Exhibit 10.2

COMMON STOCK PURCHASE WARRANT

NEITHER THIS SECURITY NOR THE SECURITIES FOR WHICH THIS SECURITY ARE EXERCISABLE
HAVE BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION OR THE
SECURITIES COMMISSION OF ANY STATE IN RELIANCE UPON AN EXEMPTION FROM
REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES
ACT”), AND APPLICABLE STATE SECURITIES LAWS, AND, ACCORDINGLY, MAY NOT BE
OFFERED OR SOLD EXCEPT PURSUANT TO (I) AN EFFECTIVE REGISTRATION STATEMENT UNDER
THE SECURITIES ACT OR AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT
SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND IN
ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS AS EVIDENCED BY A LEGAL OPINION
OF COUNSEL TO THE TRANSFEROR (IF REQUESTED BY THE COMPANY) TO SUCH EFFECT, THE
SUBSTANCE OF WHICH SHALL BE REASONABLY ACCEPTABLE TO THE COMPANY OR (II) RULE
144 PROMULGATED UNDER THE SECURITIES ACT.  NOTWITHSTANDING THE FOREGOING, THIS
SECURITY AND THE SECURITIES ISSUABLE UPON EXERCISE OF THIS SECURITY MAY BE
PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT OR OTHER LOAN SECURED BY
SUCH SECURITIES.

PRECIPIO, INC.

Warrant To Purchase Common Stock

Warrant No.: 1-5/[    ]/2019

Date of Issuance: May [   ] 2019 (“Issuance Date”)

Precipio, Inc., a Delaware corporation (the “Company”), hereby certifies that,
for good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, [NAME OF INVESTOR]., the registered holder hereof or its
permitted assigns (the “Holder”), is entitled, subject to the terms set forth
below, to purchase from the Company, at the Exercise Price (as defined below)
then in effect, upon exercise of this Warrant to Purchase Common Stock
(including any Warrants to Purchase Common Stock issued in exchange, transfer or
replacement hereof, the “Warrant”), at any time or times on or after the date
which is six months after the Issuance Date, but not after 11:59 p.m., New York
time, on the Expiration Date (as defined below), [INSERT–.] (subject to
adjustment as provided herein) fully paid and non-assessable shares of Common
Stock (as defined below) (the “Warrant Shares”). Except as otherwise defined
herein, capitalized terms in this Warrant shall have the meanings set forth in
Section ‎17. This Warrant is one of the Warrants to Purchase Common Stock (the
“SPA Warrants”) issued pursuant to that certain Securities Purchase Agreement,
dated as of the date hereof, by and among the Company and the investor(s)
thereunder (the “Purchaser” or “Purchasers” as applicable) referred to therein
(the “Securities Purchase Agreement”).

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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
date which is six months after the Issuance Date, but not after 11:59 p.m., New
York time, on the Expiration Date (as defined below) in whole or in part, by
delivery (whether via facsimile or otherwise) of a written notice, in the form
attached hereto as Exhibit A (the “Exercise Notice”), of the Holder’s election
to exercise this Warrant. Within one (1) Trading Day following an exercise of
this Warrant as aforesaid, the Holder shall deliver payment to the Company of an
amount equal to the Exercise Price in effect on the date of such exercise
multiplied by the number of Warrant Shares as to which this Warrant was so
exercised (in respect of such specific exercise, the “Aggregate Exercise Price”)
in cash or via wire transfer of immediately available funds if the Holder did
not notify the Company in such Exercise Notice that such exercise was made
pursuant to a Cashless Exercise (as defined in Section ‎1‎1(d)). The Holder
shall not be required to deliver the original of this Warrant in order to effect
an exercise hereunder. Execution and delivery of an Exercise Notice with respect
to less than all of the Warrant Shares shall have the same effect as
cancellation of the original of this Warrant certificate and issuance of a new
Warrant certificate evidencing the right to purchase the remaining number of
Warrant Shares. Execution and delivery of an Exercise Notice for all of the
then-remaining Warrant Shares shall have the same effect as cancellation of the
original of this Warrant certificate after delivery of the Warrant Shares in
accordance with the terms hereof. On or before the first (1st) Trading Day
following the later of (i) the date on which the Company has received an
Exercise Notice or (ii) the date on which the Company receives the Aggregate
Exercise Price, the Company shall transmit by facsimile an acknowledgment of
confirmation of receipt of such Exercise Notice, in the form attached hereto as
Exhibit B, to the Holder and the Company’s transfer agent (the “Transfer
Agent”). On or before the second  (2nd) Trading Day following the later of (i)
the date on which the Company has received such Exercise Notice or (ii) if the
Aggregate Exercise Price is not paid by the Holder within one (1) Trading Day
following such exercise as contemplated above in this Section ‎1‎(a), the date
on which the Company receives the Aggregate Exercise Price (such later date is
referred to herein as the “Delivery Date”), the Company shall (X) provided that
(I) the Transfer Agent is participating in The Depository Trust Company (“DTC”)
Fast Automated Securities Transfer Program and (II) either a Registration
Statement (as defined in the Securities Purchase Agreement)) for the resale by
the Holder of the applicable Warrant Shares to be issued pursuant to such
Exercise Notice is effective or such Warrant Shares are otherwise eligible for
resale pursuant to Rule 144 (as defined in the Securities Purchase Agreement),
credit such aggregate number of shares of Common Stock to which the Holder is
entitled pursuant to such exercise to the Holder’s or its designee’s balance
account with DTC through its Deposit/ Withdrawal at Custodian system, or (Y) if
either of the immediately preceding clauses (I) or (II) are not satisfied, issue
and deliver to the Holder or, at the Holder’s instruction pursuant to the
Exercise Notice, the Holder’s agent or designee, in each case, sent by reputable
overnight courier to the address as specified in the applicable Exercise Notice,
a certificate, registered in the Company’s share register in the name of the
Holder or its designee (as indicated in the applicable Exercise Notice), for the
number of shares of Common Stock to which the Holder is entitled pursuant to
such exercise. Upon delivery of an Exercise Notice, the Holder shall be deemed
for all corporate purposes to have become the holder of record of the Warrant
Shares with respect to which this Warrant has been exercised, irrespective of
the date such Warrant Shares are credited to the Holder’s DTC account

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or the date of delivery of the certificates evidencing such Warrant Shares (as
the case may be). If this Warrant is submitted in connection with any exercise
pursuant to this Section ‎1‎(a) and the number of Warrant Shares represented by
this Warrant submitted for exercise is greater than the number of Warrant Shares
being acquired upon an exercise, then, at the request of the Holder and upon
surrender hereof by the Holder at the principal office of the Company, the
Company shall as soon as practicable and in no event later than three (3)
Business Days after any exercise and at its own expense, issue and deliver to
the Holder (or its designee) a new Warrant (in accordance with Section ‎7(g))
representing the right to purchase the number of Warrant Shares purchasable
immediately prior to such exercise under this Warrant, less the number of
Warrant Shares with respect to which this Warrant is exercised. No fractional
shares of Common Stock are to be issued upon the exercise of this Warrant, but
rather the number of shares of Common Stock to be issued shall be rounded up to
the nearest whole number. The Company shall pay any and all taxes and fees which
may be payable with respect to the issuance and delivery of Warrant Shares upon
exercise of this Warrant. 

