UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934
Date of Report (Date of earliest event reported):
December 26, 2024
| Nxu, Inc. |
| (Exact Name of Registrant as Specified in Charter) |
|
|
001-41509 |
|
92-2819012 |
|
(State or Other Jurisdiction
of Incorporation |
|
(Commission File Number) |
|
(IRS Employer
Identification No.) |
| 1828 N. Higley Rd. Ste 116, Mesa, AZ 85205 |
| (Address of Principal Executive Offices) (Zip Code) |
Registrant’s telephone number, including
area code: (602) 309-5425
Check the appropriate box below if the Form 8-K filing is intended
to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction
A.2. below):
| ☐ | Written
communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
| ☒ | Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| ☐ | Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| ☐ | Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Securities registered pursuant to Section 12(b) of the Act:
| Title of each Class |
|
Trading
Symbol(s) |
|
Name
of each exchange on which registered |
| Class A Common Stock, par value $0.0001 per share |
|
NXU |
|
NASDAQ |
Indicate by check mark whether the registrant
is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the
Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth
company ☒
If
an emerging growth company, indicate by check mark if the Registrant has elected not to use the extended transition period for complying
with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.
Item 1.01 Entry into a Material Definitive Agreement.
PIPE Securities Purchase Agreement
On December 26, 2024, Nxu, Inc. (the “Company”)
entered into, and consummated the transactions contemplated by, a Securities Purchase Agreement (the “Purchase Agreement”)
with the purchasers named therein (the “Investors”). Pursuant to the Purchase Agreement, the Company will sell to the Investors
(the “Private Placement”) an aggregate of (i) 6,800,000 shares (the “Purchased Shares”) of the Company’s
Class A Common Stock, $0.0001 par value per share (“Common Stock”), (ii) pre-funded warrants to purchase 5,200,000 shares
of Common Stock (the “Pre-Funded Warrants”), (iii) Series A warrants to purchase up to 6,000,000 shares of Common Stock (the
“Series A Warrants”), and (iv) Series B warrants to purchase a number of shares of Common Stock to be determined on the Reset
Date referenced below in accordance with the terms of the Series B warrants (the “Series B Warrants” and together with the
Pre-Funded Warrants and the Series A Warrants, the “Warrants”). The Purchased Shares, the Warrants and the shares of Common
Stock issuable upon exercise of the Warrants are collectively referred to herein as the “Securities.” The aggregate offering
price for the Purchased Shares and the Warrants sold in the Private Placement was approximately $3,000,000.
The Pre-Funded Warrants
are exercisable immediately following the date of issuance, may be exercised at any time until all of the Pre-Funded Warrants are exercised
in full, and have an initial exercise price of $0.0001 per share, subject to adjustment. The Series A Warrants and the Series B Warrants
are exercisable upon receipt of approval of the Company’s stockholders relating to the issuance of the shares of Common Stock underlying
the Series A Warrants and the Series B warrants as required by the rules and regulations of The Nasdaq Stock Market LLC (the “Stockholder
Consent”). The Series A Warrants have an exercise price of $0.50, subject to adjustment. In addition, with respect to the Series
A Warrants, the Investors may also effect an “alternative cashless exercise” after the Stockholder Consent has been obtained
but prior to the time of the closing of the merger (the “Automatic Exercise Time”) contemplated by the Agreement and Plan
of Merger, dated as of October 23, 2024, by and among the Company, NXU Merger Sub, Inc., a Delaware corporation, NXU Merger Sub, LLC,
a Delaware limited liability company, and Verde Bioresins, Inc., a Delaware corporation (the “Merger Agreement”). In such
event, the aggregate number of shares of Common Stock issuable in such alternative cashless exercise of the Series A Warrants will equal
the product of (i) the aggregate number of shares of Common Stock that would be issuable upon exercise of such Series A Warrant
in accordance with the terms of such Series A Warrant if such exercise were by means of a cash exercise rather than a cashless exercise,
multiplied by (ii) 1.0. The Series A Warrants contain a reset adjustment that is expected to occur on the date (the “Reset
Date”) that is the eighth trading day after the effectiveness of the Registration Statement (as defined below) or, if later, the
eighth trading day after the Stockholder Consent is obtained. The reset price means the greater of (i) 80% of the lowest daily weighted
average price (as defined) and (ii) a floor price of $0.0524 (subject to adjustment). If the exercise price of the Series A Warrants is
reduced pursuant to the reset provisions, the number of shares of Common Stock for which the Series A Warrants can be exercised will be
correspondingly increased. The number of shares of Common Stock for which the Series B Warrants can initially be exercised will be determined
on the Reset Date and will equal that number obtained by subtracting (i) the number of Purchased Shares purchased by the Investors on
the closing date of the Private Placement pursuant to the Purchase Agreement from (ii) the quotient obtained by dividing (x) the aggregate
purchase price paid the Investors on the closing date for the Private Placement by (y) the applicable reset price determined on the Reset
Date. The Series B Warrants have an exercise price of $0.0001 per share, subject to adjustment. As a result of the reset provisions in
the Series A Warrants and the provisions for determining the number of shares of Common Stock into which the Series B Warrants may be
exercised, the number of shares into which the Warrants will be exercisable following the Reset Date may be significantly greater than
the number of shares into which the Warrants are exercisable on the closing date of the Private Placement.
A holder may not exercise
any Pre-Funded Warrants or Series A Warrants that would cause the aggregate number of shares of Common Stock beneficially owned by the
holder to exceed 4.99% (or 9.99% at the election of the holder) of the Company’s outstanding Common Stock immediately after exercise.
A holder may not exercise any Series B Warrant that would cause the aggregate number of shares of Common Stock beneficially owned by the
holder to exceed 4.99% of the Company’s outstanding Common Stock immediately after exercise (the “Beneficial Ownership Limitation”).
The Warrants are subject to adjustment in the event of certain stock dividends and distributions, stock splits, stock combinations, reclassifications
or similar events affecting the Common Stock and also upon any distributions for no consideration of assets to the Company’s stockholders.
The Warrants do not entitle the holders thereof to any voting rights or any of the other rights or privileges to which holders of Common
Stock are entitled.
In the event of a “Fundamental
Transaction,” which term is defined in the respective Warrants and generally includes (i) the Company, directly or indirectly, in
one or more related transactions effecting any merger or consolidation of the Company with or into another Subject Entity (as defined
in the respective Warrants) whether or not the Company is the surviving entity, (ii) the Company, directly or indirectly, effecting any
sale, assignment, transfer, conveyance or other disposition of all or substantially all of the Company’s (or any of its “significant
subsidiaries”) assets in one or a series of related transactions, (iii) any, direct or indirect, purchase offer, tender offer or
exchange offer (whether by the Company or another Subject Entity) completed pursuant to which holders of Common Stock are permitted to
sell, tender or exchange their shares for other securities, cash or property and has been accepted by the holders of at least 50% of the
outstanding shares of Common Stock, (iv) the Company, directly or indirectly, in one or more related transactions consummating a stock
purchase agreement or other business combination (including, without limitation, a reorganization, recapitalization, spin-off, merger
or scheme of arrangement) with one or more Subject Entities whereby all such Subject Entities, individually or in the aggregate, acquires
at least 50% of the outstanding shares of Common Stock, or (v) the Company, directly or indirectly, in one or more related transactions
with one or more Subject Entities effecting any reclassification, reorganization or recapitalization of the Common Stock or any compulsory
share exchange pursuant to which all such Subject Entities, individually or in the aggregate, acquire at least 50% of the outstanding
shares of Common Stock, the holders of the Warrants will be entitled to receive upon exercise of such Warrants the kind and amount of
securities, cash or other property that the holders would have received had they exercised such Warrants immediately prior to such Fundamental
Transaction. Notwithstanding, the term “Fundamental Transaction” does not include the Company’s pending merger with
Verde Bioresins, Inc. pursuant to the Merger Agreement.
Any portion of the Series
A Warrants and Series B Warrants that is not exercised as of the Automatic Exercise Time will be automatically exercised as of such Automatic
Exercise Time (concurrently with the closing of the merger contemplated by the Merger Agreement) pursuant to a cashless exercise, subject
to (i) Stockholder Consent is received and effective through such exercise time and (ii) the Beneficial Ownership Limitation. Any portion
of the Pre-Funded Warrants that is not exercised as of the Automatic Exercise Time will be automatically exercised as of such Automatic
Exercise Time pursuant to a cashless exercise, subject to the Beneficial Ownership Limitation.
Pursuant to an engagement letter between the Company
and Maxim Group LLC (the “Placement Agent”), the Company will pay the Placement Agent a cash fee at closing equal to 7.0%
of the gross proceeds received by the Company in the offering, and will reimburse the Placement Agent for up to $50,000 for accountable
out-of-pocket expenses.
The foregoing descriptions of the Purchase Agreement
and the Warrants do not purport to be complete and are qualified in their entirety by references to the full text of (i) the form of the
Purchase Agreement, which is filed as Exhibit 10.1 to this Current Report on Form 8-K (this “Report”) and is incorporated
herein; (ii) the form of Pre-Funded Warrant, which is filed as Exhibit 4.1 to this Report and is incorporated by reference herein; (iii)
the form of Series A Warrant, which is filed as Exhibit 4.2 to this Report and is incorporated by reference herein; and (iv) the form
of Series B Warrant, which is filed as Exhibit 4.3 to this Report and is incorporated by reference herein.
Registration Rights Agreement
In connection with the Private Placement, the
Company also entered into a Registration Rights Agreement, dated December 26, 2024 (the “Registration Rights Agreement”),
with the Investors requiring the Company to register the resale of the Purchased Shares and the shares of Common Stock issuable upon exercise
of the Warrants under a registration statement on Form S-3 (or a Form S-1 if the Company is not then eligible to register for resale such
securities on Form S-3) (the “Resale Registration Statement”). The Company is required to prepare and file the Resale Registration
Statement with the Securities and Exchange Commission (the “SEC”) as soon as reasonably practicable, but in no event later
than 30 days following the closing date of the Private Placement (the “Filing Deadline”), and to use reasonable best efforts
to cause the Resale Registration Statement to be declared effective as promptly as practicable thereafter, and in any event no later than
50 days following the closing date of the Private Placement if the Resale Registration Statement is not subject to a “full review”
by the SEC and 70 days following the closing date of the Private Placement in the event of a full review of the Resale Registration Statement
by the SEC (the “Effectiveness Deadline”).
If the Company fails to meet the Filing Deadline
or the Effectiveness Deadline, subject to certain terms provided for in the Registration Rights Agreement, the Company will be required
to pay liquidated damages to the Investors. The Registration Rights Agreement provides for customary indemnification and contribution
provisions. In the event the Investors no longer hold “Registrable Securities,” as defined in the Registration Rights Agreement,
or when the Registrable Securities may be resold by the Investors pursuant to Rule 144 (“Rule 144”) promulgated under the
Securities Act of 1933, as amended (the “Securities Act”), the Company may not be obligated to cause the declaration of effectiveness
of the Resale Registration Statement by the SEC.
The foregoing description of the Registration
Rights Agreement does not purport to be complete and is qualified in its entirety by reference to the full text of the form of the Registration
Rights Agreement, which is filed as Exhibit 10.2 to this Report and is incorporated by reference herein.
Lock-Up Agreement
In addition, pursuant to certain “lock-up”
agreements (each, a “Lock-Up Agreement”) that were required to be entered into as a condition to the closing of the Private
Placement, the Company’s executive officers and directors have agreed, for a period of 30 days from the earlier of (x) such time
as one or more Resale Registration Statement(s) covering the resale of all Registrable Securities has been effective and available for
the re-sale of all such Registrable Securities, and (y) such time as all of the Registrable Securities may be sold without restriction
or limitation pursuant to Rule 144, not to engage in any of the following, whether directly or indirectly, without the consent of the
Investors under the Purchase Agreement: offer, sell, contract to sell, hypothecate, pledge or otherwise dispose of any shares of Common
Stock or securities convertible, exchangeable or exercisable into, shares of Common Stock beneficially owned, held or acquired by the
Investors.
The foregoing description of the Lock-Up Agreements
does not purport to be complete and is qualified in its entirety by reference to the full text of the form of Lock-Up Agreement, which
is filed as Exhibit 10.3 to this Report and is incorporated by reference herein.
Voting Agreement
In addition, each of Mark Hanchett, Annie Pratt,
Britt Ide, Jessica Billingsley and Sarah Wyant agreed to enter into voting agreements (each, a “Voting Agreement”) to vote
all shares of the Company voting stock over which each such individual has voting control in favor of any resolution presented to the
shareholders of the Company to approve the terms and exercise of the Series A warrant and Series B warrant to comply with the applicable
rules and regulations of the Nasdaq Stock Market.
The foregoing description of the Voting Agreements
does not purport to be complete and is qualified in its entirety by reference to the full text of the form of Voting Agreement, which
is filed as Exhibit 10.4 to this Report and is incorporated by reference herein.
Item 3.02 Unregistered Sales of Equity Securities.
The information contained above in Item 1.01 of
this Report is hereby incorporated by reference into this Item 3.02 in its entirety.
Based in part upon the representations of the
Investors in the Purchase Agreement, the issuances of the Securities in connection with the Private Placement are exempt from registration
under the Securities Act pursuant to the exemption for transactions by an issuer not involving any public offering under Section 4(a)(2)
of the Securities Act and Rule 506 of Regulation D promulgated thereunder. Each of the Investors represented that they are an “accredited
investor” as defined in Rule 501(a) under the Securities Act, and that they are acquiring the Securities for investment purposes
only and not with a view to any resale, distribution or other disposition of the Securities in violation of the United States federal
securities laws.
Cautionary Statement Regarding Forward-Looking
Statements
This Report contains
“forward-looking” statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities
Exchange Act of 1934, as amended, including statements related to any anticipated stockholder approvals required in connection with the
Private Placement, the filing of the Resale Registration Statement to register the resale of the Shares and the shares of Common Stock
issuable upon exercise of the Warrants, the potential future sale of shares of the Company’s Common Stock and price for such sales
under the Purchase Agreement. The words “may,” “will,” “could,” “would,” “should,”
“expect,” “future,” “intend,” “plan,” “believe,” “potential,”
“continue” and similar expressions are intended to identify forward-looking statements, although not all forward-looking statements
contain these identifying words. While the Company believes its plans, intentions and expectations reflected in those forward-looking
statements are reasonable, these plans, intentions or expectations may not be achieved. The Company’s actual results, performance
or achievements could differ materially from those contemplated, expressed or implied by the forward-looking statements. For information
about the factors that could cause such differences, please refer to the risk factors set forth under “Risk Factors” in Part
I, Item 1A of the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2023, set forth in the Company’s
subsequent Quarterly Reports on Form 10-Q, set forth under “RISK FACTORS” in the Company’s Registration Statement on
Form S-4 filed as of November 12, 2024, or set forth in the Company’s other filings with the SEC. Additional risks and uncertainties
include, but are not limited to, whether the Company will be successful in obtaining the required stockholder approvals in connection
with the Private Placement and the Company’s ability to file the Resale Registration Statement with the SEC and cause its effectiveness
in a timely manner in accordance with the Resale Registration Statement or at all. Given these uncertainties, you should not place undue
reliance on these forward-looking statements. The Company assumes no obligation to update any forward-looking statement.
Important Additional Information About the
Transaction and Where to Find It
This Report and the exhibits filed or furnished
herewith are not substitutes for the Registration Statements (as defined below) or for any other document that the Company may file with
the SEC in connection with the Private Placement and the merger contemplated by the Merger Agreement. In connection with the Private Placement
and the merger contemplated by the Merger Agreement, the Company intends to file the Resale Registration Statement and a registration
statement on Form S-4/A (together with the Resale Registration Statement, the “Registration Statements”) with the SEC, which
includes a document that serves as a prospectus and proxy statement of the Company, referred to as a “Proxy Statement/Prospectus.”
The preliminary and definitive proxy statements/prospectuses and other relevant documents will be sent or given to the stockholders of
the Company as of the record date established for voting on proposals relating to the Private Placement, the merger contemplated by the
Merger Agreement and other matters. THE COMPANY URGES ITS INVESTORS AND STOCKHOLDERS TO READ THE REGISTRATION STATEMENTS, PRELIMINARY
PROXY STATEMENT/PROSPECTUS, DEFINITIVE PROXY STATEMENT/PROSPECTUS (ONCE AVAILABLE) AND ANY OTHER RELEVANT DOCUMENTS THAT MAY BE FILED
WITH THE SEC, AS WELL AS ANY AMENDMENTS OR SUPPLEMENTS TO THESE DOCUMENTS, CAREFULLY AND IN THEIR ENTIRETY IF AND WHEN THEY BECOME AVAILABLE
BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT THE COMPANY, THE PRIVATE PLACEMENT, THE MERGER CONTEMPLATED BY THE MERGER AGREEMENT
AND RELATED MATTERS. Investors and stockholders will be able to obtain free copies of the Registration Statements, the preliminary Proxy
Statement/Prospectus, the definitive Proxy Statement/Prospectus (once available), and other documents filed by the Company with the SEC
(when they become available) through the website maintained by the SEC at www.sec.gov. In addition, investors and stockholders should
note that the Company communicates with investors and the public using its website (www.nxuenergy.com) and the investor relations website
(investors.nxuenergy.com), where anyone will be able to obtain free copies of the Registration Statements, preliminary Proxy Statement/Prospectus,
definitive Proxy Statement/Prospectus (once available) and other documents filed by the Company with the SEC and investors and stockholders
are urged to read the Registration Statements, preliminary Proxy Statement/Prospectus, definitive Proxy Statement/Prospectus (once available)
and the other relevant materials when they become available before making any voting or investment decision with respect to the Private
Placement and the merger contemplated by the Merger Agreement.
No Offer or Solicitation
This Report and the exhibits filed or furnished
herewith are not intended to and do not constitute (i) a solicitation of a proxy, consent or approval with respect to any securities or
in respect of the Private Placement or the merger contemplated by the Merger Agreement or (ii) an offer to sell or the solicitation of
an offer to subscribe for or buy or an invitation to purchase or subscribe for any securities pursuant to the Private Placement, the merger
contemplated by the Merger Agreement or otherwise, nor shall there be any sale, issuance or transfer of securities in any jurisdiction
in contravention of applicable law. No offer of securities shall be made except by means of a prospectus meeting the requirements of the
Securities Act or an exemption therefrom. Subject to certain exceptions to be approved by the relevant regulators or certain facts to
be ascertained, the public offer will not be made directly or indirectly, in or into any jurisdiction where to do so would constitute
a violation of the laws of such jurisdiction, or by use of the mails or by any means or instrumentality (including without limitation,
facsimile transmission, telephone and the internet) of interstate or foreign commerce, or any facility of a national securities exchange,
of any such jurisdiction.
NEITHER THE SEC NOR ANY STATE SECURITIES COMMISSION
HAS APPROVED OR DISAPPROVED OF THE SECURITIES OR DETERMINED IF THIS REPORT AND THE EXHIBITS FILED OR FURNISHED HEREWITH ARE TRUTHFUL OR
COMPLETE.
Participants in the Solicitation
The Company and its respective directors, executive
officers and other members of management may be considered participants in the solicitation of proxies in connection with the Private
Placement and the merger contemplated by the Merger Agreement. Information about the Company’s directors and executive officers,
consisting of Mark Hanchett, Annie Pratt, Britt Ide, Jessica Billingsley and Sarah Wyant, including a description of their direct or indirect
interest, by security holdings or otherwise, can be found under the captions, “Security Ownership of Certain Beneficial Owners and
Management,” “Executive Compensation,” and “Director Compensation” contained in the definitive proxy statement
on Schedule 14A for the Company’s 2024 annual meeting of stockholders, filed with the SEC on May 2, 2024 (the “2024 Nxu Proxy
Statement”). To the extent that the Company’s directors and executive officers and their respective affiliates have acquired
or disposed of security holdings since the applicable “as of” date disclosed in the 2024 Nxu Proxy Statement, such transactions
have been or will be reflected on Statements of Change in Beneficial Ownership on Form 4 filed with the SEC. These documents can be obtained
free of charge from the sources indicated above.
Item 9.01 Financial Statements and Exhibits.
(d)
Exhibits.
| * | Schedules and attachments have been omitted pursuant to Item
601(a)(5) of Regulation S-K. The Company agrees to furnish supplementally a copy of any omitted exhibit to the SEC upon request. |
SIGNATURES
Pursuant to the requirements
of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned
hereunto duly authorized.
| |
NXU, INC. |
| |
|
| Date: December 27, 2024 |
By: |
/s/ Mark Hanchett |
| |
|
Mark Hanchett |
| |
|
Chief Executive Officer |
6
Exhibit 4.1
FORM OF PRE-FUNDED WARRANT
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 SELECTED BY THE HOLDER, IN A GENERALLY ACCEPTABLE FORM, THAT REGISTRATION IS NOT REQUIRED UNDER SAID ACT OR (II)
UNLESS 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.
NXU, INC.
Pre-Funded
Warrant To Purchase Common Stock
Warrant No.: _________
Number of Warrant Shares: _____________
Date of Issuance: December 30, 2024 (“Issuance Date”)
Nxu, Inc., a Delaware corporation
(the “Company”), hereby certifies that, for good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, [HOLDER], 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, at any time or times on or after the date hereof until the
earlier of the date on which this Warrant is exercised in full and the Automatic Exercise Date (as defined below), ______________ (_____________)
fully paid nonassessable shares of Common Stock, subject to adjustment as provided herein (the “Warrant Shares”). Except
as otherwise defined herein, capitalized terms in this Warrant to Purchase shares of Common Stock (including any Warrants to Purchase
shares of Common Stock issued in exchange, transfer or replacement hereof, this “Warrant”), shall have the meanings
set forth in Section 17. This Warrant is one of the Series A Warrants to purchase shares of Common Stock (the “SPA Warrants”)
issued pursuant to Section 1 of that certain Securities Purchase Agreement, dated as of December 26, 2024 (the “Subscription
Date”), by and among the Company and the investors (the “Buyers”) referred to therein (the “Securities
Purchase Agreement”). Capitalized terms used herein and not otherwise defined shall have the definitions ascribed to such terms
in the Securities Purchase Agreement.
1. EXERCISE OF WARRANT.
(a) Mechanics of Exercise.
Subject to the terms and conditions hereof (including, without limitation, the limitations set forth in Section 1(f)), this Warrant may
be exercised by the Holder at any time or times on or after the Issuance Date, in whole or in part, through 5:00 P.M. New York City time
on the Automatic Exercise Date (such time on the Automatic Exercise Date, the “Automatic Exercise Time”), if applicable,
by (i) delivery (whether via email 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 and (ii) (A) payment to the Company of an amount equal to
the applicable Exercise Price in effect on the date of such exercise multiplied by the number of Warrant Shares as to which this Warrant
is being exercised (the “Aggregate Exercise Price”) in cash by wire transfer of immediately available funds or (B)
if the provisions of Section 1(d) are applicable, by notifying the Company in the Exercise Notice that this Warrant is being exercised
pursuant to a Cashless Exercise (as defined in Section 1(d)). Any portion of this Warrant that has not previously been exercised as of
the Automatic Exercise Time shall be automatically exercised as of such Automatic Exercise Time pursuant to a Cashless Exercise, subject
to the limitations set forth in Section 1(f). The Holder shall not be required to deliver the original Warrant in order to effect an exercise
hereunder. Execution and delivery of the Exercise Notice with respect to less than all of the Warrant Shares shall have the same effect
as cancellation of the original Warrant and issuance of a new Warrant evidencing the right to purchase the remaining number of Warrant
Shares. On or before the first (1st) Trading Day following the date on which the Company has received the Exercise Notice,
the Company shall transmit by electronic mail an acknowledgment of confirmation of receipt of the Exercise Notice to the Holder and the
Company’s transfer agent (the “Transfer Agent”). On or before the earlier of (i) the first (1st) Trading
Day and (ii) the number of Trading Days comprising the Standard Settlement Period, in each case, following the date on which the Holder
delivers the Exercise Notice to the Company, so long as the Holder delivers the Aggregate Exercise Price (or notice of a Cashless Exercise)
on or prior to the Trading Day following the date on which the Company has received the Exercise Notice (the “Share Delivery
Date”) (provided that if the Aggregate Exercise Price has not been delivered by such date and the Holder has indicated in the
Exercise Notice that the Holder is exercising the Warrant for cash, the Share Delivery Date shall be one (1) Trading Day after the Aggregate
Exercise Price (or notice of a Cashless Exercise) is delivered), the Company shall (X) provided that the Transfer Agent is participating
in The Depository Trust Company (“DTC”) Fast Automated Securities Transfer Program and (A) the Warrant Shares are subject
to an effective resale registration statement in favor of the Holder or (B) if exercised via Cashless Exercise, at a time when Rule 144
would be available for resale of the Warrant Shares by the Holder, credit 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, or (Y) if the Transfer Agent is not participating in the DTC Fast Automated Securities Transfer Program or (A) the
Warrant Shares are not subject to an effective resale registration statement in favor of the Holder or (B) if exercised via Cashless Exercise,
at a time when Rule 144 would not be available for resale of the Warrant Shares by the Holder, deliver to the Holder, book entry statements
evidencing the Warrant Shares, for the number of Warrant Shares to which the Holder is entitled pursuant to such exercise. The Company
shall be responsible for all fees and expenses of the Transfer Agent and all fees and expenses with respect to the issuance of Warrant
Shares via DTC, if any. Upon delivery of the 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 book entry statements 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,
then the Company shall as soon as practicable and in no event later than three (3) Trading Days after any exercise and at its own expense,
issue a new Warrant (in accordance with Section 7(d)) representing the right to purchase the number of Warrant Shares issuable immediately
prior to such exercise under this Warrant, less the number of Warrant Shares with respect to which this Warrant is exercised. No fractional
Warrant Shares or scrip representing fractional shares are to be issued upon the exercise of this Warrant. As to any fraction of a share
to which the Holder would otherwise be entitled to purchase upon exercise, the Company shall, at its election, either pay a cash adjustment
in respect of such final fraction in an amount equal to such fraction multiplied by the Exercise Price or round up to the nearest whole
share. The Company shall pay any and all taxes which may be payable with respect to the issuance and delivery of Warrant Shares upon exercise
of this Warrant. The Company’s obligations to issue and deliver Warrant Shares in accordance with the terms and subject to the conditions
hereof are absolute and unconditional, irrespective of any action or inaction by the Holder to enforce the same, any waiver or consent
with respect to any provision hereof, the recovery of any judgment against any Person or any action to enforce the same, or any setoff,
counterclaim, recoupment, limitation or termination. Notwithstanding the foregoing, with respect to any Exercise Notice delivered on or
prior to 12:00 p.m. (New York City time) on the Trading Day prior to the Issuance Date, which may be delivered at any time after the time
of execution of the Securities Purchase Agreement, the Company agrees to deliver the Warrant Shares subject to such notice(s) by 4:00
p.m. (New York City time) on the Issuance Date and the Issuance Date shall be the Share Delivery Date for purposes hereunder, provided
that payment of the aggregate Exercise Price (other than in the case of a cashless exercise) is received by such Share Delivery Date.
(b) Exercise Price.
The aggregate exercise price of this Warrant, except for a nominal exercise price of $0.0001 per Warrant Share, was pre-funded to the
Company on or prior to the Issuance Date and, consequently, no additional consideration (other than the nominal exercise price of $0.0001
per Warrant Share) shall be required to be paid by the Holder to any Person to effect any exercise of this Warrant. The Holder shall not
be entitled to the return or refund of all, or any portion, of such pre-paid aggregate exercise price under any circumstance or for any
reason whatsoever, including in the event this Warrant shall not have been exercised. The remaining unpaid exercise price per share of
Common Stock under this Warrant shall be $0.0001, subject to adjustment hereunder (the “Exercise Price”).
(c) Company’s Failure
to Timely Deliver Securities. Unless such failure is not caused by the Company, if the Company fails for any reason to deliver to
the Holder the Warrant Shares subject to a Notice of Exercise by the Share Delivery Date, the Company shall pay to the Holder, in cash,
as liquidated damages and not as a penalty, for each $1,000 of Warrant Shares subject to such exercise (based on the Weighted Average
Price of the Common Stock on the date of the applicable Notice of Exercise), $10 per Trading Day (increasing to $20 per Trading Day on
the third Trading Day after the Share Delivery Date) for each Trading Day after such Share Delivery Date until such Warrant Shares are
delivered or Holder rescinds such exercise. Additionally, if the Company shall fail (and such failure is not caused by any third party
action or failure to act) to cause the Transfer Agent to transmit to the Holder on or prior to the Share Delivery Date, Warrant Shares
pursuant to an exercise notice delivered by the Holder and if after such date the Holder is required by its broker to purchase (in an
open market transaction or otherwise) or the Holder’s brokerage firm otherwise purchases, shares of Common Stock to deliver in satisfaction
of a sale by the Holder of the Warrant Shares which the Holder anticipated receiving upon such exercise (a “Buy-In”),
then the Company shall, within one (1) Trading Day after the Holder’s request, (a) pay in cash to the Holder the amount, if any,
by which (x) the Holder’s total purchase price (including brokerage commissions, if any) for the shares of Common Stock so purchased
exceeds (y) the amount obtained by multiplying (1) the number of Warrant Shares that the Company was required to deliver to the Holder
in connection with the exercise at issue times (2) the price at which the sell order giving rise to such purchase obligation was executed,
and (b) at the option of the Holder, either reinstate the portion of the Warrant and equivalent number of Warrant Shares for which such
exercise was not honored (in which case such exercise shall be deemed rescinded) or deliver to the Holder the number of shares of Common
Stock that would have been issued had the Company timely complied with its exercise and delivery obligations hereunder. For example, if
the Holder purchases shares of Common Stock having a total purchase price of $11,000 to cover a Buy-In with respect to an attempted exercise
of Common Stock with an aggregate sale price giving rise to such purchase obligation of $10,000, under clause (a) of the immediately preceding
sentence the Company shall be required to pay the Holder $1,000. The Holder shall provide the Company written notice indicating the amounts
payable to the Holder in respect of the Buy-In and evidence of the amount of such loss. 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 shares of Common Stock upon the exercise
of this Warrant as required pursuant to the terms hereof.
(d) Cashless Exercise.
Notwithstanding anything contained herein to the contrary, 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 Common Stock 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 if such exercise were by means of a cash exercise rather than a Cashless Exercise. |
| B = |
as applicable: (i) the Weighted Average Price of the 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) of Regulation NMS promulgated under the federal securities laws) on such Trading Day, (ii) at the option of the Holder, either (y) the Weighted Average Price on the Trading Day immediately preceding the date of the applicable Exercise Notice or (z) the bid price of the Common Stock on the principal Trading Market as reported by Bloomberg 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 (including until two (2) hours after the close of “regular trading hours” on a Trading Day) pursuant to Section 1(a) hereof or (iii) the Weighted Average 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 pursuant to this
Section 1(d), the Company hereby acknowledges and agrees that, in accordance with Section 3(a)(9) of the 1933 Act, 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. The Company
agrees not to take any position contrary to this Section 1(d).
(e) Disputes. In the
case of a dispute as to the determination of the Exercise Price or the arithmetic calculation of the Warrant Shares, 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 12.
(f) Beneficial Ownership
Limitations on Exercises. Notwithstanding anything to the contrary contained herein, 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 number of 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 the number of 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) and Series A Warrants or Series B Warrants (as defined in the Securities Purchase Agreement) 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). For purposes of this Section 1(f), beneficial ownership shall be calculated in accordance with Section 13(d) of
the Securities Exchange Act of 1934, as amended (the “1934 Act”). For purposes of this Warrant, in 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 Securities and Exchange Commission
(the “SEC”), as the case may be, (y) a more recent public announcement by the Company or (3) any other written notice
by the Company or the Transfer Agent 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), to exceed the Maximum Percentage, the Holder must notify the Company of a reduced
number of Warrant Shares to be purchased 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 request of the Holder, the Company shall
within one (1) Trading Day confirm 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 the Holder hereby surrenders such Excess Shares to the Company for
no consideration, and the Holder shall not have the power to vote or to transfer 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-1(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) 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)
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) Insufficient Authorized
Shares. If at any time while this Warrant remains 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 exercise of this Warrant at least a number of shares of
Common Stock equal to 100% of the number of shares of Common Stock as shall from time to time be necessary to effect the exercise of all
of this Warrant then outstanding without regard to any limitation on exercise included herein (the “Required Reserve Amount”
and the failure to have such sufficient number of authorized and unreserved shares of Common Stock, 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 this Warrant then outstanding. Without limiting the generality
of the foregoing sentence, if shareholder approval is required to cure an Authorized Share Failure, 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 shareholders 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 shareholder with a proxy statement and shall use its best efforts
to solicit its shareholders’ approval of such increase in authorized shares of Common Stock and to cause its board of directors
to recommend to the shareholders that they approve such proposal. Notwithstanding the foregoing, if any such time of an Authorized Share
Failure, the Company is able to obtain the approval of holders of a majority of the shares of Common Stock voting at a general meeting
to approve the increase in the number of authorized shares of Common Stock, the Company may satisfy this obligation by obtaining such
approval.
2. Reserved.
3. RIGHTS UPON DISTRIBUTION
OF ASSETS. 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 and while the Warrant is outstanding, then, in each such case, the Exercise Price shall be adjusted by multiplying
the Exercise Price in effect immediately prior to the record date fixed for determination of shareholders entitled to receive such distribution
by a fraction of which the denominator shall be the Weighted Average Price determined as of the record date mentioned above, and of which
the numerator shall be such Weighted Average Price on such record date less the then per share fair market value at such record date of
the portion of such assets or evidence of indebtedness or rights or warrants so distributed applicable to one outstanding share of Common
Stock as determined by the Board of Directors in good faith. In either case the adjustments shall be described in a statement provided
to the Holder of the portion of assets or evidences of indebtedness so distributed or such subscription rights applicable to one share
of Common Stock. Such adjustment shall be made whenever any such distribution is made and shall become effective immediately after the
record date mentioned above.
4. PURCHASE RIGHTS; FUNDAMENTAL
TRANSACTIONS.
(a) Purchase Rights.
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, issue or sale of such Purchase Rights (provided,
however, that to the extent that the Holder’s right to participate in any such Purchase Right would result in the Holder
and the other Attribution Parties exceeding the Maximum Percentage, then the Holder shall not be entitled to participate in such Purchase
Right to such extent (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) and such Purchase Right to such extent shall be held in abeyance for the benefit of the Holder
until such time or times 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 the Successor Entity assumes in writing all of the obligations
of the Company under this Warrant and the other Transaction Documents in accordance with the provisions of this Section 4(b) pursuant
to written agreements in form and substance satisfactory to the Required Holders, including agreements, if so requested by the Holder,
to deliver to each holder of the SPA Warrants in exchange for such SPA Warrants a security of the Successor Entity evidenced by a written
instrument substantially similar in form and substance to this Warrant, including, without limitation, an adjusted exercise price equal
to the value for the Common Stock reflected by the terms of such Fundamental Transaction, and exercisable for a corresponding number of
shares of capital stock equivalent to the 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 satisfactory to the Required Holders, 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 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 occurrence or consummation of such Fundamental Transaction). Any security issuable or potentially issuable to the Holder
pursuant to the terms of this Warrant on the consummation of a Fundamental Transaction that was within the Company’s control to
enter into or to avoid shall be registered and freely tradable by the Holder without any restriction or limitation or the requirement
to be subject to any holding period pursuant to any applicable securities laws. No later than (i)
thirty (30) days prior to the occurrence or consummation of any Fundamental Transaction or (ii) if later, the first Trading Day following
the date the Company first becomes aware of the occurrence or potential occurrence of a Fundamental Transaction, the Company shall deliver
written notice thereof via facsimile or electronic mail and overnight courier to the Holder. Upon the occurrence or consummation
of any Fundamental Transaction that was within the Company’s control to enter into or to avoid, it shall be a required condition
to the occurrence or consummation of any Fundamental Transaction that, the Company and the Successor Entity or Successor Entities, jointly
and severally, shall succeed to, and the Company shall cause any Successor Entity or Successor Entities to jointly and severally succeed
to, and be added to the term “Company” under this Warrant (so that from and after the date of such Fundamental Transaction,
each and every provision of this Warrant referring to the “Company” shall refer instead to each of the Company and the Successor
Entity or Successor Entities, jointly and severally), and the Company and the Successor Entity or Successor Entities, jointly and severally,
may exercise every right and power of the Company prior thereto and shall assume all of the obligations of the Company prior thereto under
this Warrant with the same effect as if the Company and such Successor Entity or Successor Entities, jointly and severally, had been named
as the Company in this Warrant, and, solely at the request of the Holder, if the Successor Entity and/or Successor Entities is a publicly
traded corporation whose common stock is quoted on or listed for trading on an Eligible Market, shall deliver (in addition to and without
limiting any right under this Warrant) to the Holder in exchange for this Warrant a security of the Successor Entity and/or Successor
Entities evidenced by a written instrument substantially similar in form and substance to this Warrant and exercisable for a corresponding
number of shares of capital stock of the Successor Entity and/or Successor Entities (the “Successor 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 (such corresponding number of shares of Successor Capital Stock to
be delivered to the Holder shall be equal to the greater of (A) the quotient of (i) the aggregate dollar value of all consideration (including
cash consideration and any consideration other than cash (“Non-Cash Consideration”), in such Fundamental Transaction,
as such values are set forth in any definitive agreement for the Fundamental Transaction that has been executed at the time of the first
public announcement of the Fundamental Transaction or, if no such value is determinable from such definitive agreement, as determined
in accordance with Section 12 with the term “Non-Cash Consideration” being substituted for the term “Exercise Price”)
that the Holder would have been entitled to receive upon the happening of such Fundamental Transaction or the record, eligibility or other
determination date for the event resulting in such Fundamental Transaction, had this Warrant been exercised immediately prior to such
Fundamental Transaction or the record, eligibility or other determination date for the event resulting in such Fundamental Transaction
(without regard to any limitations on the exercise of this Warrant) (the “Aggregate Consideration”) divided by (ii)
the per share Closing Sale Price of such Successor Capital Stock on the Trading Day immediately prior to the consummation or occurrence
of the Fundamental Transaction and (B) the product of (i) the quotient obtained by dividing (x) the Aggregate Consideration, by (y) the
Closing Sale Price of the Common Stock on the Trading Day immediately prior to the consummation or occurrence of the Fundamental Transaction
and (ii) the highest exchange ratio pursuant to which any shareholder of the Company may exchange shares of Common Stock for Successor
Capital Stock) (provided, however, to the extent that the Holder’s right to receive any such shares of publicly traded
common stock (or their equivalent) of the Successor Entity would result in the Holder and its other Attribution Parties exceeding the
Maximum Percentage, if applicable, then the Holder shall not be entitled to receive such shares to such extent (and shall not be entitled
to beneficial ownership of such shares of publicly traded common stock (or their equivalent) of the Successor Entity as a result of such
consideration to such extent) and the portion of such shares shall be held in abeyance for the Holder until such time or times, as its
right thereto would not result in the Holder and its other Attribution Parties exceeding the Maximum Percentage, at which time or times
the Holder shall be delivered such shares to the extent as if there had been no such limitation), and such security shall be satisfactory
to the Holder, and with an identical exercise price to the Exercise Price hereunder (such adjustments to the number of shares of capital
stock and such exercise price being for the purpose of protecting after the consummation or occurrence of such Fundamental Transaction
the economic value of this Warrant that was in effect immediately prior to the consummation or occurrence of such Fundamental Transaction,
as elected by the Holder solely at its option). Upon occurrence or consummation of the Fundamental Transaction, and it shall be a required
condition to the occurrence or consummation of such Fundamental Transaction that, the Company and the Successor Entity or Successor Entities
shall deliver to the Holder confirmation that there shall be issued upon exercise of this Warrant at any time after the occurrence or
consummation of the Fundamental Transaction, as elected by the Holder solely at its option, Common Stock, Successor Capital Stock or,
in lieu of the Common Stock or Successor Capital Stock (or other securities, cash, assets or other property purchasable upon the exercise
of this 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 for purposes of clarification may continue to be Common Stock, if
any, that the Holder would have been entitled to receive upon the happening of such Fundamental Transaction or the record, eligibility
or other determination date for the event resulting in such Fundamental Transaction, had this Warrant been exercised immediately prior
to such Fundamental Transaction or the record, eligibility or other determination date for the event resulting in such Fundamental Transaction
(without regard to any limitations on the exercise of this Warrant), as adjusted in accordance with the provisions of this Warrant. In
addition to and not in substitution for any other rights hereunder, prior to the occurrence or consummation of any Fundamental Transaction
pursuant to which holders of shares of Common Stock are entitled to receive securities, cash, assets or other property with respect to
or in exchange for Common Stock (a “Corporate Event”), the Company shall make appropriate provision to ensure that,
and any applicable Successor Entity or Successor Entities shall ensure that, and it shall be a required condition to the occurrence or
consummation of such Corporate Event that, the Holder will thereafter have the right to receive upon exercise of this Warrant at any time
after the occurrence or consummation of the Corporate Event, Common Stock or Successor Capital Stock or, if so elected by the Holder,
in lieu of the Common Stock (or other securities, cash, assets or other property) purchasable upon the exercise of this Warrant prior
to such Corporate Event (but not in lieu of such items still issuable under Sections 3 and 4(a), which shall continue to be receivable
on the Common Stock or on the such shares of stock, securities, cash, assets or any other property otherwise receivable with respect to
or in exchange for Common Stock), such shares of stock, securities, cash, assets or any other property whatsoever (including warrants
or other purchase or subscription rights and any Common Stock) which the Holder would have been entitled to receive upon the occurrence
or consummation of such Corporate Event or the record, eligibility or other determination date for the event resulting in such Corporate
Event, had this Warrant been exercised immediately prior to such Corporate Event or the record, eligibility or other determination date
for the event resulting in such Corporate Event (without regard to any limitations on exercise of this Warrant). Provision made pursuant
to the preceding sentence shall be in a form and substance reasonably satisfactory to the Holder. The provisions of this Section 4(b)
shall apply similarly and equally to successive Fundamental Transactions and Corporate Events.
