Form of Representative’s Warrant Agreement


 


THE REGISTERED HOLDER
OF THIS PURCHASE WARRANT BY ITS ACCEPTANCE HEREOF, AGREES THAT IT WILL NOT SELL, TRANSFER OR ASSIGN THIS PURCHASE WARRANT EXCEPT
AS HEREIN PROVIDED AND THE REGISTERED HOLDER OF THIS PURCHASE WARRANT AGREES THAT IT WILL NOT SELL, TRANSFER, ASSIGN, PLEDGE OR
HYPOTHECATE THIS PURCHASE WARRANT FOR A PERIOD OF ONE YEAR FOLLOWING THE EFFECTIVE DATE (DEFINED BELOW) TO ANYONE OTHER THAN (I)
AEGIS CAPITAL CORP. OR AN UNDERWRITER OR A SELECTED DEALER IN CONNECTION WITH THE OFFERING, OR (II) A BONA FIDE OFFICER OR PARTNER
OF AEGIS CAPITAL CORP. OR OF ANY SUCH UNDERWRITER OR SELECTED DEALER.


 


THIS PURCHASE WARRANT
IS NOT EXERCISABLE PRIOR TO AUGUST 20, 2013. VOID AFTER 5:00 P.M., EASTERN TIME, AUGUST 20, 2017.


 


 


COMMON STOCK PURCHASE WARRANT


 


For the Purchase of 300,000 Shares of Common
Stock


 


of


 


NEURALSTEM, INC.


 


 


1.Purchase
Warrant. THIS CERTIFIES THAT, in consideration of funds duly paid by or on behalf of _____________ (“Holder”),
as registered owner of this Purchase Warrant, to Neuralstem, Inc., a Delaware corporation (the “Company”), Holder
is entitled, at any time or from time to time from August 20, 2013 (the “Commencement Date”), and at or before
5:00 p.m., Eastern time, August 20, 2017  (the “Expiration Date”),
but not thereafter, to subscribe for, purchase and receive, in whole or in part, up to 300,000 shares of common stock of the Company,
par value $0.01 per share (the “Shares”), subject to adjustment as provided in Section 6 hereof. If the
Expiration Date is a day on which banking institutions are authorized by law to close, then this Purchase Warrant may be exercised
on the next succeeding day which is not such a day in accordance with the terms herein. During the period ending on the Expiration
Date, the Company agrees not to take any action that would terminate the Purchase Warrant. This Purchase Warrant is initially exercisable
at $0.50 per Share (125% of the price of the Shares sold in the Offering); provided, however, that upon the occurrence
of any of the events specified in Section 6 hereof, the rights granted by this Purchase Warrant, including the exercise
price per Share and the number of Shares to be received upon such exercise, shall be adjusted as therein specified. The term “Exercise
Price” shall mean the initial exercise price or the adjusted exercise price, depending on the context.


 


2.Exercise.


 


2.1Exercise
Form. In order to exercise this Purchase Warrant, the exercise form attached hereto must be duly executed and completed and
delivered to the Company, together with this Purchase Warrant and payment of the Exercise Price for the Shares being purchased
payable in cash by wire transfer of immediately available funds to an account designated by the Company or by check. If the subscription
rights represented hereby shall not be exercised at or before 5:00 p.m., Eastern time, on the Expiration Date, this Purchase Warrant
shall become and be void without further force or effect, and all rights represented hereby shall cease and expire.


 


2.2Cashless
Exercise.  In lieu of exercising this Purchase Warrant by payment of cash or check payable to the order of the Company
pursuant to Section 2.1 above, Holder may elect to receive the number of Shares equal to the value of this Purchase Warrant
(or the portion thereof being exercised), by surrender of this Purchase Warrant to the Company, together with the exercise form
attached hereto, in which event the issue to Holder, Shares in accordance with the following formula:


 






    	 



    	 



    
 


	X	=	Y(A-B)	 
	A	 
	Where,	X	=	The number of Shares to be issued to Holder;
	 	Y	=	The number of Shares for which the Purchase Warrant is being exercised;
	 	A	=	The fair market value of one Share; and
	 	B	=	The Exercise Price.
	 	 	 	 	 	 


