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Form of Warrant Agreement

THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED (THE “ACT”), OR UNDER THE SECURITIES LAWS OF ANY STATE.
THESE SECURITIES ARE SUBJECT TO RESTRICTIONS ON TRANSFERABILITY AND RESALE AND
MAY NOT BE OFFERED, SOLD, TRANSFERRED, PLEDGED OR HYPOTHECATED UNLESS PERMITTED
UNDER THE ACT AND APPLICABLE STATE SECURITIES LAWS PURSUANT TO REGISTRATION OR
EXEMPTION THEREFROM AND THE ISSUER OF THESE SECURITIES HAS BEEN PROVIDED WITH AN
OPINION OF LEGAL COUNSEL TO THE HOLDER IN FORM AND SUBSTANCE SATISFACTORY TO THE
ISSUER OF THESE SECURITIES TO THE EFFECT THAT SUCH OFFER, SALE, TRANSFER, PLEDGE
OR HYPOTHECATION IS EXEMPT FROM REGISTRATION UNDER SUCH LAWS.

        Date of Issuance: _________, 2013 Number of Shares _________ Warrant No.
____ (subject to adjustment)         ECHO AUTOMOTIVE, INC.  A NEVADA
CORPORATION   

Warrant

     Echo Automotive, Inc., a Nevada corporation (the “Company”), for value
received, hereby certifies that _______________________(the “Initial Holder”),
or its registered assigns (the Initial Holder or such registered assigns shall
be referred to as the “Registered Holder”), is entitled, subject to the terms
set forth below, to purchase from the Company at any time on or after the
Exercise Date and on or before the Expiration Date, up to ___________shares (the
“Warrant Shares”) of the Company’s common stock, $0.001 par value per share
(“Common Stock”), at a purchase price $______per share (the “Purchase Price”).
The number of shares of Warrant Shares and the Purchase Price may be adjusted
from time to time pursuant to the provisions of this Warrant. As used herein,
“Exercise Date” means any date after the date hereof and prior to the Expiration
Date on which the Registered Holder elects by written notice to the Company to
exercise this Warrant.

     This Warrant is issued pursuant to that Securities Purchase Agreement,
dated as of ___________, 2013, by and among the Company and the Initial Holder
(the “Purchase Agreement”).

     1.      Exercise.

          (a)      Manner of Exercise. This Warrant may be exercised by the
Registered Holder, in whole or in part, by surrendering this Warrant, with the
purchase/exercise form appended hereto as Exhibit A duly executed by such
Registered Holder or by such Registered Holder’s duly authorized attorney, at
the principal office of the Company, or at such other office or agency as the
Company may designate in writing, accompanied by payment in full of the Purchase
Price payable in respect of the number of shares of Warrant Shares purchased
upon such exercise. The Purchase Price may be paid by cash, check, or wire
transfer.

          (b)      Effective Time of Exercise. Each exercise of this Warrant
shall be deemed to have been effected immediately prior to the close of business
on the day on which this Warrant shall have been surrendered to the Company as
provided in Section 1(a) above. At such time, the person or persons in whose
name or names any certificates for Warrant Shares shall be issuable upon such
exercise as provided in Section 1(c) below shall be deemed to have become the
holder or holders of record of the Warrant Shares represented by such
certificates.

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          (c)      Delivery to Holder. As soon as practicable after the exercise
of this Warrant, in whole or in part, and in any event within ten (10) days
thereafter, the Company at its expense will cause to be issued in the name of,
and delivered to, the Registered Holder, or as such Holder (upon payment by such
Holder of any applicable transfer taxes) may direct:

                    (i)      a certificate or certificates for the number of
shares of Warrant Shares to which such Registered Holder shall be entitled, and

                    (ii)      in case such exercise is in part only, a new
warrant or warrants (dated the date hereof) of like tenor, calling in the
aggregate on the face or faces thereof for the number of shares of Warrant
Shares equal (without giving effect to any adjustment therein) to the number of
such shares called for on the face of this Warrant minus the number of such
shares purchased by the Registered Holder upon such exercise as provided in
Section 1(a) above.