 

(b) Exercise Price. For purposes of this Warrant, “Exercise Price” means [INSERT
$9.56 subject to adjustment as provided herein.

 

(c) Company’s Failure to Timely Deliver Securities

. If the Company shall fail, for any reason or for no reason, to issue to the
Holder on or before the applicable Delivery Date, a certificate for the number
of shares of Common Stock to which the Holder is entitled and register such
shares of Common Stock on the Company’s share register or to credit the Holder’s
balance account with DTC for such number of shares of Common Stock to which the
Holder is entitled upon the Holder’s exercise of this Warrant (as the case may
be), then, in addition to all other remedies available to the Holder, the
Company shall pay in cash to the Holder on each day after such second  (2nd)
Trading Day that the issuance of such shares of Common Stock is not timely
effected an amount equal to 2% of the product of (A) the aggregate number of
shares of Common Stock not issued to the Holder on a timely basis and to which
the Holder is entitled and (B) the Closing Sale Price of the Common Stock on the
Trading Day immediately preceding the last possible date on which the Company
could have issued such shares of Common Stock to the Holder without violating
Section ‎1‎(a).  In addition to the foregoing, if the Company shall fail to
issue and deliver a certificate to the Holder and register such shares of Common
Stock on the Company’s share register or credit the Holder’s balance account
with DTC for the number of shares of Common Stock to which the Holder is
entitled upon the Holder’s exercise or exchange hereunder (as the case may be)
on or prior to the applicable Delivery Date, and if on or after such Delivery
Date the Holder (or any other Person in respect, or on behalf, of 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 all or any portion of the
number of shares of Common Stock, or a sale of a number of shares of Common
Stock equal to all or any portion of the number of shares of Common Stock,
issuable upon such exercise or exchange that the Holder so anticipated receiving
from the Company, then, in addition to all other remedies available to the
Holder, the Company shall, within three (3) Business Days after the Holder’s
request and in the Holder’s discretion, either (i) pay cash to the Holder in an
amount equal to the Holder’s total purchase price (including brokerage
commissions and other out-of-pocket expenses, if any) for the shares of Common
Stock so purchased (including, without limitation, by any other Person in
respect, or on behalf, of the Holder) (the “Buy-In Price”), at which point the
Company’s obligation to so issue and deliver such certificate or credit the
Holder’s balance account with DTC for the number of shares of

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Common Stock to which the Holder is entitled upon the Holder’s exercise or
exchange hereunder (as the case may be) (and to issue such shares of Common
Stock) shall terminate, or (ii) promptly honor its obligation to so issue and
deliver to the Holder a certificate or certificates representing such shares of
Common Stock or credit the Holder’s balance account with DTC for the number of
shares of Common Stock to which the Holder is entitled upon the Holder’s
exercise or exchange hereunder (as the case may be) and pay cash to the Holder
in an amount equal to the excess (if any) of the Buy-In Price over the product
of (A) such number of shares of Common Stock multiplied by (B) the lowest
Closing Sale Price of the Common Stock on any Trading Day during the period
commencing on the date of the applicable Exercise Notice or Exchange Notice, as
the case may be, and ending on the date of such issuance and payment under this
clause (ii).

(d) Cashless Exercise. Notwithstanding anything contained herein to the contrary
(other than Section ‎1‎(f) below), at any time when the Warrant Shares are not
subject to an effective Registration Statement the Holder may, in its sole
discretion (and without limiting the Holder’s rights and remedies contained
herein or in any of the other Transaction Documents (as defined in the
Securities Purchase Agreement)), exercise this Warrant in whole or in part and,
as a cashless exercise of the Warrant with respect to the number of shares
specified in “A” below and issue the “Net Number” of shares of Common Stock
determined according to the following formula with respect thereto (a “Cashless
Exercise”), as follows:

 

Net Number = (A x B) - (A x C)

B

For purposes of the foregoing formula:

A= the total number of shares with respect to which this Warrant is then being
exercised.

B= the arithmetic average of the Closing Sale Prices for the five (5)
consecutive Trading Days ending on the date immediately preceding the date of
the Exercise Notice.

C= the Exercise Price then in effect for the applicable Warrant Shares at the
time of such exercise.

(e) Disputes.  In the case of a dispute as to the determination of the Exercise
Price or the arithmetic calculation of the number of Warrant Shares to be issued
pursuant to the terms hereof (including, without limitation, the Net Number),
the Company shall promptly issue to the Holder the number of Warrant Shares that
are not disputed, provided that following such issuance to Holder such dispute
shall be resolved in accordance with Section ‎14.

 

(f) Limitations on Exercises. 

(i) Notwithstanding anything to the contrary contained in this Warrant, this
Warrant shall not be exercisable by the Holder hereof to the extent (but only to
the extent) that the Holder or any of its Affiliates would beneficially own in
excess of 4.99%

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(the “Maximum Percentage”) of the Common Stock. To the extent the above
limitation applies, the determination of whether this Warrant shall be
exercisable (vis-à-vis other convertible, exercisable securities owned by the
Holder or any of its Affiliates) and of which such securities shall be
exercisable (as among all such securities owned by the Holder) shall, subject to
such Maximum Percentage limitation, be determined on the basis of the first
submission to the Company for conversion, exercise (as the case may be). 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. For the purposes of this
paragraph, beneficial ownership and all determinations and calculations
(including, without limitation, with respect to calculations of percentage
ownership) shall be determined in accordance with Section 13(d) of the Exchange
Act (as defined in the Securities Purchase Agreement) and the rules and
regulations promulgated thereunder. The provisions of this paragraph shall not
be implemented in a manner otherwise than in strict conformity with the terms of
this paragraph to correct this paragraph (or any portion hereof) which may be
defective or inconsistent with the intended Maximum Percentage beneficial
ownership limitation herein contained or to make changes or supplements
necessary or desirable to properly give effect to such Maximum Percentage
limitation. The limitations contained in this paragraph shall apply to a
successor Holder of this Warrant. The holders of Common Stock shall be third
party beneficiaries of this paragraph and the Company may not amend or waive
this paragraph without the consent of holders of a majority of its Common Stock.
For any reason at any time, upon the written or oral request of the Holder, the
Company shall within one (1) Business Day confirm orally and in writing to the
Holder the number of shares of Common Stock then outstanding, including by
virtue of any prior conversion or exercise or exchange of convertible or
exercisable or exchangeable securities into Common Stock, including, without
limitation, pursuant to this Warrant or securities issued pursuant to the
Securities Purchase Agreement.