5. NON-CIRCUMVENTION.
The Company hereby covenants and agrees that the Company will not, by amendment of its Certificate of Incorporation, as amended and restated,
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 Warrant, and will at all
times in good faith carry out all of 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 (i) shall not increase the par value of any Common Stock receivable
upon the exercise of this Warrant above the Exercise Price then in effect, (ii) shall take all such actions as may be necessary or appropriate
in order that the Company may validly and legally issue fully paid and nonassessable shares of Common Stock upon the exercise of this
Warrant, and (iii) shall, so long as any of the SPA Warrants 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 exercise of the SPA Warrants, 100%
of the number of shares of Common Stock as shall from time to time be necessary to effect the exercise of the SPA Warrants then outstanding
(without regard to any limitations on exercise ).
6. WARRANT HOLDER NOT DEEMED
A SHAREHOLDER. Except as otherwise specifically provided herein, the Holder, solely in such Person’s 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 such Person’s capacity as the Holder
of this Warrant, any of the rights of a shareholder 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 such
Person 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 shareholder
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 shareholders of the Company generally,
contemporaneously with the giving thereof to the shareholders.
7. REISSUANCE OF WARRANTS.
(a) Transfer of Warrant.
If this Warrant is to be transferred, the Holder shall surrender this Warrant to the Company, whereupon the Company will forthwith issue
and deliver upon the order of the Holder a new Warrant (in accordance with Section 7(d)), registered as the Holder may request, representing
the right to purchase the number of Warrant Shares being transferred by the Holder and, if less than the total number of Warrant Shares
then underlying this Warrant is being transferred, a new Warrant (in accordance with Section 7(d)) to the Holder representing the right
to purchase the number of Warrant Shares not being transferred.
(b) Lost, Stolen or Mutilated
Warrant. Upon receipt by the Company of evidence reasonably satisfactory to the Company of the loss, theft, destruction or mutilation
of this Warrant, and, in the case of loss, theft or destruction, of any indemnification undertaking by the Holder to the Company in customary
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, that no SPA Warrants for fractional Warrant Shares
shall be given.
(d) Issuance of New Warrants.
Whenever the Company is required to issue a new Warrant pursuant to the terms of this Warrant, such new Warrant (i) shall be of like tenor
with this Warrant, (ii) shall represent, as indicated on the face of such new Warrant, the right to purchase the Warrant Shares then underlying
this Warrant (or in the case of a new Warrant being issued pursuant to Section 7(a) or Section 7(c), the Warrant Shares designated by
the Holder which, when added to the number of shares of Common Stock underlying the other new Warrants issued in connection with such
issuance, does not exceed the number of Warrant Shares then underlying this Warrant), (iii) shall have an issuance date, as indicated
on the face of such new Warrant which is the same as the Issuance Date, and (iv) shall have the same rights and conditions as this Warrant.
8. NOTICES. Whenever
notice is required to be given under this Warrant, unless otherwise provided herein, such notice shall be given in accordance with Section
9(f) of the Securities Purchase Agreement. The Company shall provide the Holder with prompt written notice of all actions taken pursuant
to this Warrant, 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 any adjustment of the Exercise 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, (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. It is expressly understood and agreed that the time of exercise specified by the Holder
in each Exercise Notice shall be definitive and may not be disputed or challenged by the Company.
9. AMENDMENT AND WAIVER.
Except as otherwise provided herein, the provisions of this Warrant may be amended or waived 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.
10. GOVERNING LAW; JURISDICTION;
JURY TRIAL. 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 choice of law or conflict of law provision or rule (whether of the State of New York or any other jurisdictions) that would
cause the application of the laws of any jurisdictions other than the State of New York. The Company hereby irrevocably submits to the
exclusive jurisdiction of the state and federal courts sitting in The City of New York, Borough of Manhattan, for the adjudication of
any dispute hereunder or in connection herewith or with any transaction contemplated hereby or discussed herein, and hereby irrevocably
waives, and agrees not to assert in any suit, action or proceeding, any claim that it is not personally subject to the jurisdiction of
any such court, that such suit, action or proceeding is brought in an inconvenient forum or that the venue of such suit, action or proceeding
is improper. The Company hereby irrevocably waives personal service of process and consents to process being served in any such suit,
action or proceeding by mailing a copy thereof to the Company at the address set forth 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. 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, 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.
11. CONSTRUCTION; HEADINGS.
This Warrant shall be deemed to be jointly drafted by the Company and all the Buyers 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.
12. DISPUTE RESOLUTION.
In the case of a dispute as to the determination of the Exercise Price or the arithmetic calculation of the Warrant Shares, the Company
shall submit the disputed determinations or arithmetic calculations via facsimile or electronic mail within two (2) Business Days of receipt
of the Exercise Notice giving rise to such dispute, as the case may be, to the Holder. If the Holder and the Company are unable to agree
upon such determination or calculation of the Exercise Price or the Warrant Shares within three (3) Business Days of such disputed determination
or arithmetic calculation being submitted to the Holder, then the Company shall, within two (2) Business Days submit via facsimile or
electronic mail (a) the disputed determination of the Exercise Price to an independent, reputable investment bank selected by the Company
and approved by the Holder or (b) the disputed arithmetic calculation of the Warrant Shares to the Company’s independent, outside
accountant. The Company shall cause at its expense the investment bank or the accountant, as the case may be, to perform the determinations
or calculations and notify the Company and the Holder of the results no later than ten (10) Business Days from the time it receives the
disputed determinations or calculations. Such investment bank’s or accountant’s determination or calculation, as the case
may be, shall be binding upon all parties absent demonstrable error.
13. REMEDIES, 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 damages for any failure by the Company to comply with
the terms of this Warrant. 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 an injunction restraining
any breach, without the necessity of showing economic loss and without any bond or other security being required.
14. TRANSFER. This Warrant
and the Warrant Shares may be offered for sale, sold, transferred, pledged or assigned without the consent of the Company, except as may
otherwise be required by Section 2(f) of the Securities Purchase Agreement.
15. 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).
16. DISCLOSURE. Upon
receipt or delivery by the Company 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, nonpublic information relating to the Company or its Subsidiaries
(as defined in the Securities Purchase Agreement), the Company shall contemporaneously with any such receipt or delivery publicly disclose
such material, nonpublic information on a Current Report on Form 8-K or otherwise. In the event that the Company believes that a notice
contains material, nonpublic information relating to the Company or its Subsidiaries, the Company so shall indicate to the Holder contemporaneously
with delivery of such notice, and in the absence of any such indication, the Holder shall be allowed to presume that all matters relating
to such notice do not constitute material, nonpublic information relating to the Company or its Subsidiaries.
17. 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.
(b) “Affiliate”
shall have the meaning ascribed to such term in Rule 405 of the 1933 Act.
(c) “Attribution
Parties” means, collectively, the following Persons: (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 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.
(d) “Automatic Exercise
Date” means the Business Day immediately prior to the closing of the merger contemplated under Merger Agreement.
(e) “Bloomberg”
means Bloomberg Financial Markets.
(f) “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.
(g) “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 the 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 on the Pink Open Market. 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
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
pursuant to Section 12. All such determinations to be appropriately adjusted for any stock dividend, stock split, stock combination, reclassification
or other similar transaction during the applicable calculation period.
(h) Reserved.
(i) “Common Stock”
means (i) the Company’s shares of Class A common stock, par value $0.0001 per share, and (ii) any share capital into which such
shares of Class A common stock shall have been changed or any share capital resulting from a reclassification, reorganization or reclassification
of such Class A common stock.
(j) “Convertible
Securities” means any stock or securities (other than Options) directly or indirectly convertible into or exercisable or exchangeable
for shares of Common Stock.
(k) “Eligible Market”
means the Principal Market, the NYSE American, The Nasdaq Global Select Market, The Nasdaq Global Market, The New York Stock Exchange,
Inc., the OTC QB or the OTC QX.
(l) Reserved.
(m) Reserved.
(n) “Fundamental
Transaction” means (A) that, except as contemplated under the Agreement and Plan of Merger, dated as of October 23, 2024, by
and among the Company, NXU Merger Sub, Inc., a Delaware corporation, NXU Merger Sub, LLC, a Delaware limited liability company, and Verde
Bioresins, Inc., a Delaware corporation (the “Merger Agreement”), 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 (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 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, except as contemplated under the Merger Agreement, 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 shares of Common Stock, (y) at least 50% of the aggregate ordinary voting power represented
by issued and outstanding shares of Common Stock not held by all such Subject Entities as of the Subscription Date calculated as if any
shares of Common Stock held by all such Subject Entities were not outstanding, or (z) a percentage of the aggregate ordinary voting power
represented by issued and outstanding shares of Common Stock or other equity securities of the Company sufficient to allow such Subject
Entities to effect a statutory short form merger or other transaction requiring other shareholders of the Company to surrender their shares
of Common Stock without approval of the shareholders of the Company or (C) except as contemplated under the Merger Agreement, 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.
(o) “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.
(p) “Options”
means any rights, warrants or options to subscribe for or purchase (i) shares of Common Stock or (ii) Convertible Securities.
(q) “Parent Entity”
of a Person means an entity that, directly or indirectly, controls the applicable Person, including such entity whose common capital or
equivalent equity security is quoted or listed on an Eligible Market (or, if so elected by the Required Holders, any other market, exchange
or quotation system), or, if there is more than one such Person or such entity, the Person or such entity designated by the Required Holders
or in the absence of such designation, such Person or entity with the largest public market capitalization as of the date of consummation
of the Fundamental Transaction.
(r) “Person”
means an individual, a limited liability company, a partnership, a joint venture, a corporation, a trust, an unincorporated organization,
any other entity and a government or any department or agency thereof.
(s) “Pre-Funded Warrants”
shall have the meaning ascribed to such term in the Securities Purchase Agreement.
(t) “Principal Market”
means The Nasdaq Capital Market.
(u) Reserved.
(v) Reserved.
(w) Reserved.
(x) “Registrable
Securities” shall have the meaning ascribed to such term in the Registration Rights Agreement.
(y) “Registration
Rights Agreement” means that certain Registration Rights Agreement dated as of the Subscription Date by and among the Company
and the Buyers.
(z) “Registration
Statement” means a registration statement meeting the requirements set forth in the Registration Rights Agreement and covering
the resale by the Buyers of the Registrable Securities (as defined in the Registration Rights Agreement).
(aa) “Required Holders”
means the holders of the SPA Warrants representing at least a majority of the shares of Common Stock underlying the SPA Warrants then
outstanding.
(bb) Reserved.
(cc) Reserved.
(dd) Reserved.
(ee) “Standard Settlement
Period” means the standard settlement period, expressed in a number of Trading Days, on the Company’s primary Eligible
Market with respect to the shares of Common Stock as in effect on the date of delivery of the applicable Exercise Notice.
(ff) Reserved.
(gg) “Subject Entity”
means any Person, Persons or Group or any Affiliate or associate of any such Person, Persons or Group.
(hh) “Successor Entity”
means one or more Person or Persons (or, if so elected by the Holder, the Company or Parent Entity) formed by, resulting from or surviving
any Fundamental Transaction or one or more Person or Persons (or, if so elected by the Holder, the Company or the Parent Entity) with
which such Fundamental Transaction shall have been entered into.
(ii) “Trading Day”
means 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 on such day, then on the principal securities exchange or securities market on which the Common Stock is then traded.
(jj) “Weighted Average
Price” means, for any security as of any date, the dollar volume-weighted average price for such security on the Principal Market
during the period beginning at 9:30:01 a.m., New York time (or such other time as the Principal Market publicly announces is the official
open of trading), and ending at 4:00:00 p.m., New York time (or such other time as the Principal Market publicly announces is the official
close of trading), as reported by Bloomberg through its “Volume at Price” function 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 9:30:01 a.m., New York time (or such other time as such market publicly announces is the official open
of trading), and ending at 4:00:00 p.m., New York time (or such other time as such market publicly announces is the official close of
trading), 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 on the Pink Open Market. If the Weighted Average Price cannot be calculated for a security on a particular date on any of the
foregoing bases, the Weighted Average 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 pursuant to Section 12 with the term “Weighted Average Price” being substituted for the term “Exercise
Price.” All such determinations shall be appropriately adjusted for any stock dividend, stock split, stock combination, reclassification
or other similar transaction during the applicable calculation 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.
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NXU, INC. |
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EXHIBIT A
EXERCISE NOTICE
TO BE EXECUTED BY THE REGISTERED HOLDER TO EXERCISE
THIS
WARRANT TO PURCHASE COMMON STOCK
NXU, INC.
The undersigned holder hereby
exercises the right to purchase _________________ shares of Common Stock (“Warrant Shares”) of NXU, INC., a Delaware
corporation (the “Company”), evidenced by the attached Warrant to Purchase Common Stock (the “Warrant”).
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 Exercise Price shall be made as:
____________ a “Cash
Exercise” with respect to _________________ Warrant Shares; and/or
____________ a “Cashless
Exercise” with respect to _______________ Warrant Shares, resulting in a delivery obligation of the Company to the Holder of
__________ shares of Common Stock representing the applicable Net Number.
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 the holder __________ Warrant Shares in accordance with the terms of the Warrant.
Date: _______________ __, ______
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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 [________], 20[__] from the Company and acknowledged and agreed to by [_____].
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NXU, INC. |
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Name: |
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Title: |
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Exhibit 4.2
FORM OF SERIES A WARRANT
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 SELECTED BY THE HOLDER, IN A GENERALLY ACCEPTABLE FORM, THAT REGISTRATION IS NOT REQUIRED UNDER SAID ACT OR (II)
UNLESS 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.
NXU, INC.
Series
A Warrant To Purchase Common Stock
Warrant No.: _________
Number of Warrant Shares: _____________
Date of Issuance: December 30, 2024 (“Issuance Date”)
Nxu, Inc., a Delaware corporation
(the “Company”), hereby certifies that, for good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, [HOLDER], 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, at any time or times on or after the date Stockholder Approval
is received and effective until the earlier of the date on which this Warrant is exercised in full and the Automatic Exercise Date (as
defined below), ______________ (_____________) fully paid nonassessable shares of Common Stock, subject to adjustment as provided herein
(the “Warrant Shares”). Except as otherwise defined herein, capitalized terms in this Warrant to Purchase shares of
Common Stock (including any Warrants to Purchase shares of Common Stock issued in exchange, transfer or replacement hereof, this “Warrant”),
shall have the meanings set forth in Section 17. This Warrant is one of the Series A Warrants to purchase shares of Common Stock (the
“SPA Warrants”) issued pursuant to Section 1 of that certain Securities Purchase Agreement, dated as of December 26,
2024 (the “Subscription Date”), by and among the Company and the investors (the “Buyers”) referred
to therein (the “Securities Purchase Agreement”). Capitalized terms used herein and not otherwise defined shall have
the definitions ascribed to such terms in the Securities Purchase Agreement.
1. EXERCISE OF WARRANT.
(a) Mechanics of
Exercise. Subject to the terms and conditions hereof (including, without limitation, the limitations set forth in Section 1(f)),
this Warrant may be exercised, in whole or in part, by the Holder at any time or times on or after the date Stockholder Approval is
received and effective through the time of the closing of the merger contemplated by the Merger Agreement (as defined below) on the
Automatic Exercise Date (such time on the Automatic Exercise Date, the “Automatic Exercise Time”), by (i)
delivery (whether via email 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 and (ii) (A) payment to the Company
of an amount equal to the applicable Exercise Price in effect on the date of such exercise multiplied by the number of Warrant
Shares as to which this Warrant is being exercised (the “Aggregate Exercise Price”) in cash by wire transfer of
immediately available funds or (B) if the provisions of Section 1(d) are applicable, by notifying the Company in the Exercise Notice
that this Warrant is being exercised pursuant to a Cashless Exercise (as defined in Section 1(d)). Any portion of this Warrant that
has not previously been exercised as of the Automatic Exercise Time shall be automatically exercised as of such Automatic Exercise
Time (concurrently with the closing of the merger contemplated by the Merger Agreement) pursuant to a Cashless Exercise, subject to
(i) Stockholder Approval is received and effective through the Automatic Exercise Date and (ii) the beneficial ownership limitation
set forth in Section 1(f) herein. The Holder shall not be required to deliver the original Warrant in order to effect an exercise
hereunder. Execution and delivery of the Exercise Notice with respect to less than all of the Warrant Shares shall have the same
effect as cancellation of the original Warrant and issuance of a new Warrant evidencing the right to purchase the remaining number
of Warrant Shares. On or before the first (1st) Trading Day following the date on which the Company has received the
Exercise Notice, the Company shall transmit by electronic mail an acknowledgment of confirmation of receipt of the Exercise Notice
to the Holder and the Company’s transfer agent (the “Transfer Agent”). On or before the earlier of (i) the
first (1st) Trading Day and (ii) the number of Trading Days comprising the Standard Settlement Period, in each case,
following the date on which the Holder delivers the Exercise Notice to the Company, so long as the Holder delivers the Aggregate
Exercise Price (or notice of a Cashless Exercise) on or prior to the Trading Day following the date on which the Company has
received the Exercise Notice (the “Share Delivery Date”) (provided that if the Aggregate Exercise Price has not
been delivered by such date and the Holder has indicated in the Exercise Notice that the Holder is exercising the Warrant for cash,
the Share Delivery Date shall be one (1) Trading Day after the Aggregate Exercise Price is delivered), the Company shall (X)
provided that the Transfer Agent is participating in The Depository Trust Company (“DTC”) Fast Automated
Securities Transfer Program and (A) the Warrant Shares are subject to an effective resale registration statement in favor of the
Holder or (B) if exercised via Cashless Exercise, at a time when Rule 144 would be available for resale of the Warrant Shares by the
Holder, credit 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, or (Y) if the
Transfer Agent is not participating in the DTC Fast Automated Securities Transfer Program or (A) the Warrant Shares are not subject
to an effective resale registration statement in favor of the Holder or (B) if exercised via Cashless Exercise, at a time when Rule
144 would not be available for resale of the Warrant Shares by the Holder, deliver to the Holder, book entry statements evidencing
the Warrant Shares, for the number of Warrant Shares to which the Holder is entitled pursuant to such exercise. The Company shall be
responsible for all fees and expenses of the Transfer Agent and all fees and expenses with respect to the issuance of Warrant Shares
via DTC, if any. Upon delivery of the 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 book entry statements 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, then the Company shall as soon as practicable and in no event later than three (3) Trading Days after any
exercise and at its own expense, issue a new Warrant (in accordance with Section 7(d)) representing the right to purchase the number
of Warrant Shares issuable immediately prior to such exercise under this Warrant, less the number of Warrant Shares with respect to
which this Warrant is exercised. No fractional Warrant Shares or scrip representing fractional shares are to be issued upon the
exercise of this Warrant. As to any fraction of a share to which the Holder would otherwise be entitled to purchase upon exercise,
the Company shall, at its election, either pay a cash adjustment in respect of such final fraction in an amount equal to such
fraction multiplied by the Exercise Price or round up to the nearest whole share. The Company shall pay any and all taxes which may
be payable with respect to the issuance and delivery of Warrant Shares upon exercise of this Warrant. The Company’s
obligations to issue and deliver Warrant Shares in accordance with the terms and subject to the conditions hereof are absolute and
unconditional, irrespective of any action or inaction by the Holder to enforce the same, any waiver or consent with respect to any
provision hereof, the recovery of any judgment against any Person or any action to enforce the same, or any setoff, counterclaim,
recoupment, limitation or termination.
(b) Exercise Price.
For purposes of this Warrant, “Exercise Price” means $0.50 per share, subject to adjustment as provided herein.
(c) Company’s
Failure to Timely Deliver Securities. Unless such failure is not caused by the Company, if the Company fails to deliver to the
Holder the Warrant Shares subject to a Notice of Exercise by the Share Delivery Date, the Company shall pay to the Holder, in cash,
as liquidated damages and not as a penalty, for each $1,000 of Warrant Shares subject to such exercise (based on the Weighted
Average Price of the Common Stock on the date of the applicable Notice of Exercise), $10 per Trading Day (increasing to $20 per
Trading Day on the third Trading Day after the Share Delivery Date) for each Trading Day after such Share Delivery Date until such
Warrant Shares are delivered or Holder rescinds such exercise. Additionally, if the Company shall fail (and such failure is not
caused by any third party action or failure to act) to cause the Transfer Agent to transmit to the Holder on or prior to the Share
Delivery Date Warrant Shares pursuant to an exercise notice delivered by the Holder and if after such date the Holder is required by
its broker to purchase (in an open market transaction or otherwise) or the Holder’s brokerage firm otherwise purchases, shares
of Common Stock to deliver in satisfaction of a sale by the Holder of the Warrant Shares which the Holder anticipated receiving upon
such exercise (a “Buy-In”), then the Company shall, within one (1) Trading Day after the Holder’s request,
(a) pay in cash to the Holder the amount, if any, by which (x) the Holder’s total purchase price (including brokerage
commissions, if any) for the shares of Common Stock so purchased exceeds (y) the amount obtained by multiplying (1) the number of
Warrant Shares that the Company was required to deliver to the Holder in connection with the exercise at issue times (2) the price
at which the sell order giving rise to such purchase obligation was executed, and (b) at the option of the Holder, either reinstate
the portion of the Warrant and equivalent number of Warrant Shares for which such exercise was not honored (in which case such
exercise shall be deemed rescinded) or deliver to the Holder the number of shares of Common Stock that would have been issued had
the Company timely complied with its exercise and delivery obligations hereunder. For example, if the Holder purchases shares of
Common Stock having a total purchase price of $11,000 to cover a Buy-In with respect to an attempted exercise of Common Stock with
an aggregate sale price giving rise to such purchase obligation of $10,000, under clause (a) of the immediately preceding sentence
the Company shall be required to pay the Holder $1,000. The Holder shall provide the Company written notice indicating the amounts
payable to the Holder in respect of the Buy-In and evidence of the amount of such loss. 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 shares of
Common Stock upon the exercise of this Warrant as required pursuant to the terms hereof.
(d) Cashless Exercise.
Notwithstanding anything contained herein to the contrary, if the Registration Statement covering the resale of the Warrant Shares is
not available for the resale of such Warrant Shares, 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 Common Stock 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 if such exercise were by means of a cash exercise rather than a Cashless Exercise. |
| B = |
as applicable: (i) the Weighted Average Price of the 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) of Regulation NMS promulgated under the federal securities laws) on such Trading Day, (ii) at the option of the Holder, either (y) the Weighted Average Price on the Trading Day immediately preceding the date of the applicable Exercise Notice or (z) the bid price of the Common Stock on the principal Trading Market as reported by Bloomberg 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 (including until two (2) hours after the close of “regular trading hours” on a Trading Day) pursuant to Section 1(a) hereof or (iii) the Weighted Average 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 pursuant to this
Section 1(d), the Company hereby acknowledges and agrees that, in accordance with Section 3(a)(9) of the 1933 Act, 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. The Company
agrees not to take any position contrary to this Section 1(d).
Whether or not an effective
registration statement is available, the Holder may also effect an “alternative cashless exercise” after the Stockholder Consent
has been obtained but prior to the Automatic Exercise Time. In such event, the aggregate number of Warrant Shares issuable in such alternative
cashless exercise pursuant to any given Exercise Notice electing to effect an alternative cashless exercise shall equal the product of
(i) the aggregate number of Warrant Shares that would be issuable upon exercise of this Warrant in accordance with the terms of
this Warrant if such exercise were by means of a cash exercise rather than a cashless exercise, multiplied by (ii) 1.0.
(e) Disputes. In the
case of a dispute as to the determination of the Exercise Price or the arithmetic calculation of the Warrant Shares, 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 12.
(f) Beneficial
Ownership Limitations on Exercises. Notwithstanding anything to the contrary contained herein, 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 number of 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 the number of 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) and Pre-Funded
Warrants or Series B Warrants (as defined in the Securities Purchase Agreement) 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). For
purposes of this Section 1(f), beneficial ownership shall be calculated in accordance with Section 13(d) of the Securities Exchange
Act of 1934, as amended (the “1934 Act”). For purposes of this Warrant, in 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 Securities and Exchange
Commission (the “SEC”), as the case may be, (y) a more recent public announcement by the Company or (3) any other
written notice by the Company or the Transfer Agent 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), to exceed the Maximum
Percentage, the Holder must notify the Company of a reduced number of Warrant Shares to be purchased 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 request of the Holder, the Company shall within one (1) Trading Day confirm 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-1(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) 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) 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) Insufficient Authorized
Shares. If at any time while this Warrant remains 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 exercise of this Warrant at least a number of shares of
Common Stock equal to 100% of the number of shares of Common Stock as shall from time to time be necessary to effect the exercise of all
of this Warrant then outstanding without regard to any limitation on exercise included herein and assuming that the shares underlying
this Warrant are adjusted based on a Reset Price equal to $0.0524 (as adjusted for stock splits, stock dividends, recapitalizations, reorganizations,
reclassification, combinations, reverse stock splits, or other similar events occurring after the Subscription Date) (the “Required
Reserve Amount” and the failure to have such sufficient number of authorized and unreserved shares of Common Stock, 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 this Warrant then outstanding.
Without limiting the generality of the foregoing sentence, if shareholder approval is required to cure an Authorized Share Failure, 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 shareholders 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 shareholder with a
proxy statement and shall use its best efforts to solicit its shareholders’ approval of such increase in authorized shares of Common
Stock and to cause its board of directors to recommend to the shareholders that they approve such proposal. Notwithstanding the foregoing,
if any such time of an Authorized Share Failure, the Company is able to obtain the approval of holders of a majority of the shares of
Common Stock voting at a general meeting to approve the increase in the number of authorized shares of Common Stock, the Company may satisfy
this obligation by obtaining such approval.
(h) Stockholder Approval.
The Company shall file with the SEC a preliminary proxy statement within ten (10) Business Days of the Closing Date and shall use its
commercially reasonable efforts to hold a special meeting of stockholders on or prior to forty-five (45) days after the Closing Date (as
defined in the Securities Purchase Agreement), for the purpose of obtaining the Stockholder Approval, with the recommendation of the Company’s
Board of Directors that such proposal be approved, and the Company shall solicit proxies from its stockholders in connection therewith
in the same manner as all other management proposals in such proxy statement and all management-appointed proxyholders shall vote their
proxies in favor of such proposal. The Company shall use its commercially reasonable efforts to obtain such Stockholder Approval. If the
Company does not obtain Stockholder Approval at the first meeting, the Company shall call a meeting every ninety (90) days thereafter
to seek Stockholder Approval until the earlier of the date on which Stockholder Approval is obtained or the Warrants are no longer outstanding.
2. ADJUSTMENT OF EXERCISE
PRICE AND NUMBER OF WARRANT SHARES. The Exercise Price and the number of Warrant Shares shall be adjusted from time to time as follows:
(a) Reserved.
(b) Voluntary Adjustment
By Company. Subject to the rules and regulations of the primary Trading Market, the Company may at any time after the Reset Date but
during the term of this Warrant, with the prior written consent of the Required Holders, 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.
(c) Adjustment Upon Subdivision
or Combination of Common Stock. If the Company at any time on or after the Subscription Date subdivides (by any stock split, stock
dividend, recapitalization or otherwise) one or more classes of its outstanding shares of Common Stock into a greater number of shares,
the Exercise Price in effect immediately prior to such subdivision will be proportionately reduced and the number of Warrant Shares will
be proportionately increased 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. If the Company at any time on
or after the Subscription Date combines (by combination, reverse stock split or otherwise) one or more classes of its outstanding shares
of Common Stock into a smaller number of shares, the Exercise Price in effect immediately prior to such combination will be proportionately
increased and the number of Warrant Shares will be proportionately decreased 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. Any adjustment under this Section 2(c) shall become effective at the close of business on the date the subdivision
or combination becomes effective.
(d) Reset.
(i) On a Reset Date
(as such term is defined in the Series B Warrants), the Exercise Price shall be adjusted to equal the lower of (i) the Exercise Price
then in effect and (ii) the Reset Price determined as of the date of determination for such Reset Date. Upon such reset of the Exercise
Price pursuant to this Section 2(d), the number of Warrant Shares issuable hereunder will be proportionately increased 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 on the Issuance Date for the Warrant Shares as to which this Warrant is being exercised (such increased number of Warrant
Shares, the “Reset Share Amount”).
(ii)
Notwithstanding the foregoing, if a Holder requests to exercise this Warrant in whole or in part on any given date during the Reset
Period (as such term is defined in the Series B Warrants) but prior to the Reset Date, solely with respect to such portion of this
Warrant being exercised on such applicable Exercise Date, (a) such applicable Reset Date shall be deemed to mean the Exercise Date,
(b) such applicable Reset Period (as such term is defined in the Series B Warrants) shall be deemed to have ended on the Trading Day
immediately prior to the Exercise Date and (c) the applicable Reset Price and Reset Share Amount for such exercised Warrants shall
be calculated pursuant to Section 2(d)(i). For the avoidance of doubt, following the calculation of the Reset Price and Reset Share
Amount for the exercised portion of this Warrant pursuant to this Section 2(d)(ii), the Company’s obligations with regard to
such exercised portion of this Warrant shall be deemed satisfied and no additional Reset Price and Reset Share Amount shall apply to
such exercised portion of this Warrant.
(iii) Partial Reset.
If a portion of the Warrant Shares (but not all of the Warrant Shares) comprising the Registrable Securities have been registered for
resale in the manner prescribed in clause (i) of the definition of Reset Date, then the Holder, in such Holder’s sole discretion,
may deem the conditions for a Reset satisfied with respect to such Warrants that have been registered for resale such that the terms of
Section 2(d)(i) and (d)(ii) shall apply to such Warrants. For the avoidance of doubt, the Company’s obligations will continue to
apply with regard to the Warrants comprising the Registrable Securities which have not been registered for resale.
(e) Other Events. 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 will make an appropriate adjustment in the Exercise Price and the number of Warrant Shares, as mutually determined
by the Company’s Board of Directors and the Required Holders, so as to protect the rights of the Holder; provided that no
such adjustment pursuant to this Section 2(f) will increase the Exercise Price or decrease the number of Warrant Shares as otherwise determined
pursuant to this Section 2.
3. RIGHTS UPON DISTRIBUTION
OF ASSETS. 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 and while the Warrant is outstanding, then, in each such case, the Exercise Price shall be adjusted by multiplying
the Exercise Price in effect immediately prior to the record date fixed for determination of shareholders entitled to receive such distribution
by a fraction of which the denominator shall be the Weighted Average Price determined as of the record date mentioned above, and of which
the numerator shall be such Weighted Average Price on such record date less the then per share fair market value at such record date of
the portion of such assets or evidence of indebtedness or rights or warrants so distributed applicable to one outstanding share of Common
Stock as determined by the Board of Directors in good faith. In either case the adjustments shall be described in a statement provided
to the Holder of the portion of assets or evidences of indebtedness so distributed or such subscription rights applicable to one share
of Common Stock. Such adjustment shall be made whenever any such distribution is made and shall become effective immediately after the
record date mentioned above.
4. PURCHASE RIGHTS; FUNDAMENTAL
TRANSACTIONS.
(a) Purchase Rights.
In addition to any adjustments pursuant to Section 2 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, issue or sale of such Purchase Rights (provided, however, that to the extent that the Holder’s right to participate
in any such Purchase Right would result in the Holder and the other Attribution Parties exceeding the Maximum Percentage, then the Holder
shall not be entitled to participate in such Purchase Right to such extent (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) and such Purchase Right to such extent
shall be held in abeyance for the benefit of the Holder until such time or times 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 the Successor Entity assumes in
writing all of the obligations of the Company under this Warrant and the other Transaction Documents in accordance with the
provisions of this Section 4(b) pursuant to written agreements in form and substance satisfactory to the Required Holders, including
agreements, if so requested by the Holder, to deliver to each holder of the SPA Warrants in exchange for such SPA Warrants a
security of the Successor Entity evidenced by a written instrument substantially similar in form and substance to this Warrant,
including, without limitation, an adjusted exercise price equal to the value for the Common Stock reflected by the terms of such
Fundamental Transaction, and exercisable for a corresponding number of shares of capital stock equivalent to the 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 satisfactory to the Required Holders, 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 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 occurrence or
consummation of such Fundamental Transaction). Any security issuable or potentially issuable to the Holder pursuant to the terms of
this Warrant on the consummation of a Fundamental Transaction that was within the Company’s control to enter into or to avoid
shall be registered and freely tradable by the Holder without any restriction or limitation or the requirement to be subject to any
holding period pursuant to any applicable securities laws. No later than (i) thirty (30) days
prior to the occurrence or consummation of any Fundamental Transaction or (ii) if later, the first Trading Day following the date
the Company first becomes aware of the occurrence or potential occurrence of a Fundamental Transaction, the Company shall deliver
written notice thereof via facsimile or electronic mail and overnight courier to the Holder. Upon the occurrence or consummation of
any Fundamental Transaction that was within the Company’s control to enter into or to avoid, it shall be a required condition
to the occurrence or consummation of any Fundamental Transaction that, the Company and the Successor Entity or Successor Entities,
jointly and severally, shall succeed to, and the Company shall cause any Successor Entity or Successor Entities to jointly and
severally succeed to, and be added to the term “Company” under this Warrant (so that from and after the date of such
Fundamental Transaction, each and every provision of this Warrant referring to the “Company” shall refer instead to each
of the Company and the Successor Entity or Successor Entities, jointly and severally), and the Company and the Successor Entity or
Successor Entities, jointly and severally, may exercise every right and power of the Company prior thereto and shall assume all of
the obligations of the Company prior thereto under this Warrant with the same effect as if the Company and such Successor Entity or
Successor Entities, jointly and severally, had been named as the Company in this Warrant, and, solely at the request of the Holder,
if the Successor Entity and/or Successor Entities is a publicly traded corporation whose common stock is quoted on or listed for
trading on an Eligible Market, shall deliver (in addition to and without limiting any right under this Warrant) to the Holder in
exchange for this Warrant a security of the Successor Entity and/or Successor Entities evidenced by a written instrument
substantially similar in form and substance to this Warrant and exercisable for a corresponding number of shares of capital stock of
the Successor Entity and/or Successor Entities (the “Successor 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 (such corresponding number of shares of Successor Capital Stock to be delivered to the Holder
shall be equal to the greater of (A) the quotient of (i) the aggregate dollar value of all consideration (including cash
consideration and any consideration other than cash (“Non-Cash Consideration”), in such Fundamental Transaction,
as such values are set forth in any definitive agreement for the Fundamental Transaction that has been executed at the time of the
first public announcement of the Fundamental Transaction or, if no such value is determinable from such definitive agreement, as
determined in accordance with Section 12 with the term “Non-Cash Consideration” being substituted for the term
“Exercise Price”) that the Holder would have been entitled to receive upon the happening of such Fundamental Transaction
or the record, eligibility or other determination date for the event resulting in such Fundamental Transaction, had this Warrant
been exercised immediately prior to such Fundamental Transaction or the record, eligibility or other determination date for the
event resulting in such Fundamental Transaction (without regard to any limitations on the exercise of this Warrant) (the
“Aggregate Consideration”) divided by (ii) the per share Closing Sale Price of such Successor Capital Stock on
the Trading Day immediately prior to the consummation or occurrence of the Fundamental Transaction and (B) the product of (i) the
quotient obtained by dividing (x) the Aggregate Consideration, by (y) the Closing Sale Price of the Common Stock on the Trading Day
immediately prior to the consummation or occurrence of the Fundamental Transaction and (ii) the highest exchange ratio pursuant to
which any shareholder of the Company may exchange shares of Common Stock for Successor Capital Stock) (provided, however,
to the extent that the Holder’s right to receive any such shares of publicly traded common stock (or their equivalent) of the
Successor Entity would result in the Holder and its other Attribution Parties exceeding the Maximum Percentage, if applicable, then
the Holder shall not be entitled to receive such shares to such extent (and shall not be entitled to beneficial ownership of such
shares of publicly traded common stock (or their equivalent) of the Successor Entity as a result of such consideration to such
extent) and the portion of such shares shall be held in abeyance for the Holder until such time or times, as its right thereto would
not result in the Holder and its other Attribution Parties exceeding the Maximum Percentage, at which time or times the Holder shall
be delivered such shares to the extent as if there had been no such limitation), and such security shall be satisfactory to the
Holder, and with an identical exercise price to the Exercise Price hereunder (such adjustments to the number of shares of capital
stock and such exercise price being for the purpose of protecting after the consummation or occurrence of such Fundamental
Transaction the economic value of this Warrant that was in effect immediately prior to the consummation or occurrence of such
Fundamental Transaction, as elected by the Holder solely at its option). Upon occurrence or consummation of the Fundamental
Transaction, and it shall be a required condition to the occurrence or consummation of such Fundamental Transaction that, the
Company and the Successor Entity or Successor Entities shall deliver to the Holder confirmation that there shall be issued upon
exercise of this Warrant at any time after the occurrence or consummation of the Fundamental Transaction, as elected by the Holder
solely at its option, Common Stock, Successor Capital Stock or, in lieu of the Common Stock or Successor Capital Stock (or other
securities, cash, assets or other property purchasable upon the exercise of this 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 for purposes of clarification may continue to be Common Stock, if any, that the Holder would have been
entitled to receive upon the happening of such Fundamental Transaction or the record, eligibility or other determination date for
the event resulting in such Fundamental Transaction, had this Warrant been exercised immediately prior to such Fundamental
Transaction or the record, eligibility or other determination date for the event resulting in such Fundamental Transaction (without
regard to any limitations on the exercise of this Warrant), as adjusted in accordance with the provisions of this Warrant. In
addition to and not in substitution for any other rights hereunder, prior to the occurrence or consummation of any Fundamental
Transaction pursuant to which holders of shares of Common Stock are entitled to receive securities, cash, assets or other property
with respect to or in exchange for Common Stock (a “Corporate Event”), the Company shall make appropriate
provision to ensure that, and any applicable Successor Entity or Successor Entities shall ensure that, and it shall be a required
condition to the occurrence or consummation of such Corporate Event that, the Holder will thereafter have the right to receive upon
exercise of this Warrant at any time after the occurrence or consummation of the Corporate Event, Common Stock or Successor Capital
Stock or, if so elected by the Holder, in lieu of the Common Stock (or other securities, cash, assets or other property) purchasable
upon the exercise of this Warrant prior to such Corporate Event (but not in lieu of such items still issuable under Sections 3 and
4(a), which shall continue to be receivable on the Common Stock or on the such shares of stock, securities, cash, assets or any
other property otherwise receivable with respect to or in exchange for Common Stock), such shares of stock, securities, cash, assets
or any other property whatsoever (including warrants or other purchase or subscription rights and any Common Stock) which the Holder
would have been entitled to receive upon the occurrence or consummation of such Corporate Event or the record, eligibility or other
determination date for the event resulting in such Corporate Event, had this Warrant been exercised immediately prior to such
Corporate Event or the record, eligibility or other determination date for the event resulting in such Corporate Event (without
regard to any limitations on exercise of this Warrant). Provision made pursuant to the preceding sentence shall be in a form and
substance reasonably satisfactory to the Holder. The provisions of this Section 4(b) shall apply similarly and equally to successive
Fundamental Transactions and Corporate Events.
5. NON-CIRCUMVENTION.
The Company hereby covenants and agrees that the Company will not, by amendment of its Certificate of Incorporation, as amended and restated,
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 Warrant, and will at all
times in good faith carry out all of 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 (i) shall not increase the par value of any Common Stock receivable
upon the exercise of this Warrant above the Exercise Price then in effect, (ii) shall take all such actions as may be necessary or appropriate
in order that the Company may validly and legally issue fully paid and nonassessable shares of Common Stock upon the exercise of this
Warrant, and (iii) shall, so long as any of the SPA Warrants 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 exercise of the SPA Warrants, 100%
of the number of shares of Common Stock as shall from time to time be necessary to effect the exercise of the SPA Warrants then outstanding
(without regard to any limitations on exercise).
6. WARRANT HOLDER NOT DEEMED
A SHAREHOLDER. Except as otherwise specifically provided herein, the Holder, solely in such Person’s 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 such Person’s capacity as the Holder
of this Warrant, any of the rights of a shareholder 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 such
Person 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 shareholder
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 shareholders of the Company generally,
contemporaneously with the giving thereof to the shareholders.