 


           
For purposes of this Section 2.2, the fair market value of a Share is defined as follows:


 


                                        
(i)   if the Company’s common stock is traded on a securities exchange, the value shall be deemed to be the closing price
on such exchange prior to the exercise form being submitted in connection with the exercise of the Purchase Warrant; or


 


                                        
(ii)  if the Company’s common stock is actively traded over-the-counter, the value shall be deemed to be the closing bid
prior to the exercise form being submitted in connection with the exercise of the Purchase Warrant; if there is no active public
market, the value shall be the fair market value thereof, as determined in good faith by the Company’s Board of Directors.


 


2.3 Legend.
Each certificate for the securities purchased under this Purchase Warrant shall bear a legend as follows unless such securities
have been registered under the Securities Act of 1933, as amended (the “Act”):


 


“The securities
represented by this certificate have not been registered under the Securities Act of 1933, as amended (the “Act”),
or applicable state law. Neither the securities nor any interest therein may be offered for sale, sold or otherwise transferred
except pursuant to an effective registration statement under the Act, or pursuant to an exemption from registration under the Act
and applicable state law which, in the opinion of counsel to the Company, is available.”


 


3.Transfer.


 


3.1General Restrictions.
The registered Holder of this Purchase Warrant agrees by his, her or its acceptance hereof, that such Holder will not: (a) sell,
transfer, assign, pledge or hypothecate this Purchase Warrant for a period of one year following the date hereof (the “Effective
Date”) to anyone other than: (i) Aegis Capital Corp. (“Aegis”) or an underwriter or a selected dealer
participating in the Offering, or (ii) a bona fide officer or partner of Aegis or of any such underwriter or selected dealer, in
each case in accordance with FINRA Conduct Rule 5110(g)(1), or (b) cause this Purchase Warrant or the securities issuable hereunder
to be the subject of any hedging, short sale, derivative, put or call transaction that would result in the effective economic disposition
of this Purchase Warrant or the securities hereunder, except as provided for in FINRA Rule 5110(g)(2). On and after that date that
is one year after the Effective Date, transfers to others may be made subject to compliance with or exemptions from applicable
securities laws. In order to make any permitted assignment, the Holder must deliver to the Company the assignment form attached
hereto duly executed and completed, together with the Purchase Warrant and payment of all transfer taxes, if any, payable in connection
therewith. The Company shall within five (5) Business Days transfer this Purchase Warrant on the books of the Company and shall
execute and deliver a new Purchase Warrant or Purchase Warrants of like tenor to the appropriate assignee(s) expressly evidencing
the right to purchase the aggregate number of Shares purchasable hereunder or such portion of such number as shall be contemplated
by any such assignment.


 


3.2 Restrictions
Imposed by the Act. The securities evidenced by this Purchase Warrant shall not be transferred unless and until: (i) the Company
has received the opinion of counsel for the Holder that the securities may be transferred pursuant to an exemption from registration
under the Act and applicable state securities laws, the availability of which is established to the reasonable satisfaction of
the Company, or (ii) a registration statement or a post-effective amendment to the Registration Statement relating to the offer
and sale of such securities has been filed by the Company and declared effective by the U.S. Securities and Exchange Commission
(the “Commission”) and compliance with applicable state securities law has been established.


 






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4.Registration Rights.


 


4.1Demand Registration.


 


4.1.1Grant of
Right. The Company, upon written demand (a “Demand Notice”) of the Holder(s) of at least 51% of the Purchase
Warrants and/or the underlying Shares (“Majority Holders”), agrees to register, on one occasion, all or any
portion of the Shares underlying the Purchase Warrants (collectively, the “Registrable Securities”). On such
occasion, the Company will file a registration statement with the Commission covering the Registrable Securities within thirty
(30) days after receipt of a Demand Notice and use its reasonable best efforts to have the registration statement declared effective
promptly thereafter, subject to compliance with review by the Commission; provided, however, that the Company shall
not be required to comply with a Demand Notice if the Company has filed a registration statement with respect to which the Holder
is entitled to piggyback registration rights pursuant to Section 4.2 hereof and either: (i) the Holder has elected to participate
in the offering covered by such registration statement or (ii) if such registration statement relates to an underwritten primary
offering of securities of the Company, until the offering covered by such registration statement has been withdrawn or until thirty
(30) days after such offering is consummated. The demand for registration may be made at any time during a period of four (4) years
beginning one year after the Closing Date. The Company covenants and agrees to give written notice of its receipt of any Demand
Notice by any Holder(s) to all other registered Holders of the Purchase Warrants and/or the Registrable Securities within ten (10)
days after the date of the receipt of any such Demand Notice.


