Blueprint





  Exhibit 10.4











 



[FORM OF WARRANT]

 



NEITHER THE ISSUANCE AND SALE OF THE SECURITIES REPRESENTED BY THIS
CERTIFICATE NOR THE SECURITIES INTO WHICH THESE SECURITIES ARE
EXERCISABLE HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933,
AS AMENDED, OR APPLICABLE STATE SECURITIES LAWS. THE SECURITIES MAY
NOT BE OFFERED FOR SALE, SOLD, TRANSFERRED OR ASSIGNED (I) IN THE
ABSENCE OF (A) AN EFFECTIVE REGISTRATION STATEMENT FOR THE
SECURITIES UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR (B) AN
OPINION OF COUNSEL SELECTED BY THE HOLDER, IN A GENERALLY
ACCEPTABLE FORM, THAT REGISTRATION IS NOT REQUIRED UNDER SAID ACT
OR (II) UNLESS SOLD PURSUANT TO RULE 144 OR RULE 144A UNDER SAID
ACT. NOTWITHSTANDING THE FOREGOING, THE SECURITIES MAY BE PLEDGED
IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT OR OTHER LOAN OR
FINANCING ARRANGEMENT SECURED BY THE SECURITIES.

 



GT BIOPHARMA, INC.

 



Warrant To Purchase Common Stock

 



Warrant
No.:                                                                                                                                           






Number
of Shares of Common Stock:_____________


Date of
Issuance: January [___], 2018 ("Issuance Date")

 


GT
Biopharma, Inc., a Delaware corporation (the "Company"), hereby certifies that, for
good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, [BUYER], the registered holder
hereof or its permitted assigns (the "Holder"), is entitled, subject to the
terms set forth below, to purchase from the Company, at the
Exercise Price (as defined below) then in effect, at any time or
times on or after the Issuance Date, but not after 11:59 p.m., New
York time, on the Expiration Date, (as defined below),
______________ (_____________)1 fully paid nonassessable shares of
Common Stock, subject to adjustment as provided herein (the "Warrant Shares"). Except as otherwise
defined herein, capitalized terms in this Warrant to Purchase
Common Stock (including any Warrants to Purchase Common Stock
issued in exchange, transfer or replacement hereof, this
"Warrant"), shall have the
meanings set forth in Section 17. This Warrant is one of the
Warrants to purchase Common Stock (the "SPA Warrants") issued pursuant to
Section 1 of that certain Securities Purchase Agreement, dated as
of January 22, 2018 (the "Subscription Date"), by and among the
Company and the investors (the "Buyers") referred to therein (the
"Securities Purchase
Agreement"). Capitalized terms used herein and not otherwise
defined shall have the definitions ascribed to such terms in the
Securities Purchase Agreement.

 

 





1 Insert 100% of the
number of shares of Common Stock issuable to the Holder on the
Closing Date upon conversion of the Notes (as defined in the
Securities Purchase Agreement) (without regard to any limitation on
conversion set forth therein) purchased by the Holder pursuant to
the Securities Purchase Agreement.




 







 





 

1. EXERCISE
OF WARRANT.

 

(a) Mechanics of Exercise. Subject
to the terms and conditions hereof (including, without limitation,
the limitations set forth in Section 1(f)), this Warrant may be
exercised by the Holder at any time or times on or after the
Issuance Date, in whole or in
part, by (i) delivery of a written notice, in the form
attached hereto as Exhibit
A (the "Exercise
Notice"), of the Holder's election to exercise this Warrant
and (ii) (A) payment to the Company of an amount equal to the
applicable Exercise Price multiplied by the number of Warrant
Shares as to which this Warrant is being exercised (the
"Aggregate Exercise Price")
in cash by wire transfer of immediately available funds or (B) if
the provisions of Section 1(d) are applicable, by notifying the
Company that this Warrant is being exercised pursuant to a Cashless
Exercise (as defined in Section 1(d)). No ink-original Exercise
Notice shall be required, nor shall any medallion guarantee (or
other type of guarantee or notarization) of any Exercise Notice be
required. The Holder shall not be required to deliver the original
Warrant in order to effect an exercise hereunder. Execution and
delivery of the Exercise Notice with respect to less than all of
the Warrant Shares shall have the same effect as cancellation of
the original Warrant and issuance of a new Warrant evidencing the
right to purchase the remaining number of Warrant Shares. On or
before the first (1st) Trading Day
following the date on which the Holder has delivered an Exercise
Notice, the Company shall transmit by facsimile an acknowledgment
of confirmation of receipt of the Exercise Notice to the Holder and
the Company's transfer agent (the "Transfer Agent"). On or before the
earlier of (i) second (2nd) Trading Day and
(ii) the number of Trading Days comprising the Standard Settlement
Period, in each case, following the date on which the Holder has
delivered the Exercise Notice, so long as the Holder delivers the
Aggregate Exercise Price (or notice of a Cashless Exercise) on or
prior to the first (1st) Trading Day
following the date on which the Holder has delivered the Exercise
Notice (a "Share Delivery
Date") (provided that if the Aggregate Exercise Price has
not been delivered by such date, the applicable Share Delivery Date
shall be one (1) Trading Day after the Aggregate Exercise Price (or
notice of a Cashless Exercise) is delivered), the Company shall (X)
provided that the Transfer Agent is participating in The Depository
Trust Company ("DTC") Fast
Automated Securities Transfer Program, credit such aggregate number
of Warrant Shares to which the Holder is entitled pursuant to such
exercise to the Holder's or its designee's balance account with DTC
through its Deposit / Withdrawal At Custodian system, or (Y) if the
Transfer Agent is not participating in the DTC Fast Automated
Securities Transfer Program, issue and dispatch by overnight
courier to the address as specified in the Exercise Notice, a
certificate, registered in the Company's share register in the name
of the Holder or its designee, for the number of Warrant Shares to
which the Holder is entitled pursuant to such exercise. The Company
shall be responsible for all fees and expenses of the Transfer
Agent and all fees and expenses with respect to the issuance of
Warrant Shares via DTC, if any, including without limitation for
same day processing. Upon delivery of the Exercise Notice, the
Holder shall be deemed for all corporate purposes to have become
the holder of record of the Warrant Shares with respect to which
this Warrant has been exercised, irrespective of the date such
Warrant Shares are credited to the Holder's DTC account or the date
of delivery of the 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 the Company shall as soon as practicable and in no
event later than five (5) Trading Days after any exercise and at
its own expense, issue a new Warrant (in accordance with Section
7(d)) representing the right to purchase the number of Warrant
Shares issuable immediately prior to such exercise under this
Warrant, less the number of Warrant Shares with respect to which
this Warrant is exercised. No fractional Warrant Shares are to be
issued upon the exercise of this Warrant, but rather the number of
Warrant Shares to be issued shall be rounded up to the nearest
whole number. The Company shall pay any and all taxes which may be
payable with respect to the issuance and delivery of Warrant Shares
upon exercise of this Warrant. The Company's obligations to issue
and deliver Warrant Shares in accordance with the terms and subject
to the conditions hereof are absolute and unconditional,
irrespective of any action or inaction by the Holder to enforce the
same, any waiver or consent with respect to any provision hereof,
the recovery of any judgment against any Person or any action to
enforce the same, or any setoff, counterclaim, recoupment,
limitation or termination.

 



 

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(b) Exercise Price. For purposes of
this Warrant, "Exercise
Price" means $4.58, 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 prior to the applicable
Share Delivery Date either (I) if the Transfer Agent is not
participating in the DTC Fast Automated Securities Transfer
Program, 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 if the Transfer Agent is
participating in the DTC Fast Automated Securities Transfer
Program, 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 or (II) if the
Registration Statement (as defined in the Registration Rights
Agreement) covering the resale of the Warrant Shares that are the
subject of the Exercise Notice (the "Unavailable Warrant Shares") is not
available for the resale of such Unavailable Warrant Shares and the
Company fails to promptly, but in no event later than as is
required pursuant to the Registration Rights Agreement (x) so
notify the Holder and (y) deliver the Warrant Shares electronically
without any restrictive legend by crediting such aggregate number
of Warrant Shares to which the Holder is entitled pursuant to such
exercise to the Holder's or its designee's balance account with DTC
through its Deposit / Withdrawal At Custodian system (the event
described in the immediately foregoing clause (II) is hereinafter
referred as a "Notice
Failure" and together with the event described in clause (I)
above, an "Exercise
Failure"), then, in addition to all other remedies available
to the Holder, (X) the Company shall pay in cash to the Holder on
each day after the applicable Share Delivery Date and during such
Exercise Failure an amount equal to 1.5% of the product of (A) the
sum of the number of shares of Common Stock not issued to the
Holder on or prior to the Share Delivery Date and to which the
Holder is entitled, and (B) any trading price of the Common Stock
selected by the Holder in writing as in effect at any time during
the period beginning on the applicable Exercise Date and ending on
the applicable Share Delivery Date, and (Y) the Holder, upon
written notice to the Company, may void its Exercise Notice with
respect to, and retain or have returned, as the case may be, any
portion of this Warrant that has not been exercised pursuant to
such Exercise Notice; provided that the voiding of an Exercise
Notice shall not affect the Company's obligations to make any
payments which have accrued prior to the date of such notice
pursuant to this Section 1(c) or otherwise. In addition to the
foregoing, if on or prior to the applicable Share Delivery Date
either (I) if the Transfer Agent is not participating in the DTC
Fast Automated Securities Transfer Program, 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, if the
Transfer Agent is participating in the DTC Fast Automated
Securities Transfer Program, 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 hereunder or pursuant
to the Company's obligation pursuant to clause (ii) below or (II) a
Notice Failure occurs, and if on or after such Trading Day the
Holder purchases (in an open market transaction or otherwise)
shares of Common Stock to deliver in satisfaction of a sale by the
Holder of shares of Common Stock issuable upon such exercise that
the Holder anticipated receiving from the Company (a "Buy-In"), then the Company shall, within
three (3) Trading 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 (the "Buy-In Price"), at which point the
Company's obligation to deliver such certificate (and to issue such
shares of Common Stock) or credit such Holder's balance account
with DTC for such shares of Common Stock shall terminate, or (ii)
promptly honor its obligation to deliver to the Holder a
certificate or certificates representing such shares of Common
Stock or credit such Holder's balance account with DTC, as
applicable, 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, times (B) any trading price of
the Common Stock selected by the Holder in writing as in effect at
any time during the period beginning on the applicable Exercise
Date and ending on the applicable Share Delivery Date. Nothing
shall limit the Holder's right to pursue any other remedies
available to it hereunder, at law or in equity, including, without
limitation, a decree of specific performance and/or injunctive
relief with respect to the Company's failure to timely deliver
certificates representing shares of Common Stock (or to
electronically deliver such shares of Common Stock) upon the
exercise of this Warrant as required pursuant to the terms
hereof.