7. REISSUANCE OF WARRANTS.
(a) Transfer of
Warrant. If this Warrant is to be transferred, the Holder shall surrender this Warrant to the Company, whereupon the Company
will forthwith issue and deliver upon the order of the Holder a new Warrant (in accordance with Section 7(d)), registered as the
Holder may request, representing the right to purchase the number of Warrant Shares being transferred by the Holder and, if less
than the total number of Warrant Shares then underlying this Warrant is being transferred, a new Warrant (in accordance with Section
7(d)) to the Holder representing the right to purchase the number of Warrant Shares not being transferred.
(b) Lost, Stolen or Mutilated
Warrant. Upon receipt by the Company of evidence reasonably satisfactory to the Company of the loss, theft, destruction or mutilation
of this Warrant, and, in the case of loss, theft or destruction, of any indemnification undertaking by the Holder to the Company in customary
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, that no SPA Warrants for fractional Warrant Shares
shall be given.
(d) Issuance of New Warrants.
Whenever the Company is required to issue a new Warrant pursuant to the terms of this Warrant, such new Warrant (i) shall be of like tenor
with this Warrant, (ii) shall represent, as indicated on the face of such new Warrant, the right to purchase the Warrant Shares then underlying
this Warrant (or in the case of a new Warrant being issued pursuant to Section 7(a) or Section 7(c), the Warrant Shares designated by
the Holder which, when added to the number of shares of Common Stock underlying the other new Warrants issued in connection with such
issuance, does not exceed the number of Warrant Shares then underlying this Warrant), (iii) shall have an issuance date, as indicated
on the face of such new Warrant which is the same as the Issuance Date, and (iv) shall have the same rights and conditions as this Warrant.
8. NOTICES. Whenever
notice is required to be given under this Warrant, unless otherwise provided herein, such notice shall be given in accordance with Section
9(f) of the Securities Purchase Agreement. The Company shall provide the Holder with prompt written notice of all actions taken pursuant
to this Warrant, 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 any adjustment of the Exercise 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, (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. It is expressly understood and agreed that the time of exercise specified by the Holder
in each Exercise Notice shall be definitive and may not be disputed or challenged by the Company.
9. AMENDMENT AND WAIVER.
Except as otherwise provided herein, the provisions of this Warrant may be amended or waived 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.
10. GOVERNING LAW; JURISDICTION;
JURY TRIAL. 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 choice of law or conflict of law provision or rule (whether of the State of New York or any other jurisdictions) that would
cause the application of the laws of any jurisdictions other than the State of New York. The Company hereby irrevocably submits to the
exclusive jurisdiction of the state and federal courts sitting in The City of New York, Borough of Manhattan, for the adjudication of
any dispute hereunder or in connection herewith or with any transaction contemplated hereby or discussed herein, and hereby irrevocably
waives, and agrees not to assert in any suit, action or proceeding, any claim that it is not personally subject to the jurisdiction of
any such court, that such suit, action or proceeding is brought in an inconvenient forum or that the venue of such suit, action or proceeding
is improper. The Company hereby irrevocably waives personal service of process and consents to process being served in any such suit,
action or proceeding by mailing a copy thereof to the Company at the address set forth 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. 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, 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.
11. CONSTRUCTION; HEADINGS.
This Warrant shall be deemed to be jointly drafted by the Company and all the Buyers 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.
12. DISPUTE
RESOLUTION. In the case of a dispute as to the determination of the Exercise Price or the arithmetic calculation of the Warrant
Shares, the Company shall submit the disputed determinations or arithmetic calculations via facsimile or electronic mail within two
(2) Business Days of receipt of the Exercise Notice giving rise to such dispute, as the case may be, to the Holder. If the Holder
and the Company are unable to agree upon such determination or calculation of the Exercise Price or the Warrant Shares within three
(3) Business Days of such disputed determination or arithmetic calculation being submitted to the Holder, then the Company shall,
within two (2) Business Days submit via facsimile or electronic mail (a) the disputed determination of the Exercise Price to an
independent, reputable investment bank selected by the Company and approved by the Holder or (b) the disputed arithmetic calculation
of the Warrant Shares to the Company’s independent, outside accountant. The Company shall cause at its expense the investment
bank or the accountant, as the case may be, to perform the determinations or calculations and notify the Company and the Holder of
the results no later than ten (10) Business Days from the time it receives the disputed determinations or calculations. Such
investment bank’s or accountant’s determination or calculation, as the case may be, shall be binding upon all parties
absent demonstrable error.
13. REMEDIES, 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 damages for any failure by the Company to comply with
the terms of this Warrant. 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 an injunction restraining
any breach, without the necessity of showing economic loss and without any bond or other security being required.
14. TRANSFER. This Warrant
and the Warrant Shares may be offered for sale, sold, transferred, pledged or assigned without the consent of the Company, except as may
otherwise be required by Section 2(f) of the Securities Purchase Agreement.
15. 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).
16. DISCLOSURE.
Upon receipt or delivery by the Company 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, nonpublic information relating to the Company
or its Subsidiaries (as defined in the Securities Purchase Agreement), the Company shall contemporaneously with any such receipt or
delivery publicly disclose such material, nonpublic information on a Current Report on Form 8-K or otherwise. In the event that the
Company believes that a notice contains material, nonpublic information relating to the Company or its Subsidiaries, the Company so
shall indicate to the Holder contemporaneously with delivery of such notice, and in the absence of any such indication, the Holder
shall be allowed to presume that all matters relating to such notice do not constitute material, nonpublic information relating to
the Company or its Subsidiaries.
17. 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.
(b) “Affiliate”
shall have the meaning ascribed to such term in Rule 405 of the 1933 Act.
(c) “Approved Stock
Plan” means any employee benefit plan or share incentive plan which has been approved by the Board of Directors of the Company,
pursuant to which the Company’s securities may be issued to any employee, officer or director for services provided to the Company.
(d) “Attribution
Parties” means, collectively, the following Persons: (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 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.
(e) “Automatic Exercise
Date” means the date of the closing of the merger contemplated under the Agreement and Plan of Merger, dated as of October 23,
2024, by and among the Company, NXU Merger Sub, Inc., a Delaware corporation, NXU Merger Sub, LLC, a Delaware limited liability company,
and Verde Bioresins, Inc., a Delaware corporation (the “Merger Agreement”).
(f) Reserved.
(g) “Bloomberg”
means Bloomberg Financial Markets.
(h) “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.
(i) “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 the 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 on the Pink Open Market. 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 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 pursuant to Section 12. All such
determinations to be appropriately adjusted for any stock dividend, stock split, stock combination, reclassification or other
similar transaction during the applicable calculation period.
(j) “Closing Date”
shall have the meaning ascribed to such term in the Securities Purchase Agreement.
(k) “Common Stock”
means (i) the Company’s shares of Class A common stock, par value $0.0001 per share, and (ii) any share capital into which such
shares of Class A common stock shall have been changed or any share capital resulting from a reclassification, reorganization or reclassification
of such Class A common stock.
(l) “Convertible
Securities” means any stock or securities (other than Options) directly or indirectly convertible into or exercisable or exchangeable
for shares of Common Stock.
(m) “Eligible Market”
means the Principal Market, the NYSE American, The Nasdaq Global Select Market, The Nasdaq Global Market, The New York Stock Exchange,
Inc., the OTC QB or the OTC QX.
(n) “Excluded
Securities” means any Common Stock or Options issued or issuable or deemed to be issued in accordance with Section 2(a)
hereof by the Company: (i) under any Approved Stock Plan, (ii) upon exercise of any SPA Warrants and any Series B Warrants, in each
case, issued pursuant to the Securities Purchase Agreement; provided, that the terms of such SPA Warrants and Series B
Warrants are not amended, modified or changed on or after the Subscription Date, (iii) upon conversion, exercise or exchange of any
Options or Convertible Securities which are outstanding on the day immediately preceding the Subscription Date; provided,
that such issuance of Common Stock upon exercise of such Options or Convertible Securities is made pursuant to the terms of such
Options or Convertible Securities in effect on the date immediately preceding the Subscription Date and such Options or Convertible
Securities are not amended, modified or changed on or after the Subscription Date (except that any amendments, modifications or
changes to such Options or Convertible Securities are required by the terms thereof), (iv) upon a dividend or distribution to all
holders of Common Stock (including pursuant to a rights plan) or (v) upon a stock split, reverse stock split, distribution of bonus
shares, combination or other recapitalization events.
(o) Intentionally omitted.
(p)
“Fundamental Transaction” means (A) that, except as contemplated under the Merger Agreement, 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 (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 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, except as contemplated under the Merger Agreement, 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
shares of Common Stock, (y) at least 50% of the aggregate ordinary voting power represented by issued and outstanding shares of
Common Stock not held by all such Subject Entities as of the Subscription Date calculated as if any shares of Common Stock held by
all such Subject Entities were not outstanding, or (z) a percentage of the aggregate ordinary voting power represented by issued and
outstanding shares of Common Stock or other equity securities of the Company sufficient to allow such Subject Entities to effect a
statutory short form merger or other transaction requiring other shareholders of the Company to surrender their shares of Common
Stock without approval of the shareholders of the Company or (C) except as contemplated under the Merger Agreement, 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.
(q) “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.
(r) “Options”
means any rights, warrants or options to subscribe for or purchase (i) shares of Common Stock or (ii) Convertible Securities.
(s) “Parent Entity”
of a Person means an entity that, directly or indirectly, controls the applicable Person, including such entity whose common capital or
equivalent equity security is quoted or listed on an Eligible Market (or, if so elected by the Required Holders, any other market, exchange
or quotation system), or, if there is more than one such Person or such entity, the Person or such entity designated by the Required Holders
or in the absence of such designation, such Person or entity with the largest public market capitalization as of the date of consummation
of the Fundamental Transaction.
(t) “Person”
means an individual, a limited liability company, a partnership, a joint venture, a corporation, a trust, an unincorporated organization,
any other entity and a government or any department or agency thereof.
(u) “Pre-Funded Warrants”
shall have the meaning ascribed to such term in the Securities Purchase Agreement.
(v) “Principal Market”
means The Nasdaq Capital Market.
(w) “Public Information
Failure” shall mean any time that the Company shall fail to satisfy any condition set forth in Rule 144(i)(2).
(x) “Purchase Price”
shall have the meaning ascribed to such term in the Securities Purchase Agreement.
(y) “Purchased Shares”
shall have the meaning ascribed to such term in the Securities Purchase Agreement.
(z) “Registrable
Securities” shall have the meaning ascribed to such term in the Registration Rights Agreement.
(aa) “Registration
Rights Agreement” means that certain Registration Rights Agreement dated as of the Subscription Date by and among the Company
and the Buyers.
(bb) “Registration
Statement” means a registration statement meeting the requirements set forth in the Registration Rights Agreement and covering
the resale by the Buyers of the Registrable Securities (as defined in the Registration Rights Agreement).
(cc) “Required Holders”
means the holders of the SPA Warrants representing at least a majority of the shares of Common Stock underlying the SPA Warrants then
outstanding.
(dd) “Reset Date”
shall have the meaning ascribed to such term in the Series B Warrants.
(ee) “Reset Price”
shall have the meaning ascribed to such term in the Series B Warrants.
(ff) “Series B Warrants”
shall have the meaning ascribed to such term in the Securities Purchase Agreement.
(gg) “Standard Settlement
Period” means the standard settlement period, expressed in a number of Trading Days, on the Company’s primary Eligible
Market with respect to the shares of Common Stock as in effect on the date of delivery of the applicable Exercise Notice.
(hh) “Stockholder
Approval” means such approval as may be required by the applicable rules and regulations of The Nasdaq Stock Market LLC (or
any successor entity) from the stockholders of the Company, or board of directors in lieu thereof, with respect to issuance of all of
the Warrants and the Warrant Shares upon the exercise hereof.
(ii) “Subject Entity”
means any Person, Persons or Group or any Affiliate or associate of any such Person, Persons or Group.
(jj) “Successor Entity”
means one or more Person or Persons (or, if so elected by the Holder, the Company or Parent Entity) formed by, resulting from or surviving
any Fundamental Transaction or one or more Person or Persons (or, if so elected by the Holder, the Company or the Parent Entity) with
which such Fundamental Transaction shall have been entered into.
(kk) “Trading Day”
means 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 on such day, then on the principal securities exchange or securities market on which the Common Stock is then traded.
(ll) “Weighted
Average Price” means, for any security as of any date, the dollar volume-weighted average price for such security on the
Principal Market during the period beginning at 9:30:01 a.m., New York time (or such other time as the Principal Market publicly
announces is the official open of trading), and ending at 4:00:00 p.m., New York time (or such other time as the Principal Market
publicly announces is the official close of trading), as reported by Bloomberg through its “Volume at Price” function
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 9:30:01 a.m., New York time (or such other time as such
market publicly announces is the official open of trading), and ending at 4:00:00 p.m., New York time (or such other time as such
market publicly announces is the official close of trading), 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 on the Pink Open Market. If the Weighted Average Price cannot be
calculated for a security on a particular date on any of the foregoing bases, the Weighted Average 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 pursuant to Section 12 with the term
“Weighted Average Price” being substituted for the term “Exercise Price.” All such determinations shall be
appropriately adjusted for any stock dividend, stock split, stock combination, reclassification or other similar transaction during
the applicable calculation 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.
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NXU, INC. |
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EXHIBIT A
EXERCISE NOTICE
TO BE EXECUTED BY THE REGISTERED HOLDER TO EXERCISE
THIS
WARRANT TO PURCHASE COMMON STOCK
NXU, INC.
The undersigned holder hereby
exercises the right to purchase _________________ shares of Common Stock (“Warrant Shares”) of NXU, INC., a Delaware
corporation (the “Company”), evidenced by the attached Warrant to Purchase Common Stock (the “Warrant”).
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 Exercise Price shall be made as:
____________ a “Cash
Exercise” with respect to _________________ Warrant Shares; and/or
____________ a “Cashless
Exercise” with respect to _______________ Warrant Shares, resulting in a delivery obligation of the Company to the Holder of
__________ shares of Common Stock representing the applicable Net Number
____________ an
“alternative cashless exercise” pursuant to the last paragraph of Section 1(d) of the Warrant, with respect to
_______________ Warrant Shares, resulting in a delivery obligation of the Company to the Holder of __________ shares of Common
Stock
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 the holder __________ Warrant Shares in accordance with the terms of the Warrant.
Date: _______________ __, ______
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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 [________], 20[__] from the Company and acknowledged and agreed to by [_____].
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NXU, INC. |
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Exhibit 4.3
FORM OF SERIES B WARRANT
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 SELECTED BY THE HOLDER, IN A GENERALLY ACCEPTABLE FORM, THAT REGISTRATION IS NOT REQUIRED UNDER SAID ACT OR (II)
UNLESS 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.
NXU, INC.
Series
B Warrant To Purchase Common Stock
Warrant No.: _________
Number of Warrant Shares: Maximum Eligibility Number (as defined below)
Date of Issuance: December 30, 2024 (“Issuance Date”)
Nxu, Inc., a Delaware corporation (the “Company”),
hereby certifies that, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged,
[HOLDER], 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,
at any time or times on or after the date Stockholder Approval is received and effective until the earlier of the date on which this Warrant
is exercised in full and the Automatic Exercise Date (as defined below), up to a maximum of the Maximum Eligibility Number fully paid
nonassessable shares of Common Stock, subject to adjustment as provided herein (the “Warrant Shares”). Except as otherwise
defined herein, capitalized terms in this Warrant to Purchase shares of Common Stock (including any Warrants to Purchase shares of Common
Stock issued in exchange, transfer or replacement hereof, this “Warrant”), shall have the meanings set forth in Section
17. This Warrant is one of the Series B Warrants to purchase shares of Common Stock (the “SPA Warrants”) issued pursuant
to Section 1 of that certain Securities Purchase Agreement, dated as of December 26, 2024 (the “Subscription Date”),
by and among the Company and the investors (the “Buyers”) referred to therein (the “Securities Purchase Agreement”).
Capitalized terms used herein and not otherwise defined shall have the definitions ascribed to such terms in the Securities Purchase Agreement.
1. EXERCISE OF WARRANT.
(a) Mechanics of Exercise.
Subject to the terms and conditions hereof (including, without limitation, the limitations set forth in Section 1(f)), this Warrant may
be exercised by the Holder, in whole or in part, at any time or times on or after the date Stockholder Approval is received and effective
through the time of the closing of the merger contemplated by the Merger Agreement (as defined below) on the Automatic Exercise Date (such
time on the Automatic Exercise Date, the “Automatic Exercise Time”), in whole or in part, by (i) delivery (whether
via email 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 and (ii) (A) payment to the Company of an amount equal to the applicable Exercise
Price in effect on the date of such exercise multiplied by the number of Warrant Shares as to which this Warrant is being exercised (the
“Aggregate Exercise Price”) in cash by wire transfer of immediately available funds or (B) if the provisions of Section
1(d) are applicable, by notifying the Company in the Exercise Notice that this Warrant is being exercised pursuant to a Cashless Exercise
(as defined in Section 1(d)). Any portion of this Warrant that has not previously been exercised as of the Automatic Exercise Time shall
be automatically exercised as of such Automatic Exercise Time (concurrently with the closing of the merger contemplated by the Merger
Agreement) pursuant to a Cashless Exercise, subject to (i) Stockholder Approval is received and effective through the Automatic Exercise
Date and (ii) the beneficial ownership limitation set forth in Section 1(f) herein. The Holder shall not be required to deliver the original
Warrant in order to effect an exercise hereunder. Execution and delivery of the Exercise Notice with respect to less than all of the Warrant
Shares shall have the same effect as cancellation of the original Warrant and issuance of a new Warrant evidencing the right to purchase
the remaining number of Warrant Shares. On or before the first (1st) Trading Day following the date on which the Company has
received the Exercise Notice, the Company shall transmit by electronic mail an acknowledgment of confirmation of receipt of the Exercise
Notice to the Holder and the Company’s transfer agent (the “Transfer Agent”). On or before the earlier of (i)
the first (1st) Trading Day and (ii) the number of Trading Days comprising the Standard Settlement Period, in each case, following
the date on which the Holder delivers the Exercise Notice to the Company, so long as the Holder delivers the Aggregate Exercise Price
(or notice of a Cashless Exercise) on or prior to the Trading Day following the date on which the Company has received the Exercise Notice
(the “Share Delivery Date”) (provided that if the Aggregate Exercise Price has not been delivered by such date and
the Holder has indicated in the Exercise Notice that the Holder is exercising the Warrant for cash, the Share Delivery Date shall be one
(1) Trading Day after the Aggregate Exercise Price is delivered), the Company shall (X) provided that the Transfer Agent is participating
in The Depository Trust Company (“DTC”) Fast Automated Securities Transfer Program and (A) the Warrant Shares are subject
to an effective resale registration statement in favor of the Holder or (B) if exercised via Cashless Exercise, at a time when Rule 144
would be available for resale of the Warrant Shares by the Holder, credit 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, or (Y) if the Transfer Agent is not participating in the DTC Fast Automated Securities Transfer Program or (A) the
Warrant Shares are not subject to an effective resale registration statement in favor of the Holder or (B) if exercised via Cashless Exercise,
at a time when Rule 144 would not be available for resale of the Warrant Shares by the Holder, deliver to the Holder, book entry statements
evidencing the Warrant Shares, for the number of Warrant Shares to which the Holder is entitled pursuant to such exercise. The Company
shall be responsible for all fees and expenses of the Transfer Agent and all fees and expenses with respect to the issuance of Warrant
Shares via DTC, if any. Upon delivery of the 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 book entry statements 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,
then the Company shall as soon as practicable and in no event later than three (3) Trading Days after any exercise and at its own expense,
issue a new Warrant (in accordance with Section 7(d)) representing the right to purchase the number of Warrant Shares issuable immediately
prior to such exercise under this Warrant, less the number of Warrant Shares with respect to which this Warrant is exercised. No fractional
Warrant Shares or scrip representing fractional shares are to be issued upon the exercise of this Warrant. As to any fraction of a share
to which the Holder would otherwise be entitled to purchase upon exercise, the Company shall, at its election, either pay a cash adjustment
in respect of such final fraction in an amount equal to such fraction multiplied by the Exercise Price or round up to the nearest whole
share. The Company shall pay any and all taxes which may be payable with respect to the issuance and delivery of Warrant Shares upon exercise
of this Warrant. The Company’s obligations to issue and deliver Warrant Shares in accordance with the terms and subject to the conditions
hereof are absolute and unconditional, irrespective of any action or inaction by the Holder to enforce the same, any waiver or consent
with respect to any provision hereof, the recovery of any judgment against any Person or any action to enforce the same, or any setoff,
counterclaim, recoupment, limitation or termination. Notwithstanding any provision of this
Warrant to the contrary, no more than the Maximum Eligibility Number of Warrant Shares shall be exercisable hereunder.
(b) Exercise Price.
For purposes of this Warrant, “Exercise Price” means $0.0001 per share, subject to adjustment as provided herein.
(c) Company’s Failure
to Timely Deliver Securities. Unless such failure is not caused by the Company, if the Company fails for any reason to deliver to
the Holder the Warrant Shares subject to a Notice of Exercise by the Share Delivery Date, the Company shall pay to the Holder, in cash,
as liquidated damages and not as a penalty, for each $1,000 of Warrant Shares subject to such exercise (based on the Weighted Average
Price of the Common Stock on the date of the applicable Notice of Exercise), $10 per Trading Day (increasing to $20 per Trading Day on
the third Trading Day after the Share Delivery Date) for each Trading Day after such Share Delivery Date until such Warrant Shares are
delivered or Holder rescinds such exercise. Additionally, if the Company shall fail (and such failure is not caused by any third party
action or failure to act) to cause the Transfer Agent to transmit to the Holder on or prior to the Share Delivery Date, Warrant Shares
pursuant to an exercise notice delivered by the Holder and if after such date the Holder is required by its broker to purchase (in an
open market transaction or otherwise) or the Holder’s brokerage firm otherwise purchases, shares of Common Stock to deliver in satisfaction
of a sale by the Holder of the Warrant Shares which the Holder anticipated receiving upon such exercise (a “Buy-In”),
then the Company shall, within one (1) Trading Day after the Holder’s request, (a) pay in cash to the Holder the amount, if any,
by which (x) the Holder’s total purchase price (including brokerage commissions, if any) for the shares of Common Stock so purchased
exceeds (y) the amount obtained by multiplying (1) the number of Warrant Shares that the Company was required to deliver to the Holder
in connection with the exercise at issue times (2) the price at which the sell order giving rise to such purchase obligation was executed,
and (b) at the option of the Holder, either reinstate the portion of the Warrant and equivalent number of Warrant Shares for which such
exercise was not honored (in which case such exercise shall be deemed rescinded) or deliver to the Holder the number of shares of Common
Stock that would have been issued had the Company timely complied with its exercise and delivery obligations hereunder. For example, if
the Holder purchases shares of Common Stock having a total purchase price of $11,000 to cover a Buy-In with respect to an attempted exercise
of Common Stock with an aggregate sale price giving rise to such purchase obligation of $10,000, under clause (a) of the immediately preceding
sentence the Company shall be required to pay the Holder $1,000. The Holder shall provide the Company written notice indicating the amounts
payable to the Holder in respect of the Buy-In and evidence of the amount of such loss. 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 shares of Common Stock upon the exercise
of this Warrant as required pursuant to the terms hereof.
(d) Cashless Exercise.
While the Series B Warrants are outstanding, the Company will use its best efforts to maintain the effectiveness of the Registration Statement.
Notwithstanding anything contained herein to the contrary, if the Registration Statement covering the resale of the Warrant Shares is
not available for the resale of such Warrant Shares, 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 Common Stock 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 if such exercise were by means of a cash exercise rather than a Cashless Exercise. |
| B = |
as applicable: (i) the Weighted Average Price of the 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) of Regulation NMS promulgated under the federal securities laws) on such Trading Day, (ii) at the option of the Holder, either (y) the Weighted Average Price on the Trading Day immediately preceding the date of the applicable Exercise Notice or (z) the bid price of the Common Stock on the principal Trading Market as reported by Bloomberg 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 (including until two (2) hours after the close of “regular trading hours” on a Trading Day) pursuant to Section 1(a) hereof or (iii) the Weighted Average 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 pursuant to this
Section 1(d), the Company hereby acknowledges and agrees that, in accordance with Section 3(a)(9) of the 1933 Act, 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. The Company
agrees not to take any position contrary to this Section 1(d).
(e) Disputes. In the
case of a dispute as to the determination of the Exercise Price or the arithmetic calculation of the Warrant Shares, 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 12.
(f) Beneficial Ownership Limitations on Exercises. Notwithstanding
anything to the contrary contained herein, 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 number of 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 the number of 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) and Pre-Funded
Warrants or Series A Warrants (as defined in the Securities Purchase Agreement) 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). For purposes of this
Section 1(f), beneficial ownership shall be calculated in accordance with Section 13(d) of the Securities Exchange Act of 1934, as amended
(the “1934 Act”). For purposes of this Warrant, in 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 Securities and Exchange Commission (the “SEC”), as the case
may be, (y) a more recent public announcement by the Company or (3) any other written notice by the Company or the Transfer Agent 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), to exceed the Maximum Percentage, the Holder must notify the Company of a reduced number of Warrant Shares to be purchased 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 request of the Holder, the Company shall within one (1) Trading Day confirm 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 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-1(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) 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) 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) Insufficient Authorized Shares. If at any time while this
Warrant remains 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 exercise of this Warrant at least a number of shares of Common Stock equal to 100% of the
number of shares of Common Stock as shall from time to time be necessary to effect the exercise of all of this Warrant then outstanding
without regard to any limitation on exercise included herein and assuming that the Maximum Eligibility Number is being determined based
on a Reset Price equal to $0.0524 (as adjusted for stock splits, stock dividends, recapitalizations, reorganizations, reclassification,
combinations, reverse stock splits, or other similar events occurring after the Subscription Date) (the “Required Reserve Amount”
and the failure to have such sufficient number of authorized and unreserved shares of Common Stock, 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 this Warrant then outstanding. Without limiting the generality
of the foregoing sentence, if shareholder approval is required to cure an Authorized Share Failure, 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 shareholders 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 shareholder with a proxy statement and shall use its best efforts
to solicit its shareholders’ approval of such increase in authorized shares of Common Stock and to cause its board of directors
to recommend to the shareholders that they approve such proposal. Notwithstanding the foregoing, if any such time of an Authorized Share
Failure, the Company is able to obtain the approval of holders of a majority of the shares of Common Stock voting at a general meeting
to approve the increase in the number of authorized shares of Common Stock, the Company may satisfy this obligation by obtaining such
approval.
(h) Stockholder Approval.
The Company shall file with the SEC a preliminary proxy statement within ten (10) Business Days of the Closing Date and shall use its
commercially reasonable efforts to hold a special meeting of stockholders on or prior to forty-five (45) days after the Closing Date (as
defined in the Securities Purchase Agreement), for the purpose of obtaining the Stockholder Approval, with the recommendation of the Company’s
Board of Directors that such proposal be approved, and the Company shall solicit proxies from its stockholders in connection therewith
in the same manner as all other management proposals in such proxy statement and all management-appointed proxyholders shall vote their
proxies in favor of such proposal. The Company shall use its commercially reasonable efforts to obtain such Stockholder Approval. If the
Company does not obtain Stockholder Approval at the first meeting, the Company shall call a meeting every ninety (90) days thereafter
to seek Stockholder Approval until the earlier of the date on which Stockholder Approval is obtained or the Warrants are no longer outstanding.
2. ADJUSTMENT OF EXERCISE
PRICE AND NUMBER OF WARRANT SHARES. The Exercise Price and the number of Warrant Shares shall be adjusted from time to time as follows:
(a) Maximum Eligibility
Number Reset.
(i) The Maximum Eligibility
Number shall be increased (but not decreased) on the Reset Date to equal the Reset Share Amount.
(ii) Notwithstanding the foregoing,
if a Holder requests to exercise this Warrant in whole or in part on any given date during the Reset Period but prior to the Reset Date,
solely with respect to such portion of this Warrant being exercised on such applicable date (the “Exercise Date”),
(a) such applicable Reset Date shall be deemed to mean the Exercise Date, (b) such applicable Reset Period shall be deemed to have ended
on the Trading Day immediately prior to the Exercise Date, and (c) the applicable Reset Price and Reset Share Amount for such exercised
Warrants shall be calculated pursuant to this Section 2(a). For the avoidance of doubt, following the calculation of the Reset Price and
Reset Share Amount pursuant to this Section 2(a)(ii), the Company’s obligations with regard to such exercised Warrants shall be
deemed satisfied and no additional Reset Price and Reset Share Amount shall apply to such exercised Warrants.
(b) Adjustment Upon Subdivision
or Combination of Common Stock. If the Company at any time on or after the Subscription Date subdivides (by any share split, share
dividend, recapitalization or otherwise) one or more classes of its outstanding Common Stock into a greater number of shares, the Exercise
Price in effect immediately prior to such subdivision will be proportionately reduced and the number of Warrant Shares will be proportionately
increased. If the Company at any time on or after the Subscription Date combines (by combination, reverse share split or otherwise) one
or more classes of its outstanding Common Stock into a smaller number of shares, the Exercise Price in effect immediately prior to such
combination will be proportionately increased and the number of Warrant Shares will be proportionately decreased. Any adjustment under
this Section 2(b) shall become effective at the close of business on the date the subdivision or combination becomes effective.
(c) Partial Reset.
If less than all of the Registrable Securities have been registered pursuant to the clause (i) of the definition of Reset Date and a Holder
has deemed the condition satisfied as to such Registrable Securities, then the Reset Date shall apply only to such portion of the Registrable
Securities, and the Company’s obligations will continue to apply with regard to the Registrable Securities for which the definition
of Reset Date has not been not satisfied.
3. RIGHTS UPON DISTRIBUTION
OF ASSETS. 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 Ordinary Shares 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 of which a record is taken for such Distribution, or, if no such record is taken, the date as
of which the record holders of Ordinary Shares 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 such extent (and
shall not be entitled to beneficial ownership of such Ordinary Shares as a result of such Distribution (and beneficial ownership) to such
extent) and the portion of such Distribution shall be held in abeyance for the benefit of the Holder until such time or times as its right
thereto would not result in the Holder and the other Attribution Parties exceeding the Maximum Percentage, at which time or times the
Holder shall be granted such Distribution (and any Distributions declared or made on such initial Distribution or on any subsequent Distribution
held similarly in abeyance) to the same extent as if there had been no such limitation).
4. PURCHASE RIGHTS; TRANSACTIONS.
(a) Purchase Rights.
In addition to any adjustments pursuant to Section 2 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, issue or sale of such Purchase Rights (provided, however, that to the extent that the Holder’s right to participate
in any such Purchase Right would result in the Holder and the other Attribution Parties exceeding the Maximum Percentage, then the Holder
shall not be entitled to participate in such Purchase Right to such extent (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) and such Purchase Right to such extent
shall be held in abeyance for the benefit of the Holder until such time or times 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 the Successor Entity assumes in
writing all of the obligations of the Company under this Warrant and the other Transaction Documents in accordance with the
provisions of this Section 4(b) pursuant to written agreements in form and substance satisfactory to the Required Holders, including
agreements, if so requested by the Holder, to deliver to each holder of the SPA Warrants in exchange for such SPA Warrants a
security of the Successor Entity evidenced by a written instrument substantially similar in form and substance to this Warrant,
including, without limitation, an adjusted exercise price equal to the value for the Common Stock reflected by the terms of such
Fundamental Transaction, and exercisable for a corresponding number of shares of capital stock equivalent to the 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 satisfactory to the Required Holders, 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 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 occurrence or
consummation of such Fundamental Transaction). Any security issuable or potentially issuable to the Holder pursuant to the terms of
this Warrant on the consummation of a Fundamental Transaction that was within the Company’s control to enter into or to avoid
shall be registered and freely tradable by the Holder without any restriction or limitation or the requirement to be subject to any
holding period pursuant to any applicable securities laws. No later than (i) thirty (30) days
prior to the occurrence or consummation of any Fundamental Transaction or (ii) if later, the first Trading Day following the date
the Company first becomes aware of the occurrence or potential occurrence of a Fundamental Transaction, the Company shall deliver
written notice thereof via facsimile or electronic mail and overnight courier to the Holder. Upon the occurrence or consummation of
any Fundamental Transaction that was within the Company’s control to enter into or to avoid, it shall be a required condition
to the occurrence or consummation of any Fundamental Transaction that, the Company and the Successor Entity or Successor Entities,
jointly and severally, shall succeed to, and the Company shall cause any Successor Entity or Successor Entities to jointly and
severally succeed to, and be added to the term “Company” under this Warrant (so that from and after the date of such
Fundamental Transaction, each and every provision of this Warrant referring to the “Company” shall refer instead to each
of the Company and the Successor Entity or Successor Entities, jointly and severally), and the Company and the Successor Entity or
Successor Entities, jointly and severally, may exercise every right and power of the Company prior thereto and shall assume all of
the obligations of the Company prior thereto under this Warrant with the same effect as if the Company and such Successor Entity or
Successor Entities, jointly and severally, had been named as the Company in this Warrant, and, solely at the request of the Holder,
if the Successor Entity and/or Successor Entities is a publicly traded corporation whose common stock is quoted on or listed for
trading on an Eligible Market, shall deliver (in addition to and without limiting any right under this Warrant) to the Holder in
exchange for this Warrant a security of the Successor Entity and/or Successor Entities evidenced by a written instrument
substantially similar in form and substance to this Warrant and exercisable for a corresponding number of shares of capital stock of
the Successor Entity and/or Successor Entities (the “Successor 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 (such corresponding number of shares of Successor Capital Stock to be delivered to the Holder
shall be equal to the greater of (A) the quotient of (i) the aggregate dollar value of all consideration (including cash
consideration and any consideration other than cash (“Non-Cash Consideration”), in such Fundamental Transaction,
as such values are set forth in any definitive agreement for the Fundamental Transaction that has been executed at the time of the
first public announcement of the Fundamental Transaction or, if no such value is determinable from such definitive agreement, as
determined in accordance with Section 12 with the term “Non-Cash Consideration” being substituted for the term
“Exercise Price”) that the Holder would have been entitled to receive upon the happening of such Fundamental Transaction
or the record, eligibility or other determination date for the event resulting in such Fundamental Transaction, had this Warrant
been exercised immediately prior to such Fundamental Transaction or the record, eligibility or other determination date for the
event resulting in such Fundamental Transaction (without regard to any limitations on the exercise of this Warrant) (the
“Aggregate Consideration”) divided by (ii) the per share Closing Sale Price of such Successor Capital Stock on
the Trading Day immediately prior to the consummation or occurrence of the Fundamental Transaction and (B) the product of (i) the
quotient obtained by dividing (x) the Aggregate Consideration, by (y) the Closing Sale Price of the Common Stock on the Trading Day
immediately prior to the consummation or occurrence of the Fundamental Transaction and (ii) the highest exchange ratio pursuant to
which any shareholder of the Company may exchange shares of Common Stock for Successor Capital Stock) (provided, however,
to the extent that the Holder’s right to receive any such shares of publicly traded common stock (or their equivalent) of the
Successor Entity would result in the Holder and its other Attribution Parties exceeding the Maximum Percentage, if applicable, then
the Holder shall not be entitled to receive such shares to such extent (and shall not be entitled to beneficial ownership of such
shares of publicly traded common stock (or their equivalent) of the Successor Entity as a result of such consideration to such
extent) and the portion of such shares shall be held in abeyance for the Holder until such time or times, as its right thereto would
not result in the Holder and its other Attribution Parties exceeding the Maximum Percentage, at which time or times the Holder shall
be delivered such shares to the extent as if there had been no such limitation), and such security shall be satisfactory to the
Holder, and with an identical exercise price to the Exercise Price hereunder (such adjustments to the number of shares of capital
stock and such exercise price being for the purpose of protecting after the consummation or occurrence of such Fundamental
Transaction the economic value of this Warrant that was in effect immediately prior to the consummation or occurrence of such
Fundamental Transaction, as elected by the Holder solely at its option). Upon occurrence or consummation of the Fundamental
Transaction, and it shall be a required condition to the occurrence or consummation of such Fundamental Transaction that, the
Company and the Successor Entity or Successor Entities shall deliver to the Holder confirmation that there shall be issued upon
exercise of this Warrant at any time after the occurrence or consummation of the Fundamental Transaction, as elected by the Holder
solely at its option, Common Stock, Successor Capital Stock or, in lieu of the Common Stock or Successor Capital Stock (or other
securities, cash, assets or other property purchasable upon the exercise of this 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 for purposes of clarification may continue to be Common Stock, if any, that the Holder would have been
entitled to receive upon the happening of such Fundamental Transaction or the record, eligibility or other determination date for
the event resulting in such Fundamental Transaction, had this Warrant been exercised immediately prior to such Fundamental
Transaction or the record, eligibility or other determination date for the event resulting in such Fundamental Transaction (without
regard to any limitations on the exercise of this Warrant), as adjusted in accordance with the provisions of this Warrant. In
addition to and not in substitution for any other rights hereunder, prior to the occurrence or consummation of any Fundamental
Transaction pursuant to which holders of shares of Common Stock are entitled to receive securities, cash, assets or other property
with respect to or in exchange for Common Stock (a “Corporate Event”), the Company shall make appropriate
provision to ensure that, and any applicable Successor Entity or Successor Entities shall ensure that, and it shall be a required
condition to the occurrence or consummation of such Corporate Event that, the Holder will thereafter have the right to receive upon
exercise of this Warrant at any time after the occurrence or consummation of the Corporate Event, Common Stock or Successor Capital
Stock or, if so elected by the Holder, in lieu of the Common Stock (or other securities, cash, assets or other property) purchasable
upon the exercise of this Warrant prior to such Corporate Event (but not in lieu of such items still issuable under Sections 3 and
4(a), which shall continue to be receivable on the Common Stock or on the such shares of stock, securities, cash, assets or any
other property otherwise receivable with respect to or in exchange for Common Stock), such shares of stock, securities, cash, assets
or any other property whatsoever (including warrants or other purchase or subscription rights and any Common Stock) which the Holder
would have been entitled to receive upon the occurrence or consummation of such Corporate Event or the record, eligibility or other
determination date for the event resulting in such Corporate Event, had this Warrant been exercised immediately prior to such
Corporate Event or the record, eligibility or other determination date for the event resulting in such Corporate Event (without
regard to any limitations on exercise of this Warrant). Provision made pursuant to the preceding sentence shall be in a form and
substance reasonably satisfactory to the Holder. The provisions of this Section 4(b) shall apply similarly and equally to successive
Fundamental Transactions and Corporate Events.
5. NON-CIRCUMVENTION.
The Company hereby covenants and agrees that the Company will not, by amendment of its Certificate of Incorporation, as amended and restated,
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 Warrant, and will at all
times in good faith carry out all of 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 (i) shall not increase the par value of any Common Stock receivable
upon the exercise of this Warrant above the Exercise Price then in effect, (ii) shall take all such actions as may be necessary or appropriate
in order that the Company may validly and legally issue fully paid and nonassessable shares of Common Stock upon the exercise of this
Warrant, and (iii) shall, so long as any of the SPA Warrants 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 exercise of the SPA Warrants, 100%
of the number of shares of Common Stock as shall from time to time be necessary to effect the exercise of the SPA Warrants then outstanding
(without regard to any limitations on exercise and assuming that the Maximum Eligibility Number is being determined based on a Reset Price
equal to $0.0524 (as adjusted for forward share splits, stock dividends, recapitalizations, reorganizations, reclassification, combinations,
reverse share splits, or other similar events occurring after the Subscription Date).
6. WARRANT HOLDER NOT DEEMED
A SHAREHOLDER. Except as otherwise specifically provided herein, the Holder, solely in such Person’s 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 such Person’s capacity as the Holder
of this Warrant, any of the rights of a shareholder 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 such
Person 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 shareholder
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 shareholders of the Company generally,
contemporaneously with the giving thereof to the shareholders.
7. REISSUANCE OF WARRANTS.
(a) Transfer of
Warrant. If this Warrant is to be transferred, the Holder shall surrender this Warrant to the Company, whereupon the Company
will forthwith issue and deliver upon the order of the Holder a new Warrant (in accordance with Section 7(d)), registered as the
Holder may request, representing the right to purchase the number of Warrant Shares being transferred by the Holder and, if less
than the total number of Warrant Shares then underlying this Warrant is being transferred, a new Warrant (in accordance with Section
7(d)) to the Holder representing the right to purchase the number of Warrant Shares not being transferred.
(b) Lost, Stolen or Mutilated
Warrant. Upon receipt by the Company of evidence reasonably satisfactory to the Company of the loss, theft, destruction or mutilation
of this Warrant, and, in the case of loss, theft or destruction, of any indemnification undertaking by the Holder to the Company in customary
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, that no SPA Warrants for fractional Warrant Shares
shall be given.
(d) Issuance of New Warrants.
