuming an alternate conversion date as of the date
of filing of the registration statement this prospectus forms a part of determined as if the outstanding preferred shares were converted
in full (without regard to any limitations on conversion contained in the certificate of designations or any limitations on exercise contained
in the warrants, solely for the purpose of such calculation) at an alternate conversion price or exercise price (as the case may be) calculated
as of the trading day immediately preceding the date this registration statement was initially filed with the SEC. Because the conversion
price and alternate conversion price of the preferred shares may be adjusted, the number of shares that will actually be issued may be
more or less than the number of shares being offered by this prospectus. The fourth column assumes the sale of all of the shares offered
by the selling stockholders pursuant to this prospectus.
Under the terms of the preferred
shares, a selling stockholder may not convert the preferred shares to the extent (but only to the extent) such selling stockholder or
any of its affiliates would beneficially own a number of shares of our common stock which would exceed 4.99% of the outstanding shares
of the Company. The number of shares in the second column reflects these limitations. The selling stockholders may sell all, some or none
of their shares in this offering. See “Plan of Distribution.”
| Name of Selling Stockholder |
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Number of Shares of
Common Stock Owned
Prior to Offering |
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Maximum Number of Shares
of Common Stock to be Sold
Pursuant to this Prospectus |
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Number of Shares of
Common Stock of Owned
After Offering |
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PLAN OF DISTRIBUTION
We are registering the shares
of common stock issuable upon conversion of the preferred shares to permit the resale of these shares of common stock by the holders of
the preferred shares from time to time after the date of this prospectus. We will not receive any of the proceeds from the sale by the
selling stockholders of the shares of common stock.. We will bear all fees and expenses incident to our obligation to register the shares
of common stock.
The selling stockholders may
sell all or a portion of the shares of common stock held by them and offered hereby from time to time directly or through one or more
underwriters, broker-dealers or agents. If the shares of common stock are sold through underwriters or broker-dealers, the selling stockholders
will be responsible for underwriting discounts or commissions or agent’s commissions. The shares of common stock may be sold in
one or more transactions at fixed prices, at prevailing market prices at the time of the sale, at varying prices determined at the time
of sale or at negotiated prices. These sales may be effected in transactions, which may involve crosses or block transactions, pursuant
to one or more of the following methods:
| ● | on any national securities exchange or quotation service on which the securities may be listed or quoted
at the time of sale; |
| ● | in the over-the-counter market; |
| ● | in transactions otherwise than on these exchanges or systems or in the over-the-counter market; |
| ● | through the writing or settlement of options, whether such options are listed on an options exchange or
otherwise; |
| ● | ordinary brokerage transactions and transactions in which the broker-dealer solicits purchasers; |
| ● | block trades in which the broker-dealer will attempt to sell the shares as agent but may position and
resell a portion of the block as principal to facilitate the transaction; |
| ● | purchases by a broker-dealer as principal and resale by the broker-dealer for its account; |
| ● | an exchange distribution in accordance with the rules of the applicable exchange; |
| ● | privately negotiated transactions; |
| ● | short sales made after the date the Registration Statement is declared effective by the SEC; |
| ● | broker-dealers may agree with a selling security holder to sell a specified number of such shares at a
stipulated price per share; |
| ● | a combination of any such methods of sale; and |
| ● | any other method permitted pursuant to applicable law. |
The selling stockholders may
also sell shares of common stock under Rule 144 promulgated under the Securities Act of 1933, as amended, if available, rather than
under this prospectus. In addition, the selling stockholders may transfer the shares of common stock by other means not described in this
prospectus. If the selling stockholders effect such transactions by selling shares of common stock to or through underwriters, broker-dealers
or agents, such underwriters, broker-dealers or agents may receive commissions in the form of discounts, concessions or commissions from
the selling stockholders or commissions from purchasers of the shares of common stock for whom they may act as agent or to whom they may
sell as principal (which discounts, concessions or commissions as to particular underwriters, broker-dealers or agents may be in excess
of those customary in the types of transactions involved). In connection with sales of the shares of common stock or otherwise, the selling
stockholders may enter into hedging transactions with broker-dealers, which may in turn engage in short sales of the shares of common
stock in the course of hedging in positions they assume. The selling stockholders may also sell shares of common stock short and deliver
shares of common stock covered by this prospectus to close out short positions and to return borrowed shares in connection with such short
sales. The selling stockholders may also loan or pledge shares of common stock to broker-dealers that in turn may sell such shares.