(g) Insufficient Authorized Shares. The Company shall at all times keep reserved
for issuance under this Warrant a number of shares of Common Stock as shall be
necessary to satisfy the Company’s obligation to issue shares of Common Stock
hereunder (without regard to any limitation otherwise contained herein with
respect to the number of shares of Common Stock that may be acquirable upon
exercise or exchange of this Warrant). If, notwithstanding the foregoing, and
not in limitation thereof, at any time while any of the SPA Warrants remain
outstanding the Company does not have a sufficient number of authorized and
unreserved shares of Common Stock to satisfy its obligation to reserve for
issuance upon exercise of the SPA Warrants at least a number of shares of Common
Stock equal to the number of shares of Common Stock as shall from time to time
be necessary to effect the exercise or exchange of all of the SPA Warrants then
outstanding (the “Required Reserve Amount”) (an “Authorized Share Failure”),
then the Company shall immediately take all action necessary to increase the
Company’s authorized shares of Common Stock to an amount sufficient to allow the
Company to reserve the Required Reserve Amount for all the SPA Warrants then
outstanding. Without limiting the generality of the foregoing sentence, as soon
as practicable after the date of the occurrence of an Authorized Share Failure,
but in no event later than ninety  (90) 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

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commercially reasonable 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.

 

2. ADJUSTMENT OF EXERCISE PRICE AND NUMBER OF WARRANT SHARES.    The Exercise
Price and number of Warrant Shares issuable upon exercise of this Warrant are
subject to adjustment from time to time as set forth in this Section ‎2.

 

(a) Stock Dividends and Splits.  Without limiting any provision of Section ‎4,
if the Company, at any time on or after the date of the Securities Purchase
Agreement, (i) pays a stock dividend on one or more classes of its then
outstanding shares of Common Stock or otherwise makes a distribution on any
class of capital stock that is payable in shares of Common Stock, (ii)
subdivides (by any stock split, stock dividend, recapitalization or otherwise)
one or more classes of its then outstanding shares of Common Stock into a larger
number of shares or (iii) combines (by combination, reverse stock split or
otherwise) one or more classes of its then outstanding shares of Common Stock
into a smaller number of shares, then in each such case the Exercise Price shall
be multiplied by a fraction of which the numerator shall be the number of shares
of Common Stock outstanding immediately before such event and of which the
denominator shall be the number of shares of Common Stock outstanding
immediately after such event.  Any adjustment made pursuant to clause (i) of
this paragraph shall become effective immediately after the record date for the
determination of shareholders entitled to receive such dividend or distribution,
and any adjustment pursuant to clause (ii) or (iii) of this paragraph shall
become effective immediately after the effective date of such subdivision or
combination. If any event requiring an adjustment under this paragraph occurs
during the period that an Exercise Price is calculated hereunder, then the
calculation of such Exercise Price shall be adjusted appropriately to reflect
such event.

 

 

(b) Calculations.    All calculations under this Section ‎2 shall be made by
rounding to the nearest 1/1000th of cent and the nearest 1/100th of a share, as
applicable. The number of shares of Common Stock outstanding at any given time
shall not include shares owned or held by or for the account of the Company, and
the disposition of any such shares shall be considered an issue or sale of
Common Stock.

 

(c) Other Events.  In the event that the Company shall take any action to which
the provisions hereof are not strictly applicable, or, if applicable, would not
operate to protect the Holder from dilution or if any event occurs of the type
contemplated by the provisions of this Section ‎2 but not expressly provided for
by such provisions (including, without limitation, the granting of stock
appreciation rights, phantom stock rights or other rights with equity features),
then the Company’s board of directors shall in good faith determine and
implement an appropriate adjustment in the Exercise Price and the number of
Warrant Shares (if applicable) so as to protect the rights of the Holder,
provided that no such adjustment pursuant to this Section  will increase the
Exercise Price or decrease the number of Warrant Shares as otherwise determined
pursuant to this Section ‎2(b), provided further that if the Holder does not
accept such adjustments as appropriately protecting its interests hereunder
against such dilution, then the Company’s board of directors and the Holder
shall agree, in good faith, upon an independent investment bank of nationally
recognized standing to make such appropriate adjustments, whose

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determination shall be final and binding and whose fees and expenses shall be
borne by the Company.

 

3. RIGHTS UPON DISTRIBUTION OF ASSETS. In addition to any adjustments pursuant
to Section ‎2 above, if the Company, at any time prior to the Expiration Date,
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, indebtedness, property or options by way of
a dividend, spin off, reclassification, corporate rearrangement, scheme of
arrangement or other similar transaction) (a “Distribution”), at any time after
the issuance of this Warrant, then, in each such case, the Holder shall be
entitled to participate in such Distribution to the same extent that the Holder
would have participated therein if the Holder had held the number of shares of
Common Stock acquirable upon complete exercise of this Warrant (without regard
to any limitations on exercise hereof, including without limitation, the Maximum
Percentage) immediately before the date on which a record is taken for such
Distribution, or, if no such record is taken, the date as of which the record
holders of shares of Common Stock are to be determined for the participation in
such Distribution (provided, however, to the extent that the Holder’s right to
participate in any such Distributions would result in the Holder exceeding the
Maximum Percentage, then the Holder shall not be entitled to participate in such
Distribution to such extent (or the beneficial ownership of any such shares of
Common Stock as a result of such Distribution to such extent) and such
Distribution to such extent shall be held in abeyance for the benefit of the
Holder until such time, if ever, as its right thereto would not result in the
Holder exceeding the Maximum Percentage), provided further, such Distribution
shall be held in abeyance for the benefit of the Holder until such time as the
Holder exercises this Warrant (whether in whole or in part), and subject to the
foregoing proviso, upon each exercise of this Warrant the Company shall make
such Distribution to the Holder with respect to each Warrant Share for which
this Warrant is so exercised until such time as this Warrant has been exercised
in full).

 

4. PURCHASE RIGHTS; FUNDAMENTAL TRANSACTIONS.

(a) Purchase Rights.  In addition to any adjustments pursuant to Section ‎2
above, if the Company, at any time prior to the Expiration Date, 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 shares of Common Stock (the “Purchase Rights”), then the Holder will be
entitled to acquire, upon the terms applicable to such Purchase Rights, the
aggregate Purchase Rights which the Holder could have acquired if the Holder had
held the number of shares of Common Stock acquirable upon complete exercise of
this Warrant (without regard to any limitations on exercise hereof, 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, to the extent that the Holder’s right to participate
in any such Purchase Right would result in the Holder exceeding the Maximum
Percentage, then the Holder shall not be entitled to participate in such
Purchase Right to such extent (or beneficial ownership of such shares of Common
Stock as a result of such Purchase Right to such extent) and such Purchase Right
to such extent shall be held in abeyance for the Holder until such time, if
ever, as its right

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thereto would not result in the Holder exceeding the Maximum Percentage),
provided further, such Purchase Rights shall be held in abeyance for the benefit
of the Holder until such time as the Holder exercises this Warrant (whether in
whole or in part), and subject to the foregoing proviso, upon each exercise of
this Warrant the Company shall deliver such Purchase Rights to the Holder with
respect to each Warrant Share for which this Warrant is so exercised until such
time as this Warrant has been exercised in full).