Whenever the Company is required to issue a new Warrant pursuant to the terms of this Warrant, such new Warrant (i) shall be of like tenor
with this Warrant, (ii) shall represent, as indicated on the face of such new Warrant, the right to purchase the Warrant Shares then underlying
this Warrant (or in the case of a new Warrant being issued pursuant to Section 7(a) or Section 7(c), the Warrant Shares designated by
the Holder which, when added to the number of shares of Common Stock underlying the other new Warrants issued in connection with such
issuance, does not exceed the number of Warrant Shares then underlying this Warrant), (iii) shall have an issuance date, as indicated
on the face of such new Warrant which is the same as the Issuance Date, and (iv) shall have the same rights and conditions as this Warrant.
8. NOTICES. Whenever
notice is required to be given under this Warrant, unless otherwise provided herein, such notice shall be given in accordance with Section
9(f) of the Securities Purchase Agreement. The Company shall provide the Holder with prompt written notice of all actions taken pursuant
to this Warrant, 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 any adjustment of the Exercise 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, (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. It is expressly understood and agreed that the time of exercise specified by the Holder
in each Exercise Notice shall be definitive and may not be disputed or challenged by the Company.
9. AMENDMENT AND WAIVER.
Except as otherwise provided herein, the provisions of this Warrant may be amended or waived 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.
10. GOVERNING LAW; JURISDICTION;
JURY TRIAL. 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 choice of law or conflict of law provision or rule (whether of the State of New York or any other jurisdictions) that would
cause the application of the laws of any jurisdictions other than the State of New York. The Company hereby irrevocably submits to the
exclusive jurisdiction of the state and federal courts sitting in The City of New York, Borough of Manhattan, for the adjudication of
any dispute hereunder or in connection herewith or with any transaction contemplated hereby or discussed herein, and hereby irrevocably
waives, and agrees not to assert in any suit, action or proceeding, any claim that it is not personally subject to the jurisdiction of
any such court, that such suit, action or proceeding is brought in an inconvenient forum or that the venue of such suit, action or proceeding
is improper. The Company hereby irrevocably waives personal service of process and consents to process being served in any such suit,
action or proceeding by mailing a copy thereof to the Company at the address set forth 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. 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, 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.
11. CONSTRUCTION; HEADINGS.
This Warrant shall be deemed to be jointly drafted by the Company and all the Buyers 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.
12. DISPUTE
RESOLUTION. In the case of a dispute as to the determination of the Exercise Price or the arithmetic calculation of the Warrant
Shares, the Company shall submit the disputed determinations or arithmetic calculations via facsimile or electronic mail within two
(2) Business Days of receipt of the Exercise Notice giving rise to such dispute, as the case may be, to the Holder. If the Holder
and the Company are unable to agree upon such determination or calculation of the Exercise Price or the Warrant Shares within three
(3) Business Days of such disputed determination or arithmetic calculation being submitted to the Holder, then the Company shall,
within two (2) Business Days submit via facsimile or electronic mail (a) the disputed determination of the Exercise Price to an
independent, reputable investment bank selected by the Company and approved by the Holder or (b) the disputed arithmetic calculation
of the Warrant Shares to the Company’s independent, outside accountant. The Company shall cause at its expense the investment
bank or the accountant, as the case may be, to perform the determinations or calculations and notify the Company and the Holder of
the results no later than ten (10) Business Days from the time it receives the disputed determinations or calculations. Such
investment bank’s or accountant’s determination or calculation, as the case may be, shall be binding upon all parties
absent demonstrable error.
13. REMEDIES, 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 damages for any failure by the Company to comply with
the terms of this Warrant. 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 an injunction restraining
any breach, without the necessity of showing economic loss and without any bond or other security being required.
14. TRANSFER. This Warrant
and the Warrant Shares may be offered for sale, sold, transferred, pledged or assigned without the consent of the Company, except as may
otherwise be required by Section 2(f) of the Securities Purchase Agreement.
15. 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).
16. DISCLOSURE.
Upon receipt or delivery by the Company 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, nonpublic information relating to the Company
or its Subsidiaries (as defined in the Securities Purchase Agreement), the Company shall contemporaneously with any such receipt or
delivery publicly disclose such material, nonpublic information on a Current Report on Form 8-K or otherwise. In the event that the
Company believes that a notice contains material, nonpublic information relating to the Company or its Subsidiaries, the Company so
shall indicate to the Holder contemporaneously with delivery of such notice, and in the absence of any such indication, the Holder
shall be allowed to presume that all matters relating to such notice do not constitute material, nonpublic information relating to
the Company or its Subsidiaries.
17. 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.
(b) “Affiliate”
shall have the meaning ascribed to such term in Rule 405 of the 1933 Act.
(c) “Approved Stock
Plan” means any employee benefit plan or share incentive plan which has been approved by the Board of Directors of the Company,
pursuant to which the Company’s securities may be issued to any employee, officer or director for services provided to the Company.
(d) “Attribution
Parties” means, collectively, the following Persons: (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 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.
(e) “Automatic Exercise
Date” means the date of the closing of the merger contemplated under the Agreement and Plan of Merger, dated as of October 23,
2024, by and among the Company, NXU Merger Sub, Inc., a Delaware corporation, NXU Merger Sub, LLC, a Delaware limited liability company,
and Verde Bioresins, Inc., a Delaware corporation (the “Merger Agreement”).
(f) “Bloomberg”
means Bloomberg Financial Markets.
(g) “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.
(h) “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 the 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 on the Pink Open Market. 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
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
pursuant to Section 12. All such determinations to be appropriately adjusted for any stock dividend, stock split, stock combination, reclassification
or other similar transaction during the applicable calculation period.
(i) “Closing Date”
shall have the meaning ascribed to such term in the Securities Purchase Agreement.
(j) “Common Stock”
means (i) the Company’s shares of Common Stock, par value $0.0001 per share, and (ii) any share capital into which such shares of
Common Stock shall have been changed or any share capital resulting from a reclassification, reorganization or reclassification of such
Common Stock.
(k) “Convertible
Securities” means any stock or securities (other than Options) directly or indirectly convertible into or exercisable or exchangeable
for shares of Common Stock.
(l) “Eligible Market”
means the Principal Market, the NYSE American, The Nasdaq Global Select Market, The Nasdaq Global Market, The New York Stock Exchange,
Inc., the OTC QB or the OTC QX.
(m) “Floor Price” means $0.0524, (as adjusted for
stock splits, stock dividends, recapitalizations, reorganizations, reclassification, combinations, reverse stock splits or other similar
events occurring after the Subscription Date).
(n) “Fundamental
Transaction” means (A) that, except as contemplated under the Merger Agreement, 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 (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 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, except as contemplated under the Merger Agreement, 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 shares of Common Stock, (y) at least 50% of the aggregate ordinary voting power represented
by issued and outstanding shares of Common Stock not held by all such Subject Entities as of the Subscription Date calculated as if any
shares of Common Stock held by all such Subject Entities were not outstanding, or (z) a percentage of the aggregate ordinary voting power
represented by issued and outstanding shares of Common Stock or other equity securities of the Company sufficient to allow such Subject
Entities to effect a statutory short form merger or other transaction requiring other shareholders of the Company to surrender their shares
of Common Stock without approval of the shareholders of the Company or (C) except as contemplated under the Merger Agreement, 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.
(o) “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.
(p) “Maximum Eligibility
Number” means initially zero (0) and such number shall be increased (but not decreased) on the Reset Date in accordance with
Section 2(a), subject to any exercise pursuant to Section 2(c).
(q) “Options”
means any rights, warrants or options to subscribe for or purchase (i) shares of Common Stock or (ii) Convertible Securities.
(r) “Parent Entity”
of a Person means an entity that, directly or indirectly, controls the applicable Person, including such entity whose common capital or
equivalent equity security is quoted or listed on an Eligible Market (or, if so elected by the Required Holders, any other market, exchange
or quotation system), or, if there is more than one such Person or such entity, the Person or such entity designated by the Required Holders
or in the absence of such designation, such Person or entity with the largest public market capitalization as of the date of consummation
of the Fundamental Transaction.
(s) “Person”
means an individual, a limited liability company, a partnership, a joint venture, a corporation, a trust, an unincorporated organization,
any other entity and a government or any department or agency thereof.
(t) “Pre-Funded Warrants”
shall have the meaning ascribed to such term in the Securities Purchase Agreement.
(u) “Principal Market”
means The Nasdaq Capital Market.
(v) “Public Information
Failure” shall mean any time that the Company shall fail to satisfy any condition set forth in Rule 144(i)(2).
(w) “Purchase Price”
shall have the meaning ascribed to such term in the Securities Purchase Agreement.
(x) “Purchased Shares”
shall have the meaning ascribed to such term in the Securities Purchase Agreement.
(y) “Registrable
Securities” shall have the meaning ascribed to such term in the Registration Rights Agreement.
(z) “Registration
Rights Agreement” means that certain Registration Rights Agreement dated as of the Subscription Date by and among the Company
and the Buyers.
(aa) “Registration
Statement” means a registration statement meeting the requirements set forth in the Registration Rights Agreement and covering
the resale by the Buyers of the Registrable Securities (as defined in the Registration Rights Agreement).
(bb) “Required Holders”
means the holders of the SPA Warrants representing at least a majority of the shares of Common Stock underlying the SPA Warrants then
outstanding.
(cc) “Reset Date”
means (A) the date that is the eighth (8th) Trading Day after the date on which all or a portion of the Registrable Securities
have become registered pursuant to an effective Registration Statement that is available for the resale of all Registrable Securities,
provided, if less than all Registrable Securities have become registered for resale on the date that a Registration Statement is
declared effective, the Holder with respect to itself only, shall have the right in its sole and absolute discretion to deem such condition
satisfied, including with regard only to the Registrable Securities that have been so registered or (B) the first (1st) Trading
Day after the date on which the Holder, for eight (8) consecutive Trading Days, can sell all Registrable Securities pursuant to Rule 144
without restriction or limitation and the Company has not had a Public Information Failure. In the event that the Stockholder Approval
has not been obtained and effective prior to either of the time periods in clauses (A) or (B) in the immediately preceding sentence, “Reset
Date” means the eighth (8th) Trading Day after the Stockholder Approval has been received and effective.
(dd) “Reset Period”
means the period commencing on the first (1st) Trading Day after the Registration Statement is declared effective by the SEC
and ending on the eighth (8th) Trading Day thereafter or, in the event the Stockholder Approval has not been obtained and effective
prior to either of the time periods in clauses (A) or (B) in the definition of Reset Period above, “Reset Period” means the
period commencing on the first (1st) Trading Day after the Stockholder Approval is received and deemed effective and ending
on the eighth (8th) Trading Day thereafter.
(ee) “Reset Price”
means the greater of (i) 80% of the lowest daily Weighted Average Price during the Reset Period and (ii) the Floor Price (as adjusted
for stock splits, stock dividends, recapitalizations, reorganizations, reclassification, combinations, reverse stock splits or other similar
events occurring after the Subscription Date).
(ff) “Reset
Share Amount” means the number of shares of Common Stock equal to the number (if positive)
obtained by subtracting (I) the number of Purchased Shares purchased by the Holder on the Closing Date pursuant to the Securities Purchase
Agreement (as adjusted for share splits, dividends, recapitalizations, reorganizations, reclassification, combinations, reverse share
splits or other similar events occurring after the Subscription Date) from (II) the quotient determined by dividing (x) the aggregate
Purchase Price paid by the Holder on the Closing Date by (y) the applicable Reset Price determined as of the Reset Date.
(gg) “Series A Warrants”
shall have the meaning ascribed to such term in the Securities Purchase Agreement.
(hh) “Standard
Settlement Period” means the standard settlement period, expressed in a number of Trading Days, on the Company’s primary
Eligible Market with respect to the shares of Common Stock as in effect on the date of delivery of the applicable Exercise Notice.
(ii) “Stockholder
Approval” means such approval as may be required by the applicable rules and regulations of The Nasdaq Stock Market LLC (or
any successor entity) from the stockholders of the Company, or board of directors in lieu thereof, with respect to issuance of all of
the Warrants and the Warrant Shares upon the exercise hereof.
(jj) “Subject Entity”
means any Person, Persons or Group or any Affiliate or associate of any such Person, Persons or Group.
(kk) “Successor Entity”
means one or more Person or Persons (or, if so elected by the Holder, the Company or Parent Entity) formed by, resulting from or surviving
any Fundamental Transaction or one or more Person or Persons (or, if so elected by the Holder, the Company or the Parent Entity) with
which such Fundamental Transaction shall have been entered into.
(ll) “Trading Day”
means 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 on such day, then on the principal securities exchange or securities market on which the Common Stock is then traded.
(mm) “Weighted Average
Price” means, for any security as of any date, the dollar volume-weighted average price for such security on the Principal Market
during the period beginning at 9:30:01 a.m., New York time (or such other time as the Principal Market publicly announces is the official
open of trading), and ending at 4:00:00 p.m., New York time (or such other time as the Principal Market publicly announces is the official
close of trading), as reported by Bloomberg through its “Volume at Price” function 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 9:30:01 a.m., New York time (or such other time as such market publicly announces is the official open
of trading), and ending at 4:00:00 p.m., New York time (or such other time as such market publicly announces is the official close of
trading), 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 on the Pink Open Market. If the Weighted Average Price cannot be calculated for a security on a particular date on any of the
foregoing bases, the Weighted Average 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 pursuant to Section 12 with the term “Weighted Average Price” being substituted for the term “Exercise
Price.” All such determinations shall be appropriately adjusted for any stock dividend, stock split, stock combination, reclassification
or other similar transaction during the applicable calculation 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.
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NXU, INC. |
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EXHIBIT A
EXERCISE NOTICE
TO BE EXECUTED BY THE REGISTERED HOLDER TO EXERCISE
THIS
WARRANT TO PURCHASE COMMON STOCK
NXU, INC.
The undersigned holder hereby
exercises the right to purchase _________________ shares of Common Stock (“Warrant Shares”) of NXU, INC., a Delaware
corporation (the “Company”), evidenced by the attached Warrant to Purchase Common Stock (the “Warrant”).
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 Exercise Price shall be made as:
____________ a “Cash
Exercise” with respect to _________________ Warrant Shares; and/or
____________ a “Cashless
Exercise” with respect to _______________ Warrant Shares, resulting in a delivery obligation of the Company to the Holder of
__________ shares of Common Stock representing the applicable Net Number.
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 the holder __________ Warrant Shares in accordance with the terms of the Warrant.
Date: _______________ __, ______
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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 ________
__, 2024 from the Company and acknowledged and agreed to by [_____].
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NXU, INC. |
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Exhibit 10.1
SECURITIES
PURCHASE AGREEMENT
SECURITIES
PURCHASE AGREEMENT (this “Agreement”), dated as of December 26, 2024, is by and among Nxu, Inc., a Delaware corporation
(the “Company”), and each of the investors listed on the Schedule of Buyers attached hereto (individually, a “Buyer”
and collectively, the “Buyers”).
WHEREAS:
A.
The Company and each Buyer is executing and delivering this Agreement in reliance upon the exemption from securities registration afforded
by Section 4(a)(2) of the Securities Act of 1933, as amended (the “1933 Act”), and Rule 506(b) of Regulation D (“Regulation
D”) as promulgated by the United States Securities and Exchange Commission (the “SEC”) under the 1933 Act.
B.
Each Buyer wishes to purchase from the Company, and the Company wishes to issue and sell to each Buyer, upon the terms and conditions
stated in this Agreement, an aggregate number of units consisting of: (i) the aggregate number of the Company’s Class A common
stock, par value $0.0001 per share (the “Common Stock”), set forth opposite such Buyer’s name in column (3)
on the Schedule of Buyers (which shall collectively be referred to herein as the “Purchased Shares”) and/or pre-funded
warrants, in substantially the form attached hereto as Exhibit A (the “Pre-Funded Warrants”), to purchase initially
up to that number of shares of Common Stock set forth opposite such Buyer’s name in column (4) on the Schedule of Buyers (the shares
of Common Stock underlying the Pre-Funded Warrants, collectively, the “Pre-Funded Warrant Shares”) at an exercise
price equal to $0.0001 per each Pre-Funded Warrant Share, (ii) warrants, in substantially the form attached hereto as Exhibit B
(the “Series A Warrants”), to purchase initially up to that number of shares of Common Stock set forth opposite such
Buyer’s name in column (5) on the Schedule of Buyers (the shares of Common Stock underlying the Series A Warrants, collectively,
the “Series A Warrant Shares”) at an exercise price equal to $0.50 per each Series A Warrant Share, and (iii) warrants,
in substantially the form attached hereto as Exhibit C (the “Series B Warrants” and, together with the Pre-Funded
Warrants and Series A Warrants, the “Warrants”), to purchase initially up to that number of shares of Common Stock
set forth therein and exercisable in accordance with its terms and conditions (the shares of Common Stock underlying the Series B Warrants,
collectively, the “Series B Warrant Shares” and, together with the Pre-Funded Warrant Shares and Series A Warrant
Shares, the “Warrant Shares”) at an exercise price equal to $0.0001 per Series B Warrant Share. The Purchased Shares,
the Warrants and the Warrant Shares are collectively referred to herein as the “Securities.”
C.
Contemporaneously with the execution and delivery of this Agreement, the parties hereto are executing and delivering a Registration Rights
Agreement, in substantially the form attached hereto as Exhibit D (the “Registration Rights Agreement”), pursuant
to which the Company has agreed to provide certain registration rights with respect to the Registrable Securities (as defined in the
Registration Rights Agreement) under the 1933 Act and the rules and regulations promulgated thereunder, and applicable state securities
laws.
NOW,
THEREFORE, in consideration of the foregoing and of the agreements and covenants herein contained, and for other good and valuable
consideration, the receipt and sufficiency of which is hereby acknowledged, the Company and each Buyer hereby agree as follows:
1.
PURCHASE AND SALE OF SECURITIES.
(a)
Purchase of Purchased Shares and Warrants. Subject to the satisfaction (or waiver) of the conditions set forth in Sections 6 and
7 below, the Company shall issue and sell to each Buyer, and each Buyer severally, but not jointly, agrees to purchase from the Company
on the Closing Date (as defined below), (x) the number of Purchased Shares and/or Pre-Funded Warrants as is set forth opposite such Buyer’s
name in column (3) and column (4) on the Schedule of Buyers, along with (y) Series A Warrants to acquire up to that number of Series
A Warrant Shares as is set forth opposite such Buyer’s name in column (5) on the Schedule of Buyers, and (z) Series B Warrants
to acquire Series B Warrant Shares in accordance with its terms and conditions (the “Closing”). Notwithstanding anything
herein to the contrary, in no event will any Buyer’s voting rights in the Company or ownership of the Company’s issued share
capital exceed 4.99% of the number of shares of Common Stock outstanding immediately after giving effect to the issuance of the Securities
on the Closing Date.
(b)
Closing. The date and time of the Closing (the “Closing Date”) shall take place remotely via the exchange of
documents and signatures, on the date hereof (or such other date and time as is mutually agreed to by the Company and each Buyer) after
notification of satisfaction (or waiver) of the conditions to the Closing set forth in Sections 6 and 7 below.
(c)
Purchase Price. The purchase price for the Purchased Shares and the related Warrants to be purchased by each Buyer at the Closing
shall be the amount set forth opposite such Buyer’s name in column (6) of the Schedule of Buyers (the “Purchase Price”),
which shall be equal to the amount of $0.25 per Purchased Share and related Series A Warrants and Series B Warrants and equal to the
amount of $0.2499 per Pre-Funded Warrant and related Series A Warrants and Series B Warrants.
(d)
Form of Payment. On the Closing Date, (i) each Buyer shall pay its respective Purchase Price by wire transfer to the account specified
in the escrow agreement (the “Escrow Agreement”) entered into prior to the Closing Date by and among the Company,
the Escrow Agent (as defined below) and the Placement Agent, in which Ellenoff Grossman & Schole LLP will act as “Escrow Agent”;
and (ii) the Company shall deliver to each Buyer (w) book- entry statements, evidencing the number of Purchased Shares such Buyer is
purchasing as is set forth opposite such Buyer’s name in column (3) of the Schedule of Buyers, (x) if applicable, a Pre-Funded
Warrant initially exercisable for such number of Pre-Funded Warrant Shares as is set forth opposite such Buyer’s name in column
(4) of the Schedule of Buyers, (y) a Series A Warrant initially exercisable for such number of Series A Warrant Shares as is set forth
opposite such Buyer’s name in column (5) of the Schedule of Buyers, and (z) a Series B Warrant pursuant to which such Buyer shall
have the right to purchase Series B Warrant Shares in accordance with its terms and conditions, in each case duly executed on behalf
of the Company and registered in the name of such Buyer or its designee.
2.
BUYER’S REPRESENTATIONS AND WARRANTIES. Each Buyer, severally and not jointly, represents and warrants with respect to only
itself to the Company that:
(a)
No Public Sale or Distribution. Such Buyer is (i) acquiring the Securities and (ii) upon exercise of the Warrants (other than
pursuant to a Cashless Exercise (as defined in the Warrants)) will acquire the Warrant Shares issuable upon exercise of the Warrants,
for its own account and not with a view towards, or for resale in connection with, the public sale or distribution thereof in violation
of applicable securities laws, except pursuant to sales registered or exempted under the 1933 Act, and has no direct or indirect arrangement
or understandings with any other Persons to distribute or regarding the distribution of such Securities; provided, however,
that by making the representations herein, such Buyer does not agree, or make any representation or warranty, to hold any of the Securities
for any minimum or other specific term and reserves the right to dispose of the Securities at any time in accordance with or pursuant
to a registration statement or an exemption under the 1933 Act. Such Buyer does not presently have any agreement or understanding, directly
or indirectly, with any Person to distribute any of the Securities in violation of applicable securities laws. Such Buyer is acquiring
the Securities hereunder in the ordinary course of its business. As used herein, “Person” means an individual, a limited
liability company, a partnership, a joint venture, a corporation, a trust, an unincorporated organization, any other entity and any governmental
entity or any department or agency thereof.
(b)
Accredited Investor Status. Such Buyer is an “accredited investor” as that term is defined in Rule 501(a) of Regulation
D.
(c)
Reliance on Exemptions. Such Buyer understands that the Securities are being offered and sold to it in reliance on specific exemptions
from the registration requirements of United States federal and state securities laws and that the Company is relying in part upon the
truth and accuracy of, and such Buyer’s compliance with, the representations, warranties, agreements, acknowledgments and understandings
of such Buyer set forth herein in order to determine the availability of such exemptions and the eligibility of such Buyer to acquire
the Securities. Such Buyer is not purchasing the Securities as a result of any advertisement, article, notice or other communication
regarding the Securities published in any newspaper, magazine or similar media or broadcast over television or radio or presented at
any seminar or any other general solicitation or general advertisement.
(d)
Information. Such Buyer and its advisors, if any, have been furnished with all materials relating to the business, finances and
operations of the Company and materials relating to the offer and sale of the Securities that have been requested by such Buyer. Such
Buyer acknowledges that it has had the opportunity to review the Transaction documents (as hereinafter defined) (including all exhibits
and schedules thereto) and the SEC Documents (as defined below). Such Buyer and its advisors, if any, have been afforded the opportunity
to (i) ask questions of the Company regarding its business and affairs, financial condition, results of operations, business, properties,
management and prospects sufficient to enable it to evaluate its investment, (ii) the terms and conditions of the offering of the Securities
and the merits and risks of investing in the Securities, and (iii) the opportunity to obtain such additional information that the Company
possesses or can acquire without unreasonable effort or expense that is necessary to make an informed investment decision with respect
to the investment. Other than consummating the transactions contemplated hereunder, such Buyer has not, nor has any Person acting on
behalf of or pursuant to any understanding with such Buyer, directly or indirectly executed any purchases or sales, including short sales
(as defined in Rule 200 of Regulation SHO under the 1934 Act (but shall not be deemed to include locating and/or borrowing shares of
Common Stock)), of the securities of the Company during the period commencing as of the time that such Buyer first received a term sheet
(written or oral) from the Company or any other Person representing the Company setting forth the material terms of the transactions
contemplated hereunder and ending immediately prior to the execution hereof. For the avoidance of doubt, other than knowledge of the
transactions contemplated by this Agreement, the Company has not disclosed to the Buyer any material nonpublic information regarding
the Company or otherwise and agrees that it will not disclose such information unless such information is disclosed to the public prior
to or promptly following such disclosure to the Buyer. Neither such inquiries nor any other due diligence investigations conducted by
such Buyer or its advisors, if any, or its representatives shall modify, amend or affect such Buyer’s right to rely on the Company’s
representations and warranties contained herein. Such Buyer understands that its investment in the Securities involves a high degree
of risk. Such Buyer has sought such accounting, legal and tax advice as it has considered necessary to make an informed investment decision
with respect to its acquisition of the Securities. Such Buyer, either alone or together with its representatives, has such knowledge,
sophistication and experience in business and financial matters so as to be capable of evaluating the merits and risks of the prospective
investment in the Securities, and has so evaluated the merits and risks of such investment. Such Buyer is able to bear the economic risk
of an investment in the Securities and, at the present time, is able to afford a complete loss of such investment. Such Buyer understands
that its investment in the Securities involves a high degree of risk.
(e)
No Governmental Review. Such Buyer understands that no United States federal or state agency or any other government or governmental
agency has passed on or made any recommendation or endorsement of the Securities or the fairness or suitability of the investment in
the Securities nor have such authorities passed upon or endorsed the merits of the offering of the Securities.
(f)
Transfer or Resale. Such Buyer understands that except as provided in the Registration Rights Agreement and Section 4(f) hereof:
(i) the Securities have not been and are not being registered under the 1933 Act or any state securities laws, and may not be offered
for sale, sold, assigned or transferred unless (A) subsequently registered thereunder, (B) such Buyer shall have delivered to the Company
(if requested by the Company) an opinion of counsel, in a generally acceptable form, to the effect that such Securities to be sold, assigned
or transferred may be sold, assigned or transferred pursuant to an exemption from such registration, or (C) such Buyer provides the Company
with reasonable assurance that such Securities can be sold, assigned or transferred pursuant to Rule 144 or Rule 144A promulgated under
the 1933 Act, as amended, (or a successor rule thereto) (collectively, “Rule 144”); (ii) any sale of the Securities
made in reliance on Rule 144 may be made only in accordance with the terms of Rule 144 and further, if Rule 144 is not applicable, any
resale of the Securities under circumstances in which the seller (or the Person through whom the sale is made) may be deemed to be an
underwriter (as that term is defined in the 1933 Act) may require compliance with some other exemption under the 1933 Act or the rules
and regulations of the SEC thereunder; and (iii) neither the Company nor any other Person is under any obligation to register the Securities
under the 1933 Act or any state securities laws or to comply with the terms and conditions of any exemption thereunder. 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 and such pledge of Securities shall not be deemed to be a transfer, sale or assignment of the Securities hereunder,
and no Buyer effecting such pledge of Securities shall be required to provide the Company with any notice thereof or otherwise make any
delivery to the Company pursuant to this Agreement or any other Transaction Document (as defined in Section 3(b)), including, without
limitation, this Section 2(f).
(g)
Legends. Such Buyer understands that the certificates or other instruments representing the Purchased Shares and the Warrants
and, until such time as the resale of the Purchased Shares and the Warrant Shares have been registered under the 1933 Act as contemplated
by the Registration Rights Agreement, the share certificates representing the Warrant Shares, except as set forth below, shall bear a
restrictive legend in substantially the following form (and a stop-transfer order may be placed against transfer of such share certificates):
NEITHER
THE ISSUANCE AND SALE OF THE SECURITIES REPRESENTED BY THIS CERTIFICATE NOR THE SECURITIES INTO WHICH THESE SECURITIES ARE EXERCISABLE
HAVE BEEN][THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN] REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED, OR APPLICABLE STATE SECURITIES LAWS. THE SECURITIES MAY NOT BE OFFERED FOR SALE, SOLD, TRANSFERRED OR ASSIGNED (I) IN THE ABSENCE
OF (A) AN EFFECTIVE REGISTRATION STATEMENT FOR THE SECURITIES UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR (B) AN OPINION OF COUNSEL
SELECTED BY THE HOLDER, IN A GENERALLY ACCEPTABLE FORM, THAT REGISTRATION IS NOT REQUIRED UNDER SAID ACT OR (II) UNLESS 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
legend set forth above shall be removed and the Company shall issue a certificate or book- entry statement without such legend to the
holder of the Securities upon which it is stamped or issue to such holder by electronic delivery at the applicable balance account at
The Depository Trust Company (“DTC”), if (i) such Securities are registered for resale under the 1933 Act, (ii) in
connection with a sale, assignment or other transfer, such holder provides the Company with an opinion of counsel, in a generally acceptable
form, to the effect that such sale, assignment or transfer of the Securities may be made without registration under the applicable requirements
of the 1933 Act, or (iii) the Securities can be sold, assigned or transferred pursuant to Rule 144 or Rule 144A (assuming cashless exercise
of the Warrants). The Company shall be responsible for the fees of its transfer agent and all DTC fees associated with such issuance.
If the Company shall fail to cause the transfer agent to issue to the holder of the Securities within one (1) Trading Day (as defined
in the Warrants) after the occurrence of any of (i) through (iii) above, a certificate without such legend to such holder or to issue
such Securities to such holder by electronic delivery at the applicable balance account at DTC, and if on or after such Trading Day 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 such Securities that the holder anticipated receiving without legend from the Company, then the Company shall promptly honor its obligation
to deliver to the holder such unlegended Securities as provided above and pay cash to the holder in the amount if any, by which (x) the
holder’s total purchase price (including brokerage commissions, if any) for the shares of Common Stock so purchased, exceeds (y)
the amount obtained by multiplying (1) such number of shares of Common Stock, times (2) the price at which the sell order giving rise
to such purchase obligation was executed, The Company shall be responsible for the fees of its transfer agent and all DTC fees associated
with such issuance.
(h)
Validity; Enforcement. This Agreement and the Registration Rights Agreement have been duly and validly authorized, executed and
delivered on behalf of such Buyer and shall constitute the legal, valid and binding obligations of such Buyer enforceable against such
Buyer in accordance with their respective terms, except as such enforceability may be limited by general principles of equity or to applicable
bankruptcy, insolvency, reorganization, moratorium, liquidation and other similar laws relating to, or affecting generally, the enforcement
of applicable creditors’ rights and remedies.
(i)
No Conflicts. The execution, delivery and performance by such Buyer of this Agreement and the Registration Rights Agreement and
the consummation by such Buyer of the transactions contemplated hereby and thereby will not (i) result in a violation of the organizational
documents of such Buyer or (ii) conflict with, or constitute a default (or an event which with notice or lapse of time or both would
become a default) under, or give to others any rights of termination, amendment, acceleration or cancellation of, any agreement, indenture
or instrument to which such Buyer is a party, or (iii) result in a violation of any law, rule, regulation, order, judgment or decree
(including federal and state securities laws) applicable to such Buyer, except in the case of clauses (ii) and (iii) above, for such
conflicts, defaults, rights or violations which would not, individually or in the aggregate, reasonably be expected to have a material
adverse effect on the ability of such Buyer to perform its obligations hereunder
(j) Organization.
Such Buyer is either an individual or an entity duly incorporated or formed, validly existing and in good standing under the laws of
the jurisdiction of its incorporation or formation with full right, corporate, partnership, limited liability company or similar power
and authority to enter into and to consummate the transactions contemplated by this Agreement and the Registration Rights Agreement and
otherwise to carry out its obligations hereunder and thereunder.
3.
REPRESENTATIONS AND WARRANTIES OF THE COMPANY.
The
Company represents and warrants to each of the Buyers that, as of the date hereof and as of the Closing Date:
(a)
Organization and Qualification. Each of the Company and each of its “Subsidiaries” (which for purposes of this
Agreement means any entity in which the Company, directly or indirectly, owns a controlling interest in any of the capital stock or holds
an equity or similar interest, including a variable interest entity) are entities duly organized and validly existing and in good standing
under the laws of the jurisdiction in which they are formed, and have the requisite power and authorization to own their properties and
to carry on their business as now being conducted and as presently proposed to be conducted. Each of the Company and each of its Subsidiaries
is duly qualified as a foreign entity to do business and is in good standing in every jurisdiction in which its ownership of property
or the nature of the business conducted by it makes such qualification necessary, except to the extent that the failure to be so qualified
or be in good standing would not reasonably be expected to have a Material Adverse Effect. As used in this Agreement, “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, taken as a whole, or on the transactions
contemplated hereby or in any of the other Transaction Documents or any other agreements or instruments to be entered into in connection
herewith or therewith, or on the authority or ability of the Company or any of its Subsidiaries to perform any of their respective obligations
under any of the Transaction Documents (as defined below). All Subsidiaries of the Company are disclosed in the SEC Documents (as defined
below), except as set forth in Schedule 3(a). The outstanding shares of capital stock of each of the Subsidiaries have been duly
authorized and validly issued, are fully paid and non-assessable and are owned by the Company or another Subsidiary free and clear of
all liens, encumbrances and equities and claims; and no options, warrants or other rights to purchase, agreements or other obligations
to issue or other rights to convert any obligations into shares of capital stock or ownership interests in the Subsidiaries are outstanding.
(b)
Authorization; Enforcement; Validity. The Company has the requisite corporate power and authority to enter into and perform its
obligations under this Agreement, the Warrants, the Registration Rights Agreement, the Lock-Up Agreements (as defined in Section 7(x)),
the Irrevocable Transfer Agent Instructions (as defined in Section 5(b)), and each of the other agreements entered into by the parties
hereto in connection with the transactions contemplated by this Agreement (collectively, the “Transaction Documents”)
and to issue the Securities in accordance with the terms hereof and thereof. The execution and delivery of this Agreement and the other
Transaction Documents by the Company and the consummation by the Company of the transactions contemplated hereby and thereby, including,
without limitation, the issuance of the Purchased Shares and the Warrants and the reservation for issuance and the issuance of the Warrant
Shares issuable upon exercise of the Warrants have been duly authorized by the Company’s Board of Directors and (other than the
filing with the SEC of one or more Registration Statements (as defined in the Registration Rights Agreement) in accordance with the requirements
of the Registration Rights Agreement, the filings required pursuant to Section 4(i) of this Agreement, a Form D with the SEC and any
other filings as may be required by any state securities agencies and submission of a listing application with Nasdaq if applicable)
no further filing, consent or authorization is required by the Company, its Board of Directors or its shareholders. This Agreement and
the other Transaction Documents have been duly executed and delivered by the Company, and constitute the legal, valid and binding obligations
of the Company, enforceable against the Company in accordance with their respective terms, except as such enforceability may be limited
by general principles of equity or applicable bankruptcy, insolvency, reorganization, moratorium, liquidation or similar laws relating
to, or affecting generally, the enforcement of applicable creditors’ rights and remedies.
(c)
Issuance of Securities. The issuance of the Securities has been duly authorized and, when issued and paid for in accordance with
the applicable Transaction Documents, the Purchased Shares and the Warrants shall be validly issued and free from all preemptive or similar
rights (except for those which have been validly waived prior to the date hereof), taxes, liens and charges and other encumbrances with
respect to the issue thereof and the Purchased Shares will be fully paid and nonassessable with the holders being entitled to all rights
accorded to a holder of shares of Common Stock. As of the Closing Date, a number of shares of Common Stock shall have been duly authorized
and reserved for issuance which equals at least the sum of (i) the maximum number of shares of Common Stock issuable upon exercise of
the Pre-Funded Warrants, (ii) the maximum number of shares of Common Stock issuable upon exercise of the Series A Warrants and (iii)
the maximum number of shares of Common Stock issuable upon exercise of the Series B Warrants, in each case, without giving effect to
any limitation on exercise set forth therein and, with respect to the Series A Warrants, assuming a Reset Price (as defined in the Series
A Warrant) equal to $0.0524 (as adjusted for share splits, share dividends, recapitalizations, reorganizations, reclassification, combinations,
reverse share splits or other similar events occurring after the date hereof) and with respect to the Series B Warrants, assuming that
the Maximum Eligibility Number (as defined in the Series B Warrant) is determined based on a Reset Price (as defined in the Series B
Warrants) equal to $0.0524 (as adjusted for share splits, share dividends, recapitalizations, reorganizations, reclassification, combinations,
reverse share splits or other similar events occurring after the date hereof) (the “Required Reserved Amount”). Upon
exercise of the Warrants in accordance with the Warrants and receipt of the exercise price thereunder, the Warrant Shares when issued
will be validly issued, fully paid and nonassessable and free from all preemptive or similar rights, taxes, liens, charges and other
encumbrances with respect to the issue thereof, with the holders being entitled to all rights accorded to a holder of shares of Common
Stock. Assuming the accuracy of each of the representations and warranties set forth in Section 2 of this Agreement, the offer and issuance
by the Company of the Securities is exempt from registration under the 1933 Act.
(d)
No Conflicts. The execution, delivery and performance of the Transaction Documents by the Company and the consummation by the
Company of the transactions contemplated hereby and thereby (including, without limitation, the issuance of the Purchased Shares and
the Warrants and reservation for issuance and issuance of the Warrant Shares) will not (i) conflict with or result in a violation of
the Certificate of Incorporation, as amended, the Bylaws or other organizational documents of the Company or any of its Subsidiaries,
or any capital stock or other securities of the Company or any of its Subsidiaries, (ii) conflict with, or constitute a default (or an
event which with notice or lapse of time or both would become a default) in any respect under, or give to others any rights of termination,
amendment, acceleration or cancellation of, any agreement, indenture or instrument to which the Company or any of its Subsidiaries is
a party, or (iii) result in a violation of any law, rule, regulation, order, judgment or decree (including foreign, federal and state
securities laws and regulations and the rules and regulations of The Nasdaq Capital Market, or any of the markets or exchanges on which
the Common Stock is primarily listed or quoted for trading (the “Principal Market”) and including all applicable foreign,
federal, state laws, rules and regulations) applicable to the Company or any of its Subsidiaries or by which any property or asset of
the Company or any of its Subsidiaries is bound or affected except, with respect to clauses (ii) and (iii) above, for such conflicts,
defaults, terminations, amendments, accelerations, cancellations and violations as would not, individually or in the aggregate, have
a Material Adverse Effect.
(e)
Consents. Except for the Stockholder Approval (as defined in the Series A Warrants and Series B Warrants) and as disclosed in
the Company’s SEC Documents or as disclosed in Schedule 3(e), neither the Company nor any Subsidiary is required to obtain
any consent from, authorization or order of, or make any filing or registration with (other than the filing with the SEC of one or more
Registration Statements in accordance with the requirements of the Registration Rights Agreement, a Form D with the SEC, the filings
required pursuant to Section 4(i) of this Agreement and any other filings as may be required by any state securities agencies and the
filing of required notices and/or applications to the Principal Market for the issuance and sale of the securities hereby), any court,
governmental agency (defined for purposes herein as, means any nation, state, county, city, town, village, district, or other political
jurisdiction of any nature, federal, state, local, municipal, foreign, or other government, governmental or quasi-governmental authority
of any nature (including any governmental agency, branch, department, official, or entity and any court or other tribunal), multi-national
organization or body; or body exercising, or entitled to exercise, any administrative, executive, judicial, legislative, police, regulatory,
or taxing authority or power of any nature or instrumentality of any of the foregoing, including any entity or enterprise owned or controlled
by a government or a public international organization or any of the foregoing) or any regulatory or self-regulatory agency or any other
Person in order for it to execute, deliver or perform any of their respective obligations under or contemplated by the Transaction Documents,
in each case, in accordance with the terms hereof or thereof. All consents, authorizations, orders, filings and registrations which the
Company or any of its Subsidiaries is required to obtain pursuant to the preceding sentence have been obtained or effected on or prior
to the Closing Date (or in the case of filings detailed above, will be made timely after the Closing Date), and neither the Company nor
any of its Subsidiaries is aware of any facts or circumstances which might prevent the Company or any of its Subsidiaries from obtaining
or effecting any of the registration, application or filings contemplated by the Transaction Documents. Except with respect to the minimum
bid price and the audit committee composition requirements of the Principal Market, the Company is not in violation of the listing requirements
of the Principal Market and has no knowledge of any facts or circumstances which would reasonably lead to delisting or suspension of
the Common Stock in the foreseeable future. The issuance by the Company of the Securities shall not have the effect of delisting or suspending
the Common Stock from the Principal Market.
(f)
Acknowledgment Regarding Buyer’s Purchase of Securities. The Company acknowledges and agrees that each Buyer is acting solely
in the capacity of an arm’s length purchaser with respect to the Transaction Documents and the transactions contemplated hereby
and thereby and that no Buyer is (i) an officer or director of the Company or any of its Subsidiaries, (ii) an “affiliate”
of the Company or any of its Subsidiaries (as defined in Rule 144) or (iii) to the knowledge of the Company, a “beneficial owner”
of more than 10% of the Common Stock (as defined for purposes of Rule 13d-3 of the Securities Exchange Act of 1934, as amended (the “1934
Act”)). The Company further acknowledges that no Buyer is acting as a financial advisor or fiduciary of the Company or any
of its Subsidiaries (or in any similar capacity) with respect to the Transaction Documents and the transactions contemplated hereby and
thereby, and any advice given by a Buyer or any of its representatives or agents in connection with the Transaction Documents and the
transactions contemplated hereby and thereby is merely incidental to such Buyer’s purchase of the Securities. The Company further
represents to each Buyer that the Company’s decision to enter into the Transaction Documents has been based solely on the independent
evaluation by the Company and its representatives.