The selling stockholders may
pledge or grant a security interest in some or all of the preferred shares, warrants or shares of common stock owned by them and, if they
default in the performance of their secured obligations, the pledgees or secured parties may offer and sell the shares of common stock
from time to time pursuant to this prospectus or any amendment to this prospectus under Rule 424(b)(3) or other applicable provision of
the Securities Act amending, if necessary, the list of selling stockholders to include the pledgee, transferee or other successors in
interest as selling stockholders under this prospectus. The selling stockholders also may transfer and donate the shares of common stock
in other circumstances in which case the transferees, donees, pledgees or other successors in interest will be the selling beneficial
owners for purposes of this prospectus.
To the extent required by
the Securities Act and the rules and regulations thereunder, the selling stockholders and any broker-dealer participating in the distribution
of the shares of common stock may be deemed to be “underwriters” within the meaning of the Securities Act, and any commission
paid, or any discounts or concessions allowed to, any such broker-dealer may be deemed to be underwriting commissions or discounts under
the Securities Act. At the time a particular offering of the shares of common stock is made, a prospectus supplement, if required, will
be distributed, which will set forth the aggregate amount of shares of common stock being offered and the terms of the offering, including
the name or names of any broker-dealers or agents, any discounts, commissions and other terms constituting compensation from the selling
stockholders and any discounts, commissions or concessions allowed or re-allowed or paid to broker-dealers.
Under the securities laws
of some states, the shares of common stock may be sold in such states only through registered or licensed brokers or dealers. In addition,
in some states the shares of common stock may not be sold unless such shares have been registered or qualified for sale in such state
or an exemption from registration or qualification is available and is complied with.
There can be no assurance
that any selling stockholder will sell any or all of the shares of common stock registered pursuant to the registration statement, of
which this prospectus forms a part.
The selling stockholders and
any other person participating in such distribution will be subject to applicable provisions of the Securities Exchange Act of 1934, as
amended, and the rules and regulations thereunder, including, without limitation, to the extent applicable, Regulation M of the Exchange
Act, which may limit the timing of purchases and sales of any of the shares of common stock by the selling stockholders and any other
participating person. To the extent applicable, Regulation M may also restrict the ability of any person engaged in the distribution of
the shares of common stock to engage in market-making activities with respect to the shares of common stock. All of the foregoing may
affect the marketability of the shares of common stock and the ability of any person or entity to engage in market-making activities with
respect to the shares of common stock.
We will pay all expenses of
the registration of the shares of common stock pursuant to the registration rights agreement, estimated to be $[ ]
in total, including, without limitation, Securities and Exchange Commission filing fees and expenses of compliance with state securities
or “blue sky” laws; provided, however, a selling stockholder will pay all underwriting discounts and selling commissions,
if any. We will indemnify the selling stockholders against liabilities, including some liabilities under the Securities Act in accordance
with the registration rights agreements or the selling stockholders will be entitled to contribution. We may be indemnified by the selling
stockholders against civil liabilities, including liabilities under the Securities Act that may arise from any written information furnished
to us by the selling stockholder specifically for use in this prospectus, in accordance with the related registration rights agreements
or we may be entitled to contribution.
Once sold under the registration
statement, of which this prospectus forms a part, the shares of common stock will be freely tradable in the hands of persons other than
our affiliates.
29
Exhibit 99.1
Aditxt and Evofem Amend and Restate Merger Agreement,
Targeting
September 30 Closing
Evofem Acquires SOLOSEC, an FDA-Approved Single-Dose
Treatment for Bacterial
Vaginosis and Trichomoniasis
Mountain View, CA July 17, 2024 Aditxt,
Inc. (“Aditxt”) (NASDAQ: ADTX), a company dedicated to discovering, developing, and deploying promising health innovations,
announces this past Friday, July 12th, Aditxt, its wholly owned subsidiary Adifem, Inc., and Evofem Biosciences, Inc.’s
(“Evofem”) (OTCQB: EVFM) amended and restated their Merger Agreement. This amended and restated Merger Agreement, among others,
addresses pre-closing issues critical for Evofem’s future success, including interim financing needs. The other revisions to the
Merger Agreement, alongside additional interim financing for Evofem, include substituting cash for Aditxt’s common stock as the
consideration for Evofem’s common stock in the merger and additional changes relating to it. Aditxt and Evofem are diligently working
to close the contemplated transaction in the second half of 2024.
The closing of the transaction between Aditxt and Evofem remains subject
to the successful satisfaction of a number of closing conditions, including, but not limited to, Aditxt securing sufficient financing
to fund its obligations at closing. No assurance can be given that all of the conditions to closing will be obtained or satisfied or that
the transaction will ultimately close.
Evofem recently announced the acquisition of SOLOSEC®
(secnidazole) 2g oral granules from Lupin Limited. Under the transaction terms, Lupin can receive a potential total consideration of up
to $84 million based on future contingent milestones.
