UNITED
STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Schedule 14A
Proxy
Statement Pursuant to Section 14(a) of the Securities Exchange Act of 1934
(Amendment No. )
| Filed by the Registrant |
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| Filed by a party other than the Registrant |
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Check
the appropriate box:
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Preliminary Proxy Statement |
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Confidential, for Use of
the Commission Only (as permitted by Rule 14a-6(e)(2)) |
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Definitive Proxy Statement |
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| ☐ |
Definitive Additional Materials |
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Soliciting Material under
§ 240.14a-12 |
Aditxt,
Inc.
(Name of Registrant as Specified In Its Charter)
(Name
of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment
of Filing Fee (Check all boxes that apply):
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No fee required |
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Fee paid previously with
preliminary materials. |
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Fee computed on table in
exhibit required by Item 25(b) per Exchange Act Rules 14a- 6(i)(1) and 0-11 |
2569
Wyandotte Street, Suite 101
Mountain View, CA 94043
December
[*], 2024
NOTICE
OF SPECIAL MEETING OF STOCKHOLDERS
To
Be Held on [*], 2025
Dear
Stockholder:
We
are pleased to invite you to attend the special meeting of stockholders (the “Special Meeting”) of Aditxt, Inc. (the “Company”),
which will be held on [*], 2025 at 12:00 PM ET.
The
Special Meeting will be held [in a virtual-only meeting format at [*]
In
addition to voting by submitting your proxy prior to the Special Meeting, you also will be able to vote your shares electronically during
the Special Meeting. Further details regarding the virtual meeting are included in the accompanying proxy statement. At the Special Meeting,
the holders of our outstanding common stock will act on the following matters:
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1. |
To approve, for the purpose
of Nasdaq Marketplace Rule 5635(d), the issuance of shares of common stock underlying shares of Series A-1 Convertible Preferred
Stock originally issued by the Company in December 2023 (the “Series A-1 Proposal”); |
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2. |
To approve, for the purpose
of Nasdaq Marketplace Rule 5635(d), the issuance of shares of common stock underlying shares of Series C-1 Convertible Preferred
Stock and common stock purchase warrants originally issued by the Company in May 2024 and August 2024 (the “Series C-1 Proposal”); |
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3. |
To approve, for the purpose
of Nasdaq Marketplace Rule 5635(d), the issuance of shares of common stock underlying common stock purchase warrants originally
issued by the Company in July 2024 (the “July Warrant Proposal”); |
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4. |
To authorize the adjournment
of the Special Meeting if necessary or appropriate, including to solicit additional proxies in the event that there are not sufficient
votes at the time of the Special Meeting or adjournment or postponement thereof to approve any of the foregoing proposals (the “Adjournment
Proposal”); and |
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5. |
To transact such other
matters as may properly come before the Special Meeting and any adjournment or postponement thereof. |
Our
board of directors has fixed [*], 202[*] as the record date (the “Record Date”) for the determination of stockholders entitled
to notice of, and to vote at, the Special Meeting and at any adjournment or postponement of the meeting.
IF
YOU PLAN TO ATTEND:
To
be admitted to the Special Meeting at you must have your control number available and follow the instructions found on your proxy card
or voting instruction form. You may vote during the Special Meeting by following the instructions available on the meeting website during
the meeting. Please allow sufficient time before the Special Meeting to complete the online check-in process. Your vote is very important.
If
you have any questions or need assistance voting your shares, please call Kingsdale Advisors at:
Strategic
Stockholder Advisor and Proxy Solicitation Agent
745 Fifth Avenue, 5th Floor, New York, NY 10151
North
American Toll Free Phone:
+1-866-851-3212
Email: contactus@kingsdaleadvisors.com
Call Collect Outside North America: +1-646-491-9096
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BY ORDER
OF THE BOARD OF DIRECTORS |
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| [*], 202[*] |
/s/ Amro Albanna |
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Amro Albanna
Chief Executive Officer and
Chairman of the Board of Directors |
Whether
or not you expect to attend the Special Meeting virtually, we urge you to vote your shares via proxy at your earliest convenience. This
will ensure the presence of a quorum at the Special Meeting. Promptly voting your shares will save the Company the expenses and extra
work of additional solicitation. Submitting your proxy now will not prevent you from voting your shares electronically at the Special
Meeting if you desire to do so, as your proxy is revocable at your option. Your vote is important, so please act today!
2569
Wyandotte St., Suite 101
Mountain View, CA 94043
PROXY
STATEMENT FOR THE
SPECIAL MEETING OF STOCKHOLDERS
To
be held on [*], 2025
The
board of directors of Aditxt, Inc. (“Aditxt” or the “Company”) is soliciting your proxy to vote at the Special
Meeting of Stockholders (the “Special Meeting”) to be held on [*], 2025, at 12:00 PM ET, in a virtual-only format online
by accessing [*] and at any adjournment thereof.
This
proxy statement contains information relating to the Special Meeting. This Special Meeting of stockholders will be held as a virtual
meeting. Stockholders attending the virtual meeting will be afforded the same rights and opportunities to participate as they would at
an in-person meeting.
You
will be able to attend and participate in the Special Meeting online via a live webcast by visiting [*]. In addition to voting
by submitting your proxy prior to the Special Meeting, you also will be able to vote your shares electronically during the Special Meeting.
Important
Notice Regarding the Availability of Proxy Materials
for the Special Meeting of Stockholders to be Held on [*], 2025:
The
Notice of Meeting, Proxy Statement, and 2023 Annual Report on Form 10-K are available at:
www.proxyvote.com |
ADITXT,
INC.
TABLE
OF CONTENTS
QUESTIONS
AND ANSWERS ABOUT THIS PROXY STATEMENT AND VOTING
What
is a proxy?
A
proxy is the legal designation of another person to vote the stock you own. That other person is called a proxy. If you designate someone
as your proxy in a written document, that document is also called a proxy or a proxy card. By completing, signing and returning the accompanying
proxy card, you are designating Amro Albanna, Chief Executive Officer, and Thomas J. Farley, Chief Financial Officer, as your proxies
for the Special Meeting and you are authorizing Mr. Albanna and Mr. Farley to vote your shares at the Special Meeting as you
have instructed on the proxy card. This way, your shares will be voted whether or not you attend the Special Meeting. Even if you plan
to attend the Special Meeting, we urge you to vote in one of the ways described below so that your vote will be counted even if you are
unable or decide not to attend the Special Meeting.
What
is a proxy statement?
A
proxy statement is a document that we are required by regulations of the U.S. Securities and Exchange Commission, or “SEC,”
to give you when we ask you to sign a proxy card designating Amro Albanna and Mr. Farley as proxies to vote on your behalf.
Why
did you send me this proxy statement?
We
sent you this proxy statement and proxy card because our board of directors is soliciting your proxy to vote at the Special Meeting and
any adjournment and postponement thereof. This proxy statement summarizes information related to your vote at the Special Meeting. All
stockholders who find it convenient to do so are cordially invited to attend the Special Meeting virtually. However, you do not need
to attend the meeting to vote your shares. Instead, you may simply complete, sign and return the proxy card or vote over the Internet,
by phone, or by fax.
What
Does it Mean if I Receive More than one set of proxy materials?
If
you receive more than one set of proxy materials, your shares may be registered in more than one name or in different accounts. Please
complete, sign, and return each proxy card to ensure that all of your shares are voted.
How
do I attend the Special Meeting?
The Special Meeting will be held
on [*], 2025, at 12:00 PM ET in a virtual format online by accessing [*]. Information on how to vote in person at the Special Meeting
is discussed below.
Who
is Entitled to Vote?
The
board of directors has fixed the close of business on [*], 202[*] as the record date (the “Record Date”) for the determination
of stockholders entitled to notice of, and to vote at, the Special Meeting or any adjournment or postponement thereof. On the Record
Date, there were [*] shares of common stock outstanding. Each share of common stock represents one vote that may be voted on each proposal
that may come before the Special Meeting.
What
is the Difference Between Holding Shares as a Record Holder and as a Beneficial Owner (Holding Shares in Street Name)?
If
your shares are registered in your name with our transfer agent, VStock Transfer, LLC, you are the “record holder” of those
shares. If you are a record holder, these proxy materials have been provided directly to you by the Company.
If
your shares are held in a stock brokerage account, a bank or other holder of record, you are considered the “beneficial owner”
of those shares held in “street name.” If your shares are held in street name, the Notice has been forwarded to you by that
organization. The organization holding your account is considered to be the stockholder of record for purposes of voting at the Special
Meeting. As the beneficial owner, you have the right to instruct this organization on how to vote your shares. See “How Will my
Shares be Voted if I Give No Specific Instruction?” below for information on how shares held in street name will be voted
without instructions provided.
Who
May Attend the Special Meeting?
Only
record holders and beneficial owners of our common stock, or their duly authorized proxies, may attend the Special Meeting. If your shares
of common stock are held in street name, you will need to provide a copy of a brokerage statement or other documentation reflecting your
stock ownership as of the Record Date.
What
am I Voting on?
There
are four (4) matters scheduled for a vote:
| 1. | To
approve, for the purpose of Nasdaq Marketplace Rule 5635(d), the issuance of shares
of common stock underlying shares of Series A-1 Convertible Preferred Stock originally issued
by the Company in December 2023 (the “Series A-1 Proposal”); |
| 2. | To
approve, for the purpose of Nasdaq Marketplace Rule 5635(d), the issuance of shares
of common stock underlying shares of Series C-1 Convertible Preferred Stock and common stock
purchase warrants originally issued by the Company in May 2024 and August 2024 (the “Series
C-1 Proposal”); |
| 3. | To
approve, for the purpose of Nasdaq Marketplace Rule 5635(d), the issuance of shares
of common stock underlying common stock purchase warrants originally issued by the Company
in July 2024 (the “July Warrant Proposal”); |
| 4. | To
authorize the adjournment of the Special Meeting if necessary or appropriate, including to
solicit additional proxies in the event that there are not sufficient votes at the time of
the Special Meeting or adjournment or postponement thereof to approve any of the foregoing
proposals; |
What
if another matter is properly brought before the Special Meeting?
The
board of directors knows of no other matters that will be presented for consideration at the Special Meeting. The proxies also have discretionary
authority to vote to adjourn the Special Meeting, including for the purpose of soliciting votes in accordance with our Board’s
recommendations. If any other matters are properly brought before the Special Meeting, it is the intention of the person named in the
accompanying proxy to vote on those matters in accordance with his best judgment.
How
Do I Vote?
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MAIL
Mailing your signed
proxy card or voter
instruction card to:
Vote Processing
c/o Broadridge
51 Mercedes Way
Edgewood, NY 11717 |
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INTERNET
Using the Internet at:
www.proxyvote.com |
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PHONE
1-800-690-6903 |
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ONLINE
AT THE MEETING
You can vote at the meeting at:
[*] |
Stockholders
of Record
If
you are a registered stockholder, you may vote by mail, fax, Internet, phone or online at the Special Meeting by following the instructions
in the Notice. You also may submit your proxy by mail by following the instructions included with your proxy card. The deadline for submitting
your proxy by Internet is 11:59 p.m. Eastern Time on [*], 202[*]. Our Board’s designated proxies, Mr. Albanna and Mr. Farley,
will vote your shares according to your instructions. If you attend the live webcast of the Special Meeting you also will be able to
vote your shares electronically at the meeting up until the time the polls are closed.
Beneficial
Owners of Shares Held in Street Name
If
you are a street name holder, your broker or nominee firm is the legal, registered owner of the shares, and it may provide you with the
Notice. Follow the instructions on the Notice to access our proxy materials and vote or to request a paper or email copy of our proxy
materials. The materials include a voting instruction card so that you can instruct your broker or nominee how to vote your shares. Please
check the Notice or voting instruction card or contact your broker or other nominee to determine whether you will be able to deliver
your voting instructions by Internet in advance of the meeting and whether, if you attend the live webcast of the Special Meeting, you
will be able to vote your shares electronically at the meeting up until the time the polls are closed.
All
shares entitled to vote and represented by a properly completed and executed proxy received before the Special Meeting and not revoked
will be voted at the Special Meeting as instructed in a proxy delivered before the Special Meeting. We provide Internet proxy voting
to allow you to vote your shares online, with procedures designed to ensure the authenticity and correctness of your proxy vote instructions.
However, please be aware that you must bear any costs associated with your Internet access, such as usage charges from Internet access
providers and telephone companies.
How
Many Votes do I Have?
Holders
of record of shares of our common stock will be entitled to one vote for each share of common stock held by them on the Record Date and
have the right to vote on all matters brought before the Special Meeting.
Is
My Vote Confidential?
Yes,
your vote is confidential. Only the inspector of elections, individuals who help with processing and counting your votes and persons
who need access for legal reasons will have access to your vote. This information will not be disclosed, except as required by law.
What
Constitutes a Quorum?
To
carry on business at the Special Meeting, we must have a quorum. A quorum is present when one-third of the shares entitled to vote, as
of the Record Date, are represented in person or by proxy. Thus, [*] shares must be represented in person or by proxy to have a quorum
at the Special Meeting. Your shares will be counted towards the quorum only if you submit a valid proxy (or one is submitted on your
behalf by your broker, bank or other nominee) or if you vote in person at the Special Meeting. Abstentions and broker non-votes will
be counted towards the quorum requirement. Shares owned by the Company are not considered outstanding or considered to be present at
the Special Meeting. If there is not a quorum at the Special Meeting, either the chairperson of the Special Meeting or our stockholders
entitled to vote at the Special Meeting may adjourn the Special Meeting.
How
Will my Shares be Voted if I Give No Specific Instruction?
We
must vote your shares as you have instructed. If there is a matter on which a stockholder of record has given no specific instruction
but has authorized us generally to vote the shares, they will be voted as follows:
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1. |
“For” for the
purpose of Nasdaq Marketplace Rule 5635(d), the issuance of shares of common stock underlying shares of Series A-1 Convertible
Preferred Stock originally issued by the Company in December 2023 (the “Series A-1 Proposal”); |
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2. |
“For” for the
purpose of Nasdaq Marketplace Rule 5635(d), the issuance of shares of common stock underlying shares of Series C-1 Convertible
Preferred Stock and common stock purchase warrants originally issued by the Company in May 2024 and August 2024 (the “Series
C-1 Proposal”); |
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3. |
”For”, for
the purpose of Nasdaq Marketplace Rule 5635(d), the issuance of shares of common stock underlying common stock purchase warrants
originally issued by the Company in July 2024 (the “July Warrant Proposal”); |
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4. |
“For” the authorization
to adjourn the Special Meeting if necessary or appropriate, including to solicit additional proxies in the event that there are not
sufficient votes at the time of the Special Meeting or adjournment or postponement thereof to approve any of the foregoing proposals. |
This
authorization would exist, for example, if a stockholder of record merely signs, dates and returns the proxy card but does not indicate
how its shares are to be voted on one or more proposals. If other matters properly come before the Special Meeting and you do not provide
specific voting instructions, your shares will be voted at the discretion of Amro Albanna and Thomas J. Farley, the board of directors’
designated proxies.
If
your shares are held in street name, see “What is a Broker Non-Vote?” below regarding the ability of banks, brokers and other
such holders of record to vote the uninstructed shares of their customers or other beneficial owners in their discretion.
How
are Votes Counted?
Votes
will be counted by the inspector of election appointed for the Special Meeting, who will separately count, for the election of directors,
“For,” “Withhold” and broker non-votes; and, with respect to the other proposals, votes “For” and
“Against,” abstentions and broker non-votes. Broker non-votes will not be included in the tabulation of the voting results
of any of the proposals and, therefore, will have no effect on such proposals.
What
is a Broker Non-Vote?
A
“broker non-vote” occurs when shares held by a broker in “street name” for a beneficial owner are not voted with
respect to a proposal because (1) the broker has not received voting instructions from the stockholder who beneficially owns the
shares and (2) the broker lacks the authority to vote the shares at their discretion.
Our
common stock is listed on the Nasdaq Capital Market. However, under current New York Stock Exchange (“NYSE”) rules and
interpretations that govern broker non-votes: (i) Proposal No. 1 for the approval of, for the purpose of Nasdaq Marketplace
Rule 5635(d), the issuance of shares of common stock underlying shares of Series A-1 Convertible Preferred Stock originally issued
by the Company in December 2023 (the “Series A-1 Proposal”) is considered a non-discretionary matter, and a broker will not
be permitted to exercise its discretion to vote uninstructed shares on the proposal; (ii) Proposal No. 2 for approval of, the
purpose of Nasdaq Marketplace Rule 5635(d), the issuance of shares of common stock underlying shares of Series C-1 Convertible Preferred
Stock and common stock purchase warrants originally issued by the Company in May 2024 and August 2024 (the “Series C-1 Proposal”) is
considered a non-discretionary matter, and a broker will not be permitted to exercise its discretion to vote uninstructed shares on the
proposal; (iii) Proposal No. 3 for the approval, for the purpose of Nasdaq Marketplace Rule 5635(d), the issuance of shares of common
stock underlying common stock purchase warrants originally issued by the Company in July 2024 (the “July Warrant Proposal”),
is considered a non-discretionary matter, and a broker will lack the authority to vote uninstructed shares at their discretion on such
proposal; and (iv) Proposal No. 4 for the authorization to adjourn the Special Meeting if necessary or appropriate, including
to solicit additional proxies in the event that there are not sufficient votes at the time of the Special Meeting or adjournment or postponement
thereof to approve any of the foregoing proposals is considered a non-discretionary matter, and a broker will not be permitted to exercise
its discretion to vote uninstructed shares on the proposal. Because NYSE rules apply to all brokers that are members of the NYSE, this
prohibition applies to the Special Meeting even though our common stock is listed on the Nasdaq Capital Market.
What
is an Abstention?
An
abstention is a stockholder’s affirmative choice to decline to vote on a proposal. Under Delaware law, abstentions are counted
as shares present and entitled to vote at the Special Meeting. Generally, unless provided otherwise by applicable law, our amended and
restated bylaws (the “Bylaws”) provide that an action of our stockholders (other than the election of directors) is approved
if a majority of the number of shares of stock entitled to vote thereon and present (either in person or by proxy) vote in favor of such
action. Therefore, abstentions will have no effect with respect to Proposals 1 through 4.
How
many votes are required to approve each proposal?
The
table below summarizes the proposals that will be voted on, the vote required to approve each item and how votes are counted:
| Proposal |
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Votes
Required |
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Voting
Options |
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Impact
of
“Withhold” or
“Abstain” Votes |
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Broker
Discretionary
Voting
Allowed |
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Proposal No. 1:
Approval of, for purposes of Nasdaq Rule 5635(d), the issuance of shares of common stock underlying shares of Series A-1 Convertible
Preferred Stock originally issued by the Company in December 2023 (the “Series A-1 Proposal”) |
|
The affirmative vote of the holders of a majority in
voting power of the votes cast affirmatively or negatively (excluding abstentions) at the Special Meeting by the holders entitled
to vote thereon. |
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“FOR” “AGAINST” “ABSTAIN” |
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None(1) |
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No(2) |
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Proposal No. 2:
Approval of, for purposes of Nasdaq Rule 5635(d), the issuance of shares of common stock underlying shares of Series C-1 Convertible
Preferred Stock and common stock purchase warrants originally issued by the Company in May 2024 and August 2024 (the “Series
C-1 Proposal”) |
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The affirmative vote of the holders of a majority in
voting power of the votes cast affirmatively or negatively (excluding abstentions) at the Special Meeting by the holders entitled
to vote thereon. |
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“FOR” “AGAINST” “ABSTAIN” |
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None(1) |
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No(2) |
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Proposal No. 3:
Approval of, for the purpose of Nasdaq Marketplace Rule 5635(d), the issuance of shares of common stock underlying common stock
purchase warrants originally issued by the Company in July 2024 (the “July Warrant Proposal”) |
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The affirmative vote of the holders of a majority in
voting power of the votes cast affirmatively or negatively (excluding abstentions) at the Special Meeting by the holders entitled
to vote thereon. |
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“FOR” “AGAINST” “ABSTAIN” |
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None(1) |
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No(2) |
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Proposal No. 4:
To authorize the adjournment of the Special Meeting if necessary or appropriate |
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The affirmative vote of the holders of a majority in
voting power of the votes cast affirmatively or negatively (excluding abstentions) at the Special Meeting by the holders entitled
to vote thereon. |
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“FOR” “AGAINST” “ABSTAIN” |
|
None(1) |
|
No(2) |
| (1) | A
vote marked as an “Abstention” is not considered a vote cast and will, therefore,
not affect the outcome of this proposal. |
| (2) | As
this proposal is not considered a discretionary matter, brokers lack authority to exercise
their discretion to vote uninstructed shares on this proposal. |
What
Are the Voting Procedures?
With
regard to all proposals, you may vote in favor of or against the proposal, or you may abstain from voting on the proposal. You should
specify your respective choices on the accompanying proxy card or your vote instruction form.
Is
My Proxy Revocable?
You
may revoke your proxy and reclaim your right to vote at any time before your proxy is voted by giving written notice to the Corporate
Secretary of the Company by delivering a properly completed, later-dated proxy card or vote instruction form or by voting in person at
the Special Meeting. All written notices of revocation and other communications with respect to revocations of proxies should be addressed
to: Aditxt, Inc., 2569 Wyandotte St., Suite 101, Mountain View, CA 94043. Attention: Corporate Secretary. Your most current proxy card
or Internet proxy is the one that will be counted.
Who
is Paying for the Expenses Involved in Preparing and Mailing this Proxy Statement?
All
of the expenses involved in preparing, assembling and mailing these proxy materials and all costs of soliciting proxies will be paid
by us. In addition to the solicitation by mail, proxies may be solicited by our officers and other employees by telephone or in person.
Such persons will receive no compensation for their services other than their regular salaries. Arrangements will also be made with brokerage
houses and other custodians, nominees and fiduciaries to forward solicitation materials to the beneficial owners of the shares held of
record by such persons, and we may reimburse such persons for reasonable out of pocket expenses incurred by them in forwarding solicitation
materials. We have retained Kingsdale Advisors as our strategic stockholder advisor and proxy solicitation agent in connection with the
solicitation of proxies for the Special Meeting. If you have any questions or require any assistance with completing your proxy, please
contact Kingsdale Advisors by telephone (toll-free within North America) at 1-866-851-3212 or (call collect outside North America)
at +1-646-491-9096 or by email at contactus@kingsdaleadvisors.com.
Do I
Have Dissenters’ Rights of Appraisal?
Stockholders
do not have appraisal rights under Delaware law or under the Company’s governing documents with respect to the matters to be voted
upon at the Special Meeting.
How
can I Find out the Results of the Voting at the Special Meeting?
Preliminary
voting results will be announced at the Special Meeting. In addition, final voting results will be disclosed in a Current Report on Form 8-K
that we expect to file with the SEC within four business days after the Special Meeting. If final voting results are not available
to us in time to file a Form 8-K with the SEC within four business days after the Special Meeting, we intend to file a Form 8-K
to publish preliminary results and, within four business days after the final results are known to us, file an amended Form 8-K
to publish the final results.
CERTAIN
RELATIONSHIPS AND RELATED TRANSACTIONS AND DIRECTOR INDEPENDENCE
Except
as described below and except for employment arrangements which are described under “executive compensation,” since January 1,
2018, there has not been, nor is there currently proposed, any transaction in which we are or were a participant, the amount involved
exceeds the lesser of $120,000 or 1% of the average of the total assets at December 31, 2023 and 2022, and any of our directors,
executive officers, holders of more than 5% of our common stock or any immediate family member of any of the foregoing had or will have
a direct or indirect material interest.
On
February 29, 2024, Amro Albanna, the Chief Executive Officer of the Company, and Shahrokh Shabahang, the Chief Innovation Officer of
the Company, loaned $117,000 and $115,000, respectively, to the Company. The loans were evidenced by an unsecured promissory note (the
“February 29th Notes”). Pursuant to the terms of the February 29th Notes, it will accrue interest at the Prime rate of eight
and one-half percent (8.5%) per annum and is due on the earlier of August 29, 2024 or an event of default, as defined therein. As of
September 30, 2024, these notes have an outstanding principal balance of $232,000. On September 9, 2024, the Company and Shahrokh Shabahang
entered into the first amendment to the February 29th Notes which extended the maturity date of the February 29th Notes to
January 31, 2025. On September 9, 2024 the Company and Amro Albanna entered into the first amendment to the unsecured promissory notes
(the “Albanna Amendment”), which extended the maturity date of the February 7th Note (as defined below), February 15th Note
(as defined below), and the February 29th Note to January 31, 2025 for each of the respective unsecured promissory notes.
On
February 15, 2024, Amro Albanna, the Chief Executive Officer of the Company loaned $205,000 to the Company. The loan was evidenced by
an unsecured promissory note (the “February 15th Note”). Pursuant to the terms of the February 15th Note, it will accrue
interest at the Prime rate of eight and one-half percent (8.5%) per annum and is due on the earlier of August 15, 2024 or an event of
default, as defined therein. The Albanna Amendment extended the maturity of the February 15th Note to January 31, 2025. As
of September 30, 2024 the note has an outstanding principal balance of $205,000.
On
February 7, 2024, Amro Albanna, the Chief Executive Officer of the Company loaned $30,000 to the Company. The loan was evidenced by an
unsecured promissory note (the “February 7th Note”). Pursuant to the terms of the February Note, it will accrue interest
at the Prime rate of eight and one-half percent (8.5%) per annum and is due on the earlier of August 7, 2024 or an event of default,
as defined therein. The Albanna Amendment extended the maturity of the
February 7th Note to January 31, 2025. As of September 30, 2024, the February 7th
Note has an outstanding principal balance of $30,000.
On
December 6, 2023, Amro Albanna, the Chief Executive Officer of the Company loaned $200,000 to the Company. The loan was evidenced by
an unsecured promissory note (the “December Note”). Pursuant to the terms of the December Note, it will accrue interest at
the Prime rate of eight and one-half percent (8.5%) per annum and is due on the earlier of June 6, 2024 or an event of default, as defined
therein. As of September 30, 2024, this note was fully paid off.
On
November 30, 2023, Amro Albanna, the Chief Executive Officer of the Company loaned $10,000 to the Company. The loan was evidenced by
an unsecured promissory note (the “November Note”). Pursuant to the terms of the November Note, it will accrue interest at
the Prime rate of eight and one-half percent (8.5%) per annum and is due on the earlier of May 30, 2024 or an event of default, as defined
therein. As of September 30, 2024, this note was fully paid off.
On
June 12, 2023, Amro Albanna, the Chief Executive Officer of the Company and Shahrokh Shabahang, the Chief Innovation Officer of the Company,
loaned $200,000 and $100,000, respectively, to the Company. The loans were evidenced by an unsecured promissory note (the “June
Notes”). Pursuant to the terms of the June Notes, each of the June Notes will accrue interest at the Prime rate of eight and one-quarter
percent (8.25%) per annum and is due on the earlier of December 12, 2023
or an event of default, as defined therein. As of September 30, 2024, this note was fully paid off.
On
April 21, 2023, Amro Albanna, the Chief Executive Officer of the Company, and Shahrokh Shabahang, the Chief Innovation Officer of the
Company, loaned $87,523 and $100,000, respectively, to the Company. The loans were each evidenced by an unsecured promissory note
(the “April Note”). Pursuant to the terms each April Note, it will accrue interest at the Prime rate of eight percent (8.00%)
per annum and is due on the earlier of October 21, 2023, or an event of default, as defined therein. As of September 30, 2023, the note
was fully paid off.
On
May 25, 2023, Amro Albanna, the Chief Executive Officer of the Company, loaned $200,000 to the Company. The loan was evidenced by
an unsecured promissory note (the “May Note”). Pursuant to the terms of the May Note, it will accrue interest at a rate of
eight and one-quarter percent (8.25%) per annum, the Prime rate on the date of signing, and is due on the earlier of November 25, 2023
or an event of default, as defined therein. As of September 30, 2023, the note was fully paid off.
On
June 12, 2023, Amro Albanna, the Chief Executive Officer of the Company, and Shahrokh Shabahang, the Chief Innovation Officer of the
Company, loaned $200,000 and $100,000, respectively, to the Company. The loans were evidenced by an unsecured promissory note (the
“June Note”). Pursuant to the terms of the June Note, it will accrue interest at the Prime rate of eight and one-quarter
percent (8.25%) per annum and is due on the earlier of December 12, 2023, or an event of default, as defined therein. As of September
30, 2023, the June Note was fully paid off.
On
July 11, 2023, we entered into a Subscription and Investment Representation Agreement (the “Subscription Agreement”) with
Amro Albanna, its Chief Executive Officer, who is an accredited investor (the “Purchaser”), pursuant to which the Company
agreed to issue and sell one (1) share of the Company’s Series C Preferred Stock, par value $0.001 per share (the “Preferred
Stock”), to the Purchaser for $1,000.00 in cash. The sale closed on July 11, 2023.
On
July 19, 2022, we entered into a Subscription and Investment Representation Agreement (the “Subscription Agreement”) with
Amro Albanna, its Chief Executive Officer, who is an accredited investor (the “Purchaser”), pursuant to which the Company
agreed to issue and sell one (1) share of the Company’s Series B Preferred Stock, par value $0.001 per share (the “Preferred
Stock”), to the Purchaser for $20,000.00 in cash. The sale closed on July 19, 2022. The one share of Series B Preferred Stock was
redeemed by the Company on Pctober 7, 2022 for $20,000 following the approval of the 2022 reverse stock split.
During
the years ended December 31, 2019 and 2018, Rowena Albanna, the wife of Amro Albanna, our Chief Executive Officer, provided
the Company with operations consulting services. In July 2020, Ms. Albanna joined the Company as its Chief Operating Officer. As
of December 31, 2018, $112,000 was accrued as compensation. An additional $180,000 was expensed as compensation during the year
ended December 31, 2019, and $17,000 was paid on the accrued balance. As of December 31, 2019, $275,000 remained accrued and
outstanding.
On
January 22, 2018, the Company issued an unsecured promissory note to Sekris for $40,000 that accrued interest of 4% annually. The
note was due on the earlier of July 22, 2018 or in the event of default, as defined in the agreement. This note has been repaid
as of December 31, 2019.
On
February 12, 2018, the Company issued an unsecured promissory note to Sekris for $50,000 that accrued interest of 4% annually. The
note was due on the earlier of August 12, 2018 or in the event of default, as defined in the agreement. This note has been repaid
as of December 31, 2019.
On
March 2, 2018, the Company issued an unsecured promissory note to Sekris for $10,000 that accrued interest of 4% annually. The note
was due on the earlier of September 2, 2018 or in the event of default, as defined in the agreement. This note has been repaid as
of December 31, 2019.
On
March 8, 2018, we entered into an Assignment Agreement (the “Assignment Agreement”) with Sekris. See “Summary — Overview — License
Agreement with Loma Linda University.” Dr. Shabahang, our Chief Innovative Officer, was the Chief Executive Officer of Sekris.
Sekris was subsequently dissolved in 2019.
On
March 8, 2018, we issued a warrant to purchase up to 10,000 shares of our common stock to Sekris. On March 2, 2018, we issued
a 4% unsecured promissory note to Sekris in the principal amount of $10,000. Principal and interest was due on September 2, 2018
or immediately upon an event of default. On February 12, 2018, we issued a 4% unsecured promissory note to Sekris in the principal
amount of $50,000. Principal and interest was due on August 12, 2018 or immediately upon an event of default. On January 22,
2018, we issued a 4% unsecured promissory note to Sekris in the principal amount of $40,000. Principal and interest was due on July 22,
2018 or immediately upon an event of default.
On
June 18, 2018, the Company issued an unsecured promissory note to Sekris for $17,502 that accrued interest of 4% annually. The note
was due on the earlier of December 18, 2018 or in the event of default, as defined in the agreement. This note has been repaid as
of December 31, 2019.
On
January 1, 2019, we entered into a consulting agreement with Rowena Albanna, the wife of Amro Albanna, our Chief Executive Officer,
to perform operations consulting services. As part of this agreement, we pay Ms. Albanna $15,000 per month for her services. This agreement
terminated on June 30, 2020. In July 2020, Ms. Albanna joined the Company as its Chief Operating Officer.
On
March 21, 2019, we issued a promissory note to Dr. Shabahang, our Chief Innovative Officer. The note has a principal amount
of $10,000, was due on September 21, 2019, and bears an interest rate of 4% per year. This note remains outstanding.
During
the year ended December 31, 2019, we assumed an aggregate of $189,625 of liabilities from Sekris in exchange for the return of 94,813
shares of our common stock.
On
January 20, 2020, we issued a promissory note to Brian Brady, a member of our board of directors. The note has a principal amount
of $50,000, was due on the earlier of April 19, 2020 or within 10 days of the closing of our initial public offering. This
note carried an original issue discount of $25,000. The note was amended on April 23, 2020 to extend the maturity date to the earlier
of June 30, 2020 or within 10 days of the closing of our initial public offering. This note was repaid in July 2020.
In
July 2020, we issued units of securities to the related parties listed below in conversion of their outstanding accrued compensation
through March 31, 2020. The units were the same type and form of the units offered in the IPO.
| ● | 762 units
to Amro Albanna, our Chairman and Chief Executive Officer, in conversion of $342,500 in accrued
compensation through March 31, 2020; |
| ● | 945 units
to Shahrokh Shabahang, D.D.S., MS, Ph.D., our Chief Innovation Officer and Director, in conversion
of $425,000 in accrued compensation through March 31, 2020; and |
| ● | 712 units
to Rowena Albanna, the wife of our Chief Executive Officer and an independent contractor
providing services to the Company, in conversion of $320,000 in accrued compensation through
March 31, 2020. In July 2020, Ms. Albanna joined the Company as its Chief Operating
Officer. |
Review,
Approval and Ratification of Related Party Transactions
Given
our small size and limited financial resources, we have not adopted formal policies and procedures for the review, approval or ratification
of transactions, such as those described above, with our executive officer(s), Director(s) and significant stockholders. We intend
to establish formal policies and procedures in the future, once we have sufficient resources and have appointed additional Directors,
so that such transactions will be subject to the review, approval or ratification of our Board of Directors, or an appropriate committee
thereof. On a moving forward basis, our Directors will continue to approve any related party transaction.
PROPOSAL
NO. 1:
THE
SERIES A-1 PROPOSAL
Background
On
December 22, 2023, we entered into an Exchange Agreement (the “Exchange Agreement”) with the holders (the “Holders”)
of an aggregate of 22,280 shares of Series F-1 Convertible Preferred Stock of Evofem Biosciences, Inc. (the “Evofem Series F-1
Preferred Stock”), pursuant to which the Holders agreed to exchange their respective shares of Evofem Series F-1 Preferred Stock
for an aggregate of 22,280 shares of a new series of convertible preferred stock of the Company designated as Series A-1 Convertible
Preferred Stock, $0.001 par value, (the “Series A-1 Preferred Stock”).
The
Exchange Agreement requires that we call and hold a meeting of our stockholders for the purpose of requesting approval of (i) the an
increase of the authorized shares of common stock of the Company from 100,000,000 to 1,000,000,000 (the “Increase in Authorized”)
and/or a reverse stock split of the issued and outstanding shares of common stock of the Company resulting in a similar impact on the
Company’s authorized but unissued shares of common stock and (ii) the approval of any matters requiring stockholder approval pursuant
to the listing requirements of the Nasdaq Capital Market including, without limitation the issuance of more than 20% of the outstanding
shares of Common Stock, in connection with the transaction.
Nasdaq
Listing Rule 5635(d) provides that stockholder approval is required prior to the issuance of securities in a transaction, other
than a public offering, involving the sale, issuance or potential issuance by the Company of common stock (or securities convertible
into or exercisable for common stock), which equals 20% or more of the common stock or 20% or more of the voting power outstanding before
the issuance, at a price less than the lower of: (i) the closing price immediately preceding the signing of the binding agreement,
or (ii) the average closing price of the common stock for the five trading days immediately preceding the signing of the binding
agreement for the transaction. See “— Reasons for Stockholder Approval” below.
In
light of this rule, the Certificate of Designations of the Series A-1 Preferred Stock provides that, unless we obtain the approval of
our stockholders as required by Nasdaq, the Company is prohibited from issuing any shares of common stock pursuant to the terms of the
Series A-1 Preferred Stock, if (i) the issuance of such shares of common stock upon conversion of the Series A-1 Preferred Stock
would exceed 19.99% of the Company’s outstanding shares of common stock as of December 22, 2023, or, (ii) if such issuance
would otherwise exceed the aggregate number of shares of common stock which the Company may issue without breaching its obligations under
the rules and regulations of Nasdaq.
Accordingly,
at the Annual Meeting, stockholders will vote on the approval of the issuance of securities in the transaction contemplated by the Exchange
Agreement and the Series A-1 Preferred Stock, including the shares of common stock issuable upon conversion of the Series A-1 Preferred
Stock.
The
following is a summary of the material features of the Series A-1 Preferred Stock. This summary is qualified in its entirety by the full
text of the Certificate of Designations of the Series A-1 Preferred Stock, a copy of which is attached to this Proxy Statement as Appendix
A.