     2.      Adjustments.

          (a)      Stock Splits and Dividends. If outstanding shares of the
Company’s Common Stock shall be subdivided into a greater number of shares or a
dividend in Common Stock shall be paid in respect of Common Stock, then the
Purchase Price in effect immediately prior to such subdivision or at the record
date of such dividend shall simultaneously with the effectiveness of such
subdivision or immediately after the record date of such dividend be
proportionately reduced. If outstanding shares of Common Stock shall be combined
into a smaller number of shares, then the Purchase Price in effect immediately
prior to such combination shall, simultaneously with the effectiveness of such
combination, be proportionately increased. When any adjustment is required to be
made in the Purchase Price, the number of shares of Warrant Shares purchasable
upon the exercise of this Warrant shall be changed to the number determined by
dividing (i) an amount equal to the number of shares issuable upon the exercise
of this Warrant immediately prior to such adjustment, multiplied by the Purchase
Price in effect immediately prior to such adjustment, by (ii) the Purchase Price
in effect immediately after such adjustment.

          (b)      Reclassification, Etc. In case of any reclassification or
change of the outstanding securities of the Company or of any reorganization of
the Company (or any other corporation the stock or securities of which are at
the time receivable upon the exercise of this Warrant) or any similar corporate
reorganization on or after the date hereof, then and in each such case the
Registered Holder, upon the exercise hereof at any time after the consummation
of such reclassification, change, reorganization, merger or conveyance, shall be
entitled to receive, in lieu of the stock or other securities and property
receivable upon the exercise hereof prior to such consummation, the stock or
other securities or property to which such holder would have been entitled upon
such consummation if such holder had exercised this Warrant immediately prior
thereto, all subject to further adjustment as provided in this Section 2; and in
each such case, the terms of this Section 2 shall be applicable to the shares of
stock or other securities properly receivable upon the exercise of this Warrant
after such consummation.

          (c)      Adjustment Certificate. When any adjustment is required to be
made in the Warrant Shares or the Purchase Price pursuant to this Section 2, the
Company shall promptly mail to the Registered Holder a certificate setting forth
(i) a brief statement of the facts requiring such adjustment, (ii) the Purchase
Price after such adjustment and (iii) the kind and amount of stock or other
securities or property into which this Warrant shall be exercisable after such
adjustment.

     3.      Transfers.

          (a)      Unregistered Security. This Warrant and the Warrant Shares
have not been registered under the Securities Act of 1933, as amended (the
“Securities Act”), and may not be sold, pledged, distributed, offered for sale,
transferred or otherwise disposed of in the absence of (i) an effective
registration statement under the Securities Act as to this Warrant or such
Warrant Shares and registration or qualification of this Warrant or such Warrant
Shares under any applicable U.S. federal or state securities law then in effect,
or (ii) an opinion of counsel, reasonably satisfactory to the Company, that such
registration or qualification is not required. Each certificate or other
instrument for Warrant Shares issued upon the exercise of this Warrant shall
bear a legend substantially to the foregoing effect.

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          (b)      Transferability. Subject to the provisions of Section 3(a)
hereof and subject to the Company’s approval, this Warrant and all rights
hereunder are transferable, in whole or in part, upon surrender of the Warrant
with a properly executed assignment (in the form of Exhibit B hereto) at the
principal office of the Company.

          (c)      Warrant Register. The Company will maintain a register
containing the names and addresses of the Registered Holders of this Warrant.
Until any transfer of this Warrant is made in the warrant register, the Company
may treat the Registered Holder as the absolute owner hereof for all purposes;
provided, however, that if this Warrant is properly assigned in blank, the
Company may (but shall not be required to) treat the bearer hereof as the
absolute owner hereof for all purposes, notwithstanding any notice to the
contrary. Any Registered Holder may change such Registered Holder’s address as
shown on the warrant register by written notice to the Company requesting such
change.

     4.      No Impairment. The Company will not, by amendment of its charter or
through reorganization, consolidation, merger, dissolution, sale of assets or
any other voluntary action, avoid or seek to avoid the observance or performance
of any of the terms of this Warrant, but will (subject to Section 11 below) at
all times in good faith assist in the carrying out of all such terms and in the
taking of all such action as may be necessary or appropriate in order to protect
the rights of the Registered Holder against impairment.

     5.      Termination. This Warrant (and the right to purchase securities
upon exercise hereof) shall terminate five (5) years from the date of issuance
of this Warrant (the “Expiration Date”).