(g)
No General Solicitation; Placement Agent’s Fees. Neither the Company, nor any of its Subsidiaries or affiliates, nor any
Person acting on its or their behalf, has engaged in any form of general solicitation or general advertising (within the meaning of Regulation
D) in connection with the offer or sale of the Securities. At the Closing, the Company has agreed to reimburse the Placement Agent up
to $50,000 for the reasonable and accounted fees and expenses of legal counsel, both of which shall be deducted from closing proceeds.
Except as expressly set forth in the Transaction Documents to the contrary, each party shall pay the fees and expenses of its advisers,
counsel, accountants and other experts, if any, and all other expenses incurred by such party incident to the negotiation, preparation,
execution, delivery and performance of this Agreement. The Company shall pay all transfer agent fees (including, without limitation,
any fees required for same-day processing of any instruction letter delivered by the Company and any exercise notice delivered by a Buyer),
stamp taxes and other taxes and duties levied in connection with the delivery of any Securities to the Buyers.
(h)
No Integrated Offering. Assuming the accuracy of the Buyers’ representations and warranties set forth in Section 2, none
of the Company, its Subsidiaries or any of their affiliates, nor any Person acting on their behalf has, directly or indirectly, made
any offers or sales of any security or solicited any offers to buy any security, under circumstances that would require registration
of the issuance of any of the Securities under the 1933 Act, whether through integration with prior offerings or otherwise, or cause
this offering of the Securities to require approval of shareholders of the Company for purposes of the 1933 Act or any applicable shareholder
approval provisions, including, without limitation, under the rules and regulations of any exchange or automated quotation system on
which any of the securities of the Company are listed or designated for quotation. None of the Company, its Subsidiaries, their affiliates
nor any Person acting on their behalf will take any action or steps that would require registration of the issuance of any of the Securities
under the 1933 Act or cause the offering of any of the Securities to be integrated with other offerings of securities of the Company.
(i)
Application of Takeover Protections; Rights Agreement. The Company and its Board of Directors have taken all necessary action,
if any, in order to render inapplicable any control share acquisition, interested shareholder, business combination, poison pill (including,
without limitation, any distribution under a rights agreement) or other similar anti-takeover provision under the Certificate of Incorporation,
as amended, or other organizational documents or the laws of the jurisdiction of its formation which is or could become applicable to
any Buyer as a result of the transactions contemplated by this Agreement, including, without limitation, the Company’s issuance
of the Securities and any Buyer’s ownership of the Securities. The Company and its Board of Directors have taken all necessary
action, if any, in order to render inapplicable any shareholder rights plan or similar arrangement relating to accumulations of beneficial
ownership of shares of Common Stock or a change in control of the Company or any of its Subsidiaries.
(j)
SEC Documents; Financial Statements. Since September 23, 2022, the Company has timely (other than any reports that are required
solely pursuant to Items 1.01, 1.02, 1.04, 1.05, 2.03, 2.04, 2.05, 2.06, 4.02(a) or 5.02(e) of Form 8-K) filed all reports, schedules,
forms, statements and other documents required to be filed by it with the SEC pursuant to the reporting requirements of the 1934 Act
(all of the foregoing filed prior to the date hereof or prior to the Closing Date, and all exhibits and appendices included therein and
financial statements, notes and schedules thereto (other than schedules or appendices to such documents permitted to be excluded therefrom)
and documents incorporated by reference therein being hereinafter referred to as the “SEC Documents”). As of their
respective filing dates, the SEC Documents complied in all material respects with the requirements of the 1934 Act applicable to the
Company and the rules and regulations of the SEC promulgated thereunder applicable to the SEC Documents, and none of the SEC Documents,
at the time they were filed with the SEC, contained any untrue statement of a material fact or omitted to state a material fact required
to be stated therein or necessary in order to make the statements therein, in the light of the circumstances under which they were made,
not misleading. As of their respective filing dates, the financial statements of the Company included in the SEC Documents complied as
to form in all material respects with applicable accounting requirements and the published rules and regulations of the SEC with respect
thereto. Such financial statements have been prepared in accordance with the U.S. generally accepted accounting principles (“GAAP”)
consistently applied during the periods involved (except (i) as may be otherwise indicated in such financial statements or the notes
thereto, or (ii) in the case of unaudited interim statements, to the extent they may exclude footnotes or may be condensed or summary
statements) and fairly present in all material respects the financial position of the Company and its Subsidiaries as of the dates thereof
and the results of its operations and cash flows for the periods then ended (subject, in the case of unaudited statements, to normal
year-end audit adjustments which will not be material, either individually or in the aggregate). No other information provided by or
on behalf of the Company to any of the Buyers which is not included in the SEC Documents (including, without limitation, information
referred to in Section 2(d) of this Agreement or in the disclosure schedules to this Agreement) contains any untrue statement of a material
fact or omits to state any material fact necessary in order to make the statements therein, in light of the circumstance under which
they are or were made, not misleading. The Company is not currently contemplating to amend or restate any of the financial statements
(including, without limitation, any notes or any letter of the independent accountants of the Company with respect thereto) included
in the SEC Documents (the “Financial Statements”), nor is the Company currently aware of facts or circumstances which
would require the Company to amend or restate any of the Financial Statements, in each case, in order for any of the Financial Statements
to be in compliance with GAAP and the rules and regulations of the SEC. The Company has not been informed by its independent accountants
that they recommend that the Company amend or restate any of the Financial Statements or that there is any need for the Company to amend
or restate any of the Financial Statements.
(k)
Absence of Certain Changes. Since the date of the latest quarterly financial statements included within the SEC Documents, except
as disclosed in the Company’s SEC Documents or as disclosed in Schedule 3(k)(i), there has been no material adverse
change and no material adverse development in the business, assets, liabilities, properties, operations, condition (financial or otherwise),
results of operations or prospects of the Company or any of its Subsidiaries. Since the date of the latest quarterly financial statements
included within the SEC Documents, except as disclosed in the Company’s SEC Documents or as disclosed in Schedule 3(k)(ii),
neither the Company nor any of its Subsidiaries has (i) declared or paid any dividends, (ii) sold any assets, individually or in the
aggregate, in excess of $800,000 outside of the ordinary course of business or (iii) had capital expenditures, individually or in the
aggregate, in excess of $100,000. Neither the Company nor any of its Subsidiaries has taken any steps to seek protection pursuant to
any law or statute relating to bankruptcy, insolvency, reorganization, receivership, liquidation or winding up, nor does the Company
or any Subsidiary have any knowledge or reason to believe that any of their respective creditors intend to initiate involuntary bankruptcy
proceedings or any actual knowledge of any fact which would reasonably lead a creditor to do so. The Company and its Subsidiaries, individually
and on a consolidated basis, are not as of the date hereof after giving effect to the transactions contemplated hereby to occur at the
Closing, will not be Insolvent (as defined below). For purposes of this Section 3(k), “Insolvent” means, (i) with
respect to the Company and its Subsidiaries, on a consolidated basis, (A) the present fair saleable value of the Company’s and
its Subsidiaries’ assets is less than the amount required to pay the Company’s and its Subsidiaries’ total Indebtedness
(as defined below), (B) the Company and its Subsidiaries are unable to pay their debts and liabilities, subordinated, contingent or otherwise,
as such debts and liabilities become absolute and matured or (C) the Company and its Subsidiaries intend to incur or believe that they
will incur debts that would be beyond their ability to pay as such debts mature; and (ii) with respect to the Company and each Subsidiary,
individually, (A) the present fair saleable value of the Company’s or such Subsidiary’s (as the case may be) assets is less
than the amount required to pay its respective total Indebtedness, (B) the Company or such Subsidiary (as the case may be) is unable
to pay its respective debts and liabilities, subordinated, contingent or otherwise, as such debts and liabilities become absolute and
matured or (C) the Company or such Subsidiary (as the case may be) intends to incur or believes that it will incur debts that would be
beyond its respective ability to pay as such debts mature.
(l)
No Undisclosed Events, Liabilities, Developments or Circumstances. No event, liability, development or circumstance has occurred
or exists, or is reasonably expected to exist or to occur with respect to the Company, its Subsidiaries or any of their respective businesses,
properties, liabilities, prospects, operations (including results thereof), or condition (financial or otherwise), that would be required
to be disclosed by the Company under applicable securities laws on Form 8-K or on a registration statement on Form S-1,or any other applicable
SEC filing, filed with the SEC relating to an issuance and sale by the Company of its Common Stock and which has not been publicly announced,
could have a Material Adverse Effect.
(m)
Conduct of Business; Regulatory Permits. Neither the Company nor any of its Subsidiaries is in violation of any term of or in
default under its Certificate of Incorporation, as amended, any certificate of designations, preferences or rights of any other outstanding
series of preferred shares of the Company or any of its Subsidiaries or their organizational charter, certificate of formation or certificate
of incorporation or bylaws, respectively. Neither the Company nor any of its Subsidiaries is in violation of any judgment, decree or
order or any statute, ordinance, rule or regulation applicable to the Company or any of its Subsidiaries, and neither the Company nor
any of its Subsidiaries will conduct its business in violation of any of the foregoing, except in all cases for possible violations which
would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect. The Company and each of its Subsidiaries
possess all certificates, authorizations and permits issued by the appropriate foreign, federal or state regulatory authorities necessary
to conduct their respective businesses, except where the failure to possess such certificates, authorizations or permits would not have,
individually or in the aggregate, a Material Adverse Effect, and neither the Company nor any such Subsidiary has received any notice
of proceedings relating to the revocation or modification of any such certificate, authorization or permit. There is no agreement, commitment,
judgment, injunction, order or decree binding upon the Company or any of its Subsidiaries or to which the Company or any of its Subsidiaries
is a party which has or would reasonably be expected to have the effect of prohibiting or materially impairing any business practice
of the Company or any of its Subsidiaries, any acquisition of property by the Company or any of its Subsidiaries or the conduct of business
by the Company or any of its Subsidiaries as currently conducted other than such effects, individually or in the aggregate, which have
not had and would not reasonably be expected to have a Material Adverse Effect on the Company or any of its Subsidiaries. Without limiting
the generality of the foregoing, except as disclosed in the Company’s SEC Documents, the Company is not in violation of any of
the rules, regulations or requirements of the Principal Market and has no knowledge of any facts or circumstances that would reasonably
lead to delisting or suspension of the Common Stock by the Principal Market in the foreseeable future. Since September 27, 2022, (i)
the Common Stock has been listed or designated for quotation on the Principal Market, (ii) trading in the Common Stock has not been suspended
by the SEC or the Principal Market and (iii) except as disclosed in the Company’s SEC Documents, the Company has received no communication,
written or oral, from the SEC or the Principal Market regarding the suspension or delisting of the Common Stock from the Principal Market.
(n)
Foreign Corrupt Practices. Neither the Company, the Company’s subsidiary nor, to the knowledge of the Company or any Subsidiary,
any director, officer, agent, employee, nor any other person acting for or on behalf of the Company or the Company’s subsidiaries
(individually and collectively, a “Company Affiliate”) have violated the U.S. Foreign Corrupt Practices Act (the “FCPA”)
or any other applicable anti-bribery or anti-corruption laws, nor has any Company Affiliate offered, paid, promised to pay, or authorized
the payment of any money, or offered, given, promised to give, or authorized the giving of anything of value, to any officer, employee
or any other person acting in an official capacity for any Governmental Entity to any political party or official thereof or to any candidate
for political office (individually and collectively, a “Government Official”) or to any person under circumstances
where such Company Affiliate knew or was aware of a high probability that all or a portion of such money or thing of value would be offered,
given or promised, directly or indirectly, to any Government Official, for the purpose of: (i) (A) influencing any act or decision of
such Government Official in his/her official capacity, (B) inducing such Government Official to do or omit to do any act in violation
of his/her lawful duty, (C) securing any improper advantage, or (D) inducing such Government Official to influence or affect any act
or decision of any Governmental Entity, (ii) or assisting the Company or its Subsidiaries in obtaining or retaining business for or with,
or directing business to, the Company or its Subsidiaries.
(o)
Sarbanes-Oxley Act. Except as disclosed in the SEC Documents, the Company is in compliance with any and all applicable requirements
of the Sarbanes-Oxley Act of 2002, as amended, that are effective as of the date hereof, and any and all applicable rules and regulations
promulgated by the SEC thereunder that are effective as of the date hereof to the extent applicable to the Company.
(p)
Transactions With Affiliates. Except as disclosed in the Company’s SEC Documents or as described in Schedule (3)(p)(i),
no current or former employee, director, officer or major shareholder (direct or indirect) of the Company or its Subsidiaries, or, to
the knowledge of the Company, any affiliate of any thereof, is presently, or has ever been, (i) a party to any transaction with the Company
or its Subsidiaries (including any contract, agreement or other arrangement providing for the furnishing of services by, or rental of
real or personal property from, or otherwise requiring payments to, any such director, officer or shareholder or such associate or affiliate
or relative Subsidiaries (other than for ordinary course services as employees, officers or directors of the Company or any of its Subsidiaries))
or (ii) the direct or indirect owner of an interest in any corporation, firm, association or business organization which is a competitor,
supplier or customer of the Company or its Subsidiaries (except for a passive investment (direct or indirect) in less than 5% of the
common stock of a company whose securities are traded on or quoted through an Eligible Market (as defined in the Warrants)), nor does
any such Person receive income from any source other than the Company or its Subsidiaries which relates to the business of the Company
or its Subsidiaries or should properly accrue to the Company or its Subsidiaries, in each case in excess of $120,000 other than for (x)
payment of salary or consulting fees for services rendered, (y reimbursement for expenses incurred on behalf of the Company and (z) other
employee benefits, including equity award agreements under any equity compensation plan approved by the Board of Directors of the Company.
Except as disclosed in the Company’s SEC Documents or in Schedule (3)(p)(ii), no employee, officer, shareholder or director
of the Company or any of its Subsidiaries or member of his or her immediate family is indebted to the Company or its Subsidiaries, as
the case may be, nor is the Company or any of its Subsidiaries indebted (or committed to make loans or extend or guarantee credit) to
any of them, other than (i) for payment of salary or compensation for services rendered, (ii) reimbursement for reasonable expenses incurred
on behalf of the Company, and (iii) for other standard employee benefits made generally available to all employees or executives (including
share option agreements outstanding under any share option plan approved by the Board of Directors of the Company).
(q)
Equity Capitalization. As of the date hereof, the authorized share capital of the Company consists of: 4,000,000,000 shares of
Class A common stock; 1,000,000,000 shares of Class B common stock; 5,000 shares of Series A Convertible Preferred Stock; and one share
of Series B Preferred Stock. As of the date hereof, there were (i) 16,620,057 shares of Class A common stock outstanding; (ii) 279,203
shares of Class B common stock outstanding; (iii) an aggregate of 48,643,249 shares of Class A common stock reserved for future issuance
under the Nxu, Inc. Amended and Restated 2023 Omnibus Incentive Plan; (iv) an aggregate of 997,698 shares of Class A common stock underlying
outstanding options; (v) an aggregate of 3,495,518 shares of Class A common stock underlying outstanding restricted stock units; (vi)
an aggregate of 109,513 shares of Class A common stock reserved for future issuance under outstanding warrants (excluding the Warrants);
(vii) a maximum of 66,667 shares of Class A common stock issuable upon conversion of outstanding convertible notes (based on a conversion
price of $0.15); (viii) zero shares of Series A Convertible Preferred Stock outstanding; and (ix) one share of Series B Preferred Stock
outstanding. No shares of Common Stocks are held in treasury. All of such outstanding shares are duly authorized and have been, or upon
issuance will be, validly issued, fully paid and nonassessable. 750,204 of the Company’s issued and outstanding shares of Common
Stock on the date hereof are as of the date hereof owned by Persons who are “affiliates” (as defined in Rule 405 of the 1933
Act and calculated based on the assumption that only officers, directors and holders of at least 10% of the Company’s issued and
outstanding Common Stock are “affiliates” without conceding that any such Persons are “affiliates” for purposes
of federal securities laws) of the Company or any of its Subsidiaries. Except as disclosed in the Company’s SEC Documents, to the
Company’s knowledge, no Person owns 10% or more of the Company’s issued and outstanding shares of Common Stock (calculated
based on the assumption that all Convertible Securities (as defined below), whether or not presently exercisable or convertible, have
been fully exercised or converted (as the case may be) taking account of any limitations on exercise or conversion (including “blockers”)
contained therein without conceding that such identified Person is a 10% shareholder for purposes of federal securities laws). (i) Except
as disclosed in the SEC Documents, none of the Company’s or any Subsidiary’s capital stock is subject to preemptive rights
or any other similar rights or any liens or encumbrances suffered or permitted by the Company or any Subsidiary; (ii) except as disclosed
in the SEC Documents, there are no outstanding options, warrants, scrip, rights to subscribe to, calls or commitments of any character
whatsoever relating to, or securities or rights convertible into, or exercisable or exchangeable for, any capital stock of the Company
or any of its Subsidiaries, or contracts, commitments, understandings or arrangements by which the Company or any of its Subsidiaries
is or may become bound to issue additional capital stock of the Company or any of its Subsidiaries or options, warrants, scrip, rights
to subscribe to, calls or commitments of any character whatsoever relating to, or securities or rights convertible into, or exercisable
or exchangeable for, any capital stock of the Company or any of its Subsidiaries; (iii) except as disclosed in the SEC Documents or in
Schedule 3(q)(i), there are no outstanding debt securities, notes, credit agreements, credit facilities or other agreements, documents
or instruments evidencing Indebtedness of the Company or any of its Subsidiaries or by which the Company or any of its Subsidiaries is
or may become bound; (iv) except as disclosed in as disclosed in the SEC Documents, there are no financing statements securing obligations
in any amounts filed in connection with the Company or any of its Subsidiaries; (v) except as disclosed in the SEC Documents or in Schedule
3(q)(ii), there are no agreements or arrangements (other than pursuant to the Registration Rights Agreement) under which the Company
or any of its Subsidiaries is obligated to register the sale of any of their securities under the 1933 Act; (vi) except as disclosed
in the SEC Documents, there are no outstanding securities or instruments of the Company or any of its Subsidiaries which contain any
redemption or similar provisions, and there are no contracts, commitments, understandings or arrangements by which the Company or any
of its Subsidiaries is or may become bound to redeem a security of the Company or any of its Subsidiaries; (vii) except as disclosed
in the SEC Documents, there are no securities or instruments containing anti-dilution or similar provisions that will be triggered by
the issuance of the Securities; (viii) except as disclosed in the SEC Documents, neither the Company nor any Subsidiary has any stock
appreciation rights or “phantom stock” plans or agreements or any similar plan or agreement; and (ix) neither the Company
nor any of its Subsidiaries have any liabilities or obligations required to be disclosed in the SEC Documents which are not so disclosed
in the SEC Documents, other than those incurred in the ordinary course of the Company’s or its Subsidiaries’ respective businesses
and which, individually or in the aggregate, do not or could not have a Material Adverse Effect. True, correct and complete copies of
the Company’s Certificate of Incorporation, as amended and as in effect on the date hereof (the “Certificate of Incorporation”),
and the terms of all securities convertible into, or exercisable or exchangeable for, shares of Common Stock and the material rights
of the holders thereof in respect thereto have heretofore been filed as part of the SEC Documents.
(r)
Indebtedness and Other Contracts. Except as described in Schedule 3(r), neither the Company nor any of its Subsidiaries,
(i) except as disclosed in the SEC Documents, has any outstanding Indebtedness (as defined below), (ii) except as disclosed in the SEC
Documents, is a party to any contract, agreement or instrument, the violation of which, or default under which, by the other party(ies)
to such contract, agreement or instrument would reasonably be expected to result in a Material Adverse Effect, (iii) except as disclosed
in the SEC Documents, is in violation of any term of, or in default under, any contract, agreement or instrument relating to any Indebtedness,
except where such violations and defaults would not result, individually or in the aggregate, in a Material Adverse Effect, (iv) has
any financing statements securing obligations in any amounts filed in connection with the Company or any of its Subsidiaries or (v) except
as disclosed in the SEC Documents, is a party to any contract, agreement or instrument relating to any Indebtedness, the performance
of which, in the judgment of the Company’s officers, has or is expected to have a Material Adverse Effect. For purposes of this
Agreement: (x) “Indebtedness” of any Person means, without duplication (A) all indebtedness for borrowed money, (B)
all obligations issued, undertaken or assumed as the deferred purchase price of property or services (including, without limitation,
“finance leases” in accordance with GAAP, consistently applied during the periods involved) (other than trade payables entered
into in the ordinary course of business consistent with past practice), (C) all reimbursement or payment obligations with respect to
letters of credit, surety bonds and other similar instruments, (D) all obligations evidenced by notes, bonds, debentures or similar instruments,
including obligations so evidenced incurred in connection with the acquisition of property, assets or businesses, (E) all indebtedness
created or arising under any conditional sale or other title retention agreement, or incurred as financing, in either case with respect
to any property or assets acquired with the proceeds of such indebtedness (even though the rights and remedies of the seller or bank
under such agreement in the event of default are limited to repossession or sale of such property), (F) all monetary obligations under
any leasing or similar arrangement which, in connection with GAAP, consistently applied for the periods covered thereby, is classified
as a finance 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, claim, lien, tax, right of first refusal, pledge, charge,
security interest or other encumbrance upon or in any property or assets (including accounts and contract rights) owned by any Person,
even though the Person which owns such assets or property has not assumed or become liable for the payment of such indebtedness, and
(H) all Contingent Obligations in respect of indebtedness or obligations of others of the kinds referred to in clauses (A) through (G)
above; and (y) “Contingent Obligation” means, as to any Person, any direct or indirect liability, contingent or otherwise,
of that Person with respect to any indebtedness, finance 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.
(s)
Absence of Litigation. There is no action, suit, arbitration, proceeding, inquiry or investigation before or by the Principal
Market, any court, public board, government agency, self-regulatory organization or body pending or, to the knowledge of the Company,
threatened against or affecting the Company or any of its Subsidiaries, the Common Stock or any of the Company’s Subsidiaries or
any of the Company’s or its Subsidiaries’ officers or directors, whether of a civil or criminal nature or otherwise, in their
capacities as such which that could reasonably be expected to result in a Material Adverse Effect, except as disclosed in the SEC Documents.
Without limitation of the foregoing, there has not been, and to the knowledge of the Company, there is not pending or contemplated, any
investigation by the SEC involving the Company, any of its Subsidiaries or any current or former director or officer of the Company or
any of its Subsidiaries. The SEC has not issued any stop order or other order suspending the effectiveness of any registration statement
filed by the Company under the 1933 Act or the 1934 Act. After reasonable inquiry of its employees, the Company is not aware of any fact
which might result in or form the basis for any such action, suit, arbitration, investigation, inquiry or other proceeding. Neither the
Company nor any of its Subsidiaries is subject to any order, writ, judgment, injunction, decree, determination or award of any Governmental
Entity.
(t)
Insurance. The Company and each of its Subsidiaries are insured by insurers of recognized financial responsibility against such
losses and risks and in such amounts as management of the Company believes to be prudent and customary in the businesses in which the
Company and its Subsidiaries are engaged. Neither the Company nor any such Subsidiary has been refused any insurance coverage sought
or applied for and neither the Company nor any such Subsidiary has any reason to believe that it will be unable to renew its existing
insurance coverage as and when such coverage expires or to obtain similar coverage from similar insurers as may be necessary to continue
its business at a cost that would not have a Material Adverse Effect.
(u)
Employee Relations. Neither the Company nor any of its Subsidiaries is a party to any collective bargaining agreement or employs
any member of a union. The Company believes that its and its Subsidiaries’ relations with their respective employees are good.
No executive officer (as defined in Rule 501(f) promulgated under the 1933 Act) or other key employee of the Company or any of its Subsidiaries
has notified the Company or any such Subsidiary that such officer intends to leave the Company or any such Subsidiary or otherwise terminate
such officer’s employment with the Company or any such Subsidiary. No executive officer or other key employee of the Company or
any of its Subsidiaries is, or is now expected to be, in violation of any material term of any employment contract, confidentiality,
disclosure or proprietary information agreement, non-competition agreement, or any other contract or agreement or any restrictive covenant,
and the continued employment of each such executive officer or other key employee (as the case may be) does not subject the Company or
any of its Subsidiaries to any liability with respect to any of the foregoing matters. The Company and its Subsidiaries are in compliance
with all local and foreign laws and regulations respecting labor, employment and employment practices and benefits, terms and conditions
of employment and wages and hours, except where failure to be in compliance would not, either individually or in the aggregate, reasonably
be expected to result in a Material Adverse Effect.
(v)
Title over Real Property and Fixtures and Equipment. Each of the Company and its Subsidiaries holds good title to all real property,
leases in real property, facilities or other interests in real property owned or held by the Company or any of its Subsidiaries (the
“Real Property”) owned by the Company or any of its Subsidiaries (as applicable). The Real Property is free and clear
of all Liens and is not subject to any rights of way, building use restrictions, exceptions, variances, reservations, or limitations
of any nature except for (a) Liens for current taxes not yet due and (b) zoning laws and other land use restrictions that do not impair
the present or anticipated use of the property subject thereto. Any Real Property held under lease by the Company or any of its Subsidiaries
are held by them under valid, subsisting and enforceable leases with such exceptions as are not material and do not interfere with the
use made and proposed to be made of such property and buildings by the Company or any of its Subsidiaries. Each of the Company and its
Subsidiaries (as applicable) has good title to, or a valid leasehold interest in, the tangible personal property, equipment, improvements,
fixtures, and other personal property and appurtenances that are used by the Company or its Subsidiary in connection with the conduct
of its business (the “Fixtures and Equipment”). The Fixtures and Equipment are structurally sound, are in good operating
condition and repair, are adequate for the uses to which they are being put, are not in need of maintenance or repairs, except for ordinary,
routine maintenance and repairs, and are sufficient for the conduct of the Company’s and/or its Subsidiaries’ businesses
(as applicable) in the manner as conducted prior to the Closing. Each of the Company and its Subsidiaries owns all of the Fixtures and
Equipment free and clear of all Liens, except for (a) liens for current taxes not yet due and (b) zoning laws and other land use restrictions
that do not impair the present or anticipated use of the property subject thereto.
(w)
Intellectual Property Rights. The Company and its Subsidiaries own or possess adequate rights or licenses to use all trademarks,
trade names, service marks, service mark registrations, service names, patents, patent rights, copyrights, original works of authorship,
inventions, licenses, approvals, governmental authorizations, trade secrets and other intellectual property rights and all applications
and registrations therefor (“Intellectual Property Rights”) necessary to conduct their respective businesses as now
conducted. Except as disclosed in the SEC Documents, none of the Company’s or its Subsidiaries’ Intellectual Property Rights
have expired, terminated or been abandoned, or are expected to expire, terminate or be abandoned, within three years from the date of
this Agreement. The Company has no knowledge of any infringement by the Company or any of its Subsidiaries of Intellectual Property Rights
of others. There is no claim, action or proceeding being made or brought, or to the knowledge of the Company or any of its Subsidiaries,
being threatened, against the Company or any of its Subsidiaries regarding their Intellectual Property Rights except as could not have
or reasonably be expected to not have a Material Adverse Effect. The Company is not aware of any facts or circumstances which might give
rise to any of the foregoing infringements or claims, actions or proceedings. The Company and each of its Subsidiaries have taken reasonable
security measures to protect the secrecy, confidentiality and value of all of their Intellectual Property Rights.
(x)
Environmental Laws. The Company and its Subsidiaries (A) are in compliance with all Environmental Laws (as defined below), (B)
have received all permits, licenses or other approvals required of them under applicable Environmental Laws to conduct their respective
businesses and (C) are in compliance with all terms and conditions of any such permit, license or approval where, in each of the foregoing
clauses (A), (B) and (C), the failure to so comply could be reasonably expected to have, individually or in the aggregate, a Material
Adverse Effect. The term “Environmental Laws” means all local or foreign laws relating to pollution or protection
of human health or the environment (including, without limitation, ambient air, surface water, groundwater, land surface or subsurface
strata), including, without limitation, laws relating to emissions, discharges, releases or threatened releases of chemicals, pollutants,
contaminants, or toxic or hazardous substances or wastes (collectively, “Hazardous Materials”) into the environment,
or otherwise relating to the manufacture, processing, distribution, use, treatment, storage, disposal, transport or handling of Hazardous
Materials, as well as all authorizations, codes, decrees, demands or demand letters, injunctions, judgments, licenses, notices or notice
letters, orders, permits, plans or regulations issued, entered, promulgated or approved thereunder. No Hazardous Materials (A) have been
disposed of or otherwise released from any Real Property of the Company or any of its Subsidiaries in violation of any Environmental
Laws; or (B) are present on, over, beneath, in or upon any Real Property or any portion thereof in quantities that would constitute a
violation of any Environmental Laws. No prior use by the Company or any of its Subsidiaries of any Real Property has occurred that violates
any Environmental Laws, which violation would have a material adverse effect on the business of the Company or any of its Subsidiaries.
Neither the Company nor any of its Subsidiaries knows of any other person who or entity which has stored, treated, recycled, disposed
of or otherwise located on any Real Property any Hazardous Materials, including, without limitation, such substances as asbestos and
polychlorinated biphenyls. None of the Real Properties are subject to any environmental-related Liens.
(y)
Subsidiary Rights. The Company or one of its Subsidiaries has the right to vote, and (subject to limitations imposed by applicable
law or the Subsidiaries charter documents) to receive dividends and distributions on, all capital securities of its Subsidiaries as owned
by the Company or such Subsidiary.
(z)
Tax Status. Except for matters that would not, individually or in the aggregate, have or reasonably be expected to result in a
Material Adverse Effect, the Company and each of its Subsidiaries (i) has timely made or filed all income and all other tax returns,
reports and declarations required by any jurisdiction to which it is subject, (ii) has timely paid all taxes and other governmental assessments
and charges that are material in amount, shown or determined to be due on such returns, reports and declarations, except those being
contested in good faith and (iii) has set aside on its books provision reasonably adequate for the payment of all taxes for periods subsequent
to the periods to which such returns, reports or declarations apply. Except as disclosed in the SEC Documents, there are no unpaid taxes
in any material amount claimed in writing to be due by the taxing authority of any jurisdiction, and according to the best knowledge
of the officers of the Company and its Subsidiaries, there is no basis for any such claim. The Company is not operated in such a manner
as to qualify as a passive foreign investment company, as defined in Section 1297 of the Code. The transactions contemplated hereby do
not constitute an “ownership change” within the meaning of Section 382 of the Code, thereby preserving the Company’s
ability to utilize such NOLs.
(aa)
Internal Accounting and Disclosure Controls. Except as disclosed in the SEC Documents, the Company and each of its Subsidiaries
maintains internal control over financial reporting (as such term is defined in Rule 13a-15(f) under the 1934 Act) that is sufficient
to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external
purposes in accordance with generally accepted accounting principles, including that (i) transactions are executed in accordance with
management’s general or specific authorizations, (ii) transactions are recorded as necessary to permit preparation of financial
statements in conformity with GAAP and to maintain asset and liability accountability, (iii) access to assets or incurrence of liabilities
is permitted only in accordance with management’s general or specific authorization and (iv) the recorded accountability for assets
and liabilities is compared with the existing assets and liabilities at reasonable intervals and appropriate action is taken with respect
to any difference. Except as disclosed in the SEC Documents, the Company maintains disclosure controls and procedures (as such term is
defined in Rule 13a-15(e) under the 1934 Act) that are sufficient in ensuring that information required to be disclosed by the Company
in the reports that it files or submits under the 1934 Act is recorded, processed, summarized and reported, within the time periods specified
in the rules and forms of the SEC, including, without limitation, controls and procedures designed to ensure that information required
to be disclosed by the Company in the reports that it files or submits under the 1934 Act is accumulated and communicated to the Company’s
management, including its principal executive officer or officers and its principal financial officer or officers, as appropriate, to
allow timely decisions regarding required disclosure. Except as disclosed in the SEC Documents, neither the Company nor any of its Subsidiaries
has received any notice or correspondence from any accountant, Governmental Entity or other Person relating to any potential material
weakness or significant deficiency in any part of the internal controls over financial reporting of the Company or any of its Subsidiaries.
(bb)
Off Balance Sheet Arrangements. There is no transaction, arrangement, or other relationship between the Company or any of its
Subsidiaries and an unconsolidated or other off balance sheet entity that is required to be disclosed by the Company in its 1934 Act
filings and is not so disclosed or that otherwise would be reasonably likely to have a Material Adverse Effect.
(cc)
Investment Company Status. Neither the Company nor any of its Subsidiaries is, and upon consummation of the sale of the Securities,
and for so long as any Buyer holds any Securities, will not be, an “investment company,” an affiliate of an “investment
company,” a company controlled by an “investment company” or an “affiliated person” of, or “promoter”
or “principal underwriter” for, an “investment company” as such terms are defined in the Investment Company Act
of 1940, as amended.
(dd)
Acknowledgement Regarding Buyers’ Trading Activity. It is understood and acknowledged by the Company that (i) following
the public disclosure of the transactions contemplated by the Transaction Documents, in accordance with the terms thereof, none of the
Buyers have been asked by the Company or any of its Subsidiaries to agree, nor has any Buyer agreed with the Company or any of its Subsidiaries,
to desist from effecting any transactions in or with respect to (including, without limitation, purchasing or selling, long and/or short)
any securities of the Company, or “derivative” securities based on securities issued by the Company or to hold any of the
Securities for any specified term; (ii) any Buyer, and counterparties in “derivative” transactions to which any such Buyer
is a party, directly or indirectly, presently may have a “short” position in the Common Stock which was established prior
to such Buyer’s knowledge of the transactions contemplated by the Transaction Documents; (iii) each Buyer shall not be deemed to
have any affiliation with or control over any arm’s length counterparty in any “derivative” transaction; and (iv) each
Buyer may rely on the Company’s obligation to timely deliver shares of Common Stock upon conversion, exercise or exchange, as applicable,
of the Securities as and when required pursuant to the Transaction Documents for purposes of effecting trading in the Common Stock of
the Company. The Company further understands and acknowledges that following the public disclosure of the transactions contemplated by
the Transaction Documents pursuant to the Press Release (as defined below) one or more Buyers may engage in hedging and/or trading activities
(including, without limitation, the location and/or reservation of borrowable shares of Common Stock) at various times during the period
that the Securities are outstanding, including, without limitation, during the periods that the value and/or number of the Warrant Shares
deliverable with respect to the Securities are being determined and such hedging and/or trading activities (including, without limitation,
the location and/or reservation of borrowable shares of Common Stock), if any, can reduce the value of the existing shareholders’
equity interest in the Company both at and after the time the hedging and/or trading activities are being conducted. The Company acknowledges
that such aforementioned hedging and/or trading activities do not constitute a breach of this Agreement, the Warrants or any other Transaction
Document or any of the documents executed in connection herewith or therewith.
(ee)
Manipulation of Price. Neither the Company nor any of its Subsidiaries has, and, to the knowledge of the Company, no Person acting
on their behalf has, directly or indirectly, (i) taken any action designed to cause or to result in the stabilization or manipulation
of the price of any security of the Company or any of its Subsidiaries to facilitate the sale or resale of any of the Securities, (ii)
sold, bid for, purchased, or paid any compensation for soliciting purchases of, any of the Securities (other than the Placement Agent),
(iii) paid or agreed to pay to any Person any compensation for soliciting another to purchase any other securities of the Company or
any of its Subsidiaries or (iv) paid or agreed to pay any Person for research services with respect to any securities of the Company
or any of its Subsidiaries.
(ff)
U.S. Real Property Holding Corporation. Neither the Company nor any of its Subsidiaries is, or has ever been, and so long as any
of the Securities are held by any of the Buyers, shall become, a U.S. real property holding corporation within the meaning of Section
897 of the Internal Revenue Code of 1986, as amended, and the Company and each Subsidiary shall so certify upon any Buyer’s request.
(gg)
Eligibility for Registration; Shell Company Status. The Company is eligible to register the Purchased Shares and the Warrant Shares
for resale by the Buyers using Form S-1 or Form S-3 promulgated under the 1933 Act. The Company is not, and has never been, an issuer
identified in, or subject to, Rule 144(i).
(hh)
Transfer Taxes. On the Closing Date, all stock transfer or other taxes (other than income or similar taxes) which are required
to be paid in connection with the issuance, sale and transfer of the Securities to be sold to each Buyer hereunder will be, or will have
been, fully paid or provided for by the Company, and all laws imposing such taxes will be or will have been complied with.
(ii)
Bank Holding Company Act. Neither the Company nor any of its Subsidiaries or affiliates is subject to the Bank Holding Company
Act of 1956, as amended (the “BHCA”), and to regulation by the Board of Governors of the Federal Reserve System (the
“Federal Reserve”). Neither the Company nor any of its Subsidiaries or affiliates owns or controls, directly or indirectly,
five percent (5%) or more of the outstanding shares of any class of voting securities or twenty-five percent (25%) or more of the total
equity of a bank or any entity that is subject to the BHCA and to regulation by the Federal Reserve. Neither the Company nor any of its
Subsidiaries or affiliates exercises a controlling influence over the management or policies of a bank or any entity that is subject
to the BHCA and to regulation by the Federal Reserve.
(jj)
Compliance with Anti-Money Laundering Laws. The operations of the Company and its Subsidiaries
are and have been conducted at all times in compliance with applicable financial recordkeeping and reporting requirements
and all other applicable U.S. and non-U.S. anti-money laundering laws, rules and regulations, including, but not limited to, those of
the Currency and Foreign Transactions Reporting Act of 1970, as amended, the United
States Bank Secrecy Act, as amended by the USA PATRIOT Act of 2001, and the United States Money Laundering Control Act of 1986 (18 U.S.C.
§§1956 and 1957), as amended, as well as the implementing rules and regulations promulgated
thereunder, and the applicable money laundering statutes of all applicable jurisdictions, the rules and regulations thereunder and any
related or similar rules, regulations or guidelines, issued, administered or enforced by any governmental agency or self-regulatory body
(collectively, the “Anti-Money Laundering Laws”), and no action, suit or proceeding by or before any court or governmental
agency, authority or body or any arbitrator involving the Company or any of its Subsidiaries with respect to the Anti-Money Laundering
Laws is pending or, to the knowledge of the Company, threatened.
(kk)
No Conflicts with Sanctions Laws. Neither the Company nor any of its Subsidiaries, nor to
the knowledge of the Company or any Subsidiary, any director, officer, employee, agent, affiliate or other person associated with or
acting on behalf of the Company or any of its Subsidiaries or affiliates is, or is directly or indirectly owned or controlled by, a Person
that is currently the subject or the target of any sanctions administered or enforced by the U.S. government (including, without limitation,
the Office of Foreign Assets Control of the U.S. Department of the Treasury (“OFAC”) or the U.S. Departments of State
or Commerce and including, without limitation, the designation as a “Specially Designated National” or on the “Sectoral
Sanctions Identifications List”, collectively “Blocked Persons”), the United Nations Security Council, the European
Union, Her Majesty’s Treasury or any other relevant sanctions authority (collectively, “Sanctions Laws”); neither
the Company, any of its Subsidiaries, nor any director, officer, employee, agent, affiliate
or other person associated with or acting on behalf of the Company or any of its Subsidiaries or affiliates, is located, organized or
resident in a country or territory that is the subject or target of a comprehensive embargo or Sanctions Laws prohibiting trade with
the country or territory, including, without limitation, Crimea, Cuba, Iran, North Korea, Sudan and Syria (each, a “Sanctioned
Country”); the Company maintains in effect and enforces policies and procedures designed to ensure compliance by the
Company and its Subsidiaries with applicable Sanctions Laws; neither the Company, any of its Subsidiaries,
nor to the knowledge of the Company or any Subsidiary, any director, officer, employee, agent, affiliate or other person associated with
or acting on behalf of the Company or any of its Subsidiaries or affiliates, acting in any capacity in connection with the operations
of the Company, conducts any business with or for the benefit of any Blocked Person or engages in making or receiving any contribution
of funds, goods or services to, from or for the benefit of any Blocked Person, or deals in, or otherwise engages in any transaction relating
to, any property or interests in property blocked or subject to blocking pursuant to any applicable Sanctions Laws; no
action of the Company or any of its Subsidiaries in connection with (i) the execution, delivery and performance of this Agreement and
the other Transaction Documents, (ii) the issuance and sale of the Securities, or (iii) the direct or indirect use of proceeds from the
Securities or the consummation of any other transaction contemplated hereby or by the other Transaction Documents or the fulfillment
of the terms hereof or thereof, will result in the proceeds of the transactions contemplated hereby and by the other Transaction Documents
being used, or loaned, contributed or otherwise made available, directly or indirectly, to any Subsidiary, joint venture partner or other
person or entity, for the purpose of (i) unlawfully funding or facilitating any activities of or business with any person that, at the
time of such funding or facilitation, is the subject or target of Sanctions Laws, (ii) unlawfully funding or facilitating any activities
of or business in any Sanctioned Country or (iii) in any other manner that will result in a violation by any Person (including any Person
participating in the transaction, whether as underwriter, advisor, investor or otherwise) of Sanctions Laws. For the past five (5) years,
the Company and its Subsidiaries have not knowingly engaged in and are not now knowingly engaged in any dealings or transactions with
any person that at the time of the dealing or transaction is or was the subject or the target of Sanctions Laws or with any Sanctioned
Country.