The
Series A-1 Preferred Stock
Designation,
Amount, and Par Value. The number of Series A-1 Preferred Stock designated is 22,280 shares. The shares of Series A-1 Preferred
Stock have a par value of $0.001 per share and a stated value of $1,000 per share.
Conversion
Price. The Series A-1 Preferred Stock will be convertible into shares of Common Stock at an initial conversion price of $177.60
(subject to adjustment pursuant to the Series A-1 Certificate of Designations) (the “Conversion Price”). The
Certificate of Designations also provides that in the event of certain Triggering Events (as defined below) any holder may, at any time,
convert any or all of such holder’s Series A-1 Preferred Stock at an alternate conversion rate equal to the product of (i) the
Alternate Conversion Price (as defined below) and (ii) the quotient of (x) the 25% redemption premium multiplied by (y) the amount of
Series A-1 Preferred Stock subject to such conversion. “Triggering Events” include, among others, (i) a suspension of trading
or the failure to be traded or listed on an eligible market for five consecutive days or more, (ii) the failure to remove restrictive
legends when required, (iii) the Company’s default in payment of indebtedness in an aggregate amount of $500,000 or more, (iv)
proceedings for a bankruptcy, insolvency, reorganization or liquidation, which are not dismissed with 30 days, (v) commencement of a
voluntary bankruptcy proceeding, and (viii) final judgments against the Company for the payment of money in excess of $100,000. “Alternate
Conversion Price” means the lowest of (i) the applicable conversion price the in effect, (ii) the greater of (x) $35.52 (the “Floor
Price”) and (y) 80% of the volume weighted average price (“VWAP”) of the Common Stock on the trading day immediately
preceding the delivery of the applicable conversion notice. Further, the Series A-1 Certificate of Designations provides that if on any
of the 90th and 180th day after each of the occurrence of any Stock Combination Event (as defined in the Series
A-1 Certificate of Designations) and the Applicable Date (as defined in the Series A-1 Certificate of Designations), the conversion price
then in effect is greater than the market price then in effect (the “Adjustment Price”), on such date then the conversion
price shall automatically lower to the Adjustment Price.
Dividends.
Holders of the Series A-1 Preferred Stock shall be entitled to receive dividends when and as declared by the Board, from time to time,
in its sole discretion, which Dividends shall be paid by the Company out of funds legally available therefor, payable, subject to the
conditions and other terms hereof, in cash, in securities of the Company or any other entity, or using assets as determined by the Board
on the Stated Value of such Preferred Share.
Liquidation. In
the event of a Liquidation Event (as defined in the Series A-1 Certificate of Designation), the holders the Series A-1 Preferred Stock
shall be entitled to receive in cash out of the assets of the Company, before any amount shall be paid to the holders of any other shares
of capital stock of the Company, equal to the greater of (A) 125% of the Conversion Amount (as defined in the Series A-1 Certificate
of Designation) on the date of such payment and (B) the amount per share such holder of Series A-1 Preferred Stock would receive if they
converted such share of Series A-1 Preferred Stock into Common Stock immediately prior to the date of such payment
Company
Redemption. The Company may redeem all, or any portion, of the Series A-1 Preferred Stock for cash, at a price per share
of Series A-1 Preferred Stock equal to 115% of the greater of (i) the Conversion Amount (as defined in the Series A-1 Certificate of
Designation)being redeemed as of the Company Optional Redemption Date (as defined in the Series A-1 Certificate of Designation) and (ii)
the product of (1) the Conversion Rate (as defined in the Series A-1 Certificate of Designation) with respect to the Conversion Amount
being redeemed as of the Company Optional Redemption Date multiplied by (2) the greatest Closing Sale Price (as defined in the Certificate
of Designation) of the Common stock on any Trading Day during the period commencing on the date immediately preceding such Company Optional
Redemption Notice Date (as defined in the Certificate of Designation) and ending on the Trading Day immediately prior to the date the
Company makes the entire payment required to be made under the Certification of Designation.
Maximum
Percentage. Holders of Series A-1 Preferred Stock are prohibited from converting shares of Series A-1 Preferred Stock into shares
of Common Stock if, as a result of such conversion, such holder, together with its affiliates, would beneficially own in excess of 4.99%
(the “Maximum Percentage”) of the total number of shares of Common Stock issued and outstanding immediately after giving
effect to such conversion.
Voting
Rights. The holders of the Series A-1 Preferred Stock shall have no voting power and no right to vote on any matter at any
time, either as a separate series or class or together with any other series or class of share of capital stock, and shall not be entitled
to call a meeting of such holders for any purpose nor shall they be entitled to participate in any meeting of the holders of Common Stock,
except as expressly provided in the Certificate of Designations and where required by the DGCL.
Effect
on Current Stockholders
The
issuance of shares of common stock upon conversion of the Series A-1 Preferred Stock will not affect the rights of the holders of outstanding
common stock, but such issuances will have a dilutive effect on the existing stockholders, including the voting power and economic rights
of the existing stockholders.
The
Certificate of Designations of Series A-1 Preferred Stock provides that the holder is prohibited from converting the Series A-1 Preferred
Stock to the extent the holder would beneficially own more than 4.99% of the Company’s outstanding shares of common stock after
such conversion.
Unlike
Nasdaq Rule 5635(d), which limits the aggregate number of shares the Company may issue to the holder of the Series A-1 Preferred
Stock, this beneficial ownership limitation limits the number of shares the holder may beneficially own at any one time. Consequently,
the number of shares the holder may beneficially own in compliance with the beneficial ownership limitation may increase over time as
the number of outstanding shares of common stock increases over time. In addition, the holder may sell some or all of the shares it receives
upon conversion of the Series A-1 Preferred Stock, permitting it to acquire additional shares in compliance with the beneficial ownership
limitation.
Description
of Common Stock
The
Company is currently authorized to issue 1,000,000,000 shares of common stock, par value $0.001, and 3,000,000 shares of preferred stock,
par value $0.001.
Common
Stock
Voting
The
holders of our common stock are entitled to one vote for each share held on all matters to be voted on by the Company’s stockholders.
There is no cumulative voting.
Liquidation
In
the event of any voluntary or involuntary liquidation, dissolution or winding up of our affairs, the holders of our common stock will
be entitled to share ratably in the net assets legally available for distribution to stockholders after the payment of or provision for
all of our debts and other liabilities.
Fully
Paid and Non-assessable
All
outstanding shares of common stock are duly authorized, validly issued, fully paid and non-assessable.
Dividends
The
Company has not paid any cash dividends on its common stock to date. Any future decisions regarding dividends will be made by its board
of directors. The Company does not anticipate paying dividends in the foreseeable future but expect to retain earnings to finance the
growth of its business. The Company’s board of directors has complete discretion on whether to pay dividends. Even if the Company’s
board of directors decides to pay dividends, the form, frequency and amount will depend upon the Company’s future operations and
earnings, capital requirements and surplus, general financial condition, contractual restrictions and other factors the board of directors
may deem relevant.
Market
The
Company’s common stock is traded on the Nasdaq Capital Market under the symbol “ADTX.”
Anti-Takeover
Provisions
Provisions
of the General Corporation Law of the State of Delaware (“DGCL”) and the Company’s Certificate of Incorporation and
Bylaws could make it more difficult to acquire the Company by means of a tender offer, a proxy contest or otherwise, or to remove incumbent
officers and directors. These provisions, summarized below, are expected to discourage certain types of coercive takeover practices and
takeover bids that the Company’s board of directors may consider inadequate and to encourage persons seeking to acquire control
of the Company to first negotiate with its board of directors. The Company believes that the benefits of increased protection of its
ability to negotiate with the proponent of an unfriendly or unsolicited proposal to acquire or restructure the Company outweigh the disadvantages
of discouraging takeover or acquisition proposals because, among other things, negotiation of these proposals could result in improved
terms for its stockholders.
Delaware
Anti-Takeover Statute. We may become subject to Section 203 of the DGCL, which prohibits persons deemed to be “interested
stockholders” from engaging in a “business combination” with a publicly-held Delaware corporation for three years
following the date these persons become interested stockholders unless the business combination is, or the transaction in which the person
became an interested stockholder was, approved in a prescribed manner or another prescribed exception applies. Generally, an “interested
stockholder” is a person who, together with affiliates and associates, owns, or within three years prior to the determination
of interested stockholder status did own, 15% or more of a corporation’s voting stock. Generally, a “business combination”
includes a merger, asset or stock sale, or other transaction resulting in a financial benefit to the interested stockholder. The existence
of this provision may have an anti-takeover effect with respect to transactions not approved in advance by the board of directors. A
Delaware corporation may “opt out” of these provisions with an express provision in its original certificate of incorporation
or an express provision in its certificate of incorporation or bylaws resulting from a stockholders’ amendment approved by at least
a majority of the outstanding voting shares. We have not opted out of these provisions. As a result, mergers or other takeover or change
in control attempts of us may be discouraged or prevented.
Vacancies
in the Board of Directors. Our Certificate of Incorporation and Bylaws provide that, subject to limitations, any vacancy occurring
in its board of directors for any reason may be filled by a majority of the remaining members of its board of directors then in office.
Each director elected to fill a vacancy resulting from the death, resignation or removal of a director shall hold office until the expiration
of the term of the director whose death, resignation or removal created the vacancy.
Advance
Notice of Nominations and Stockholder Proposals. Our Bylaws establish an advance notice procedure for stockholder proposals to be
brought before an annual meeting of our stockholders, including proposed nominations of persons for election to our board of directors.
At an annual meeting, stockholders may only consider proposals or nominations specified in the notice of meeting or brought before the
meeting by or at the direction of our board of directors. Stockholders may also consider a proposal or nomination by a person who was
a stockholder at the time of giving notice and at the time of the meeting, who is entitled to vote at the meeting and who has complied
with the notice requirements of our Bylaws in all respects. Our Bylaws do not give our board of directors the power to approve or disapprove
stockholder nominations of candidates or proposals regarding other business to be conducted at a special or annual meeting of our stockholders.
However, our Bylaws may have the effect of precluding the conduct of certain business at a meeting if the proper procedures are not followed.
These provisions may also discourage or deter a potential acquirer from conducting a solicitation of proxies to elect the acquirer’s
own slate of directors or otherwise attempting to obtain control of our company.
No
Cumulative Voting. The DGCL provides that stockholders are denied the right to cumulate votes in the election of directors unless
our Certificate of Incorporation provides otherwise. Our Certificate of Incorporation does not provide for cumulative voting.
Calling
of a Stockholder Meeting. Our Bylaws provide that a special meeting of our stockholders may be called only by our Chairman or by
resolution adopted by a majority of our board of directors. Because our stockholders do not have the right to call a special meeting,
a stockholder could not force stockholder consideration of a proposal over the opposition of our board of directors by calling a special
meeting of stockholders prior to such time as a majority of our board of directors, the chairperson of our board of directors, the president
or the chief executive officer believed the matter should be considered or until the next annual meeting provided that the requestor
met the notice requirements. The restriction on the ability of stockholders to call a special meeting means that a proposal to replace
our board of directors also could be delayed until the next annual meeting.
Exclusive
Forum. Our Certificate of Incorporation provides that unless the Company consents in writing to the selection of an alternative forum,
the State of Delaware is the sole and exclusive forum for: (i) any derivative action or proceeding brought on behalf of us, (ii) any
action asserting a claim of breach of a fiduciary duty owed by any of our directors, officers or other employees to us or our stockholders,
(iii) any action asserting a claim against the us, our directors, officers or employees arising pursuant to any provision of the
DGCL or our Certificate of Incorporation or the Bylaws, or (iv) any action asserting a claim against us, our directors, officers,
employees or agents governed by the internal affairs doctrine, except for, as to each of (i) through (iv) above, any claim
as to which the Court of Chancery determines that there is an indispensable party not subject to the jurisdiction of the Court of Chancery
(and the indispensable party does not consent to the personal jurisdiction of the Court of Chancery within ten days following such
determination), which is vested in the exclusive jurisdiction of a court or forum other than the Court of Chancery, or for which the
Court of Chancery does not have subject matter jurisdiction.
Additionally,
our Bylaws provide that unless we consent in writing to the selection of an alternative forum, the federal district courts of the United States
of America will be the exclusive forum for the resolution of any complaint asserting a cause of action arising under the Securities Act.
Any person or entity purchasing or otherwise acquiring any interest in shares of our capital stock are deemed to have notice of and consented
to this provision. The Supreme Court of Delaware has held that this type of exclusive federal forum provision is enforceable. There may
be uncertainty, however, as to whether courts of other jurisdictions would enforce such a provision, if applicable.
Reasons
for Stockholder Approval
Our
common stock is listed on The Nasdaq Capital Market, and, as such, we are subject to the Nasdaq Listing Rules. Nasdaq Listing Rule 5635(d) requires
stockholder approval prior to the issuance of securities in a transaction, other than a public offering, involving the sale, issuance
or potential issuance by us of common stock (or securities convertible into or exercisable for common stock), which equals 20% or more
of the common stock or 20% or more of the voting power outstanding before the issuance, at a price less than the lower of: (i) the
closing price immediately preceding the signing of the binding agreement, or (ii) the average closing price of the common stock
for the five trading days immediately preceding the signing of the binding agreement for the transaction.
The
board has determined that the ability to issue securities pursuant to the Certificate of Designations of the Series A-1 Preferred Stock
is in the best interests of the Company and its stockholders in order to comply with the terms of the Exchange Agreement and to receive
the benefits of the Series A-1 Preferred Stock upon conversion thereof.
Effect
of Failure to Obtain Stockholder Approval
Pursuant
to the Exchange Agreement we are obligated to cause stockholder meetings to be held until Stockholder Approval is obtained.
Effect
of Approval
Upon
obtaining Stockholder Approval requested in this proposal, we would no longer be bound by Nasdaq Listing Rule 5635(d)’s restriction
on the number or shares of common stock we are able to issue upon conversion of the Series A-1 Preferred Stock. As the conversion price
of the Series A-1 Preferred Stock could be adjusted downwards upon the occurrence of certain events in the future, we are unable to accurately
predict how many shares of common stock may be issuable upon full conversion of the Series A-1 Preferred Stock. As such, the additional
shares that the Company could issue to the holders of the Series A-1 Preferred Stock may result in significant dilution to existing stockholders,
a decline in our share price, or greater price volatility.
Each
additional common share that would be issuable to the holders of Series A-1 Preferred Stock would have the same rights and privileges
as each of our currently authorized common shares. See “— Description of Common Stock” above.
Interests
of Officers and Directors in this Proposal
Our
officers and directors do not have any substantial interest, direct or indirect, in in this proposal.
Required
Vote of Stockholders
The
affirmative vote of a majority of the votes cast at the Special Meeting is required to approve Proposal No. 1.
Board
Recommendation
The
board of directors unanimously recommends a vote “FOR” Proposal No. 1.
PROPOSAL
NO. 2:
THE
SERIES C-1 PROPOSAL
Background
On
May 2, 2024, we entered into a Securities Purchase Agreement with certain accredited investors,
pursuant to which we agreed to issue and sell to such investors in a private placement (i) an aggregate of 4,186 shares of the Company’s
Series C-1 Convertible Preferred Stock (the “Series C-1 Preferred Stock”), (ii) an aggregate of 4,186 shares of the Company’s
Series D-1 Preferred Stock (the “Series D-1 Preferred Stock”), and (iii) warrants (the “Warrants”) to purchase
up to an aggregate of 40,327 shares of the Company’s common stock.
The
Securities Purchase Agreement requires that we call and hold a meeting of our stockholders for the purpose of requesting approval of
(i) the an increase of the authorized shares of common stock of the Company from 100,000,000 to 1,000,000,000 (the “Increase in
Authorized”) and/or a reverse stock split of the issued and outstanding shares of common stock of the Company resulting in a similar
impact on the Company’s authorized but unissued shares of common stock and (ii) the approval of any matters requiring stockholder
approval pursuant to the listing requirements of the Nasdaq Capital Market including, without limitation the issuance of more than 20%
of the outstanding shares of Common Stock, in connection with the transaction.
Nasdaq
Listing Rule 5635(d) provides that stockholder approval is required prior to the issuance of securities in a transaction, other
than a public offering, involving the sale, issuance or potential issuance by the Company of common stock (or securities convertible
into or exercisable for common stock), which equals 20% or more of the common stock or 20% or more of the voting power outstanding before
the issuance, at a price less than the lower of: (i) the closing price immediately preceding the signing of the binding agreement,
or (ii) the average closing price of the common stock for the five trading days immediately preceding the signing of the binding
agreement for the transaction. See “— Reasons for Stockholder Approval” below.
In
light of this rule, the Certificate of Designations of the Series C-1 Preferred Stock provides that, unless we obtain the approval of
our stockholders as required by Nasdaq, the Company is prohibited from issuing any shares of common stock pursuant to the terms of the
Series C-1 Preferred Stock, if (i) the issuance of such shares of common stock upon conversion of the Series C-1 Preferred Stock
would exceed 19.99% of the Company’s outstanding shares of common stock as of May 2, 2024, or, (ii) if such issuance would
otherwise exceed the aggregate number of shares of common stock which the Company may issue without breaching its obligations under the
rules and regulations of Nasdaq.
Accordingly,
at the Annual Meeting, stockholders will vote on the approval of the issuance of securities in the transaction contemplated by the Securities
Purchase Agreement and the Series C-1 Preferred Stock, including the shares of common stock issuable upon conversion of the Series C-1
Preferred Stock.
The
following is a summary of the material features of the Series C-1 Preferred Stock. This summary is qualified in its entirety by the full
text of the Certificate of Designations of the Series C-1 Preferred Stock, a copy of which is attached to this Proxy Statement as Appendix
B.
The
Series C-1 Preferred Stock
Designation,
Amount, and Par Value. The number of Series C-1 Preferred Stock designated is 10,853 shares. The shares of Series C-1 Preferred
Stock have a par value of $0.001 per share and a stated value of $1,000 per share.
Conversion
Price. The Series C-1 Preferred Stock will be convertible into shares of Common Stock at an initial conversion price of $103.80
(subject to adjustment pursuant to the Series C-1 Certificate of Designations) (the “Conversion Price”). The
Certificate of Designations also provides that in the event of certain Triggering Events (as defined below) any holder may, at any time,
convert any or all of such holder’s Series C-1 Preferred Stock at an alternate conversion rate equal to the product of (i) the
Alternate Conversion Price (as defined below) and (ii) the quotient of (x) the 25% redemption premium multiplied by (y) the amount of
Series C-1 Preferred Stock subject to such conversion. “Triggering Events” include, among others, (i) a suspension of trading
or the failure to be traded or listed on an eligible market for five consecutive days or more, (ii) the failure to remove restrictive
legends when required, (iii) the Company’s default in payment of indebtedness in an aggregate amount of $500,000 or more, (iv)
proceedings for a bankruptcy, insolvency, reorganization or liquidation, which are not dismissed with 30 days, (v) commencement of a
voluntary bankruptcy proceeding, and (viii) final judgments against the Company for the payment of money in excess of $500,000. “Alternate
Conversion Price” means the lowest of (i) the applicable conversion price the in effect, (ii) the greater of (x) $20.76 (the “Floor
Price”) and (y) 80% of the volume weighted average price (“VWAP”) of the Common Stock on the trading day immediately
preceding the delivery of the applicable conversion notice. Further, the Series C-1 Certificate of Designations provides that if on any
of the 90th and 180th day after each of the occurrence of any Stock Combination Event (as defined in the Series C-1 Certificate
of Designations) and the Applicable Date (as defined in the Series C-1 Certificate of Designations), the conversion price then in effect
is greater than the market price then in effect (the “Adjustment Price”), on such date then the conversion price shall automatically
lower to the Adjustment Price.
Dividends.
Holders of the Series C-1 Preferred Stock shall be entitled to receive dividends when and as declared by the Board, from time to time,
in its sole discretion, which Dividends shall be paid by the Company out of funds legally available therefor, payable, subject to the
conditions and other terms hereof, in cash, in securities of the Company or any other entity, or using assets as determined by the Board
on the Stated Value of such Preferred Share.
Liquidation. In
the event of a Liquidation Event (as defined in the Series C-1 Certificate of Designation), the holders the Series C-1 Preferred Stock
shall be entitled to receive in cash out of the assets of the Company, before any amount shall be paid to the holders of any other shares
of capital stock of the Company, equal to the greater of (A) 125% of the Conversion Amount (as defined in the Series C-1 Certificate
of Designation) on the date of such payment and (B) the amount per share such holder of Series C-1 Preferred Stock would receive if they
converted such share of Series C-1 Preferred Stock into Common Stock immediately prior to the date of such payment
Company
Redemption. The Company may redeem all, or any portion, of the Series C-1 Preferred Stock for cash, at a price per share
of Series C-1 Preferred Stock equal to 115% of the greater of (i) the Conversion Amount (as defined in the Series C-1 Certificate of
Designations) being redeemed as of the Company Optional Redemption Date (as defined in the Series C-1 Certificate of Designation) and
(ii) the product of (1) the Conversion Rate (as defined in the Series C-1 Certificate of Designation) with respect to the Conversion
Amount being redeemed as of the Company Optional Redemption Date multiplied by (2) the greatest Closing Sale Price (as defined in the
Certificate of Designation) of the Common Stock on any Trading Day during the period commencing on the date immediately preceding such
Company Optional Redemption Notice Date (as defined in the Certificate of Designation) and ending on the Trading Day immediately prior
to the date the Company makes the entire payment required to be made under the Certification of Designation.
Maximum
Percentage. Holders of Series C-1 Preferred Stock are prohibited from converting shares of Series C-1 Preferred Stock into shares
of Common Stock if, as a result of such conversion, such holder, together with its affiliates, would beneficially own in excess of 4.99%
(the “Maximum Percentage”) of the total number of shares of Common Stock issued and outstanding immediately after giving
effect to such conversion.
Voting
Rights. The holders of the Series C-1 Preferred Stock shall have no voting power and no right to vote on any matter at any
time, either as a separate series or class or together with any other series or class of share of capital stock, and shall not be entitled
to call a meeting of such holders for any purpose nor shall they be entitled to participate in any meeting of the holders of Common Stock,
except as expressly provided in the Certificate of Designations and where required by the General Corporation Law of the State of Delaware
(the “DGCL”).
The
Warrants
The
following is a summary of the material features of the Warrants. The summary is qualified in its entirety by the full text of the Form
of Warrant, a copy of which is attached to this Proxy Statement as Appendix C.
The
Warrants are exercisable commencing six months following the initial issuance date at an initial exercise price of $2.47 per share and
expire five years from the date of issuance.
The
Company is prohibited from effecting an exercise of the Warrants to the extent that, as a result of such exercise, the holder of the
Warrant together with the holder’s affiliates, would beneficially own more than 4.99% of the number of shares of common stock of
the Company outstanding immediately after giving effect to the issuance of such shares.
Effect
on Current Stockholders
The
issuance of shares of common stock upon conversion of the Series C-1 Preferred Stock and exercise of the Warrants will not affect the
rights of the holders of outstanding common stock, but such issuances will have a dilutive effect on the existing stockholders, including
the voting power and economic rights of the existing stockholders.
The
Certificate of Designations of Series C-1 Preferred Stock and Warrant each provide that the holder is prohibited from converting the
Series C-1 Preferred Stock or exercising the Warrant to the extent the holder would beneficially own more than 4.99% of the Company’s
outstanding shares of common stock after such conversion or exercise.
Unlike
Nasdaq Rule 5635(d), which limits the aggregate number of shares the Company may issue to the holder of the Series C-1 Preferred
Stock or Warrant, this beneficial ownership limitation limits the number of shares the holder may beneficially own at any one time. Consequently,
the number of shares the holder may beneficially own in compliance with the beneficial ownership limitation may increase over time as
the number of outstanding shares of common stock increases over time. In addition, the holder may sell some or all of the shares it receives
upon conversion of the Series C-1 Preferred Stock or exercise of the Warrant, permitting it to acquire additional shares in compliance
with the beneficial ownership limitation.
Reasons
for Stockholder Approval
Our
common stock is listed on The Nasdaq Capital Market, and, as such, we are subject to the Nasdaq Marketplace Rules. Nasdaq Marketplace
Rule 5635(d) requires stockholder approval prior to the issuance of securities in a transaction, other than a public offering,
involving the sale, issuance or potential issuance by us of common stock (or securities convertible into or exercisable for common stock),
which equals 20% or more of the common stock or 20% or more of the voting power outstanding before the issuance, at a price less than
the lower of: (i) the closing price immediately preceding the signing of the binding agreement, or (ii) the average closing
price of the common stock for the five trading days immediately preceding the signing of the binding agreement for the transaction.
The
board has determined that the ability to issue securities pursuant to the Certificate of Designations of the Series C-1 Preferred Stock
and Warrant is in the best interests of the Company and its stockholders in order to comply with the terms of the Securities Purchase
Agreement and to receive the benefits of the Series C-1 Preferred Stock and Warrants upon conversion or exercise thereof.
Effect
of Failure to Obtain Stockholder Approval
Pursuant
to the Securities Purchase Agreement we are obligated to cause stockholder meetings to be held until stockholder approval is obtained.
Effect
of Approval
Upon
obtaining stockholder approval requested in this proposal, we would no longer be bound by Nasdaq Listing Rule 5635(d)’s restriction
on the number or shares of common stock we are able to issue upon conversion of the Series C-1 Preferred Stock or exercise of the Warrants.
Each
additional common share that would be issuable to the holders of Series C-1 Preferred Stock and Warrants would have the same rights and
privileges as each of our currently authorized common shares. See “— Description of Common Stock” under
Proposal No. 1 above.
Interests
of Officers and Directors in this Proposal
Our
officers and directors do not have any substantial interest, direct or indirect, in in this proposal.
Required
Vote of Stockholders
The
affirmative vote of a majority of the votes cast at the Special Meeting is required to approve Proposal No. 2.
Board
Recommendation
The
board of directors unanimously recommends a vote “FOR” Proposal No. 2.
PROPOSAL
NO. 3:
THE
JULY WARRANT PROPOSAL
Background
On
July 9, 2024, we entered into a securities purchase agreement (the “July Purchase Agreement”) with an accredited investor
pursuant to which we issued and sold a senior note in the principal amount of $625,000 maturing on October 7, 2024 (the “First
July Note”). In connection with the issuance of the First July Note, we also issued to the
investor a warrant to purchase up to 31,250 shares of our common stock (the “First July Warrant”). The First July Warrant
is exercisable, subject to adjustment, following Stockholder Approval (as defined in the July Purchase Agreement) at an initial exercise
price of $59.60 per share for a term of five years.
On
July 12, 2024, we entered into July Purchase Agreements with additional accredited investors pursuant to which we issued and sold senior
notes in the principal amount of $875,000 (the “Second July Notes” and together with the First July Note, the “July
Notes”). In connection with the issuance of the Second July Notes, we also issued warrants
to purchase up to 43,750 shares of our common stock (the “Second July Warrants” and together with the First July Warrant,
the “July Warrants”). The Second July Warrants are exercisable, subject to adjustment, following Stockholder Approval (as
defined in the July Purchase Agreement) at an initial exercise price of $63.28 per share for a term of five years.
The
foregoing is a summary of the material terms of the July Warrant. The summary is qualified in its entirety by the full text of the form
of July Warrant, a copy of which is attached to this Proxy Statement as Appendix D.
Effect
on Current Stockholders
The
issuance of shares of common stock upon exercise of the July Warrant will not affect the rights of the holders of outstanding common
stock, but such issuances will have a dilutive effect on the existing stockholders, including the voting power and economic rights of
the existing stockholders.
The
July Warrant provides that we may not issue or sell any shares of common stock to the holder of the July Warrant which, when aggregated
with all other shares of our common stock then beneficially owned by the holder of the July Warrant and its affiliates, would
result in the Investor beneficially owning more than 4.99% of the outstanding shares of our common stock.
Unlike
Nasdaq Rule 5635(d), which limits the aggregate number of shares the Company may issue to the holder of the July Warrant, this beneficial
ownership limitation limits the number of shares the Investor may beneficially own at any one time. Consequently, the number of shares
the holder of the July Warrant may beneficially own in compliance with the beneficial ownership limitation may increase over time as
the number of outstanding shares of common stock increases over time. In addition, the holder of the July Warrant may sell some or all
of the shares issued upon exercise of the July Warrant, permitting it to acquire additional shares in compliance with the beneficial
ownership limitation.
Reasons
for Stockholder Approval
Our
common stock is listed on The Nasdaq Capital Market, and, as such, we are subject to the Nasdaq Marketplace Rules. Nasdaq Marketplace
Rule 5635(d) requires stockholder approval prior to the issuance of securities in a transaction, other than a public offering,
involving the sale, issuance or potential issuance by us of common stock (or securities convertible into or exercisable for common stock),
which equals 20% or more of the common stock or 20% or more of the voting power outstanding before the issuance, at a price less than
the lower of: (i) the closing price immediately preceding the signing of the binding agreement, or (ii) the average closing
price of the common stock for the five trading days immediately preceding the signing of the binding agreement for the transaction.
The
board has determined that the ability to issue securities upon exercise of the July Warrant is in the best interests of the Company and
its stockholders in order to comply with the terms of the July Warrant and to receive the benefits of the July Warrant.
Effect
of Failure to Obtain Stockholder Approval
Pursuant
to the July Purchase Agreement we are obligated to cause stockholder meetings to be held until stockholder approval is obtained.
Effect
of Approval
Upon
obtaining stockholder approval requested in this proposal, we would no longer be bound by Nasdaq Listing Rule 5635(d)’s restriction
on the number or shares of common stock we are able to issue under the July Warrant.
Each
additional common share that would be issuable upon exercise of the July Warrant would have the same rights and privileges as each of
our currently authorized common shares. See “— Description of Common Stock” under Proposal No. 1 above.
Interests
of Officers and Directors in this Proposal
Our
officers and directors do not have any substantial interest, direct or indirect, in in this proposal.
Required
Vote of Stockholders
The
affirmative vote of a majority of the votes cast at the Special Meeting is required to approve Proposal No. 3.
Board
Recommendation
The
board of directors unanimously recommends a vote “FOR” Proposal No. 3.
PROPOSAL
NO. 4:
AUTHORIZATION
TO ADJOURN THE SPECIAL MEETING IF NECESSARY OR APPROPRIATE
At
the Special Meeting, we may ask our stockholders to vote on a proposal to adjourn the Special Meeting if necessary or appropriate in
the sole discretion of our Board of Directors, including to solicit additional proxies in the event that there are not sufficient votes
at the time of the Special Meeting or any adjournment or postponement of the Special Meeting to approve any of the other proposals.
If
at the Special Meeting the number of shares authorized to vote present or represented by proxy and voting in favor of a proposal is insufficient
to approve such proposal, then our Board of Directors may hold a vote on each proposal that has garnered sufficient votes, if any, and
then move to adjourn the Special Meeting as to the remaining proposals in order to solicit additional proxies in favor of those remaining
proposals.
Alternatively,
even if there are sufficient shares authorized to vote present or represented by proxy voting in favor of all of the proposals, our Board
of Directors may hold a vote on the adjournment proposal if, in its sole discretion, it determines that it is necessary or appropriate
for any reason to adjourn the Special Meeting to a later date and time. In that event, the Company will ask its stockholders to vote
only upon the adjournment proposal and not any other proposal.
Any
adjournment may be made without notice (if the adjournment is not for more than thirty days and a new record date is not fixed for
the adjourned meeting), other than by an announcement made at the Special Meeting of the time, date and place of the adjourned meeting.
Any
adjournment of the Special Meeting will allow our stockholders who have already sent in their proxies to revoke them at any time prior
to their use at the Special Meeting as adjourned.
If
we adjourn the Special Meeting to a later date, we will transact the same business and, unless we must fix a new record date, only the
stockholders who were eligible to vote at the original meeting will be permitted to vote at the adjourned meeting.
Required
Vote of Stockholders
The
affirmative vote of a majority of the votes cast at the Special Meeting is required to approve Proposal No. 4.
Board
Recommendation
The
board of directors recommends a vote “FOR” Proposal No. 4.
SECURITY
OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The
following table sets forth certain information regarding beneficial ownership of shares of our common stock as of the Record Date, based
on [*] shares issued and outstanding by (i) each person known to beneficially own more than 5% of our outstanding common stock,
(ii) each of our directors, (iii) our executive officers and (iv) all directors and executive officers as a group. Shares
are beneficially owned when an individual has voting and/or investment power over the shares or could obtain voting and/or investment
power over the shares within 60 days of the Record Date. Except as otherwise indicated, the persons named in the table have sole
voting and investment power with respect to all shares beneficially owned, subject to community property laws, where applicable. Unless
otherwise indicated, the address of each beneficial owner listed below is c/o Aditxt, Inc., 2569 Wyandotte Street, Suite 101, Mountain
View, CA 94043.
| | |
Number
of
shares of
Common
Stock
Beneficially
Owned | | |
Percentage | |
| Directors and Officers: | |
| | |
| |
| Amro Albanna(1) | |
| 255 | | |
| * | % |
| Shahrokh Shabahang, D.D.S.,
MS, Ph.D.(2) | |
| 198 | | |
| * | % |
| Corinne Pankovcin(3) | |
| 130 | | |
| * | % |
| Rowena Albanna(4) | |
| 127 | | |
| * | % |
| Brian Brady(5) | |
| 15 | | |
| * | % |
| Jeffrey Runge, M.D.(6) | |
| 15 | | |
| * | % |
| Thomas J. Farley(7) | |
| 123 | | |
| * | % |
| Charles Nelson(8) | |
| 19 | | |
| * | % |
| Sylvia Hermina | |
| * | | |
| * | |
| All directors and executive
officers as a group (9 persons) | |
| 882 | | |
| * | % |
| (1) | Includes
(i) 244 shares issuable pursuant to options that are fully vested; (ii) 6 shares beneficially
owned by the Albanna Family Trust, of which Mr. Albanna is the Trustee; (iii) 4 shares directly
owned by Mr. Albanna; and (iv) 1 Series A Warrant issued as part of the conversion of outstanding
accrued compensation through March 31, 2020. Mr. Albanna may be deemed to beneficially own
the securities held by his wife Rowena Albanna, the Company’s Chief Operating Officer. |
| (2) | Includes
(i) 179 shares issuable pursuant to options that are fully vested; (ii) warrants to purchase
4 shares, including 1 Series A Warrant issued as part of the conversion of outstanding accrued
compensation through March 31, 2020, and 3 warrants beneficially owned by the Shabahang-Hatami
Family Trust of which Shahrokh Shabahang, D.D.S., MS, Ph.D. is the Trustee; (iii) 15 shares
directly owned by Mr. Shabahang. |
| (3) | Includes
(i) 4 shares held directly by Ms. Pankovcin; and (ii) 126 shares issuable pursuant to options
that are fully vested. |
| (4) | Includes
(i) 3 shares held directly by Ms. Albanna; (ii) 123 shares issuable pursuant to options that
are fully vested; and (iii) 1 Series A Warrant issued as part of the conversion of outstanding
accrued compensation through March 31, 2020. Ms. Albanna may be deemed to beneficially own
the securities held by her husband Amro Albanna, the Company’s Chief Executive Officer. |
| (5) | Includes
(i) 2 shares held directly by Mr. Brady; and (ii) 13 shares issuable pursuant to options
that are fully vested. |
| (6) | Includes
(i) 1 share held by Biologue, Inc., over which Dr. Runge has voting and dispositive control;
(ii) 1 share held directly by Dr. Runge; and (iii) 13 shares issuable pursuant to options
that are fully vested. |
| (7) | Includes
(i) 4 shares held directly by Mr. Farley and (ii) 119 shares issuable pursuant to options
that are fully vested. |
| (8) | Includes
(i) 7 shares held by Siu Kim Athle International, LLC., over which Mr. Nelson has voting
and dispositive control and (ii) 12 shares issuable pursuant to options that are fully vested. |
OTHER
MATTERS
The
board of directors knows of no other business, which will be presented to the Special Meeting. If any other business is properly brought
before the Special Meeting, proxies will be voted in accordance with the judgment of the persons voting the proxies. The proxies also
have discretionary authority to vote to adjourn the Special Meeting, including for the purpose of soliciting votes in accordance with
our board of director’s recommendations.
We
will bear the cost of soliciting proxies in the accompanying form. In addition to the use of the mails, proxies may also be solicited
by our directors, officers or other employees, personally or by telephone, facsimile or email, none of whom will be compensated separately
for these solicitation activities. We have engaged Kingsdale Advisors to assist in the solicitation of proxies. We will pay a fee of
approximately $[*] plus reasonable out-of-pocket charges.
If
you do not plan to attend the Special Meeting, in order that your shares may be represented and in order to assure the required quorum,
please sign, date and return your proxy promptly. In the event you are able to attend the Special Meeting virtually, at your request,
we will cancel your previously submitted proxy.
HOUSEHOLDING
The
SEC has adopted rules that permit companies and intermediaries (e.g., brokers) to satisfy the delivery requirements for proxy statements
and other Special Meeting materials with respect to two or more stockholders sharing the same address by delivering a proxy statement
or other Special Meeting materials addressed to those stockholders. This process, which is commonly referred to as householding, potentially
provides extra convenience for stockholders and cost savings for companies. Stockholders who participate in householding will continue
to be able to access and receive separate proxy cards.