 

(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 related to this Warrant in accordance with the provisions of this
Section ‎4‎(b) pursuant to written agreements in form and substance reasonably
satisfactory to the Holder and approved by the Holder prior to such Fundamental
Transaction, including agreements confirming the obligations of the Successor
Entity as set forth in this paragraph ‎(b) and ‎(c) and elsewhere in this
Warrant and an obligation to deliver to the Holder in exchange for this Warrant
a security of the Successor Entity evidenced by a written instrument
substantially similar in form and substance to this Warrant, including, without
limitation, which is exercisable for a corresponding number of shares of capital
stock equivalent to the shares of Common Stock acquirable and receivable upon
exercise of this Warrant (without regard to any limitations on the exercise of
this Warrant) prior to such Fundamental Transaction, and with an exercise price
which applies the exercise price hereunder to such shares of capital stock (but
taking into account the relative value of the shares of Common Stock pursuant to
such Fundamental Transaction and the value of such shares of capital stock, such
adjustments to the number of shares of capital stock and such exercise price
being for the purpose of protecting the economic value of this Warrant
immediately prior to the consummation of such Fundamental
Transaction).  Notwithstanding the foregoing, at the election of the Holder upon
exercise of this Warrant following a Fundamental Transaction, the Successor
Entity shall deliver to the Holder, in lieu of the shares of Common Stock (or
other securities, cash, assets or other property (except such items still
issuable under Sections ‎3 and ‎4‎(a) above, which shall continue to be
receivable thereafter)) issuable upon the exercise of this Warrant prior to the
applicable Fundamental Transaction,  such shares of common stock (or its
equivalent) of the Successor Entity (including its Parent Entity), or other
securities, cash, assets or other property, which the Holder would have been
entitled to receive upon the happening of the applicable Fundamental Transaction
had this Warrant been exercised immediately prior to the applicable Fundamental
Transaction (without regard to any limitations on the exercise of this Warrant).

 

(c) Black Scholes Value -- FT. Notwithstanding the foregoing and the provisions
of Section ‎4‎(b) above, at the request of the Holder delivered at any time
commencing on the earliest to occur of (x) the consummation of any Fundamental
Transaction and (y) the Holder first becoming aware of any Fundamental
Transaction through the date that is ninety (90) days after the public
disclosure of the consummation of such Fundamental Transaction by the Company
pursuant to a current Report on Form 8-K filed with the SEC, the Company or the
Successor Entity, at the election of the Holder, shall purchase this Warrant
from the Holder on the date of such request by paying to the Holder cash in an
amount equal to the Black Scholes Value -- FT.

 

(d) Application. The provisions of this Section ‎4 shall apply similarly and
equally to successive Fundamental Transactions and shall be applied as if this
Warrant (and any such

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subsequent warrants issued hereunder) were fully exercisable and without regard
to any limitations on the exercise of this Warrant (provided that the Holder
shall continue to be entitled to the benefit of the Maximum Percentage, applied
however with respect to shares of capital stock registered under the Exchange
Act and thereafter receivable upon exercise of this Warrant (or any such other
warrant)).

 

5. NONCIRCUMVENTION. The Company hereby covenants and agrees that the Company
will not, by amendment of its Certificate of Incorporation, as amended,,
 bylaws, as amended, 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 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 shares of 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 non-assessable 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, the maximum 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 STOCKHOLDER. Except as otherwise specifically
provided herein, the Holder, solely in its capacity as a holder of this Warrant,
shall not be entitled to vote or receive dividends or be deemed the holder of
share capital of the Company for any purpose, nor shall anything contained in
this Warrant be construed to confer upon the Holder, solely in its capacity as
the Holder of this Warrant, any of the rights of a stockholder of the Company or
any right to vote, give or withhold consent to any corporate action (whether any
reorganization, issue of stock, reclassification of stock, consolidation,
merger, conveyance or otherwise), receive notice of meetings, receive dividends
or subscription rights, or otherwise, prior to the issuance to the Holder of the
Warrant Shares which it is then entitled to receive upon the due exercise of
this Warrant.  In addition, nothing contained in this Warrant shall be construed
as imposing any liabilities on the Holder to purchase any securities (upon
exercise of this Warrant or otherwise) or as a stockholder of the Company,
whether such liabilities are asserted by the Company or by creditors of the
Company. Notwithstanding this Section ‎6, the Company shall provide the Holder
with copies of the same notices and other information given to the stockholders
of the Company generally, contemporaneously with the giving thereof to the
stockholders.

 

7. REISSUANCE OF WARRANTS.

(a) Transfer of Warrant. If this Warrant is to be transferred, the Holder shall
surrender this Warrant to the Company, whereupon the Company will forthwith
issue and deliver upon the order of the Holder a new Warrant (in accordance with
Section ‎7‎(g)), 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

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this Warrant is being transferred, a new Warrant (in accordance with Section
‎7‎(g)) to the Holder representing the right to purchase the number of Warrant
Shares not being transferred.

 

(b) Lost, Stolen or Mutilated Warrant.  Upon receipt by the Company of evidence
reasonably satisfactory to the Company of the loss, theft, destruction or
mutilation of this Warrant (as to which a written certification and the
indemnification contemplated below shall suffice as such evidence), and, in the
case of loss, theft or destruction, of any indemnification undertaking by the
Holder to the Company in customary and reasonable form and, in the case of
mutilation, upon surrender and cancellation of this Warrant, the Company shall
execute and deliver to the Holder a new Warrant (in accordance with Section
‎7‎(g)) 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(g)) representing in the
aggregate the right to purchase the number of Warrant Shares then underlying
this Warrant, and each such new Warrant will represent the right to purchase
such portion of such Warrant Shares as is designated by the Holder at the time
of such surrender; provided, however, no warrants for fractional shares of
Common Stock shall be given.

 

(d) Issuance of New Warrants.  Whenever the Company is required to issue a new
Warrant pursuant to the terms of this Warrant, such new Warrant (i) shall be of
like tenor with this Warrant, (ii) shall represent, as indicated on the face of
such new Warrant, the right to purchase the Warrant Shares then underlying this
Warrant (or in the case of a new Warrant being issued pursuant to Section ‎7‎(a)
or Section ‎7‎(e), 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. PIGGY-BACK REGISTRATIONS.  If at any time the Company shall determine to file
with the SEC a registration statement relating to an offering for its own
account or the account of others under the Securities Act of 1933, as amended of
any of its equity securities (other than on Form S-4 or Form S-8 or their then
equivalents relating to equity securities to be issued solely in connection with
any acquisition of any entity or business or equity securities issuable in
connection with stock option or other bona fide, employee benefit plans), the
Company shall send to each Holder written notice of such determination and, if
within fifteen (15) days after the effective date of such notice, such Holder
shall so request in writing, the Company shall include in such registration
statement all or any part of the Warrant Shares such Holder requests to be
registered, except that if, in connection with any underwritten public offering
for the account of the Company the managing underwriter(s) thereof shall impose
a limitation on the number of shares of Common Stock which may be included in
the registration statement because, in such underwriter(s)’ judgment, marketing
or other factors dictate such limitation is necessary to facilitate public
distribution, then the Company shall be obligated to include in such
registration statement only such limited portion of the Conversion Shares with
respect to which such Holder has requested inclusion hereunder as the
underwriter shall permit. Any exclusion of Shares shall

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be made pro rata among the Holders seeking to include Conversion Shares in
proportion to the number of Shares Securities sought to be included by such  

 

9. Holder.

 

1.