 



 

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(d) Cashless Exercise.  Notwithstanding anything contained
herein to the contrary, if the Registration Statement covering the
resale of the Unavailable Warrant Shares is not available for the
resale of such Unavailable Warrant Shares, the Holder may, in its
sole discretion, exercise this Warrant in whole or in part and, in
lieu of making the cash payment otherwise contemplated to be made
to the Company upon such exercise in payment of the Aggregate
Exercise Price, elect instead to receive upon such exercise the
"Net Number" of shares of Common Stock determined according to the
following formula (a "Cashless
Exercise"):

 


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


B

 


For
purposes of the foregoing formula:

 


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

 


B= as
applicable: (i) the Weighted Average Price of the Common Stock on
the Trading Day immediately preceding the date of the applicable
Exercise Notice if such Exercise Notice is (1) both executed and
delivered pursuant to Section 1(a) hereof on a day that is not a
Trading Day or (2) both executed and delivered pursuant to Section
1(a) hereof on a Trading Day prior to the opening of "regular
trading hours" (as defined in Rule 600(b)(64) of Regulation NMS
promulgated under the federal securities laws) on such Trading Day,
(ii) at the option of the Holder, either (x) the Weighted Average
Price of the Common Stock on the Trading Day immediately preceding
the date of the applicable Exercise Notice, or (y) the Bid Price of
the Common Stock on the principal trading market as reported by
Bloomberg as of the time of the Holder’s execution of the
applicable Exercise Notice if such Exercise Notice is executed
during "regular trading hours" on a Trading Day and is delivered
within two (2) hours thereafter (including until two (2) hours
after the close of "regular trading hours" on a Trading Day)
thereafter pursuant to Section 1(a) hereof or (iii) the Weighted
Average Price of the Common Stock on the date of the applicable
Exercise Notice if the date of such Exercise Notice is a Trading
Day and such Exercise Notice is both executed and delivered
pursuant to Section 1(a) hereof after the close of "regular trading
hours" on such Trading Day.

 


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

 



 

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For
purposes of Rule 144(d) promulgated under the 1933 Act, as in
effect on the date hereof, the Company hereby acknowledges and
agrees that the Warrant Shares issued in a Cashless Exercise shall
be deemed to have been acquired by the Holder, and the holding
period for the Warrant Shares shall be deemed to have commenced, on
the date this Warrant was originally issued pursuant to the
Securities Purchase Agreement.

 

(e) Disputes. In the case of a
dispute as to the determination of the Exercise Price or the
arithmetic calculation of the Warrant Shares, the Company shall
promptly issue to the Holder the number of Warrant Shares that are
not disputed and resolve such dispute in accordance with Section
12.

 

(f) Beneficial Ownership.
Notwithstanding anything to the
contrary contained herein, the Company shall not effect the
exercise of any portion of this Warrant, and the Holder shall not
have the right to exercise any portion of this Warrant, pursuant to
the terms and conditions of this Warrant and any such exercise
shall be null and void and treated as if never made, to the extent
that after giving effect to such exercise, the Holder together with
the other Attribution Parties collectively would beneficially own
in excess of 4.99% (the "Maximum
Percentage") of the number of
shares of Common Stock outstanding immediately after giving effect
to such exercise. For purposes of the foregoing sentence, the
aggregate number of shares of Common Stock beneficially owned by
the Holder and the other Attribution Parties shall include the
number of shares of Common Stock held by the Holder and all other
Attribution Parties plus the number of shares of Common Stock
issuable upon exercise of this Warrant with respect to which the
determination of such sentence is being made, but shall exclude the
number of shares of Common Stock which would be issuable upon (A)
exercise of the remaining, unexercised portion of this Warrant
beneficially owned by the Holder or any of the other Attribution
Parties and (B) exercise or conversion of the unexercised or
unconverted portion of any other securities of the Company
(including, without limitation, any convertible notes or
convertible preferred stock or warrants, including the other SPA
Warrants) beneficially owned by the Holder or any other Attribution
Party subject to a limitation on conversion or exercise analogous
to the limitation contained in this Section 1(f). For purposes of
this Section 1(f), beneficial ownership shall be calculated in
accordance with Section 13(d) of the Securities Exchange Act of
1934, as amended (the "1934 Act"). For purposes of determining the number of
outstanding shares of Common Stock the Holder may acquire upon the
exercise of this Warrant without exceeding the Maximum Percentage,
the Holder may rely on the number of outstanding shares of Common
Stock as reflected in (x) the Company's most recent Annual Report
on Form 10-K, Quarterly Report on Form 10-Q, Current Report on Form
8-K or other public filing with the Securities and Exchange
Commission (the "SEC"), as
the case may be, (y) a more recent public announcement by the
Company or (3) any other written notice by the Company or the Transfer Agent
setting forth the number of shares of Common Stock
outstanding (the
"Reported
Outstanding Share Number"). If
the Company receives an Exercise Notice from the Holder at a time
when the actual number of outstanding shares of Common Stock is
less than the Reported Outstanding Share Number, the Company shall
(i) notify the Holder in writing of the number of shares of Common
Stock then outstanding and, to the extent that such Exercise Notice
would otherwise cause the Holder's beneficial ownership, as
determined pursuant to this Section 1(f), to exceed the Maximum
Percentage, the Holder must notify the Company of a reduced number
of Warrant Shares to be purchased pursuant to such Exercise
Notice
(the number of shares by which such
purchase is reduced, the "Reduction
Shares") and (ii) as soon as
reasonably practicable, the Company shall return to the Holder any
exercise price paid by the Holder for the Reduction Shares.
For any reason at any time, upon the written or oral request of the
Holder, the Company shall within one
(1) Trading Day confirm orally and in writing or by electronic mail
to the Holder the number of shares of Common Stock then
outstanding. In any case, the number of outstanding shares of
Common Stock shall be determined after giving effect to the
conversion or exercise of securities of the Company, including this
Warrant, by the Holder and any other Attribution Party since the
date as of which the Reported Outstanding Share Number was
reported. In the event that the issuance of shares of Common Stock
to the Holder upon exercise of this Warrant results in the Holder
and the other Attribution Parties being deemed to beneficially own,
in the aggregate, more than the Maximum Percentage of the number of
outstanding shares of Common Stock (as determined under Section
13(d) of the 1934 Act), the number of shares so issued by which the
Holder's and the other Attribution Parties' aggregate beneficial
ownership exceeds the Maximum Percentage (the "Excess
Shares") shall be deemed null
and void and shall be cancelled ab initio, and the Holder shall not
have the power to vote or to transfer the Excess Shares. As soon as
reasonably practicable after the issuance of the Excess Shares has
been deemed null and void, the Company shall return to the Holder
the exercise price paid by the Holder for the Excess Shares.
Upon delivery of a written notice to the Company, the Holder may
from time to time increase or decrease the Maximum Percentage to
any other percentage not in excess of 9.99% as specified in such
notice; provided that (i) any such increase in the Maximum
Percentage will not be effective until the sixty-first
(61st) day
after such notice is delivered to the Company and (ii) any such
increase or decrease will apply only to the Holder and the other
Attribution Parties and not to any other holder of SPA Warrants
that is not an Attribution Party of the Holder. For purposes of
clarity, the shares of Common Stock issuable pursuant to the terms
of this Warrant in excess of the Maximum Percentage shall not be
deemed to be beneficially owned by the Holder for any purpose
including for purposes of Section 13(d) or Rule 16a-1(a)(1) of the
1934 Act. No prior inability to exercise this Warrant pursuant to
this paragraph shall have any effect on the applicability of the
provisions of this paragraph with respect to any subsequent
determination of exercisability. The
provisions of this paragraph shall be construed and implemented in
a manner otherwise than in strict conformity with the terms of this
Section 1(f) to the extent necessary to correct this paragraph or
any portion of this paragraph which may be defective or
inconsistent with the intended beneficial ownership limitation
contained in this Section 1(f) or to make changes or
supplements necessary or desirable to
properly give effect to such limitation. The limitation contained
in this paragraph may not be waived and shall apply to a successor
holder of this Warrant.