 


4.1.2 Terms.
The Company shall bear all fees and expenses attendant to the registration of the Registrable Securities pursuant to Section
4.1.1, but the Holders shall pay any and all underwriting commissions and the expenses of any legal counsel selected by the
Holders to represent them in connection with the sale of the Registrable Securities. The Company agrees to use its reasonable best
efforts to cause the filing required herein to become effective promptly and to qualify or register the Registrable Securities
in such States as are reasonably requested by the Holder(s); provided, however, that in no event shall the Company
be required to register the Registrable Securities in a State in which such registration would cause: (i) the Company to be obligated
to register or license to do business in such State or submit to general service of process in such State, or (ii) the principal
shareholders of the Company to be obligated to escrow their shares of capital stock of the Company. The Company shall cause any
registration statement filed pursuant to the demand right granted under Section 4.1.1 to remain effective for a period of
at least twelve (12) consecutive months after the date that the Holders of the Registrable Securities covered by such registration
statement are first given the opportunity to sell all of such securities. The Holders shall only use the prospectuses provided
by the Company to sell the shares covered by such registration statement, and will immediately cease to use any prospectus furnished
by the Company if the Company advises the Holder that such prospectus may no longer be used due to a material misstatement or omission.


 


4.2“Piggy-Back”
Registration.


 


4.2.1Grant of
Right. In addition to the demand right of registration described in Section 4.1 hereof, the Holder shall have the right,
for a period of four (4) years commencing one year after the Closing Date, to include the Registrable Securities as part of any
other registration of securities filed by the Company (other than in connection with a transaction contemplated by Rule 145 promulgated
under the Act or pursuant to Form S-8 or any equivalent form); provided, however, that if, solely in connection with
any primary underwritten public offering for the account of the Company, the managing underwriter(s) thereof shall, in its reasonable
discretion, 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 Registrable Securities
with respect to which the Holder requested inclusion hereunder as the underwriter shall reasonably permit. Any exclusion of Registrable
Securities shall be made pro rata among the Holders seeking to include Registrable Securities in proportion to the number of Registrable
Securities sought to be included by such Holders; provided, however, that the Company shall not exclude any Registrable
Securities unless the Company has first excluded all outstanding securities, the holders of which are not entitled to inclusion
of such securities in such Registration Statement or are not entitled to pro rata inclusion with the Registrable Securities.


 


4.2.2 Terms.
The Company shall bear all fees and expenses attendant to registering the Registrable Securities pursuant to Section 4.2.1
hereof, but the Holders shall pay any and all underwriting commissions and the expenses of any legal counsel selected by the Holders
to represent them in connection with the sale of the Registrable Securities. In the event of such a proposed registration, the
Company shall furnish the then Holders of outstanding Registrable Securities with not less than thirty (30) days written notice
prior to the proposed date of filing of such registration statement. Such notice to the Holders shall continue to be given for
each registration statement filed by the Company until such time as all of the Registrable Securities have been sold by the Holder.
The holders of the Registrable Securities shall exercise the “piggy-back” rights provided for herein by giving written
notice, within ten (10) days of the receipt of the Company’s notice of its intention to file a registration statement. Except
as otherwise provided in this Purchase Warrant, there shall be no limit on the number of times the Holder may request registration
under this Section 4.2.2.


 






    	-3-



    	 



    
 


4.3General Terms.


 


4.3.1Indemnification.
The Company shall indemnify the Holder(s) of the Registrable Securities to be sold pursuant to any registration statement hereunder
and each person, if any, who controls such Holders within the meaning of Section 15 of the Act or Section 20 (a) of the Securities
Exchange Act of 1934, as amended (“Exchange Act”), against all loss, claim, damage, expense or liability (including
all reasonable attorneys’ fees and other expenses reasonably incurred in investigating, preparing or defending against any
claim whatsoever) to which any of them may become subject under the Act, the Exchange Act or otherwise, arising from such registration
statement but only to the same extent and with the same effect as the provisions pursuant to which the Company has agreed to indemnify
the Underwriters contained in Section 7(a) of the Underwriting Agreement between the Underwriters and the Company, dated as of
August 14, 2012. The Holder(s) of the Registrable Securities to be sold pursuant to such registration statement, and their successors
and assigns, shall severally, and not jointly, indemnify the Company, against all loss, claim, damage, expense or liability (including
all reasonable attorneys’ fees and other expenses reasonably incurred in investigating, preparing or defending against any
claim whatsoever) to which they may become subject under the Act, the Exchange Act or otherwise, arising from information furnished
by or on behalf of such Holders, or their successors or assigns, in writing, for specific inclusion in such registration statement
to the same extent and with the same effect as the provisions contained in Section 7(b) of the Underwriting Agreement pursuant
to which the Underwriters have agreed to indemnify the Company.