     6.      Notices of Certain Transactions. In the event:

          (a)      the Company shall take a record of the holders of its Common
Stock (or other stock or securities at the time deliverable upon the exercise of
this Warrant) for the purpose of entitling or enabling them to receive any
dividend or other distribution, or to receive any right to subscribe for or
purchase any shares of stock of any class or any other securities, or to receive
any other right, to subscribe for or purchase any shares of stock of any class
or any other securities, or to receive any other right, or

          (b)      of any capital reorganization of the Company, any
reclassification of the capital stock of the Company, or any consolidation or
merger of the Company with or into another corporation, or

          (c)      of the voluntary or involuntary dissolution, liquidation or
winding-up of the Company,

then, and in each such case, the Company will mail or cause to be mailed to the
Registered Holder a notice specifying, as the case may be, (i) the date on which
a record is to be taken for the purpose of such dividend, distribution or right,
and stating the amount and character of such dividend, distribution or right, or
(ii) the effective date on which such reclassification, reorganization,
consolidation, merger, dissolution, liquidation or winding-up is to take place,
and the time, if any is to be fixed, as of which the holders of record of
Warrant Shares shall be entitled to exchange their shares of Warrant Shares (or
such other stock or securities) for securities or other property deliverable
upon such reclassification, reorganization, consolidation, merger, dissolution,
liquidation or winding-up. Such notice shall be mailed at least ten (10) days
prior to the record date or effective date for the event specified in such
notice.

     7.      Reservation of Stock. The Company will at all times reserve and
keep available out of its authorized but unissued stock, solely for the issuance
and delivery upon the exercise of this Warrant and other similar Warrants, such
number of its duly authorized shares of Common Stock as from time to time shall
be issuable upon the exercise of this Warrant and other similar Warrants. All of
the shares of Common Stock issuable upon exercise of this Warrant and other
similar Warrants, when issued and delivered in accordance with the terms hereof
and thereof, will be duly authorized, validly issued, fully paid and
non-assessable, subject to no lien or other encumbrance other than restrictions
on transfer arising under applicable securities laws and restrictions imposed by
Section 3 hereof.

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     8.      Exchange of Warrants. Upon the surrender by the Registered Holder
of any Warrant or Warrants, properly endorsed, to the Company at the principal
office of the Company, the Company will, subject to the provisions of Section 3
hereof, issue and deliver to or upon the order of such Holder, at the Company’s
expense, a new Warrant or Warrants of like tenor, in the name of such Registered
Holder or as such Registered Holder (upon payment by such Registered Holder of
any applicable transfer taxes) may direct, calling in the aggregate on the face
or faces thereof for the number of shares of Common Stock called for on the face
or faces of the Warrant or Warrants so surrendered.

     9.      Replacement of Warrants. Upon receipt 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) upon delivery of an
indemnity agreement (with surety if reasonably required) in an amount reasonably
satisfactory to the Company, or (in the case of mutilation) upon surrender and
cancellation of this Warrant, the Company will issue, in lieu thereof, a new
Warrant of like tenor.

     10.      Notices. Any notice required or permitted by this Warrant shall be
in writing and shall be deemed sufficient upon receipt, when delivered
personally or by courier, overnight delivery service or confirmed facsimile, or
forty-eight (48) hours after being deposited in the regular mail as certified or
registered mail (airmail if sent internationally) with postage prepaid,
addressed (a) if to the Registered Holder, to the address of the Registered
Holder most recently furnished in writing to the Company and (b) if to the
Company, to the address set forth below or subsequently modified by written
notice to the Registered Holder.

     11.      No Rights as Stockholder. Until the exercise of this Warrant, the
Registered Holder shall not have or exercise any rights by virtue hereof as a
stockholder of the Company.

     12.      Representations of Registered Holder. By acceptance of this
Warrant, the Registered Holder hereby represents and acknowledges to the Company
that:

          (a)      this Warrant and the Warrant Shares are “restricted
securities” as such term is used in the rules and regulations under the
Securities Act and that such securities have not been and will not be registered
under the Securities Act or any state securities law, and that such securities
must be held indefinitely unless registration is effected or transfer can be
made pursuant to appropriate exemptions;

          (b)      the Registered Holder has read, and fully understands, the
terms of this Warrant set forth on its face and the attachments hereto,
including the restrictions on transfer contained herein;