(ll)
Anti-Bribery. Neither the Company nor any of the Subsidiaries has made any contribution
or other payment to any official of, or candidate for, any federal, state or foreign office in violation of any law. Neither
the Company, nor any of its Subsidiaries or affiliates, nor to the knowledge of the Company or any Subsidiary, any director, officer,
agent, employee or other person associated with or acting on behalf of the Company, or any of its Subsidiaries or affiliates, has (i)
used any funds for any unlawful contribution, gift, entertainment or other unlawful expense relating to political activity, (ii) made
any direct or indirect unlawful payment to any foreign or domestic government official or employee, to any employee or agent of a private
entity with which the Company does or seeks to do business or to foreign or domestic political parties or campaigns, (iii) violated or
is in violation of any provision of any applicable law or regulation implementing the OECD Convention on Combating Bribery of Foreign
Public Officials in International Business Transactions or any applicable provision of the U.S. Foreign Corrupt Practices Act of 1977,
as amended (the “FCPA”), the U.K. Bribery Act 2010, or any other similar law of any other jurisdiction in which the
Company operates its business, including, in each case, the rules and regulations thereunder (the “Anti-Bribery Laws”),
(iv) taken, is currently taking or will take any action in furtherance of an offer, payment, gift or anything else of value, directly
or indirectly, to any person while knowing that all or some portion of the money or value will be offered, given or promised to anyone
to improperly influence official action, to obtain or retain business or otherwise to secure any improper advantage or (v) otherwise
made any offer, bribe, rebate, payoff, influence payment, unlawful kickback or other unlawful payment; the Company and each of its respective
Subsidiaries has instituted and has maintained, and will continue to maintain, policies and procedures reasonably designed to promote
and achieve compliance with the laws referred to in (iii) above and with this representation and warranty; none of the Company, nor any
of its Subsidiaries or affiliates will directly or indirectly use the proceeds of the convertible securities or lend, contribute or otherwise
make available such proceeds to any subsidiary, affiliate, joint venture partner or other person or entity for the purpose of financing
or facilitating any activity that would violate the laws and regulations referred to in (iii) above; there are, and have been, no allegations,
investigations or inquiries with regard to a potential violation of any Anti-Bribery Laws by the Company, its Subsidiaries or affiliates,
or any of their respective current or former directors, officers, employees, shareholders, representatives or agents, or other
persons acting or purporting to act on their behalf.
(mm)
No Additional Agreements. The Company does not have any agreement or understanding with any Buyer with respect to the transactions
contemplated by the Transaction Documents other than as specified in the Transaction Documents.
(nn)
Disclosure. Except (i) with respect to the material terms and conditions of the transactions contemplated by the Transaction Documents
and/or (ii) for discussions specifically regarding the offer and sale of the Securities, the Company confirms that neither it nor any
other Person acting on its behalf has provided any of the Buyers or their agents or counsel with any information that constitutes or
could reasonably be expected to constitute material, non-public information concerning the Company or any of its Subsidiaries, other
than the existence of the transactions contemplated by this Agreement and the other Transaction Documents. The Company understands and
confirms that each of the Buyers will rely on the foregoing representations in effecting transactions in securities of the Company. All
disclosure provided to the Buyers regarding the Company and its Subsidiaries, their businesses and the transactions contemplated hereby,
including the schedules to this Agreement, furnished by or on behalf of the Company or any of its Subsidiaries is true and correct and
does not contain any untrue statement of a material fact or omit to state any material fact necessary in order to make the statements
made therein, in the light of the circumstances under which they were made, not misleading. All of the written information furnished
after the date hereof by or on behalf of the Company or any of its Subsidiaries to you pursuant to or in connection with this Agreement
and the other Transaction Documents, taken as a whole, will be true and correct in all material respects as of the date on which such
information is so provided and will not contain any untrue statement of a material fact or omit to state any material fact necessary
in order to make the statements made therein, in light of the circumstances under which they are made, not misleading. The press releases
issued by the Company or any of its Subsidiaries during the twelve (12) months preceding the date of this Agreement taken as a whole
did not at the time of release contain any untrue statement of a material fact or omit to state a material fact required to be stated
therein or necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading.
No event or circumstance has occurred or information exists with respect to the Company or any of its Subsidiaries or its or their business,
properties, liabilities, prospects, operations (including results thereof) or conditions (financial or otherwise), which, under applicable
law, rule or regulation, requires public disclosure at or before the date hereof or announcement by the Company but which has not been
so publicly disclosed. All financial projections and forecasts that have been prepared by or on behalf of the Company or any of its Subsidiaries
and made available to the Buyers have been prepared in good faith based upon reasonable assumptions and represented, at the time each
such financial projection or forecast was delivered to each Buyer, the Company’s best estimate of future financial performance
(it being recognized that such financial projections or forecasts are not to be viewed as facts and that the actual results during the
period or periods covered by any such financial projections or forecasts may differ from the projected or forecasted results). The Company
acknowledges and agrees that no Buyer makes or has made any representations or warranties with respect to the transactions contemplated
hereby other than those specifically set forth in Section 2.
(oo)
Share Option Plans. Each share option granted by the Company was granted (i) in accordance with the terms of the applicable Company
share option plan and (ii) with an exercise price at least equal to the fair market value of the Common Stock on the date such share
option would be considered granted under GAAP, consistently applied during the periods involved and applicable law. No share option granted
under the Company’s share option plan has been backdated. The Company has not knowingly granted, and there is no and has been no
Company policy or practice to knowingly grant, share options prior to, or otherwise knowingly coordinate the grant of share options with,
the release or other public announcement of material information regarding the Company or its Subsidiaries or their financial results
or prospects.
(pp)
No Disagreements with Accountants and Lawyers. There are no material disagreements of any kind presently existing, or reasonably
anticipated by the Company to arise, between the Company and the accountants and lawyers formerly or presently employed by the Company
and the Company is current with respect to any fees owed to its accountants and lawyers which could affect the Company’s ability
to perform any of its obligations under any of the Transaction Documents.
(qq)
No Disqualification Events. With respect to Securities to be offered and sold hereunder in reliance on Rule 506(b) under the 1933
Act (“Regulation D Securities”), none of the Company, any of its predecessors, any affiliated issuer, any director,
executive officer, other officer of the Company participating in the offering hereunder, any beneficial owner of 20% or more of the Company’s
outstanding voting equity securities, calculated on the basis of voting power, nor any promoter (as that term is defined in Rule 405
under the 1933 Act) connected with the Company in any capacity at the time of sale (each, an “Issuer Covered Person”
and, together, “Issuer Covered Persons”) is subject to any of the “Bad Actor” disqualifications described
in Rule 506(d)(1)(i) to (viii) under the 1933 Act (a “Disqualification Event”), except for a Disqualification Event
covered by Rule 506(d)(2) or (d)(3). The Company has exercised reasonable care to determine whether any Issuer Covered Person is subject
to a Disqualification Event. The Company has complied, to the extent applicable, with its disclosure obligations under Rule 506(e), and
has furnished to the Buyers a copy of any disclosures provided thereunder.
(rr)
Other Covered Persons. The Company is not aware of any Person (other than the Placement Agent) that has been or will be paid (directly
or indirectly) remuneration for solicitation of Buyers or potential purchasers in connection with the sale of any Regulation D Securities.
(ss)
Dilutive Effect. The Company understands and acknowledges that the number of Warrant Shares
issuable pursuant to terms of the Warrants will increase in certain circumstances. The Company further acknowledges that its obligation
to issue Warrant Shares pursuant to the terms of the Warrants in accordance with this Agreement and the Warrants is absolute and unconditional
regardless of the dilutive effect that such issuance may have on the ownership interests of other shareholders of the Company.
(tt)
Cybersecurity. (i)(x) To the best of the
Company’s knowledge, there has been no security breach or other compromise of or relating to any of the Company’s or any
Subsidiary’s information technology and computer systems, networks, hardware, software, data (including the data of its respective
customers, employees, suppliers, vendors and any third party data maintained by or on behalf of it), equipment or technology (collectively,
“IT Systems and Data”) except as would not, individual or in the aggregate, have a Material Adverse Effect and (y)
the Company and the Subsidiaries have not been notified of, and has no knowledge of any event or condition that would reasonably be expected
to result in, any security breach or other compromise to its IT Systems and Data except as would not, individual or in the aggregate,
have a Material Adverse Effect; (ii) the Company and the Subsidiaries are presently in material compliance with all applicable laws or
statutes and all judgments, orders, rules and regulations of any court or arbitrator or governmental or regulatory authority, internal
policies and contractual obligations relating to the privacy and security of IT Systems and Data and to the protection of such IT Systems
and Data from unauthorized use, access, misappropriation or modification, except as would not, individually or in the aggregate, have
a Material Adverse Effect; (iii) the Company and the Subsidiaries have implemented and maintained commercially reasonable safeguards
to maintain and protect its material confidential information and the integrity, continuous operation, redundancy and security of all
IT Systems and Data; and (iv) the Company and the Subsidiaries have implemented backup and disaster recovery technology consistent with
industry standards and practices.
(uu)
Compliance with Data Privacy Laws. (i) The Company and the Subsidiaries are, and at all times during the last three (3) years
were, in material compliance with all applicable state, federal and foreign data privacy and security laws and regulations, including,
without limitation, the European Union General Data Protection Regulation (“GDPR”) (EU 2016/679) (collectively, “Privacy
Laws”); (ii) the Company and the Subsidiaries have in place, comply with, and take appropriate steps reasonably designed
to ensure compliance with their policies and procedures relating to data privacy and security and the collection, storage, use, disclosure,
handling and analysis of Personal Data (as defined below) (the “Policies”); (iii) the Company provides accurate
notice of its applicable Policies to its customers, employees, third party vendors and representatives as required by the Privacy Laws;
and (iv) applicable Policies provide accurate and sufficient notice of the Company’s then-current privacy practices relating
to its subject matter, and do not contain any material omissions of the Company’s then-current privacy practices, as required by
Privacy Laws. “Personal Data” means (i) a natural person’s name, street address, telephone number,
email address, photograph, social security number, bank information, or customer or account number; (ii) any information which would
qualify as “personally identifying information” under the Federal Trade Commission Act, as amended; (iii) “personal
data” as defined by GDPR; and (iv) any other piece of information that allows the identification of such natural person, or
his or her family, or permits the collection or analysis of any identifiable data related to an identified person’s health or sexual
orientation. (i) None of such disclosures made or contained in any of the Policies have been inaccurate, misleading, or deceptive
in violation of any Privacy Laws and (ii) the execution, delivery and performance of the Transaction Documents will not result in
a breach of any Privacy Laws or Policies. Neither the Company nor the Subsidiaries (i) to the knowledge of the Company, has
received written notice of any actual or potential liability of the Company or the Subsidiaries under, or actual or potential violation
by the Company or the Subsidiaries of, any of the Privacy Laws; (ii) is currently conducting or paying for, in whole or in part,
any investigation, remediation or other corrective action pursuant to any regulatory request or demand pursuant to any Privacy Law; or
(iii) is a party to any order, decree, or agreement by or with any court or arbitrator or governmental or regulatory authority that
imposed any obligation or liability under any Privacy Law.
4.
COVENANTS.
(a)
Best Efforts. Each party shall use its reasonable best efforts timely to satisfy each of the covenants and the conditions to be
satisfied by it as provided in Sections 6 and 7 of this Agreement.
(b)
Form D and Blue Sky. If required, the Company agrees to file a Form D with respect to the Securities as required under Regulation
D. The Company shall, on or before the Closing Date, take such action as the Company shall reasonably determine is necessary in order
to obtain an exemption for or to qualify the Securities for sale to the Buyers at the Closing pursuant to this Agreement under applicable
securities or “Blue Sky” laws of the states of the United States (or to obtain an exemption from such qualification). The
Company shall make all filings and reports relating to the offer and sale of the Securities required under applicable securities or “Blue
Sky” laws of the states of the United States following the Closing Date.
(c)
Reporting Status. Until the date on which the Investors (as defined in the Registration Rights Agreement) shall have sold all
of the Purchased Shares and Warrant Shares and none of the Warrants are outstanding (the “Reporting Period”), the
Company shall timely file (or obtain extensions in respect thereof and file within the applicable grace period) all reports required
to be filed with the SEC pursuant to the 1934 Act, and the Company shall not terminate its status as an issuer required to file reports
under the 1934 Act even if the 1934 Act or the rules and regulations thereunder would no longer require or otherwise permit such termination,
and the Company shall use its reasonable commercial efforts to take all actions necessary to maintain its eligibility to register the
resale of the Purchased Shares and Warrant Shares by the Investors on Form S-3 or such other applicable form.
(d)
Use of Proceeds. The Company will use the proceeds from the sale of the Securities for general corporate purposes, but not, directly
or indirectly, for (i) except as set forth on Schedule 4(d), the satisfaction of any indebtedness of the Company or any of its
Subsidiaries (other than payment of trade payables in the ordinary course of the Company’s business and prior practices and the
satisfaction of indebtedness among the Company and its Subsidiaries), (ii) the redemption or repurchase of any securities of the Company
or any of its Subsidiaries, or (iii) the settlement of any outstanding litigation.
(e)
Financial Information. The Company agrees to send the following to each Investor (as defined in the Registration Rights Agreement)
during the Reporting Period (i) unless the following are filed with the SEC through EDGAR and are available to the public through the
EDGAR system, within one (1) Business Day after the filing thereof with the SEC, a copy of its Annual Reports on Form 10-K, periodic
reports containing financial statements on Form 10-Q, any Current Reports on Form 8-K (or any analogous reports under the 1934 Act) and
any registration statements or amendments filed pursuant to the 1933 Act, (ii) unless the following are filed with the SEC through EDGAR
and are available to the public through the EDGAR system, within one (1) Business Day after the filing thereof with the SEC or are available
to the public on the Company’s website on the same day as the release thereof, e-mailed copies of all press releases issued by
the Company or any of its Subsidiaries and (iii) unless the following are filed with the SEC through EDGAR and are available to the public
through the EDGAR system, within one (1) Business Day after the filing thereof with the SEC or are available to the public on the Company’s
website on the same day as the release thereof, copies of any notices and other information made available or given to the shareholders
of the Company generally, contemporaneously with the making available or giving thereof to the shareholders. As used herein, “Business
Day” means any day other than Saturday, Sunday or other day on which commercial banks in The City of New York are authorized
or required by law to remain closed.
(f)
Listing. The Company shall promptly secure the listing of all of the Registrable Securities (as defined in the Registration Rights
Agreement) upon each national securities exchange and automated quotation system, if any, upon which the Common Stock is then listed
(subject to official notice of issuance) and shall use its commercially reasonable efforts to maintain such listing of all Registrable
Securities from time to time issuable under the terms of the Transaction Documents. The Company shall maintain the authorization for
quotation of the Common Stock on the Principal Market or any other Eligible Market (as defined in the Warrants). Neither the Company
nor any of its Subsidiaries shall take any action which would be reasonably expected to result in the delisting or suspension of the
Common Stock on the Principal Market. The Company shall pay all fees and expenses in connection with satisfying its obligations under
this Section 4(f).
(g)
Fees. Subject to the $50,000 limitation for the reasonable and accounted fees and expenses of the Placement Agent, the Company
shall be responsible for the payment of the Placement Agent’s fees, financial advisory fees, transfer agent fees, DTC (as defined
below) fees, or broker’s commissions (other than for Persons engaged by any Buyer) relating to or arising out of the transactions
contemplated hereby, including, without limitation, any fees or commissions payable to the Placement Agent, including any legal fees
and expenses of the Placement Agent as set forth in the Transaction Documents. The Company shall pay, and hold each Buyer harmless against,
any liability, loss or expense (including, without limitation, reasonable attorney’s fees and out-of-pocket expenses) arising in
connection with any claim relating to any such payment. Except as otherwise set forth in the Transaction Documents, each party to this
Agreement shall bear its own expenses in connection with the sale of the Securities to the Buyers.
(h)
Pledge of Securities. The Company acknowledges and agrees that the Securities may be pledged by an Investor in connection with
a bona fide margin agreement or other loan or financing arrangement that is secured by the Securities. The pledge of Securities shall
not be deemed to be a transfer, sale or assignment of the Securities hereunder, and no Investor effecting a pledge of Securities shall
be required to provide the Company with any notice thereof or otherwise make any delivery to the Company pursuant to this Agreement or
any other Transaction Document, including, without limitation, Section 2(f) hereof; provided that an Investor and its pledgee
shall be required to comply with the provisions of Section 2(f) hereof in order to effect a sale, transfer or assignment of Securities
to such pledgee. The Company hereby agrees to execute and deliver such documentation as a pledgee of the Securities may reasonably request
in connection with a pledge of the Securities to such pledgee by an Investor.
(i)
Disclosure of Transactions and Other Material Information. On or before the Disclosure Time (as defined below), the Company shall
(A) issue a press release disclosing all material terms of the transactions contemplated hereby and (B) simultaneously file a Current
Report on Form 8-K describing the terms of the transactions contemplated by the Transaction Documents in the form required by the 1934
Act and attaching the material Transaction Documents (including, without limitation, this Agreement (and all schedules and exhibits to
this Agreement required to be filed under the rules and regulations of the 1934 Act), the form of the Warrants, the form of Lock-Up Agreement,
the form of Voting Agreement and the form of the Registration Rights Agreement as exhibits to such filing (including all attachments),
the “8-K Filing”). From and after the earlier of the filing of the 8-K Filing or the issuance of the press release,
no Buyer shall be in possession of any material, non-public information received from the Company, any of its Subsidiaries or any of
their respective officers, directors, employees, affiliates or agents, that is not disclosed in the 8-K Filing. In addition, effective
upon the filing of the 8-K Filing, the Company acknowledges and agrees that any and all confidentiality or similar obligations under
any agreement, whether written or oral, between the Company, any of its Subsidiaries or any of their respective officers, directors,
affiliates, employees or agents, on the one hand, and any of the Buyers or any of their affiliates, on the other hand, shall terminate.
The Company shall not, and shall cause each of its Subsidiaries and its and each of their respective officers, directors, employees,
affiliates and agents, not to, provide any Buyer with any material, non-public information regarding the Company or any of its Subsidiaries
from and after the date hereof without the express prior written consent of such Buyer. In the event of a breach of any of the foregoing
covenants by the Company, any of its Subsidiaries, or any of its or their respective officers, directors, employees, affiliates and agents,
in addition to any other remedy provided herein or in the Transaction Documents, a Buyer shall have the right to make a public disclosure,
in the form of a press release, public advertisement or otherwise, of such material, non-public information without the prior approval
by the Company, its Subsidiaries, or any of its or their respective officers, directors, employees, affiliates or agents. No Buyer shall
have any liability to the Company, its Subsidiaries, or any of its or their respective officers, directors, employees, affiliates or
agents for any such disclosure. To the extent that the Company delivers any material, non-public information to a Buyer without such
Buyer’s consent, the Company hereby covenants and agrees that such Buyer 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
the Company, any of its Subsidiaries or any of their respective officers, directors, employees, affiliates or agents not to trade on
the basis of, such material, non-public information. Subject to the foregoing, neither the Company, its Subsidiaries nor any Buyer shall
issue any press releases or any other public statements with respect to the transactions contemplated hereby; provided, however,
that the Company shall be entitled, without the prior approval of any Buyer, to make any press release or other public disclosure with
respect to such transactions (i) in substantial conformity with the 8-K Filing and contemporaneously therewith and (ii) as is required
by applicable law and regulations (provided that in the case of clause (i) each Buyer shall be consulted by the Company in connection
with any such press release or other public disclosure prior to its release). Except for the Registration Statement required to be filed
pursuant to the Registration Rights Agreement, without the prior written consent of any applicable Buyer, neither the Company nor any
of its Subsidiaries or affiliates shall disclose the name of such Buyer in any filing, announcement, release or otherwise. As used herein,
“Disclosure Time” means, (i) if this Agreement is signed after 9:00 a.m. (New York City time) and before midnight
(New York City time) on any Trading Day, 9:01 a.m. (New York City time) on the Trading Day immediately following the date hereof, unless
otherwise instructed as to an earlier time by the Placement Agent, or (ii) if this Agreement is signed between midnight (New York City
time) and 9:00 a.m. (New York City time) on any Trading Day, no later than 9:01 a.m. (New York City time) on the date hereof, unless
otherwise instructed as to an earlier time by the Placement Agent.
(j)
Corporate Existence. So long as any Buyer beneficially owns any Warrants, the Company shall maintain its corporate existence and,
except as contemplated and described in the Form S-4 filed by the Company with the SEC on November 12, 2024, shall not be party to any
Fundamental Transaction (as defined in the Warrants) unless the Company is in compliance with the applicable provisions governing Fundamental
Transactions set forth in the Warrants.
(k)
Reservation of Shares. So long as any Buyer owns any Warrants, the Company shall take all action necessary to at all times after
the date hereof have authorized, and reserved for the purpose of issuance, no less than the number of shares of Common Stock issuable
upon exercise of the Warrants then outstanding (without taking into account any limitations on the exercise of the Warrants set forth
in the Warrants). If at any time the number of shares of Common Stock authorized and reserved for issuance is not sufficient to meet
the Required Reserved Amount, the Company will promptly take all corporate action necessary to authorize and reserve a sufficient number
of shares, including, without limitation, if required, calling a special meeting of shareholders to authorize additional shares to meet
the Company’s obligations under Section 3(c), in the case of an insufficient number of authorized shares, obtain shareholder approval
of an increase in such authorized number of shares, and voting the management shares of the Company in favor of an increase in the authorized
shares of the Company to ensure that the number of authorized shares is sufficient to meet the Required Reserved Amount.
(m)
Additional Issuances of Securities.
(i)
For purposes of this Agreement, the following definitions shall apply.
(1)
“Convertible Securities” means any stock or securities (other than Options) convertible into or exercisable or exchangeable
for shares of Common Stock.
(2)
“Common Stock Equivalents” means, collectively, Options and Convertible Securities, and any other securities of the
Company or the Subsidiaries which would entitle the holder thereof to acquire at any time shares of Common Stock, including, without
limitation, any debt, preferred stock, right, option, warrant or other instrument that is at any time convertible into or exercisable
or exchangeable for, or otherwise entitles the holder thereof to receive, shares of Common Stock.
(3)
“Merger Agreement” means that certain the Agreement and Plan of Merger, dated as of October 23, 2024, by and among
the Company, NXU Merger Sub, Inc., a Delaware corporation, NXU Merger Sub, LLC, a Delaware limited liability company, and Verde Bioresins,
Inc., a Delaware corporation.
(4)
“Options” means any rights, warrants or options to subscribe for or purchase Common Stock or Convertible Securities.
(5)
“Placement Agent” means Maxim Group LLC.
(7)
“Variable Rate Transaction” means a transaction in which the Company (i) issues or sells any debt or equity securities
that are convertible into, exchangeable or exercisable for, or include the right to receive additional Common Stock or Common Stock Equivalents
either (A) at a conversion price, exercise price or exchange rate or other price that is based upon and/or varies with the trading prices
of or quotations for the Common Stock at any time after the initial issuance of such debt or equity securities, or (B) with a conversion,
exercise or exchange price that is subject to being reset at some future date after the initial issuance of such debt or equity security
or upon the occurrence of specified or contingent events directly or indirectly related to the business of the Company or the market
for the Common Stock or (ii) enters into, or effects a transaction under, any agreement, including, but not limited to, an equity line
of credit or an “at-the-market offering”, whereby the Company may issue securities at a future determined price regardless
of whether shares pursuant to such agreement have actually been issued and regardless of whether such agreement is subsequently canceled.
(8)
“Excluded Securities” means any Common Stock or Common Stock Equivalents issued or issuable or deemed to be issued
(i) under any Approved Stock Plan (as defined in the Series A Warrants and Series B Warrants), (ii) upon exercise of any Warrants issued
hereunder; provided, that the terms of such Warrants are not amended, modified or changed on or after the date hereof, (iii) upon
conversion, exercise or exchange of any Options or Convertible Securities which are outstanding on the day immediately preceding the
Subscription Date; provided, that such issuance of shares of Common Stock upon exercise of such Options or Convertible Securities
is made pursuant to the terms of such Options or Convertible Securities in effect on the date immediately preceding the date hereof and
such Options or Convertible Securities are not amended, modified or changed on or after the date hereof (except that any amendments,
modifications or changes to such Options or Convertible Securities are required by the terms thereof), (iv) upon a dividend or distribution
to all holders of shares of Common Stock (including pursuant to a rights plan), (v) upon a stock split, reverse stock split, distribution
of bonus shares, combination or other recapitalization events, or (vi) securities issued pursuant to mergers, recapitalizations, reorganizations,
acquisitions or other strategic transactions approved by a majority of the disinterested directors of the Company.
(ii)
From the date hereof until the earlier of (a) the date that is forty five (45) calendar days after the Reset Date and (b) the Business
Day immediately prior to the closing of the transactions contemplated by the Merger Agreement, the Company shall not, directly or indirectly,
file any registration statement with the SEC, or file any amendment or supplement thereto or cause any registration statement or amendment
thereto to be declared effective by the SEC, other than amendments or supplements to registration statements (but not amendments or supplements
to shelf registration statements) that are filed or declared effective with the SEC prior to the date hereof (including, without limitation,
the Company’s Registration Statement on Form S-4 filed pursuant to the Merger Agreement and any supplements or amendments thereto)
or grant any registration rights to any Person that can be exercised prior to such time as set forth above, other than pursuant to the
Registration Rights Agreement or the filing of one or more registration statements on Form S-8 or its then equivalent relating to equity
awards issuable in connection with any compensation plan. From the date hereof until the earlier of (x) the date that is forty five (45)
calendar days after the Reset Date and (y) the Business Day immediately prior to the closing of the transactions contemplated by the
Merger Agreement, the Company shall not, (1) directly or indirectly, offer, sell, grant any option to purchase, or otherwise dispose
of (or announce any offer, sale, grant or any option to purchase or other disposition of) any of its or its Subsidiaries’ Common
Stock or Common Stock Equivalents or (2) be party to any solicitations, negotiations or discussions with regard to the foregoing. From
the date hereof until the earlier of (i) the date that is sixty (60) calendar days after the Reset Date and (ii) the Business Day immediately
prior to the closing of the transactions contemplated by the Merger Agreement, the Company and each Subsidiary shall be prohibited from
entering into an agreement to effect any subsequent placement involving a Variable Rate Transaction. Any Buyer shall be entitled to obtain
injunctive relief against the Company to preclude any such issuance, which remedy shall be in addition to any right to collect damages.
(iii)
The restrictions contained in subsection (ii) of this Section 4(m) shall not apply in connection with the issuance of any Excluded Securities.
(n)
Closing of the Merger. The Company covenants and agrees that the Company shall not consummate the transactions contemplated by
the Merger Agreement until at least ten (10) Trading Days following the Reset Date (as such term is defined in the Series B Warrants).
Any Buyer shall be entitled to obtain injunctive relief against the Company to preclude the Company from consummating the transactions
contemplated by the Merger Agreement, which remedy shall be in addition to any right to collect damages.
(o)
Lock-Up Agreement and Voting Agreement. The Company shall not amend, modify, waive or terminate any provision of any of the Lock-Up
Agreements or Voting Agreements (or any substantially similar lock-up agreements or voting agreements signed by transferees of the initial
parties to the Lock-Up Agreements or Voting Agreements, as the case may be) except to extend the term of the lock-up period under the
Lock-Up Agreements and shall enforce the provisions of each Lock-Up Agreement and Voting Agreement (or any substantially similar lock-up
agreements or voting agreements signed by transferees of the initial parties to the Lock-Up Agreements and Voting Agreements) in accordance
with its terms. If any officer or director that is a party to a Lock-Up Agreement or Voting Agreement (or any substantially similar lock-up
agreements or voting agreements signed by transferees of the initial parties to the Lock-Up Agreements or Voting Agreements) breaches
any provision of a Lock-Up Agreement or Voting Agreement, the Company shall promptly use its best efforts to seek specific performance
of the terms of such Lock-Up Agreement or Voting Agreement, as the case may be (or any substantially similar lock-up agreements or voting
agreements signed by transferees of the initial parties to the Lock-Up Agreements or Voting Agreement).
(p)
Notice of Disqualification Events. The Company will notify the Buyers in writing, prior to the Closing Date of (i) any Disqualification
Event relating to any Issuer Covered Person and (ii) any event that would, with the passage of time, become a Disqualification Event
relating to any Issuer Covered Person.
(q)
FAST Compliance. While any Warrants are outstanding, the Company shall maintain a transfer agent that participates in the DTC
Fast Automated Securities Transfer Program.
(r)
Passive Foreign Investment Company. The Company shall conduct its business, and shall cause its Subsidiaries to conduct their
respective businesses, in such a manner as will ensure that the Company will not be deemed to constitute a passive foreign investment
company within the meaning of Section 1297 of the Code.
(s)
Exercise Procedures. The form of Exercise Notice (as defined in the Warrants) included in the Warrants sets forth the totality
of the procedures required of the Buyers in order to exercise the Warrants. No legal opinion or other information or instructions shall
be required of the Buyers to exercise their Warrants. The Company shall honor exercises of the Warrants and shall deliver the Warrant
Shares in accordance with the terms, conditions and time periods set forth in the Warrants. Without limiting the preceding sentences,
no ink-original Exercise Notice shall be required, nor shall any medallion guarantee (or other type of guarantee or notarization) of
any Exercise Notice form be required in order to exercise the Warrants.
(t)
General Solicitation. None of the Company, any of its affiliates (as defined in Rule 501(b) under the 1933 Act) or any person
acting on behalf of the Company or such affiliate will solicit any offer to buy or offer or sell the Securities by means of any form
of general solicitation or general advertising within the meaning of Regulation D, including: (i) any advertisement, article, notice
or other communication published in any newspaper, magazine or similar medium or broadcast over television or radio; and (ii) any seminar
or meeting whose attendees have been invited by any general solicitation or general advertising.
(u)
Integration. None of the Company, any of its affiliates (as defined in Rule 501(b) under the 1933 Act), or any person acting on
behalf of the Company or such affiliate will sell, offer for sale, or solicit offers to buy or otherwise negotiate in respect of any
security (as defined in the 1933 Act) which will be integrated with the sale of the Securities in a manner which would require the registration
of the Securities under the 1933 Act or require shareholder approval under the rules and regulations of the Principal Market and the
Company will take all action that is appropriate or necessary to assure that its offerings of other securities will not be integrated
for purposes of the 1933 Act or the rules and regulations of the Principal Market, with the issuance of Securities contemplated hereby.
(v)
Notice of Disqualification Events. The Company will notify the Buyers in writing, prior to the Closing Date of (i) any Disqualification
Event relating to any Issuer Covered Person and (ii) any event that would, with the passage of time, become a Disqualification Event
relating to any Issuer Covered Person.
5.
REGISTER; TRANSFER AGENT INSTRUCTIONS.
(a)
Register. The Company shall maintain at its principal executive offices (or such other office or agency of the Company as it may
designate by notice to each holder of Securities), a register for the Warrants in which the Company shall record the name and address
of the Person in whose name the Warrants have been issued (including the name and address of each transferee) and the number of Warrant
Shares issuable upon exercise of the Warrants held by such Person. The Company shall keep the register open and available at all times
during business hours for inspection of any Buyer or its legal representatives.
(b)
Transfer Agent Instructions. The Company shall issue irrevocable instructions to its transfer agent, and any subsequent transfer
agent, in form and substance reasonably acceptable to the Placement Agent (the “Irrevocable Transfer Agent Instructions”)
to issue certificates or credit shares to the applicable balance accounts at DTC, registered in the name of each Buyer or its respective
nominee(s), for the Purchased Shares and the Warrant Shares issued at the Closing or upon exercise of the Warrants in such amounts as
specified from time to time by each Buyer to the Company upon exercise of the Warrants. The Company warrants that no instruction other
than the Irrevocable Transfer Agent Instructions referred to in this Section 5(b), and stop transfer instructions to give effect to Section
2(f) hereof, will be given by the Company to its transfer agent, and that the Securities shall otherwise be freely transferable on the
books and records of the Company as and to the extent provided in this Agreement and the other Transaction Documents. If a Buyer effects
a sale, assignment or transfer of the Securities in accordance with Section 2(f), the Company shall permit the transfer and shall promptly
instruct its transfer agent to issue one or more certificates or credit shares to the applicable balance accounts at DTC in such name
and in such denominations as specified by such Buyer to effect such sale, transfer or assignment. In the event that such sale, assignment
or transfer involves the Purchased Shares or the Warrant Shares sold, assigned or transferred pursuant to an effective registration statement
or pursuant to Rule 144, the transfer agent shall issue such Securities to the Buyer, assignee or transferee, as the case may be, without
any restrictive legend. The Company acknowledges that a breach by it of its obligations hereunder will cause irreparable harm to a Buyer.
Accordingly, the Company acknowledges that the remedy at law for a breach of its obligations under this Section 5(b) will be inadequate
and agrees, in the event of a breach or threatened breach by the Company of the provisions of this Section 5(b), that a Buyer shall be
entitled, in addition to all other available remedies, to an order and/or injunction restraining any breach and requiring immediate issuance
and transfer, without the necessity of showing economic loss and without any bond or other security being required. The Company shall
cause its counsel to issue the legal opinion referred to in the Irrevocable Transfer Agent Instructions to the Company’s transfer
agent on each Effective Date (as defined in the Registration Rights Agreement). Any fees (with respect to the transfer agent, counsel
to the Company or otherwise) associated with the issuance of such opinion or the removal of any legends on any of the Securities shall
be borne by the Company.
6.
CONDITIONS TO THE COMPANY’S OBLIGATION TO SELL.
The
obligation of the Company hereunder to issue and sell the Purchased Shares and the related Warrants to each Buyer at the Closing is subject
to the satisfaction, at or before the Closing Date, of each of the following conditions, provided that these conditions are for the Company’s
sole benefit and may be waived by the Company at any time in its sole discretion by providing each Buyer with prior written notice thereof:
(i)
Such Buyer shall have executed each of the Transaction Documents to which it is a party and delivered the same to the Company.
(ii)
Such Buyer shall have delivered to the Company the Purchase Price, for the Purchased Shares and the related Warrants being purchased
by such Buyer at the Closing by wire transfer of immediately available funds pursuant to the wire instructions provided by the Company.
(iii)
The representations and warranties of such Buyer shall be true and correct as of the date when made and as of the Closing Date as though
made at that time (except for representations and warranties that speak as of a specific date which shall be true and correct as of such
specified date), and such Buyer shall have performed, satisfied and complied in all material respects with the covenants, agreements
and conditions required by this Agreement to be performed, satisfied or complied with by such Buyer at or prior to the Closing Date.
7.
CONDITIONS TO EACH BUYER’S OBLIGATION TO PURCHASE.
The
obligation of each Buyer hereunder to purchase the Purchased Shares and the related Warrants at the Closing is subject to the satisfaction,
at or before the Closing Date, of each of the following conditions, provided that these conditions are for each Buyer’s sole benefit
and may be waived by such Buyer at any time in its sole discretion by providing the Company with prior written notice thereof:
(i)
The Company shall have duly executed and delivered to such Buyer (A) each of the Transaction Documents, (B) the Purchased Shares (allocated
in such amounts as such Buyer shall request), being purchased by such Buyer at the Closing pursuant to this Agreement and (C) the related
Warrants (allocated in such amounts as such Buyer shall request) being purchased by such Buyer at the Closing pursuant to this Agreement.
(ii)
Reserved.
(iii)
The Company shall have delivered to such Buyer a copy of the Irrevocable Transfer Agent Instructions, which instructions shall have been
delivered to and acknowledged in writing by the Company’s transfer agent.
(iv)
The Company shall have delivered to such Buyer a certificate evidencing the formation and good standing of the Company and each of its
Subsidiaries in such entity’s jurisdiction of formation issued by the Secretary of State (or comparable office) of such jurisdiction,
as of a date within ten (10) calendar days prior to the Closing Date.
(v)
Reserved.
(vi)
The Company shall have delivered to such Buyer a certified copy of the Certificate of Incorporation as certified by the Chief Executive
Officer.
(vii)
The Company shall have delivered to such Buyer a certificate, executed by the Secretary of the Company and dated as of the Closing Date,
as to (i) the resolutions consistent with Section 3(b) as adopted by the Company’s Board of Directors in a form reasonably acceptable
to the Placement Agent and (ii) the Certificate of Incorporation and Bylaws, each as in effect at the Closing, in form and substance
reasonably acceptable to the Placement Agent.
(viii)
The representations and warranties of the Company set forth in this Agreement shall be true and correct as of the date hereof and as
of the Closing Date as though made at that time (except for representations and warranties that speak as of a specific date which shall
be true and correct as of such specified date) and the Company shall have performed, satisfied and complied in all material respects
with the covenants, agreements and conditions required by the Transaction Documents to be performed, satisfied or complied with by the
Company at or prior to the Closing Date. Such Buyer shall have received a certificate, executed by the Chief Executive Officer of the
Company, dated as of the Closing Date, to the foregoing effect and in form and substance reasonably acceptable to the Placement Agent.
(ix)
The Company shall have delivered to such Buyer a letter from the Company’s transfer agent certifying the number of shares of Common
Stock outstanding as of a date within two (2) calendar days prior to the Closing Date.
(x)
The Company shall have delivered to each Buyer a lock-up agreement in form and substance reasonably acceptable to the Placement Agent
in favor of the Company executed and delivered by each executive officer and each director of the Company (collectively, the “Lock-Up
Agreements”).
(xi)
The Company shall have delivered to each Buyer a voting agreement in form and substance reasonably acceptable to the Placement Agent
in favor of the Company executed and delivered by each executive officer and each director of the Company (collectively, the “Voting
Agreements”).
(xii)
The Common Stock (I) shall be designated for quotation or listed on the Principal Market and (II) shall not have been suspended, as of
the Closing Date, by the SEC or the Principal Market from trading on the Principal Market nor shall suspension by the SEC or the Principal
Market have been threatened, as of the Closing Date, either (A) in writing by the SEC or the Principal Market or (B) by falling below
the minimum listing maintenance requirements of the Principal Market.
(xiii)
The Company shall have obtained all governmental, regulatory or third party consents and approvals, if any, necessary for the sale of
the Securities.
(xiv)
No statute, rule, regulation, executive order, decree, ruling or injunction shall have been enacted, entered, promulgated or endorsed
by any court or Governmental Entity of competent jurisdiction that prohibits the consummation of any of the transactions contemplated
by the Transaction Documents and since the date of execution of this Agreement, no event or series of events shall have occurred that
reasonably would have or result in a Material Adverse Effect.
(xv)
The Company shall have delivered to such Buyer such other documents relating to the transactions contemplated by this Agreement as such
Buyer or its counsel may reasonably request.
8.
TERMINATION. In the event that the Closing shall not have occurred with respect to a Buyer on or before five (5) Business Days
from the date hereof due to the Company’s or such Buyer’s failure to satisfy the conditions set forth in Sections 6 and 7
above (and the nonbreaching party’s failure to waive such unsatisfied condition(s)), the nonbreaching party shall have the option
to terminate this Agreement with respect to such breaching party at the close of business on such date by delivering a written notice
to that effect to each other party to this Agreement and without liability of any party to any other party.
9.
MISCELLANEOUS.
(a)
Governing Law; Jurisdiction; Jury Trial. All questions concerning the construction, validity, enforcement and interpretation of
this Agreement shall be governed by the internal laws of the State of New York, without giving effect to any choice of law or conflict
of law provision or rule (whether of the State of New York or any other jurisdictions) that would cause the application of the laws of
any jurisdictions other than the State of New York. Each party hereby irrevocably submits to the exclusive jurisdiction of the state
and federal courts sitting in The City of New York, Borough of Manhattan, for the adjudication of any dispute hereunder or in connection
herewith or under any of the other Transaction Documents or with any transaction contemplated hereby or thereby, and hereby irrevocably
waives, and agrees not to assert in any suit, action or proceeding, any claim that it is not personally subject to the jurisdiction of
any such court, that such suit, action or proceeding is brought in an inconvenient forum or that the venue of such suit, action or proceeding
is improper. Each party hereby irrevocably waives personal service of process and consents to process being served in any such suit,
action or proceeding by mailing a copy thereof to such party at the address for such notices to it under this Agreement and agrees that
such service shall constitute good and sufficient service of process and notice thereof. Nothing contained herein shall be deemed to
limit in any way any right to serve process in any manner permitted by law. EACH PARTY HEREBY IRREVOCABLY WAIVES ANY RIGHT IT MAY
HAVE TO, AND AGREES NOT TO REQUEST, A JURY TRIAL FOR THE ADJUDICATION OF ANY DISPUTE HEREUNDER OR UNDER ANY OTHER TRANSACTION DOCUMENT
OR IN CONNECTION WITH OR ARISING OUT OF THIS AGREEMENT, ANY OTHER TRANSACTION DOCUMENT OR ANY TRANSACTION CONTEMPLATED HEREBY OR THEREBY.