 


4.3.2 Exercise
of Purchase Warrants. Nothing contained in this Purchase Warrant shall be construed as requiring the Holder(s) to exercise
their Purchase Warrants prior to or after the initial filing of any registration statement or the effectiveness thereof.


 


4.3.3 Documents
Delivered to Holders. The Company shall furnish to each Holder participating in any of the foregoing offerings and to each
underwriter of any such offering, if any, a signed counterpart, addressed to such Holder or underwriter, of: (i) an opinion of
counsel to the Company, dated the effective date of such registration statement (and, if such registration includes an underwritten
public offering, an opinion dated the date of the closing under any underwriting agreement related thereto), and (ii) a “cold
comfort” letter dated the effective date of such registration statement (and, if such registration includes an underwritten
public offering, a letter dated the date of the closing under the underwriting agreement) signed by the independent registered
public accounting firm which has issued a report on the Company’s financial statements included in such registration statement,
in each case covering substantially the same matters with respect to such registration statement (and the prospectus included therein)
and, in the case of such accountants’ letter, with respect to events subsequent to the date of such financial statements,
as are customarily covered in opinions of issuer’s counsel and in accountants’ letters delivered to underwriters in
underwritten public offerings of securities. The Company shall also deliver promptly to each Holder participating in the offering
requesting the correspondence and memoranda described below and to the managing underwriter, if any, copies of all correspondence
between the Commission and the Company, its counsel or auditors and all memoranda relating to discussions with the Commission or
its staff with respect to the registration statement and permit each Holder and underwriter to do such investigation, upon reasonable
advance notice, with respect to information contained in or omitted from the registration statement as it deems reasonably necessary
to comply with applicable securities laws or rules of FINRA. Such investigation shall include access to books, records and properties
and opportunities to discuss the business of the Company with its officers and independent auditors, all to such reasonable extent
and at such reasonable times as any such Holder shall reasonably request.


 






    	-4-



    	 



    
 


4.3.4 Underwriting
Agreement. The Company shall enter into an underwriting agreement with the managing underwriter(s), if any, selected by any
Holders whose Registrable Securities are being registered pursuant to this Section 4, which managing underwriter shall be
reasonably satisfactory to the Company. Such agreement shall be reasonably satisfactory in form and substance to the Company, each
Holder and such managing underwriters, and shall contain such representations, warranties and covenants by the Company and such
other terms as are customarily contained in agreements of that type used by the managing underwriter. The Holders shall be parties
to any underwriting agreement relating to an underwritten sale of their Registrable Securities and may, at their option, require
that any or all the representations, warranties and covenants of the Company to or for the benefit of such underwriters shall also
be made to and for the benefit of such Holders. Such Holders shall not be required to make any representations or warranties to
or agreements with the Company or the underwriters except as they may relate to such Holders, their Shares and their intended methods
of distribution.


 


4.3.5 Documents
to be Delivered by Holder(s). Each of the Holder(s) participating in any of the foregoing offerings shall furnish to the Company
a completed and executed questionnaire provided by the Company requesting information customarily sought of selling security holders.


 


4.3.6 Damages.
Should the registration or the effectiveness thereof required by Section 4.1 and Section 4.2 hereof be delayed by
the Company or the Company otherwise fails to comply with such provisions, the Holder(s) shall, in addition to any other legal
or other relief available to the Holder(s), be entitled to obtain specific performance or other equitable (including injunctive)
relief against the threatened breach of such provisions or the continuation of any such breach, without the necessity of proving
actual damages and without the necessity of posting bond or other security.


 


5.New Purchase Warrants to be Issued.


 


5.1Partial Exercise
or Transfer. Subject to the restrictions in Section 3 hereof, this Purchase Warrant may be exercised or assigned in
whole or in part. In the event of the exercise or assignment hereof in part only, upon surrender of this Purchase Warrant for cancellation,
together with the duly executed exercise or assignment form and funds sufficient to pay any Exercise Price and/or transfer tax
if exercised pursuant to Section 2.1 hereof, the Company shall cause to be delivered to the Holder without charge a new
Purchase Warrant of like tenor to this Purchase Warrant in the name of the Holder evidencing the right of the Holder to purchase
the number of Shares purchasable hereunder as to which this Purchase Warrant has not been exercised or assigned.