 



 

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(g) Insufficient Authorized Shares.
If at any time while this Warrant remains outstanding the Company
does not have a sufficient number of authorized and unreserved
shares of Common Stock to satisfy its obligation to reserve for
issuance upon exercise of this Warrant at least a number of shares
of Common Stock equal to the number of shares of Common Stock as
shall from time to time be necessary to effect the exercise of all
of this Warrant then outstanding (the "Required Reserve Amount" and the failure
to have such sufficient number of authorized and unreserved shares
of Common Stock, an "Authorized
Share Failure"), then the Company shall immediately take all
action necessary to increase the Company's authorized shares of
Common Stock to an amount sufficient to allow the Company to
reserve the Required Reserve Amount for this Warrant then
outstanding. Without limiting the generality of the foregoing
sentence, as soon as practicable after the date of the occurrence
of an Authorized Share Failure, but in no event later than sixty
(60) days after the occurrence of such Authorized Share Failure,
the Company shall hold a meeting of its stockholders for the
approval of an increase in the number of authorized shares of
Common Stock. In connection with such meeting, the Company shall
provide each stockholder with a proxy statement and shall use its
best efforts to solicit its stockholders' approval of such increase
in authorized shares of Common Stock and to cause its board of
directors to recommend to the stockholders that they approve such
proposal. Notwithstanding the foregoing, if any such time of an
Authorized Share Failure, the Company is able to obtain the written
consent of a majority of the shares of its issued and outstanding
Common Stock to approve the increase in the number of authorized
shares of Common Stock, the Company may satisfy this obligation by
obtaining such consent and submitting for filing with the SEC an
Information Statement on Schedule 14C. In the event that upon any
exercise of this Warrant, the Company does not have sufficient
authorized shares to deliver in satisfaction of such exercise, then
unless the Holder elects to void such attempted exercise, the
Holder may require the Company to pay to the Holder within three
(3) Trading Days of the applicable exercise, cash in an amount
equal to the product of (i) the quotient determined by dividing (x)
the number of Warrant Shares that the Company is unable to deliver
pursuant to this Section 1(g), by (y) the total number of Warrant
Shares issuable upon exercise of this Warrant (without regard to
any limitations or restrictions on exercise of this Warrant) and
(ii) the Black Scholes Value; provided, that (x) references to "the
day immediately following the public announcement of the applicable
Change of Control " in the definition of "Black Scholes Value"
shall instead refer to "the date the Holder exercises this Warrant
and the Company cannot deliver the required number of Warrant
Shares because of an Authorized Share Failure" and (y) clause (iii)
of the definition of "Black Scholes Value" shall instead refer to
"the underlying price per share used in such calculation shall be
the highest Weighted Average Price during the period beginning on
the date of the applicable date of exercise and the date that the
Company makes the applicable cash payment."

 



 

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2. ADJUSTMENT OF EXERCISE PRICE AND
NUMBER OF WARRANT SHARES. The Exercise Price and the number
of Warrant Shares shall be adjusted from time to time as
follows:

 

(a) Adjustment Upon Issuance of Shares of
Common Stock. If and whenever on or after the Subscription
Date through the first (1st) day immediately
following the date of consummation of a financing that qualifies as
a Qualified Financing, the Company issues or sells, or in
accordance with this Section 2 is deemed to have issued or sold,
any shares of Common Stock (including the issuance or sale of
shares of Common Stock owned or held by or for the account of the
Company, but excluding shares of Common Stock deemed to have been
issued or sold by the Company in connection with any Excluded
Securities) for a consideration per share (the "New Issuance Price") less than a price
(the "Applicable Price")
equal to the Exercise Price in effect immediately prior to such
issue or sale or deemed issuance or sale (the foregoing a
"Dilutive Issuance"), then
immediately after such Dilutive Issuance, the Exercise Price then
in effect shall be reduced to an amount equal to the New Issuance
Price. For purposes of
determining the adjusted Exercise Price under this Section 2(a),
the following shall be applicable:

 

(i) Issuance of Options. If the
Company in any manner grants or sells any Options and the lowest
price per share for which one share of Common Stock is issuable
upon the exercise of any such Option or upon conversion, exercise
or exchange of any Convertible Securities issuable upon exercise of
any such Option is less than the Applicable Price, then such share
of Common Stock shall be deemed to be outstanding and to have been
issued and sold by the Company at the time of the granting or sale
of such Option for such price per share. For purposes of this
Section 2(a)(i), the "lowest price per share for which one share of
Common Stock is issuable upon the exercise of any such Options or
upon conversion, exercise or exchange of any Convertible Securities
issuable upon exercise of any such Option" shall be equal to the
sum of the lowest amounts of consideration (if any) received or
receivable by the Company with respect to any one share of Common
Stock upon the granting or sale of the Option, upon exercise of the
Option and upon conversion, exercise or exchange of any Convertible
Security issuable upon exercise of such Option less any
consideration paid or payable by the Company with respect to such
one share of Common Stock upon the granting or sale of such Option,
upon exercise of such Option and upon conversion exercise or
exchange of any Convertible Security issuable upon exercise of such
Option. No further adjustment of the Exercise Price shall be made
upon the actual issuance of such shares of Common Stock or of such
Convertible Securities upon the exercise of such Options or upon
the actual issuance of such shares of Common Stock upon conversion,
exercise or exchange of such Convertible Securities.

 



 

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(ii) Issuance
of Convertible Securities. If the Company in any manner
issues or sells any Convertible Securities and the lowest price per
share for which one share of Common Stock is issuable upon the
conversion, exercise or exchange thereof is less than the
Applicable Price, then such share of Common Stock shall be deemed
to be outstanding and to have been issued and sold by the Company
at the time of the issuance or sale of such Convertible Securities
for such price per share. For the purposes of this Section
2(a)(ii), the "lowest price per share for which one share of Common
Stock is issuable upon the conversion, exercise or exchange
thereof" shall be equal to the sum of the lowest amounts of
consideration (if any) received or receivable by the Company with
respect to any one share of Common Stock upon the issuance or sale
of the Convertible Security and upon conversion, exercise or
exchange of such Convertible Security less any consideration paid
or payable by the Company with respect to such one share of Common
Stock upon the issuance or sale of such Convertible Security and
upon conversion, exercise or exchange of such Convertible Security.
No further adjustment of the Exercise Price shall be made upon the
actual issuance of such shares of Common Stock upon conversion,
exercise or exchange of such Convertible Securities, and if any
such issue or sale of such Convertible Securities is made upon
exercise of any Options for which adjustment of this Warrant has
been or is to be made pursuant to other provisions of this Section
2(a), no further adjustment of the Exercise Price shall be made by
reason of such issue or sale.

 

(iii)  Change
in Option Price or Rate of Conversion. If the purchase price
provided for in any Options, the additional consideration, if any,
payable upon the issue, conversion, exercise or exchange of any
Convertible Securities, or the rate at which any Convertible
Securities are convertible into or exercisable or exchangeable for
shares of Common Stock increases or decreases at any time, the
Exercise Price in effect at the time of such increase or decrease
shall be adjusted to the Exercise Price, which would have been in
effect at such time had such Options or Convertible Securities
provided for such increased or decreased purchase price, additional
consideration or increased or decreased conversion rate, as the
case may be, at the time initially granted, issued or sold. For
purposes of this Section 2(a)(iii), if the terms of any Option or
Convertible Security that was outstanding as of the Subscription
Date are increased or decreased in the manner described in the
immediately preceding sentence, then such Option or Convertible
Security and the shares of Common Stock deemed issuable upon
exercise, conversion or exchange thereof shall be deemed to have
been issued as of the date of such increase or decrease. No
adjustment pursuant to this Section 2(a) shall be made if such
adjustment would result in an increase of the Exercise Price then
in effect.