(b)
Counterparts. This Agreement may be executed in two or more identical counterparts, all of which shall be considered one and the
same agreement and shall become effective when counterparts have been signed by each party and delivered to the other party. In the event
that any signature is delivered by facsimile transmission or by an e-mail which contains a portable document format (.pdf) file of an
executed signature page, such signature page shall create a valid and binding obligation of the party executing (or on whose behalf such
signature is executed) with the same force and effect as if such signature page were an original thereof.
(c)
Headings. The headings of this Agreement are for convenience of reference and shall not form part of, or affect the interpretation
of, this Agreement.
(d)
Severability. If any provision of this Agreement is prohibited by law or otherwise determined to be invalid or unenforceable by
a court of competent jurisdiction, the provision that would otherwise be prohibited, invalid or unenforceable shall be deemed amended
to apply to the broadest extent that it would be valid and enforceable, and the invalidity or unenforceability of such provision shall
not affect the validity of the remaining provisions of this Agreement so long as this Agreement as so modified continues to express,
without material change, the original intentions of the parties as to the subject matter hereof and the prohibited nature, invalidity
or unenforceability of the provision(s) in question does not substantially impair the respective expectations or reciprocal obligations
of the parties or the practical realization of the benefits that would otherwise be conferred upon the parties. The parties will endeavor
in good faith negotiations to replace the prohibited, invalid or unenforceable provision(s) with a valid provision(s), the effect of
which comes as close as possible to that of the prohibited, invalid or unenforceable provision(s).
(e)
Entire Agreement; Amendments. This Agreement and the other Transaction Documents supersede all other prior oral or written agreements
between the Buyers, the Company, their affiliates and Persons acting on their behalf with respect to the matters discussed herein, and
this Agreement, the other Transaction Documents and the instruments referenced herein and therein contain the entire understanding of
the parties with respect to the matters covered herein and therein and, except as specifically set forth herein or therein, neither the
Company nor any Buyer makes any representation, warranty, covenant or undertaking with respect to such matters. No provision of this
Agreement may be amended other than by an instrument in writing signed by the Company and the holders of at least a majority of the aggregate
amount of Securities issued and issuable hereunder and under the Warrants (without regard to any restriction or limitation on the exercise
of the Warrants contained therein) (the “Required Holders”), and any amendment to this Agreement made in conformity
with the provisions of this Section 9(e) shall be binding on all Buyers and holders of Securities and the Company; provided that any
proposed amendment or waiver that disproportionately, materially and adversely affects the rights and obligations of any Buyer relative
to the comparable rights and obligations of the other Buyers shall require the prior written consent of such adversely affected Buyer.
No provisions hereto may be waived other than by an instrument in writing signed by the party against whom enforcement is sought. No
such amendment shall be effective to the extent that it applies to less than all of the Buyers or holders of the applicable Securities
then outstanding. No consideration shall be offered or paid to any Person to amend or consent to a waiver or modification of any provision
of any of the Transaction Documents unless the same consideration (other than the reimbursement of legal fees) also is offered to all
of the parties to the Transaction Documents, holders of Purchased Shares or holders of the Warrants, as the case may be. The Company
has not, directly or indirectly, made any agreements with any Buyers relating to the terms or conditions of the transactions contemplated
by the Transaction Documents except as set forth in the Transaction Documents. Without limiting the foregoing, the Company confirms that,
except as set forth in this Agreement, no Buyer has made any commitment or promise or has any other obligation to provide any financing
to the Company or otherwise.
(f)
Notices. Any notices, consents, waivers or other communications required or permitted to
be given under the terms of this Agreement or any of the other Transaction Documents must be in writing and will be deemed to have been
delivered: (i) upon receipt, when delivered personally; (ii) upon delivery when sent by facsimile on or prior to 5:00 pm (New York time)
on such date (provided confirmation of transmission is mechanically or electronically generated and kept on file by the sending party);
(iii) one (1) Business Day after they are sent by facsimile after 5:00 pm (New York time) on a day (provided confirmation of transmission
is mechanically or electronically generated and kept on file by the sending party); (iv) upon delivery when sent by electronic mail on
or prior to 5:00 pm (New York time) on such date (provided that the sending party does not receive an automated rejection notice); (v)
one (1) Business Day after they are sent by electronic mail after 5:00 pm (New York time) on such date (provided that the sending party
does not receive an automated rejection notice); or (vi) one (1) Business Day after deposit with an overnight courier service, in each
case properly addressed to the party to receive the same. The addresses, facsimile numbers and e-mail addresses for such communications
shall be:
If
to the Company:
Nxu,
Inc.
1828
N. Higley Road, Suite 116
Mesa,
AZ 85205
Attention:
[_____]
Email:
[______]
If
to a Buyer, to its address, facsimile number and e-mail address set forth on the Schedule of Buyers, with copies to such Buyer’s
representatives as set forth on the Schedule of Buyers, or to such other address, facsimile number and/or e-mail address and/or to the
attention of such other Person as the recipient party has specified by written notice given to each other party five (5) calendar 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 facsimile machine or e-mail containing the
time, date, recipient facsimile number and an image of the first page of such transmission or (C) provided by an overnight courier service
shall be rebuttable evidence of personal service, receipt by facsimile or receipt from an overnight courier service in accordance with
clause (i), (ii) or (iii) above, respectively.
(g)
Successors and Assigns. This Agreement shall be binding upon and inure to the benefit of the parties and their respective successors
and assigns, including any purchasers of the Purchased Shares or the Warrants. The Company shall not assign this Agreement or any rights
or obligations hereunder without the prior written consent of the Required Holders, including by way of a Fundamental Transaction (unless
the Company is in compliance with the applicable provisions governing Fundamental Transactions set forth in the Warrants). A Buyer may
assign some or all of its rights hereunder without the consent of the Company, in which event such assignee shall be deemed to be a Buyer
hereunder with respect to such assigned rights.
(h)
No Third Party Beneficiaries. This Agreement is intended for the benefit of the parties hereto and their respective permitted
successors and assigns, and is not for the benefit of, nor may any provision hereof be enforced by, any other Person, except that (i)
the Placement Agent shall be a third party beneficiary to this Agreement to such extent required by the Placement Agent Agreement by
and between the Company and the Placement Agent dated as of or around the date hereof and (ii) each Indemnitee shall have the right to
enforce the obligations of the Company with respect to Section 9(k).
(i)
Survival. Unless this Agreement is terminated under Section 8, the representations and warranties of the Company and the Buyers
contained in Sections 2 and 3, and the agreements and covenants set forth in Sections 4, 5 and 9 shall survive the Closing. Each Buyer
shall be responsible only for its own representations, warranties, agreements and covenants hereunder.
(j)
Further Assurances. Each party shall do and perform, or cause to be done and performed, all such further acts and things, and
shall execute and deliver all such other agreements, certificates, instruments and documents, as any other party may reasonably request
in order to carry out the intent and accomplish the purposes of this Agreement and the consummation of the transactions contemplated
hereby.
(k)
Indemnification.
(i)
In consideration of each Buyer’s execution and delivery of the Transaction Documents and acquiring the Securities thereunder and
in addition to all of the Company’s other obligations under the Transaction Documents, the Company shall defend, protect, indemnify
and hold harmless each Buyer, such Buyer’s direct or indirect affiliates and investment advisors and managers (the “Buyer
Related Parties”), and all of such Buyer Related Parties’ respective direct or indirect officers, directors, employees,
principals, partners, members, affiliates, advisors and agents (including, without limitation, those retained in connection with the
transactions contemplated by this Agreement) (collectively, and together with the Buyer Related Parties, the “Indemnitees”),
as incurred and with such Indemnified Liabilities (as defined below) to be paid by the Company to the Indemnitees as soon as practicable
but in any event no later than twenty-five (25) calendar days after written demand by Indemnitees therefor to the Company, from and against
any and all actions, causes of action, suits, claims (including causes of action, suits or claims asserted directly by or between an
Indemnitee and the Company), losses, costs, penalties, fees, liabilities and damages, and expenses in connection therewith (irrespective
of whether any such Indemnitee is a party to the action for which indemnification hereunder is sought), and including reasonable attorneys’
fees and disbursements (the “Indemnified Liabilities”), incurred by any Indemnitee as a result of, or arising out
of, or relating to (a) any misrepresentation or breach of any representation or warranty made by the Company in the Transaction Documents
or any other certificate, instrument or document contemplated hereby or thereby, (b) any breach of any covenant, agreement or obligation
of the Company contained in the Transaction Documents or any other certificate, instrument or document contemplated hereby or thereby,
or (c) any action, cause of action, suit, claim, proceeding, investigation, subpoena or similar event brought or made against or involving,
or served upon, such Indemnitee by a third party (including for these purposes a derivative action brought on behalf of the Company)
and arising out of or resulting from or related to (i) the investment in the Securities, the transactions contemplated by the Transaction
Documents or the execution, delivery, performance or enforcement of the Transaction Documents or any other certificate, instrument or
document contemplated hereby or thereby, (ii) any transaction financed or to be financed in whole or in part, directly or indirectly,
with the proceeds of the issuance of the Securities, (iii) the public announcement by the Company of the Transaction Documents and/or
the issuance of the Securities, including any accompanying release of the Company’s financial results, or (iv) the status of such
Indemnitee or holder of the Securities as an investor in the Company pursuant to the transactions contemplated by the Transaction Documents,
except in the event that such cause of action, suit or claim is determined by a court of competent jurisdiction in a full and final resolution
to be the sole result of the gross negligence, willful misconduct, bad faith or fraud by any Indemnitee. To the extent that the foregoing
undertaking by the Company may be unenforceable for any reason, the Company shall make the maximum contribution to the payment and satisfaction
of each of the Indemnified Liabilities that is permissible under applicable law.
(ii)
A claim for indemnification for any matter not involving a Third Party Claim (as defined below) may be asserted by written notice to
the party from whom indemnification is sought; provided, however, that failure to so notify the indemnitor hereunder (the
“Indemnifying Party”) shall not preclude the Indemnitee from any indemnification that it may claim in accordance with
this Section 9(k).
(iii)
Promptly after the receipt by an Indemnitee of notice of any action, cause of action, suit, proceeding, claim, investigation, subpoena
or similar event by a third party that an Indemnitee believes in good faith is an indemnifiable claim hereunder (each, a “Third
Party Claim”), such Indemnitee shall deliver to the Indemnifying Party a written notice of such Third Party Claim (which notice
shall include reasonable detail, to the extent then known, of the basis for the liability and the particular section of the Agreement
breached and a copy of all papers served with respect to such Third Party Claim and any other reasonably necessary documents), and the
Indemnifying Party shall have the right to request to participate in and, with the consent of the Indemnitee (such consent not to be
unreasonably withheld, delayed, or conditioned), to assume control of the defense thereof with counsel selected by Indemnifying Party
and reasonably satisfactory to the Indemnitee; provided, however, that an Indemnitee shall have the right to retain its
own counsel with the fees and expenses of not more than one counsel for all such Indemnitees to be paid by the Indemnifying Party, if,
in the reasonable opinion of counsel retained by the Indemnitee, the representation by such counsel of the Indemnitee and the Indemnifying
Party would be inappropriate due to (i) actual conflicts of interests between such Indemnitee and the Indemnifying Party or (ii) the
nature of such Third Party Claim. The Indemnitee shall reasonably cooperate with the Indemnifying Party in connection with any negotiation
or defense of any such Third Party Claim by the Indemnifying Party and shall furnish to the Indemnifying Party all information reasonably
requested by the Indemnifying Party which relates to such Third Party Claim. The Indemnifying Party shall keep the Indemnitee reasonably
apprised at all times as to the status of the defense or any settlement negotiations with respect thereto. No Indemnifying Party shall
be liable for any settlement of any action, claim or proceeding arising out of any Third Party Claim effected without its prior written
consent, provided, however, that the Indemnifying Party shall not unreasonably withhold, delay or condition its consent.
No Indemnifying Party shall, without the prior written consent of the Indemnitee, consent to entry of any judgment or enter into any
settlement or other compromise which does not include as an unconditional term thereof the giving by the claimant or plaintiff to such
Indemnitee of a release from all liability in respect to such Third Party Claim and such settlement shall not include any admission as
to fault on the part of the Indemnitee. Following indemnification as provided for hereunder, the Indemnifying Party shall be subrogated
to all rights of the Indemnitee with respect to all third parties, firms or corporations relating to the matter for which indemnification
has been made. The failure to deliver written notice to the Indemnifying Party within a reasonable time shall not relieve such Indemnifying
Party of any liability to the Indemnitee under this Section 9(k). For the avoidance of doubt, the obligations of the Indemnitee contained
in this Section 9(k)(iii) shall apply to Third Party Claims only, and shall not apply to direct claims by or between an Indemnitee and
the Company.
(iv)
Notwithstanding any other provision of this Agreement, except in the case of fraud, no party shall be liable for any indirect (including
lost profit), exemplary or punitive damages or any other damages to the extent not reasonably foreseeable arising out of or in connection
with this Agreement or the transactions contemplated hereby (in each case, unless any such damages are awarded pursuant to a Third Party
Claim).
(v) Notwithstanding
any other provision of this Agreement or any provisions of any other Transaction Documents, any and all of the Company’s covenants,
agreements and/or obligations under Section 9(k) of this Agreement shall expire on the Business Day immediately prior to the closing
date of the transactions contemplated by the Merger Agreement.
(l)
No Strict Construction. The language used in this Agreement will be deemed to be the language chosen by the parties to express
their mutual intent, and no rules of strict construction will be applied against any party.
(m)
Remedies. Each Buyer and each holder of the Securities shall have all rights and remedies set forth in the Transaction Documents
and all rights and remedies which such holders have been granted at any time under any other agreement or contract and all of the rights
which such holders have under any law. Any Person having any rights under any provision of this Agreement shall be entitled to enforce
such rights specifically (without posting a bond or other security), to recover damages by reason of any breach of any provision of this
Agreement and to exercise all other rights granted by law. Furthermore, the Company recognizes that in the event that it fails to perform,
observe, or discharge any or all of its obligations under the Transaction Documents, any remedy at law may prove to be inadequate relief
to the Buyers. The Company therefore agrees that the Buyers shall be entitled to seek temporary and permanent injunctive relief in any
such case without the necessity of proving actual damages and without posting a bond or other security.
(n)
Rescission and Withdrawal Right. Notwithstanding anything to the contrary contained in (and without limiting any similar provisions
of) the Transaction Documents, whenever any Buyer exercises a right, election, demand or option under a Transaction Document and the
Company does not timely perform its related obligations within the periods therein provided, then such Buyer may rescind or withdraw,
in its sole discretion from time to time upon written notice to the Company, any relevant notice, demand or election in whole or in part
without prejudice to its future actions and rights.
(o)
Payment Set Aside. To the extent that the Company makes a payment or payments to the Buyers hereunder or pursuant to any of the
other Transaction Documents or the Buyers enforce or exercise their rights hereunder or thereunder, and such payment or payments or the
proceeds of such enforcement or exercise or any part thereof are subsequently invalidated, declared to be fraudulent or preferential,
set aside, recovered from, disgorged by or are required to be refunded, repaid or otherwise restored to the Company, a trustee, receiver
or any other Person under any law (including, without limitation, any bankruptcy law, foreign, state or federal law, common law or equitable
cause of action), then to the extent of any such restoration the obligation or part thereof originally intended to be satisfied shall
be revived and continued in full force and effect as if such payment had not been made or such enforcement or setoff had not occurred.
(p)
Independent Nature of Buyers’ Obligations and Rights. The obligations of each Buyer under any Transaction Document are several
and not joint with the obligations of any other Buyer, and no Buyer shall be responsible in any way for the performance of the obligations
of any other Buyer under any Transaction Document. Nothing contained herein or in any other Transaction Document, and no action taken
by any Buyer pursuant hereto or thereto, shall be deemed to constitute the Buyers as, and the Company acknowledges that the Buyers do
not so constitute, a partnership, an association, a joint venture or any other kind of entity, or create a presumption that the Buyers
are in any way acting in concert or as a group, and the Company shall not assert any such claim with respect to such obligations or the
transactions contemplated by the Transaction Documents and the Company acknowledges that the Buyers are not acting in concert or as a
group with respect to their respective obligations or the transactions contemplated by the Transaction Documents. The Company acknowledges
and each Buyer confirms that it has independently participated in the negotiation of the transaction contemplated hereby with the advice
of its own counsel and advisors. Each Buyer shall be entitled to independently protect and enforce its rights, including, without limitation,
the rights arising out of this Agreement or out of any other Transaction Documents, and it shall not be necessary for any other Buyer
to be joined as an additional party in any proceeding for such purpose.
[Signature
Page Follows]
IN
WITNESS WHEREOF, each Buyer and the Company have caused their respective signature page to this Securities Purchase Agreement to
be duly executed as of the date first written above.
| |
COMPANY: |
| |
|
| |
NXU, INC. |
| |
|
| |
By: |
|
| |
|
Name: |
Mark Hanchett |
| |
|
Title: |
Chief Executive Officer |
IN
WITNESS WHEREOF, each Buyer and the Company have caused their respective signature page to this Securities Purchase Agreement to
be duly executed as of the date first written above.
SCHEDULE
OF BUYERS
| (1) | |
| (2) | | |
| (3) | | |
| (4) | | |
| (5) | | |
| (6) | |
| Buyer | |
| Address,
Facsimile Number and E-mail | | |
| Number
of Purchased Shares | | |
| Number
of Pre-Funded Warrant Shares | | |
| Number
of Series A Warrant Shares | | |
| Purchase
Price | |
| | |
| | | |
| | | |
| | | |
| | | |
| | |
| | |
| | | |
| [ ] | | |
| [ ] | | |
| [ ] | | |
$ | [ ] | |
| | |
| | | |
| [
] | | |
| [
] | | |
| [ ] | | |
$ | [ ] | |
| | |
| | | |
| [ ] | | |
| [ ] | | |
| [ ] | | |
$ | [ ] | |
| | |
| | | |
| | | |
| | | |
| | | |
| | |
| TOTAL | |
| | | |
| [●] | | |
| [●] | | |
| [●] | | |
$ | [●] | |
EXHIBITS
| Exhibit A |
|
Form of Series Pre-Funded Warrants |
| Exhibit B |
|
Form of Series A Warrants |
| Exhibit C |
|
Form of Series B Warrants |
| Exhibit D |
|
Form of Registration Rights Agreement |
Exhibit 10.2
REGISTRATION RIGHTS AGREEMENT
REGISTRATION RIGHTS AGREEMENT
(this “Agreement”), dated as of December 26, 2024, is by and among Nxu, Inc., a Delaware corporation (the “Company”),
and each of the investors listed on the Schedule of Buyers attached hereto (each, a “Buyer” and collectively, the “Buyers”).
WHEREAS:
A. In connection with the Securities
Purchase Agreement by and among the parties hereto dated as of December 26, 2024 (the “Securities Purchase Agreement”),
the Company has agreed, upon the terms and subject to the conditions of the Securities Purchase Agreement, to issue and sell to each Buyer,
units consisting of (i) shares (the “Purchased Shares”) of the Company’s Class A common stock, par value $0.0001
per share (the “Common Stock”) and/or pre-funded warrants to purchase shares of Common Stock (the “Pre-Funded
Warrants”), (ii) Series A Warrants to purchase shares of Common Stock (the “Series A Warrants”) and (iii)
Series B Warrants to purchase shares of Common Stock (the “Series B Warrants”, and collectively with the Pre-Funded
Warrants and Series A Warrants, the “Warrants” and such shares of Common Stock underlying the Warrants, the “Warrant
Shares”).
B. In accordance with the terms
of the Securities Purchase Agreement, the Company has agreed to provide certain registration rights under the Securities Act of 1933,
as amended, and the rules and regulations thereunder, or any similar successor statute (collectively, the “1933 Act”),
and applicable state securities laws.
NOW, THEREFORE, in consideration
of the premises and the mutual covenants contained herein and other good and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, the Company and each of the Buyers hereby agree as follows:
1. Definitions.
Capitalized terms used herein
and not otherwise defined herein shall have the respective meanings set forth in the Securities Purchase Agreement. As used in this Agreement,
the following terms shall have the following meanings:
(a) “Additional Effective
Date” means the date the Additional Registration Statement is declared effective by the SEC.
(b) “Additional Effectiveness
Deadline” means the date which is the earlier of (i) in the event that the Additional Registration Statement (x) is not subject
to a full review by the SEC, the date which is thirty (30) calendar days after the earlier of the Additional Filing Date and the Additional
Filing Deadline or (y) is subject to a full review by the SEC, the date which is sixty (60) calendar days after the earlier of the Additional
Filing Date and the Additional Filing Deadline and (ii) the fifth (5th) Business Day after the date the Company is notified (orally or
in writing, whichever is earlier) by the SEC that such Additional Registration Statement will not be reviewed or will not be subject to
further review; provided, however, that if the Additional Effectiveness Deadline falls on a Saturday, Sunday or other day that the SEC
is closed for business, the Additional Effectiveness Deadline shall be extended to the next Business Day on which the SEC is open for
business.
(c) “Additional Filing
Date” means the date on which the Additional Registration Statement is filed with the SEC.
(d) “Additional Filing
Deadline” means if Cutback Shares are required to be included in any Additional Registration Statement, the later of (i) the
date sixty (60) days after the date substantially all of the Registrable Securities registered under the immediately preceding Registration
Statement are sold and (ii) the date six (6) months from the Initial Effective Date or the most recent Additional Effective Date, as applicable.
(e) “Additional Registrable
Securities” means, (i) any Cutback Shares not previously included on a Registration Statement, and (ii) any capital stock of
the Company issued or issuable with respect to the Purchased Shares, the Warrants, the Warrant Shares or the Cutback Shares, as applicable,
as a result of any share split, dividend, recapitalization, exchange or similar event or otherwise, without regard to any limitations
on exercise of the Warrants, which such capital stock issued or issuable pursuant to this clause (ii) may not be freely resold by the
recipient thereof without registration under the 1933 Act.
(f) “Additional Registration
Statement” means a registration statement or registration statements of the Company filed under the 1933 Act covering the resale
any Additional Registrable Securities.
(g) “Additional Required
Registration Amount” means any Cutback Shares not previously included on a Registration Statement, all subject to adjustment
as provided in Section 2(f), without regard to any limitations on the exercise of the Warrants.
(h) “Business Day”
means any day other than Saturday, Sunday or any other day on which commercial banks in the City of New York are authorized or required
by law to remain closed.
(i) “Closing Date”
shall have the meaning set forth in the Securities Purchase Agreement.
(j) “Cutback Shares”
means any of the Initial Required Registration Amount or the Additional Required Registration Amount of Registrable Securities not included
in all Registration Statements previously declared effective hereunder as a result of a limitation on the maximum number of shares of
Common Stock of the Company permitted to be registered by the staff of the SEC pursuant to Rule 415. For the purpose of determining the
Cutback Shares, in order to determine any applicable Required Registration Amount, unless an Investor gives written notice to the Company
to the contrary with respect to the allocation of its Cutback Shares, first, the Warrant Shares shall be excluded on a pro rata basis
among the Investors until all of the Warrant Shares have been excluded and second, the Purchased Shares shall be excluded on a pro rata
basis among the Investors until all of the Purchased Shares have been excluded.
(k) Intentionally omitted.
(l) “effective”
and “effectiveness” refer to a Registration Statement that has been declared effective by the SEC and is available
for the resale of the Registrable Securities required to be covered thereby.
(m) “Effective Date”
means the Initial Effective Date and the Additional Effective Date, as applicable.
(n) “Effectiveness
Deadline” means the Initial Effectiveness Deadline and the Additional Effectiveness Deadline, as applicable.
(o) “Eligible Market”
means the Principal Market, The New York Stock Exchange, Inc., the NYSE American, The NASDAQ Global Select Market, The Nasdaq
Global Market, OTC QB or OTC QX.
(p) “Filing Deadline”
means the Initial Filing Deadline and the Additional Filing Deadline, as applicable.
(q) “Initial Effective
Date” means the date that the Initial Registration Statement has been declared effective by the SEC.
(r) “Initial Effectiveness
Deadline” means the date which is the earlier of (x) (i) in the event that the Initial Registration Statement is not subject
to a full review by the SEC, fifty (50) calendar days after the Closing Date or (ii) in the event that the Initial Registration Statement
is subject to a full review by the SEC or in the event that the Company is notified by the SEC to refile the Initial Registration Statement
on Form S-1 or S-3, seventy (70) calendar days after the Closing Date and (y) the fifth (5th) Business Day after the date the Company
is notified (orally or in writing, whichever is earlier) by the SEC that such Initial Registration Statement will not be reviewed or will
not be subject to further review; provided, however, that if the Initial Effectiveness Deadline falls on a Saturday, Sunday or other day
that the SEC is closed for business, the Initial Effectiveness Deadline shall be extended to the next Business Day on which the SEC is
open for business.
(s) “Initial Filing
Date” means the date on which the Initial Registration Statement is filed with the SEC.
(t) “Initial Filing
Deadline” means thirty (30) days after the Closing Date.
(u) “Initial Registrable
Securities” means (i) the Purchased Shares issued, (ii) the Warrant Shares issued or issuable upon exercise of the Warrants
and (iii) any capital stock of the Company issued or issuable with respect to the Purchased Shares, the Warrant Shares or the Warrants,
in each case as a result of any share split, dividend, recapitalization, exchange or similar event or otherwise, without regard to any
limitations on the exercise of the Warrants.
(v) “Initial Registration
Statement” means a registration statement or registration statements of the Company filed under the 1933 Act covering the resale
of Initial Registrable Securities.
(w) “Initial Required
Registration Amount” means the sum of (i) the number of Purchased Shares and Pre-Funded Warrants issued and (ii) the maximum
number of Warrant Shares issued and issuable pursuant to the Warrants without giving effect to any limitation on exercise set forth therein
and, assuming with respect to the Series B Warrants, that the Maximum Eligibility Number is determined based on a Reset Price equal to
$0.0524 (as adjusted for share splits, dividends, recapitalizations, reorganizations, reclassification, combinations, reverse share splits
or other similar events occurring after the date hereof), each as of the Trading Day immediately preceding the applicable date of determination
and all subject to adjustment as provided in Section 2(f), without regard to any limitations on the exercise of the Warrants.
(x) “Investor”
means a Buyer or any transferee or assignee thereof to whom a Buyer assigns its rights under this Agreement and who agrees to become bound
by the provisions of this Agreement in accordance with Section 9 and any transferee or assignee thereof to whom a transferee or assignee
assigns its rights under this Agreement and who agrees to become bound by the provisions of this Agreement in accordance with Section
9.
(y) “Maximum Eligibility
Number” shall have the meaning set forth in the Series B Warrants.
(z) “Person”
means an individual, a limited liability company, a partnership, a joint venture, a corporation, a trust, an unincorporated organization
and a government or any department or agency thereof.
(aa) “Principal Market”
means The Nasdaq Capital Market.
(bb) “register,”
“registered,” and “registration” refer to a registration effected by preparing and filing one or
more Registration Statements (as defined below) in compliance with the 1933 Act and pursuant to Rule 415, and the declaration or ordering
of effectiveness of such Registration Statement(s) by the SEC.
(cc) “Registrable
Securities” means the Initial Registrable Securities and the Additional Registrable Securities. Any securities which would otherwise
constitute Registrable Securities under this Agreement shall cease to constitute Registrable Securities (i) once such securities have
been sold pursuant to a Registration Statement or otherwise in a transaction registered under the Securities Act, (ii) when such securities
may be freely resold by such Investor pursuant to Rule 144 under the Securities Act without being subject to current public information
and volume and manner of sale restrictions or (iii) once such securities no longer constitute “restricted securities” within
the meaning of Rule 144.
(dd) “Registration
Statement” means the Initial Registration Statement and the Additional Registration Statement, as applicable.
(ee) “Required Holders”
means the holders of at least a majority of the Registrable Securities.
(ff) “Required Registration
Amount” means either the Initial Required Registration Amount or the Additional Required Registration Amount, as applicable.
(gg) “Reset Price”
shall have the meaning set forth in the Series B Warrants.
(hh) “Rule 415”
means Rule 415 promulgated under the 1933 Act or any successor rule providing for offering securities on a continuous or delayed basis.
(ii) “SEC”
means the United States Securities and Exchange Commission.
(jj) “Trading Day”
means 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 on such day, then on the principal securities exchange or securities market on which the Common Stock is then traded.
2. Registration.
(a) Initial Mandatory Registration.
The Company shall prepare, and, as soon as practicable but in no event later than the Initial Filing Deadline, file with the SEC the Initial
Registration Statement on Form S-1 or S-3 covering the resale of all of the Initial Registrable Securities. The Initial Registration Statement
prepared pursuant hereto shall register for resale at least the number of shares of Common Stock equal to the Initial Required Registration
Amount determined as of the date the Initial Registration Statement is initially filed with the SEC, subject to adjustment as provided
in Section 2(f). The Company shall use its reasonable best efforts to have the Initial Registration Statement declared effective by the
SEC as soon as practicable, but in no event later than the Initial Effectiveness Deadline. By 9:30 a.m. New York time on the second (2nd)
Business Day following the Initial Effective Date, the Company shall file with the SEC in accordance with Rule 424 under the 1933 Act
the final prospectus to be used in connection with sales pursuant to such Initial Registration Statement.
(b) Additional Mandatory
Registrations. The Company shall prepare, and, as soon as practicable but in no event later than the Additional Filing Deadline, file
with the SEC an Additional Registration Statement on Form S-1 or S-3 covering the resale of all of the Additional Registrable Securities
not previously registered on an Additional Registration Statement. To the extent the staff of the SEC does not permit the Additional Required
Registration Amount to be registered on an Additional Registration Statement, the Company shall file Additional Registration Statements
successively trying to register on each such Additional Registration Statement the maximum number of remaining Additional Registrable
Securities until the Additional Required Registration Amount has been registered with the SEC. Each Additional Registration Statement
prepared pursuant hereto shall register for resale at least that number of shares of Common Stock equal to the Additional Required Registration
Amount determined as of the date such Additional Registration Statement is initially filed with the SEC, subject to adjustment as provided
in Section 2(f). The Company shall use its reasonable best efforts to have each Additional Registration Statement declared effective by
the SEC as soon as practicable, but in no event later than the Additional Effectiveness Deadline. No later than the second Business Day
following the Additional Effective Date, the Company shall file with the SEC in accordance with Rule 424 under the 1933 Act the final
prospectus to be used in connection with sales pursuant to such Additional Registration Statement.
(c) Allocation of Registrable
Securities. The initial number of Registrable Securities included in any Registration Statement and any increase or decrease in the
number of Registrable Securities included therein shall be allocated pro rata among the Investors based on the number of Registrable Securities
held by each Investor at the time the Registration Statement covering such initial number of Registrable Securities or increase or decrease
thereof is declared effective by the SEC. In the event that an Investor sells or otherwise transfers any of such Investor’s Registrable
Securities, each transferee shall be allocated a pro rata portion of the then remaining number of Registrable Securities included in such
Registration Statement for such transferor. Any shares of Common Stock included in a Registration Statement and which remain allocated
to any Person which ceases to hold any Registrable Securities covered by such Registration Statement shall be allocated to the remaining
Investors, pro rata based on the number of Registrable Securities then held by such Investors which are covered by such Registration Statement.
In no event shall the Company include any securities other than Registrable Securities on any Registration Statement without the prior
written consent of the Required Holders.
(d) Reserved.
(e) Ineligibility for Form
S-3. In the event that Form S-3 is not available for the registration of the resale of Registrable Securities hereunder, the Company
shall (i) register the resale of the Registrable Securities on Form S-1 or another appropriate form reasonably acceptable to the Required
Holders and (ii) undertake to register the Registrable Securities on Form S-3 as soon as reasonably practicable following the time such
form is available, provided that the Company shall maintain the effectiveness of the Registration Statement then in effect until such
time as a Registration Statement on Form S-3 covering the Registrable Securities has been declared effective by the SEC.
(f) Sufficient Number of
Shares Registered. In the event the number of shares available under a Registration Statement filed pursuant to Section 2(a) or Section
2(b) is insufficient to cover the Required Registration Amount of Registrable Securities required to be covered by such Registration Statement
or an Investor’s allocated portion of the Registrable Securities pursuant to Section 2(c), the Company shall amend the applicable
Registration Statement, or file a new Registration Statement (on the short form available therefor, if applicable), or both, so as to
cover at least the Required Registration Amount as of the Trading Day immediately preceding the date of the filing of such amendment or
new Registration Statement, in each case, as soon as reasonably practicable, but in any event not later than twenty (20) business days
after the necessity therefor arises. The Company shall use its reasonable best efforts to cause such amendment and/or new Registration
Statement to become effective as soon as practicable following the filing thereof.
(g) Effect of Failure to
File and Obtain and Maintain Effectiveness of Registration Statement. If (i) the Initial Registration Statement when declared effective
fails to register the Initial Required Registration Amount of Initial Registrable Securities (a “Registration Failure”),
(ii) a Registration Statement covering all of the Registrable Securities required to be covered thereby and required to be filed by the
Company pursuant to this Agreement is (A) not filed with the SEC on or before the applicable Filing Deadline (a “Filing Failure”)
or (B) not declared effective by the SEC on or before the applicable Effectiveness Deadline, (an “Effectiveness Failure”)
or (iii) on any day after the applicable Effective Date sales of all of the Registrable Securities required to be included on such Registration
Statement cannot otherwise be made (other than during an Allowable Grace Period (as defined in Section 3(r)) pursuant to such Registration
Statement (including, without limitation, a failure to keep such Registration Statement effective, a failure to disclose such information
as is necessary for sales to be made pursuant to such Registration Statement, a failure to register the then requied number of shares
of Common Stock) (a “Maintenance Failure”) then, as relief for the damages to any holder by reason of any such delay
in or reduction of its ability to sell the underlying shares of Common Stock (which remedy shall be exclusive other than specific performance
or the additional obligation of the Company to register any Cutback Shares), the Company shall pay to each holder of Registrable Securities
relating to such Registration Statement an amount in cash equal to one percent (1.0%) of the aggregate Purchase Price (as such term is
defined in the Securities Purchase Agreement) of such Investor’s Registrable Securities whether or not included in such Registration
Statement on each of the following dates: (i) the day of a Registration Failure and on each thirtieth Trading Day thereafter (pro-rated
for periods totaling less than thirty Trading Days) until such Registration Failure is cured, (ii) the day of a Filing Failure and on
each thirtieth Trading Day thereafter (pro-rated for periods totaling less than thirty Trading Days) until such Filing Failure is cured;
(iii) the day of an Effectiveness Failure and on each thirtieth Trading Day thereafter (pro-rated for periods totaling less than thirty
Trading Days) until such Effectiveness Failure is cured; and (iv) the initial day of a Maintenance Failure and on each thirtieth Trading
Day thereafter (pro-rated for periods totaling less than thirty Trading Days) until such Maintenance Failure is cured; provided, that
aggregate amount of all Registration Delay Payments under and for the duration of this Agreement to all holders in the aggregate shall
not exceed five percent (5%) of the aggregate Purchase Price (and such reduced amount will be distributed pro rata amongst such holders
based on the aggregate Purchase Price). Notwithstanding anything to the contrary contained herein, (i) no Registration Failure, Filing
Failure, Effectiveness Failure or Maintenance Failure shall continue to accrue Registration Delay Payments after the end of the Registration
Period or (ii) with respect to any securities which, at the time of such Registration Failure, Filing Failure, Effectiveness Failure or
Maintenance Failure, are no longer Registrable Securities. For the avoidance of doubt, in the event of a simultaneous occurrence of a
Registration Failure, Filing Failure, Maintenance Failure or Effectiveness Failure, the Company shall only be required to make Registration
Delay Payments with respect to one such event. The payments to which a holder shall be entitled pursuant to this Section 2(g) are referred
to herein as “Registration Delay Payments.” Registration Delay Payments shall be paid on the earlier of (I) the dates
set forth above and (II) the third Business Day after the event or failure giving rise to the Registration Delay Payments is cured. In
the event the Company fails to make Registration Delay Payments within seven (7) Business Days after the date payable, such Registration
Delay Payments shall bear interest at the rate of one and one-half percent (1.5%) per month (prorated for partial months) until paid in
full.
3. Related
Obligations.
At such time as the Company
is obligated to file a Registration Statement with the SEC pursuant to Section 2(a), 2(b), 2(e) or 2(f), the Company will use its reasonable
best efforts to effect the registration of the Registrable Securities in accordance with the intended method of disposition thereof and,
pursuant thereto, the Company shall have the following obligations:
(a) The Company shall promptly
prepare and file with the SEC a Registration Statement with respect to the Registrable Securities and use its reasonable best efforts
to cause such Registration Statement relating to the Registrable Securities to become effective as soon as practicable after such filing
(but in no event later than the Effectiveness Deadline). The Company shall keep each Registration Statement effective pursuant to Rule
415 at all times until the earlier of (i) the date as of which the Investors may sell all of the Registrable Securities covered by such
Registration Statement without restriction or limitation pursuant to Rule 144 and without the requirement to be in compliance with Rule
144(c)(1) (or any successor thereto) promulgated under the 1933 Act or (ii) the date on which the Investors shall have sold all of the
Registrable Securities covered by such Registration Statement (the “Registration Period”). The Company shall ensure
that each Registration Statement (including any amendments or supplements thereto and prospectuses contained therein) shall not contain
any untrue statement of a material fact or omit to state a material fact required to be stated therein, or necessary to make the statements
therein (in the case of prospectuses, in the light of the circumstances in which they were made) not misleading. The term “best
efforts” shall mean, among other things, that the Company shall submit to the SEC, within two (2) Business Days after the Company
learns that no review of a particular Registration Statement will be made by the staff of the SEC or that the staff has no further comments
on a particular Registration Statement, as the case may be, a request for acceleration of effectiveness of such Registration Statement
to a time and date not later than two (2) Business Days after the submission of such request, unless the Company is directed to a submit
a request for acceleration of effectiveness of such Registration Statement to a later time and date by the SEC. The Company shall respond
in writing to comments made by the SEC in respect of a Registration Statement as soon as practicable, but in no event later than fifteen
(15) business days after the receipt of comments by or notice from the SEC that an amendment is required in order for a Registration Statement
to be declared effective.
(b) The Company shall prepare
and file with the SEC such amendments (including post-effective amendments) and supplements to a Registration Statement and the prospectus
used in connection with such Registration Statement, which prospectus is to be filed pursuant to Rule 424 promulgated under the 1933 Act,
as may be necessary to keep such Registration Statement effective at all times during the Registration Period, and, during such period,
comply with the provisions of the 1933 Act with respect to the disposition of all Registrable Securities of the Company covered by such
Registration Statement until such time as all of such Registrable Securities shall have been disposed of in accordance with the intended
methods of disposition by the seller or sellers thereof as set forth in such Registration Statement. In the case of amendments and supplements
to a Registration Statement which are required to be filed pursuant to this Agreement (including pursuant to this Section 3(b)) by reason
of the Company filing a report on Form 10-K, Form 10-Q or Form 8-K or any analogous report under the Securities Exchange Act of 1934,
as amended (the “1934 Act”), the Company shall have incorporated such report by reference into such Registration Statement,
if applicable, or shall file such amendments or supplements with the SEC on the same day on which the 1934 Act report is filed which created
the requirement for the Company to amend or supplement such Registration Statement.
(c) Reserved.
(d) The Company shall furnish
to each Investor whose Registrable Securities are included in any Registration Statement, without charge, (i) promptly after the same
is prepared and filed with the SEC, at least one copy (which may be electronic copy) of such Registration Statement and any amendment(s)
thereto, including financial statements and schedules, but, unless otherwise requested by an Investor, excluding documents incorporated
therein by reference, exhibits and any preliminary prospectus, (ii) upon the effectiveness of any Registration Statement, a copy (which
may be electronic copy) of the final prospectus relating to such Registration Statement and all amendments and supplements thereto (or
such other number of copies as such Investor may reasonably request) (but, for the avoidance of doubt, excluding documents incorporated
by reference therein) and (iii) such other documents, including copies of any preliminary or final prospectus or document incorporated
by reference therein, as such Investor may reasonably request from time to time in order to facilitate the disposition of the Registrable
Securities owned by such Investor.
(e) The Company shall use
its reasonable best efforts to (i) register and qualify, unless an exemption from registration and qualification applies, the resale by
Investors of the Registrable Securities covered by a Registration Statement under such other securities or “blue sky” laws
of all applicable jurisdictions in the United States, (ii) prepare and file in those jurisdictions such amendments (including post-effective
amendments) and supplements to such registrations and qualifications as may be necessary to maintain the effectiveness thereof during
the Registration Period, (iii) take such other actions as may be necessary to maintain such registrations and qualifications in effect
at all times during the Registration Period, and (iv) take all other actions reasonably necessary or advisable to qualify the Registrable
Securities for sale in such jurisdictions; provided, however, that the Company shall not be required in connection therewith or as a condition
thereto to (x) qualify to do business in any jurisdiction where it would not otherwise be required to qualify but for this Section 3(e),
(y) subject itself to general taxation in any such jurisdiction, or (z) file a general consent to service of process in any such jurisdiction.