If
you share an address with another stockholder and have received multiple copies of our proxy materials, you may write or call us at the
address and phone number below to request delivery of a single copy of the notice and, if applicable, other proxy materials in the future.
We undertake to deliver promptly upon written or oral request a separate copy of the proxy materials, as requested, to a stockholder
at a shared address to which a single copy of the proxy materials was delivered. If you hold stock as a record stockholder and prefer
to receive separate copies of our proxy materials either now or in the future, please contact us at 2569 Wyandotte St., Suite 101, Mountain
View, CA 94043, Attn: Corporate Secretary. If your stock is held through a brokerage firm or bank and you prefer to receive separate
copies of our proxy materials either now or in the future, please contact your brokerage firm or bank.
ANNUAL
REPORT
Copies
of our Annual Report on Form 10-K for the fiscal year ended December 31, 2023 may be obtained without charge by writing to
the Company’s Secretary, Aditxt, Inc., 2569 Wyandotte St., Suite 101, Mountain View, CA 94043. The Notice, our Annual Report on
Form 10-K and this proxy statement are also available online at www.proxyvote.com.
| |
BY ORDER OF THE BOARD OF DIRECTORS |
| |
|
| [*], 2024 |
/s/ Amro Albanna |
| |
Amro Albanna |
| |
Chief Executive Officer and
Chairman of the Board of Directors |
APPENDIX
A
CERTIFICATE
OF DESIGNATIONS
OF RIGHTS AND PREFERENCES OF
SERIES A-1 CONVERTIBLE PREFERRED STOCK
OF
ADITXT, INC.
I,
Amro Albanna, hereby certify that I am the Chief Executive Officer and Chairman of Aditxt, Inc. (the “Company”), a
corporation organized and existing under the Chapter 78 of the Delaware General Corporation Law (the “DGCL”), and
further do hereby certify:
That
pursuant to the authority expressly conferred upon the Board of Directors of the Company (the “Board”) by the Company’s
Amended and Restated Certificate of Incorporation, as amended (the “Certificate of Incorporation”), and Section 151(g)
of the DGCL, the Board on December 7, 2023 adopted the following resolution determining it desirable and in the best interests of the
Company and its stockholders for the Company to create a series of Twenty Two Thousand, Two Hundred and Eighty (22,280) shares of preferred
stock designated as “Series A-1 Convertible Preferred Stock”, none of which shares have been issued, to be issued
pursuant to the Exchange Agreements (as defined in below), in accordance with the terms of the Exchange Agreements:
RESOLVED,
that pursuant to the authority vested in the Board, in accordance with the provisions of the Certificate of Incorporation, a series of
preferred stock, par value $0.001 per share, of the Company be and hereby is created pursuant to this certificate of designations (this
“Certificate of Designations”), and that the designation and number of shares established pursuant hereto and the
voting and other powers, preferences and relative, participating, optional or other rights of the shares of such series and the qualifications,
limitations and restrictions thereof are as follows:
TERMS
OF SERIES A-1 CONVERTIBLE PREFERRED STOCK
1.
Designation and Number of Shares. There shall hereby be created
and established a series of preferred stock of the Company designated as “Series A-1 Convertible Preferred Stock” (the “Series
A-1 Convertible Preferred Stock”). The authorized number of shares of Series A-1 Convertible Preferred Stock (the “Preferred
Shares”) shall be Two Thousand, Two Hundred and Eighty (22,280) shares. Each Preferred Share shall have a par value of $0.001
per share. Capitalized terms not defined herein shall have the meaning as set forth in Section 32 below.
2.
Ranking. Except (i) for shares of Senior Preferred Stock (as defined
below) to be issued to certain senior creditors of Evofem Biosciences, Inc. pursuant to the transactions contemplated by the Merger Agreement
(the “Merger Senior Preferred Stock”), shares of Parity Stock (as defined below) to be issued pursuant to (x) the
transactions contemplated by the Merger Agreement (as defined below) and (y) shares of Parity Stock to be issued pursuant to other acquisitions
or strategic transactions with a stated value of not more than $10 million in the aggregate on terms and conditions no more favorable
as those set forth herein (the “Merger Parity Stock”) or (ii) to the extent that the Required Holders (as defined
in the Exchange Agreements) expressly consent to the creation of Parity Stock (as defined below) or Senior Preferred Stock (as defined
below) in accordance with Section 16, all shares of capital stock of the Company shall be junior in rank to all Preferred Shares with
respect to the preferences as to dividends, distributions and payments upon the liquidation, dissolution and winding up of the Company
(such junior stock is referred to herein collectively as “Junior Stock”). For the avoidance of doubt, the Preferred
Shares will, with respect to dividend rights and rights on liquidation, winding-up and dissolution, rank (A) junior to the Merger Senior
Preferred Stock, (B) on parity with the Parity Stock and (C) senior to the Junior Stock. The rights of all such shares of capital stock
of the Company shall be subject to the rights, powers, preferences and privileges of the Preferred Shares. Without limiting any other
provision of this Certificate of Designations, without the prior express consent of the Required Holders, voting separately as a single
class, the Company shall not hereafter authorize or issue any additional or other shares of capital stock that is (i) of senior rank
to the Preferred Shares in respect of the preferences as to dividends, distributions and payments upon the liquidation, dissolution and
winding up of the Company (collectively, the “Senior Preferred Stock”), other than the Merger Senior Preferred Stock,
(ii) of pari passu rank to the Preferred Shares in respect of the preferences as to dividends, distributions and payments upon the liquidation,
dissolution and winding up of the Company (collectively, the “Parity Stock”), other than Parity Stock to be issued
pursuant to the transactions contemplated by the Merger Agreement and Merger Parity Stock or (iii) any Junior Stock having a maturity
date or any other date requiring redemption or repayment of such shares of Junior Stock that is prior to the first anniversary of the
Initial Issuance Date. In the event of the merger or consolidation of the Company with or into another corporation, the Preferred Shares
shall maintain their relative rights, powers, designations, privileges and preferences provided for herein and no such merger or consolidation
shall result inconsistent therewith.
3.
Dividends. In addition to Section 7, Section 8 and/or Section 15 below, as applicable, subject to the senior rights of the Senior
Preferred Stock, and pari passu with the holders of shares of Parity Stock, from and after the first date of issuance of any Preferred
Shares (the “Initial Issuance Date”), each holder of a Preferred Share (each, a “Holder” and collectively,
the “Holders”) shall be entitled to receive dividends (“Dividends”) when and as declared by the
Board, from time to time, in its sole discretion, which Dividends shall be paid by the Company out of funds legally available therefor,
payable, subject to the conditions and other terms hereof, in cash, in securities of the Company or any other entity, or using assets
as determined by the Board on the Stated Value of such Preferred Share.
4.
Conversion. At any time after the Initial Issuance Date, each
Preferred Share shall be convertible into validly issued, fully paid and non-assessable shares of Common Stock (the “Conversion
Shares”), on the terms and conditions set forth in this Section 4.
(a)
Holder’s Conversion Right. Subject to the provisions of Section 4(d), at any time or times on or after the Initial Issuance
Date, each Holder shall be entitled to convert any portion of the outstanding Preferred Shares held by such Holder into validly issued,
fully paid and non-assessable Conversion Shares in accordance with Section 4(c) at the Conversion Rate (as defined below). The Company
shall not issue any fraction of a share of Common Stock upon any conversion. If the issuance would result in the issuance of a fraction
of a share of Common Stock, the Company shall round such fraction of a share of Common Stock up to the nearest whole share. The Company
shall pay any and all transfer, stamp, issuance and similar taxes, costs and expenses (including, without limitation, fees and expenses
of the Company’s transfer agent (the “Transfer Agent”)) that may be payable with respect to the issuance and
delivery of Common Stock upon conversion of any Preferred Shares.
(b)
Conversion Rate. Except as otherwise provided herein, the number of Conversion Shares issuable upon conversion of any Preferred
Share pursuant to this Section 4 shall be determined by dividing (x) the Conversion Amount of such Preferred Share by (y) the Conversion
Price (the “Conversion Rate”).
For
purposes of this Certificate of Designations, the term “Conversion Amount” means, with respect to each Preferred Share,
as of the applicable date of determination, the sum of (1) the Stated Value thereof plus (2) any Additional Amount thereon as
of such date of determination plus (3) any other amounts owed to such Holder pursuant to this Certificate of Designations or any
Transaction Document.
For
purposes of this Certificate of Designations, the term “Conversion Price” means, with respect to each Preferred Share,
as of any Conversion Date or other date of determination, $4.44, subject to adjustment as provided herein.
(c)
Mechanics of Conversion. The conversion of each Preferred Share shall be conducted in the following manner:
(i)
Optional Conversion. To convert one or more Preferred Shares into
Conversion Shares on any date (a “Conversion Date”), a Holder shall deliver (whether via electronic mail or otherwise),
for receipt on or prior to 11:59 p.m., New York time, on such date, a copy of an executed notice of conversion of the Preferred Share(s)
subject to such conversion in the form attached hereto as Exhibit I (the “Conversion Notice”) to the
Company. If required by Section 4(c)(iii), within two (2) Trading Days following a conversion of any such Preferred Shares as aforesaid,
such Holder shall surrender to a nationally recognized overnight delivery service for delivery to the Company the original certificates,
if any, representing the Preferred Shares (the “Preferred Share Certificates”) so converted as aforesaid (or an indemnification
undertaking with respect to the Preferred Shares in the case of its loss, theft or destruction as contemplated by Section 18(b)). On
or before the first (1st) Trading Day following the date of receipt of a Conversion Notice, the Company shall transmit by
electronic mail an acknowledgment of confirmation and representation as to whether such shares of Common Stock may then be resold pursuant
to Rule 144 or an effective and available registration statement, in the form attached hereto as Exhibit II, of receipt
of such Conversion Notice to such Holder and the Transfer Agent, which confirmation shall constitute an instruction to the Transfer Agent
to process such Conversion Notice in accordance with the terms set forth herein. On or before the first (1st) Trading Day
following each date on which the Company has received a Conversion 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 initiated on the applicable Conversion Date of such Conversion
Shares issuable pursuant to such Conversion Notice) (the “Share Delivery Deadline”), the Company shall (1) provided
that the Transfer Agent is participating in FAST, credit such aggregate number of Conversion Shares to which such Holder shall be entitled
pursuant to such conversion to such Holder’s or its designee’s balance account with DTC through its Deposit/Withdrawal at
Custodian system, or (2) if the Transfer Agent is not participating in FAST, upon the request of such Holder, issue and deliver (via
reputable overnight courier) to the address as specified in such Conversion Notice, a certificate, registered in the name of such Holder
or its designee, for the number of Conversion Shares to which such Holder shall be entitled. If the number of Preferred Shares represented
by the Preferred Share Certificate(s) submitted for conversion pursuant to Section 4(c)(iii) is greater than the number of Preferred Shares
being converted, then the Company shall, as soon as practicable and in no event later than two (2) Trading Days after receipt of the
Preferred Share Certificate(s) and at its own expense, issue and mail to such Holder (or its designee) by overnight courier service a
new Preferred Share Certificate or a new Book-Entry (in either case, in accordance with Section 18(d)) representing the number of Preferred
Shares not converted. The Person or Persons entitled to receive the Conversion Shares issuable upon a conversion of Preferred Shares
shall be treated for all purposes as the record holder or holders of such Conversion Shares on the Conversion Date. Notwithstanding the
foregoing, if a Holder delivers a Conversion Notice to the Company prior to the date of issuance of Preferred Shares to such Holder,
whereby such Holder elects to convert such Preferred Shares pursuant to such Conversion Notice, the Share Delivery Deadline with respect
to any such Conversion Notice shall be the later of (x) the date of issuance of such Preferred Shares and (y) the first (1st) Trading
Day after the date of such Conversion Notice. Notwithstanding anything to the contrary contained in this Certificate of Designations
or the Registration Rights Agreement, after the effective date of a Registration Statement (as defined in the Registration Rights Agreement)
and prior to a Holder’s receipt of the notice of a Grace Period (as defined in the Registration Rights Agreement), the Company
shall cause the Transfer Agent to deliver unlegended shares of Common Stock to such Holder (or its designee) in connection with any sale
of Registrable Securities (as defined in the Registration Rights Agreement) with respect to which such 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 such Holder has not yet settled.
(ii)
Company’s Failure to Timely Convert. If the Company shall
fail, for any reason or for no reason, on or prior to the applicable Share Delivery Deadline, either (I) if the Transfer Agent is not
participating in FAST, to issue and deliver to such Holder (or its designee) a certificate for the number of Conversion Shares to which
such Holder is entitled and register such Conversion Shares on the Company’s share register or, if the Transfer Agent is participating
in FAST, to credit such Holder’s or its designee’s balance account with DTC for such number of Conversion Shares to which
such Holder is entitled upon such Holder’s conversion of any Conversion Amount (as the case may be) or (II) if the Registration
Statement covering the resale of the Conversion Shares that are the subject of the Conversion Notice (the “Unavailable Conversion
Shares”) is not available for the resale of such Unavailable Conversion Shares and the Company fails to promptly, but in no
event later than as required pursuant to the Registration Rights Agreement (x) notify such Holder and (y) deliver the shares of Common
Stock electronically without any restrictive legend by crediting such aggregate number of shares of Common Stock to which such Holder
is entitled pursuant to such conversion 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 “Conversion Failure”), then, in addition to all other
remedies available to such Holder, (X) the Company shall pay in cash to such Holder on each day after the Share Delivery Deadline that
the issuance of such Conversion Shares is not timely effected an amount equal to 2% of the product of (A) the sum of the number of Conversion
Shares not issued to such Holder on or prior to the Share Delivery Deadline and to which such Holder is entitled, multiplied by (B) any
trading price of the Common Stock selected by such Holder in writing as in effect at any time during the period beginning on the applicable
Conversion Date and ending on the applicable Share Delivery Deadline, and (Y) such Holder, upon written notice to the Company, may void
its Conversion Notice with respect to, and retain or have returned, as the case may be, all, or any portion, of such Preferred Shares
that has not been converted pursuant to such Conversion Notice; provided that the voiding of a Conversion 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 4(c)(ii)
or otherwise. In addition to the foregoing, if on or prior to the Share Delivery Deadline either (A) the Transfer Agent is not participating
in FAST, the Company shall fail to issue and deliver to such Holder (or its designee) a certificate and register such Conversion Shares
on the Company’s share register or, if the Transfer Agent is participating in the FAST, the Transfer Agent shall fail to credit
the balance account of such Holder or such Holder’s designee, as applicable, with DTC for the number of Conversion Shares to which
such Holder is entitled upon such Holder’s conversion hereunder or pursuant to the Company’s obligation pursuant to clause
(ii) below or (B) a Notice Failure occurs, and if on or after such Share Delivery Deadline such 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 Conversion Shares issuable upon
such conversion that such Holder is entitled to receive from the Company and has not received from the Company in connection with such
Conversion Failure or Notice Failure, as applicable (a “Buy-In”), then, in addition to all other remedies available
to such Holder, the Company shall, within two (2) Business Days after receipt of such Holder’s request and in such Holder’s
discretion, either: (I) pay cash to such Holder in an amount equal to such 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 such Holder) (the “Buy-In Price”), at which point the Company’s
obligation to so issue and deliver such certificate (and to issue such Conversion Shares) or credit to the balance account of such Holder
or such Holder’s designee, as applicable, with DTC for the number of Conversion Shares to which such Holder is entitled upon such
Holder’s conversion hereunder (as the case may be) (and to issue such Conversion Shares) shall terminate, or (II) promptly honor
its obligation to so issue and deliver to such Holder a certificate or certificates representing such Conversion Shares or credit the
balance account of such Holder or such Holder’s designee, as applicable, with DTC for the number of Conversion Shares to which
such Holder is entitled upon such Holder’s conversion hereunder (as the case may be) and pay cash to such Holder in an amount equal
to the excess (if any) of the Buy-In Price over the product of (x) such number of shares of Common Stock multiplied by (y) the lowest
Closing Sale Price of the Common Stock on any Trading Day during the period commencing on the date of the applicable Conversion Notice
and ending on the date of such issuance and payment under this clause (II) (each, a “Buy-In Payment Amount”). Nothing
herein 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 Conversion Shares (or to electronically deliver such Conversion Shares) upon the conversion of the Preferred Shares as required
pursuant to the terms hereof. Notwithstanding anything herein to the contrary, with respect to any given Notice Failure and/or Conversion
Failure, as applicable, this Section 4(c)(ii) shall not apply to a Holder to the extent the Company has already paid such amounts in
full to such Holder with respect to such Conversion Failure Notice Failure and/or Conversion Failure, as applicable, pursuant to the
analogous sections of any other agreement with such Holder.
(iii)
Registration; Book-Entry. At the time of issuance of any Preferred
Shares hereunder, the applicable Holder may, by written request (including by electronic-mail) to the Company, elect to receive such
Preferred Shares in the form of one or more Preferred Share Certificates or in Book-Entry form. The Company (or the Transfer Agent, as
custodian for the Preferred Shares) shall maintain a register (the “Register”) for the recordation of the names and
addresses of the Holders of each Preferred Share and the Stated Value of the Preferred Shares and whether the Preferred Shares are held
by such Holder in Preferred Share Certificates or in Book-Entry form (the “Registered Preferred Shares”). The entries
in the Register shall be conclusive and binding for all purposes absent manifest error. The Company and each Holder of the Preferred
Shares shall treat each Person whose name is recorded in the Register as the owner of a Preferred Share for all purposes (including,
without limitation, the right to receive payments and Dividends hereunder) notwithstanding notice to the contrary. A Registered Preferred
Share may be assigned, transferred or sold only by registration of such assignment or sale on the Register. Upon its receipt of a written
request to assign, transfer or sell one or more Registered Preferred Shares by such Holder thereof, the Company shall record the information
contained therein in the Register and issue one or more new Registered Preferred Shares in the same aggregate Stated Value as the Stated
Value of the surrendered Registered Preferred Shares to the designated assignee or transferee pursuant to Section 18, provided that
if the Company does not so record an assignment, transfer or sale (as the case may be) of such Registered Preferred Shares within two
(2) Business Days of such a request, then the Register shall be automatically deemed updated to reflect such assignment, transfer or
sale (as the case may be). Notwithstanding anything to the contrary set forth in this Section 4, following conversion of any Preferred
Shares in accordance with the terms hereof, the applicable Holder shall not be required to physically surrender such Preferred Shares
held in the form of a Preferred Share Certificate to the Company unless (A) the full or remaining number of Preferred Shares represented
by the applicable Preferred Share Certificate are being converted (in which event such certificate(s) shall be delivered to the Company
as contemplated by this Section 4(c)(iii)) or (B) such Holder has provided the Company with prior written notice (which notice may be
included in a Conversion Notice) requesting reissuance of Preferred Shares upon physical surrender of the applicable Preferred Share
Certificate. Each Holder and the Company shall maintain records showing the Stated Value and Dividends converted and/or paid (as the
case may be) and the dates of such conversions and/or payments (as the case may be) or shall use such other method, reasonably satisfactory
to such Holder and the Company, so as not to require physical surrender of a Preferred Share Certificate upon conversion. If the Company
does not update the Register to record such Stated Value and Dividends converted and/or paid (as the case may be) and the dates of such
conversions and/or payments (as the case may be) within two (2) Business Days of such occurrence, then the Register shall be automatically
deemed updated to reflect such occurrence. In the event of any dispute or discrepancy, such records of such Holder establishing the number
of Preferred Shares to which the record holder is entitled shall be controlling and determinative in the absence of manifest error. A
Holder and any transferee or assignee, by acceptance of a certificate, acknowledge and agree that, by reason of the provisions of this
paragraph, following conversion of any Preferred Shares, the number of Preferred Shares represented by such certificate may be less than
the number of Preferred Shares stated on the face thereof. Each Preferred Share Certificate shall bear the following legend:
ANY
TRANSFEREE OR ASSIGNEE OF THIS CERTIFICATE SHOULD CAREFULLY REVIEW THE TERMS OF THE CORPORATION’S CERTIFICATE OF DESIGNATIONS RELATING
TO THE SHARES OF SERIES A-1 CONVERTIBLE PREFERRED STOCK REPRESENTED BY THIS CERTIFICATE, INCLUDING SECTION 4(c)(iii) THEREOF. THE NUMBER
OF SHARES OF SERIES A-1 CONVERTIBLE PREFERRED STOCK REPRESENTED BY THIS CERTIFICATE MAY BE LESS THAN THE NUMBER OF SHARES OF SERIES A-1
CONVERTIBLE PREFERRED STOCK STATED ON THE FACE HEREOF PURSUANT TO SECTION 4(c)(iii) OF THE CERTIFICATE OF DESIGNATIONS RELATING TO THE
SHARES OF SERIES A-1 CONVERTIBLE PREFERRED STOCK REPRESENTED BY THIS CERTIFICATE.
(iv)
Pro Rata Conversion; Disputes. In the event that the Company receives a Conversion Notice from more than one Holder for the same
Conversion Date and the Company can convert some, but not all, of such Preferred Shares submitted for conversion, the Company shall convert
from each Holder electing to have Preferred Shares converted on such date a pro rata amount of such Holder’s Preferred Shares submitted
for conversion on such date based on the number of Preferred Shares submitted for conversion on such date by such Holder relative to
the aggregate number of Preferred Shares submitted for conversion on such date. In the event of a dispute as to the number of Conversion
Shares issuable to a Holder in connection with a conversion of Preferred Shares, the Company shall issue to such Holder the number of
Conversion Shares not in dispute and resolve such dispute in accordance with Section 23. If a Conversion Notice delivered to the Company
would result in a breach of Section 4(d) below, and the Holder does not elect in writing to withdraw, in whole, such Conversion Notice,
the Company shall hold such Conversion Notice in abeyance until such time as such Conversion Notice may be satisfied without violating
Section 4(d) below (with such calculations thereunder made as of the date such Conversion Notice was initially delivered to the Company).
(d)
Limitation on Beneficial Ownership.
(i)
Beneficial Ownership. The Company shall not effect the conversion
of any of the Preferred Shares held by a Holder, and such Holder shall not have the right to convert any of the Preferred Shares held
by such Holder pursuant to the terms and conditions of this Certificate of Designations and any such conversion shall be null and void
and treated as if never made, to the extent that after giving effect to such conversion, such 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 conversion. For purposes of the foregoing sentence, the aggregate number of
shares of Common Stock beneficially owned by such Holder and the other Attribution Parties shall include the number of shares of Common
Stock held by such Holder and all other Attribution Parties plus the number of shares of Common Stock issuable upon conversion
of the Preferred Shares 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) conversion of the remaining, nonconverted Preferred Shares beneficially owned by such Holder or any
of the other Attribution Parties and (B) exercise or conversion of the unexercised or nonconverted portion of any other securities of
the Company (including, without limitation, any convertible notes, convertible preferred stock or warrants, including the Preferred Shares)
beneficially owned by such Holder or any other Attribution Party subject to a limitation on conversion or exercise analogous to the limitation
contained in this Section 4(d). For purposes of this Section 4(d), beneficial ownership shall be calculated in accordance with Section
13(d) of the 1934 Act. For the avoidance of doubt, the calculation of the Maximum Percentage shall take into account the concurrent exercise
and/or conversion, as applicable, of the unexercised or unconverted portion of any other securities of the Company beneficially owned
by the Holder and/or any other Attribution Party, as applicable. For purposes of determining the number of outstanding shares of Common
Stock a Holder may acquire upon the conversion of such Preferred Shares without exceeding the Maximum Percentage, such 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 a Conversion Notice from a 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 notify such Holder in writing of the number of shares of Common Stock then outstanding and, to the extent that such Conversion
Notice would otherwise cause such Holder’s beneficial ownership, as determined pursuant to this Section 4(d), to exceed the Maximum
Percentage, such Holder must notify the Company of a reduced number of shares of Common Stock to be purchased pursuant to such Conversion
Notice. For any reason at any time, upon the written or oral request of any Holder, the Company shall within one (1) Business Day confirm
orally and in writing or by electronic mail to such 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 such Preferred Shares, by such 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 a Holder upon conversion of such Preferred Shares results
in such 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 such 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 such Holder shall not have the
power to vote or to transfer the Excess Shares. Upon delivery of a written notice to the Company, any 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 of such Holder 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 such Holder and the other Attribution Parties and not to any other Holder that
is not an Attribution Party of such Holder. For purposes of clarity, the shares of Common Stock issuable to a Holder pursuant to the
terms of this Certificate of Designations in excess of the Maximum Percentage shall not be deemed to be beneficially owned by such Holder
for any purpose including for purposes of Section 13(d) or Rule 16a-1(a)(1) of the 1934 Act. No prior inability to convert such Preferred
Shares pursuant to this paragraph shall have any effect on the applicability of the provisions of this paragraph with respect to any
subsequent determination of convertibility. The provisions of this paragraph shall not be construed and implemented in a manner otherwise
than in strict conformity with the terms of this Section 4(d) 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 4(d) 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 such Preferred Shares.
(ii)
Principal Market Regulation. The Company shall not issue any shares of Common Stock upon conversion of any Preferred Shares or
otherwise pursuant to the terms of this Certificate of Designations if the issuance of such shares of Common Stock would exceed the aggregate
number of shares of Common Stock which the Company may issue upon exercise or conversion (as the case may be) of the Preferred Shares
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 Holder
shall be issued in the aggregate, upon conversion or exercise (as the case may be) of any Preferred Shares, shares of Common Stock 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) the
aggregate number of Preferred Shares issued to such Holder on the Initial Issuance Date divided by (2) the aggregate number of shares
of Preferred Shares and Parity Stock outstanding as of the Initial Issuance Date (with respect to each Holder, the “Exchange
Cap Allocation”). In the event that any Holder shall sell or otherwise transfer any of such Holder’s Preferred Shares,
the transferee shall be allocated a pro rata portion of such Holder’s Exchange Cap Allocation with respect to such portion of such
Preferred Shares so transferred, and the restrictions of the prior sentence shall apply to such transferee with respect to the portion
of the Exchange Cap Allocation so allocated to such transferee. Upon conversion in full of a Holder’s Preferred Shares, the
difference (if any) between such Holder’s Exchange Cap Allocation and the number of shares of Common Stock actually issued to such
Holder upon such Holder’s conversion in full of such Preferred Shares shall be allocated, to the respective Exchange Cap Allocations
of the remaining holders of Preferred Shares and Parity Stock on a pro rata basis in proportion to the shares of Common Stock underlying
the shares of preferred stock of the Company then held by each such holder of Preferred Shares and/or Parity Stock, as applicable.
(e)
Right of Alternate Conversion Upon a Triggering Event.
(i)
General. Subject to Section 4(d), at any time after the earlier of a Holder’s receipt of a Triggering Event Notice (as defined
below) and such Holder becoming aware of a Triggering Event (such earlier date, the “Alternate Conversion Right Commencement
Date”) and ending (such ending date, the “Alternate Conversion Right Expiration Date”, and each such period,
an “Alternate Conversion Right Period”) on the twentieth (20th) Trading Day after the later of (x) the
date such Triggering Event is cured and (y) such Holder’s receipt of a Triggering Event Notice that includes (I) a reasonable description
of the applicable Triggering Event, (II) a certification as to whether, in the reasonable opinion of the Company, such Triggering Event
is capable of being cured and, if applicable, a reasonable description of any existing plans of the Company to cure such Triggering Event
and (III) a certification as to the date the Triggering Event occurred and, if cured on or prior to the date of such Triggering Event
Notice, the applicable Alternate Conversion Right Expiration Date, such Holder may, at such Holder’s option, by delivery of a Conversion
Notice to the Company (the date of any such Conversion Notice, each an “Alternate Conversion Date”), convert all,
or any number of Preferred Shares held by such Holder into shares of Common Stock at the Alternate Conversion Price (each, an “Alternate
Conversion”).
(ii)
Mechanics of Alternate Conversion. On any Alternate Conversion Date, a Holder may voluntarily convert any number of Preferred
Shares held by such Holder pursuant to Section 4(c) (with “Alternate Conversion Price” replacing “Conversion Price”
for all purposes hereunder with respect to such Alternate Conversion and with “the applicable Required Premium multiplied by the
Conversion Amount” replacing “Conversion Amount” in clause (x) of the definition of Conversion Rate in Section 4(b)
above with respect to such Alternate Conversion) by designating in the Conversion Notice delivered pursuant to this Section 4(e) of this
Certificate of Designations that such Holder is electing to use the Alternate Conversion Price for such conversion; provided that in
the event of the Conversion Floor Price Condition, on the applicable Alternate Conversion Date the Stated Value of the remaining Preferred
Shares of such Holder shall automatically increase, pro rata, by the applicable Alternate Conversion Floor Amount or, at the Company’s
option, the Company shall deliver the applicable Alternate Conversion Floor Amount to the Holder on the applicable Alternate Conversion
Date. Notwithstanding anything to the contrary in this Section 4(e), but subject to Section 4(d), until the Company delivers to such
Holder the shares of Common Stock to which the Holder is entitled pursuant to the applicable Alternate Conversion of such Holder’s
Preferred Shares, such Preferred Shares may be converted by such Holder into shares of Common Stock pursuant to Section 4(c) without
regard to this Section 4(e).
5.
Triggering Events.
(a)
General. Each of the following events shall constitute a “Triggering Event” and each of the events in clauses
5(a)(ix), 5(a)(x), and 5(a)(xi), shall constitute a “Bankruptcy Triggering Event”:
(i)
the failure of the applicable Registration Statement (as defined in the
Registration Rights Agreement) to be filed with the SEC on or prior to the date that is five (5) days after the applicable Filing Deadline
(as defined in the Registration Rights Agreement) or the failure of the applicable Registration Statement to be declared effective by
the SEC on or prior to the date that is five (5) days after the applicable Effectiveness Deadline (as defined in the Registration Rights
Agreement);
(ii)
while the applicable Registration Statement is required to be maintained
effective pursuant to the terms of the Registration Rights Agreement, the effectiveness of the applicable Registration Statement lapses
for any reason (including, without limitation, the issuance of a stop order) or such Registration Statement (or the prospectus contained
therein) is unavailable to any holder of Registrable Securities (as defined in the Registration Rights Agreement) for sale of all of
such holder’s Registrable Securities in accordance with the terms of the Registration Rights Agreement, and such lapse or unavailability
continues for a period of five (5) consecutive days or for more than an aggregate of ten (10) days in any 365-day period (excluding days
during an Allowable Grace Period (as defined in the Registration Rights Agreement));
(iii)
the suspension from trading or the failure of the Common Stock to be
trading or listed (as applicable) on an Eligible Market for a period of five (5) consecutive Trading Days or the delisting, removal or
withdrawal, as applicable, of registration of the Common Stock under the 1934 Act with respect to a going-private transaction;
(iv)
the Company’s failure (A) to cure a Conversion Failure by delivery
of the required number of shares of Common Stock within five (5) Trading Days after the applicable Conversion Date or exercise date (as
the case may be) or (B) notice, written or oral, to any holder of Preferred Shares, including, without limitation, by way of public announcement
or through any of its agents, at any time, of its intention not to comply, as required, with a request for conversion of any Preferred
Shares into shares of Common Stock that is requested in accordance with the provisions of this Certificate of Designations, other than
pursuant to Section 4(d) hereof;
(v)
except to the extent the Company is in compliance with Section 11(b)
below, at any time following the tenth (10th) consecutive day that a Holder’s Authorized Share Allocation (as defined in Section
11(a) below) is less than the Required Reserve Amount as of such date of determination;
(vi)
the Company’s failure to pay to any Holder any Dividend when required
to be paid hereunder (whether or not declared by the Board) or any other amount when and as due under this Certificate of Designations
(including, without limitation, the Company’s failure to pay any redemption payments or amounts hereunder), the Exchange Agreements
or any other Transaction Document or any other agreement, document, certificate or other instrument delivered in connection with the
transactions contemplated hereby and thereby (in each case, whether or not permitted pursuant to the DGCL), except, in the case of a
failure to pay Dividends when and as due, in each such case only if such failure remains uncured for a period of at least two (2) Trading
Days;
(vii)
the Company fails to remove any restrictive legend on any certificate
or any shares of Common Stock issued to the applicable Holder upon conversion of the Preferred Shares held by such Holder as and when
required by this Certificate of Designations, unless otherwise then prohibited by applicable federal securities laws, and any such failure
remains uncured for at least five (5) days;
(viii)
the occurrence of any default under, redemption of or acceleration prior
to maturity of at least an aggregate of $500,000 of indebtedness for borrowed money of the Company or any of its Subsidiaries, excluding
any indebtedness for borrowed money in which no cash payment is required at such time pursuant to a forbearance agreement in full force
and effect or any applicable grace period under the terms of such indebtedness for borrowed money, except, in the case of a default or
breach that is curable, only if such default or breach, as applicable, remains uncured for a period of twenty (20) days;
(ix)
bankruptcy, insolvency, reorganization or liquidation proceedings or
other proceedings for the relief of debtors shall be instituted by or against the Company or any Subsidiary and, if instituted against
the Company or any Subsidiary by a third party, shall not be dismissed within thirty (30) days of their initiation;
(x)
the commencement by the Company or any Subsidiary of a voluntary case
or proceeding under any applicable federal, state or foreign bankruptcy, insolvency, reorganization or other similar law or of any other
case or proceeding to be adjudicated a bankrupt or insolvent, or the consent by it to the entry of a decree, order, judgment or other
similar document in respect of the Company or any Subsidiary in an involuntary case or proceeding under any applicable federal, state
or foreign bankruptcy, insolvency, reorganization or other similar law or to the commencement of any bankruptcy or insolvency case or
proceeding against it, or the filing by it of a petition or answer or consent seeking reorganization or relief under any applicable federal,
state or foreign law, or the consent by it to the filing of such petition or to the appointment of or taking possession by a custodian,
receiver, liquidator, assignee, trustee, sequestrator or other similar official of the Company or any Subsidiary or of any substantial
part of its property, or the making by it of an assignment for the benefit of creditors, or the execution of a composition of debts,
or the occurrence of any other similar federal, state or foreign proceeding, or the admission by it in writing of its inability to pay
its debts generally as they become due, the taking of corporate action by the Company or any Subsidiary in furtherance of any such action
or the taking of any action by any Person to commence a Uniform Commercial Code foreclosure sale or any other similar action under federal,
state or foreign law;
(xi)
the entry by a court of (i) a decree, order, judgment or other similar
document in respect of the Company or any Subsidiary of a voluntary or involuntary case or proceeding under any applicable federal, state
or foreign bankruptcy, insolvency, reorganization or other similar law or (ii) a decree, order, judgment or other similar document adjudging
the Company or any Subsidiary as bankrupt or insolvent, or approving as properly filed a petition seeking liquidation, reorganization,
arrangement, adjustment or composition of or in respect of the Company or any Subsidiary under any applicable federal, state or foreign
law or (iii) a decree, order, judgment or other similar document appointing a custodian, receiver, liquidator, assignee, trustee, sequestrator
or other similar official of the Company or any Subsidiary or of any substantial part of its property, or ordering the winding up or
liquidation of its affairs, and the continuance of any such decree, order, judgment or other similar document or any such other decree,
order, judgment or other similar document unstayed and in effect for a period of thirty (30) consecutive days;
(xii)
a final judgment or judgments for the payment of money aggregating in
excess of $500,000 are rendered against the Company and/or any of its Subsidiaries and which judgments are not, within thirty (30) days
after the entry thereof, bonded, discharged, settled or stayed pending appeal, or are not discharged within thirty (30) days after the
expiration of such stay; provided, however, any judgment which is covered by insurance or an indemnity from a credit worthy party shall
not be included in calculating the $500,000 amount set forth above so long as the Company provides each Holder a written statement from
such insurer or indemnity provider (which written statement shall be reasonably satisfactory to each 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;
(xiii)
the Company and/or any Subsidiary, individually or in the aggregate,
either (i) fails to pay, when due, or within any applicable grace period, any payment with respect to any Indebtedness in excess of $500,000
due to any third party (other than, with respect to unsecured Indebtedness only, payments contested by the Company and/or such Subsidiary
(as the case may be) in good faith by proper proceedings and with respect to which adequate reserves have been set aside for the payment
thereof in accordance with GAAP) or is otherwise in breach or violation of any agreement for monies owed or owing in an amount in excess
of $500,000, which breach or violation permits the other party thereto to declare a default or otherwise accelerate amounts due thereunder,
or (ii) suffer to exist any other circumstance or event that would, with or without the passage of time or the giving of notice, result
in a default or event of default under any agreement binding the Company or any Subsidiary, which default or event of default would or
is likely to have a material adverse effect on the business, assets, operations (including results thereof), liabilities, properties,
condition (including financial condition) or prospects of the Company or any of its Subsidiaries, individually or in the aggregate;
(xiv)
other than as specifically set forth in another clause of this Section
5(a), the Company or any Subsidiary breaches any representation or warranty in any material respect (other than representations or warranties
subject to material adverse effect or materiality, which may not be breached in any respect) or any 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 that is curable, only if such breach
remains uncured for a period of five (5) consecutive Trading Days;
(xv)
a false or inaccurate certification (including a false or inaccurate
deemed certification) by the Company as to whether any Triggering Event has occurred;
(xvi)
any Preferred Shares remain outstanding on or after December 22, 2026;
(xvii)
any breach or failure in any respect by the Company or any Subsidiary
to comply with any provision of Section 13 of this Certificate of Designations;
(xviii)
any Change of Control occurs;
(xix)
any Material Adverse Effect (as defined in the Exchange Agreements) occurs;
or
(xx)
any provision of any Transaction Document shall at any time for any reason
(other than pursuant to the express terms thereof) cease to be valid and binding on or enforceable against the parties thereto, or the
validity or enforceability thereof shall be contested, directly or indirectly, by the Company or any Subsidiary, or a proceeding shall
be commenced by the Company or any Subsidiary or any Governmental Authority having jurisdiction over any of them, seeking to establish
the invalidity or unenforceability thereof or the Company or any of its Subsidiaries shall deny in writing that it has any liability
or obligation purported to be created under one or more Transaction Documents.