 



 

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(iv)  Calculation
of Consideration Received. In case any Option is issued in
connection with the issue or sale of other securities of the
Company, together comprising one integrated transaction, (x) the
Options will be deemed to have been issued for the Option Value of
such Options and (y) the other securities issued or sold in such
integrated transaction shall be deemed to have been issued or sold
for the difference of (I) the aggregate consideration received by
the Company less any consideration paid or payable by the Company
pursuant to the terms of such other securities of the Company, less
(II) the Option Value of such Options. If any shares of Common
Stock, Options or Convertible Securities are issued or sold or
deemed to have been issued or sold for cash, the consideration
other than cash received therefor will be deemed to be the net
amount received by the Company therefor. If any shares of Common
Stock, Options or Convertible Securities are issued or sold for a
consideration other than cash, the amount of such consideration
received by the Company will be the fair value of such
consideration, except where such consideration consists of publicly
traded securities, in which case the amount of consideration
received by the Company will be the Closing Sale Price of such
publicly traded securities on the date of receipt. If any shares of
Common Stock, Options or Convertible Securities are issued to the
owners of the non-surviving entity in connection with any merger in
which the Company is the surviving entity, the amount of
consideration therefor will be deemed to be the fair value of such
portion of the net assets and business of the non-surviving entity
as is attributable to such shares of Common Stock, Options or
Convertible Securities, as the case may be. The fair value of any
consideration other than cash or publicly traded securities will be
determined jointly by the Company and the Required Holders. If such
parties are unable to reach agreement within ten (10) days after
the occurrence of an event requiring valuation (the "Valuation Event"), the fair value of
such consideration will be determined within five (5) Business Days
after the tenth (10th) day following the
Valuation Event by an independent, reputable appraiser jointly
selected by the Company and the Required Holders. The determination
of such appraiser shall be final and binding upon all parties
absent manifest error and the fees and expenses of such appraiser
shall be borne by the Company. Notwithstanding anything to the
contrary contained herein, if any calculation pursuant to this
Section 2(a)(iv) would result in a dollar value that is lower than
the par value of the Common Stock, then such dollar value shall be
deemed to equal the par value of the Common Stock.

 

(v) Record Date. If the Company
takes a record of the holders of shares of Common Stock for the
purpose of entitling them (A) to receive a dividend or other
distribution payable in shares of Common Stock, Options or in
Convertible Securities or (B) to subscribe for or purchase
shares of Common Stock, Options or Convertible Securities, then
such record date will be deemed to be the date of the issue or sale
of the shares of Common Stock deemed to have been issued or sold
upon the declaration of such dividend or the making of such other
distribution or the date of the granting of such right of
subscription or purchase, as the case may be.

 

(vi)  No
Readjustments. For the avoidance of doubt, in the event the
Exercise Price has been adjusted pursuant to this Section 2(a) and
the Dilutive Issuance that triggered such adjustment does not
occur, is not consummated, is unwound or is cancelled after the
facts for any reason whatsoever, in no event shall the Exercise
Price be readjusted to the Exercise Price that would have been in
effect if such Dilutive Issuance had not occurred or been
consummated.

 



 

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(b) Adjustment Upon Subdivision or
Combination of Shares of Common Stock. If the Company at any
time on or after the Subscription Date subdivides (by any stock
split, stock dividend, recapitalization or otherwise) one or more
classes of its outstanding shares of Common Stock into a greater
number of shares, the Exercise Price in effect immediately prior to
such subdivision will be proportionately reduced and the number of
Warrant Shares will be proportionately increased. If the Company at
any time on or after the Subscription Date combines (by
combination, reverse stock split or otherwise) one or more classes
of its outstanding shares of Common Stock into a smaller number of
shares, the Exercise Price in effect immediately prior to such
combination will be proportionately increased and the number of
Warrant Shares will be proportionately decreased. Any adjustment
under this Section 2(a) shall become effective at the close of
business on the date the subdivision or combination becomes
effective.

 

(c) Voluntary Adjustment By
Company. The Company may at any time during the term of this
Warrant, with the prior written consent of the Required Holders,
reduce the then current Exercise Price to any amount and for any
period of time deemed appropriate by the Board of Directors of the
Company.

 

(d) Other
Events. If any event
occurs of the type contemplated by the provisions of this Section 2
but not expressly provided for by such provisions (including,
without limitation, the granting of stock appreciation rights,
phantom stock rights or other rights with equity features), then
the Company's Board of Directors will make an appropriate
adjustment in the Exercise Price and the number of Warrant Shares,
as mutually determined by the Company’s Board of Directors
and the Required Holders, so as to protect the rights of the
Holder; provided
that no such adjustment
pursuant to this Section 2(d) will increase the Exercise Price or
decrease the number of Warrant Shares as otherwise determined
pursuant to this Section 2.

 

3. RIGHTS UPON DISTRIBUTION OF
ASSETS. If the Company shall declare or make any dividend or
other distribution of its assets (or rights to acquire its assets)
to any or all holders of shares of Common Stock, by way of return
of capital or otherwise (including, without limitation, any
distribution of cash, stock or other securities, property, options,
evidence of indebtedness or any other assets by way of a dividend,
spin off, reclassification, corporate rearrangement, scheme of
arrangement or other similar transaction) (a "Distribution"), at any time after the
issuance of this Warrant, then, in each such case, the Holder shall
be entitled to participate in such Distribution to the same extent
that the Holder would have participated therein if the Holder had
held the number of shares of Common Stock acquirable upon complete
exercise of this Warrant (without regard to any limitations or
restrictions on exercise of this Warrant, including without
limitation, the Maximum Percentage) immediately before the date of
which a record is taken for such Distribution, or, if no such
record is taken, the date as of which the record holders of shares
of Common Stock are to be determined for the participation in such
Distribution (provided, however, that to the extent
that the Holder's right to participate in any such Distribution
would result in the Holder and the other Attribution Parties
exceeding the Maximum Percentage, then the Holder shall not be
entitled to participate in such Distribution to such extent (and
shall not be entitled to beneficial ownership of such shares of
Common Stock as a result of such Distribution (and beneficial
ownership) to such extent) and the portion of such Distribution
shall be held in abeyance for the benefit of the Holder until such
time or times as its right thereto would not result in the Holder
and the other Attribution Parties exceeding the Maximum Percentage,
at which time or times the Holder shall be granted such
Distribution (and any Distributions declared or made on such
initial Distribution or on any subsequent Distribution held
similarly in abeyance) to the same extent as if there had been no
such limitation).

 



 

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4. PURCHASE RIGHTS; FUNDAMENTAL
TRANSACTIONS.

 

(e) Purchase Rights. In addition to
any adjustments pursuant to Section 2 above, if at any time on or
after the Subscription Date and on or prior to the Expiration Date
the Company grants, issues or sells any Options, Convertible
Securities or rights to purchase stock, warrants, securities or
other property pro rata to the record holders of any class of
Common Stock (the "Purchase
Rights"), then the Holder will be entitled to acquire, upon
the terms applicable to such Purchase Rights, the aggregate
Purchase Rights which the Holder could have acquired if the Holder
had held the number of shares of Common Stock acquirable upon
complete exercise of this Warrant (without regard to any
limitations or restrictions on exercise of this Warrant, including
without limitation, the Maximum Percentage) immediately before the
date on which a record is taken for the grant, issuance or sale of
such Purchase Rights, or, if no such record is taken, the date as
of which the record holders of Common Stock are to be determined
for the grant, issuance or sale of such Purchase Rights
(provided,
however, that to
the extent that the Holder's right to participate in any such
Purchase Right would result in the Holder and the other Attribution
Parties exceeding the Maximum Percentage, then the Holder shall not
be entitled to participate in such Purchase Right to such extent
(and shall not be entitled to beneficial ownership of such Common
Stock as a result of such Purchase Right (and beneficial ownership)
to such extent) and such Purchase Right to such extent shall be
held in abeyance for the benefit of the Holder until such time or times as its right thereto
would not result in the Holder and the other Attribution
Parties exceeding the Maximum
Percentage, at which time or times the Holder shall be granted such
right (and any Purchase Right granted, issued or sold on
such initial Purchase Right or on any subsequent Purchase Right to
be held similarly in abeyance) to the
same extent as if there had been no such
limitation).

 