          (c)      the Registered Holder is purchasing for investment for its
own account and not with a view to or for sale in connection with any
distribution of this Warrant and the Warrant Shares and it has no intention of
selling such securities in a public distribution in violation of the federal
securities laws or any applicable state securities laws; provided that nothing
contained herein will prevent the Registered Holder from transferring such
securities in compliance with the terms of this Warrant and the applicable
federal and state securities laws; and

          (d)      the Company may affix one or more legends, including a legend
in substantially the following form (in addition to any other legend(s), if any,
required by applicable state corporate and/or securities laws) to certificates
representing Warrant Shares:

> > > > > “THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE
> > > > > SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”), OR UNDER THE
> > > > > SECURITIES LAWS OF ANY STATE. THESE SECURITIES ARE SUBJECT TO
> > > > > RESTRICTIONS ON TRANSFERABILITY AND RESALE AND MAY NOT BE OFFERED,
> > > > > SOLD, TRANSFERRED, PLEDGED OR HYPOTHECATED UNLESS PERMITTED UNDER THE
> > > > > ACT AND APPLICABLE STATE SECURITIES LAWS PURSUANT TO REGISTRATION OR
> > > > > EXEMPTION THEREFROM AND THE ISSUER OF THESE SECURITIES HAS BEEN
> > > > > PROVIDED WITH AN OPINION OF LEGAL COUNSEL TO THE HOLDER IN FORM AND
> > > > > SUBSTANCE SATISFACTORY TO THE ISSUER OF THESE SECURITIES TO THE EFFECT
> > > > > THAT SUCH OFFER, SALE, TRANSFER, PLEDGE OR HYPOTHECATION IS EXEMPT
> > > > > FROM REGISTRATION UNDER SUCH LAWS.”

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     13.      No Fractional Shares. No fractional shares will be issued in
connection with any exercise hereunder. In lieu of any fractional shares which
would otherwise be issuable, the Company shall pay cash equal to the product of
such fraction multiplied by the fair market value of one such share on the date
of exercise, as determined in good faith by the Company’s Board of Directors.

     14.      Amendment or Waiver. Any term of this Warrant may be amended or
waived upon written consent of the Company and the Registered Holder.

     15.      Headings. The headings in this Warrant are for purposes of
reference only and shall not limit or otherwise affect the meaning of any
provision of this Warrant.

     16.      Governing Law. This Warrant shall be governed, construed and
interpreted in accordance with the laws of the State of Nevada, without giving
effect to principles of conflicts of law.

[Remainder of Page Intentionally Left Blank]

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     IN WITNESS WHEREOF, the Company has caused this Warrant to be duly executed
and delivered by its authorized officer as of the date first above written.

  ECHO AUTOMOTIVE, INC., a Nevada corporation           Signed:     By:    
Title:     Address: 16000 N. 80th Street, Suite E
Scottsdale, AZ 85260   Phone No.: (855) 324-6288

INITIAL HOLDER:     By:     Print Name:     Title:    

[SIGNATURE PAGE TO ECHO AUTOMOTIVE, INC. WARRANT]

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EXHIBIT A

PURCHASE/EXERCISE FORM

To:      ECHO AUTOMOTIVE, INC. Dated:_________________

     The undersigned, pursuant to the provisions set forth in the attached
Warrant No. ___ hereby irrevocably elects to purchase _____shares of the Common
Stock covered by such Warrant and herewith makes payment of $_________,
representing the full purchase price for such shares at the price per share
provided for in such Warrant.

     The undersigned acknowledges that it has reviewed the representations and
warranties contained in Section 12 of the Warrant and by its signature below
hereby makes such representations and warranties to the Company as of the date
hereof.

     The undersigned further acknowledges that it has reviewed that certain
Securities Purchase Agreement, dated as of ________, 2013, among the Company and
certain holders of the Company’s securities (as amended from time to time) and
agrees to be bound by such provisions.

  Signature:     Name (print):     Title (if applic.)     Company (if applic.):
 

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EXHIBIT B

ASSIGNMENT FORM

     FOR VALUE RECEIVED, _________________________________________hereby sells,
assigns and transfers all of the rights of the undersigned under the attached
Warrant with respect to the number of shares of Common Stock covered thereby set
forth below, to:

Name of Assignee Address/Fax Number No. of Shares

 

 

Dated:     Signature:                   Witness:  

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