(b)
Notice of a Triggering Event. Upon the occurrence of a Triggering Event with respect to the Preferred Shares, the Company shall
within one (1) Business Day deliver written notice thereof via electronic mail and overnight courier (with next day delivery specified)
(a “Triggering Event Notice”) to each Holder.
(c)
Mandatory Redemption upon Bankruptcy Triggering Event. Notwithstanding anything to the contrary herein, and notwithstanding any
conversion that is then required or in process, upon any Bankruptcy Triggering Event, the Company shall immediately redeem, in cash,
each of the Preferred Shares then outstanding at a redemption price equal to the greater of (i) the product of (A) the Conversion Amount
to be redeemed multiplied by (B) the Required Premium and (ii) the product of (X) the Conversion Rate (calculated using the lowest Alternate
Conversion Price during the period commencing on the 20th Trading Day immediately preceding such public announcement and ending on the
date the Company makes the entire redemption payment pursuant to this Section 5(c)) with respect to the Conversion Amount in effect immediately
following the date of initial public announcement (or public filing of bankruptcy documents, as applicable) of such Bankruptcy Triggering
Event multiplied by (Y) the product of (1) the Required Premium multiplied by (2) the greatest Closing Sale Price of the Common Stock
on any Trading Day during the period commencing on the date immediately preceding such Bankruptcy Triggering Event and ending on the
date the Company makes the entire payment required to be made under this Section 5(c), without the requirement for any notice or demand
or other action by any Holder or any other person or entity, provided that a Holder may, in its sole discretion, waive such right to
receive payment upon a Bankruptcy Triggering Event, in whole or in part, and any such waiver shall not affect any other rights of such
Holder or any other Holder hereunder, including any other rights in respect of such Bankruptcy Triggering Event or any right to conversion
(or Alternate Conversion), as applicable.
6.
Rights Upon Fundamental Transactions.
(a)
Assumption. 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 Certificate of Designations and the other Transaction Documents in accordance
with the provisions of this Section 6(a) pursuant to written agreements in form and substance satisfactory to the Required Holders and
approved by the Required Holders prior to such Fundamental Transaction, including agreements to deliver to each holder of Preferred Shares
in exchange for such Preferred Shares a security of the Successor Entity evidenced by a written instrument substantially similar in form
and substance to this Certificate of Designations, including, without limitation, having a stated value and dividend rate equal to the
stated value and dividend rate of the Preferred Shares held by the Holders and having similar ranking to the Preferred Shares, and satisfactory
to the Required Holders and (ii) the Successor Entity (including its Parent Entity) is a publicly traded corporation whose shares
of common stock are quoted on or listed for trading on an Eligible Market. Upon the occurrence of any Fundamental Transaction, the Successor
Entity shall succeed to, and be substituted for (so that from and after the date of such Fundamental Transaction, the provisions of this
Certificate of Designations 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 Certificate
of Designations and the other Transaction Documents with the same effect as if such Successor Entity had been named as the Company herein
and therein. In addition to the foregoing, upon consummation of a Fundamental Transaction, the Successor Entity shall deliver to each
Holder confirmation that there shall be issued upon conversion or redemption of the Preferred Shares at any time after the consummation
of such 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 7 and 15, which shall continue to be receivable thereafter)) issuable upon the conversion or redemption
of the Preferred Shares prior to such Fundamental Transaction, such shares of the publicly traded common stock (or their equivalent)
of the Successor Entity (including its Parent Entity) which each Holder would have been entitled to receive upon the happening of such
Fundamental Transaction had all the Preferred Shares held by each Holder been converted immediately prior to such Fundamental Transaction
(without regard to any limitations on the conversion of the Preferred Shares contained in this Certificate of Designations), as adjusted
in accordance with the provisions of this Certificate of Designations. Notwithstanding the foregoing, such Holder may elect, at its sole
option, by delivery of written notice to the Company to waive this Section 6(a) to permit the Fundamental Transaction without the assumption
of the Preferred Shares. The provisions of this Section 6 shall apply similarly and equally to successive Fundamental Transactions and
shall be applied without regard to any limitations on the conversion or redemption of the Preferred Shares.
(b)
Notice of a Change of Control; Change of Control Election Notice. No sooner than twenty (20) Trading Days nor later than ten (10)
Trading Days prior to the consummation of a Change of Control (the “Change of Control Date”), but not prior to the
public announcement of such Change of Control, the Company shall deliver written notice thereof via electronic mail and overnight courier
to each Holder (a “Change of Control Notice”). At any time during the period beginning after a Holder’s receipt
of a Change of Control Notice or such Holder becoming aware of a Change of Control if a Change of Control Notice is not delivered to
such Holder in accordance with the immediately preceding sentence (as applicable) and ending on twenty (20) Trading Days after the later
of (A) the date of consummation of such Change of Control or (B) the date of receipt of such Change of Control Notice or (C) the date
of the announcement of such Change of Control, such Holder may require, by delivering written notice thereof (“Change of Control
Election Notice”) to the Company (which Change of Control Election Notice shall indicate the number of Preferred Shares subject
to such election), to have the Company exchange such Holder’s Preferred Shares designated in such Change of Control Election Notice
for consideration equal to the Change of Control Election Price (as defined below), to be satisfied at the Company’s election (such
election to pay in cash or by delivery of the Rights (as defined below), a “Consideration Election”), in either (I)
rights (with a beneficial ownership limitation in the form of Section 4(d) hereof, mutatis mutandis) (collectively, the “Rights”),
convertible in whole, or in part, at any time, without the requirement to pay any additional consideration, at the option of the Holder,
into such Corporate Event Consideration (as defined below) applicable to such Change of Control equal in value to the Change of Control
Election Price (as determined with the fair market value of the aggregate number of Successor Shares (as defined below) issuable upon
conversion of the Rights to be determined in increments of 10% (or such greater percentage as the applicable Holder may notify the Company
from time to time) of the portion of the Change of Control Election Price attributable to such Successor Shares (the “Successor
Share Value Increment”), with the aggregate number of Successor Shares issuable upon exercise of the Rights with respect to
the first Successor Share Value Increment determined based on 70% of the Closing Bid Price of the Successor Shares on the date the Rights
are issued and on each of the nine (9) subsequent Trading Days, in each case, the aggregate number of additional Successor Shares issuable
upon exercise of the Rights shall be determined based upon a Successor Share Value Increment at 70% of the Closing Bid Price of the Successor
Shares in effect for such corresponding Trading Day (such ten (10) Trading Day period commencing on, and including, the date the Rights
are issued, the “Rights Measuring Period”)), or (II) in cash; provided, that the Company shall not consummate a Change
of Control if the Corporate Event Consideration includes capital stock or other equity interest (the “Successor Shares”)
either in an entity that is not listed on an Eligible Market or an entity in which the daily share volume for the applicable Successor
Shares for each of the twenty (20) Trading Days prior to the date of consummation of such Change of Control is less than the aggregate
number of Successor Shares issuable to all Holders upon conversion in full of the applicable Rights (without regard to any limitations
on conversion therein, assuming the exercise in full of the Rights on the date of issuance of the Rights and assuming the Closing Bid
Price of the Successor Shares for each Trading Day in the Rights Measuring Period is the Closing Bid Price on the Trading Day ended immediately
prior to the time of consummation of the Change of Control). The Company shall give each Holder written notice of each Consideration
Election at least twenty (20) Trading Days prior to the time of consummation of such Change of Control. Payment of such amounts or delivery
of the Rights, as applicable, shall be made by the Company (or at the Company’s direction) to each Holder on the later of (x) the
second (2nd) Trading Day after the date of such request and (y) the date of consummation of such Change of Control (or, with respect
to any Right, if applicable, such later time that holders of shares of Common Stock are initially entitled to receive Corporate Event
Consideration with respect to the shares of Common Stock of such holder). Any Corporate Event Consideration included in the Rights, if
any, pursuant to this Section 6(b) is pari passu with the Corporate Event Consideration to be paid to holders of shares of Common
Stock and the Company shall not permit a payment of any Corporate Event Consideration to the holders of shares of Common Stock without
on or prior to such time delivering the Right to the Holders in accordance herewith. Cash payments, if any, required by this Section
6(b) shall have priority to payments to all other stockholders of the Company in connection with such Change of Control. Notwithstanding
anything to the contrary in this Section 6(b), but subject to Section 4(d), until the applicable Change of Control Election Price is
paid in full to the applicable Holder in cash or Corporate Event Consideration in accordance herewith, the Preferred Shares submitted
by such Holder for exchange or payment, as applicable, under this Section 6(b) may be converted, in whole or in part, by such Holder
into Common Stock pursuant to Section 4 or in the event the Conversion Date is after the consummation of such Change of Control, stock
or equity interests of the Successor Entity substantially equivalent to the Company’s shares of Common Stock pursuant to Section
6(a). In the event of the Company’s repayment or exchange, as applicable, of any of the Preferred Shares under this Section 6(b),
such 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 a Holder. Accordingly, any Required
Premium due under this Section 6(b) is intended by the parties to be, and shall be deemed, a reasonable estimate of such Holder’s
actual loss of its investment opportunity and not as a penalty. Notwithstanding anything herein to the contrary, in connection with any
redemption hereunder at a time a Holder is entitled to receive a cash payment under any of the other Transaction Documents, at the option
of such Holder delivered in writing to the Company, the applicable redemption price hereunder shall be increased by the amount of such
cash payment owed to such Holder under such other Transaction Document and, upon payment in full or conversion in accordance herewith,
shall satisfy the Company’s payment obligation under such other Transaction Document.
7.
Rights Upon Issuance of Purchase Rights and Other Corporate Events.
(a)
Purchase Rights. In addition to any adjustments pursuant to Section 8 and Section 15 below, 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 all
or substantially all of the record holders of any class of Common Stock (the “Purchase Rights”), then each Holder
will be entitled to acquire, upon the terms applicable to such Purchase Rights, the aggregate Purchase Rights which such Holder could
have acquired if such Holder had held the number of shares of Common Stock acquirable upon complete conversion of all the Preferred Shares
(without taking into account any limitations or restrictions on the convertibility of the Preferred Shares and assuming for such purpose
that all the Preferred Shares were converted at the Alternate Conversion Price as of the applicable record date) held by such Holder
immediately prior to the date on which a record is taken for the grant, issuance or sale of such Purchase Rights, or, if no such record
is taken, the date as of which the record holders of shares of Common Stock are to be determined for the grant, issue or sale of such
Purchase Rights; provided, however, to the extent that such Holder’s right to participate in any such Purchase Right would result
in such Holder and the other Attribution Parties exceeding the Maximum Percentage, then such Holder shall not be entitled to participate
in such Purchase Right to such 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 such extent of any such excess) and such Purchase Right
to such extent shall be held in abeyance (and, if such Purchase Right has an expiration date, maturity date or other similar provision,
such term shall be extended by such number of days held in abeyance, if applicable) for the benefit of such Holder until such time or
times, if ever, as its right thereto would not result in such Holder and the other Attribution Parties exceeding the Maximum Percentage,
at which time or times such 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 (and, if such Purchase Right has an expiration date, maturity date
or other similar provision, such term shall be extended by such number of days held in abeyance, if applicable)) to the same extent as
if there had been no such limitation.
(b)
Other Corporate Events. In addition to and not in substitution for any other rights hereunder, prior to the consummation of any
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
ensure that each Holder will thereafter have the right, at such Holder’s option, to receive upon a conversion of all the Preferred
Shares held by such Holder (i) in addition to the shares of Common Stock receivable upon such conversion, such securities or other assets
(the “Corporate Event Consideration”) to which such Holder would have been entitled with respect to such shares of
Common Stock had such shares of Common Stock been held by such Holder upon the consummation of such Corporate Event (without taking into
account any limitations or restrictions on the convertibility of the Preferred Shares set forth in this Certificate of Designations)
or (ii) in lieu of the shares of Common Stock otherwise receivable upon such conversion, such securities or other assets received by
the holders of shares of Common Stock in connection with the consummation of such Corporate Event in such amounts as such Holder would
have been entitled to receive had the Preferred Shares held by such Holder initially been issued with conversion rights for the form
of such consideration (as opposed to shares of Common Stock) at a conversion rate for such consideration commensurate with the Conversion
Rate of an Alternate Conversion. Provision made pursuant the preceding sentence shall be in a form and substance satisfactory to the
Required Holders. The provisions of this Section 7 shall apply similarly and equally to successive Corporate Events and shall be applied
without regard to any limitations on the conversion or redemption of the Preferred Shares set forth in this Certificate of Designations.
8.
Rights Upon Issuance of Other Securities.
(a)
Adjustment of Conversion Price upon Issuance of Common Stock. If and whenever on or after the Adjustment Measurement Commencement
Date the Company grants, issues or sells (or enters into any agreement to grant, issue or sell), or in accordance with this Section 8(a)
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 Conversion
Price in effect immediately prior to such granting, issuance or sale or deemed granting, issuance or sale (such Conversion Price then
in effect is referred to herein as the “Applicable Price”) (the foregoing a “Dilutive Issuance”),
then, immediately after such Dilutive Issuance, the Conversion 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 Conversion Price and the New Issuance
Price under this Section 8(a)), 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 of such Option for such price per share. For
purposes of this Section 8(a)(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 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 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 Conversion 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 8(a)(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 Conversion 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 Conversion Price has been or is to be made pursuant to other provisions of this Section 8(a),
except as contemplated below, no further adjustment of the Conversion 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 8(b) below),
the Conversion Price in effect at the time of such increase or decrease shall be adjusted to the Conversion 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 8(a)(iii), if the terms of any Option or Convertible Security (including, without limitation, any Option or Convertible
Security that was outstanding as of the Exchange Agreements Effective 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 8(a) shall be made if such adjustment would result in an increase of the Conversion 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 8(a)(i) or 8(a)(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 any Preferred Shares are converted, on any given Conversion Date during any such Adjustment Period,
solely with respect to such Preferred Shares converted on such applicable Conversion Date, such applicable Adjustment Period shall be
deemed to have ended on, and included, the Trading Day immediately prior to such Conversion 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).
(b)
Adjustment of Conversion Price upon Subdivision or Combination of Common Stock. Without limiting any provision of Section 7 or
Section 15, if the Company at any time on or after the Exchange Agreements Effective Date subdivides (by any stock split, stock dividend,
stock combination, recapitalization or other similar transaction) one or more classes of its outstanding shares of Common Stock into
a greater number of shares, the Conversion Price in effect immediately prior to such subdivision will be proportionately reduced. Without
limiting any provision of Section 7 or Section 15, if the Company at any time on or after the Exchange Agreements Effective Date combines
(by any stock split, stock dividend, stock combination, recapitalization or other similar transaction) one or more classes of its outstanding
shares of Common Stock into a smaller number of shares, the Conversion Price in effect immediately prior to such combination will be
proportionately increased. Any adjustment pursuant to this Section 8(b) shall become effective immediately after the effective date of
such subdivision or combination. If any event requiring an adjustment under this Section 8(b) occurs during the period that a Conversion
Price is calculated hereunder, then the calculation of such Conversion Price shall be adjusted appropriately to reflect such event.
(c)
Holder’s Right of Adjusted Conversion Price. In addition to and not in limitation of the other provisions of this Section
8(c), if the Company in any manner issues or sells or enters into any agreement to issue or sell, any Common Stock, Options or
Convertible Securities (any such securities, “Variable Price Securities”) after the Adjustment Measurement Commencement
Date that are issuable pursuant to such agreement or convertible into or exchangeable or exercisable for shares of Common Stock at a
price which varies or may vary with the market price of the shares of Common Stock, including by way of one or more reset(s) to a fixed
price, but exclusive of such formulations reflecting share splits, share combinations, and share dividends (each of the formulations
for such variable price being herein referred to as, the “Variable Price”), the Company shall provide written notice
thereof via electronic mail and overnight courier to each Holder on the date of such agreement and/or the issuance of such shares of
Common Stock, Convertible Securities or Options, as applicable. From and after the date the Company enters into such agreement or issues
any such Variable Price Securities, each Holder shall have the right, but not the obligation, in its sole discretion to substitute the
Variable Price for the Conversion Price upon conversion of the Preferred Shares by designating in the Conversion Notice delivered upon
any conversion of Preferred Shares that solely for purposes of such conversion such Holder is relying on the Variable Price rather than
the Conversion Price then in effect. A Holder’s election to rely on a Variable Price for a particular conversion of Preferred Shares
shall not obligate such Holder to rely on a Variable Price for any future conversions of Preferred Shares.
(d)
[Reserved]
(e)
Other Events. In the event that the Company (or any Subsidiary) shall take any action to which the provisions hereof are not strictly
applicable, or, if applicable, would not operate to protect any Holder from dilution or if any event occurs of the type contemplated
by the provisions of this Section 8 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 Board shall in good faith determine and
implement an appropriate adjustment in the Conversion Price so as to protect the rights of such Holder, provided that no such adjustment
pursuant to this Section 8(e) will increase the Conversion Price as otherwise determined pursuant to this Section 8, provided further
that if such Holder does not accept such adjustments as appropriately protecting its interests hereunder against such dilution, then
the Board and such 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 8 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 issue 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 any
Preferred Shares remain outstanding, with the prior written consent of the Required Holder, reduce the then current Conversion Price
to any amount and for any period of time deemed appropriate by the Board.
(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 (each, an “Adjustment
Date”), the Conversion Price then in effect is greater than the Market Price then in effect (the “Adjustment Price”),
on the Adjustment Date the Conversion Price shall automatically lower to the Adjustment Price.
(i)
Exchange Right. Notwithstanding anything herein to the contrary, if a Holder participates in a Subsequent Placement (as defined
in the Exchange Agreement), each such Holder may, at the option of such Holder as elected in writing to the Company, satisfy the purchase
price of the securities to be sold to such Holder in such Subsequent Placement, in whole or in part, with Preferred Shares valued at
120% of the Conversion Amount of the Preferred Shares delivered by such Holder as payment therefor.
9.
Redemption at the Company’s Election. At any time, the Company
shall have the right to redeem all, but not less than all, of the Preferred Shares then outstanding (the “Company Optional Redemption
Amount”) on the Company Optional Redemption Date (each as defined below) (a “Company Optional Redemption”).
The Preferred Shares subject to redemption pursuant to this Section 9 shall be redeemed by the Company in cash at a price (the “Company
Optional Redemption Price”) equal to 115% of the greater of (i) the Conversion Amount being redeemed as of the Company Optional
Redemption Date and (ii) the product of (1) the Conversion Rate with respect to the Conversion Amount being redeemed as of the Company
Optional Redemption Date multiplied by (2) the greatest Closing Sale Price of the Common Stock on any Trading Day during the period commencing
on the date immediately preceding such Company Optional Redemption Notice Date and ending on the Trading Day immediately prior to the
date the Company makes the entire payment required to be made under this Section 9. The Company may exercise its right to require redemption
under this Section 9 by delivering a written notice thereof by electronic mail and overnight courier to all, but not less than all, of
the Holders (the “Company Optional Redemption Notice” and the date all of the Holders received such notice is referred
to as the “Company Optional Redemption Notice Date”). The Company may deliver only one Company Optional Redemption
Notice hereunder and such Company Optional Redemption Notice shall be irrevocable. The Company Optional Redemption Notice shall (x) state
the date on which the Company Optional Redemption shall occur (the “Company Optional Redemption Date”) which date
shall not be less than ten (10) Trading Days nor more than twenty (20) Trading Days following the Company Optional Redemption Notice
Date, (y) certify that there has been no Equity Conditions Failure and (z) state the aggregate Conversion Amount of the Preferred Shares
which is being redeemed in such Company Optional Redemption from such Holder and all of the other Holders of the Preferred Shares pursuant
to this Section 9 on the Company Optional Redemption Date. The Company shall deliver the applicable Company Optional Redemption Price
to each Holder in cash on the applicable Company Optional Redemption Date. Notwithstanding anything herein to the contrary, at any time
prior to the date the Company Optional Redemption Price is paid, in full, the Company Optional Redemption Amount may be converted, in
whole or in part, by any Holder into shares of Common Stock pursuant to Section 4. All Conversion Amounts converted by a Holder after
the Company Optional Redemption Notice Date shall reduce the Company Optional Redemption Amount of the Preferred Shares of such Holder
required to be redeemed on the Company Optional Redemption Date. In the event of the Company’s redemption of any of the Preferred
Shares under this Section 9, a 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 such Holder.
Accordingly, any redemption premium due under this Section 9 is intended by the parties to be, and shall be deemed, a reasonable estimate
of such Holder’s actual loss of its investment opportunity and not as a penalty. For the avoidance of doubt, the Company shall
have no right to effect a Company Optional Redemption if any Triggering Event has occurred and continuing, but any Triggering Event shall
have no effect upon any Holder’s right to convert Preferred Shares in its discretion.
10.
Noncircumvention. The Company hereby covenants and agrees that
the Company will not, by amendment of its Certificate of Incorporation, 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 Certificate of Designations, and will at all times in good faith carry out all the provisions
of this Certificate of Designations and take all action as may be required to protect the rights of the Holders hereunder. Without limiting
the generality of the foregoing or any other provision of this Certificate of Designations or the other Transaction Documents, the Company
(a) shall not increase the par value of any shares of Common Stock receivable upon the conversion of any Preferred Shares above the Conversion
Price then in effect, (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 conversion of Preferred Shares and (c) shall, so long as any Preferred
Shares are outstanding, take all action necessary to reserve and keep available out of its authorized and unissued shares of Common Stock,
solely for the purpose of effecting the conversion of the Preferred Shares, the maximum number of shares of Common Stock as shall from
time to time be necessary to effect the conversion of the Preferred Shares then outstanding (without regard to any limitations on conversion
contained herein). Notwithstanding anything herein to the contrary, if after the sixty (60) calendar day anniversary of the Initial Issuance
Date, each Holder is not permitted to convert such Holder’s Preferred Shares in full for any reason (other than pursuant to restrictions
set forth in Section 4(d) hereof), the Company shall use its best efforts to promptly remedy such failure, including, without limitation,
obtaining such consents or approvals as necessary to effect such conversion into shares of Common Stock.
11.
Authorized Shares.
(a)
Reservation. So long as any Preferred Shares remain outstanding, the Company shall at all times reserve at least (x) if prior
to May 31, 2023 (or, if earlier, the Stockholder Approval Date (as defined in the Exchange Agreement)) (the “Initial Reserve
Expiration Date”), 6.5 million shares of Common Stock or (y) from and after the Initial Reserve Expiration Date, 200% of the
number of shares of Common Stock as shall from time to time be necessary to effect the conversion, including without limitation, Alternate
Conversions, of all of the Preferred Shares then outstanding at the Alternate Conversion Price then in effect (without regard to any
limitations on conversions) (the “Required Reserve Amount”). The Required Reserve Amount (including, without limitation,
each increase in the number of shares so reserved) shall be allocated pro rata among the Holders based on the number of the Preferred
Shares held by each Holder on the Initial Issuance Date 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 Preferred Shares,
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 Preferred Shares shall be allocated to the remaining Holders of Preferred
Shares, pro rata based on the number of the Preferred Shares then held by the Holders. Notwithstanding the foregoing, a Holder may allocate
its Authorized Share Allocation to any other of the securities of the Company held by such Holder (or any of its designees) by delivery
of a written notice to the Company.
(b)
Insufficient Authorized Shares. If, notwithstanding Section 11(a) and not in limitation thereof, at any time while any of the
Preferred Shares remain outstanding the Company does not have a sufficient number of authorized and unreserved shares of Common Stock
to satisfy its obligation to reserve for issuance upon conversion of the Preferred Shares at least a number of shares of Common Stock
equal to 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 the Preferred Shares then outstanding (or deemed outstanding pursuant to Section 11(a) above). 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 (or, if a majority of the voting power then in effect of the capital stock of the Company consents to such increase,
in lieu of such proxy statement, deliver to the stockholders of the Company an information statement that has been filed with (and either
approved by or not subject to comments from) the SEC with respect thereto). 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 to a Holder upon any conversion 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 “Authorized
Failure Shares”), in lieu of delivering such Authorized Failure Shares to such Holder, the Company shall pay cash in exchange
for the redemption of such portion of the Conversion Amount of the Preferred Shares convertible into such Authorized Failure Shares at
a price equal to the sum of (i) the product of (x) such number of Authorized Failure Shares and (y) the greatest Closing Sale Price of
the Common Stock on any Trading Day during the period commencing on the date such Holder delivers the applicable Conversion Notice with
respect to such Authorized Failure Shares to the Company and ending on the date of such issuance and payment under this Section 11(b);
and (ii) to the extent such Holder purchases (in an open market transaction or otherwise) shares of Common Stock to deliver in satisfaction
of a sale by such Holder of Authorized Failure Shares, any brokerage commissions and other out-of-pocket expenses, if any, of such Holder
incurred in connection therewith.
12.
Voting Rights. The holders of the Preferred Shares shall have
no voting power and no right to vote on any matter at any time, either as a separate series or class or together with any other series
or class of share of capital stock, and shall not be entitled to call a meeting of such holders for any purpose nor shall they be entitled
to participate in any meeting of the holders of Common Stock, except as provided in this Section 12 and Section 16 or as otherwise required
by the DGCL. To the extent that under the DGCL the vote of the holders of the Preferred Shares, voting separately as a class or series,
as applicable, is required to authorize a given action of the Company, the affirmative vote or consent of the Required Holders of the
Preferred Shares, voting together in the aggregate and not in separate series unless required under the DGCL, represented at a duly held
meeting at which a quorum is presented or by written consent of the Required Holders (except as otherwise may be required under the DGCL),
voting together in the aggregate and not in separate series unless required under the DGCL, shall constitute the approval of such action
by both the class or the series, as applicable. Holders of the Preferred Shares shall be entitled to written notice of all stockholder
meetings or written consents (and copies of proxy materials and other information sent to stockholders) with respect to which they would
be entitled to vote, which notice would be provided pursuant to the Company’s bylaws (the “Bylaws”) and the
DGCL.
13.
Covenants.
(a)
Restriction on Redemption and Cash Dividends. The Company shall not, and the Company shall cause each of its Subsidiaries to not,
directly or indirectly, redeem, repurchase or declare or pay any cash dividend or distribution on any of its capital stock (other than
as required by this Certificate of Designations).
(b)
Restriction on Transfer of Assets. The Company shall not, and the Company shall cause each of its Subsidiaries to not, directly
or indirectly, sell, lease, license, assign, transfer, spin-off, split-off, close, convey or otherwise dispose of any assets or rights
of the Company or any Subsidiary owned or hereafter acquired whether in a single transaction or a series of related transactions, other
than (i) sales, leases, licenses, assignments, transfers, conveyances and other dispositions of such assets or rights by the Company
and its Subsidiaries in the ordinary course of business consistent with its past practice and (ii) sales of inventory and product in
the ordinary course of business.
(c)
Change in Nature of Business. The Company shall not, and the Company shall cause each of its Subsidiaries to not, directly or
indirectly, engage in any material line of business substantially different from those lines of business conducted by or publicly contemplated
to be conducted by the Company and each of its Subsidiaries on the Exchange Agreement Effective Date or any business substantially related
or incidental thereto. The Company shall not, and the Company shall cause each of its Subsidiaries to not, directly or indirectly, modify
its or their corporate structure or purpose.
(d)
Preservation of Existence, Etc. The Company shall maintain and preserve, and cause each of its Subsidiaries to maintain and preserve,
its existence, rights and privileges, and become or remain, and cause each of its Subsidiaries to 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.
(e)
Maintenance of Properties, Etc. The Company shall maintain and preserve, and cause each of its Subsidiaries to 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, and cause each of its Subsidiaries to 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.
(f)
Maintenance of Intellectual Property. The Company will, and will cause each of its Subsidiaries to, take all action necessary
or advisable to maintain all of the Intellectual Property Rights of the Company and/or any of its Subsidiaries that are necessary or
material to the conduct of its business in full force and effect.
(g)
Maintenance of Insurance. The Company shall maintain, and cause each of its Subsidiaries to 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.
(h)
Transactions with Affiliates. The Company shall not, nor shall it permit any of its Subsidiaries to, enter into, renew, extend
or be a party to, any transaction or series of related transactions (including, without limitation, the purchase, sale, lease, transfer
or exchange of property or assets of any kind or the rendering of services of any kind) with any affiliate, except transactions 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.
(i)
Restricted Issuances. The Company shall not, directly or indirectly, without the prior written consent of the Required Holders,
(i) issue any Preferred Shares (other than as contemplated by the Exchange Agreements and this Certificate of Designations), or (ii)
issue any other securities that would cause a breach or default under this Certificate of Designations.
(j) Stay,
Extension and Usury Laws. To the extent that it may lawfully do so, the Company (A) agrees that it will not at any time insist
upon, plead, or in any manner whatsoever claim or take the benefit or advantage of, any stay, extension or usury law (wherever or
whenever enacted or in force) that may affect the covenants or the performance of this Certificate of Designations; and (B)
expressly waives all benefits or advantages of any such law and agrees that it will not, by resort to any such law, hinder, delay or
impede the execution of any power granted to the Holders by this Certificate of Designations, but will suffer and permit the
execution of every such power as though no such law has been enacted.
(k)
Taxes. The Company and its Subsidiaries shall pay when due all taxes, fees or other charges of any nature whatsoever (together
with any related interest or penalties) now or hereafter imposed or assessed against the Company and its Subsidiaries or their respective
assets or upon their ownership, possession, use, operation or disposition thereof or upon their rents, receipts or earnings arising therefrom
(except where the failure to pay would not, individually or in the aggregate, have a material effect on the Company or any of its Subsidiaries).
The Company and its Subsidiaries shall file on or before the due date therefor all personal property tax returns (except where the failure
to file would not, individually or in the aggregate, have a material effect on the Company or any of its Subsidiaries). Notwithstanding
the foregoing, the Company and its Subsidiaries may contest, in good faith and by appropriate proceedings, taxes for which they maintain
adequate reserves therefor in accordance with GAAP.
(l)
PCAOB Registered Auditor. At all times any Preferred Shares remain outstanding, the Company shall have engaged an independent
auditor to audit its financial statements that is registered with (and in compliance with the rules and regulations of) the Public Company
Accounting Oversight Board.
(m)
Independent Investigation. At the request of any Holder either (x) at any time when a Triggering Event has occurred and is continuing,
(y) upon the occurrence of an event that with the passage of time or giving of notice would constitute a Triggering Event or (z) at any
time such Holder reasonably believes a Triggering Event may have occurred or be continuing, the Company shall hire an independent, reputable
investment bank selected by the Company and approved by such Holder to investigate as to whether any breach of this Certificate of Designations
has occurred (the “Independent Investigator”). If the Independent Investigator determines that such breach of this
Certificate of Designations has occurred, the Independent Investigator shall notify the Company of such breach and the Company shall
deliver written notice to each Holder of such breach. In connection with such investigation, the Independent Investigator may, during
normal business hours, inspect all contracts, books, records, personnel, offices and other facilities and properties of the Company and
its Subsidiaries and, to the extent available to the Company after the Company uses reasonable efforts to obtain them, the records of
its legal advisors and accountants (including the accountants’ work papers) and any books of account, records, reports and other
papers not contractually required of the Company to be confidential or secret, or subject to attorney-client or other evidentiary privilege,
and the Independent Investigator may make such copies and inspections thereof as the Independent Investigator may reasonably request.
The Company shall furnish the Independent Investigator with such financial and operating data and other information with respect to the
business and properties of the Company as the Independent Investigator may reasonably request. The Company shall permit the Independent
Investigator to discuss the affairs, finances and accounts of the Company with, and to make proposals and furnish advice with respect
thereto to, the Company’s officers, directors, key employees and independent public accountants or any of them (and by this provision
the Company authorizes said accountants to discuss with such Independent Investigator the finances and affairs of the Company and any
Subsidiaries), all at such reasonable times, upon reasonable notice, and as often as may be reasonably requested.
14.
Liquidation, Dissolution, Winding-Up. In the event of a Liquidation
Event, the Holders shall be entitled to receive in cash out of the assets of the Company, whether from capital or from earnings available
for distribution to its stockholders (the “Liquidation Funds”), before any amount shall be paid to the holders of
any of shares of Junior Stock, after any Senior Preferred Stock then outstanding, but pari passu with any Parity Stock then outstanding,
an amount per Preferred Share equal to the greater of (A) 125% of the Conversion Amount of such Preferred Share on the date of such payment
and (B) the amount per share such Holder would receive if such Holder converted such Preferred Share into Common Stock (at the Alternate
Conversion Price then in effect) immediately prior to the date of such payment, provided that if the Liquidation Funds are insufficient
to pay the full amount due to the Holders and holders of shares of Parity Stock, then each Holder and each holder of Parity Stock shall
receive a percentage of the Liquidation Funds equal to the full amount of Liquidation Funds payable to such Holder and such holder of
Parity Stock as a liquidation preference, in accordance with their respective certificate of designations (or equivalent), as a percentage
of the full amount of Liquidation Funds payable to all holders of Preferred Shares and all holders of shares of Parity Stock. To the
extent necessary, the Company shall cause such actions to be taken by each of its Subsidiaries so as to enable, to the maximum extent
permitted by law, the proceeds of a Liquidation Event to be distributed to the Holders in accordance with this Section 14. All the preferential
amounts to be paid to the Holders under this Section 14 shall be paid or set apart for payment before the payment or setting apart for
payment of any amount for, or the distribution of any Liquidation Funds of the Company to the holders of shares of Junior Stock in connection
with a Liquidation Event as to which this Section 14 applies.
15.
Distribution of Assets. In addition to any adjustments pursuant
to Section 7 and Section 8, if the Company shall declare or make any dividend or other distributions of its assets (or rights to acquire
its assets) to any or all holders of shares of Common Stock, by way of return of capital or otherwise (including without limitation,
any distribution of cash, stock or other securities, property or options by way of a dividend, spin off, reclassification, corporate
rearrangement, scheme of arrangement or other similar transaction) (the “Distributions”), then each Holder, as holders
of Preferred Shares, will be entitled to such Distributions as if such Holder had held the number of shares of Common Stock acquirable
upon complete conversion of the Preferred Shares (without taking into account any limitations or restrictions on the convertibility of
the Preferred Shares and assuming for such purpose that the Preferred Share was converted at the Alternate Conversion Price as of the
applicable record date) immediately prior to 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 Common Stock are to be determined for such Distributions (provided, however,
that to the extent that such Holder’s right to participate in any such Distribution would result in such Holder and the other Attribution
Parties exceeding the Maximum Percentage, then such Holder shall not be entitled to participate in such Distribution to such 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 such extent of any such excess) and the portion of such Distribution shall be held in abeyance for the
benefit of such Holder until such time or times as its right thereto would not result in such Holder and the other Attribution Parties
exceeding the Maximum Percentage, at which time or times, if any, such 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).
16.
Vote to Change the Terms of or Issue Preferred Shares. In addition
to any other rights provided by law, except where the vote or written consent of the holders of a greater number of shares is required
by law or by another provision of the Certificate of Incorporation, without first obtaining the affirmative vote at a meeting duly called
for such purpose or the written consent without a meeting of the Required Holders, voting together as a single class, the Company shall
not: (a) amend or repeal any provision of, or add any provision to, its certificate of Incorporation or bylaws, or file any certificate
of designations or articles of amendment of any series of shares of preferred stock, if such action would adversely alter or change in
any respect the preferences, rights, privileges or powers, or restrictions provided for the benefit of the Preferred Shares hereunder,
regardless of whether any such action shall be by means of amendment to the Certificate of Incorporation or by merger, consolidation
or otherwise; (b) increase or decrease (other than by conversion) the authorized number of shares of Series A-1 Convertible Preferred
Stock; (c) without limiting any provision of Section 2, create or authorize (by reclassification or otherwise) any new class or series
of Senior Preferred Stock or Parity Stock, other than any Merger Senior Preferred Stock to be issued pursuant to the transactions contemplated
by the Merger Agreement, any Parity Stock to be issued pursuant to the transactions contemplated by the Merger Agreement and any Merger
Parity Stock; (d) purchase, repurchase or redeem any shares of Junior Stock (other than pursuant to the terms of the Company’s
equity incentive plans and options and other equity awards granted under such plans (that have in good faith been approved by the Board));
(e) without limiting any provision of Section 2, pay dividends or make any other distribution on any shares of any Junior Stock; (f)
issue any Preferred Shares other than as contemplated hereby or pursuant to the Exchange Agreements or the Merger Agreement; or (g) without
limiting any provision of Section 10, whether or not prohibited by the terms of the Preferred Shares, circumvent a right of the Preferred
Shares hereunder.