(f) Fundamental
Transaction.    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 in accordance with the provisions of this
Section 4(b), including agreements to deliver to the Holder in
exchange for this Warrant a security of the Successor Entity
evidenced by a written instrument substantially similar in form and
substance to this Warrant, including, without limitation, which is
exercisable for a corresponding number of shares of capital stock
equivalent to the shares of Common Stock acquirable and receivable
upon exercise of this Warrant (without regard to any limitations on
the exercise of this Warrant) prior to such Fundamental
Transaction, and with an exercise price which applies the exercise
price hereunder to such shares of capital stock (but taking into
account the relative value of the shares of Common Stock pursuant
to such Fundamental Transaction and the value of such shares of
capital stock, such adjustments to the number of shares of capital
stock and such exercise price being for the purpose of protecting
the economic value of this Warrant immediately prior to the
consummation of such Fundamental Transaction). Upon the
consummation of each Fundamental Transaction, the Successor Entity
shall succeed to, and be substituted for the Company (so that from
and after the date of the applicable Fundamental Transaction, the
provisions of this Warrant and the other Transaction Documents
referring to the “Company” shall refer instead to the
Successor Entity), and may exercise every right and power of the
Company and shall assume all of the obligations of the Company
under this Warrant with the same effect as if such Successor Entity
had been named as the Company herein. Upon consummation of each
Fundamental Transaction, the Successor Entity shall deliver to the
Holder confirmation that there shall be issued upon exercise of
this Warrant at any time after the consummation of the applicable
Fundamental Transaction, in lieu of the shares of Common Stock (or
other securities, cash, assets or other property (except such items
still issuable under Sections 3 and 4(a) above, which shall
continue to be receivable thereafter)) issuable upon the exercise
of this Warrant prior to the applicable Fundamental Transaction,
such shares of common stock (or its equivalent) of the Successor
Entity (including its Parent Entity) which the Holder would have
been entitled to receive upon the happening of the applicable
Fundamental Transaction had this Warrant been exercised immediately
prior to the applicable Fundamental Transaction (without regard to
any limitations on the exercise of this Warrant), as adjusted in
accordance with the provisions of this Warrant. Notwithstanding the
foregoing, and without limiting Section 1(f) hereof, the Holder may
elect, at its sole option, by delivery of written notice to the
Company to waive this Section 4(b) to permit the Fundamental
Transaction without the assumption of this Warrant. In addition to
and not in substitution for any other rights hereunder, prior to
the consummation of each Fundamental Transaction pursuant to which
holders of shares of Common Stock are entitled to receive
securities or other assets with respect to or in exchange for
shares of Common Stock (a “Corporate Event”), the Company
shall make appropriate provision to insure that the Holder will
thereafter have the right to receive upon an exercise of this
Warrant at any time after the consummation of the applicable
Fundamental Transaction but prior to the Expiration Date, in lieu
of the shares of the Common Stock (or other securities, cash,
assets or other property (except such items still issuable under
Sections 3 and 4(a) above, which shall continue to be receivable
thereafter)) issuable upon the exercise of the Warrant prior to
such Fundamental Transaction, such shares of stock, securities,
cash, assets or any other property whatsoever (including warrants
or other purchase or subscription rights) (collectively, the
“Corporate Event
Consideration”) 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). The provision
made pursuant to the preceding sentence shall be in a form and
substance reasonably satisfactory to the Holder. The provisions of
this Section 4(b) shall apply similarly and equally to successive
Fundamental Transactions and Corporate Events. Notwithstanding the
foregoing, in the event of a Change of Control, at the request of
the Holder delivered before the 30th day after such Change of
Control, the Company (or the Successor Entity) shall purchase this
Warrant from the Holder by paying to the Holder, within five (5)
Business Days after such request (or, if later, on the effective
date of the Change of Control), an amount equal to the Black
Scholes Value of the remaining unexercised portion of this Warrant
on the effective date of such Change of Control, payable in cash;
provided,
however, that, if
the Change of Control is not within the Company's control,
including not approved by the Company's Board of Directors, Holder
shall only be entitled to receive from the Company or any Successor
Entity, as of the date of consummation of such Change of Control,
the same type or form of consideration (and in the same
proportion), at the Black Scholes Value of the unexercised portion
of this Warrant, that is being offered and paid to the holders of
Common Stock of the Company in connection with the Change of
Control, whether that consideration be in the form of cash, stock
or any combination thereof, or whether the holders of Common Stock
are given the choice to receive from among alternative forms of
consideration in connection with the Change of
Control.

 



 

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5. NONCIRCUMVENTION. The Company
hereby covenants and agrees that the Company will not, by amendment
of its Certificate of Incorporation or Bylaws, or through any
reorganization, transfer of assets, consolidation, merger, scheme
of arrangement, dissolution, issue or sale of securities, or any
other voluntary action, avoid or seek to avoid the observance or
performance of any of the terms of this Warrant, and will at all
times in good faith carry out all of the provisions of this Warrant
and take all action as may be required to protect the rights of the
Holder. Without limiting the generality of the foregoing, the
Company (i) shall not increase the par value of any 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 nonassessable
shares of Common Stock upon the exercise of this Warrant, and (iii)
shall, so long as any of the SPA Warrants are outstanding, take all
action necessary to reserve and keep available out of its
authorized and unissued shares of Common Stock, solely for the
purpose of effecting the exercise of the SPA Warrants, the number
of shares of Common Stock as shall from time to time be necessary
to effect the exercise of the SPA Warrants then outstanding
(without regard to any limitations on exercise).

 

6. WARRANT HOLDER NOT DEEMED A
STOCKHOLDER. Except as otherwise specifically provided
herein, the Holder, solely in such Person's capacity as a holder of
this Warrant, shall not be entitled to vote or receive dividends or
be deemed the holder of capital stock of the Company for any
purpose, nor shall anything contained in this Warrant be construed
to confer upon the Holder, solely in such Person's capacity as the
Holder of this Warrant, any of the rights of a 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 such Person is then entitled to
receive upon the due exercise of this Warrant. In addition, nothing
contained in this Warrant shall be construed as imposing any
liabilities on the Holder to purchase any securities (upon exercise
of this Warrant or otherwise) or as a 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.

 

(g) Transfer of Warrant. If this
Warrant is to be transferred, the Holder shall surrender this
Warrant to the Company, whereupon the Company will forthwith issue
and deliver upon the order of the Holder a new Warrant (in
accordance with Section 7(d)), registered as the Holder may
request, representing the right to purchase the number of Warrant
Shares being transferred by the Holder and, if less than the total
number of Warrant Shares then underlying this Warrant is being
transferred, a new Warrant (in accordance with Section 7(d)) to the
Holder representing the right to purchase the number of Warrant
Shares not being transferred.

 

(h) Lost, Stolen or Mutilated
Warrant. Upon receipt by the Company of evidence reasonably
satisfactory to the Company of the loss, theft, destruction or
mutilation of this Warrant, and, in the case of loss, theft or
destruction, of any indemnification undertaking by the Holder to
the Company in customary form and, in the case of mutilation, upon
surrender and cancellation of this Warrant, the Company shall
execute and deliver to the Holder a new Warrant (in accordance with
Section 7(d)) representing the right to purchase the Warrant Shares
then underlying this Warrant.

 



 

-12-







 





 

(i) Exchangeable for Multiple
Warrants. This Warrant is exchangeable, upon the surrender
hereof by the Holder at the principal office of the Company, for a
new Warrant or Warrants (in accordance with Section 7(d))
representing in the aggregate the right to purchase the number of
Warrant Shares then underlying this Warrant, and each such new
Warrant will represent the right to purchase such portion of such
Warrant Shares as is designated by the Holder at the time of such
surrender; provided, however, that no SPA Warrants
for fractional Warrant Shares shall be given.

 

(j) Issuance of New Warrants.
Whenever the Company is required to issue a new Warrant pursuant to
the terms of this Warrant, such new Warrant (i) shall be of like
tenor with this Warrant, (ii) shall represent, as indicated on the
face of such new Warrant, the right to purchase the Warrant Shares
then underlying this Warrant (or in the case of a new Warrant being
issued pursuant to Section 7(a) or Section 7(c), the Warrant Shares
designated by the Holder which, when added to the number of shares
of Common Stock underlying the other new Warrants issued in
connection with such issuance, does not exceed the number of
Warrant Shares then underlying this Warrant), (iii) shall have an
issuance date, as indicated on the face of such new Warrant which
is the same as the Issuance Date, and (iv) shall have the same
rights and conditions as this Warrant.

 

8. NOTICES. Whenever notice is
required to be given under this Warrant, unless otherwise provided
herein, such notice shall be given in accordance with Section 9(f)
of the Securities Purchase Agreement. The Company shall provide the
Holder with prompt written notice of all actions taken pursuant to
this Warrant, including in reasonable detail a description of such
action and the reason therefor. Without limiting the generality of
the foregoing, the Company will give written notice to the Holder
(i) immediately upon any adjustment of the Exercise Price, setting
forth in reasonable detail, and certifying, the calculation of such
adjustment and (ii) at least fifteen (15) days prior to the date on
which the Company closes its books or takes a record (A) with
respect to any dividend or distribution upon the shares of Common
Stock, (B) with respect to any grants, issuances or sales of any
Options, Convertible Securities or rights to purchase stock,
warrants, securities or other property to holders of shares of
Common Stock or (C) for determining rights to vote with respect to
any Fundamental Transaction, Change of Control, dissolution or
liquidation; provided in each case that such
information shall be made known to the public prior to or in
conjunction with such notice being provided to the Holder. It is
expressly understood and agreed that the time of exercise specified
by the Holder in each Exercise Notice shall be definitive and may
not be disputed or challenged by the Company.

 



 

-13-







 





 

9. AMENDMENT AND WAIVER. Any
provision of this Warrant may be changed or amended with the prior
written consent of the Holder and the Company, and any provision of
this Warrant may be waived with the prior written consent of the
Holder. In addition, the affirmative vote of the Required Holders
at a meeting duly called for such purpose or the written consent
without a meeting of the Required Holders shall be required for any
change or amendment or waiver of any provision of all SPA Warrants.
Any change or amendment by the Company and the Required Holders,
and any waiver by the Required Holders, shall be binding on all
holders of SPA Warrants (including the Holder of this Warrant). The
Company hereby covenants and agrees that if, and whenever on or
after the date hereof, the Company amends or modifies any term of
any of the SPA Warrants held by any Person (each document amending
such terms, an "Amendment
Document"), then (i) the Company shall provide notice
thereof to the Holder immediately following the occurrence thereof
and (ii) the terms and conditions of this Warrant shall be, without
any further action by the Holder or the Company, automatically
amended and modified in an economically and legally equivalent
manner such that the Holder shall receive the benefit of such
amended or modified terms and/or conditions (as the case may be)
set forth in such Amendment Document, provided that upon written
notice to the Company at any time the Holder may elect not to
accept the benefit of any such amended or modified term or
condition, in which event the term or condition contained in this
Warrant shall apply to the Holder as it was in effect immediately
prior to such amendment or modification as if such amendment or
modification never occurred with respect to the Holder. The
provisions of the foregoing sentence shall apply similarly and
equally to each Amendment Document.