 


5.2 Lost Certificate.
Upon receipt by the Company of evidence satisfactory to it of the loss, theft, destruction or mutilation of this Purchase Warrant
and of reasonably satisfactory indemnification or the posting of a bond, the Company shall execute and deliver a new Purchase Warrant
of like tenor and date. Any such new Purchase Warrant executed and delivered as a result of such loss, theft, mutilation or destruction
shall constitute a substitute contractual obligation on the part of the Company.


 


6.Adjustments.


 


6.1Adjustments
to Exercise Price and Number of Securities. The Exercise Price and the number of Shares underlying the Purchase Warrant shall
be subject to adjustment from time to time as hereinafter set forth:


 


6.1.1Share Dividends;
Split Ups. If, after the date hereof, and subject to the provisions of Section 6.3 below, the number of outstanding
Shares is increased by a stock dividend payable in Shares or by a split up of Shares or other similar event, then, on the effective
day thereof, the number of Shares purchasable hereunder shall be increased in proportion to such increase in outstanding shares,
and the Exercise Price shall be proportionately decreased.


 


6.1.2 Aggregation
of Shares. If, after the date hereof, and subject to the provisions of Section 6.3 below, the number of outstanding
Shares is decreased by a consolidation, combination or reclassification of Shares or other similar event, then, on the effective
date thereof, the number of Shares purchasable hereunder shall be decreased in proportion to such decrease in outstanding shares,
and the Exercise Price shall be proportionately increased.


 






    	-5-



    	 



    
 


6.1.3 Replacement
of Securities upon Reorganization, etc. In case of any reclassification or reorganization of the outstanding Shares other than
a change covered by Section 6.1.1 or Section 6.1.2 hereof or that solely affects the par value of such Shares, or
in the case of any share reconstruction or amalgamation or consolidation of the Company with or into another corporation (other
than a consolidation or share reconstruction or amalgamation in which the Company is the continuing corporation and that does not
result in any reclassification or reorganization of the outstanding Shares), or in the case of any sale or conveyance to another
corporation or entity of the property of the Company as an entirety or substantially as an entirety in connection with which the
Company is dissolved, the Holder of this Purchase Warrant shall have the right thereafter (until the expiration of the right of
exercise of this Purchase Warrant) to receive upon the exercise hereof, for the same aggregate Exercise Price payable hereunder
immediately prior to such event, the kind and amount of shares of stock or other securities or property (including cash) receivable
upon such reclassification, reorganization, share reconstruction or amalgamation, or consolidation, or upon a dissolution following
any such sale or transfer, by a Holder of the number of Shares of the Company obtainable upon exercise of this Purchase Warrant
immediately prior to such event; and if any reclassification also results in a change in Shares covered by Section 6.1.1
or Section 6.1.2, then such adjustment shall be made pursuant to Section 6.1.1, Section 6.1.2 and this Section
6.1.3. The provisions of this Section 6.1.3 shall similarly apply to successive reclassifications, reorganizations,
share reconstructions or amalgamations, or consolidations, sales or other transfers.


 


6.1.4 Changes
in Form of Purchase Warrant. This form of Purchase Warrant need not be changed because of any change pursuant to this Section
6.1, and Purchase Warrants issued after such change may state the same Exercise Price and the same number of Shares as are
stated in the Purchase Warrants initially issued pursuant to this Agreement. The acceptance by any Holder of the issuance of new
Purchase Warrants reflecting a required or permissive change shall not be deemed to waive any rights to an adjustment occurring
after the Commencement Date or the computation thereof.


 


6.2 Substitute
Purchase Warrant. In case of any consolidation of the Company with, or share reconstruction or amalgamation of the Company
with or into, another corporation (other than a consolidation or share reconstruction or amalgamation which does not result in
any reclassification or change of the outstanding Shares), the corporation formed by such consolidation or share reconstruction
or amalgamation shall execute and deliver to the Holder a supplemental Purchase Warrant providing that the holder of each Purchase
Warrant then outstanding or to be outstanding shall have the right thereafter (until the stated expiration of such Purchase Warrant)
to receive, upon exercise of such Purchase Warrant, the kind and amount of shares of stock and other securities and property receivable
upon such consolidation or share reconstruction or amalgamation, by a holder of the number of Shares of the Company for which such
Purchase Warrant might have been exercised immediately prior to such consolidation, share reconstruction or amalgamation, sale
or transfer. Such supplemental Purchase Warrant shall provide for adjustments which shall be identical to the adjustments provided
for in this Section 6. The above provision of this Section 6 shall similarly apply to successive consolidations or
share reconstructions or amalgamations.