17.
Transfer of Preferred Shares. A Holder may offer, sell or transfer
some or all of its Preferred Shares without the consent of the Company subject only to the provisions of Section 5 of the Exchange Agreements.
18.
Reissuance of Preferred Share Certificates and Book Entries.
(a)
Transfer. If any Preferred Shares are to be transferred, the applicable Holder shall surrender the applicable Preferred Share
Certificate to the Company (or, if the Preferred Shares are held in Book-Entry form, a written instruction letter to the Company), whereupon
the Company will forthwith issue and deliver upon the order of such Holder a new Preferred Share Certificate (in accordance with Section
18(d)) (or evidence of the transfer of such Book-Entry), registered as such Holder may request, representing the outstanding number of
Preferred Shares being transferred by such Holder and, if less than the entire outstanding number of Preferred Shares is being transferred,
a new Preferred Share Certificate (in accordance with Section 18(d)) to such Holder representing the outstanding number of Preferred
Shares not being transferred (or evidence of such remaining Preferred Shares in a Book-Entry for such Holder). Such Holder and any assignee,
by acceptance of the Preferred Share Certificate or evidence of Book-Entry issuance, as applicable, acknowledge and agree that, by reason
of the provisions of Section 4(c)(i) following conversion or redemption of any of the Preferred Shares, the outstanding number of Preferred
Shares represented by the Preferred Shares may be less than the number of Preferred Shares stated on the face of the Preferred Shares.
(b)
Lost, Stolen or Mutilated Preferred Share Certificate. Upon receipt by the Company of evidence reasonably satisfactory to the
Company of the loss, theft, destruction or mutilation of a Preferred Share Certificate (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 applicable Holder to the Company in customary and reasonable form and, in the case of mutilation, upon surrender and cancellation
of such Preferred Share Certificate, the Company shall execute and deliver to such Holder a new Preferred Share Certificate (in accordance
with Section 18(d)) representing the applicable outstanding number of Preferred Shares.
(c)
Preferred Share Certificate and Book-Entries Exchangeable for Different Denominations and Forms. Each Preferred Share Certificate
is exchangeable, upon the surrender hereof by the applicable Holder at the principal office of the Company, for a new Preferred Share
Certificate or Preferred Share Certificate(s) or new Book-Entry (in accordance with Section 18(d)) representing, in the aggregate, the
outstanding number of the Preferred Shares in the original Preferred Share Certificate, and each such new Preferred Share Certificate
and/or new Book-Entry, as applicable, will represent such portion of such outstanding number of Preferred Shares from the original Preferred
Share Certificate as is designated in writing by such Holder at the time of such surrender. Each Book-Entry may be exchanged into one
or more new Preferred Share Certificates or split by the applicable Holder by delivery of a written notice to the Company into two or
more new Book-Entries (in accordance with Section 18(d)) representing, in the aggregate, the outstanding number of the Preferred Shares
in the original Book-Entry, and each such new Book-Entry and/or new Preferred Share Certificate, as applicable, will represent such portion
of such outstanding number of Preferred Shares from the original Book-Entry as is designated in writing by such Holder at the time of
such surrender.
(d)
Issuance of New Preferred Share Certificate or Book-Entry. Whenever the Company is required to issue a new Preferred Share Certificate
or a new Book-Entry pursuant to the terms of this Certificate of Designations, such new Preferred Share Certificate or new Book-Entry
(i) shall represent, as indicated on the face of such Preferred Share Certificate or in such Book-Entry, as applicable, the number of
Preferred Shares remaining outstanding (or in the case of a new Preferred Share Certificate or new Book-Entry being issued pursuant to
Section 18(a) or Section 18(c), the number of Preferred Shares designated by such Holder) which, when added to the number of Preferred
Shares represented by the other new Preferred Share Certificates or other new Book-Entry, as applicable, issued in connection with such
issuance, does not exceed the number of Preferred Shares remaining outstanding under the original Preferred Share Certificate or original
Book-Entry, as applicable, immediately prior to such issuance of new Preferred Share Certificate or new Book-Entry, as applicable, and
(ii) shall have an issuance date, as indicated on the face of such new Preferred Share Certificate or in such new Book-Entry, as applicable,
which is the same as the issuance date of the original Preferred Share Certificate or in such original Book-Entry, as applicable.
19.
Remedies, Characterizations, Other Obligations, Breaches and Injunctive
Relief. The remedies provided in this Certificate of Designations shall be cumulative and in addition to all other remedies available
under this Certificate of Designations and any of the other Transaction Documents, at law or in equity (including a decree of specific
performance and/or other injunctive relief), and nothing herein shall limit any Holder’s right to pursue actual and consequential
damages for any failure by the Company to comply with the terms of this Certificate of Designations. No failure on the part of a Holder
to exercise, and no delay in exercising, any right, power or remedy hereunder shall operate as a waiver thereof; nor shall any single
or partial exercise by such Holder of any right, power or remedy preclude any other or further exercise thereof or the exercise of any
other right, power or remedy. In addition, the exercise of any right or remedy of a Holder at law or equity or under this Certificate
of Designations or any of the documents shall not be deemed to be an election of such Holder’s rights or remedies under such documents
or at law or equity. The Company covenants to each Holder that there shall be no characterization concerning this instrument other than
as expressly provided herein. Amounts set forth or provided for herein with respect to payments, conversion and the like (and the computation
thereof) shall be the amounts to be received by a Holder and shall not, except as expressly provided herein, be subject to any other
obligation of the Company (or the performance thereof). No failure on the part of a Holder to exercise, and no delay in exercising, any
right, power or remedy hereunder shall operate as a waiver thereof; nor shall any single or partial exercise by such Holder of any right,
power or remedy preclude any other or further exercise thereof or the exercise of any other right, power or remedy. In addition, the
exercise of any right or remedy of any Holder at law or equity or under Preferred Shares or any of the documents shall not be deemed
to be an election of such Holder’s rights or remedies under such documents or at law or equity. The Company acknowledges that a
breach by it of its obligations hereunder will cause irreparable harm to the Holders 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, each Holder 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 a Holder that is requested by such Holder
to enable such Holder to confirm the Company’s compliance with the terms and conditions of this Certificate of Designations.
20.
Payment of Collection, Enforcement and Other Costs. If (a) any
Preferred Shares are placed in the hands of an attorney for collection or enforcement or is collected or enforced through any legal proceeding
or a Holder otherwise takes action to collect amounts due under this Certificate of Designations with respect to the Preferred Shares
or to enforce the provisions of this Certificate of Designations or (b) there occurs any bankruptcy, reorganization, receivership of
the Company or other proceedings affecting Company creditors’ rights and involving a claim under this Certificate of Designations,
then the Company shall pay the costs incurred by such 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. The Company
expressly acknowledges and agrees that no amounts due under this Certificate of Designations with respect to any Preferred Shares shall
be affected, or limited, by the fact that the purchase price paid for each Preferred Share was less than the original Stated Value thereof.
21.
Construction; Headings. This Certificate of Designations shall
be deemed to be jointly drafted by the Company and the Holders and shall not be construed against any such Person as the drafter hereof.
The headings of this Certificate of Designations are for convenience of reference and shall not form part of, or affect the interpretation
of, this Certificate of Designations. 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 Certificate of Designations instead of just
the provision in which they are found. Unless expressly indicated otherwise, all section references are to sections of this Certificate
of Designations. Terms used in this Certificate of Designations and not otherwise defined herein, but defined in the other Transaction
Documents, shall have the meanings ascribed to such terms on the Initial Issuance Date in such other Transaction Documents unless otherwise
consented to in writing by the Required Holders.
22.
Failure or Indulgence Not Waiver. No failure or delay on the part
of a 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. This Certificate
of Designations shall be deemed to be jointly drafted by the Company and all Holders and shall not be construed against any Person as
the drafter hereof. Notwithstanding the foregoing, nothing contained in this Section 22 shall permit any waiver of any provision of Section
4(d).
23.
Dispute Resolution.
(a)
Submission to Dispute Resolution.
(i)
In the case of a dispute relating to a Closing Bid Price, a Closing Sale Price, a Conversion Price, an Alternate Conversion Price, a
VWAP or a fair market value or the arithmetic calculation of a Conversion Rate, or the applicable redemption price (as the case may be)
(including, without limitation, a dispute relating to the determination of any of the foregoing), the Company or the applicable Holder
(as the case may be) shall submit the dispute to the other party via electronic mail (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 such Holder at any time after such Holder learned
of the circumstances giving rise to such dispute. If such Holder and the Company are unable to promptly resolve such dispute relating
to such Closing Bid Price, such Closing Sale Price, such Conversion Price, such Alternate Conversion Price, such VWAP or such fair market
value, or the arithmetic calculation of such Conversion Rate or such applicable redemption price (as the case may be), at any time after
the second (2nd) Business Day following such initial notice by the Company or such Holder (as the case may be) of such dispute
to the Company or such Holder (as the case may be), then such Holder may, at its sole option, select an independent, reputable investment
bank to resolve such dispute.
(ii)
Such 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 23 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 such
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 such 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 such
Holder or otherwise requested by such investment bank, neither the Company nor such 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 such Holder shall cause such investment bank to determine the resolution of such dispute and notify the Company and such
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 23 constitutes an agreement to arbitrate between
the Company and each Holder (and constitutes an arbitration agreement) under the rules then in effect under Delaware Rapid Arbitration
Act, as amended, (ii) the terms of this Certificate of Designations 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 and in resolving such dispute such investment bank shall apply
such findings, determinations and the like to the terms of this Certificate of Designations and any other applicable Transaction Documents,
(iii) the applicable Holder (and only such Holder with respect to disputes solely relating to such Holder), in its sole discretion, shall
have the right to submit any dispute described in this Section 23 to any state or federal court sitting in Wilmington Delaware, in lieu
of utilizing the procedures set forth in this Section 23 and (iv) nothing in this Section 23 shall limit such Holder from obtaining any
injunctive relief or other equitable remedies (including, without limitation, with respect to any matters described in this Section 23).
24.
Notices; Currency; Payments.
(a)
Any notices, consents, waivers or other communications required or permitted to be given under the terms of this Certificate of Designations
must be in writing and will be deemed to have been delivered on the earliest of: (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 address and e-mail address for any
such communications to the Company shall be: Aditxt, Inc., 737 N. Fifth Street, Suite 200, Richmond, VA 23219, Attention: Amro Albanna,
e-mail address: aalbanna@aditxt.com, or such other mailing address and/or e-mail address as the Company has specified by written notice
given to each of the Holders in accordance with this Section 24(a) not later than five (5) days prior to the effectiveness of such change.
The mailing address and e-mail address for any such communications to any Holder shall be as set forth on such Holder’s respective
signature page to the Purchase Agreement, or such other mailing address and/or e-mail address as such Holder has specified by written
notice given to the Company in accordance with this Section 24(a) not later than 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 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.
(b)
The Company shall provide each Holder with prompt written notice of all actions taken pursuant to this Certificate of Designations, including
in reasonable detail a description of such action and the reason therefore. Without limiting the generality of the foregoing, the Company
shall give written notice to each Holder (i) immediately upon any adjustment of the Conversion Price, setting forth in reasonable detail,
and certifying, the calculation of such adjustment 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 Common Stock, or (B) 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 such Holder.
(c) Currency.
All dollar amounts referred to in this Certificate of Designations are in United States Dollars (“U.S. Dollars”),
and all amounts owing under this Certificate of Designations 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 Certificate of Designations, the U.S. Dollar exchange rate as published in the Wall Street Journal on the relevant
date of calculation (it being understood and agreed that where an amount is calculated with reference to, or over, a period of time,
the date of calculation shall be the final date of such period of time).
(d)
Payments. Whenever any payment of cash is to be made by the Company to any Person pursuant to this Certificate of Designations,
unless otherwise expressly set forth herein, such payment shall be made in lawful money of the United States of America by wire transfer
of immediately available funds pursuant to wire transfer instructions that Holder shall provide to the Company in writing from time to
time. Whenever any amount expressed to be due by the terms of this Certificate of Designations 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.
Waiver of Notice. To the extent permitted by law, the Company
hereby irrevocably waives demand, notice, presentment, protest and all other demands and notices in connection with the delivery, acceptance,
performance, default or enforcement of this Certificate of Designations and the Exchange Agreements.
26.
Governing Law. This Certificate of Designations shall be construed
and enforced in accordance with, and all questions concerning the construction, validity, interpretation and performance of this Certificate
of Designations shall be governed by, the internal laws of the State of Delaware, without giving effect to any choice of law or conflict
of law provision or rule (whether of the State of Delaware or any other jurisdictions) that would cause the application of the laws of
any jurisdictions other than the State of Delaware. Except as otherwise required by Section 23 above, the Company hereby irrevocably
submits to the exclusive jurisdiction of the state and federal courts sitting in Wilmington, Delaware, 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 to limit in any way any right to serve process in any manner permitted by law. Nothing contained herein (i) shall
be deemed or operate to preclude any Holder from bringing suit or taking other legal action against the Company in any other jurisdiction
to collect on the Company’s obligations to such 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 such Holder or (ii) shall limit, or shall be deemed or construed to limit,
any provision of Section 23 above. 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 CERTIFICATE OF DESIGNATIONS OR ANY TRANSACTION
CONTEMPLATED HEREBY.
27.
Judgment Currency.
(a)
If for the purpose of obtaining or enforcing judgment against the Company in any court in any jurisdiction it becomes necessary to convert
into any other currency (such other currency being hereinafter in this Section 27 referred to as the “Judgment Currency”)
an amount due in U.S. Dollars under this Certificate of Designations, the conversion shall be made at the Exchange Rate prevailing on
the Trading Day immediately preceding:
(i)
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
(ii)
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 27(a)(ii) being hereinafter referred to as the “Judgment Conversion Date”).
(b)
If in the case of any proceeding in the court of any jurisdiction referred to in Section 27(a)(ii) 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.
(c)
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 Certificate of Designations.
28.
TAXES.
(a)
All payments made by the Company hereunder or under any other Transaction Document shall be made in accordance with the terms of the
respective Transaction Document and shall be made without set-off, counterclaim, withholding, deduction or other defense. Without limiting
the foregoing, all such payments shall be made free and clear of and without deduction or withholding for any present or future taxes,
levies, imposts, deductions, charges or withholdings, and all liabilities with respect thereto, excluding (i) taxes imposed on the net
income of a Holder by the jurisdiction in which such Holder is organized or where it has its principal lending office, (ii) with respect
to any payments made by the Company hereunder, taxes (including, but not limited to, backup withholding) to the extent such taxes are
imposed due to the failure of the applicable recipient of such payment to provide the Company with whichever (if any) is applicable of
valid and properly completed and executed IRS Forms W-9, W-8BEN, W-8BEN-E, W-8ECI, and/or W-8IMY, when requested in writing by the Company,
and (iii) with respect to any payments made by the Company, taxes to the extent such taxes are imposed due to the failure of the applicable
recipient of such payment to comply with FATCA (all such nonexcluded taxes, levies, imposts, deductions, charges, withholdings and liabilities,
collectively or individually, “Taxes”). If the Company shall be required to deduct or to withhold any Taxes from or
in respect of any amount payable hereunder or under any other Transaction Document:
(i)
the amount so payable shall be increased to the extent necessary so that after making all required deductions and withholdings (including
Taxes on amounts payable to a Holder pursuant to this sentence) such Holder receives an amount equal to the sum it would have received
had no such deduction or withholding been made,
(ii)
the Company shall make such deduction or withholding,
(iii)
the Company shall pay the full amount deducted or withheld to the relevant Governmental Authority in accordance with applicable law,
and
(iv)
as promptly as possible thereafter, the Company shall send such Holder an official receipt (or, if an official receipt is not available,
such other documentation as shall be satisfactory to such Holder, as the case may be) showing payment. In addition, the Company agrees
to pay any present or future stamp or documentary taxes or any other excise or property taxes, charges or similar levies that arise from
any payment made hereunder or from the execution, delivery, registration or enforcement of, or otherwise with respect to, this Preferred
Shares or any other Transaction Document (collectively, “Other Taxes”).
(b)
The Company hereby indemnifies and agrees to hold each Holder and each of their affiliates and their respective officers, directors,
employees, agents and advisors (each, an “Indemnified Party”) each Indemnified Party harmless from and against Taxes
or Other Taxes (including, without limitation, any Taxes or Other Taxes imposed by any jurisdiction on amounts payable under this Section
28) paid by any Indemnified Party as a result of any payment made hereunder or from the execution, delivery, registration or enforcement
of, or otherwise with respect to, this Preferred Shares or any other Transaction Document, and any liability (including penalties, interest
and expenses for nonpayment, late payment or otherwise) arising therefrom or with respect thereto, whether or not such Taxes or Other
Taxes were correctly or legally asserted. This indemnification shall be paid within thirty (30) days from the date on which such Holder
makes written demand therefor, which demand shall identify the nature and amount of such Taxes or Other Taxes.
(c)
If the Company fails to perform any of its obligations under this Section 28, the Company shall indemnify such Holder for any taxes,
interest or penalties that may become payable as a result of any such failure. The obligations of the Company under this Section 28 shall
survive the repayment and/or conversion, as applicable, in full of the Preferred Shares and all other amounts payable with respect thereto.
(d)
If any Indemnified Party determines, in its sole discretion exercised in good faith, that it has received a refund of any Taxes as to
which it has been indemnified pursuant to this Section 28 (including by the payment of additional amounts pursuant to this Section 28),
it shall pay to the indemnifying party an amount equal to such refund (but only to the extent of indemnity payments made under this Section
28 with respect to the Taxes giving rise to such refund), net of all out-of-pocket expenses (including taxes) of such Indemnified Party
and without interest (other than any interest paid by the relevant Governmental Authority with respect to such refund). Such indemnifying
party, upon the request of such Indemnified Party, shall repay to such Indemnified Party the amount paid over pursuant to this paragraph
(d) (plus any penalties, interest, or other charges imposed by the relevant Governmental Authority) in the event that such Indemnified
Party is required to repay such refund to such Governmental Authority. Notwithstanding anything to the contrary in this paragraph (d),
in no event will the Indemnified Party be required to pay any amount to an indemnifying party pursuant to this paragraph (d) the payment
of which would place the Indemnified Party in a less favorable net after-Tax position than the Indemnified Party would have been in if
the Tax subject to indemnification and giving rise to such refund had not been deducted, withheld or otherwise imposed and the indemnification
payments or additional amounts with respect to such Tax had never been paid. This paragraph (d) shall not be construed to require any
Indemnified Party to make available its Tax returns (or any other information relating to its Taxes that it deems confidential) to the
indemnifying party or any other Person.
29.
Severability. If any provision of this Certificate of Designations
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 Certificate of Designations so long as this Certificate of Designations 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).
30.
Maximum Payments. Nothing contained herein shall be deemed to
establish or require the payment of a rate of interest or other charges in excess of the maximum permitted by applicable law. In the
event that the rate of interest required to be paid or other charges hereunder exceed the maximum permitted by such law, any payments
in excess of such maximum shall be credited against amounts owed by the Company to the applicable Holder and thus refunded to the Company.
31.
Stockholder Matters; Amendment; Transactions Related to the Merger
Agreement, and Other Acquisitions or Strategic Tramsactions.
(a)
Stockholder Matters. Any stockholder action, approval or consent required, desired or otherwise sought by the Company pursuant
to the DGCL, the Certificate of Incorporation, this Certificate of Designations or otherwise with respect to the issuance of Preferred
Shares may be effected by written consent of the Company’s stockholders or at a duly called meeting of the Company’s stockholders,
all in accordance with the applicable rules and regulations of the DGCL. This provision is intended to comply with the applicable sections
of the DGCL permitting stockholder action, approval and consent affected by written consent in lieu of a meeting.
(b)
Amendment. Except for Section 4(d), which may not be amended or waived hereunder, this Certificate of Designations or any provision
hereof may be amended by obtaining the affirmative vote at a meeting duly called for such purpose, or written consent without a meeting
in accordance with the DGCL, of the Required Holders, voting separate as a single class, and with such other stockholder approval, if
any, as may then be required pursuant to the DGCL and the Certificate of Incorporation. Except
(a) to the extent otherwise expressly provided in this Certificate of Designations or the Certificate of Incorporation with respect
to voting or approval rights of a particular class or series of capital stock or (b) to the extent otherwise provided pursuant to
the DGCL, the holders of each outstanding class or series of shares of the Company shall not be entitled to vote as a separate voting
group on any amendment to the terms of this Certificate of Designations with respect to which such class or series would otherwise be
entitled under the DGCL to vote as a separate voting group
(c)
Transactions Related to the Merger Agreement and Other Acquisitions or Strategic Transactions.
Notwithstanding the foregoing, nothing herein shall restrict or otherwise prohibit any term or condition of the Merger Agreement,
any agreement resulting in the issuance of Merger Parity Stock, or the transactions contemplated thereby, including without limitation,
the filing of one or more certificates of designations with any secretary of state with respect thereto and the issuance of the Merger
Senior Preferred Stock and/or Parity Stock, as applicable, in accordance therewith.
32.
Certain Defined Terms. For purposes of this Certificate of Designations,
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)
“Additional Amount” means, as of the applicable date of determination, with respect to each Preferred Share, all declared
and unpaid Dividends on such Preferred Share.
(d)
“Adjustment Measurement Commencement Date” means January 1, 2023.
(e)
“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 8(a)) of shares of Common Stock (other than rights of
the type described in Section 7(a) 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).
(f)
“Affiliate” or “Affiliated” 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.
(g)
“Alternate Conversion Floor Amount” means an amount equal to the product obtained by multiplying (A) the higher of
(I) the highest price that the Common Stock trades at on the Trading Day immediately preceding the relevant Alternate Conversion Date
and (II) the applicable Alternate Conversion Price and (B) the difference obtained by subtracting (I) the number of shares of Common
Stock delivered (or to be delivered) to such Holder on the applicable Share Delivery Deadline with respect to such Alternate Conversion
from (II) the quotient obtained by dividing (x) the applicable Conversion Amount that such Holder has elected to be the subject of the
applicable Alternate Conversion, by (y) the applicable Alternate Conversion Price without giving effect to clause (x) of such definition.
(h)
“Alternate Conversion Price” means, with respect to any Alternate Conversion that price which shall be the lowest
of (i) the applicable Conversion Price as in effect on the applicable Conversion Date of the applicable Alternate Conversion, and (ii)
the greater of (x) the Floor Price and (y) 80% of the lowest VWAP of the Common Stock during the five (5) consecutive Trading Day period
ending and including the Trading Day immediately preceding the delivery or deemed delivery of the applicable Conversion Notice (such
period, the “Alternate Conversion Measuring Period”). All such determinations to be appropriately adjusted for any
stock dividend, stock split, stock combination, reclassification or similar transaction that proportionately decreases or increases the
Common Stock during such Alternate Conversion Measuring Period.
(i)
“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 shares of Common Stock issuable upon conversion
of the Preferred Shares then outstanding and (B) the date the Preferred Shares 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).
(j)
“Approved Stock Plan” means any employee benefit plan or agreement which has been approved by the Board prior to or
subsequent to the Exchange Agreements Effective Date pursuant to which shares of Common Stock and standard options to purchase Common
Stock may be issued to any employee, officer, consultant or director for services provided to the Company in their capacity as such.
(k)
“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 Initial Issuance Date, directly or indirectly
managed or advised by a Holder’s investment manager or any of its Affiliates or principals, (ii) any direct or indirect Affiliates
of such Holder or any of the foregoing, (iii) any Person acting or who could be deemed to be acting as a Group together with such 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 such 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 such Holder and all other Attribution Parties to the Maximum Percentage.
(l)
“Bloomberg” means Bloomberg, L.P.
(m)
“Book-Entry” means each entry on the Register evidencing one or more Preferred Shares held by a Holder in lieu of
a Preferred Share Certificate issuable hereunder.
(n)
[Reserved].
(o)
“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.
(p)
“Change of Control” means any Fundamental Transaction other than (i) any merger of the Company or any of its, direct
or indirect, wholly-owned Subsidiaries with or into any of the foregoing Persons, (ii) any reorganization, recapitalization or reclassification
of the shares of 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, in all material respects, the holders 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 (iii) pursuant to a migratory merger effected
solely for the purpose of changing the jurisdiction of incorporation of the Company or any of its Subsidiaries and (iv) any merger or
acquisition of any business by the Company, directly or indirectly, in which either (x) the holders of the Company’s voting power
to elect the board of directors of the Company immediately prior to such merger or acquisition continue after such merger or acquisition
to have the voting power to elect a majority of the board of directors of the Company or (y) the Company shall not, 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 (1) at least 10% of the aggregate ordinary
voting power represented by issued and outstanding Common Stock, (2) at least 10% 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 Certificate of Designations calculated
as if any shares of Common Stock held by all such Subject Entities were not outstanding, or (3) 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 elect a majority of the directors of the Board of Directors of the Company (and, in either case, a majority
of the directors on the board of directors of the Company immediately prior to such merger or acquisition continue after such merger
or acquisition to be a majority of the directors on the board of directors of the Company). Notwithstanding the foregoing, the transactions
contemplated by the Merger Agreement, or any agreement resulting in the issuance of Merger Parity Stock shall not be deemed a Change
of Control.
(q)
“Change of Control Election Price” means, with respect to any given Change of Control, such price equal to the greatest
of (i) the product of (A) the Required Premium multiplied by (B) the Conversion Amount of the Preferred Shares subject to the applicable
election, as applicable, (ii) the product of (A) the Conversion Amount of the Preferred Shares being redeemed or exchanged, as applicable,
multiplied by (B) the quotient determined by dividing (I) the greatest Closing Sale Price of the shares of Common Stock during the period
beginning on the date immediately preceding the earlier to occur of (1) the consummation of the applicable Change of Control and (2)
the public announcement of such Change of Control and ending on the date such Holder delivers the Change of Control Election Notice by
(II) the Alternate Conversion Price then in effect, and (iii) the product of (A) the Conversion Amount of the Preferred Shares being
redeemed multiplied by (B) the quotient of (I) the aggregate cash consideration and the aggregate cash value of any non-cash consideration
per share of Common Stock to be paid to such holders of the shares of Common Stock upon consummation of such Change of Control (any such
non-cash consideration constituting publicly-traded securities shall be valued at the highest of the Closing Sale Price of such securities
as of the Trading Day immediately prior to the consummation of such Change of Control, the Closing Sale Price of such securities on the
Trading Day immediately following the public announcement of such proposed Change of Control and the Closing Sale Price of such securities
on the Trading Day immediately prior to the public announcement of such proposed Change of Control) divided by (II) the Conversion Price
then in effect.
(r)
“Closing Bid Price” and “Closing Sale Price” means, for any security as of any date, the last closing
bid price and last closing trade price, respectively, 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 bid price or the closing trade price
(as the case may be) then the last bid price or last trade price, respectively, 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 closing bid price or last trade price, respectively, 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 do not apply, the last closing bid price or last trade
price, respectively, of such security in the over-the-counter market on the electronic bulletin board for such security as reported by
Bloomberg, or, if no closing bid price or last trade price, respectively, is reported for such security by Bloomberg, the average of
the bid prices, or the ask prices, respectively, 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 Bid Price or the Closing Sale Price cannot be
calculated for a security on a particular date on any of the foregoing bases, the Closing Bid Price or the Closing Sale Price (as the
case may be) of such security on such date shall be the fair market value as mutually determined by the Company and the Required Holder.
If the Company and the Required Holders 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 23. All such determinations shall be appropriately adjusted for any stock splits, stock
dividends, stock combinations, recapitalizations or other similar transactions during such period.
(s)
“Code” means the Internal Revenue Code of 1986, as amended.
(t)
“Common Stock” means (i) the Company’s shares of common stock, $0.001 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.
(u)
“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.
(v)
“Conversion Floor Price Condition” means that the relevant Alternate Conversion Price is being determined based on
clause (x) of such definitions.
(w)
“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.
(x)
“Eligible Market” means The New York Stock Exchange, the NYSE American, the Nasdaq Global Select Market, the Nasdaq
Global Market, the Nasdaq Capital Market.
(y)
[Reserved]
(z)
“Exchange Agreement” means those certain exchange agreements set forth on Schedule I attached hereto.
(aa)
“Exchange Agreements Effective Date” means December 22, 2023.
(bb)
“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 Exchange Agreements Effective Date pursuant to this clause (i) do not either (x) with respect to any issuances during
the period commencing on the Initial Issuance Date through December 31, 2023 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 Holders; (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 Holders;
and (iii) the shares of Common Stock issuable upon conversion of the Preferred Shares or otherwise pursuant to the terms of this Certificate
of Designations; provided, that the terms of this Certificate of Designations are not amended, modified or changed on or after the Exchange
Agreements Effective Date (other than antidilution adjustments pursuant to the terms thereof in effect as of the Exchange Agreements
Effective Date).
(cc)
“FATCA” means Sections 1471 through 1474 of the Code, as of the date of this Preferred Shares (or any amended or successor
version that is substantively comparable and not materially more onerous to comply with), any current or future regulations or official
interpretations thereof, any agreements entered into pursuant to Section 1471(b)(1) of the Code and any fiscal or regulatory legislation,
rules or practices adopted pursuant to any intergovernmental agreement, treaty or convention among Governmental Authorities and implementing
such Sections of the Code.
(dd)
“Floor Price” means $0.888 (as adjusted for stock splits, stock dividends, stock combinations, recapitalizations and
similar events), or, subject to the rules and regulations of the Principal Market, such lower price as the Company and the Required Holders
may agree, from time to time.
(ee)
“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 Certificate of Designations 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) 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.
(ff)
“GAAP” means United States generally accepted accounting principles, consistently applied.
(gg)
“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.
(hh)
“Governmental Authority” 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.
(ii)
“Indebtedness” means 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 United States generally accepted accounting principles consistently applied for the periods covered thereby (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 United States generally accepted accounting
principles, 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 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
(H) all Contingent Obligations in respect of indebtedness or obligations of others of the kinds referred to in clauses (A) through (G)
above.
(jj)
“Intellectual Property Rights” means, with respect to the Company and its Subsidiaries, all of their 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.
(kk)
“Liquidation Event” means, whether in a single transaction or series of transactions, the voluntary or involuntary
liquidation, dissolution or winding up of the Company or such Subsidiaries the assets of which constitute all or substantially all of
the assets of the business of the Company and its Subsidiaries, taken as a whole.
(ll)
“Market Price” means, with respect to any Adjustment Date, 80% of the quotient determined by dividing (x) the sum
of the VWAP of the Common Stock for each of the three (3) lowest Trading Days during the twenty (20) consecutive Trading Day period ending
and including the Trading Day immediately such Applicable Date, divided by (y) three (3).
(mm)
“Material Adverse Effect” means any material adverse effect on the business, properties, assets, liabilities, operations,
results of operations, condition (financial or otherwise) or prospects of the Company and its Subsidiaries, if any, individually or taken
as a whole, or on the transactions contemplated hereby or on the other Transaction Documents (as defined below), or by the agreements
and instruments to be entered into in connection therewith or on the authority or ability of the Company to perform its obligations under
the Transaction Documents.
(nn)
“Merger Agreement” means that certain Agreement and Plan of Merger, dated December 11, 2023, by and among Aditxt,
Inc., Adicure, Inc. and Evofem Biosciences, Inc., as such shall be amended, supplemented and/or restated on or after the date hereof.
(oo)
“Options” means any rights, warrants or options to subscribe for or purchase shares of Common Stock or Convertible
Securities.
(pp)
“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.
(qq)
“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.
(rr)
“Principal Market” means, as of any time of determination, the principal trading market, if any, in which the shares
of Common Stock then trade.
(ss)
“Registration Rights Agreement” means that certain registration rights agreement, dated as of the Initial Issuance
Date, by and among the Company and the initial holders of the Preferred Shares relating to, among other things, the registration of the
resale of the Common Stock issuable upon conversion of the Preferred Shares or otherwise pursuant to the terms of this Certificate of
Designations, as may be amended from time to time.
(tt)
“Required Premium” means as applicable (i) 150% with respect to an Alternate Conversion pursuant to clause 5(a)(xvi)
above or (ii) otherwise, 125%.
(uu)
“SEC” means the United States Securities and Exchange Commission or the successor thereto.
(vv)
“Securities” means the Preferred Shares and the Conversion Shares.
(ww)
“Stated Value” shall mean $1,000 per share, subject to adjustment for stock splits, stock dividends, recapitalizations,
reorganizations, reclassifications, combinations, subdivisions or other similar events occurring after the Initial Issuance Date with
respect to the Preferred Shares.
(xx)
“Stock Combination Event” means the occurrence at any time and from time to time on or after the Exchange Agreements
Effective Date of any stock split, stock dividend, stock combination recapitalization or other similar transaction involving the Common
Stock.
(yy)
“Subject Entity” means any Person, Persons or Group or any Affiliate or associate of any such Person, Persons or Group.
(zz)
“Subsequent Placement” means at any time on or prior to the fourth anniversary of the Initial Issuance Date, the
Company or any of its Subsidiaries shall, directly or indirectly, issue, offer, sell, grant any option or right to purchase, or otherwise
dispose of (or announce any issuance, offer, sale, grant of any option or right to purchase or other disposition of) any equity security
or any equity-linked or related security (including, without limitation, any “equity security” (as that term is defined under
Rule 405 promulgated under the 1933 Act), any Convertible Securities, any debt, any preferred stock or any purchase rights).
(aaa)
“Subsidiary” shall have the meaning set forth in the Exchange Agreements.
(bbb)
“Successor Entity” means the Person (or, if so elected by the Required Holders, the Parent Entity) formed by, resulting
from or surviving any Fundamental Transaction or the Person (or, if so elected by the Required Holders, the Parent Entity) with which
such Fundamental Transaction shall have been entered into.
(ccc)
“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 applicable
Holder or (y) with respect to all determinations other than price 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.
(ddd)
“Transaction Documents” means the Exchange Agreements, this Certificate of Designations, the Registration Rights Agreement
and each of the other agreements and instruments entered into or delivered by the Company or any of the Holders in connection with the
transactions contemplated by the Exchange Agreements, all as may be amended from time to time in accordance with the terms thereof.
(eee)
“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 Required Holders. If the Company and the Required Holders 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 23. All such determinations
shall be appropriately adjusted for any stock dividend, stock split, stock combination, recapitalization or other similar transaction
during such period.
33.
Disclosure. Upon receipt or delivery by the Company of any notice
in accordance with the terms of this Certificate of Designations, 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 applicable
Holder explicitly in writing in such notice (or immediately upon receipt of notice from such 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 such Holder),
such 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.
34.
Absence of Trading and Disclosure Restrictions. The Company acknowledges
and agrees that no Holder is a fiduciary or agent of the Company and that each 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 such 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 each 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.
[The
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IN
WITNESS WHEREOF, the Company has caused this Certificate of Designations of the Certificate of Incorporation of Aditxt, Inc. to be signed
by its Chief Executive Officer on this 22nd day of December, 2023.
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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
I
ADITXT,
INC.
CONVERSION
NOTICE
Reference
is made to the Certificate of Designations of the Certificate of Incorporation of Aditxt, Inc., a Delaware corporation (the “Company”)
establishing the terms, preferences and rights of the Series A-1 Convertible Preferred Stock, $0.001 par value (the “Preferred
Shares”) of the Company (the “Certificate of Designations”). In accordance with and pursuant to the Certificate
of Designations, the undersigned hereby elects to convert the number of Preferred Shares indicated below into shares of common stock,
$0.001 value per share (the “Common Stock”), of the Company, as of the date specified below.
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Date of Conversion: |
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Aggregate number of Preferred Shares to be converted: |
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Aggregate Stated Value of such Preferred
Shares to be converted: |
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Aggregate accrued and unpaid
Dividends with respect to such Preferred
Shares to be converted: |
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AGGREGATE CONVERSION AMOUNT TO BE CONVERTED: |
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| Please confirm the following information: |
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Conversion Price: |
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Number of shares of Common
Stock to be issued: |
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| ☐ | If
this Conversion Notice is being delivered with respect to an Alternate Conversion, check
here if Holder is electing to use the following Alternate Conversion Price: ____________ |
Please
issue the Common Stock into which the applicable Preferred Shares are being converted 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: |
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DTC Participant: |
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DTC Number: |
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Account Number: |
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Date: _____________
__, __
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| Name of Registered Holder |
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| Tax ID:_____________________ |
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| E-mail Address: |
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EXHIBIT
II
ACKNOWLEDGMENT
The
Company hereby (a) acknowledges this Conversion Notice, (b) certifies that the above indicated number of shares of Common Stock are eligible
to be resold by the applicable Holder without restriction and hereby directs _________________ to issue the above indicated number of
shares of Common Stock in accordance with the Transfer Agent Instructions dated _____________, 20__ from the Company and acknowledged
and agreed to by ________________________.