   

9.

NOTICES.  Whenever notice is required to be given under this Warrant, unless
otherwise provided herein, such notice shall be given in accordance with Section
5.3 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) as soon as practicable upon each
adjustment of the Exercise Price and the number of Warrant Shares, setting forth
in reasonable detail, and certifying, the calculation of such adjustment(s) and
(ii) at least fifteen (15) days prior to the date on which the Company closes
its books or takes a record (A) with respect to any dividend or distribution
upon the shares of Common Stock, (B) with respect to any grants, issuances or
sales of any Options, Convertible Securities or rights to purchase stock,
warrants, securities, indebtedness, or other property pro rata 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 (to the extent it constitutes, or contains, material,
non-public information regarding the Company shall be made known to the public
prior to or in conjunction with such notice being provided to the Holder and
(iii) at least ten (10) Trading Days prior to the consummation of any
Fundamental Transaction. To the extent that any notice provided hereunder
(whether under this Section 9 or otherwise) constitutes, or contains, material,
non-public information regarding the Company or any of its Subsidiaries, the
Company shall simultaneously file such notice with the SEC (as defined in the
Securities Purchase Agreement) pursuant to a Current Report on Form 8-K. It is
expressly understood and agreed that the time of execution specified by the
Holder in each Exercise Notice shall be definitive and may not be disputed or
challenged by the Company.

10. AMENDMENT AND WAIVER.  Except as otherwise provided herein, the provisions
of this Warrant may be amended and the Company may take any action herein
prohibited, or omit to perform any act herein required to be performed by it,
only if the Company has obtained the written consent of the Holder. The Holder
shall be entitled, at its option, to the benefit of any amendment of any other
similar warrant issued under the Securities Purchase Agreement. No waiver shall
be effective unless it is in writing and signed by an authorized representative
of the waiving party.

 

11. 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).

 

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12. GOVERNING LAW. This Warrant shall be governed by and construed and enforced
in accordance with, and all questions concerning the construction, validity,
interpretation and performance of this Warrant shall be governed by, the
internal laws of the State of New York, without giving effect to any 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. 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 or to enforce a judgment or
other court ruling in favor of the Holder. THE COMPANY HEREBY IRREVOCABLY WAIVES
ANY RIGHT IT MAY HAVE TO, AND AGREES NOT TO REQUEST, A JURY TRIAL FOR THE
ADJUDICATION OF ANY DISPUTE HEREUNDER OR IN CONNECTION WITH OR ARISING OUT OF
THIS WARRANT OR ANY TRANSACTION CONTEMPLATED HEREBY.

 

13. CONSTRUCTION; HEADINGS. This Warrant shall be deemed to be jointly drafted
by the Company and the Holder and shall not be construed against any Person as
the drafter hereof.  The headings of this Warrant are for convenience of
reference and shall not form part of, or affect the interpretation of, this
Warrant. Terms used in this Warrant but defined in the other Transaction
Documents shall have the meanings ascribed to such terms on the Closing Date (as
defined in the Securities Purchase Agreement) in such other Transaction
Documents unless otherwise consented to in writing by the Holder.

 

14. DISPUTE RESOLUTION. 

(a) Disputes Over the Exercise Price, Closing Sale Price, Bid Price, the Black
Scholes Value – FT or Fair Market Value.

(i) In the case of a dispute relating to the Exercise Price, the Closing Sale
Price, the Closing Bid Price, the Bid Price, the Black Scholes Value – FT or
fair market value (as the case may be) (including, without limitation, a dispute
relating to the determination of any of the foregoing), the Company or the
Holder (as the case may be) shall submit the dispute via facsimile (I) within
two (2) Business Days after delivery of the applicable notice giving rise to
such dispute to the Company or the Holder (as the case may be) or (II) if no
notice gave rise to such dispute, at any time after the Holder learned of the
circumstances giving rise to such dispute. If the Holder and the Company are
unable to resolve such dispute relating to the Exercise Price, the Exchange
Amount, the Exchange Price, the Closing Sale Price, the Closing Bid Price, the
Bid Price, the Black Scholes Value – FT or fair market value (as the case may
be) by 5:00 p.m. (New York time) on the second  (2nd) Business Day following
such delivery by the Company or

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the Holder (as the case may be) of such dispute to the Company or the Holder (as
the case may be), then the Holder shall select an independent, reputable
investment bank reasonably acceptable to the Company to resolve such dispute.

(ii) The Holder and the Company shall each deliver to such investment bank (x) a
copy of the initial dispute submission so delivered in accordance with the first
sentence of this Section ‎14‎(a) and (y) written documentation supporting its
position with respect to such dispute, in each case, no later than 5:00 p.m.
(New York time) by the fifth (5th) Business Day immediately following the date
on which the Holder selected such investment bank (the “Dispute Submission
Deadline”) (the documents referred to in the immediately preceding clauses (x)
and (y) are collectively referred to herein as the “Required Dispute
Documentation”) (it being understood and agreed that if either the Holder or the
Company fails to so deliver all of the Required Dispute Documentation by the
Dispute Submission Deadline, then the party who fails to so submit all of the
Required Dispute Documentation shall no longer be entitled to (and hereby waives
its right to) deliver or submit any written documentation or other support to
such investment bank with respect to such dispute and such investment bank shall
resolve such dispute based solely on the Required Dispute Documentation that was
delivered to such investment bank prior to the Dispute Submission Deadline).
Unless otherwise agreed to in writing by both the Company and the Holder or
otherwise requested by such investment bank, neither the Company nor the Holder
shall be entitled to deliver or submit any written documentation or other
support to such investment bank in connection with such dispute (other than the
Required Dispute Documentation).

(iii) The Company and the Holder shall cause such investment bank to determine
the resolution of such dispute and notify the Company and the Holder of such
resolution no later than ten (10) Business Days immediately following the
Dispute Submission Deadline. The fees and expenses of such investment bank shall
be borne by the Company (provided that such fees and expenses shall be borne
equally by the Company and the Holder only if such investment bank’s
determination of the disputed Exercise Price, Exchange Amount, Exchange Price,
Closing Sale Price, Closing Bid Price, Bid Price, Black Scholes Value – FT or
fair market value (as the case may be) was  equal to or greater than 98% of the
Company’s determination thereof that gave rise to the applicable dispute), and
such investment bank’s resolution of such dispute shall be final and binding
upon all parties absent manifest error.