 

10. GOVERNING LAW; JURISDICTION; JURY
TRIAL. This Warrant shall be governed by and construed and
enforced in accordance with, and all questions concerning the
construction, validity, interpretation and performance of this
Warrant shall be governed by, the internal laws of the State of New
York, without giving effect to any choice of law or conflict of law
provision or rule (whether of the State of New York or any other
jurisdictions) that would cause the application of the laws of any
jurisdictions other than the State of New York. The Company hereby
irrevocably submits to the exclusive jurisdiction of the state and
federal courts sitting in The City of New York, Borough of
Manhattan, for the adjudication of any dispute hereunder or in
connection herewith or with any transaction contemplated hereby or
discussed herein, and hereby irrevocably waives, and agrees not to
assert in any suit, action or proceeding, any claim that it is not
personally subject to the jurisdiction of any such court, that such
suit, action or proceeding is brought in an inconvenient forum or
that the venue of such suit, action or proceeding is improper. The
Company hereby irrevocably waives personal service of process and
consents to process being served in any such suit, action or
proceeding by mailing a copy thereof to such party at the address
set forth in Section 9(f) of the Securities Purchase Agreement and
agrees that such service shall constitute good and sufficient
service of process and notice thereof. Nothing contained herein
shall be deemed to limit in any way any right to serve process in
any manner permitted by law. Nothing contained herein shall be
deemed or operate to preclude the Holder from bringing suit or
taking other legal action against the Company in any other
jurisdiction to collect on the Company's obligations to the Holder,
to realize on any collateral or any other security for such
obligations, or to enforce a judgment or other court ruling in
favor of the Holder. THE COMPANY
HEREBY IRREVOCABLY WAIVES ANY RIGHT IT MAY HAVE, AND AGREES NOT TO
REQUEST, A JURY TRIAL FOR THE ADJUDICATION OF ANY DISPUTE HEREUNDER
OR IN CONNECTION WITH OR ARISING OUT OF THIS WARRANT OR ANY
TRANSACTION CONTEMPLATED HEREBY.

 



 

-14-







 





 

11. CONSTRUCTION; HEADINGS. This
Warrant shall be deemed to be jointly drafted by the Company and
all of the Buyers and shall not be construed against any Person as
the drafter hereof. The headings of this Warrant are for
convenience of reference and shall not form part of, or affect the
interpretation of, this Warrant.

 

12. DISPUTE RESOLUTION. In the case
of a dispute as to the determination of the Exercise Price or the
arithmetic calculation of the Warrant Shares, the Company shall
submit the disputed determinations or arithmetic calculations via
facsimile or electronic mail within one (1) Business Day of receipt
of the Exercise Notice giving rise to such dispute, as the case may
be, to the Holder. If the Holder and the Company are unable to
agree upon such determination or calculation of the Exercise Price
or the Warrant Shares within one (1) Business Day of such disputed
determination or arithmetic calculation being submitted to the
Holder, then the Company shall, within one (1) Business Day submit
via facsimile or electronic mail (a) the disputed determination of
the Exercise Price to an independent, reputable investment bank
selected by the Holder and approved by the Company, such approval
not to be unreasonably withheld, conditioned or delayed or (b) the
disputed arithmetic calculation of the Warrant Shares to an
independent, outside accountant, selected by the Holder and
approved by the Company, such approval not to be unreasonably
withheld, conditioned or delayed. The Company shall cause at its
expense the investment bank or the accountant, as the case may be,
to perform the determinations or calculations and notify the
Company and the Holder of the results no later than five (5)
Business Days from the time it receives the disputed determinations
or calculations. Such investment bank's or accountant's
determination or calculation, as the case may be, shall be binding
upon all parties absent demonstrable error.

 

13. REMEDIES, OTHER OBLIGATIONS, BREACHES
AND INJUNCTIVE RELIEF. The remedies provided in this Warrant
shall be cumulative and in addition to all other remedies available
under this Warrant and the other Transaction Documents, at law or
in equity (including a decree of specific performance and/or other
injunctive relief), and nothing herein shall limit the right of the
Holder to pursue actual damages for any failure by the Company to
comply with the terms of this Warrant. The Company acknowledges
that a breach by it of its obligations hereunder will cause
irreparable harm to the Holder and that the remedy at law for any
such breach may be inadequate. The Company therefore agrees that,
in the event of any such breach or threatened breach, the holder of
this Warrant shall be entitled, in addition to all other available
remedies, to an injunction restraining any breach, without the
necessity of showing economic loss and without any bond or other
security being required.

 

14. TRANSFER. This Warrant and the
Warrant Shares may be offered for sale, sold, transferred, pledged
or assigned without the consent of the Company, except as may
otherwise be required by Section 2(f) of the Securities
Purchase Agreement.

 

15. SEVERABILITY. If any provision
of this Warrant is prohibited by law or otherwise determined to be
invalid or unenforceable by a court of competent jurisdiction, the
provision that would otherwise be prohibited, invalid or
unenforceable shall be deemed amended to apply to the broadest
extent that it would be valid and enforceable, and the invalidity
or unenforceability of such provision shall not affect the validity
of the remaining provisions of this Warrant so long as this Warrant
as so modified continues to express, without material change, the
original intentions of the parties as to the subject matter hereof
and the prohibited nature, invalidity or unenforceability of the
provision(s) in question does not substantially impair the
respective expectations or reciprocal obligations of the parties or
the practical realization of the benefits that would otherwise be
conferred upon the parties. The parties will endeavor in good faith
negotiations to replace the prohibited, invalid or unenforceable
provision(s) with a valid provision(s), the effect of which comes
as close as possible to that of the prohibited, invalid or
unenforceable provision(s).

 



 

-15-







 





 

16. DISCLOSURE. Upon receipt or
delivery by the Company of any notice in accordance with the terms
of this Warrant, unless the Company has in good faith determined
that the matters relating to such notice do not constitute
material, nonpublic information relating to the Company or its
Subsidiaries, the Company shall within one (1) Business Day after
any such receipt or delivery publicly disclose such material,
nonpublic information on a Current Report on Form 8-K or otherwise.
In the event that the Company believes that a notice contains
material, nonpublic information relating to the Company or its
Subsidiaries, the Company so shall indicate to such Holder
contemporaneously with delivery of such notice, and in the absence
of any such indication, the Holder shall be allowed to presume that
all matters relating to such notice do not constitute material,
nonpublic information relating to the Company or its
Subsidiaries.

 

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

 

(k) "1933 Act" means the Securities Act of
1933, as amended.

 

(l) "Affiliate" means, with respect to any
Person, any other Person that directly or indirectly controls, is
controlled by, or is under common control with, such Person, it
being understood for purposes of this definition that "control" of
a Person means the power directly or indirectly either to vote 10%
or more of the stock having ordinary voting power for the election
of directors of such Person or direct or cause the direction of the
management and policies of such Person whether by contract or
otherwise.

 

(m) "Approved Stock Plan" means any employee
benefit plan which has been approved by the Board of Directors of
the Company, pursuant to which the Company's securities may be
issued to any employee, officer or director for services provided
to the Company.

 

(n) "Attribution Parties" means,
collectively, the following Persons and entities: (i) any
investment vehicle, including, any funds, feeder funds or managed
accounts, currently, or from time to time after the Issuance Date,
directly or indirectly managed or advised by the Holder's
investment manager or any of its Affiliates or principals, (ii) any
direct or indirect Affiliates of the Holder or any of the
foregoing, (iii) any Person acting or who could be deemed to be
acting as a Group together with the Holder or any of the foregoing
and (iv) any other Persons whose beneficial ownership of the
Company's Common Stock would or could be aggregated with the
Holder's and the other Attribution Parties for purposes of Section
13(d) of the 1934 Act. For clarity, the purpose of the foregoing is
to subject collectively the Holder and all other Attribution
Parties to the Maximum Percentage.

 



 

-16-







 





 

(o) "Bid Price" means, for any date, the
price determined by the first of the following clauses that
applies: (a) if the Common Stock is then listed or quoted on an
Eligible Market, the bid price of the Common Stock for the time in
question (or the nearest preceding date) on the Eligible Market on
which the Common Stock is then listed or quoted as reported by
Bloomberg L.P. (based on a Trading Day from 9:30 a.m. (New York
City time) to 4:02 p.m. (New York City time)), (b) if the Common
Stock is not then listed or quoted for trading on OTCQB or OTCQX
and if prices for the Common Stock are then reported in the
“Pink Sheets” published by OTC Markets Group, Inc. (or
a similar organization or agency succeeding to its functions of
reporting prices), the most recent bid price per share of the
Common Stock so reported, or (c) in all other cases, the fair
market value of a share of Common Stock as determined by an
independent appraiser selected in good faith by the Purchasers of a
majority in interest of the Securities then outstanding and
reasonably acceptable to the Company, the fees and expenses of
which shall be paid by the Company.