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ADITXT, INC. |
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By: |
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Name: |
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Title: |
APPENDIX
B
CERTIFICATE
OF DESIGNATIONS
OF RIGHTS AND PREFERENCES OF
SERIES C-1 CONVERTIBLE PREFERRED STOCK OF
ADITXT, INC.
I,
Amro Albanna, hereby certify that I am the Chief Executive Officer and Chairman of Aditxt, Inc. (the “Company”), a
corporation organized and existing under the Delaware General Corporation Law (the “DGCL”), and further do hereby
certify:
That
pursuant to the authority expressly conferred upon the Board of Directors of the Company (the “Board”) by the Company’s
Amended and Restated Certificate of Incorporation, as amended (the “Certificate of Incorporation”), and Section 151(g)
of the DGCL, the Board on May 2, 2024 adopted the following resolution determining it desirable and in the best interests of the Company
and its stockholders for the Company to create a series of Ten Thousand Eight Hundred Fifty Three(10,853) shares of preferred stock designated
as “Series C-1 Convertible Preferred Stock”, none of which shares have been issued, to be issued pursuant to the Securities
Agreements (as defined in below), in accordance with the terms of the applicable Securities Agreement:
RESOLVED,
that pursuant to the authority vested in the Board, in accordance with the provisions of the Certificate of Incorporation, a series of
preferred stock, par value $0.001 per share, of the Company be and hereby is created pursuant to this certificate of designations (this
“Certificate of Designations”), and that the designation and number of shares established pursuant hereto and the
voting and other powers, preferences and relative, participating, optional or other rights of the shares of such series and the qualifications,
limitations and restrictions thereof are as follows:
TERMS
OF SERIES C-1 CONVERTIBLE PREFERRED STOCK
1.
Designation and Number of Shares. There shall hereby be created and established a series of preferred stock of the Company designated
as “Series C-1 Convertible Preferred Stock” (the “Series C-1 Convertible Preferred Stock”). The authorized
number of shares of Series C-1 Convertible Preferred Stock (the “Preferred Shares”) shall be Ten Thousand Eight Hundred
Fifty Three (10,853) shares. Each Preferred Share shall have a par value of $0.001 per share. Capitalized terms not defined herein shall
have the meaning as set forth in Section 32 below.
2.
Ranking. Except (i) for shares of Senior Preferred Stock (as defined below) to be issued to certain senior creditors of Evofem
Biosciences, Inc. pursuant to the transactions contemplated by the Merger Agreement (the “Merger Senior Preferred Stock”),
shares of Parity Stock (as defined below) to be issued pursuant to (x) the transactions contemplated by the Merger Agreement (as defined
below) and the Exchange Agreements (as defined below) and (y) shares of Parity Stock to be issued pursuant to other acquisitions or strategic
transactions with a stated value of not more than $10 million in the aggregate on terms and conditions no more favorable as those set
forth herein (the “Merger Parity Stock”) and (y) shares of Parity Stock to be issued pursuant as advisory fees with
a stated value of not more than $925,000 in the aggregate on terms and conditions no more favorable than set forth herein (the “Advisory
Parity Stock”) or (ii) to the extent that each of the Required Holders expressly consent to the creation of Parity Stock (as
defined below) or Senior Preferred Stock (as defined below) in accordance with Section 16, all shares of
capital stock of the Company shall be junior in rank to all Preferred Shares with respect to the preferences as to dividends, distributions
and payments upon the liquidation, dissolution and winding up of the Company (such junior stock is referred to herein collectively as
“Junior Stock”). For the avoidance of doubt, the Preferred Shares will, with respect to dividend rights and rights
on liquidation, winding-up and dissolution, rank (A) junior to the Merger Senior Preferred Stock, (B) on parity with the Parity Stock
and (C) senior to the Junior Stock. The rights of all such shares of capital stock of the Company shall be subject to the rights, powers,
preferences and privileges of the Preferred Shares. Without limiting any other provision of this Certificate of Designations, without
the prior express consent of each of the Required Holders, voting separately as a single class, the Company shall not hereafter authorize
or issue any additional or other shares of capital stock that is (i) of senior rank to the Preferred Shares in respect of the preferences
as to dividends, distributions and payments upon the liquidation, dissolution and winding up of the Company (collectively, the “Senior
Preferred Stock”), other than the Merger Senior Preferred Stock, (ii) of pari passu rank to the Preferred Shares in respect
of the preferences as to dividends, distributions and payments upon the liquidation, dissolution and winding up of the Company (collectively,
the “Parity Stock”), other than Parity Stock to be issued pursuant to the transactions contemplated by the Merger
Agreement, Merger Parity Stock and Advisory Parity Stock or (iii) any Junior Stock having a maturity date or any other date requiring
redemption or repayment of such shares of Junior Stock that is prior to the first anniversary of the Initial Issuance Date. In the event
of the merger or consolidation of the Company with or into another corporation, the Preferred Shares shall maintain their relative rights,
powers, designations, privileges and preferences provided for herein and no such merger or consolidation shall result inconsistent therewith.
3.
Dividends. In addition to Section 7, Section 8 and/or Section 15 below, as applicable, subject to the senior rights of the Senior
Preferred Stock, and pari passu with the holders of shares of Parity Stock, from and after the first date of issuance of any Preferred
Shares (the “Initial Issuance Date”), each holder of a Preferred Share (each, a “Holder” and collectively,
the “Holders”) shall be entitled to receive dividends (“Dividends”) when and as declared by the
Board, from time to time, in its sole discretion, which Dividends shall be paid by the Company out of funds legally available therefor,
payable, subject to the conditions and other terms hereof, in cash, in securities of the Company or any other entity, or using assets
as determined by the Board on the Stated Value of such Preferred Share.
4.
Conversion. At any time after the Initial Issuance Date, each Preferred Share shall be convertible into validly issued, fully
paid and non-assessable shares of Common Stock (the “Conversion Shares”), on the terms and conditions set forth in
this Section 4.
(a)
Holder’s Conversion Right. Subject to the provisions of Section 4(d), at any time or times on or after the Initial Issuance
Date, each Holder shall be entitled to convert any portion of the outstanding Preferred Shares held by such Holder into validly issued,
fully paid and non-assessable Conversion Shares in accordance with Section 4(c) at the Conversion Rate (as defined below). The Company
shall not issue any fraction of a share of Common Stock upon any conversion. If the issuance would result in the issuance of a fraction
of a share of Common Stock, the Company shall round such fraction of a share of Common Stock up to the nearest whole share. The Company
shall pay any and all transfer, stamp, issuance and similar taxes, costs and expenses (including, without limitation, fees and expenses
of the Company’s transfer agent (the “Transfer Agent”)) that may be payable with respect to the issuance and
delivery of Common Stock upon conversion of any Preferred Shares.
(b)
Conversion Rate. Except as otherwise provided herein, the number of Conversion Shares issuable upon conversion of any Preferred
Share pursuant to this Section 4 shall be determined by dividing (x) the Conversion Amount of such Preferred Share by (y) the Conversion
Price (the “Conversion Rate”).
For
purposes of this Certificate of Designations, the term “Conversion Amount” means, with respect to each Preferred Share,
as of the applicable date of determination, the sum of (1) the Stated Value thereof plus (2) any Additional Amount thereon as
of such date of determination plus (3) any other amounts owed to such Holder pursuant to this Certificate of Designations or any
Transaction Document.
For
purposes of this Certificate of Designations, the term “Conversion Price” means, with respect to each Preferred Share,
as of any Conversion Date or other date of determination, $2.595, subject to adjustment as provided herein.
(c)
Mechanics of Conversion. The conversion of each Preferred Share shall be conducted in the following manner:
(i)
Optional Conversion. To convert one or more Preferred Shares into Conversion Shares on any date (a “Conversion Date”),
a Holder shall deliver (whether via electronic mail or otherwise), for receipt on or prior to 11:59 p.m., New York time, on such date,
a copy of an executed notice of conversion of the Preferred Share(s) subject to such conversion in the form attached hereto as Exhibit
I (the “Conversion Notice”) to the Company. If required by Section 4(c)(iii), within two (2) Trading Days following
a conversion of any such Preferred Shares as aforesaid, such Holder shall surrender to a nationally recognized overnight delivery service
for delivery to the Company the original certificates, if any, representing the Preferred Shares (the “Preferred Share Certificates”)
so converted as aforesaid (or an indemnification undertaking with respect to the Preferred Shares in the case of its loss, theft or destruction
as contemplated by Section 18(b)). On or before the first (1st) Trading Day following the date of receipt of a Conversion
Notice, the Company shall transmit by electronic mail an acknowledgment of confirmation and representation as to whether such shares
of Common Stock may then be resold pursuant to Rule 144 or an effective and available registration statement, in the form attached hereto
as Exhibit II, of receipt of such Conversion Notice to such Holder and the Transfer Agent, which confirmation shall constitute
an instruction to the Transfer Agent to process such Conversion Notice in accordance with the terms set forth herein. On or before the
first (1st) Trading Day following each date on which the Company has received a Conversion 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 initiated on the applicable
Conversion Date of such Conversion Shares issuable pursuant to such Conversion Notice) (the “Share Delivery Deadline”),
the Company shall (1) provided that the Transfer Agent is participating in the Depository Trust Company (“DTC”) Fast
Automated Securities Transfer Program (“FAST”), credit such aggregate number of Conversion Shares to which such Holder
shall be entitled pursuant to such conversion to such Holder’s or its designee’s balance account with DTC through its Deposit/Withdrawal
at Custodian system, or (2) if the Transfer Agent is not participating in FAST, upon the request of such Holder, issue and deliver (via
reputable overnight courier) to the address as specified in such Conversion Notice, a certificate, registered in the name of such Holder
or its designee, for the number of Conversion Shares to which such Holder shall be entitled. If the number of Preferred Shares represented
by the Preferred Share Certificate(s) submitted for conversion pursuant to Section 4(c)(iii) is greater
than the number of Preferred Shares being converted, then the Company shall, as soon as practicable and in no event later than two (2)
Trading Days after receipt of the Preferred Share Certificate(s) and at its own expense, issue and mail to such Holder (or its designee)
by overnight courier service a new Preferred Share Certificate or a new Book-Entry (in either case, in accordance with Section 18(d))
representing the number of Preferred Shares not converted. The Person or Persons entitled to receive the Conversion Shares issuable upon
a conversion of Preferred Shares shall be treated for all purposes as the record holder or holders of such Conversion Shares on the Conversion
Date; provided, that such Person shall be deemed to have waived any voting rights of any such Conversion Shares that may arise with respect
to any record date during the period commencing on such Conversion Date, through, and including, such applicable Share Delivery Deadline
(each, an “Conversion Period”), as necessary, such that the aggregate voting rights of any Common Stock (including
such Conversion Shares) beneficially owned by such Person and/or any of its Attribution Parties, collectively, on any such record date
shall not exceed the Maximum Percentage (as defined below) as a result of any such conversion of such applicable Preferred Shares with
respect thereto. Notwithstanding the foregoing, if a Holder delivers a Conversion Notice to the Company prior to the date of issuance
of Preferred Shares to such Holder, whereby such Holder elects to convert such Preferred Shares pursuant to such Conversion Notice, the
Share Delivery Deadline with respect to any such Conversion Notice shall be the later of (x) the date of issuance of such Preferred Shares
and (y) the first (1st) Trading Day after the date of such Conversion Notice. Notwithstanding anything to the contrary contained in this
Certificate of Designations or the Registration Rights Agreement, after the effective date of a Registration Statement (as defined in
the Registration Rights Agreement) and prior to a Holder’s receipt of the notice of a Grace Period (as defined in the Registration
Rights Agreement), the Company shall cause the Transfer Agent to deliver unlegended shares of Common Stock to such Holder (or its designee)
in connection with any sale of Registrable Securities (as defined in the Registration Rights Agreement) with respect to which such 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 such Holder has not yet settled.
(ii)
Company’s Failure to Timely Convert. If the Company shall fail, for any reason or for no reason, on or prior to the applicable
Share Delivery Deadline, either (I) if the Transfer Agent is not participating in FAST, to issue and deliver to such Holder (or its designee)
a certificate for the number of Conversion Shares to which such Holder is entitled and register such Conversion Shares on the Company’s
share register or, if the Transfer Agent is participating in FAST, to credit such Holder’s or its designee’s balance account
with DTC for such number of Conversion Shares to which such Holder is entitled upon such Holder’s conversion of any Conversion
Amount (as the case may be) or (II) if the Registration Statement covering the resale of the Conversion Shares that are the subject of
the Conversion Notice (the “Unavailable Conversion Shares”) is not available for the resale of such Unavailable Conversion
Shares and the Company fails to promptly, but in no event later than as required pursuant to the Registration Rights Agreement (x) notify
such Holder and (y) deliver the shares of Common Stock electronically without any restrictive legend by crediting such aggregate number
of shares of Common Stock to which such Holder is entitled pursuant to such conversion 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 “Conversion
Failure”), then, in addition to all other remedies available to such Holder, (X) the Company shall pay in cash to such Holder
on each day after the Share Delivery Deadline that the issuance of such Conversion Shares is not timely effected an amount equal to 2%
of the product of (A) the sum of the number of Conversion Shares not issued to such Holder on or prior to the Share Delivery Deadline
and to which such Holder is entitled, multiplied by (B) any trading price of the Common Stock selected by such Holder in writing as in
effect at any time during the period beginning on the applicable Conversion Date and ending on the applicable Share Delivery Deadline,
and (Y) such Holder, upon written notice to the Company, may void its Conversion Notice with respect to, and retain or have returned,
as the case may be, all, or any portion, of such Preferred Shares that has not been converted pursuant to such Conversion Notice; provided
that the voiding of a Conversion 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 4(c)(ii) or otherwise. In addition to the foregoing, if on or prior to the Share
Delivery Deadline either (A) the Transfer Agent is not participating in FAST, the Company shall fail to issue and deliver to such Holder
(or its designee) a certificate and register such Conversion Shares on the Company’s share register or, if the Transfer Agent is
participating in the FAST, the Transfer Agent shall fail to credit the balance account of such Holder or such Holder’s designee,
as applicable, with DTC for the number of Conversion Shares to which such Holder is entitled upon such Holder’s conversion hereunder
or pursuant to the Company’s obligation pursuant to clause (ii) below or (B) a Notice Failure occurs, and if on or after such Share
Delivery Deadline such 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 Conversion Shares issuable upon such conversion that such Holder is entitled to receive from the
Company and has not received from the Company in connection with such Conversion Failure or Notice Failure, as applicable (a “Buy-In”),
then, in addition to all other remedies available to such Holder, the Company shall, within two (2) Business Days after receipt of such
Holder’s request and in such Holder’s discretion, either: (I) pay cash to such Holder in an amount equal to such 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 such Holder) (the “Buy-In
Price”), at which point the Company’s obligation to so issue and deliver such certificate (and to issue such Conversion
Shares) or credit to the balance account of such Holder or such Holder’s designee, as applicable, with DTC for the number of Conversion
Shares to which such Holder is entitled upon such Holder’s conversion hereunder (as the case may be) (and to issue such Conversion
Shares) shall terminate, or (II) promptly honor its obligation to so issue and deliver to such Holder a certificate or certificates representing
such Conversion Shares or credit the balance account of such Holder or such Holder’s designee, as applicable, with DTC for the
number of Conversion Shares to which such Holder is entitled upon such Holder’s conversion hereunder (as the case may be) and pay
cash to such Holder in an amount equal to the excess (if any) of the Buy-In Price over the product of (x) such number of shares of Common
Stock multiplied by (y) the lowest Closing Sale Price of the Common Stock on any Trading Day during the period commencing on the date
of the applicable Conversion Notice and ending on the date of such issuance and payment under this clause (II) (each, a “Buy-In
Payment Amount”). Nothing herein 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 Conversion Shares (or to electronically deliver such Conversion Shares) upon the
conversion of the Preferred Shares as required pursuant to the terms hereof. Notwithstanding anything herein to the contrary, with respect
to any given Notice Failure and/or Conversion Failure, as applicable, this Section 4(c)(ii) shall not apply
to a Holder to the extent the Company has already paid such amounts in full to such Holder with respect to such Notice Failure and/or
Conversion Failure, as applicable, pursuant to the analogous sections of any other agreement with such Holder.
(iii)
Registration; Book-Entry. At the time of issuance of any Preferred Shares hereunder, the applicable Holder may, by written request
(including by electronic-mail) to the Company, elect to receive such Preferred Shares in the form of one or more Preferred Share Certificates
or in Book-Entry form. The Company (or the Transfer Agent, as custodian for the Preferred Shares) shall maintain a register (the “Register”)
for the recordation of the names and addresses of the Holders of each Preferred Share and the Stated Value of the Preferred Shares and
whether the Preferred Shares are held by such Holder in Preferred Share Certificates or in Book-Entry form (the “Registered
Preferred Shares”). The entries in the Register shall be conclusive and binding for all purposes absent manifest error. The
Company and each Holder of the Preferred Shares shall treat each Person whose name is recorded in the Register as the owner of a Preferred
Share for all purposes (including, without limitation, the right to receive payments and Dividends hereunder) notwithstanding notice
to the contrary. A Registered Preferred Share may be assigned, transferred or sold only by registration of such assignment or sale on
the Register. Upon its receipt of a written request to assign, transfer or sell one or more Registered Preferred Shares by such Holder
thereof, the Company shall record the information contained therein in the Register and issue one or more new Registered Preferred Shares
in the same aggregate Stated Value as the Stated Value of the surrendered Registered Preferred Shares to the designated assignee or transferee
pursuant to Section 18, provided that if the Company does not so record an assignment, transfer or sale (as the case may be) of
such Registered Preferred Shares within two (2) Business Days of such a request, then the Register shall be automatically deemed updated
to reflect such assignment, transfer or sale (as the case may be). Notwithstanding anything to the contrary set forth in this Section 4,
following conversion of any Preferred Shares in accordance with the terms hereof, the applicable Holder shall not be required to physically
surrender such Preferred Shares held in the form of a Preferred Share Certificate to the Company unless (A) the full or remaining number
of Preferred Shares represented by the applicable Preferred Share Certificate are being converted (in which event such certificate(s)
shall be delivered to the Company as contemplated by this Section 4(c)(iii)) or (B) such Holder has provided the Company with prior written
notice (which notice may be included in a Conversion Notice) requesting reissuance of Preferred Shares upon physical surrender of the
applicable Preferred Share Certificate. Each Holder and the Company shall maintain records showing the Stated Value and Dividends converted
and/or paid (as the case may be) and the dates of such conversions and/or payments (as the case may be) or shall use such other method,
reasonably satisfactory to such Holder and the Company, so as not to require physical surrender of a Preferred Share Certificate upon
conversion. If the Company does not update the Register to record such Stated Value and Dividends converted and/or paid (as the case
may be) and the dates of such conversions and/or payments (as the case may be) within two (2) Business Days of such occurrence, then
the Register shall be automatically deemed updated to reflect such occurrence. In the event of any dispute or discrepancy, such records
of such Holder establishing the number of Preferred Shares to which the record holder is entitled shall be controlling and determinative
in the absence of manifest error. A Holder and any transferee or assignee, by acceptance of a certificate, acknowledge and agree that,
by reason of the provisions of this paragraph, following conversion of any Preferred Shares, the number of Preferred Shares represented
by such certificate may be less than the number of Preferred Shares stated on the face thereof. Each Preferred Share Certificate shall
bear the following legend:
ANY
TRANSFEREE OR ASSIGNEE OF THIS CERTIFICATE SHOULD CAREFULLY REVIEW THE TERMS OF THE CORPORATION’S CERTIFICATE OF DESIGNATIONS RELATING
TO THE SHARES OF SERIES C-1 CONVERTIBLE PREFERRED STOCK REPRESENTED BY THIS CERTIFICATE, INCLUDING SECTION 4(c)(iii) THEREOF. THE NUMBER
OF SHARES OF SERIES C-1 CONVERTIBLE PREFERRED STOCK REPRESENTED BY THIS CERTIFICATE MAY BE LESS THAN THE NUMBER OF SHARES OF SERIES C-1
CONVERTIBLE PREFERRED STOCK STATED ON THE FACE HEREOF PURSUANT TO SECTION 4(c)(iii) OF THE CERTIFICATE OF DESIGNATIONS RELATING TO THE
SHARES OF SERIES C-1 CONVERTIBLE PREFERRED STOCK REPRESENTED BY THIS CERTIFICATE.
(iv)
Pro Rata Conversion; Disputes. In the event that the Company receives a Conversion Notice from more than one Holder for the same
Conversion Date and the Company can convert some, but not all, of such Preferred Shares submitted for conversion, the Company shall convert
from each Holder electing to have Preferred Shares converted on such date a pro rata amount of such Holder’s Preferred Shares submitted
for conversion on such date based on the number of Preferred Shares submitted for conversion on such date by such Holder relative to
the aggregate number of Preferred Shares submitted for conversion on such date. In the event of a dispute as to the number of Conversion
Shares issuable to a Holder in connection with a conversion of Preferred Shares, the Company shall issue to such Holder the number of
Conversion Shares not in dispute and resolve such dispute in accordance with Section 23. If a Conversion Notice delivered to the Company
would result in a breach of Section 4(d) below, and the Holder does not elect in writing to withdraw, in whole, such Conversion Notice,
the Company shall hold such Conversion Notice in abeyance until such time as such Conversion Notice may be satisfied without violating
Section 4(d) below (with such calculations thereunder made as of the date such Conversion Notice was initially delivered to the Company).
(d)
Limitation on Beneficial Ownership. The Company shall not effect the conversion of any of the Preferred Shares held by a Holder,
and such Holder shall not have the right to convert any of the Preferred Shares held by such Holder pursuant to the terms and conditions
of this Certificate of Designations and any such conversion shall be null and void and treated as if never made, to the extent that after
giving effect to such conversion, such 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
conversion. For purposes of the foregoing sentence, the aggregate number of shares of Common Stock beneficially owned by such Holder
and the other Attribution Parties shall include the number of shares of Common Stock held by such Holder and all other Attribution Parties
plus the number of shares of Common Stock issuable upon conversion of the Preferred Shares 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) conversion of the remaining,
nonconverted Preferred Shares beneficially owned by such Holder or any of the other Attribution Parties and (B) exercise or conversion
of the unexercised or nonconverted portion of any other securities of the Company (including, without limitation, any convertible notes,
convertible preferred stock or warrants, including the Preferred Shares) beneficially owned by such Holder or any other Attribution Party
subject to a limitation on conversion or exercise analogous to the limitation contained in this Section 4(d). For purposes of this Section
4(d), beneficial ownership shall be calculated in accordance with Section 13(d) of the 1934 Act. For the avoidance of doubt, the calculation
of the Maximum Percentage shall take into account the concurrent exercise and/or conversion, as applicable, of the unexercised or unconverted
portion of any other securities of the Company beneficially owned by the Holder and/or any other Attribution Party, as applicable. For
purposes of determining the number of outstanding shares of Common Stock a Holder may acquire upon the conversion of such Preferred Shares
without exceeding the Maximum Percentage, such 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 a Conversion Notice from a 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 notify such Holder in writing of the number of
shares of Common Stock then outstanding and, to the extent that such Conversion Notice would otherwise cause such Holder’s beneficial
ownership, as determined pursuant to this Section 4(d), to exceed the Maximum Percentage, such Holder must notify the Company of a reduced
number of shares of Common Stock to be purchased pursuant to such Conversion Notice. For any reason at any time, upon the written or
oral request of any Holder, the Company shall within one (1) Business Day confirm orally and in writing or by electronic mail to such
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 such Preferred Shares, by such 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 a Holder upon conversion of such Preferred Shares results in such 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 such 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 such Holder shall not have the power to vote or to transfer the Excess
Shares. Upon delivery of a written notice to the Company, any 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 of such Holder 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 such Holder and the other Attribution Parties and not to any other Holder that is not an Attribution Party
of such Holder. For purposes of clarity, the shares of Common Stock issuable to a Holder pursuant to the terms of this Certificate of
Designations in excess of the Maximum Percentage shall not be deemed to be beneficially owned by such Holder for any purpose including
for purposes of Section 13(d) or Rule 16a-1(a)(1) of the 1934 Act. No prior inability to convert such Preferred Shares pursuant to this
paragraph shall have any effect on the applicability of the provisions of this paragraph with respect to any subsequent determination
of convertibility. The provisions of this paragraph shall not be construed and implemented in a manner otherwise than in strict conformity
with the terms of this Section 4(d) 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 4(d)
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 such Preferred Shares.
(e)
Right of Alternate Conversion Upon a Triggering Event.
(i)
General. Subject to Section 4(d), at any time after the later of (A) the Stockholder Approval Date (as defined in the Securities
Agreements) and (B) the earlier of a Holder’s receipt of a Triggering Event Notice (as defined below) and such Holder becoming
aware of a Triggering Event (such earlier date, the “Alternate Conversion Right Commencement Date”) and ending (such
ending date, the “Alternate Conversion Right Expiration Date”, and each such period, an “Alternate Conversion
Right Period”) on the twentieth (20th) Trading Day after the later of (x) the date such Triggering Event is cured
and (y) such Holder’s receipt of a Triggering Event Notice that includes (I) a reasonable description of the applicable Triggering
Event, (II) a certification as to whether, in the reasonable opinion of the Company, such Triggering Event is capable of being cured
and, if applicable, a reasonable description of any existing plans of the Company to cure such Triggering Event and (III) a certification
as to the date the Triggering Event occurred and, if cured on or prior to the date of such Triggering Event Notice, the applicable Alternate
Conversion Right Expiration Date, such Holder may, at such Holder’s option, by delivery of a Conversion Notice to the Company (the
date of any such Conversion Notice, each an “Alternate Conversion Date”), convert all, or any number of Preferred
Shares held by such Holder into shares of Common Stock at the Alternate Conversion Price (each, an “Alternate Conversion”).
(ii)
Mechanics of Alternate Conversion. On any Alternate Conversion Date, a Holder may voluntarily convert any number of Preferred
Shares held by such Holder pursuant to Section 4(c) (with “Alternate Conversion Price” replacing “Conversion Price”
for all purposes hereunder with respect to such Alternate Conversion and with “the applicable Required Premium multiplied by the
Conversion Amount” replacing “Conversion Amount” in clause (x) of the definition of Conversion Rate in Section 4(b)
above with respect to such Alternate Conversion) by designating in the Conversion Notice delivered pursuant to this Section 4(e) of this
Certificate of Designations that such Holder is electing to use the Alternate Conversion Price for such conversion; provided that in
the event of the Conversion Floor Price Condition, on the applicable Alternate Conversion Date the Stated Value of the remaining Preferred
Shares of such Holder shall automatically increase, pro rata, by the applicable Alternate Conversion Floor Amount or, at the Company’s
option, the Company shall deliver the applicable Alternate Conversion Floor Amount to the Holder on the applicable Alternate Conversion
Date. Notwithstanding anything to the contrary in this Section 4(e), but subject to Section 4(d), until the Company delivers to such
Holder the shares of Common Stock to which the Holder is entitled pursuant to the applicable Alternate Conversion of such Holder’s
Preferred Shares, such Preferred Shares may be converted by such Holder into shares of Common Stock pursuant to Section 4(c) without
regard to this Section 4(e).
5.
Triggering Events.
(a)
General. Each of the following events shall constitute a “Triggering Event”:
(i)
the failure of the applicable Registration Statement (as defined in the Registration Rights Agreement) to be filed with the SEC on or
prior to the date that is five (5) days after the applicable Filing Deadline (as defined in the Registration Rights Agreement) or the
failure of the applicable Registration Statement to be declared effective by the SEC on or prior to the date that is five (5) days after
the applicable Effectiveness Deadline (as defined in the Registration Rights Agreement);
(ii)
while the applicable Registration Statement is required to be maintained effective pursuant to the terms of the Registration Rights Agreement,
the effectiveness of the applicable Registration Statement lapses for any reason (including, without limitation, the issuance of a stop
order) or such Registration Statement (or the prospectus contained therein) is unavailable to any holder of Registrable Securities (as
defined in the Registration Rights Agreement) for sale of all of such holder’s Registrable Securities in accordance with the terms
of the Registration Rights Agreement, and such lapse or unavailability continues for a period of five (5) consecutive days or for more
than an aggregate of ten (10) days in any 365-day period (excluding days during an Allowable Grace Period (as defined in the Registration
Rights Agreement));
(iii)
the suspension from trading or the failure of the Common Stock to be trading or listed (as applicable) on an Eligible Market for a period
of five (5) consecutive Trading Days or the delisting, removal or withdrawal, as applicable, of registration of the Common Stock under
the 1934 Act with respect to a going-private transaction;
(iv)
the Company’s failure (A) to cure a Conversion Failure by delivery of the required number of shares of Common Stock within five
(5) Trading Days after the applicable Conversion Date or exercise date (as the case may be) or (B) notice, written or oral, to any holder
of Preferred Shares, including, without limitation, by way of public announcement or through any of its agents, at any time, of its intention
not to comply, as required, with a request for conversion of any Preferred Shares into shares of Common Stock that is requested in accordance
with the provisions of this Certificate of Designations, other than pursuant to Section 4(d) hereof;
(v)
except to the extent the Company is in compliance with Section 11(b) below, at any time following the tenth (10th) consecutive day that
a Holder’s Authorized Share Allocation (as defined in Section 11(a) below) is less than the Required Reserve Amount as of such
date of determination;
(vi)
the Company’s failure to pay to any Holder any Dividend when required to be paid hereunder (whether or not declared by the Board)
or any other amount when and as due under this Certificate of Designations (including, without limitation, the Company’s failure
to pay any redemption payments or amounts hereunder), the applicable Securities Agreements or any other Transaction Document or any other
agreement, document, certificate or other instrument delivered in connection with the transactions contemplated hereby and thereby (in
each case, whether or not permitted pursuant to the DGCL), except, in the case of a failure to pay Dividends when and as due, in each
such case only if such failure remains uncured for a period of at least two (2) Trading Days;
(vii)
the Company fails to remove any restrictive legend on any certificate or any shares of Common Stock issued to the applicable Holder upon
conversion of the Preferred Shares held by such Holder as and when required by this Certificate of Designations, unless otherwise then
prohibited by applicable federal securities laws, and any such failure remains uncured for at least five (5) days;
(viii)
the occurrence of any default under, redemption of or acceleration prior to maturity of at least an aggregate of $500,000 of indebtedness
for borrowed money of the Company or any of its Subsidiaries, excluding any indebtedness for borrowed money in which no cash payment
is required at such time pursuant to a forbearance agreement in full force and effect or any applicable grace period under the terms
of such indebtedness for borrowed money, except, in the case of a default or breach that is curable, only if such default or breach,
as applicable, remains uncured for a period of twenty (20) days;
(ix)
bankruptcy, insolvency, reorganization or liquidation proceedings or other proceedings for the relief of debtors shall be instituted
by or against the Company or any Subsidiary and, if instituted against the Company or any Subsidiary by a third party, shall not be dismissed
within thirty (30) days of their initiation;
(x)
the commencement by the Company or any Subsidiary of a voluntary case or proceeding under any applicable federal, state or foreign bankruptcy,
insolvency, reorganization or other similar law or of any other case or proceeding to be adjudicated a bankrupt or insolvent, or the
consent by it to the entry of a decree, order, judgment or other similar document in respect of the Company or any Subsidiary in an involuntary
case or proceeding under any applicable federal, state or foreign bankruptcy, insolvency, reorganization or other similar law or to the
commencement of any bankruptcy or insolvency case or proceeding against it, or the filing by it of a petition or answer or consent seeking
reorganization or relief under any applicable federal, state or foreign law, or the consent by it to the filing of such petition or to
the appointment of or taking possession by a custodian, receiver, liquidator, assignee, trustee, sequestrator or other similar official
of the Company or any Subsidiary or of any substantial part of its property, or the making by it of an assignment for the benefit of
creditors, or the execution of a composition of debts, or the occurrence of any other similar federal, state or foreign proceeding, or
the admission by it in writing of its inability to pay its debts generally as they become due, the taking of corporate action by the
Company or any Subsidiary in furtherance of any such action or the taking of any action by any Person to commence a Uniform Commercial
Code foreclosure sale or any other similar action under federal, state or foreign law;
(xi)
the entry by a court of (i) a decree, order, judgment or other similar document in respect of the Company or any Subsidiary of a voluntary
or involuntary case or proceeding under any applicable federal, state or foreign bankruptcy, insolvency, reorganization or other similar
law or (ii) a decree, order, judgment or other similar document adjudging the Company or any Subsidiary as bankrupt or insolvent, or
approving as properly filed a petition seeking liquidation, reorganization, arrangement, adjustment or composition of or in respect of
the Company or any Subsidiary under any applicable federal, state or foreign law or (iii) a decree, order, judgment or other similar
document appointing a custodian, receiver, liquidator, assignee, trustee, sequestrator or other similar official of the Company or any
Subsidiary or of any substantial part of its property, or ordering the winding up or liquidation of its affairs, and the continuance
of any such decree, order, judgment or other similar document or any such other decree, order, judgment or other similar document unstayed
and in effect for a period of thirty (30) consecutive days;
(xii)
a final judgment or judgments for the payment of money aggregating in excess of $500,000 are rendered against the Company and/or any
of its Subsidiaries and which judgments are not, within thirty (30) days after the entry thereof, bonded, discharged, settled or stayed
pending appeal, or are not discharged within thirty (30) days after the expiration of such stay; provided, however, any judgment which
is covered by insurance or an indemnity from a credit worthy party shall not be included in calculating the $500,000 amount set forth
above so long as the Company provides each Holder a written statement from such insurer or indemnity provider (which written statement
shall be reasonably satisfactory to each 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;
(xiii)
the Company and/or any Subsidiary, individually or in the aggregate, either (i) fails to pay, when due, or within any applicable grace
period, any payment with respect to any Indebtedness in excess of $500,000 due to any third party (other than, with respect to unsecured
Indebtedness only, payments contested by the Company and/or such Subsidiary (as the case may be) in good faith by proper proceedings
and with respect to which adequate reserves have been set aside for the payment thereof in accordance with GAAP) or is otherwise in breach
or violation of any agreement for monies owed or owing in an amount in excess of $500,000, which breach or violation permits the other
party thereto to declare a default or otherwise accelerate amounts due thereunder, or (ii) suffer to exist any other circumstance or
event that would, with or without the passage of time or the giving of notice, result in a default or event of default under any agreement
binding the Company or any Subsidiary, which default or event of default would or is likely to have a material adverse effect on the
business, assets, operations (including results thereof), liabilities, properties, condition (including financial condition) or prospects
of the Company or any of its Subsidiaries, individually or in the aggregate;
(xiv)
other than as specifically set forth in another clause of this Section 5(a), the Company or any Subsidiary breaches any representation
or warranty in any material respect (other than representations or warranties subject to material adverse effect or materiality, which
may not be breached in any respect) or any 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 that is curable, only if such breach remains uncured for a period of five (5) consecutive
Trading Days;
(xv)
a false or inaccurate certification (including a false or inaccurate deemed certification) by the Company as to whether any Triggering
Event has occurred;
(xvi)
any Preferred Shares remain outstanding on or after May 2, 2027;
(xvii)
any breach or failure in any respect by the Company or any Subsidiary to comply with any provision of Section 13 of this Certificate
of Designations;
(xviii)
any Change of Control occurs;
(xix)
any Material Adverse Effect (as defined in the applicable Securities Agreements) occurs; or
(xx)
any provision of any Transaction Document shall at any time for any reason (other than pursuant to the express terms thereof) cease to
be valid and binding on or enforceable against the parties thereto, or the validity or enforceability thereof shall be contested, directly
or indirectly, by the Company or any Subsidiary, or a proceeding shall be commenced by the Company or any Subsidiary or any Governmental
Authority having jurisdiction over any of them, seeking to establish the invalidity or unenforceability thereof or the Company or any
of its Subsidiaries shall deny in writing that it has any liability or obligation purported to be created under one or more Transaction
Documents.
(b)
Notice of a Triggering Event. Upon the occurrence of a Triggering Event with respect to the Preferred Shares, the Company shall
within one (1) Business Day deliver written notice thereof via electronic mail and overnight courier (with next day delivery specified)
(a “Triggering Event Notice”) to each Holder.
6.
Rights Upon Fundamental Transactions.
(a)
Assumption. 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 Certificate of Designations and the other Transaction Documents in accordance
with the provisions of this Section 6(a) pursuant to written agreements in form and substance satisfactory to each of the Required Holders
and approved by each of the Required Holders prior to such Fundamental Transaction, including agreements to deliver to each holder of
Preferred Shares in exchange for such Preferred Shares a security of the Successor Entity evidenced by
a written instrument substantially similar in form and substance to this Certificate of Designations, including, without limitation,
having a stated value and dividend rate equal to the stated value and dividend rate of the Preferred Shares held by the Holders and having
similar ranking to the Preferred Shares, and satisfactory to each of the Required Holders and (ii) the Successor Entity (including
its Parent Entity) is a publicly traded corporation whose shares of common stock are quoted on or listed for trading on an Eligible Market.