(b) Disputes Over Arithmetic Calculation of Warrant Shares.  

 

(i) In the case of a dispute as to the arithmetic calculation of the number of
Warrant Shares, the Company or the Holder (as the case may be) shall submit the
disputed arithmetic calculation via facsimile (i) within two (2) Business Days
after delivery of the applicable notice giving rise to such dispute to the
Company or the Holder (as the case may be) or (ii) if no notice gave rise to
such dispute, at any time after the Holder learned of the circumstances giving
rise to such dispute. If the Holder and the Company are unable to resolve such
disputed arithmetic calculation of the number of Warrant Shares by 5:00 p.m.
(New York time) on the second (2nd) Business Day following such delivery by the
Company or the Holder (as the case may be) of such

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disputed arithmetic calculation of the number of Warrant Shares to the Company
or the Holder (as the case may be), then the Holder shall select an independent,
reputable accountant or accounting firm to perform such disputed arithmetic
calculation of the number of Warrant Shares.

(ii) The Holder and the Company shall each deliver to such accountant or
accounting firm (as the case may be) (x) a copy of the initial dispute
submission so delivered in accordance with the first sentence of this Section
‎14‎(b) and (y) written documentation supporting its position with respect to
such disputed arithmetic calculation of the number of Warrant Shares, in each
case, no later than 5:00 p.m. (New York time) by the fifth (5th) Business Day
immediately following the date on which the Holder selected such accountant or
accounting firm (as the case may be) (the “Submission Deadline”) (the documents
referred to in the immediately preceding clauses (x) and (y) are collectively
referred to herein as the “Required Documentation”) (it being understood and
agreed that if either the Holder or the Company fails to so deliver all of the
Required Documentation by the Submission Deadline, then the party who fails to
so submit all of the Required Documentation shall no longer be entitled to (and
hereby waives its right to) deliver or submit any written documentation or other
support to such accountant or accounting firm (as the case may be) with respect
to such disputed arithmetic calculation of the number of Warrant Shares and such
accountant or accounting firm (as the case may be) shall perform such disputed
arithmetic calculation of the number of Warrant Shares based solely on the
Required Documentation that was delivered to such accountant or accounting firm
(as the case may be) prior to the Submission Deadline). Unless otherwise agreed
to in writing by both the Company and the Holder or otherwise requested by such
accountant or accounting firm (as the case may be), neither the Company nor the
Holder shall be entitled to deliver or submit any written documentation or other
support to such accountant or accounting firm (as the case may be) in connection
with such disputed arithmetic calculation of the number of Warrant Shares (other
than the Required Documentation).

(iii) The Company and the Holder shall cause such accountant or accounting firm
(as the case may be) to perform such disputed arithmetic calculation and notify
the Company and the Holder of the results no later than ten (10) Business Days
immediately following the Submission Deadline. The fees and expenses of such
accountant or accounting firm (as the case may be) shall be borne solely by the
Company, and such accountant’s or accounting firm’s (as the case may be)
arithmetic calculation shall be final and binding upon all parties absent
manifest error.

(c) Miscellaneous. The Company expressly acknowledges and agrees that (i) this
Section ‎144 constitutes an agreement to arbitrate between the Company and the
Holder (and constitutes an arbitration agreement) under § 7501, et seq. of the
New York Civil Practice Law and Rules (“CPLR”) and that each party is authorized
to apply for an order to compel arbitration pursuant to CPLR § 7503(a) in order
to compel compliance with this Section ‎144, (ii) a dispute relating to the
Exercise Price includes, without limitation, disputes as to whether an
agreement, instrument, security or the like constitutes and Option or
Convertible Security, (iii) the terms of this Warrant and each other applicable
Transaction Document shall serve as the basis for the selected investment bank’s
resolution of the applicable dispute, such investment bank shall be

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entitled (and is hereby expressly authorized) to make all findings,
determinations and the like that such investment bank determines are required to
be made by such investment bank in connection with its resolution of such
dispute (including, without limitation, determining whether an agreement,
instrument, security or the like constitutes and Option or Convertible Security)
and in resolving such dispute such investment bank shall apply such findings,
determinations and the like to the terms of this Warrant and any other
applicable Transaction Documents, (iv) the terms of this Warrant and each other
applicable Transaction Document shall serve as the basis for the selected
accountant’s or accounting firm’s performance of the applicable arithmetic
calculation of the number of Warrant Shares, (v) for clarification purposes and
without implication that the contrary would otherwise be true, disputes relating
to matters described in Section ‎14‎(a) shall be governed by Section ‎14‎(a) and
not by Section ‎14‎(b), (vi) the Holder (and only the Holder), in its sole
discretion, shall have the right to submit any dispute described in this Section
‎14 to any state or federal court sitting in The City of New York, Borough of
Manhattan in lieu of utilizing the procedures set forth in this Section ‎14 and
(vii) nothing in this Section ‎14 shall limit the Holder from obtaining any
injunctive relief or other equitable remedies (including, without limitation,
with respect to any matters described in Section ‎14‎(a) or Section ‎14‎(b)).

 

15. REMEDIES, CHARACTERIZATION, OTHER OBLIGATIONS, BREACHES AND INJUNCTIVE
RELIEF. The remedies provided in this Warrant shall be cumulative and in
addition to all other remedies available under this Warrant and the other
Transaction Documents, at law or in equity (including a decree of specific
performance and/or other injunctive relief), and nothing herein shall limit the
right of the Holder to pursue damages for any failure by the Company to comply
with the terms of this Warrant. The Company covenants to the Holder that there
shall be no characterization concerning this instrument other than as expressly
provided herein. Amounts set forth or provided for herein with respect to
payments, exercises and the like (and the computation thereof) shall be the
amounts to be received by the Holder and shall not, except as expressly provided
herein, be subject to any other obligation of the Company (or the performance
thereof). The Company acknowledges that a breach by it of its obligations
hereunder will cause irreparable harm to the Holder and that the remedy at law
for any such breach may be inadequate. The Company therefore agrees that, in the
event of any such breach or threatened breach, the holder of this Warrant shall
be entitled, in addition to all other available remedies, to an injunction
restraining any breach, without the necessity of showing economic loss and
without any bond or other security being required. The Company shall provide all
information and documentation to the Holder that is requested by the Holder to
enable the Holder to confirm the Company’s compliance with the terms and
conditions of this Warrant (including, without limitation, compliance with
Section ‎2 hereof). The issuance of shares and certificates for shares as
contemplated hereby upon the exercise of this Warrant shall be made without
charge to the Holder or such shares for any issuance tax or other costs in
respect thereof, provided that the Company shall not be required to pay any tax
which may be payable in respect of any transfer involved in the issuance and
delivery of any certificate in a name other than the Holder or its agent on its
behalf.