 


6.3 Elimination of Fractional
Interests. The Company shall not be required to issue certificates representing fractions of Shares upon the exercise of the
Purchase Warrant, nor shall it be required to issue scrip or pay cash in lieu of any fractional interests, it being the intent
of the parties that all fractional interests shall be eliminated by rounding any fraction up or down, as the case may be, to the
nearest whole number of Shares or other securities, properties or rights.


 


7. Reservation and Listing.
The Company shall at all times reserve and keep available out of its authorized Shares, solely for the purpose of issuance upon
exercise of the Purchase Warrants, such number of Shares or other securities, properties or rights as shall be issuable upon the
exercise thereof. The Company covenants and agrees that, upon exercise of the Purchase Warrants and payment of the Exercise Price
therefor, in accordance with the terms hereby, all Shares and other securities issuable upon such exercise shall be duly and validly
issued, fully paid and non-assessable and not subject to preemptive rights of any shareholder. The Company further covenants and
agrees that upon exercise of the Purchase Warrants and payment of the exercise price therefor, all Shares and other securities
issuable upon such exercise shall be duly and validly issued, fully paid and non-assessable and not subject to preemptive rights
of any shareholder. As long as the Purchase Warrants shall be outstanding, the Company shall use its commercially reasonable efforts
to cause all Shares issuable upon exercise of the Purchase Warrants to be listed (subject to official notice of issuance) on all
national securities exchanges (or, if applicable, on the OTC Bulletin Board or any successor trading market) on which the Shares
issued to the public in the Offering may then be listed and/or quoted.


 






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8.Certain Notice Requirements.


 


8.1Holder’s
Right to Receive Notice. Nothing herein shall be construed as conferring upon the Holders the right to vote or consent or to
receive notice as a shareholder for the election of directors or any other matter, or as having any rights whatsoever as a shareholder
of the Company. If, however, at any time prior to the expiration of the Purchase Warrants and their exercise, any of the events
described in Section 8.2 shall occur, then, in one or more of said events, the Company shall give written notice of such
event at least fifteen days prior to the date fixed as a record date or the date of closing the transfer books (the “Notice
Date”) for the determination of the shareholders entitled to such dividend, distribution, conversion or exchange of securities
or subscription rights, or entitled to vote on such proposed dissolution, liquidation, winding up or sale. Such notice shall specify
such record date or the date of the closing of the transfer books, as the case may be. Notwithstanding the foregoing, the Company
shall deliver to each Holder a copy of each notice given to the other shareholders of the Company at the same time and in the same
manner that such notice is given to the shareholders.


 


8.2 Events Requiring
Notice. The Company shall be required to give the notice described in this Section 8 upon one or more of the following
events: (i) if the Company shall take a record of the holders of its Shares for the purpose of entitling them to receive a dividend
or distribution payable otherwise than in cash, or a cash dividend or distribution payable otherwise than out of retained earnings,
as indicated by the accounting treatment of such dividend or distribution on the books of the Company, (ii) the Company shall offer
to all the holders of its Shares any additional shares of capital stock of the Company or securities convertible into or exchangeable
for shares of capital stock of the Company, or any option, right or warrant to subscribe therefor, or (iii) a dissolution, liquidation
or winding up of the Company (other than in connection with a consolidation or share reconstruction or amalgamation) or a sale
of all or substantially all of its property, assets and business shall be proposed.


 


8.3 Notice of
Change in Exercise Price. The Company shall, promptly after an event requiring a change in the Exercise Price pursuant to Section
6 hereof, send notice to the Holders of such event and change (“Price Notice”). The Price Notice shall describe
the event causing the change and the method of calculating same and shall be certified as being true and accurate by the Company’s
Chief Financial Officer.