The Company shall promptly notify each Investor who holds Registrable Securities of the receipt by the Company of any notification with
respect to the suspension of the registration or qualification of any of the Registrable Securities for sale under the securities or “blue
sky” laws of any jurisdiction in the United States or its receipt of actual notice of the initiation or threatening of any proceeding
for such purpose.
(f) The Company shall notify
each Investor in writing of the happening of any event, as promptly as practicable after becoming aware of such event but in any event
on the same Trading Day as such event, as a result of which the prospectus included in a Registration Statement, as then in effect, includes
an untrue statement of a material fact or omission to state a material fact required to be stated therein or necessary to make the statements
therein, in the light of the circumstances under which they were made, not misleading (provided that in no event shall such notice contain
any material, nonpublic information), and, subject to Section 3(r), promptly prepare a supplement or amendment to such Registration Statement
to correct such untrue statement or omission, and deliver one copy (which may be electronic copy) of such supplement or amendment to each
Investor (or such other number of copies as such Investor may reasonably request). The Company shall also promptly notify each Investor
in writing (i) when a prospectus or any prospectus supplement or post-effective amendment has been filed, and when a Registration Statement
or any post-effective amendment has become effective (notification of such effectiveness shall be delivered to each Investor by facsimile
or email on the same day of such effectiveness and by overnight mail) (in each case, excluding, for the avoidance of doubt, the filing
of any document incorporated by reference therein),, (ii) of any request by the SEC for amendments or supplements to a Registration Statement
or related prospectus or related information and (iii) of the Company’s reasonable determination that a post-effective amendment
to a Registration Statement would be appropriate. By 9:30 a.m. New York City time on the date following the date any post-effective amendment
has become effective, the Company shall file with the SEC in accordance with Rule 424 under the 1933 Act the final prospectus to be used
in connection with sales pursuant to such Registration Statement.
(g) The Company shall use
its reasonable best efforts to prevent the issuance of any stop order or other suspension of effectiveness of a Registration Statement,
or the suspension of the qualification of any of the Registrable Securities for sale in any jurisdiction and, if such an order or suspension
is issued, to obtain the withdrawal of such order or suspension at the earliest possible moment and to notify each Investor who holds
Registrable Securities being sold of the issuance of such order and the resolution thereof or its receipt of actual notice of the initiation
or threat of any proceeding for such purpose.
(h) If any Investor is required
under applicable securities laws or by the SEC to be named in the Registration Statement as an underwriter , at the reasonable request
of such Investor, the Company shall use commercially reasonable efforts to furnish to such Investor, on the date of the effectiveness
of the Registration Statement and thereafter from time to time on such dates as an Investor may reasonably request (i) a letter, dated
such date, from the Company’s independent certified public accountants in form and substance as is customarily given by independent
certified public accountants to underwriters in an underwritten public offering, addressed to the Investors, and (ii) an opinion, dated
as of such date, of counsel representing the Company for purposes of such Registration Statement, in form, scope and substance as is customarily
given in an underwritten public offering, addressed to the Investors, in each case subject to delivery by the Investor to the Company
of a written representation that the Investor is otherwise conducting a due diligence investigation substantially consistent with the
type of due diligence investigation customarily undertaken.by underwriters in an underwritten public offering.
(i) If any Investor is required
under applicable securities laws to be described in the Registration Statement as an underwriter or an Investor believes that it could
reasonably be deemed to be an underwriter of Registrable Securities, the Company shall make available for inspection by such Investor
all pertinent financial and other records, and pertinent corporate documents and properties of the Company (collectively, the “Records”),
as shall be reasonably deemed necessary by such Investor, and cause the Company’s officers, directors and employees to supply all
information which any Investor may reasonably request; provided, however, that each Investor shall agree to hold in strict confidence
and shall not make any disclosure (except to an Investor) or use of any Record or other information which the Company determines in good
faith to be confidential, and of which determination the Investors are so notified, unless (a) the disclosure of such Records is necessary
to avoid or correct a misstatement or omission in any Registration Statement or is otherwise required under the 1933 Act, (b) the release
of such Records is ordered pursuant to a final, non-appealable subpoena or order from a court or government body of competent jurisdiction,
or (c) the information in such Records has been made generally available to the public other than by disclosure in violation of this Agreement.
Each Investor agrees that it shall, upon learning that disclosure of such Records is sought in or by a court or governmental body of competent
jurisdiction or through other means, give prompt notice to the Company and allow the Company, at its expense, to undertake appropriate
action to prevent disclosure of, or to obtain a protective order for, the Records deemed confidential. Nothing herein (or in any other
confidentiality agreement between the Company and any Investor) shall be deemed to limit the Investors’ ability to sell Registrable
Securities in a manner which is otherwise consistent with applicable laws and regulations.
(j) Unless otherwise consented
to in writing by the Investor, the Company shall hold in confidence and not make any disclosure of information concerning an Investor
provided to the Company unless (i) disclosure of such information is necessary to comply with federal or state securities laws, (ii) the
disclosure of such information is necessary to avoid or correct a misstatement or omission in any Registration Statement, (iii) the release
of such information is ordered pursuant to a subpoena or other final, non-appealable order from a court or governmental body of competent
jurisdiction, or (iv) such information has been made generally available to the public other than by disclosure in violation of this Agreement
or any other agreement. The Company agrees that it shall, upon learning that disclosure of such information concerning an Investor is
sought in or by a court or governmental body of competent jurisdiction or through other means, give prompt written notice to such Investor
and allow such Investor, at the Investor’s expense, to undertake appropriate action to prevent disclosure of, or to obtain a protective
order for, such information.
(k) The Company shall use
its reasonable best efforts either to (i) cause all of the Registrable Securities covered by a Registration Statement to be listed on
each securities exchange on which securities of the same class or series issued by the Company are then listed, if any, if the listing
of such Registrable Securities is then permitted under the rules of such exchange or (ii) secure the inclusion for quotation of all of
the Registrable Securities on the Principal Market or (iii) if, despite the Company’s reasonable best efforts, the Company is unsuccessful
in satisfying the preceding clauses (i) and (ii), to secure the inclusion for quotation on an Eligible Market for such Registrable Securities
and, without limiting the generality of the foregoing, to use its reasonable best efforts to arrange for at least two market makers to
register with the Financial Industry Regulatory Authority, Inc. as such with respect to such Registrable Securities. The Company shall
pay all fees and expenses in connection with satisfying its obligation under this Section 3(k).
(l) The Company shall cooperate
with the Investors who hold Registrable Securities being offered and, to the extent applicable, facilitate the timely preparation and
delivery of certificates (not bearing any restrictive legend) representing the Registrable Securities sold pursuant to a Registration
Statement and enable such certificates to be in such denominations or amounts, as the case may be, as the Investors may reasonably request
and registered in such names as the Investors may request.
(m) If requested by an Investor,
the Company shall as soon as practicable (i) incorporate in a prospectus supplement or post-effective amendment such information as an
Investor reasonably requests to be included therein relating to the sale and distribution of Registrable Securities, including, without
limitation, information with respect to the number of Registrable Securities being offered or sold, the purchase price being paid therefor
and any other terms of the offering of the Registrable Securities to be sold in such offering; (ii) make all required filings of such
prospectus supplement or post-effective amendment after being notified of the matters to be incorporated in such prospectus supplement
or post-effective amendment; and (iii) supplement or make amendments to any Registration Statement if reasonably requested by an Investor
holding any Registrable Securities.
(n) The Company shall use
its reasonable best efforts to cause the Registrable Securities covered by a Registration Statement to be registered with or approved
by such other governmental agencies or authorities as may be necessary to consummate the disposition of such Registrable Securities.
(o) The Company shall make
generally available to its security holders as soon as practical, but not later than ninety (90) days after the close of the period covered
thereby, an earnings statement (in form complying with, and in the manner provided by, the provisions of Rule 158 under the 1933 Act)
covering a twelve-month period beginning not later than the first day of the Company’s fiscal quarter next following the applicable
Effective Date of a Registration Statement.
(p) The Company shall otherwise
use its reasonable best efforts to comply with all applicable rules and regulations of the SEC in connection with any registration hereunder.
(q) Within one (1) Business
Day after a Registration Statement which covers Registrable Securities is declared effective by the SEC, the Company shall deliver, and,
if required by the Company’s transfer agent, shall cause legal counsel for the Company to deliver, to the transfer agent for such
Registrable Securities (with copies to the Investors whose Registrable Securities are included in such Registration Statement) confirmation
that such Registration Statement has been declared effective by the SEC.
(r) Notwithstanding anything
to the contrary herein, at any time after the Effective Date, the Company may delay, for any reason, the disclosure of material, non-public
information concerning the Company the disclosure of which at the time is not, in the good faith opinion of the Board of Directors of
the Company (a “Grace Period”); provided, that the Company shall promptly (i) notify the Investors in writing of the
existence of material, non-public information giving rise to a Grace Period (provided that in each notice the Company will not disclose
the content of such material, non-public information to the Investors) and the date on which the Grace Period will begin, and (ii) notify
the Investors in writing of the date on which the Grace Period ends; and, provided further, that no Grace Period shall exceed sixty (60)
consecutive days and during any three hundred sixty five (365) day period such Grace Periods shall not exceed an aggregate of ninety (90)
days and the first day of any Grace Period must be at least five (5) Trading Days after the last day of any prior Grace Period (each,
an “Allowable Grace Period”). For purposes of determining the length of a Grace Period above, the Grace Period shall
begin on and include the date the Investors receive the notice referred to in clause (i) and shall end on and include the later of the
date the Investors receive the notice referred to in clause (ii) and the date referred to in such notice. Upon expiration of the Grace
Period, the Company shall again be bound by the first sentence of Section 3(f) with respect to the information giving rise thereto unless
such material, non-public information is no longer applicable. Notwithstanding anything to the contrary, the Company shall cause its transfer
agent to deliver unlegended shares of Common Stock to a transferee of an Investor in accordance with the terms of the Securities Purchase
Agreement in connection with any sale of Registrable Securities with respect to which an Investor has entered into a contract for sale,
prior to the Investor’s receipt of the notice of a Grace Period and for which the Investor has not yet settled.
(s) Neither the Company nor
any Subsidiary or affiliate thereof shall identify any Investor as an underwriter in any public disclosure or filing with the SEC, the
Principal Market or any Eligible Market without such Investor’s prior written consent, and any Investor being deemed an underwriter
by the SEC shall not relieve the Company of any obligations it has under this Agreement or any other Transaction Document (as defined
in the Securities Purchase Agreement) (provided, however, for the avoidance of doubt, any Investor deemed to be an underwriter and who
elects not to be included in any Registration Statement shall not be entitled to Registration Delay Payments pursuant to Section 2(g)
of this Agreement).
(t) Neither the Company nor
any of its Subsidiaries has entered, as of the date hereof, nor shall the Company or any of its Subsidiaries, on or after the date of
this Agreement, enter into any agreement with respect to its securities, that would have the effect of materially impairing the rights
granted to the Buyers in this Agreement or otherwise conflicts in any material respect with the provisions hereof.
4. Obligations
of the Investors.
(a) At least five (5) Business
Days prior to the Initial Filing Date of a Registration Statement, the Company shall notify each Investor in writing of the information
the Company requires from each such Investor if such Investor elects to have any of such Investor’s Registrable Securities included
in such Registration Statement. It shall be a condition precedent to the obligations of the Company to complete any registration pursuant
to this Agreement with respect to the Registrable Securities of a particular Investor that such Investor shall furnish to the Company
such information regarding itself, the Registrable Securities held by it and the intended method of disposition of the Registrable Securities
held by it as shall be reasonably required to effect and maintain the effectiveness of the registration of such Registrable Securities
and shall execute such documents in connection with such registration as the Company may reasonably request.
(b) Each Investor, by such
Investor’s acceptance of the Registrable Securities, agrees to cooperate with the Company as reasonably requested by the Company
in connection with the preparation and filing of any Registration Statement hereunder, unless such Investor has notified the Company in
writing of such Investor’s election to exclude all of such Investor’s Registrable Securities from such Registration Statement.
(c) Each Investor agrees that,
upon receipt of any notice from the Company of the happening of any event of the kind described in the first sentence of Section 3(f),
such Investor will immediately discontinue disposition of Registrable Securities pursuant to any Registration Statement(s) covering such
Registrable Securities until such Investor’s receipt of copies of the supplemented or amended prospectus as contemplated by the
first sentence of Section 3(f) or receipt of notice that no supplement or amendment is required. Notwithstanding anything to the contrary,
the Company shall cause its transfer agent to deliver unlegended shares of Common Stock to a transferee of an Investor in accordance with
the terms of the Securities Purchase Agreement in connection with any sale of Registrable Securities with respect to which an Investor
has entered into a contract for sale prior to the Investor’s receipt of a notice from the Company of the happening of any event
of the kind described in the first sentence of Section 3(f) and for which the Investor has not yet settled.
(d) Each Investor covenants
and agrees that it will comply with the prospectus delivery requirements of the 1933 Act as applicable to it or an exemption therefrom,
and all other laws applicable to it, in connection with sales of Registrable Securities pursuant to the Registration Statement.
5. Expenses
of Registration.
All reasonable expenses (other
than underwriting discounts and commissions and fees and disbursements of counsel or other advisors to, and any other expenses for the
account of, any Investor) incurred in connection with registrations, filings or qualifications pursuant to Sections 2 and 3, including,
without limitation, all registration, listing and qualifications fees, printers and accounting fees, and fees and disbursements of counsel
for the Company shall be paid by the Company.
6. Indemnification.
In the event any Registrable
Securities are included in a Registration Statement under this Agreement:
(a) To the fullest extent
permitted by law, the Company will, and hereby does, indemnify, hold harmless and defend each Investor, the directors, officers, partners,
members, employees, agents, representatives of, and each Person, if any, who controls any Investor within the meaning of the 1933 Act
or the 1934 Act (each, an “Indemnified Person”), against any losses, claims (including causes of action, suits or claims
asserted directly by or between an Indemnitee and the Company), damages, liabilities, judgments, fines, penalties, charges, costs, reasonable
attorneys’ fees, amounts paid in settlement or expenses, joint or several (collectively, “Claims”), incurred
in investigating, preparing or defending any action, claim, suit, inquiry, proceeding, investigation or appeal taken from the foregoing
by or before any court or governmental, administrative or other regulatory agency, body or the SEC, whether pending or threatened, whether
or not an indemnified party is or may be a party thereto (“Indemnified Damages”), to which any of them may become subject
insofar as such Claims (or actions or proceedings, whether commenced or threatened, in respect thereof) arise out of or are based upon:
(i) any untrue statement or alleged untrue statement of a material fact in a Registration Statement or any post-effective amendment thereto,
or the omission or alleged omission to state a material fact required to be stated therein or necessary to make the statements therein
not misleading, (ii) any untrue statement or alleged untrue statement of a material fact contained in the final prospectus (as amended
or supplemented, if the Company files any amendment thereof or supplement thereto with the SEC) or the omission or alleged omission to
state therein any material fact necessary to make the statements made therein, in light of the circumstances under which the statements
therein were made, not misleading, (iii) any violation by the Company of the 1933 Act, the 1934 Act, any other law, including, without
limitation, any state securities law, or any rule or regulation thereunder relating to the offer or sale of the Registrable Securities
pursuant to a Registration Statement (the matters in the foregoing clauses (i) through (iii) being, collectively, “Violations”).
Subject to Section 6(c), the Company shall reimburse the Indemnified Persons, promptly as such expenses are incurred and are due and payable,
for any legal fees or other reasonable expenses incurred by them in connection with investigating or defending any such Claim. Notwithstanding
anything to the contrary contained herein, the indemnification agreement contained in this Section 6(a): (i) shall not apply to a Claim
by an Indemnified Person arising out of or based upon a Violation which occurs in reliance upon and in conformity with information furnished
in writing to the Company by such Indemnified Person expressly for use in connection with the preparation of the Registration Statement
or any such amendment thereof or supplement thereto, if such prospectus was timely made available by the Company pursuant to Section 3(d);
(ii) shall not apply to any Claim by an Indemnified Person arising out of or based upon a Violation where the applicable Investor(s) failed
to comply with its obligations under Section 4(c) or 4(d) of this Agreement in connection with the transaction(s) or event(s) giving rise
to such Claim; (iii) shall not apply to amounts paid in settlement of any Claim if such settlement is effected without the prior written
consent of the Company, which consent shall not be unreasonably withheld or delayed; and (iv) shall not apply to amounts paid in settlement
of any direct Claim by or between an Indemnitee and the Company. Such indemnity shall remain in full force and effect regardless of any
investigation made by or on behalf of the Indemnified Person and shall survive the transfer of the Registrable Securities by the Investors
pursuant to Section 9.
(b) In connection with any
Registration Statement in which an Investor is participating, each such Investor agrees to severally and not jointly indemnify, hold harmless
and defend, to the same extent and in the same manner as is set forth in Section 6(a), the Company, each of its directors, each of its
officers who signs the Registration Statement and each Person, if any, who controls the Company within the meaning of the 1933 Act or
the 1934 Act (each, an “Indemnified Party”), against any Claim or Indemnified Damages to which any of them may become
subject, under the 1933 Act, the 1934 Act or otherwise, insofar as such Claim or Indemnified Damages arise out of or are based upon any
Violation, in each case to the extent, and only to the extent, that such Violation occurs in reliance upon and in conformity with written
information furnished to the Company by such Investor expressly for use in connection with such Registration Statement; and, subject to
Section 6(c), such Investor shall reimburse the Indemnified Party for any legal or other expenses reasonably incurred by an Indemnified
Party in connection with investigating or defending any such Claim; provided, however, that the indemnity agreement contained in this
Section 6(b) and the agreement with respect to contribution contained in Section 7 shall not apply to amounts paid in settlement of any
Claim if such settlement is effected without the prior written consent of such Investor, which consent shall not be unreasonably withheld
or delayed; provided, further, however, that the Investor shall be liable under this Section 6(b) for only that amount of a Claim or Indemnified
Damages as does not exceed the net proceeds to such Investor as a result of the sale of Registrable Securities pursuant to such Registration
Statement. Such indemnity shall remain in full force and effect regardless of any investigation made by or on behalf of such Indemnified
Party and shall survive the transfer of the Registrable Securities by the Investors pursuant to Section 9.
(c) Promptly after receipt
by an Indemnified Person or Indemnified Party under this Section 6 of notice of the commencement of any action or proceeding (including
any governmental action or proceeding) involving a Claim, such Indemnified Person or Indemnified Party shall, if a Claim in respect thereof
is to be made against any indemnifying party under this Section 6, deliver to the indemnifying party a written notice of the commencement
thereof, and, except in the case of a direct Claim, for which the remainder of this Section 6(c) shall not apply, the indemnifying party
shall have the right to participate in, and, to the extent the indemnifying party so desires, jointly with any other indemnifying party
similarly noticed, to assume control of the defense thereof with counsel mutually satisfactory to the indemnifying party and the Indemnified
Person or the Indemnified Party, as the case may be; provided, however, that an Indemnified Person or Indemnified Party shall have the
right to retain its own counsel with the fees and expenses of not more than one counsel for all such Indemnified Person or Indemnified
Party to be paid by the indemnifying party, if, in the reasonable opinion of counsel retained by the Indemnified Person or Indemnified
Party, as applicable, the representation by such counsel of the Indemnified Person or Indemnified Party, as the case may be, and the indemnifying
party would be inappropriate due to actual differing interests between such Indemnified Person or Indemnified Party and any other party
represented by such counsel in such proceeding. In the case of an Indemnified Person, legal counsel referred to in the immediately preceding
sentence shall be selected by the Investors holding at least a majority in interest of the Registrable Securities included in the Registration
Statement to which the Claim relates. The Indemnified Party or Indemnified Person shall reasonably cooperate with the indemnifying party
in connection with any negotiation or defense of any such action or Claim by the indemnifying party and shall furnish to the indemnifying
party all information reasonably available to the Indemnified Party or Indemnified Person which relates to such action or Claim. The indemnifying
party shall keep the Indemnified Party or Indemnified Person fully apprised at all times as to the status of the defense or any settlement
negotiations with respect thereto. No indemnifying party shall be liable for any settlement of any action, claim or proceeding effected
without its prior written consent, provided, however, that the indemnifying party shall not unreasonably withhold, delay or condition
its consent. No indemnifying party shall, without the prior written consent of the Indemnified Party or Indemnified Person, consent to
entry of any judgment or enter into any settlement or other compromise which does not include as an unconditional term thereof the giving
by the claimant or plaintiff to such Indemnified Party or Indemnified Person of a release from all liability in respect to such Claim
or litigation and such settlement shall not include any admission as to fault on the part of the Indemnified Party or Indemnified Person.
Following indemnification as provided for hereunder, the indemnifying party shall be subrogated to all rights of the Indemnified Party
or Indemnified Person with respect to all third parties, firms or corporations relating to the matter for which indemnification has been
made. The failure to deliver written notice to the indemnifying party within a reasonable time of the commencement of any such action
shall not relieve such indemnifying party of any liability to the Indemnified Person or Indemnified Party under this Section 6, except
to the extent that the indemnifying party is prejudiced in its ability to defend such action by such lack of notice.
(d) The indemnification required
by this Section 6 shall be made by periodic payments of the amount thereof during the course of the investigation or defense, as and when
bills are received or Indemnified Damages are incurred.
(e) The indemnity agreements
contained herein shall be in addition to (i) any cause of action or similar right of the Indemnified Party or Indemnified Person against
the indemnifying party or others, and (ii) any liabilities the indemnifying party may be subject to pursuant to the law.
7. Contribution.
To the extent any indemnification
by an indemnifying party is prohibited or limited by law, the indemnifying party agrees to make the maximum contribution with respect
to any amounts for which it would otherwise be liable under Section 6 to the fullest extent permitted by law; provided, however, that:
(i) no Person involved in the sale of Registrable Securities which Person is guilty of fraudulent misrepresentation (within the meaning
of Section 11(f) of the 1933 Act) in connection with such sale shall be entitled to contribution from any Person involved in such sale
of Registrable Securities who was not guilty of fraudulent misrepresentation; and (ii) contribution by any seller of Registrable Securities
shall be limited in amount to the amount of net proceeds received by such seller from the sale of such Registrable Securities pursuant
to such Registration Statement.
8. Reports
Under the 1934 Act.
With a view to making available
to the Investors the benefits of Rule 144 promulgated under the 1933 Act or any other similar rule or regulation of the SEC that may at
any time permit the Investors to sell securities of the Company to the public without registration (“Rule 144”), the
Company agrees to:
(a) make and keep public information
available, as those terms are understood and defined in Rule 144;
(b) file with the SEC in a
timely manner (giving effect to permitted extensions pursuant to Rule 12b-25 under the 1934 Act or any successor provision thereto) all
reports and other documents required of the Company under the 1933 Act and the 1934 Act so long as the Company remains subject to such
requirements and the filing of such reports and other documents is required for the applicable provisions of Rule 144; and
(c) furnish to each Investor
so long as such Investor owns Registrable Securities, promptly upon request, (i) a written statement by the Company, if true, that it
has complied with the reporting requirements of the 1934 Act necessary to permit the availability of Rule 144, (ii) a copy of the most
recent annual or quarterly report of the Company and such other reports and documents so filed by the Company and (iii) such other information
as may be reasonably requested to permit the Investors to sell such securities pursuant to Rule 144 without registration.
9. Assignment
of Registration Rights.
The rights under this Agreement
shall be automatically assignable by the Investors to any transferee of all or any portion of such Investor’s Registrable Securities
if: (i) the Investor agrees in writing with the transferee or assignee to assign such rights, and a copy of such agreement is furnished
to the Company within a reasonable time after such assignment; (ii) the Company is, within a reasonable time after such transfer or assignment,
furnished with written notice of (a) the name and address of such transferee or assignee, and (b) the securities with respect to which
such registration rights are being transferred or assigned; (iii) immediately following such transfer or assignment the further disposition
of such securities by the transferee or assignee is restricted under the 1933 Act or applicable state securities laws; (iv) at or before
the time the Company receives the written notice contemplated by clause (ii) of this sentence the transferee or assignee agrees in writing
with the Company to be bound by all of the provisions contained herein and in the Securities Purchase Agreement; and (v) such transfer
shall have been made in accordance with the applicable requirements of the Securities Purchase Agreement.
10. Amendment
of Registration Rights.
Provisions of this Agreement
may be amended and the observance thereof may be waived (either generally or in a particular instance and either retroactively or prospectively),
only with the written consent of the Company and the Required Holders; provided that any such amendment or waiver that complies with the
foregoing but that disproportionately, materially and adversely affects the rights and obligations of any Investor relative to the comparable
rights and obligations of the other Investors shall require the prior written consent of such adversely affected Investor. Any amendment
or waiver effected in accordance with this Section 10 shall be binding upon each Investor and the Company. No such amendment shall be
effective to the extent that it applies to less than all of the holders of the Registrable Securities. No consideration shall be offered
or paid to any Person to amend or consent to a waiver or modification of any provision of this Agreement unless the same consideration
(other than the reimbursement of legal fees) also is offered to all of the parties to this Agreement.
11. Miscellaneous.
(a) A Person is deemed to
be a holder of Registrable Securities whenever such Person owns or is deemed to own of record such Registrable Securities. If the Company
receives conflicting instructions, notices or elections from two or more Persons with respect to the same Registrable Securities, the
Company shall act upon the basis of instructions, notice or election received from such record owner of such Registrable Securities.
(b) Any notices, consents,
waivers or other communications required or permitted to be given under the terms of this Agreement must be in writing and will be deemed
to have been delivered: (i) upon receipt, when delivered personally; (ii) upon delivery, when sent by facsimile (provided confirmation
of transmission is mechanically or electronically generated and kept on file by the sending party), (iii) upon delivery, when sent by
electronic mail (provided that the sending party does not receive an automated rejection notice); or (iv) one Business Day after deposit
with a nationally recognized overnight delivery service, in each case properly addressed to the party to receive the same. The addresses,
facsimile numbers and e-mail addresses for such communications shall be:
If to the Company:
Nxu, Inc.
1828 N. Higley Road, Suite 116
Mesa, AZ 85205
Attention: [_____]
Email: [______]
If to a Buyer, to its address, facsimile number
or email address set forth on the Schedule of Buyers attached hereto, with copies to such Buyer’s representatives as set forth on
the Schedule of Buyers, or to such other address, facsimile number and/or email address to the attention of such other Person as the recipient
party has specified by written notice given to each other party five (5) days prior to the effectiveness of such change. Written confirmation
of receipt (A) given by the recipient of such notice, consent, waiver or other communication, (B) mechanically or electronically generated
by the sender’s facsimile machine or e-mail transmission containing the time, date, recipient facsimile number or e-mail address
and an image of the first page of such transmission or (C) provided by a courier or overnight courier service shall be rebuttable evidence
of personal service, receipt by facsimile or receipt from a nationally recognized overnight delivery service in accordance with clause
(i), (ii) or (iii) above, respectively.
(c) Failure of any party to
exercise any right or remedy under this Agreement or otherwise, or delay by a party in exercising such right or remedy, shall not operate
as a waiver thereof.
(d) All questions concerning
the construction, validity, enforcement and interpretation of this Agreement shall be governed by the internal laws of the State of New
York, without giving effect to any choice of law or conflict of law provision or rule (whether of the State of New York or any other jurisdictions)
that would cause the application of the laws of any jurisdictions other than the State of New York. Each party hereby irrevocably submits
to the exclusive jurisdiction of the state and federal courts sitting in The City of New York, Borough of Manhattan, for the adjudication
of any dispute hereunder or in connection herewith or with any transaction contemplated hereby or discussed herein, and hereby irrevocably
waives, and agrees not to assert in any suit, action or proceeding, any claim that it is not personally subject to the jurisdiction of
any such court, that such suit, action or proceeding is brought in an inconvenient forum or that the venue of such suit, action or proceeding
is improper. Each party hereby irrevocably waives personal service of process and consents to process being served in any such suit, action
or proceeding by mailing a copy thereof to such party at the address for such notices to it under this Agreement and agrees that such
service shall constitute good and sufficient service of process and notice thereof. Nothing contained herein shall be deemed to limit
in any way any right to serve process in any manner permitted by law. EACH PARTY HEREBY IRREVOCABLY WAIVES ANY RIGHT IT MAY HAVE, AND
AGREES NOT TO REQUEST, A JURY TRIAL FOR THE ADJUDICATION OF ANY DISPUTE HEREUNDER OR IN CONNECTION HEREWITH OR ARISING OUT OF THIS AGREEMENT
OR ANY TRANSACTION CONTEMPLATED HEREBY.
(e) If any provision of this
Agreement is prohibited by law or otherwise determined to be invalid or unenforceable by a court of competent jurisdiction, the provision
that would otherwise be prohibited, invalid or unenforceable shall be deemed amended to apply to the broadest extent that it would be
valid and enforceable, and the invalidity or unenforceability of such provision shall not affect the validity of the remaining provisions
of this Agreement so long as this Agreement as so modified continues to express, without material change, the original intentions of the
parties as to the subject matter hereof and the prohibited nature, invalidity or unenforceability of the provision(s) in question does
not substantially impair the respective expectations or reciprocal obligations of the parties or the practical realization of the benefits
that would otherwise be conferred upon the parties. The parties will endeavor in good faith negotiations to replace the prohibited, invalid
or unenforceable provision(s) with a valid provision(s), the effect of which comes as close as possible to that of the prohibited, invalid
or unenforceable provision(s).
(f) This Agreement, the other
Transaction Documents (as defined in the Securities Purchase Agreement) and the instruments referenced herein and therein constitute the
entire agreement among the parties hereto with respect to the subject matter hereof and thereof. There are no restrictions, promises,
warranties or undertakings, other than those set forth or referred to herein and therein. This Agreement, the other Transaction Documents
and the instruments referenced herein and therein supersede all prior agreements and understandings among the parties hereto with respect
to the subject matter hereof and thereof.
(g) Subject to the requirements
of Section 9, this Agreement shall inure to the benefit of and be binding upon the permitted successors and assigns of each of the parties
hereto.
(h) The headings in this Agreement
are for convenience of reference only and shall not limit or otherwise affect the meaning hereof.
(i) This Agreement may be
executed in identical counterparts, each of which shall be deemed an original but all of which shall constitute one and the same agreement.
This Agreement, once executed by a party, may be delivered to the other party hereto by facsimile transmission of a copy of this Agreement
bearing the signature of the party so delivering this Agreement.
(j) Each party shall do and
perform, or cause to be done and performed, all such further acts and things, and shall execute and deliver all such other agreements,
certificates, instruments and documents, as any other party may reasonably request in order to carry out the intent and accomplish the
purposes of this Agreement and the consummation of the transactions contemplated hereby.
(k) All consents and other
determinations required to be made by the Investors pursuant to this Agreement shall be made, unless otherwise specified in this Agreement,
by the Required Holders, determined as if all of the Warrants held by Investors then outstanding have been exercised for Registrable Securities
without regard to any limitations on exercise of the Warrants.
(l) The language used in this
Agreement will be deemed to be the language chosen by the parties to express their mutual intent and no rules of strict construction will
be applied against any party.
(m) This Agreement is intended
for the benefit of the parties hereto and their respective permitted successors and assigns, and is not for the benefit of, nor may any
provision hereof be enforced by, any other Person.
(n) The obligations of each
Investor hereunder are several and not joint with the obligations of any other Investor, and no provision of this Agreement is intended
to confer any obligations on any Investor vis-à-vis any other Investor. Nothing contained herein, and no action taken by any Investor
pursuant hereto, shall be deemed to constitute the Investors as a partnership, an association, a joint venture or any other kind of entity,
or create a presumption that the Investors are in any way acting in concert or as a group with respect to such obligations or the transactions
contemplated herein.
* * * * * *
[Signature Page Follows]
IN WITNESS WHEREOF, each
Buyer and the Company have caused their respective signature page to this Registration Rights Agreement to be duly executed as of the
date first written above.
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COMPANY: |
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NXU, INC. |
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By: |
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Name: |
Mark Hanchett |
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Title: |
Chief Executive Officer |
IN WITNESS WHEREOF, each
Buyer and the Company have caused their respective signature page to this Registration Rights Agreement to be duly executed as of the
date first written above.
SCHEDULE OF BUYERS
Buyer | |
Buyer Address, Facsimile
Number and E-mail | | |
Buyer’s Representative’s Address, Facsimile Number and E-Mail | |
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Exhibit 10.3
LOCK-UP AGREEMENT
December 26, 2024
| Re: | Securities Purchase Agreement, dated as of December 26, 2024 (the “Purchase Agreement”),
between Nxu, Inc. (the “Company”) and the purchasers signatory thereto (each, a “Purchaser” and,
collectively, the “Purchasers”) |
Ladies and Gentlemen:
Defined terms not
otherwise defined in this letter agreement (the “Letter Agreement”) shall have the meanings set forth in the Purchase
Agreement. Pursuant to Section 7(x) of the Purchase Agreement and in satisfaction of a condition to the Purchasers’ obligation to
purchase the Purchased Shares and the related Warrants thereunder, the undersigned irrevocably agrees with the Company that, from the
date hereof until 30 days after the earlier of (x) such time as one or more Registration Statement(s) covering the resale of all Registrable
Securities has been effective and available for the re-sale of all such Registrable Securities, and (y) such time as all of the Registrable
Securities may be sold without restriction or limitation pursuant to Rule 144 (such period, the “Restriction Period”)
the undersigned will not offer, sell, contract to sell, hypothecate, pledge or otherwise dispose of (or enter into any transaction which
is designed to, or might reasonably be expected to, result in the disposition (whether by actual disposition or effective economic disposition
due to cash settlement or otherwise) by the undersigned or any Affiliate of the undersigned or any person in privity with the undersigned
or any Affiliate of the undersigned), directly or indirectly, or establish or increase a put equivalent position or liquidate or decrease
a call equivalent position within the meaning of Section 16 of the Securities Exchange Act of 1934, as amended (the “Exchange
Act”), with respect to, any shares of Common Stock of the Company or securities convertible, exchangeable or exercisable into,
shares of Common Stock of the Company beneficially owned, held or hereafter acquired by the undersigned (the “Securities”).
Beneficial ownership shall be calculated in accordance with Section 13(d) of the Exchange Act.
Notwithstanding
the foregoing, and subject to the conditions below, the undersigned may transfer the Securities, provided that (1) the Company receives
a signed lock-up letter agreement (in the form of this Letter Agreement) for the balance of the Restriction Period from each donee, trustee,
distributee, or transferee, as the case may be, prior to such transfer, (2) any such transfer shall not involve a disposition for
value, (3) such transfer is not required to be reported with the Securities and Exchange Commission in accordance with the Exchange
Act and no report of such transfer shall be made voluntarily, and (4) neither the undersigned nor any donee, trustee, distributee
or transferee, as the case may be, otherwise voluntarily effects any public filing or report regarding such transfers, with respect to
transfer:
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i) |
as a bona fide gift or gifts; |
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ii) |
to any immediate family member or to any trust for the direct or indirect benefit of the undersigned or the immediate family of the undersigned (for purposes of this Letter Agreement, “immediate family” shall mean any relationship by blood, marriage or adoption, not more remote than first cousin); |
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iii) |
to any corporation, partnership, limited liability company, or other business entity all of the equity holders of which consist of the undersigned and/or the immediate family of the undersigned; |
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iv) |
if the undersigned is a corporation, partnership, limited liability company, trust or other business entity (a) to another corporation, partnership, limited liability company, trust or other business entity that is an Affiliate of the undersigned or (b) in the form of a distribution to limited partners, limited liability company members or stockholders of the undersigned; |
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v) |
if the undersigned is a trust, to the beneficiary of such trust; |
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vi) |
by will, other testamentary document or intestate succession to the legal representative, heir, beneficiary or a member of the immediate family of the undersigned; |
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vii) |
by operation of law, such as pursuant to a qualified domestic order or in connection with a divorce decree; or |
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viii) |
to cover the payment of the exercise prices or the payment of taxes associated with the exercise or vesting of equity awards that were issued under any equity compensation plan of the Company. |
In addition, notwithstanding
the foregoing, this Letter Agreement shall not restrict the delivery of shares of Common Stock to the undersigned upon (i) exercise any
options granted under any employee benefit plan of the Company; provided that any shares of Common Stock or Securities acquired in connection
with any such exercise will be subject to the restrictions set forth in this Letter Agreement, or (ii) the exercise of warrants; provided
that such shares of Common Stock delivered to the undersigned in connection with such exercise are subject to the restrictions set forth
in this Letter Agreement.
Furthermore, the
undersigned may enter into any new plan established in compliance with Rule 10b5-1 of the Exchange Act; provided that (i) such plan may
only be established if no public announcement or filing with the Securities and Exchange Commission, or other applicable regulatory authority,
is made in connection with the establishment of such plan during the Restriction Period and (ii) no sale of shares of Common Stock are
made pursuant to such plan during the Restriction Period.
The undersigned
acknowledges that the execution, delivery and performance of this Letter Agreement is a material inducement to the Company to complete
the transactions contemplated by the Purchase Agreement and the Company shall be entitled to specific performance of the undersigned’s
obligations hereunder. The undersigned hereby represents that the undersigned has the power and authority to execute, deliver and perform
this Letter Agreement, that the undersigned has received adequate consideration therefor and that the undersigned will indirectly benefit
from the closing of the transactions contemplated by the Purchase Agreement.
This Letter Agreement may
not be amended or otherwise modified in any respect without the written consent of each of the Company and the undersigned. This Letter
Agreement shall be construed and enforced in accordance with the laws of the State of New York without regard to the principles of conflict
of laws. The undersigned hereby irrevocably submits to the exclusive jurisdiction of the United States District Court sitting in the Southern
District of New York and the courts of the State of New York located in Manhattan, for the purposes of any suit, action or proceeding
arising out of or relating to this Letter Agreement, and hereby waives, and agrees not to assert in any such suit, action or proceeding,
any claim that (i) it is not personally subject to the jurisdiction of such court, (ii) the suit, action or proceeding is brought in an
inconvenient forum, or (iii) the venue of the suit, action or proceeding is improper. The undersigned hereby irrevocably waives personal
service of process and consents to process being served in any such suit, action or proceeding by receiving a copy thereof sent to the
Company at the address in effect for notices to it under the Purchase Agreement and agrees that such service shall constitute good and
sufficient service of process and notice thereof. The undersigned hereby waives any right to a trial by jury. Nothing contained herein
shall be deemed to limit in any way any right to serve process in any manner permitted by law. The undersigned agrees and understands
that this Letter Agreement does not intend to create any relationship between the undersigned and any Purchaser, and that no Purchaser
is entitled to cast any votes on the matters herein contemplated and that no issuance or sale of the Securities is created or intended
by virtue of this Letter Agreement.
This Letter Agreement shall
be binding on successors and assigns of the undersigned with respect to the Securities and any such successor or assign shall enter into
a similar agreement for the benefit of the Company. This Letter Agreement is intended for the benefit of the parties hereto and their
respective successors and permitted assigns and is not for the benefit of, nor may any provision hereof be enforced by, any other Person.
*** SIGNATURE PAGE FOLLOWS***
This Letter Agreement may
be executed in two or more counterparts, all of which when taken together may be considered one and the same agreement.
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| Signature |
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| Print Name |
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| Position in Company, if any |
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By signing below, the Company
agrees to enforce the restrictions on transfer set forth in this Letter Agreement.
| NXU, INC. |
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| By: |
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| Name: |
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| Title: |
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Exhibit 10.4
| TO: | Maxim Group LLC, as Placement Agent |
To Whom It May Concern:
This letter will
confirm my agreement to vote all shares of NXU, Inc. (the “Company”) voting stock over which I have voting control
in favor of any resolution presented to the shareholders of the Company to approve the terms and exercise of the Series A Warrant to Purchase
Common Stock and Series B Warrant to Purchase Common Stock issued pursuant to that certain Securities Purchase Agreement, dated December
26, 2024, among Company and the purchasers signatory thereto (the “Purchase Agreement”) and the other agreements entered
into in connection therewith or as otherwise may be required by the applicable rules and regulations of the Nasdaq Stock Market (or any
successor entity). The undersigned acknowledges that the execution, delivery and performance of this letter is a material inducement to
the Company to complete the transactions contemplated by the Purchase Agreement and the Company shall be entitled to specific performance
of the undersigned’s obligations hereunder. The undersigned hereby represents that the undersigned has the power and authority to
execute, deliver and perform the obligations contained in this letter, that the undersigned has received adequate consideration therefor
and that the undersigned will indirectly benefit from the closing of the transactions contemplated by the Purchase Agreement and that
this agreement is not revocable by me.
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By: |
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Name of Shareholder: |
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Number of voting shares over which I have voting control: _________________ |
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