 

16. TRANSFER. This Warrant may be offered for sale, sold, transferred or
assigned without the consent of the Company.

 

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17. CERTAIN DEFINITIONS.  For purposes of this Warrant, the following terms
shall have the following meanings:

 

(a) “Bid Price” means, for any security as of the particular time of
determination, the bid price for such security on the Principal Market as
reported by Bloomberg as of such time of determination, or, if the Principal
Market is not the principal securities exchange or trading market for such
security, the bid price of such security on the principal securities exchange or
trading market where such security is listed or traded as reported by Bloomberg
as of such time of determination, or if the foregoing does not apply, the bid
price of such security in the over-the-counter market on the electronic bulletin
board for such security as reported by Bloomberg as of such time of
determination, or, if no bid price is reported for such security by Bloomberg as
of such time of determination, the average of the bid prices of all of the
market makers for such security as reported in the “pink sheets” by OTC Markets
Group Inc. (formerly Pink Sheets LLC) as of such time of determination. If the
Bid Price cannot be calculated for a security as of the particular time of
determination on any of the foregoing bases, the Bid Price of such security as
of such time of determination shall be the fair market value as mutually
determined by the Company and the Holder. If the Company and the Holder are
unable to agree upon the fair market value of such security, then such dispute
shall be resolved in accordance with the procedures in Section ‎144. All such
determinations shall be appropriately adjusted for any stock dividend, stock
split, stock combination or other similar transaction during such period.

(b) “Black Scholes Value” means the Black Scholes value of an option for one
share of Common Stock at the date of the applicable Cashless Exercise, as such
Black Scholes value is determined, calculated using the Black Scholes Option
Pricing Model obtained from the “OV” function on Bloomberg utilizing (i) an
underlying price per share equal to the Closing Bid Price of the Common Stock as
of Trading Day immediately preceding the Issuance Date (adjusted upward to the
same extent that the Exercise Price hereunder has been adjusted upward pursuant
to Section 2(a) hereof), (ii) a risk-free interest rate corresponding to the
U.S. Treasury rate for a period equal to the remaining term of the Warrant as of
the applicable Cashless Exercise, (iii) a strike price equal to the Exercise
Price in effect at the time of the applicable Cashless Exercise, (iv) an
expected volatility equal to 135%,  and (v) a deemed remaining term of the
Warrant of five  (5) years  (regardless of the actual remaining term of the
Warrant).

(c) “Black Scholes Value -- FT” means the value of the unexercised portion of
this Warrant remaining on the date of the Holder’s request pursuant to Section
‎4(c), which value is calculated using the Black Scholes Option Pricing Model
obtained from the “OV” function on Bloomberg utilizing (i) an underlying price
per share equal to the greater of (1) the highest Closing Sale Price of the
Common Stock during the period beginning on the Trading Day immediately
preceding the earliest to occur of (x) the public disclosure of the applicable
Fundamental Transaction, (y) the consummation of the applicable Fundamental
Transaction and (z) the date on which the Holder first became aware of the
applicable Fundamental Transaction and ending on the Trading Day of the Holder’s
request pursuant to Section ‎4(c) and (2) the sum of the price per share being
offered in cash in the applicable Fundamental Transaction (if any) plus the
value of the non-cash consideration being offered in the applicable Fundamental
Transaction (if any), (ii) a strike price equal to the Exercise Price in effect
on the date of the Holder’s request pursuant to Section ‎4(c), (iii) a risk-free
interest rate corresponding to the U.S. Treasury rate for a period equal to the
greater of (1) the remaining term of this Warrant as of the

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date of the Holder’s request pursuant to Section ‎4(c) and (2) the remaining
term of this Warrant as of the date of consummation of the applicable
Fundamental Transaction or as of the date of the Holder’s request pursuant to
Section ‎4(c) if such request is prior to the date of the consummation of the
applicable Fundamental Transaction and (iv) an expected volatility equal to the
greater of 135% and the 100 day volatility obtained from the HVT function on
Bloomberg (determined utilizing a 365 day annualization factor) as of the
Trading Day immediately following the earliest to occur of (x) the public
disclosure of the applicable Fundamental Transaction, (y) the consummation of
the applicable Fundamental Transaction and (z) the date on which the Holder
first became aware of the applicable Fundamental Transaction.

(d) “Bloomberg” means Bloomberg, L.P.

(e) “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) “Closing Bid Price” and “Closing Sale Price” means, for any security as of
any date, the last closing bid price and the last closing trade price,
respectively, for such security on the Principal Market, as reported by
Bloomberg, or, if the Principal Market begins to operate on an extended hours
basis and does not designate the closing bid price or the closing trade price
(as the case may be) then the last bid price or last trade price, respectively,
of such security prior to 4:00:00 p.m., New York time, as reported by Bloomberg,
or, if the Principal Market is not the principal securities exchange or trading
market for such security, the last closing bid price or last trade price,
respectively, of such security on the principal securities exchange or trading
market where such security is listed or traded as reported by Bloomberg, or if
the foregoing do not apply, the average of the bid prices, or the ask prices,
respectively, of all of the market makers for such security as reported in the
“pink sheets” by OTC Markets Group Inc. (formerly Pink Sheets LLC). 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 in accordance with the
procedures in Section ‎14. All such determinations shall be appropriately
adjusted for any stock dividend, stock split, stock combination or other similar
transaction during such period.

(g) “Common Stock” means (i) the Company’s shares of common stock, $0.01 par
value per share, and (ii) any capital stock into which such common stock shall
have been changed or any share capital resulting from a reclassification of such
common stock.

(h) “Common Stock Deemed Outstanding” means, as of the particular time of
determination, the number of shares of Common Stock actually issued and
outstanding at such time (but excluding any issued and outstanding shares of
Common Stock owned or held by or for the account of the Company). 

(i) “Convertible Securities” means any stock, note, debenture or other security
(other than Options) that is, or may become, at any time and under any
circumstances, directly or

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indirectly, convertible into, exercisable or exchangeable for, or which
otherwise entitles the holder thereof to acquire, any shares of Common Stock.

(j) “Eligible Market” means the NYSE MKT, the New York Stock Exchange, the
Nasdaq Global Select Market, the Nasdaq Global Market, the Principal Market, the
OTCQX or the OTCQB (or any successor to any of the foregoing).

(k) “Expiration Date” means the five  (5) year anniversary of the Issuance Date,
or, if such date falls on a day other than a Business Day or on which trading
does not take place on the Principal Market (a “Holiday”), the next date that is
not a Holiday.