 


8.4 Transmittal
of Notices. All notices, requests, consents and other communications under this Purchase Warrant shall be in writing and shall
be deemed to have been duly made (1) when hand delivered, (2) when mailed by express mail or private courier service or (3) when
the event requiring notice is disclosed in all material respects and filed in a current report on Form 8-K or in a definitive proxy
statement on Schedule 14A prior to the Notice Date: (i) if to the registered Holder of the Purchase Warrant, to the address of
such Holder as shown on the books of the Company, or (ii) if to the Company, to following address or to such other address as the
Company may designate by notice to the Holders:


 


If to the Holder:


 


Aegis Capital Corp.

810 Seventh Avenue, 11th Floor

New York, New York 10019

Attn: Mr. David Bocchi, Managing Director of


Investment Banking


Fax No.: (212) 813-1047


 


With a copy (which shall not
constitute notice) to:


 


Blank Rome LLP


405 Lexington Avenue


New York, NY 10174


Attn: Brad Shiffman, Esq.


Fax: (917) 332-3725


 






    	-7-



    	 



    
 


If to the Company:


 


Neuralstem, Inc.


9700 Great Seneca Highway


Rockville, MD 20850


Attn: I. Richard Garr, CEO


Fax No.: (301) 560-6634


 


With a copy (which shall not constitute notice) to:


 


Silvestre Law Group, P.C.


31200 Via Colinas, Suite 200


Westlake Village, CA 91362


Attn: Raul Silvestre, Esq.


Fax No.: (818) 597-7551


 


9.Miscellaneous.


 


9.1Amendments.
The Company and Aegis may from time to time supplement or amend this Purchase Warrant without the approval of any of the Holders
in order to cure any ambiguity, to correct or supplement any provision contained herein that may be defective or inconsistent with
any other provisions herein, or to make any other provisions in regard to matters or questions arising hereunder that the Company
and Aegis may deem necessary or desirable and that the Company and Aegis deem shall not adversely affect the interest of the Holders.
All other modifications or amendments shall require the written consent of and be signed by the party against whom enforcement
of the modification or amendment is sought.


 


9.2 Headings.
The headings contained herein are for the sole purpose of convenience of reference, and shall not in any way limit or affect the
meaning or interpretation of any of the terms or provisions of this Purchase Warrant.


 


9.3. Entire
Agreement. This Purchase Warrant (together with the other agreements and documents being delivered pursuant to or in connection
with this Purchase Warrant) constitutes the entire agreement of the parties hereto with respect to the subject matter hereof, and
supersedes all prior agreements and understandings of the parties, oral and written, with respect to the subject matter hereof.


 


9.4 Binding
Effect. This Purchase Warrant shall inure solely to the benefit of and shall be binding upon, the Holder and the Company and
their permitted assignees, respective successors, legal representative and assigns, and no other person shall have or be construed
to have any legal or equitable right, remedy or claim under or in respect of or by virtue of this Purchase Warrant or any provisions
herein contained.


 


9.5 Governing
Law; Submission to Jurisdiction. This Purchase Warrant shall be governed by and construed and enforced in accordance with the
laws of the State of Delaware, without giving effect to conflict of laws principles thereof. The Company hereby agrees that any
action, proceeding or claim against it arising out of, or relating in any way to this Purchase Warrant shall be brought and enforced
in the New York Supreme Court, County of New York, or in the United States District Court for the Southern District of New York,
and irrevocably submits to such jurisdiction, which jurisdiction shall be exclusive. The Company hereby waives any objection to
such exclusive jurisdiction and that such courts represent an inconvenient forum. Any process or summons to be served upon the
Company may be served by transmitting a copy thereof by registered or certified mail, return receipt requested, postage prepaid,
addressed to it at the address set forth in Section 8 hereof. Such mailing shall be deemed personal service and shall be
legal and binding upon the Company in any action, proceeding or claim. The Company and the Holder agree that the prevailing party(ies)
in any such action shall be entitled to recover from the other party(ies) all of its reasonable attorneys’ fees and expenses
relating to such action or proceeding and/or incurred in connection with the preparation therefor.


 






    	-8-



    	 



    
 


9.6 Waiver,
etc. The failure of the Company or the Holder to at any time enforce any of the provisions of this Purchase Warrant shall not
be deemed or construed to be a waiver of any such provision, nor to in any way affect the validity of this Purchase Warrant or
any provision hereof or the right of the Company or any Holder to thereafter enforce each and every provision of this Purchase
Warrant. No waiver of any breach, non-compliance or non-fulfillment of any of the provisions of this Purchase Warrant shall be
effective unless set forth in a written instrument executed by the party or parties against whom or which enforcement of such waiver
is sought; and no waiver of any such breach, non-compliance or non-fulfillment shall be construed or deemed to be a waiver of any
other or subsequent breach, non-compliance or non-fulfillment.