 

(p) "Black Scholes Value" means the value of
this Warrant based on the Black-Scholes Option Pricing Model
obtained from the "OV" function on Bloomberg determined as of the
day immediately following the public announcement of the applicable
Change of Control, or, if the Change of Control is not publicly
announced, the date the Change of Control is consummated, for
pricing purposes and reflecting (i) a risk-free interest rate
corresponding to the U.S. Treasury rate for a period equal to the
remaining term of this Warrant as of such date of request, (ii) an
expected volatility equal to the greater of 100% and the 100 day
volatility obtained from the HVT function on Bloomberg as of the
day immediately following the public announcement of the applicable
Change of Control, or, if the Change of Control is not publicly
announced, the date the Change of Control is consummated, (iii) the
underlying price per share used in such calculation shall be the
greater of (x) the highest Weighted Average Price during the five
(5) Trading Days prior to the day the applicable Change of Control
is publicly announced, or, if the Change of Control is not publicly
announced, such five (5) Trading Day period immediately preceding
the date the Change of Control is consummated and (y) the sum of
the price per share being offered in cash, if any, plus the value
of any non-cash consideration, if any, being offered in the Change
of Control, (iv) a zero cost of borrow and (v) a 360 day
annualization factor.

 

(q) "Bloomberg" means Bloomberg Financial
Markets.

 

(r) "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.

 

(s) "Change of Control" means any Fundamental
Transaction other than (i) any reorganization, recapitalization or
reclassification of the Common Stock in which holders of the
Company’s voting power immediately prior to such
reorganization, recapitalization or reclassification continue after
such reorganization, recapitalization or reclassification to hold
publicly traded securities and, directly or indirectly, are, in all
material respect, the holders of the voting power of the surviving
entity (or entities with the authority or voting power to elect the
members of the board of directors (or their equivalent if other
than a corporation) of such entity or entities) after such
reorganization, recapitalization or reclassification, (ii) pursuant
to a migratory merger effected solely for the purpose of changing
the jurisdiction of incorporation of the Company or (iii) a merger
in connection with a bona fide acquisition by the Company of any
Person in which (x) the gross consideration paid, directly or
indirectly, by the Company in such acquisition is not greater than
20% of the Company’s market capitalization as calculated on
the date of the consummation of such merger and (y) such merger
does not contemplate a change to the identity of a majority of the
board of directors of the Company. Notwithstanding anything herein
to the contrary, any transaction or series of transaction that,
directly or indirectly, results in the Company or the Successor
Entity not having Common Stock or common stock, as applicable,
registered under the 1934 Act and listed on an Eligible Market
shall be deemed a Change of Control.

 



 

-17-







 





 

(t) "Closing Bid Price" and "Closing Sale Price" means, for any
security as of any date, the last closing bid price and last
closing trade price, respectively, for such security on the
Principal Market, as reported by Bloomberg, or, if the Principal
Market begins to operate on an extended hours basis and does not
designate the closing bid price or the closing trade price, as the
case may be, then the last bid price or the last trade price,
respectively, of such security prior to 4:00:00 p.m., New York
time, as reported by Bloomberg, or, if the Principal Market is not
the principal securities exchange or trading market for such
security, the last closing bid price or last trade price,
respectively, of such security on the principal securities exchange
or trading market where such security is listed or traded as
reported by Bloomberg, or if the foregoing do not apply, the last
closing bid price or last trade price, respectively, of such
security in the over-the-counter market on the electronic bulletin
board for such security as reported by Bloomberg, or, if no closing
bid price or last trade price, respectively, is reported for such
security by Bloomberg, the average of the bid prices, or the ask
prices, respectively, of any market makers for such security as
reported in the OTC Link or "pink sheets" by OTC Markets Group Inc.
(formerly Pink OTC Markets Inc.). If the Closing Bid Price or the
Closing Sale Price cannot be calculated for a security on a
particular date on any of the foregoing bases, the Closing Bid
Price or the Closing Sale Price, as the case may be, of such
security on such date shall be the fair market value as mutually
determined by the Company and the Holder. If the Company and the
Holder are unable to agree upon the fair market value of such
security, then such dispute shall be resolved pursuant to Section
12. All such determinations to be appropriately adjusted for any
stock dividend, stock split, stock combination, reclassification or
other similar transaction during the applicable calculation
period.

 

(u) "Common Stock" means (i) the
Company's shares of Common Stock, par value $0.001 per share, and
(ii) any capital stock into which such Common Stock shall have
been changed or any capital stock resulting from a reclassification
of such Common Stock.

 

(v) "Convertible Securities" means any stock
or securities (other than Options) directly or indirectly
convertible into or exercisable or exchangeable for shares of
Common Stock.

 

(w) "Eligible Market" means the Principal
Market, the NYSE American, the Nasdaq Global Market, the Nasdaq
Global Select Market, the Nasdaq Capital Market, the OTC QX or The
New York Stock Exchange, Inc.

 



 

-18-







 





 

(x) "Excluded Securities" means any Common
Stock issued or issuable: (i) in connection with any Approved Stock
Plan, (ii) upon exercise of the SPA Warrants or the SPA Securities;
provided, that the
terms of such SPA Warrants or Other SPA Securities are not amended,
modified or changed on or after the Subscription Date or (iii) upon
exercise of any Options or Convertible Securities which are
outstanding on the day immediately preceding the Subscription Date;
provided, that the
terms of such Options or Convertible Securities are not amended,
modified or changed on or after the Subscription Date.

 

(y) "Expiration Date" means the date sixty
(60) months after 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 day
that is not a Holiday.

 

(z) "Fundamental Transaction" means (A) that
the Company shall, directly or indirectly, including through
Subsidiaries, Affiliates or otherwise, in one or more related
transactions, (i) consolidate or merge with or into (whether or not
the Company is the surviving corporation) another Subject Entity,
or (ii) sell, assign, transfer, convey or otherwise dispose of all
or substantially all of the properties or assets of the Company or
any of its "significant subsidiaries" (as defined in Rule 1-02 of
Regulation S-X) to one or more Subject Entities, or (iii) make, or
allow one or more Subject Entities to make, or allow the Company to
be subject to or have its Common Stock be subject to or party to
one or more Subject Entities making, a purchase, tender or exchange
offer that is accepted by the holders of at least either (x) 50% of
the outstanding shares of Common Stock, (y) 50% of the outstanding
shares of Common Stock calculated as if any shares of Common Stock
held by all Subject Entities making or party to, or Affiliated with
any Subject Entities making or party to, such purchase, tender or
exchange offer were not outstanding; or (z) such number of shares
of Common Stock such that all Subject Entities making or party to,
or Affiliated with any Subject Entity making or party to, such
purchase, tender or exchange offer, become collectively the
beneficial owners (as defined in Rule 13d-3 under the 1934 Act) of
at least 50% of the outstanding shares of Common Stock, or (iv)
consummate a stock purchase agreement or other business combination
(including, without limitation, a reorganization, recapitalization,
spin-off or scheme of arrangement) with one or more Subject
Entities whereby such Subject Entities, individually or in the
aggregate, acquire, either (x) at least 50% of the outstanding
shares of Common Stock, (y) at least 50% of the outstanding shares
of Common Stock calculated as if any shares of Common Stock held by
all the Subject Entities making or party to, or Affiliated with any
Subject Entity making or party to, such stock purchase agreement or
other business combination were not outstanding; or (z) such number
of shares of Common Stock such that the Subject Entities become
collectively the beneficial owners (as defined in Rule 13d-3 under
the 1934 Act) of at least 50% of the outstanding shares of Common
Stock, or (v) reorganize, recapitalize or reclassify its Common
Stock, (B) that the Company shall, directly or indirectly,
including through Subsidiaries, Affiliates or otherwise, in one or
more related transactions, allow any Subject Entity individually or
the Subject Entities in the aggregate to be or become the
"beneficial owner" (as defined in Rule 13d-3 under the 1934 Act),
directly or indirectly, whether through acquisition, purchase,
assignment, conveyance, tender, tender offer, exchange, reduction
in outstanding shares of Common Stock, merger, consolidation,
business combination, reorganization, recapitalization, spin-off,
scheme of arrangement, reorganization, recapitalization or
reclassification or otherwise in any manner whatsoever, of either
(x) at least 50% of the aggregate ordinary voting power represented
by issued and outstanding Common Stock, (y) at least 50% of the
aggregate ordinary voting power represented by issued and
outstanding Common Stock not held by all such Subject Entities as
of the Subscription Date calculated as if any shares of Common
Stock held by all such Subject Entities were not outstanding, or
(z) a percentage of the aggregate ordinary voting power represented
by issued and outstanding shares of Common Stock or other equity
securities of the Company sufficient to allow such Subject Entities
to effect a statutory short form merger or other transaction
requiring other stockholders of the Company to surrender their
shares of Common Stock without approval of the stockholders of the
Company or (C) directly or indirectly, including through
Subsidiaries, Affiliates or otherwise, in one or more related
transactions, the issuance of or the entering into any other
instrument or transaction structured in a manner to circumvent, or
that circumvents, the intent of this definition in which case this
definition shall be construed and implemented in a manner otherwise
than in strict conformity with the terms of this definition to the
extent necessary to correct this definition or any portion of this
definition which may be defective or inconsistent with the intended
treatment of such instrument or transaction.