Upon the occurrence of any Fundamental Transaction, the Successor Entity shall succeed to, and be substituted for (so that from and after
the date of such Fundamental Transaction, the provisions of this Certificate of Designations 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 Certificate of Designations and the other Transaction Documents with the
same effect as if such Successor Entity had been named as the Company herein and therein. In addition to the foregoing, upon consummation
of a Fundamental Transaction, the Successor Entity shall deliver to each Holder confirmation that there shall be issued upon conversion
or redemption of the Preferred Shares at any time after the consummation of such 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 7 and 15, which shall continue
to be receivable thereafter)) issuable upon the conversion or redemption of the Preferred Shares prior to such Fundamental Transaction,
such shares of the publicly traded common stock (or their equivalent) of the Successor Entity (including its Parent Entity) which each
Holder would have been entitled to receive upon the happening of such Fundamental Transaction had all the Preferred Shares held by each
Holder been converted immediately prior to such Fundamental Transaction (without regard to any limitations on the conversion of the Preferred
Shares contained in this Certificate of Designations), as adjusted in accordance with the provisions of this Certificate of Designations.
Notwithstanding the foregoing, such Holder may elect, at its sole option, by delivery of written notice to the Company to waive this
Section 6(a) to permit the Fundamental Transaction without the assumption of the Preferred Shares. The provisions of this Section 6 shall
apply similarly and equally to successive Fundamental Transactions and shall be applied without regard to any limitations on the conversion
or redemption of the Preferred Shares.
(b)
Notice of a Change of Control; Change of Control Election Notice. No sooner than twenty (20) Trading Days nor later than ten (10)
Trading Days prior to the consummation of a Change of Control (the “Change of Control Date”), but not prior to the
public announcement of such Change of Control, the Company shall deliver written notice thereof via electronic mail and overnight courier
to each Holder (a “Change of Control Notice”). At any time during the period beginning after a Holder’s receipt
of a Change of Control Notice or such Holder becoming aware of a Change of Control if a Change of Control Notice is not delivered to
such Holder in accordance with the immediately preceding sentence (as applicable) and ending on twenty (20) Trading Days after the later
of (A) the date of consummation of such Change of Control or (B) the date of receipt of such Change of Control Notice or (C) the date
of the announcement of such Change of Control, such Holder may require, by delivering written notice thereof
(“Change of Control Election Notice”) to the Company (which Change of Control Election Notice shall indicate the number
of Preferred Shares subject to such election), to have the Company exchange such Holder’s Preferred Shares designated in such Change
of Control Election Notice for consideration equal to the Change of Control Election Price (as defined below), to be satisfied at the
Company’s election (such election to pay in cash or by delivery of the Rights (as defined below), a “Consideration Election”),
in either (I) rights (with a beneficial ownership limitation in the form of Section 4(d) hereof, mutatis mutandis) (collectively,
the “Rights”), convertible in whole, or in part, at any time, without the requirement to pay any additional consideration,
at the option of the Holder, into such Corporate Event Consideration (as defined below) applicable to such Change of Control equal in
value to the Change of Control Election Price (as determined with the fair market value of the aggregate number of Successor Shares (as
defined below) issuable upon conversion of the Rights to be determined in increments of 10% (or such greater percentage as the applicable
Holder may notify the Company from time to time) of the portion of the Change of Control Election Price attributable to such Successor
Shares (the “Successor Share Value Increment”), with the aggregate number of Successor Shares issuable upon exercise
of the Rights with respect to the first Successor Share Value Increment determined based on 70% of the Closing Bid Price of the Successor
Shares on the date the Rights are issued and on each of the nine (9) subsequent Trading Days, in each case, the aggregate number of additional
Successor Shares issuable upon exercise of the Rights shall be determined based upon a Successor Share Value Increment at 70% of the
Closing Bid Price of the Successor Shares in effect for such corresponding Trading Day (such ten (10) Trading Day period commencing on,
and including, the date the Rights are issued, the “Rights Measuring Period”)), or (II) in cash; provided, that the
Company shall not consummate a Change of Control if the Corporate Event Consideration includes capital stock or other equity interest
(the “Successor Shares”) either in an entity that is not listed on an Eligible Market or an entity in which the daily
share volume for the applicable Successor Shares for each of the twenty (20) Trading Days prior to the date of consummation of such Change
of Control is less than the aggregate number of Successor Shares issuable to all Holders upon conversion in full of the applicable Rights
(without regard to any limitations on conversion therein, assuming the exercise in full of the Rights on the date of issuance of the
Rights and assuming the Closing Bid Price of the Successor Shares for each Trading Day in the Rights Measuring Period is the Closing
Bid Price on the Trading Day ended Immediately prior to the time of consummation of the Change of Control). The Company shall give each
Holder written notice of each Consideration Election at least twenty (20) Trading Days prior to the time of consummation of such Change
of Control. Payment of such amounts or delivery of the Rights, as applicable, shall be made by the Company (or at the Company’s
direction) to each Holder on the later of (x) the second (2nd) Trading Day after the date of such request and (y) the date of consummation
of such Change of Control (or, with respect to any Right, if applicable, such later time that holders of shares of Common Stock are initially
entitled to receive Corporate Event Consideration with respect to the shares of Common Stock of such holder). Any Corporate Event Consideration
included in the Rights, if any, pursuant to this Section 6(b) is pari passu with the Corporate Event Consideration to be paid
to holders of shares of Common Stock and the Company shall not permit a payment of any Corporate Event Consideration to the holders of
shares of Common Stock without on or prior to such time delivering the Right to the Holders in accordance herewith. Cash payments, if
any, required by this Section 6(b) shall have priority to payments to all other stockholders of the Company in connection with such Change
of Control. Notwithstanding anything to the contrary in this Section 6(b), but subject to Section 4(d), until the applicable Change of
Control Election Price is paid in full to the applicable Holder in cash or Corporate Event Consideration in accordance herewith, the
Preferred Shares submitted by such Holder for exchange or payment, as applicable, under this Section 6(b) may be converted, in whole
or in part, by such Holder into Common Stock pursuant to Section 4 or in the event the Conversion Date is after the consummation of such
Change of Control, stock or equity interests of the Successor Entity substantially equivalent to the Company’s shares of Common
Stock pursuant to Section 6(a). In the event of the Company’s repayment or exchange, as applicable, of any of the Preferred Shares
under this Section 6(b), such 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 a Holder.
Accordingly, any Required Premium due under this Section 6(b) is intended by the parties to be, and shall be deemed, a reasonable estimate
of such Holder’s actual loss of its investment opportunity and not as a penalty. Notwithstanding anything herein to the contrary,
in connection with any redemption hereunder at a time a Holder is entitled to receive a cash payment under any of the other Transaction
Documents, at the option of such Holder delivered in writing to the Company, the applicable redemption price hereunder shall be increased
by the amount of such cash payment owed to such Holder under such other Transaction Document and, upon payment in full or conversion
in accordance herewith, shall satisfy the Company’s payment obligation under such other Transaction Document.
7.
Rights Upon Issuance of Purchase Rights and Other Corporate Events.
(a)
Purchase Rights. In addition to any adjustments pursuant to Section 8 and Section 15 below, 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 all
or substantially all of the record holders of any class of Common Stock (the “Purchase Rights”), then each Holder
will be entitled to acquire, upon the terms applicable to such Purchase Rights, the aggregate Purchase Rights which such Holder could
have acquired if such Holder had held the number of shares of Common Stock acquirable upon complete conversion of all the Preferred Shares
(without taking into account any limitations or restrictions on the convertibility of the Preferred Shares and assuming for such purpose
that all the Preferred Shares were converted at the Alternate Conversion Price as of the applicable record date) held by such Holder
immediately prior to the date on which a record is taken for the grant, issuance or sale of such Purchase Rights, or, if no such record
is taken, the date as of which the record holders of shares of Common Stock are to be determined for the grant, issue or sale of such
Purchase Rights; provided, however, to the extent that such Holder’s right to participate in any such Purchase Right would result
in such Holder and the other Attribution Parties exceeding the Maximum Percentage, then such Holder shall not be entitled to participate
in such Purchase Right to such 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 such extent of any such excess) and such Purchase Right
to such extent shall be held in abeyance (and, if such Purchase Right has an expiration date, maturity date or other similar provision,
such term shall be extended by such number of days held in abeyance, if applicable) for the benefit of such Holder until such time or
times, if ever, as its right thereto would not result in such Holder and the other Attribution Parties exceeding the Maximum Percentage,
at which time or times such 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 (and, if such Purchase Right has an expiration date, maturity date
or other similar provision, such term shall be extended by such number of days held in abeyance, if applicable)) to the same extent as
if there had been no such limitation.
(b)
Other Corporate Events. In addition to and not in substitution for any other rights hereunder, prior to the consummation of any
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
ensure that each Holder will thereafter have the right, at such Holder’s option, to receive upon a conversion of all the Preferred
Shares held by such Holder (i) in addition to the shares of Common Stock receivable upon such conversion, such securities or other assets
(the “Corporate Event Consideration”) to which such Holder would have been entitled with respect to such shares of
Common Stock had such shares of Common Stock been held by such Holder upon the consummation of such Corporate Event (without taking into
account any limitations or restrictions on the convertibility of the Preferred Shares set forth in this Certificate of Designations)
or (ii) in lieu of the shares of Common Stock otherwise receivable upon such conversion, such securities or other assets received by
the holders of shares of Common Stock in connection with the consummation of such Corporate Event in such amounts as such Holder would
have been entitled to receive had the Preferred Shares held by such Holder initially been issued with conversion rights for the form
of such consideration (as opposed to shares of Common Stock) at a conversion rate for such consideration commensurate with the Conversion
Rate of an Alternate Conversion. Provision made pursuant the preceding sentence shall be in a form and substance satisfactory to each
of the Required Holders. The provisions of this Section 7 shall apply similarly and equally to successive Corporate Events and shall
be applied without regard to any limitations on the conversion or redemption of the Preferred Shares set forth in this Certificate of
Designations.
8.
Rights Upon Issuance of Other Securities.
(a)
Adjustment of Conversion Price upon Issuance of Common Stock. If and whenever on or after the Adjustment Measurement Commencement
Date the Company grants, issues or sells (or enters into any agreement to grant, issue or sell), or in accordance with this Section 8(a)
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 Conversion
Price in effect immediately prior to such granting, issuance or sale or deemed granting, issuance or sale (such Conversion Price then
in effect is referred to herein as the “Applicable Price”) (the foregoing a “Dilutive Issuance”),
then, immediately after such Dilutive Issuance, the Conversion 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 Conversion Price and the New Issuance
Price under this Section 8(a)), 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 of such Option for such price per share. For
purposes of this Section 8(a)(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 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 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 Conversion 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 8(a)(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 Conversion 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 Conversion Price has been or is to be made pursuant to other provisions of this Section 8(a),
except as contemplated below, no further adjustment of the Conversion 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 8(b)
below), the Conversion Price in effect at the time of such increase or decrease shall be adjusted to the Conversion 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 8(a)(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
8(a) shall be made if such adjustment would result in an increase of the Conversion 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 each of 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
8(a)(i) or 8(a)(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 any Preferred Shares are converted, on any given Conversion Date during
any such Adjustment Period, solely with respect to such Preferred Shares converted on such applicable Conversion Date, such applicable
Adjustment Period shall be deemed to have ended on, and included, the Trading Day immediately prior to such Conversion 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).
(b)
Adjustment of Conversion Price upon Subdivision or Combination of Common Stock. Without limiting any provision of Section 7 or
Section 15, if the Company at any time on or after the Initial Issuance Date subdivides (by any stock split, stock dividend, stock combination,
recapitalization or other similar transaction) one or more classes of its outstanding shares of Common Stock into a greater number of
shares, the Conversion Price in effect immediately prior to such subdivision will be proportionately reduced. Without limiting any provision
of Section 7 or Section 15, if the Company at any time on or after the Initial Issuance Date combines (by any stock split, stock dividend,
stock combination, recapitalization or other similar transaction) one or more classes of its outstanding shares of Common Stock into
a smaller number of shares, the Conversion Price in effect immediately prior to such combination will be proportionately increased. Any
adjustment pursuant to this Section 8(b) shall become effective immediately after the effective date of such subdivision or combination.
If any event requiring an adjustment under this Section 8(b) occurs during the period that a Conversion Price is calculated hereunder,
then the calculation of such Conversion Price shall be adjusted appropriately to reflect such event.
(c)
Holder’s Right of Adjusted Conversion Price. In addition to and not in limitation of the other provisions of this Section
8(c), if the Company in any manner issues or sells or enters into any agreement to issue or sell, any Common Stock, Options or Convertible
Securities (any such securities, “Variable Price Securities”) after the Adjustment Measurement Commencement Date that
are issuable pursuant to such agreement or convertible into or exchangeable or exercisable for shares of Common Stock at a price which
varies or may vary with the market price of the shares of Common Stock, including by way of one or more reset(s) to a fixed price, but
exclusive of such formulations reflecting share splits, share combinations, and share dividends (each of the formulations for such variable
price being herein referred to as, the “Variable Price”), the Company shall provide written notice thereof via electronic
mail and overnight courier to each Holder on the date of such agreement and/or the issuance of such shares of Common Stock, Convertible
Securities or Options, as applicable. From and after the date the Company enters into such agreement or issues any such Variable Price
Securities, each Holder shall have the right, but not the obligation, in its sole discretion to substitute the Variable Price for the
Conversion Price upon conversion of the Preferred Shares by designating in the Conversion Notice delivered upon any conversion of Preferred
Shares that solely for purposes of such conversion such Holder is relying on the Variable Price rather than the Conversion Price then
in effect. A Holder’s election to rely on a Variable Price for a particular conversion of Preferred Shares shall not obligate such
Holder to rely on a Variable Price for any future conversions of Preferred Shares.
(d)
[Reserved]
(e) Other
Events. In the event that the Company (or any Subsidiary) shall take any action to which the provisions hereof are not strictly
applicable, or, if applicable, would not operate to protect any Holder from dilution or if any event occurs of the type contemplated
by the provisions of this Section 8 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 Board shall in good faith
determine and implement an appropriate adjustment in the Conversion Price so as to protect the rights of such Holder, provided that
no such adjustment pursuant to this Section 8 €) will increase the Conversion Price as otherwise determined pursuant to this
Section 8, provided further that if such Holder does not accept such adjustments as appropriately protecting its interests hereunder
against such dilution, then the Board and such 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 8 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 issue 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 any
Preferred Shares remain outstanding, with the prior written consent of the Required Holder, reduce the then current Conversion Price
to any amount and for any period of time deemed appropriate by the Board.
(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 applicable
Securities Agreements) (each, an “Adjustment Date”), the Conversion Price then in effect is greater than the Market
Price then in effect (the “Adjustment Price”), on the Adjustment Date the Conversion Price shall automatically lower
to the Adjustment Price.
(i)
Exchange Right. Notwithstanding anything herein to the contrary, if a Holder participates in a Subsequent Placement, each such
Holder may, at the option of such Holder as elected in writing to the Company, satisfy the purchase price of the securities to be sold
to such Holder in such Subsequent Placement, in whole or in part, with Preferred Shares valued at 135% of the Conversion Amount of the
Preferred Shares delivered by such Holder as payment therefor.
(j)
Conversion Floor Price. Prior to the Stockholder Approval Date (as defined in the Securities Agreements), no adjustment pursuant
to this Section 2 shall cause the Conversion Price to be less than $2.595 (as adjusted for any stock dividend, stock split, stock combination,
reclassification or similar transaction occurring after the date of the Securities Agreements) (the “Conversion Floor Price”).
As of the Stockholder Approval Date, any Dilutive Issuances or other events that would have resulted in an adjustment to the Conversion
Price prior to the Stockholder Approval Date, but for the application of this Section 8(j), shall adjust the Conversion Price hereunder
as if such Dilutive Issuances and/or other events, as applicable, occurred on the Stockholder Approval Date.
9.
Redemption at the Company’s Election. At any time, the Company shall have the right to redeem all, but not less than all,
of the Preferred Shares then outstanding (the “Company Optional Redemption Amount”) on the Company Optional Redemption
Date (each as defined below) (a “Company Optional Redemption”). The Preferred Shares subject to redemption pursuant
to this Section 9 shall be redeemed by the Company in cash at a price (the “Company Optional Redemption Price”) equal
to 115% of the greater of (i) the Conversion Amount being redeemed as of the Company Optional Redemption Date and (ii) the product of
(1) the Conversion Rate with respect to the Conversion Amount being redeemed as of the Company Optional Redemption Date multiplied by
(2) the greatest Closing Sale Price of the Common Stock on any Trading Day during the period commencing on the date immediately preceding
such Company Optional Redemption Notice Date and ending on the Trading Day immediately prior to the date the Company makes the entire
payment required to be made under this Section 9. The Company may exercise its right to require redemption
under this Section 9 by delivering a written notice thereof by electronic mail and overnight courier to all, but not less than all, of
the Holders (the “Company Optional Redemption Notice” and the date all of the Holders received such notice is referred
to as the “Company Optional Redemption Notice Date”). The Company may deliver only one Company Optional Redemption
Notice hereunder and such Company Optional Redemption Notice shall be irrevocable. The Company Optional Redemption Notice shall (x) state
the date on which the Company Optional Redemption shall occur (the “Company Optional Redemption Date”) which date
shall not be less than ten (10) Trading Days nor more than twenty (20) Trading Days following the Company Optional Redemption Notice
Date, and (y) state the aggregate Conversion Amount of the Preferred Shares which is being redeemed in such Company Optional Redemption
from such Holder and all of the other Holders of the Preferred Shares pursuant to this Section 9 on the Company Optional Redemption Date.
The Company shall deliver the applicable Company Optional Redemption Price to each Holder in cash on the applicable Company Optional
Redemption Date. Notwithstanding anything herein to the contrary, at any time prior to the date the Company Optional Redemption Price
is paid, in full, the Company Optional Redemption Amount may be converted, in whole or in part, by any Holder into shares of Common Stock
pursuant to Section 4. All Conversion Amounts converted by a Holder after the Company Optional Redemption Notice Date shall reduce the
Company Optional Redemption Amount of the Preferred Shares of such Holder required to be redeemed on the Company Optional Redemption
Date. In the event of the Company’s redemption of any of the Preferred Shares under this Section 9, a 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 such Holder. Accordingly, any redemption premium due under this
Section 9 is intended by the parties to be, and shall be deemed, a reasonable estimate of such Holder’s actual loss of its investment
opportunity and not as a penalty. For the avoidance of doubt, the Company shall have no right to effect a Company Optional Redemption
if any Triggering Event has occurred and continuing, but any Triggering Event shall have no effect upon any Holder’s right to convert
Preferred Shares in its discretion.
10.
Noncircumvention. The Company hereby covenants and agrees that the Company will not, by amendment of its Certificate of Incorporation,
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 Certificate
of Designations, and will at all times in good faith carry out all the provisions of this Certificate of Designations and take all action
as may be required to protect the rights of the Holders hereunder. Without limiting the generality of the foregoing or any other provision
of this Certificate of Designations or the other Transaction Documents, the Company (a) shall not increase the par value of any shares
of Common Stock receivable upon the conversion of any Preferred Shares above the Conversion Price then in effect, (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 conversion of Preferred Shares and (c) shall, so long as any Preferred Shares are outstanding, take all
action necessary to reserve and keep available out of its authorized and unissued shares of Common Stock, solely for the purpose of effecting
the conversion of the Preferred Shares, the maximum number of shares of Common Stock as shall from time to time be necessary to effect
the conversion of the Preferred Shares then outstanding (without regard to any limitations on conversion contained herein). Notwithstanding
anything herein to the contrary, if after the sixty (60) calendar day anniversary of the Initial Issuance Date, each Holder is not permitted
to convert such Holder’s Preferred Shares in full for any reason (other than pursuant to restrictions set forth in Section 4(d)
hereof), the Company shall use its best efforts to promptly remedy such failure, including, without limitation, obtaining such consents
or approvals as necessary to effect such conversion into shares of Common Stock.
11.
Authorized Shares.
(a)
Reservation. So long as any Preferred Shares remain outstanding, the Company shall at all times reserve at least (x) if prior
to May 31, 2024 (or, if earlier, the Stockholder Approval Date (as defined in the Securities Agreements)) (the “Initial Reserve
Expiration Date”), the Initial Reserve Amount (as defined in the Securities Agreements) or (y) from and after the Initial Reserve
Expiration Date, 200% of the number of shares of Common Stock as shall from time to time be necessary to effect the conversion, including
without limitation, Alternate Conversions, of all of the Preferred Shares then outstanding at the Alternate Conversion Price then in
effect (without regard to any limitations on conversions) (the “Required Reserve Amount”). The Required Reserve Amount
(including, without limitation, each increase in the number of shares so reserved) shall be allocated pro rata among the Holders based
on the number of the Preferred Shares held by each Holder on the Initial Issuance Date 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 Preferred Shares, 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 Preferred Shares shall be
allocated to the remaining Holders of Preferred Shares, pro rata based on the number of the Preferred Shares then held by the Holders.
Notwithstanding the foregoing, a Holder may allocate its Authorized Share Allocation to any other of the securities of the Company held
by such Holder (or any of its designees) by delivery of a written notice to the Company.
(b)
Insufficient Authorized Shares. If, notwithstanding Section 11(a) and not in limitation thereof, at any time while any of the
Preferred Shares remain outstanding the Company does not have a sufficient number of authorized and unreserved shares of Common Stock
to satisfy its obligation to reserve for issuance upon conversion of the Preferred Shares at least a number of shares of Common Stock
equal to 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 the Preferred Shares then outstanding (or deemed outstanding pursuant to Section 11(a) above). 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 (or, if a majority of the voting power then in effect of the capital stock of the Company consents to such increase,
in lieu of such proxy statement, deliver to the stockholders of the Company an information statement that has been filed with (and either
approved by or not subject to comments from) the SEC with respect thereto). 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 to a Holder upon any conversion 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 “Authorized Failure Shares”), in lieu of delivering such Authorized Failure Shares to such Holder,
the Company shall pay cash in exchange for the redemption of such portion of the Conversion Amount of the Preferred Shares convertible
into such Authorized Failure Shares at a price equal to the sum of (i) the product of (x) such number of Authorized Failure Shares and
(y) the greatest Closing Sale Price of the Common Stock on any Trading Day during the period commencing on the date such Holder delivers
the applicable Conversion Notice with respect to such Authorized Failure Shares to the Company and ending on the date of such issuance
and payment under this Section 11(b); and (ii) to the extent such Holder purchases (in an open market transaction or otherwise) shares
of Common Stock to deliver in satisfaction of a sale by such Holder of Authorized Failure Shares, any brokerage commissions and other
out-of-pocket expenses, if any, of such Holder incurred in connection therewith.
12.
Voting Rights. The holders of the Preferred Shares shall have no voting power and no right to vote on any matter at any time,
either as a separate series or class or together with any other series or class of share of capital stock, and shall not be entitled
to call a meeting of such holders for any purpose nor shall they be entitled to participate in any meeting of the holders of Common Stock,
except as provided in this Section 12 and Section 16 or as otherwise required by the DGCL. To the extent that under the DGCL the vote
of the holders of the Preferred Shares, voting separately as a class or series, as applicable, is required to authorize a given action
of the Company, the affirmative vote or consent of each of the Required Holders of the Preferred Shares, voting together in the aggregate
and not in separate series unless required under the DGCL, represented at a duly held meeting at which a quorum is presented or by written
consent of each of the Required Holders (except as otherwise may be required under the DGCL), voting together in the aggregate and not
in separate series unless required under the DGCL, shall constitute the approval of such action by both the class or the series, as applicable.
Holders of the Preferred Shares shall be entitled to written notice of all stockholder meetings or written consents (and copies of proxy
materials and other information sent to stockholders) with respect to which they would be entitled to vote, which notice would be provided
pursuant to the Company’s bylaws (the “Bylaws”) and the DGCL.
13.
Covenants.
(a)
Restriction on Redemption and Cash Dividends. The Company shall not, and the Company shall cause each of its Subsidiaries to not,
directly or indirectly, redeem, repurchase or declare or pay any cash dividend or distribution on any of its capital stock (other than
as required by this Certificate of Designations).
(b)
Restriction on Transfer of Assets. The Company shall not, and the Company shall cause each of its Subsidiaries to not, directly
or indirectly, sell, lease, license, assign, transfer, spin-off, split-off, close, convey or otherwise dispose of any assets or rights
of the Company or any Subsidiary owned or hereafter acquired whether in a single transaction or a series of related transactions, other
than (i) sales, leases, licenses, assignments, transfers, conveyances and other dispositions of such assets or rights by the Company
and its Subsidiaries in the ordinary course of business consistent with its past practice and (ii) sales of inventory and product in
the ordinary course of business.
(c)
Change in Nature of Business. The Company shall not, and the Company shall cause each of its Subsidiaries to not, directly or
indirectly, engage in any material line of business substantially different from those lines of business conducted by or publicly contemplated
to be conducted by the Company and each of its Subsidiaries on the Subscription Date or any business substantially related or incidental
thereto. The Company shall not, and the Company shall cause each of its Subsidiaries to not, directly or indirectly, modify its or their
corporate structure or purpose.
(d)
Preservation of Existence, Etc. The Company shall maintain and preserve, and cause each of its Subsidiaries to maintain and preserve,
its existence, rights and privileges, and become or remain, and cause each of its Subsidiaries to 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.
(e)
Maintenance of Properties, Etc. The Company shall maintain and preserve, and cause each of its Subsidiaries to 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, and cause each of its Subsidiaries to 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.
(f)
Maintenance of Intellectual Property. The Company will, and will cause each of its Subsidiaries to, take all action necessary
or advisable to maintain all of the Intellectual Property Rights of the Company and/or any of its Subsidiaries that are necessary or
material to the conduct of its business in full force and effect.
(g)
Maintenance of Insurance. The Company shall maintain, and cause each of its Subsidiaries to 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.
(h)
Transactions with Affiliates. The Company shall not, nor shall it permit any of its Subsidiaries to, enter into, renew, extend
or be a party to, any transaction or series of related transactions (including, without limitation, the purchase, sale, lease, transfer
or exchange of property or assets of any kind or the rendering of services of any kind) with any affiliate, except transactions 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.
(i)
Restricted Issuances. The Company shall not, directly or indirectly, without the prior written consent of each of the Required
Holders, (i) issue any Preferred Shares (other than as contemplated by the Merger Agreement, the Securities Agreements, the Exchange
Agreement and this Certificate of Designations), or (ii) issue any other securities that would cause a breach or default under this Certificate
of Designations.
(j)
Stay, Extension and Usury Laws. To the extent that it may lawfully do so, the Company (A) agrees that it will not at any time
insist upon, plead, or in any manner whatsoever claim or take the benefit or advantage of, any stay, extension or usury law (wherever
or whenever enacted or in force) that may affect the covenants or the performance of this Certificate of Designations; and (B) expressly
waives all benefits or advantages of any such law and agrees that it will not, by resort to any such law, hinder, delay or impede the
execution of any power granted to the Holders by this Certificate of Designations, but will suffer and permit the execution of every
such power as though no such law has been enacted.
(k)
Taxes. The Company and its Subsidiaries shall pay when due all taxes, fees or other charges of any nature whatsoever (together
with any related interest or penalties) now or hereafter imposed or assessed against the Company and its Subsidiaries or their respective
assets or upon their ownership, possession, use, operation or disposition thereof or upon their rents, receipts or earnings arising therefrom
(except where the failure to pay would not, individually or in the aggregate, have a material effect on the Company or any of its Subsidiaries).
The Company and its Subsidiaries shall file on or before the due date therefor all personal property tax returns (except where the failure
to file would not, individually or in the aggregate, have a material effect on the Company or any of its Subsidiaries). Notwithstanding
the foregoing, the Company and its Subsidiaries may contest, in good faith and by appropriate proceedings, taxes for which they maintain
adequate reserves therefor in accordance with GAAP.
(l)
PCAOB Registered Auditor. At all times any Preferred Shares remain outstanding, the Company shall have engaged an independent
auditor to audit its financial statements that is registered with (and in compliance with the rules and regulations of) the Public Company
Accounting Oversight Board.
(m)
Independent Investigation. At the request of any Holder either (x) at any time when a Triggering Event has occurred and is continuing,
(y) upon the occurrence of an event that with the passage of time or giving of notice would constitute a Triggering Event or (z) at any
time such Holder reasonably believes a Triggering Event may have occurred or be continuing, the Company shall hire an independent, reputable
investment bank selected by the Company and approved by such Holder to investigate as to whether any breach of this Certificate of Designations
has occurred (the “Independent Investigator”). If the Independent Investigator determines that such breach of this
Certificate of Designations has occurred, the Independent Investigator shall notify the Company of such breach and the Company shall
deliver written notice to each Holder of such breach. In connection with such investigation, the Independent Investigator may, during
normal business hours, inspect all contracts, books, records, personnel, offices and other facilities and properties of the Company and
its Subsidiaries and, to the extent available to the Company after the Company uses reasonable efforts to obtain them, the records of
its legal advisors and accountants (including the accountants’ work papers) and any books of account, records, reports and other
papers not contractually required of the Company to be confidential or secret, or subject to attorney-client or other evidentiary privilege,
and the Independent Investigator may make such copies and inspections thereof as the Independent Investigator may reasonably request.
The Company shall furnish the Independent Investigator with such financial and operating data and other information with respect to the
business and properties of the Company as the Independent Investigator may reasonably request. The Company shall permit the Independent
Investigator to discuss the affairs, finances and accounts of the Company with, and to make proposals and furnish advice with respect
thereto to, the Company’s officers, directors, key employees and independent public accountants or any of them (and by this provision
the Company authorizes said accountants to discuss with such Independent Investigator the finances and affairs of the Company and any
Subsidiaries), all at such reasonable times, upon reasonable notice, and as often as may be reasonably requested.
14.
Liquidation, Dissolution, Winding-Up. In the event of a Liquidation Event, the Holders shall be entitled to receive in cash out
of the assets of the Company, whether from capital or from earnings available for distribution to its stockholders (the “Liquidation
Funds”), before any amount shall be paid to the holders of any of shares of Junior Stock, after any Senior Preferred Stock
then outstanding, but pari passu with any Parity Stock then outstanding, an amount per Preferred Share equal to the greater of (A) 125%
of the Conversion Amount of such Preferred Share on the date of such payment and (B) the amount per share such Holder would receive if
such Holder converted such Preferred Share into Common Stock (at the Alternate Conversion Price then in effect) immediately prior to
the date of such payment, provided that if the Liquidation Funds are insufficient to pay the full amount due to the Holders and holders
of shares of Parity Stock, then each Holder and each holder of Parity Stock shall receive a percentage of the Liquidation Funds equal
to the full amount of Liquidation Funds payable to such Holder and such holder of Parity Stock as a liquidation preference, in accordance
with their respective certificate of designations (or equivalent), as a percentage of the full amount of Liquidation Funds payable to
all holders of Preferred Shares and all holders of shares of Parity Stock. To the extent necessary, the Company shall cause such actions
to be taken by each of its Subsidiaries so as to enable, to the maximum extent permitted by law, the proceeds of a Liquidation Event
to be distributed to the Holders in accordance with this Section 14. All the preferential amounts to be
paid to the Holders under this Section 14 shall be paid or set apart for payment before the payment or setting apart for payment of any
amount for, or the distribution of any Liquidation Funds of the Company to the holders of shares of Junior Stock in connection with a
Liquidation Event as to which this Section 14 applies.
15.
Distribution of Assets. In addition to any adjustments pursuant to Section 7 and Section 8, if the Company shall declare or make
any dividend or other distributions of its assets (or rights to acquire its assets) to any or all holders of shares of Common Stock,
by way of return of capital or otherwise (including without limitation, any distribution of cash, stock or other securities, property
or options by way of a dividend, spin off, reclassification, corporate rearrangement, scheme of arrangement or other similar transaction)
(the “Distributions”), then each Holder, as holders of Preferred Shares, will be entitled to such Distributions as
if such Holder had held the number of shares of Common Stock acquirable upon complete conversion of the Preferred Shares (without taking
into account any limitations or restrictions on the convertibility of the Preferred Shares and assuming for such purpose that the Preferred
Share was converted at the Alternate Conversion Price as of the applicable record date) immediately prior to 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 Common Stock are to be determined
for such Distributions (provided, however, that to the extent that such Holder’s right to participate in any such
Distribution would result in such Holder and the other Attribution Parties exceeding the Maximum Percentage, then such Holder shall not
be entitled to participate in such Distribution to such 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 such extent of any such excess) and the
portion of such Distribution shall be held in abeyance for the benefit of such Holder until such time or times as its right thereto would
not result in such Holder and the other Attribution Parties exceeding the Maximum Percentage, at which time or times, if any, such 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).
16.
Vote to Change the Terms of or Issue Preferred Shares. In addition to any other rights provided by law, except where the vote
or written consent of the holders of a greater number of shares is required by law or by another provision of the Certificate of Incorporation,
without first obtaining the affirmative vote at a meeting duly called for such purpose or the written consent without a meeting of each
of the Required Holders, voting together as a single class, the Company shall not: (a) amend or repeal any provision of, or add any provision
to, its certificate of Incorporation or bylaws, or file any certificate of designations or articles of amendment of any series of shares
of preferred stock, if such action would adversely alter or change in any respect the preferences, rights, privileges or powers, or restrictions
provided for the benefit of the Preferred Shares hereunder, regardless of whether any such action shall be by means of amendment to the
Certificate of Incorporation or by merger, consolidation or otherwise; (b) increase or decrease (other than by conversion) the authorized
number of shares of Series C-1 Convertible Preferred Stock; (c) without limiting any provision of Section 2,
create or authorize (by reclassification or otherwise) any new class or series of Senior Preferred Stock or Parity Stock, other than
any Merger Senior Preferred Stock to be issued pursuant to the transactions contemplated by the Merger Agreement, any Parity Stock to
be issued pursuant to the transactions contemplated by the Merger Agreement and any Merger Parity Stock; (d) purchase, repurchase or
redeem any shares of Junior Stock (other than pursuant to the terms of the Company’s equity incentive plans and options and other
equity awards granted under such plans (that have in good faith been approved by the Board)); (e) without limiting any provision of Section
2, pay dividends or make any other distribution on any shares of any Junior Stock; (f) issue any Preferred Shares other than as contemplated
hereby or pursuant to the Exchange Agreements, the Securities Agreements or the Merger Agreement; or (g) without limiting any provision
of Section 10, whether or not prohibited by the terms of the Preferred Shares, circumvent a right of the Preferred Shares hereunder.
17.
Transfer of Preferred Shares. A Holder may offer, sell or transfer some or all of its Preferred Shares without the consent of
the Company subject only to the provisions of Section 5 of the applicable Securities Agreement.
18.
Reissuance of Preferred Share Certificates and Book Entries.
(a)
Transfer. If any Preferred Shares are to be transferred, the applicable Holder shall surrender the applicable Preferred Share
Certificate to the Company (or, if the Preferred Shares are held in Book-Entry form, a written instruction letter to the Company), whereupon
the Company will forthwith issue and deliver upon the order of such Holder a new Preferred Share Certificate (in accordance with Section
18(d)) (or evidence of the transfer of such Book-Entry), registered as such Holder may request, representing the outstanding number of
Preferred Shares being transferred by such Holder and, if less than the entire outstanding number of Preferred Shares is being transferred,
a new Preferred Share Certificate (in accordance with Section 18(d)) to such Holder representing the outstanding number of Preferred
Shares not being transferred (or evidence of such remaining Preferred Shares in a Book-Entry for such Holder). Such Holder and any assignee,
by acceptance of the Preferred Share Certificate or evidence of Book-Entry issuance, as applicable, acknowledge and agree that, by reason
of the provisions of Section 4(c)(i) following conversion or redemption of any of the Preferred Shares, the outstanding number of Preferred
Shares represented by the Preferred Shares may be less than the number of Preferred Shares stated on the face of the Preferred Shares.
(b)
Lost, Stolen or Mutilated Preferred Share Certificate. Upon receipt by the Company of evidence reasonably satisfactory to the
Company of the loss, theft, destruction or mutilation of a Preferred Share Certificate (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 applicable Holder to the Company in customary and reasonable form and, in the case of mutilation, upon surrender and cancellation
of such Preferred Share Certificate, the Company shall execute and deliver to such Holder a new Preferred Share Certificate (in accordance
with Section 18(d)) representing the applicable outstanding number of Preferred Shares.
(c)
Preferred Share Certificate and Book-Entries Exchangeable for Different Denominations and Forms. Each Preferred Share Certificate
is exchangeable, upon the surrender hereof by the applicable Holder at the principal office of the Company, for a new Preferred Share
Certificate or Preferred Share Certificate(s) or new Book-Entry (in accordance with Section 18(d)) representing, in the aggregate, the
outstanding number of the Preferred Shares in the original Preferred Share Certificate, and each such new Preferred Share Certificate
and/or new Book-Entry, as applicable, will represent such portion of such outstanding number of Preferred Shares from the original Preferred
Share Certificate as is designated in writing by such Holder at the time of such surrender. Each Book-Entry may be exchanged into one
or more new Preferred Share Certificates or split by the applicable Holder by delivery of a written notice to the Company into two or
more new Book-Entries (in accordance with Section 18(d)) representing, in the aggregate, the outstanding number of the Preferred Shares
in the original Book-Entry, and each such new Book-Entry and/or new Preferred Share Certificate, as applicable, will represent such portion
of such outstanding number of Preferred Shares from the original Book-Entry as is designated in writing by such Holder at the time of
such surrender.