 


9.7 Execution
in Counterparts. This Purchase Warrant may be executed in one or more counterparts, and by the different parties hereto in
separate counterparts, each of which shall be deemed to be an original, but all of which taken together shall constitute one and
the same agreement, and shall become effective when one or more counterparts has been signed by each of the parties hereto and
delivered to each of the other parties hereto. Such counterparts may be delivered by facsimile transmission or other electronic
transmission.


 


9.8 Exchange
Agreement. As a condition of the Holder’s receipt and acceptance of this Purchase Warrant, Holder agrees that, at any
time prior to the complete exercise of this Purchase Warrant by Holder, if the Company and Aegis enter into an agreement (“Exchange
Agreement”) pursuant to which they agree that all outstanding Purchase Warrants will be exchanged for securities or cash
or a combination of both, then Holder shall agree to such exchange and become a party to the Exchange Agreement.


 


 


[Remainder of page
intentionally left blank.]


 






    	-9-



    	 



    
 




IN WITNESS WHEREOF,
the Company has caused this Purchase Warrant to be signed by its duly authorized officer as of the ____ day of _______, 2012.


 


 


NEURALSTEM, INC.


 


 


By:_________________________________


Name:


Title:


 






    	-10-



    	 



    
 







Form to be used to
exercise Purchase Warrant:


 


 


 


Date: __________, 20___


 


 


 


The undersigned hereby
elects irrevocably to exercise the Purchase Warrant for ______ Shares of Neuralstem, Inc., a Delaware corporation (the “Company”)
and hereby makes payment of $____ (at the rate of $____ per Share) in payment of the Exercise Price pursuant thereto. Please issue
the Shares as to which this Purchase Warrant is exercised in accordance with the instructions given below and, if applicable, a
new Purchase Warrant representing the number of Shares for which this Purchase Warrant has not been exercised.


 


or


 


The undersigned hereby
elects irrevocably to convert its right to purchase ___ Shares under the Purchase Warrant for ______ Shares, as determined in accordance
with the following formula:


 





	X 	=	
        Y(A-B)

	 	 	A
	Where,	X	= The number of Shares to be issued to
    Holder;
	 	Y	= The number of Shares for which the Purchase Warrant is being
    exercised;
	 	A	= The fair market value of one Share which is equal to $_____;
    and
	 	B	= The Exercise Price which is equal to $______ per share







 


The undersigned agrees
and acknowledges that the calculation set forth above is subject to confirmation by the Company and any disagreement with respect
to the calculation shall be resolved by the Company in its sole discretion.


 


Please issue the Shares
as to which this Purchase Warrant is exercised in accordance with the instructions given below and, if applicable, a new Purchase
Warrant representing the number of Shares for which this Purchase Warrant has not been converted.


 


Signature


 


 


 


Signature Guaranteed


 






    	-11-



    	 



    
 




INSTRUCTIONS FOR REGISTRATION
OF SECURITIES


 


Name:


(Print in Block Letters)


Address:


 


 


 


 


 


 


 


 


NOTICE: The signature
to this form must correspond with the name as written upon the face of the Purchase Warrant without alteration or enlargement or
any change whatsoever, and must be guaranteed by a bank, other than a savings bank, or by a trust company or by a firm having membership
on a registered national securities exchange.




 






    	-12-



    	 



    
 


Form to be used to assign Purchase Warrant:


ASSIGNMENT


 


(To be executed by the registered Holder
to effect a transfer of the within Purchase Warrant):


 


 


 


FOR VALUE RECEIVED, __________________
does hereby sell, assign and transfer unto the right to purchase shares of Neuralstem, Inc., a Delaware corporation (the “Company”),
evidenced by the Purchase Warrant and does hereby authorize the Company to transfer such right on the books of the Company.


 


 


 


Dated: __________, 20__


 


 


 


 


Signature


 


 


 


 


Signature Guaranteed


 


 


 


 


NOTICE: The signature
to this form must correspond with the name as written upon the face of the within Purchase Warrant without alteration or enlargement
or any change whatsoever, and must be guaranteed by a bank, other than a savings bank, or by a trust company or by a firm having
membership on a registered national securities exchange.




 






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