“Aditxt and Evofem share
a common vision in recognizing and valuing innovations like SOLOSEC that need additional support to reach their full potential,”
said Saundra Pelletier, Chief Executive Officer of Evofem. “The expertise, focus, and tenacity of Evofem’s U.S. commercial organization
have enabled us to deliver consistent annual net sales growth for Phexxi since its launch. With the addition of Aditxt’s platform, we
believe can accelerate our growth trajectory and expand into a multi-product women’s health franchise. We are excited to harness these
strengths and leverage our physician relationships to re-launch and grow SOLOSEC, which offers an attractive ‘one-and-done’
oral dosing regimen for women with bacterial vaginosis and trichomoniasis.”
Amro Albanna, Co-Founder, Chairman, and CEO of
Aditxt, commented on this announcement, “The acquisition of SOLOSEC marks an important milestone in Evofem’s evolution. We
believe that SOLOSEC is a valuable asset that diversifies Evofem’s portfolio and has the potential to accelerate its evolution into
a dynamic global women’s health business that addresses significant health challenges. Our commitment to supporting the expansion
of Evofem’s portfolio with additional products and broadening its market reach domestically and internationally exemplifies how
the Aditxt model operates. Our confidence in Evofem’s potential has only strengthened, and we firmly believe that, if supported
by the right resources, they will drive significant advancements in women’s health.”
About Aditxt, Inc.
Aditxt, Inc.® (“Aditxt”) (NASDAQ: ADTX) is a social
innovation platform dedicated to discovering, developing, and deploying promising innovations. Aditxt’s ecosystem of research institutions,
industry partners, and shareholders collaboratively drives their mission to “Make Promising Innovations Possible Together.”
The social innovation platform is the cornerstone of Aditxt’s strategy, where multiple disciplines drive disruptive growth and address
significant societal challenges. Aditxt operates a unique model democratizing innovation, ensuring every stakeholder’s voice is
heard and valued, empowering collective progress.
Aditxt has a diverse innovation portfolio, including Adimune™,
Inc., which is leading the charge in developing a novel class of therapeutics for retraining the immune system to combat organ rejection,
autoimmunity, and allergies. Adivir™, Inc. focuses on enhancing population health, impacting public health globally, and Pearsanta™,
Inc. delivers rapid, personalized, and high-quality lab testing accessible anytime, anywhere, at their CLIA-certified and CAP-accredited
clinical laboratory based in Richmond, VA.
For more information see: www.aditxt.com
About SOLOSEC®
SOLOSEC® (secnidazole) 2 g
oral granules is the first and only single-dose oral prescription approved to treat both bacterial vaginosis (BV), a common vaginal infection,
in females 12 years of age, and trichomoniasis, a sexually transmitted infection, in people
12 years of age and older. Since trichomoniasis is a sexually transmitted infection, sexual
partners of infected patients should be treated with the same dose and at the same time to prevent reinfection. SOLOSEC is designed to
be easy to take, and one oral dose contains a complete course of treatment.1
Additional information
about SOLOSEC® can be found at www.SOLOSEC.com.
Forward-Looking Statements
Certain statements in this press release constitute
“forward-looking statements” within the meaning of federal securities laws. Forward-looking statements include statements
regarding the Company’s intentions, beliefs, projections, outlook, analyses or current expectations concerning, among other things,
the Company’s ongoing and planned product and business development; the Company’s ability to finance and execute on its strategic
M&A initiatives; the Company’s ability obtain the necessary funding and partner to commence clinical trials; the Company’s
intellectual property position; the Company’s ability to develop commercial functions; expectations regarding product launch and
revenue; the Company’s results of operations, cash needs, spending, financial condition, liquidity, prospects, growth and strategies;
the Company’s ability to raise additional capital; the industry in which the Company operates; and the trends that may affect the
industry or the Company. Forward-looking statements are not guarantees of future performance and actual results may differ materially
from those indicated by these forward-looking statements as a result of various important factors, as well as market and other conditions
and those risks more fully discussed in the section titled “Risk Factors” in the Company’s most recent Annual Report
on Form 10-K, as well as discussions of potential risks, uncertainties, and other important factors in the Company’s other filings
with the Securities and Exchange Commission. All such statements speak only as of the date made, and the Company undertakes no obligation
to update or revise publicly any forward-looking statements, whether as a result of new information, future events or otherwise, except
as required by law.
Media Relations Contact:
Mary O’ Brien
mobrien@aditxt.com
(516) 753-9933
-3-
Grafico Azioni Aditxt (NASDAQ:ADTX)
Storico
Da Ott 2024 a Nov 2024
Grafico Azioni Aditxt (NASDAQ:ADTX)
Storico
Da Nov 2023 a Nov 2024