(d)
Issuance of New Preferred Share Certificate or Book-Entry. Whenever the Company is required to issue a new Preferred Share Certificate
or a new Book-Entry pursuant to the terms of this Certificate of Designations, such new Preferred Share Certificate or new Book-Entry
(i) shall represent, as indicated on the face of such Preferred Share Certificate or in such Book-Entry, as applicable, the number of
Preferred Shares remaining outstanding (or in the case of a new Preferred Share Certificate or new Book-Entry being issued pursuant to
Section 18(a) or Section 18(c), the number of Preferred Shares designated by such Holder) which, when added to the number of Preferred
Shares represented by the other new Preferred Share Certificates or other new Book-Entry, as applicable, issued in connection with such
issuance, does not exceed the number of Preferred Shares remaining outstanding under the original Preferred Share Certificate or original
Book-Entry, as applicable, immediately prior to such issuance of new Preferred Share Certificate or new Book-Entry, as applicable, and
(ii) shall have an issuance date, as indicated on the face of such new Preferred Share Certificate or in such new Book-Entry, as applicable,
which is the same as the issuance date of the original Preferred Share Certificate or in such original Book-Entry, as applicable.
19.
Remedies, Characterizations, Other Obligations, Breaches and Injunctive Relief. The remedies provided in this Certificate of Designations
shall be cumulative and in addition to all other remedies available under this Certificate of Designations and any of the other Transaction
Documents, at law or in equity (including a decree of specific performance and/or other injunctive relief), and nothing herein shall
limit any Holder’s right to pursue actual and consequential damages for any failure by the Company to comply with the terms of
this Certificate of Designations. No failure on the part of a Holder to exercise, and no delay in exercising, any right, power or remedy
hereunder shall operate as a waiver thereof; nor shall any single or partial exercise by such Holder of any right, power or remedy preclude
any other or further exercise thereof or the exercise of any other right, power or remedy. In addition, the exercise of any right or
remedy of a Holder at law or equity or under this Certificate of Designations or any of the documents shall not be deemed to be an election
of such Holder’s rights or remedies under such documents or at law or equity. The Company covenants to each Holder that there shall
be no characterization concerning this instrument other than as expressly provided herein. Amounts set forth or provided for herein with
respect to payments, conversion and the like (and the computation thereof) shall be the amounts to be received by a Holder and shall
not, except as expressly provided herein, be subject to any other obligation of the Company (or the performance thereof). No failure
on the part of a Holder to exercise, and no delay in exercising, any right, power or remedy hereunder shall
operate as a waiver thereof; nor shall any single or partial exercise by such Holder of any right, power or remedy preclude any other
or further exercise thereof or the exercise of any other right, power or remedy. In addition, the exercise of any right or remedy of
any Holder at law or equity or under Preferred Shares or any of the documents shall not be deemed to be an election of such Holder’s
rights or remedies under such documents or at law or equity. The Company acknowledges that a breach by it of its obligations hereunder
will cause irreparable harm to the Holders 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, each Holder 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 a Holder that is requested by such Holder to enable such Holder to confirm the Company’s
compliance with the terms and conditions of this Certificate of Designations.
20.
Payment of Collection, Enforcement and Other Costs. If (a) any Preferred Shares are placed in the hands of an attorney for collection
or enforcement or is collected or enforced through any legal proceeding or a Holder otherwise takes action to collect amounts due under
this Certificate of Designations with respect to the Preferred Shares or to enforce the provisions of this Certificate of Designations
or (b) there occurs any bankruptcy, reorganization, receivership of the Company or other proceedings affecting Company creditors’
rights and involving a claim under this Certificate of Designations, then the Company shall pay the costs incurred by such 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. The Company expressly acknowledges and agrees that no amounts due under
this Certificate of Designations with respect to any Preferred Shares shall be affected, or limited, by the fact that the purchase price
paid for each Preferred Share was less than the original Stated Value thereof.
21.
Construction; Headings. This Certificate of Designations shall be deemed to be jointly drafted by the Company and the Holders
and shall not be construed against any such Person as the drafter hereof. The headings of this Certificate of Designations are for convenience
of reference and shall not form part of, or affect the interpretation of, this Certificate of Designations. 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 Certificate of Designations instead of just the provision in which they are found. Unless
expressly indicated otherwise, all section references are to sections of this Certificate of Designations. Terms used in this Certificate
of Designations and not otherwise defined herein, but defined in the other Transaction Documents, shall have the meanings ascribed to
such terms on the Initial Issuance Date in such other Transaction Documents unless otherwise consented to in writing by each of the Required
Holders.
22.
Failure or Indulgence Not Waiver. No failure or delay on the part of a 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. This Certificate of Designations shall be deemed to be jointly drafted by
the Company and all Holders and shall not be construed against any Person as the drafter hereof. Notwithstanding the foregoing, nothing
contained in this Section 22 shall permit any waiver of any provision of Section 4(d).
23.
Dispute Resolution.
(a)
Submission to Dispute Resolution.
(i)
In the case of a dispute relating to a Closing Bid Price, a Closing Sale Price, a Conversion Price, an Alternate Conversion Price, a
VWAP or a fair market value or the arithmetic calculation of a Conversion Rate, or the applicable redemption price (as the case may be)
(including, without limitation, a dispute relating to the determination of any of the foregoing), the Company or the applicable Holder
(as the case may be) shall submit the dispute to the other party via electronic mail (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 such Holder at any time after such Holder learned
of the circumstances giving rise to such dispute. If such Holder and the Company are unable to promptly resolve such dispute relating
to such Closing Bid Price, such Closing Sale Price, such Conversion Price, such Alternate Conversion Price, such VWAP or such fair market
value, or the arithmetic calculation of such Conversion Rate or such applicable redemption price (as the case may be), at any time after
the second (2nd) Business Day following such initial notice by the Company or such Holder (as the case may be) of such dispute
to the Company or such Holder (as the case may be), then such Holder may, at its sole option, select an independent, reputable investment
bank to resolve such dispute.
(ii)
Such 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 23 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 such
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 such 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 such
Holder or otherwise requested by such investment bank, neither the Company nor such 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 such Holder shall cause such investment bank to determine the resolution of such dispute and notify the Company and such
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 23 constitutes an agreement to arbitrate between
the Company and each Holder (and constitutes an arbitration agreement) under the rules then in effect under Delaware Rapid Arbitration
Act, as amended, (ii) the terms of this Certificate of Designations 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 and in resolving such dispute such investment bank shall apply
such findings, determinations and the like to the terms of this Certificate of Designations and any other applicable Transaction Documents,
(iii) the applicable Holder (and only such Holder with respect to disputes solely relating to such Holder), in its sole discretion, shall
have the right to submit any dispute described in this Section 23 to any state or federal court sitting in Wilmington Delaware, in lieu
of utilizing the procedures set forth in this Section 23 and (iv) nothing in this Section 23 shall limit such Holder from obtaining any
injunctive relief or other equitable remedies (including, without limitation, with respect to any matters described in this Section 23).
24.
Notices; Currency; Payments.
(a)
Any notices, consents, waivers or other communications required or permitted to be given under the terms of this Certificate of Designations
must be in writing and will be deemed to have been delivered on the earliest of: (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 address and e-mail address for any
such communications to the Company shall be: Aditxt, Inc., 737 N. Fifth Street, Suite 200, Richmond, VA 23219, Attention: Amro Albanna,
e-mail address: aalbanna@aditxt.com, or such other mailing address and/or e-mail address as the Company has specified by written notice
given to each of the Holders in accordance with this Section 24(a) not later than five (5) days prior to the effectiveness of such change.
The mailing address and e-mail address for any such communications to any Holder shall be as set forth on such Holder’s respective
signature page to the applicable Securities Agreement and/or Exchange Agreement, as applicable, or such other mailing address and/or
e-mail address as such Holder has specified by written notice given to the Company in accordance with this Section 24(a) not later than
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 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.
(b)
The Company shall provide each Holder with prompt written notice of all actions taken pursuant to this Certificate of Designations, including
in reasonable detail a description of such action and the reason therefore. Without limiting the generality of the foregoing, the Company
shall give written notice to each Holder (i) immediately upon any adjustment of the Conversion Price, setting forth in reasonable detail,
and certifying, the calculation of such adjustment 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 Common Stock, or (B) 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 such Holder.
(c) Currency.
All dollar amounts referred to in this Certificate of Designations are in United States Dollars (“U.S. Dollars”),
and all amounts owing under this Certificate of Designations 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 Certificate of Designations, the U.S. Dollar exchange rate as published in the Wall Street Journal on the relevant
date of calculation (it being understood and agreed that where an amount is calculated with reference to, or over, a period of time,
the date of calculation shall be the final date of such period of time).
(d)
Payments. Whenever any payment of cash is to be made by the Company to any Person pursuant to this Certificate of Designations,
unless otherwise expressly set forth herein, such payment shall be made in lawful money of the United States of America by wire transfer
of immediately available funds pursuant to wire transfer instructions that Holder shall provide to the Company in writing from time to
time. Whenever any amount expressed to be due by the terms of this Certificate of Designations 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.
Waiver of Notice. To the extent permitted by law, the Company hereby irrevocably waives demand, notice, presentment, protest and
all other demands and notices in connection with the delivery, acceptance, performance, default or enforcement of this Certificate of
Designations and the Securities Agreements.
26.
Governing Law. This Certificate of Designations shall be construed and enforced in accordance with, and all questions concerning
the construction, validity, interpretation and performance of this Certificate of Designations shall be governed by, the internal laws
of the State of Delaware, without giving effect to any choice of law or conflict of law provision or rule (whether of the State of Delaware
or any other jurisdictions) that would cause the application of the laws of any jurisdictions other than the State of Delaware. Except
as otherwise required by Section 23 above, the Company hereby irrevocably submits to the exclusive jurisdiction of the state and federal
courts sitting in Wilmington, Delaware, 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 to limit in any way any
right to serve process in any manner permitted by law. Nothing contained herein (i) shall be deemed or operate to preclude any Holder
from bringing suit or taking other legal action against the Company in any other jurisdiction to collect on the Company’s obligations
to such 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 such Holder or (ii) shall limit, or shall be deemed or construed to limit, any provision of Section 23 above. 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 CERTIFICATE OF DESIGNATIONS OR ANY TRANSACTION CONTEMPLATED HEREBY.
27.
Judgment Currency.
(a)
If for the purpose of obtaining or enforcing judgment against the Company in any court in any jurisdiction it becomes necessary to convert
into any other currency (such other currency being hereinafter in this Section 27 referred to as the “Judgment Currency”)
an amount due in U.S. Dollars under this Certificate of Designations, the conversion shall be made at the Exchange Rate prevailing on
the Trading Day immediately preceding:
(i)
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
(ii)
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 27(a)(ii) being hereinafter referred to as the “Judgment Conversion Date”).
(b)
If in the case of any proceeding in the court of any jurisdiction referred to in Section 27(a)(ii) 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.
(c)
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 Certificate of Designations.
28.
TAXES.
(a)
All payments made by the Company hereunder or under any other Transaction Document shall be made in accordance with the terms of the
respective Transaction Document and shall be made without set-off, counterclaim, withholding, deduction or other defense. Without limiting
the foregoing, all such payments shall be made free and clear of and without deduction or withholding for any present or future taxes,
levies, imposts, deductions, charges or withholdings, and all liabilities with respect thereto, excluding (i) taxes imposed on the net
income of a Holder by the jurisdiction in which such Holder is organized or where it has its principal lending office, (ii) with respect
to any payments made by the Company hereunder, taxes (including, but not limited to, backup withholding) to the extent such taxes are
imposed due to the failure of the applicable recipient of such payment to provide the Company with whichever (if any) is applicable of
valid and properly completed and executed IRS Forms W-9, W-8BEN, W-8BEN-E, W-8ECI, and/or W-8IMY, when requested in writing by the Company,
and (iii) with respect to any payments made by the Company, taxes to the extent such taxes are imposed due to the failure of the applicable
recipient of such payment to comply with FATCA (all such nonexcluded taxes, levies, imposts, deductions, charges, withholdings and liabilities,
collectively or individually, “Taxes”). If the Company shall be required to deduct or to withhold any Taxes from or
in respect of any amount payable hereunder or under any other Transaction Document:
(i)
the amount so payable shall be increased to the extent necessary so that after making all required deductions and withholdings (including
Taxes on amounts payable to a Holder pursuant to this sentence) such Holder receives an amount equal to the sum it would have received
had no such deduction or withholding been made,
(ii)
the Company shall make such deduction or withholding,
(iii)
the Company shall pay the full amount deducted or withheld to the relevant Governmental Authority in accordance with applicable law,
and
(iv)
as promptly as possible thereafter, the Company shall send such Holder an official receipt (or, if an official receipt is not available,
such other documentation as shall be satisfactory to such Holder, as the case may be) showing payment. In addition, the Company agrees
to pay any present or future stamp or documentary taxes or any other excise or property taxes, charges or similar levies that arise from
any payment made hereunder or from the execution, delivery, registration or enforcement of, or otherwise with respect to, this Preferred
Shares or any other Transaction Document (collectively, “Other Taxes”).
(b)
The Company hereby indemnifies and agrees to hold each Holder and each of their affiliates and their respective officers, directors,
employees, agents and advisors (each, an “Indemnified Party”) each Indemnified Party harmless from and against Taxes
or Other Taxes (including, without limitation, any Taxes or Other Taxes imposed by any jurisdiction on amounts payable under this Section
28) paid by any Indemnified Party as a result of any payment made hereunder or from the execution, delivery, registration or enforcement
of, or otherwise with respect to, this Preferred Shares or any other Transaction Document, and any liability (including penalties, interest
and expenses for nonpayment, late payment or otherwise) arising therefrom or with respect thereto, whether or not such Taxes or Other
Taxes were correctly or legally asserted. This indemnification shall be paid within thirty (30) days from the date on which such Holder
makes written demand therefor, which demand shall identify the nature and amount of such Taxes or Other Taxes.
(c)
If the Company fails to perform any of its obligations under this Section 28, the Company shall indemnify such Holder for any taxes,
interest or penalties that may become payable as a result of any such failure. The obligations of the Company under this Section 28 shall
survive the repayment and/or conversion, as applicable, in full of the Preferred Shares and all other amounts payable with respect thereto.
(d)
If any Indemnified Party determines, in its sole discretion exercised in good faith, that it has received a refund of any Taxes as to
which it has been indemnified pursuant to this Section 28 (including by the payment of additional amounts pursuant to this Section 28),
it shall pay to the indemnifying party an amount equal to such refund (but only to the extent of indemnity payments made under this Section
28 with respect to the Taxes giving rise to such refund), net of all out-of-pocket expenses (including taxes) of such Indemnified Party
and without interest (other than any interest paid by the relevant Governmental Authority with respect to such refund). Such indemnifying
party, upon the request of such Indemnified Party, shall repay to such Indemnified Party the amount paid over pursuant to this paragraph
(d) (plus any penalties, interest, or other charges imposed by the relevant Governmental Authority) in the event that such Indemnified
Party is required to repay such refund to such Governmental Authority. Notwithstanding anything to the contrary in this paragraph (d),
in no event will the Indemnified Party be required to pay any amount to an indemnifying party pursuant to this paragraph (d) the payment
of which would place the Indemnified Party in a less favorable net after-Tax position than the Indemnified Party would have been in if
the Tax subject to indemnification and giving rise to such refund had not been deducted, withheld or otherwise imposed and the indemnification
payments or additional amounts with respect to such Tax had never been paid. This paragraph (d) shall not be construed to require any
Indemnified Party to make available its Tax returns (or any other information relating to its Taxes that it deems confidential) to the
indemnifying party or any other Person.
29.
Severability. If any provision of this Certificate of Designations 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 Certificate of Designations so long as this Certificate of
Designations 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).
30.
Maximum Payments. Nothing contained herein shall be deemed to establish or require the payment of a rate of interest or other
charges in excess of the maximum permitted by applicable law. In the event that the rate of interest required to be paid or other charges
hereunder exceed the maximum permitted by such law, any payments in excess of such maximum shall be credited against amounts owed by
the Company to the applicable Holder and thus refunded to the Company.
31.
Stockholder Matters; Amendment; Transactions Related to the Merger Agreement, and Other Acquisitions or Strategic Transactions.
(a)
Stockholder Matters. Any stockholder action, approval or consent required, desired or otherwise sought by the Company pursuant
to the DGCL, the Certificate of Incorporation, this Certificate of Designations or otherwise with respect to the issuance of Preferred
Shares may be effected by written consent of the Company’s stockholders or at a duly called meeting of the Company’s stockholders,
all in accordance with the applicable rules and regulations of the DGCL. This provision is intended to comply with the applicable sections
of the DGCL permitting stockholder action, approval and consent affected by written consent in lieu of a meeting.
(b)
Amendment. Except for Section 4(d), which may not be amended or waived hereunder, this Certificate of Designations or any provision
hereof may be amended by obtaining the affirmative vote at a meeting duly called for such purpose, or written consent without a meeting
in accordance with the DGCL, of each of the Required Holders, voting separate as a single class, and with such other stockholder approval,
if any, as may then be required pursuant to the DGCL and the Certificate of Incorporation. Except
(a) to the extent otherwise expressly provided in this Certificate of Designations or the Certificate of Incorporation with respect
to voting or approval rights of a particular class or series of capital stock or (b) to the extent otherwise provided pursuant to
the DGCL, the holders of each outstanding class or series of shares of the Company shall not be entitled to vote as a separate voting
group on any amendment to the terms of this Certificate of Designations with respect to which such class or series would otherwise be
entitled under the DGCL to vote as a separate voting group.
(c)
Transactions Related to the Merger Agreement and Other Acquisitions or Strategic Transactions.
Notwithstanding the foregoing, nothing herein shall restrict or otherwise prohibit any term or condition of the Merger Agreement,
any agreement resulting in the issuance of Merger Parity Stock, or the transactions contemplated thereby, including without limitation,
the filing of one or more certificates of designations with any secretary of state with respect thereto and the issuance of the Merger
Senior Preferred Stock, Advisory Parity Stock and/or Parity Stock, as applicable, in accordance therewith.
32.
Certain Defined Terms. For purposes of this Certificate of Designations, 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)
“Additional Amount” means, as of the applicable date of determination, with respect to each Preferred Share, all declared
and unpaid Dividends on such Preferred Share.
(d)
“Adjustment Measurement Commencement Date” means January 1, 2023.
(e)
“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 8(a)) of shares of Common Stock (other than rights of
the type described in Section 7(a) 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).
(f)
“Affiliate” or “Affiliated” 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.
(g)
“Alternate Conversion Floor Amount” means an amount equal to the product obtained by multiplying (A) the higher of
(I) the highest price that the Common Stock trades at on the Trading Day immediately preceding the relevant Alternate Conversion Date
and (II) the applicable Alternate Conversion Price and (B) the difference obtained by subtracting (I) the number of shares of Common
Stock delivered (or to be delivered) to such Holder on the applicable Share Delivery Deadline with respect to such Alternate Conversion
from (II) the quotient obtained by dividing (x) the applicable Conversion Amount that such Holder has elected to be the subject of the
applicable Alternate Conversion, by (y) the applicable Alternate Conversion Price without giving effect to clause (x) of such definition.
(h)
“Alternate Conversion Price” means, with respect to any Alternate Conversion that price which shall be the lowest
of (i) the applicable Conversion Price as in effect on the applicable Conversion Date of the applicable Alternate Conversion, and (ii)
the greater of (x) the Floor Price and (y) 80% of the lowest VWAP of the Common Stock during the five (5) consecutive Trading Day period
ending and including the Trading Day immediately preceding the delivery or deemed delivery of the applicable Conversion Notice (such
period, the “Alternate Conversion Measuring Period”). All such determinations to be appropriately adjusted for any
stock dividend, stock split, stock combination, reclassification or similar transaction that proportionately decreases or increases the
Common Stock during such Alternate Conversion Measuring Period.
(i)
“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 shares of Common Stock issuable upon conversion
of the Preferred Shares then outstanding and (B) the date the Preferred Shares 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).
(j)
“Approved Stock Plan” means any employee benefit plan or agreement which has been approved by the Board prior to or
subsequent to the Subscription Date pursuant to which shares of Common Stock and standard options to purchase Common Stock may be issued
to any employee, officer, consultant or director for services provided to the Company in their capacity as such.
(k)
“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 Initial Issuance Date, directly or indirectly
managed or advised by a Holder’s investment manager or any of its Affiliates or principals, (ii) any direct or indirect Affiliates
of such Holder or any of the foregoing, (iii) any Person acting or who could be deemed to be acting as a Group together with such 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 such 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 such Holder and all other Attribution Parties to the Maximum Percentage.
(l)
“Bloomberg” means Bloomberg, L.P.
(m)
“Book-Entry” means each entry on the Register evidencing one or more Preferred Shares held by a Holder in lieu of
a Preferred Share Certificate issuable hereunder.
(n)
[Reserved].
(o)
“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.
(p)
“Change of Control” means any Fundamental Transaction other than (i) any merger of the Company or any of its, direct
or indirect, wholly-owned Subsidiaries with or into any of the foregoing Persons, (ii) any reorganization, recapitalization or reclassification
of the shares of 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, in all material respects, the holders 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 (iii) pursuant to a migratory merger effected
solely for the purpose of changing the jurisdiction of incorporation of the Company or any of its Subsidiaries and (iv) any merger or
acquisition of any business by the Company, directly or indirectly, in which either (x) the holders of the Company’s voting power
to elect the board of directors of the Company immediately prior to such merger or acquisition continue after such merger or acquisition
to have the voting power to elect a majority of the board of directors of the Company or (y) the Company shall not, 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 (1) at least 10% of the aggregate ordinary
voting power represented by issued and outstanding Common Stock, (2) at least 10% 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 Certificate of Designations calculated
as if any shares of Common Stock held by all such Subject Entities were not outstanding, or (3) 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 elect a majority of the directors of the Board of Directors of the Company (and, in either case, a majority
of the directors on the board of directors of the Company immediately prior to such merger or acquisition continue after such merger
or acquisition to be a majority of the directors on the board of directors of the Company). Notwithstanding the foregoing, the transactions
contemplated by the Merger Agreement, or any agreement resulting in the issuance of Merger Parity Stock or Advisory Parity Stock shall
not be deemed a Change of Control.
(q)
“Change of Control Election Price” means, with respect to any given Change of Control, such price equal to the greatest
of (i) the product of (A) the Required Premium multiplied by (B) the Conversion Amount of the Preferred Shares subject to the applicable
election, as applicable, (ii) the product of (A) the Conversion Amount of the Preferred Shares being redeemed or exchanged, as applicable,
multiplied by (B) the quotient determined by dividing (I) the greatest Closing Sale Price of the shares of Common Stock during the period
beginning on the date immediately preceding the earlier to occur of (1) the consummation of the applicable Change of Control and (2)
the public announcement of such Change of Control and ending on the date such Holder delivers the Change of Control Election Notice by
(II) the Alternate Conversion Price then in effect, and (iii) the product of (A) the Conversion Amount of the Preferred Shares being
redeemed multiplied by (B) the quotient of (I) the aggregate cash consideration and the aggregate cash value of any non-cash consideration
per share of Common Stock to be paid to such holders of the shares of Common Stock upon consummation of such Change of Control (any such
non-cash consideration constituting publicly-traded securities shall be valued at the highest of the Closing Sale Price of such securities
as of the Trading Day immediately prior to the consummation of such Change of Control, the Closing Sale Price of such securities on the
Trading Day immediately following the public announcement of such proposed Change of Control and the Closing Sale Price of such securities
on the Trading Day immediately prior to the public announcement of such proposed Change of Control) divided by (II) the Conversion Price
then in effect.
(r)
“Closing Bid Price” and “Closing Sale Price” means, for any security as of any date, the last closing
bid price and last closing trade price, respectively, 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 bid price or the closing trade price
(as the case may be) then the last bid price or last trade price, respectively, 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 closing bid price or last trade price, respectively, 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 do not apply, the last closing bid price or last trade
price, respectively, of such security in the over-the-counter market on the electronic bulletin board for such security as reported by
Bloomberg, or, if no closing bid price or last trade price, respectively, is reported for such security by Bloomberg, the average of
the bid prices, or the ask prices, respectively, 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 Bid Price or the Closing Sale Price cannot be
calculated for a security on a particular date on any of the foregoing bases, the Closing Bid Price or the Closing Sale Price (as the
case may be) of such security on such date shall be the fair market value as mutually determined by the Company and each of the Required
Holders. If the Company and each of the Required Holders 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 23. All such determinations shall be appropriately adjusted for any stock
splits, stock dividends, stock combinations, recapitalizations or other similar transactions during such period.
(s)
“Code” means the Internal Revenue Code of 1986, as amended.
(t)
“Common Stock” means (i) the Company’s shares of common stock, $0.001 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.
(u)
“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.
(v)
“Conversion Floor Price Condition” means that the relevant Alternate Conversion Price is being determined based on
clause (x) of such definitions.
(w)
“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.
(x)
“Eligible Market” means The New York Stock Exchange, the NYSE American, the Nasdaq Global Select Market, the Nasdaq
Global Market, the Nasdaq Capital Market.
(y)
“Exchange Agreement” means those certain exchange agreements set forth on Schedule I attached hereto.
(z)
“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 Initial 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 Holders; (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 Holders;
and (iii) the shares of Common Stock issuable upon conversion of the Preferred Shares or otherwise pursuant to the terms of this Certificate
of Designations; provided, that the terms of this Certificate of Designations 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).
(aa)
“FATCA” means Sections 1471 through 1474 of the Code, as of the date of this Preferred Shares (or any amended or successor
version that is substantively comparable and not materially more onerous to comply with), any current or future regulations or official
interpretations thereof, any agreements entered into pursuant to Section 1471(b)(1) of the Code and any fiscal or regulatory legislation,
rules or practices adopted pursuant to any intergovernmental agreement, treaty or convention among Governmental Authorities and implementing
such Sections of the Code.
(bb)
“Floor Price” means $0.519 (as adjusted for stock splits, stock dividends, stock combinations, recapitalizations and
similar events), or, subject to the rules and regulations of the Principal Market, such lower price as the Company and each of the Required
Holders may agree, from time to time.
(cc)
“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 Certificate of Designations 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) 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.
(dd)
“GAAP” means United States generally accepted accounting principles, consistently applied.
(ee)
“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.
(ff)
“Governmental Authority” 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.
(gg)
“Indebtedness” means 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 United States generally accepted accounting principles consistently applied for the periods covered thereby (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 United States generally accepted accounting
principles, 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 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
(H) all Contingent Obligations in respect of indebtedness or obligations of others of the kinds referred to in clauses (A) through (G)
above.
(hh)
“Intellectual Property Rights” means, with respect to the Company and its Subsidiaries, all of their 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.
(ii)
“Liquidation Event” means, whether in a single transaction or series of transactions, the voluntary or involuntary
liquidation, dissolution or winding up of the Company or such Subsidiaries the assets of which constitute all or substantially all of
the assets of the business of the Company and its Subsidiaries, taken as a whole.
(jj)
“Market Price” means, with respect to any Adjustment Date, 65% of the quotient determined by dividing (x) the sum
of the VWAP of the Common Stock for each of the three (3) lowest Trading Days during the twenty (20) consecutive Trading Day period ending
and including the Trading Day immediately such Applicable Date, divided by (y) three (3).
(kk)
“Material Adverse Effect” means any material adverse effect on the business, properties, assets, liabilities, operations,
results of operations, condition (financial or otherwise) or prospects of the Company and its Subsidiaries, if any, individually or taken
as a whole, or on the transactions contemplated hereby or on the other Transaction Documents (as defined below), or by the agreements
and instruments to be entered into in connection therewith or on the authority or ability of the Company to perform its obligations under
the Transaction Documents.
(ll)
“Merger Agreement” means that certain Agreement and Plan of Merger, dated December 11, 2023, by and among Aditxt,
Inc., Adicure, Inc. and Evofem Biosciences, Inc., as such shall be amended, supplemented and/or restated on or after the date hereof.
(mm)
“Options” means any rights, warrants or options to subscribe for or purchase shares of Common Stock or Convertible
Securities.
(nn)
“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.
(oo)
“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.
(pp)
“Principal Market” means, as of any time of determination, the principal trading market, if any, in which the shares
of Common Stock then trade.
(qq)
“Registration Rights Agreement” means that certain registration rights agreement, dated as of the Initial Issuance
Date, by and among the Company and the initial holders of the Preferred Shares relating to, among other things, the registration of the
resale of the Common Stock issuable upon conversion of the Preferred Shares or otherwise pursuant to the terms of this Certificate of
Designations, as may be amended from time to time.
(rr)
“Required Holders” means each of the Required Holders of the Securities Agreements provided if a Required Holder shall
hold less than 100 Preferred Shares, thereafter such Holder shall no longer be deemed a Required Holder.
(ss)
“Required Premium” means as applicable (i) 150% with respect to an Alternate Conversion pursuant to clause 5(a)(xvi)
above or (ii) otherwise, 125%.
(tt)
“SEC” means the United States Securities and Exchange Commission or the successor thereto.
(uu)
“Securities” means the Preferred Shares and the Conversion Shares.
(vv)
“Securities Agreements” means, collectively, (i) that certain securities purchase agreement by and among the Company
and certain holders of Preferred Shares, dated as of May 2, 2024, as may be amended from time in accordance with the terms thereof and
(ii) that certain Securities Exchange Agreement to be entered by and among the Company and certain holders of Preferred Shares, 2024,
as may be amended from time in accordance with the terms thereof.
(ww)
“Stated Value” shall mean $1,000 per share, subject to adjustment for stock splits, stock dividends, recapitalizations,
reorganizations, reclassifications, combinations, subdivisions or other similar events occurring after the Initial Issuance Date with
respect to the Preferred Shares.
(xx)
“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.
(yy)
“Subscription Date” means May 2, 2024.
(zz)
“Subject Entity” means any Person, Persons or Group or any Affiliate or associate of any such Person, Persons or Group.
(aaa)
“Subsequent Placement” means at any time on or prior to the fourth anniversary of the Initial Issuance Date, the Company
or any of its Subsidiaries shall, directly or indirectly, issue, offer, sell, grant any option or right to purchase, or otherwise dispose
of (or announce any issuance, offer, sale, grant of any option or right to purchase or other disposition of) any equity security or any
equity-linked or related security (including, without limitation, any “equity security” (as that term is defined under Rule
405 promulgated under the 1933 Act), any Convertible Securities, any debt, any preferred stock or any purchase rights).
(bbb)
“Subsidiary” shall have the meaning set forth in the Securities Agreements.
(ccc)
“Successor Entity” means the Person (or, if so elected by each of the Required Holders, the Parent Entity) formed
by, resulting from or surviving any Fundamental Transaction or the Person (or, if so elected by each of the Required Holders, the Parent
Entity) with which such Fundamental Transaction shall have been entered into.
(ddd)
“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 applicable
Holder or (y) with respect to all determinations other than price 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.
(eee)
“Transaction Documents” means the Securities Agreements, this Certificate of Designations, the Registration Rights
Agreement and each of the other agreements and instruments entered into or delivered by the Company or any of the Holders in connection
with the transactions contemplated by the applicable Securities Agreements, all as may be amended from time to time in accordance with
the terms thereof.
(fff)
“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 each of the Required Holders. If the Company and each of the Required Holders 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 23.
All such determinations shall be appropriately adjusted for any stock dividend, stock split, stock combination, recapitalization or other
similar transaction during such period.
33.
Disclosure. Upon receipt or delivery by the Company of any notice in accordance with the terms of this Certificate of Designations,
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 applicable Holder explicitly in writing in such notice (or immediately
upon receipt of notice from such 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 such Holder), such 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.
34.
Absence of Trading and Disclosure Restrictions. The Company acknowledges and agrees that no Holder is a fiduciary or agent of
the Company and that each 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 such 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 each 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.
[The
remainder of the page is intentionally left blank]
IN
WITNESS WHEREOF, the Company has caused this Certificate of Designations of the Certificate of Incorporation of Aditxt, Inc. to be signed
by its Chief Executive Officer on this 2nd day of May, 2024.
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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
I
ADITXT,
INC.
CONVERSION
NOTICE
Reference
is made to the Certificate of Designations of the Certificate of Incorporation of Aditxt, Inc., a Delaware corporation (the “Company”)
establishing the terms, preferences and rights of the Series C-1 Convertible Preferred Stock, $0.001 par value (the “Preferred
Shares”) of the Company (the “Certificate of Designations”). In accordance with and pursuant to the Certificate
of Designations, the undersigned hereby elects to convert the number of Preferred Shares indicated below into shares of common stock,
$0.001 value per share (the “Common Stock”), of the Company, as of the date specified below.
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Date of Conversion: |
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Aggregate number of Preferred Shares to be converted: |
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Aggregate Stated Value of such Preferred
Shares to be converted: |
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Aggregate accrued and unpaid
Dividends with respect to such Preferred
Shares to be converted: |
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AGGREGATE CONVERSION AMOUNT TO BE CONVERTED: |
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| Please confirm the following information: |
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Conversion Price: |
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Number of shares of Common
Stock to be issued: |
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| ☐ | If
this Conversion Notice is being delivered with respect to an Alternate Conversion, check
here if Holder is electing to use the following Alternate Conversion Price: ____________ |
Please
issue the Common Stock into which the applicable Preferred Shares are being converted 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: |
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DTC Participant: |
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DTC Number: |
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Account Number: |
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Date: _____________
__, __
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| Name of Registered Holder |
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| By: |
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Name: |
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Title: |
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Tax ID:_____________________ |
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E-mail Address: |
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EXHIBIT
II
ACKNOWLEDGMENT
The
Company hereby (a) acknowledges this Conversion Notice, (b) certifies that the above indicated number of shares of Common Stock are eligible
to be resold by the applicable Holder without restriction and hereby directs _________________ to issue the above indicated number of
shares of Common Stock in accordance with the Transfer Agent Instructions dated _____________, 20__ from the Company and acknowledged
and agreed to by ________________________.
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ADITXT, INC. |
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By: |
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Name: |
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Title: |
APPENDIX
C
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: [*], 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, [BUYER], 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.
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 Registration Rights Agreement, after the effective date of the Registration Statement (as defined in the Registration
Rights Agreement) and prior to the Holder’s receipt of the notice of a Grace Period (as defined in the Registration Rights Agreement),
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 Registrable Securities (as defined in the Registration Rights Agreement) 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 $[*], 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 Registration Rights 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 (as defined in the Registration Rights Agreement) 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 Exchange Agreement by and between the Holder and the Company dated August 7,
2024 (the “Exchange 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 the Initial Reserve Amount (as defined in the Exchange 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.
21.
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 Omitted].
(e)
Other Events. In the event that the Company (or any Subsidiary (as defined in the Exchange 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 2(e) 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 Exchange 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 Exchange
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 Exchange Agreement), no adjustment pursuant to
this Section 2 shall cause the Exercise Price to be less than $[*] (as adjusted for any stock dividend, stock split, stock combination,
reclassification or similar transaction occurring after the date of the Exchange 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.
22. 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).
23.
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 Exchange 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)).
24.
NONCIRCUMVENTION. The Company hereby covenants and agrees that the Company will not, by amendment
of its Certificate of Incorporation (as defined in the Exchange Agreement), Bylaws (as defined in the Exchange 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.
25.
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.
26.
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.
27.
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 Exchange 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 Exchange 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.
28.
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.
29.
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.
30.
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.
31.
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).
32.
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 Exchange 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.
33.
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 Exchange Agreement) in such other Transaction
Documents unless otherwise consented to in writing by the Holder.
34.
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).
35.
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.
36.
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.
37.
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 the Exchange Purchase Agreement.
38.
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)
“Registration Rights Agreement” means that certain registration rights agreement, dated as of the Closing Date, by
and among the Company and the Buyers 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, as may be amended from time to time.
(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. |
| |
|
|
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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 |
|
| Tax ID:_____________________ |
|
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|
| 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 |
APPENDIX
D
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”).
20.
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.
21.
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 Omitted].
(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.
22. 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).
23.
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)).
24.
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.
25.
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.
26.
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.
27.
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.
28. 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.
29.
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.
30.
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.
31.
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).
32.
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.
33.
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.
34.
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).
35.
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.
36.
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.
37.
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.
38.
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. |
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By: |
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Name: |
Amro Albanna |
| |
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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: |
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DTC Participant: |
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DTC Number: |
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Account Number: |
|
Date: _____________
__, __
| |
|
| Name of Registered Holder |
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| By: |
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Name: |
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Title: |
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Tax ID: ___________________________ |
|
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Facsimile: _________________________ |
|
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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 |
D-25
Aditxt (NASDAQ:ADTX)
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