(l) “Fundamental Transaction” means that except as contemplated in the Proposed
Transactions (as that term is defined in the Securities Purchase Agreement) (i)
the Company, directly or indirectly, in one or more related transactions effects
any merger or consolidation of the Company with or into another Person and the
Company is not the surviving entity, (ii) the Company, directly or indirectly,
effects any sale, lease, license, assignment, transfer, conveyance or other
disposition of all or substantially all of its assets in one or a series of
related transactions, (iii) any, direct or indirect, purchase offer, tender
offer or exchange offer (whether by the Company or another Person) is completed
pursuant to which  Holder of Common Stock are permitted to sell, tender or
exchange their shares for other securities, cash or property and has been
accepted by the Holder of 50% or more of the outstanding Common Stock, (iv) the
Company, directly or indirectly, in one or more related transactions effects any
reclassification, reorganization or recapitalization of the Common Stock or any
compulsory share exchange pursuant to which the Common Stock is effectively
converted into or exchanged for other securities, cash or property, (v) the
Company, directly or indirectly, in one or more related transactions consummates
a stock or share purchase agreement or other business combination (including,
without limitation, a reorganization, recapitalization, spin-off or scheme of
arrangement) with another  Person whereby such other Person acquires more than
50% of the outstanding shares of Common Stock (not including any shares of
Common Stock held by the other Person or other Persons making or party to, or
associated or affiliated with the other Persons  making or party to, such stock
or share purchase agreement or other business combination).

(m) “Options” means any rights, warrants or options to subscribe for or purchase
shares of Common Stock or Convertible Securities.

(n) “Parent Entity” of a Person means an entity that, directly or indirectly,
controls the applicable Person and whose common stock or equivalent equity
security is quoted or listed on an Eligible Market, or, if there is more than
one such Person or Parent Entity, the Person or Parent Entity with the largest
public market capitalization as of the date of consummation of the Fundamental
Transaction.

(o) “Person” means an individual, a limited liability company, a partnership, a
joint venture, a corporation, a trust, an unincorporated organization, any other
entity or a government or any department or agency thereof.

(p) “Principal Market” means the Nasdaq Capital Market.  

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(q) “Successor Entity” means the Person (or, if so elected by the Holder, the
Parent Entity) formed by, resulting from or surviving any Fundamental
Transaction or the Person (or, if so elected by the Holder, the Parent Entity)
with which such Fundamental Transaction shall have been entered into.

(r) “Trading Day” means, as applicable, (x) with respect to all price
determinations relating to the Common Stock, any day on which the Common Stock
is traded on the Principal Market, or, if the Principal Market is not the
principal trading market for the Common Stock, then on the principal securities
exchange or securities market on which the Common Stock is then traded, provided
that “Trading Day” shall not include any day on which the Common Stock is
scheduled to trade on such exchange or market for less than 4.5 hours or any day
that the Common Stock is suspended from trading during the final hour of trading
on such exchange or market (or if such exchange or market does not designate in
advance the closing time of trading on such exchange or market, then during the
hour ending at 4:00:00 p.m., New York time) unless such day is otherwise
designated as a Trading Day in writing by the Holder or (y) with respect to all
determinations other than price determinations relating to the Common Stock, any
day on which The New York Stock Exchange (or any successor thereto) is open for
trading of securities.

(s)  “VWAP” means, for any security as of any date, the dollar volume-weighted
average price for such security on the Principal Market (or, if the Principal
Market is not the principal trading market for such security, then on the
principal securities exchange or securities market on which such security is
then traded) during the period beginning at 9:30:01 a.m., New York time, and
ending at 4:00:00 p.m., New York time, 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, and ending at 4:00:00 p.m., New York time, as
reported by Bloomberg, or, if no dollar volume-weighted average price is
reported for such security by Bloomberg for such hours, the average of the three
highest closing bid prices and the three lowest closing ask prices of all of the
market makers for such security as reported in the “pink sheets” by OTC Markets
Group Inc. (formerly Pink Sheets LLC). If VWAP cannot be calculated for such
security on such date on any of the foregoing bases, the VWAP of such security
on such date shall be the fair market value as mutually determined by the
Company and the Holder. If the Company and the Holder are unable to agree upon
the fair market value of such security, then such dispute shall be resolved in
accordance with the procedures in Section ‎14. All such determinations shall be
appropriately adjusted for any stock dividend, stock split, stock combination or
other similar transaction during such period.

 

 [signature page follows]

19

 

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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.

PRECIPIO, INC.

 

                                                           By:____________________________________

  Name: Ilan Danieli

 Title: CEO

[Signature Page to Warrant to Purchase Common Stock]

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EXHIBIT A

EXERCISE NOTICE

TO BE EXECUTED BY THE REGISTERED HOLDER TO EXERCISE THIS

WARRANT TO PURCHASE COMMON STOCK

PRECIPO, INC.

The undersigned holder hereby exercises the right to purchase _________________
of the shares of Common Stock (“Warrant Shares”) of Precipio, Inc., a Delaware
corporation (the “Company”), evidenced by Warrant to Purchase Common Stock No.
_______ (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.

In the event that the Holder has elected a Cashless Exercise with respect to
some or all of the Warrant Shares, the Holder represents and warrants that the
Exchange Amount is $___________ and, if the Company is permitted to elect to
issue shares of Common Stock, ____________ shares of Common Stock are to be
delivered to Holder as the Net Number pursuant to such Cashless Exercise, as
further specified in Annex A to this Exercise Notice.

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, 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 and Net Number of shares of Common Stock.  The
Company shall deliver to Holder, or its designee or agent as specified below,
__________ shares of Common Stock in respect of the exercise contemplated
hereby.  Delivery shall be made to Holder, or for its benefit, to the following
address:

 

_______________________

_______________________

_______________________

_______________________

Date: _______________ __, ______

 

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  Name of Registered Holder

By:

Name:

Title:

Account Number:
  (if electronic book entry transfer)

Transaction Code Number:
  (if electronic book entry transfer)

 

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ANNEX A TO EXERCISE NOTICE

CASHLESS EXERCISE EXCHANGE CALCULATION

TO BE FILLED IN BY THE REGISTERED HOLDER TO EXCHANGE THIS

WARRANT TO PURCHASE COMMON STOCK FOR COMMON STOCK IN A CASHLESS EXERCISE
PURSUANT TO SECTION 1(d) OF THE WARRANT

Capitalized terms used herein and not otherwise defined shall have the
respective meanings set forth in the Warrant.

Net Number = (A x B) - (A x C)

B

 

For purposes of the foregoing formula:

A= the total number of shares with respect to which this Warrant is then being
exercised.

B= the arithmetic average of the Closing Sale Prices for the five (5)
consecutive Trading Days ending on the date immediately preceding the date of
the Exercise Notice.

C= the Exercise Price then in effect for the applicable Warrant Shares at the
time of such exercise.

 

 

Date: _______________ __, ______

  Name of Registered Holder

By:

Name:

Title:

 

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EXHIBIT B

ACKNOWLEDGMENT

The Company hereby acknowledges this Exercise Notice and hereby directs
EQ Shareowner Services to issue the above indicated number of shares of Common
Stock.

PRECIPIO,  INC.

By:_____________________________________________________________________________________________
Name:
Title:

 

 

 

 

 

 

 

 

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