 



 

-19-







 





 

(aa) "Group"
means a "group" as that term is used in Section 13(d) of the 1934
Act and as defined in Rule 13d-5 thereunder.

 

(bb) "Option
Value" means the
value of an Option based on the Black and Scholes Option Pricing
model obtained from the "OV" function on Bloomberg determined as of
(A) the Trading Day prior to the public announcement of the
issuance of the applicable Option, if the issuance of such Option
is publicly announced or (B) the Trading Day immediately following
the issuance of the applicable Option if the issuance of such
Option is not publicly announced, for pricing purposes and
reflecting (i) a risk-free interest rate corresponding to the U.S.
Treasury rate for a period equal to the remaining term of the
applicable Option as of the applicable date of determination, (ii)
an expected volatility equal to the greater of 100% and the 100 day
volatility obtained from the HVT function on Bloomberg as of (A)
the Trading Day immediately following the public announcement of
the applicable Option if the issuance of such Option is publicly
announced or (B) the Trading Day immediately following the issuance
of the applicable Option if the issuance of such Option is not
publicly announced, (iii) the underlying price per share used in
such calculation shall be the highest Weighted Average Price of the
Common Stock during the period beginning on the Trading Day prior
to the execution of definitive documentation relating to the
issuance of the applicable Option and ending on (A) the Trading Day
immediately following the public announcement of such issuance, if
the issuance of such Option is publicly announced or (B) the
Trading Day immediately following the issuance of the applicable
Option if the issuance of such Option is not publicly announced,
(iv) a zero cost of borrow and (v) a 360 day annualization
factor.

 

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

 

(dd) "Parent
Entity" of a Person means an entity that, directly or
indirectly, controls the applicable Person, including such entity
whose common capital or equivalent equity security is quoted or
listed on an Eligible Market (or, if so elected by the Required
Holders, any other market, exchange or quotation system), or, if
there is more than one such Person or such entity, the Person or
such entity designated by the Required Holders or in the absence of
such designation, such Person or entity with the largest public
market capitalization as of the date of consummation of the
Fundamental Transaction or Change of Control, as
applicable.

 



 

-20-







 





 

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

 

(ff) "Principal
Market" means the OTC QB.

 

(gg) "Qualified
Financing" means the Company raises gross proceeds of at
least $20,000,000 in one or more Subsequent Placement(s) occurring
after the earlier of (x) the time of the registration of all of the
Registrable Securities pursuant to and in accordance with the
Registration Rights Agreement, so long as at such time the Company shall have
no knowledge of any fact that would cause the Registration
Statements required pursuant to the Registration Rights Agreement
not to be effective and available for the resale of all remaining
Registrable Securities in accordance with the terms of the
Registration Rights Agreement and (y) all the Registrable
Securities shall be eligible for resale without restriction or
limitation pursuant to Rule 144 (assuming for purposes of Warrant
Shares that are Registrable Securities, that the applicable
Warrants were exercised by way of a Cashless Exercise) and all
applicable state securities laws so long as at such time the
Company shall have no knowledge of any fact that would cause the
Registrable Securities not to be eligible for sale without
restriction or limitation pursuant to Rule 144 or any applicable
state securities laws;

 

(hh) "Required
Holders" means the holders of the SPA Warrants representing
at least a majority of the shares of Common Stock underlying the
SPA Warrants then outstanding and shall include (i) Empery Asset
Management, LP so long as Empery Asset Management, LP or any of its
Affiliates holds any SPA Warrants and (ii) Ayrton Capital LLC so
long as Ayrton Capital LLC or any of its Affiliates holds any SPA
Warrants.

 

(ii) "SPA
Securities" means the Note issued pursuant to the Securities
Purchase Agreement.

 

(jj) "Standard
Settlement Period" means the standard settlement period,
expressed in a number of Trading Days, on the Company's primary
trading market with respect to the Common Stock as in effect on the
date of delivery of the applicable Exercise Notice.

 

(kk) "Subject
Entity" means any Person, Persons or Group or any Affiliate
or associate of any such Person, Persons or Group.

 

(ll) "Subsequent
Placement" means any direct or indirect, offer, sale, grant
any option to purchase, or other disposition of any of its or its
Subsidiaries' equity or equity equivalent securities, including
without limitation any debt, preferred stock or other instrument or
security whether or not such security is, at any time during its
life and under any circumstances, convertible into or exchangeable
or exercisable for Common Stock or Common Stock
Equivalents.

 



 

-21-







 





 

(mm) "Subsidiary"
has the meaning ascribed to such term in the Securities Purchase
Agreement.

 

(nn) "Successor
Entity" means one or more Person or Persons (or, if so
elected by the Required Holders, the Company or Parent Entity)
formed by, resulting from or surviving any Fundamental Transaction
or Change of Control, as applicable, or one or more Person or
Persons (or, if so elected by the Required Holders, the Company or
the Parent Entity) with which such Fundamental Transaction or
Change of Control shall have been entered into.

 

(oo) "Trading
Day" means any day on which the Common Stock is traded on
the Principal Market, or, if the Principal Market is not the
principal trading market for the Common Stock on such day, then on
the principal securities exchange or securities market on which the
Common Stock is then traded.

 

(pp) "Weighted
Average Price" means, for any security as of any date, the
dollar volume-weighted average price for such security on the
Principal Market during the period beginning at 9:30:01 a.m., New
York time (or such other time as the Principal Market publicly
announces is the official open of trading), and ending at 4:00:00
p.m., New York time (or such other time as the Principal Market
publicly announces is the official close of trading), as reported
by Bloomberg through its "Volume at Price" function or, if the
foregoing does not apply, the dollar volume-weighted average price
of such security in the over-the-counter market on the electronic
bulletin board for such security during the period beginning at
9:30:01 a.m., New York time (or such other time as such market
publicly announces is the official open of trading), and ending at
4:00:00 p.m., New York time (or such other time as such market
publicly announces is the official close of trading), as reported
by Bloomberg, or, if no dollar volume-weighted average price is
reported for such security by Bloomberg for such hours, the average
of the highest Closing Bid Price and the lowest closing ask price
of any of the market makers for such security as reported in the
OTC Link or "pink sheets" by OTC Markets Group Inc. (formerly Pink
OTC Markets Inc.). If the Weighted Average Price cannot be
calculated for a security on a particular date on any of the
foregoing bases, the Weighted Average Price of such security on
such date shall be the fair market value as mutually determined by
the Company and the Holder. If the Company and the Holder are
unable to agree upon the fair market value of such security, then
such dispute shall be resolved pursuant to Section 12 with the term
"Weighted Average Price" being substituted for the term "Exercise
Price." All such determinations shall be appropriately adjusted for
any stock dividend, stock split, stock combination,
reclassification or other similar transaction during the applicable
calculation period.

 



[Signature Page Follows]




 




 

-22-








 






 


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.


 


 



GT
BIOPHARMA, INC.






 


 


By:___________________________


Name:


Title:


 


 


 


 




 

-23-








 










 



  EXHIBIT A


 



EXERCISE NOTICE



TO BE EXECUTED BY THE REGISTERED HOLDER TO EXERCISE
THIS



WARRANT TO PURCHASE COMMON STOCK


 



GT BIOPHARMA, INC.


The
undersigned holder hereby exercises the right to purchase
_________________ of the shares of Common Stock ("Warrant Shares") of GT Biopharma, Inc.,
a Delaware corporation (the "Company"), evidenced by the attached
Warrant to Purchase Common Stock (the "Warrant"). Capitalized terms used herein
and not otherwise defined shall have the respective meanings set
forth in the Warrant.


 


1. Form
of Exercise Price. The Holder intends that payment of the Exercise
Price shall be made as:


 



____________ 

a "Cash Exercise" with respect to
_________________ Warrant Shares; and/or






 



____________ 

a "Cashless Exercise" with
respect to _______________ Warrant Shares.






 


2.
Payment of Exercise Price. In the event that the holder has elected
a Cash Exercise with respect to some or all of the Warrant Shares
to be issued pursuant hereto, the holder shall pay the Aggregate
Exercise Price in the sum of $___________________ to the Company in
accordance with the terms of the Warrant.


 


3.
Delivery of Warrant Shares. The Company shall deliver to the holder
__________ Warrant Shares in accordance with the terms of the
Warrant.


 


Date:
_______________ __, ______


 


 


 


   Name
of Registered Holder


 


 



By:           






Name:


Title:


 


 




 

-24-








 










 



ACKNOWLEDGMENT


 


 


The
Company hereby acknowledges this Exercise Notice and hereby directs
ComputerShare Trust Company, N.A. to issue the above indicated
number of shares of Common Stock in accordance with the Transfer
Agent Instructions dated January __, 2018 from the Company and
acknowledged and agreed to by ComputerShare Trust Company,
N.A.


 



GT
BIOPHARMA, INC.






 


 


 


By:________________________________


Name:


Title:


 


 


 


 


 


 


 


 


 




 

-25-