THE SECURITIES REPRESENTED HEREBY MAY NOT BE
TRANSFERRED UNLESS (I) SUCH SECURITIES HAVE BEEN REGISTERED FOR SALE PURSUANT TO THE SECURITIES ACT OF 1933, AS AMENDED, (II) SUCH
SECURITIES MAY BE SOLD PURSUANT TO RULE 144, OR (III) THE COMPANY HAS RECEIVED AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO
IT THAT SUCH TRANSFER MAY LAWFULLY BE MADE WITHOUT REGISTRATION UNDER THE SECURITIES ACT OF 1933 OR QUALIFICATION UNDER APPLICABLE
STATE SECURITIES LAWS.


 


THIS WARRANT SHALL BE VOID AFTER 5:00 P.M.
EASTERN TIME ON FEBRUARY 2, 2015 (the “EXPIRATION DATE”).


 


NET ELEMENT, INC.


 


WARRANT TO PURCHASE 666,667 SHARES OF


COMMON STOCK, $.001 PAR VALUE PER SHARE


 


For VALUE RECEIVED, Felix
Vulis (“Warrantholder”), is entitled to purchase, subject to the provisions of this Warrant, from Net Element, Inc.,
a Delaware corporation (the “Company”), at any time not later than 5:00 P.M., Eastern Time, on the Expiration Date
(as defined above), at an exercise price per share equal to $0.25 (the exercise price in effect being herein called the “Warrant
Price”), 666,667 shares (“Warrant Shares”) of the Company’s Common Stock, $.001 par value per share (“Common
Stock”). The number of Warrant Shares purchasable upon exercise of this Warrant and the Warrant Price shall be subject to
adjustment from time to time as described herein.


 


Section 1.          Registration.
The Company shall maintain books for the transfer and registration of the Warrant. Upon the initial issuance of this Warrant, the
Company shall issue and register the Warrant in the name of the Warrantholder.


 


Section 2.          Transfers.
As provided herein, this Warrant may be transferred only pursuant to a registration statement filed under the Securities Act of
1933, as amended (the “Securities Act”), or an exemption from such registration. Subject to such restrictions, the
Company shall transfer this Warrant from time to time upon the books to be maintained by the Company for that purpose, upon surrender
thereof for transfer properly endorsed or accompanied by appropriate instructions for transfer and such other documents as may
be reasonably required by the Company, including, if required by the Company, an opinion of its counsel to the effect that such
transfer is exempt from the registration requirements of the Securities Act, to establish that such transfer is being made in accordance
with the terms hereof, and a new Warrant shall be issued to the transferee and the surrendered Warrant shall be canceled by the
Company.


 



    	 



    	 



    

 


Section 3.          Exercise
of Warrant. Subject to the provisions hereof, the Warrantholder may exercise this Warrant in whole or in part at any time prior
to its expiration upon surrender of the Warrant, together with delivery of the duly executed Warrant exercise form attached hereto
as Appendix A (the “Exercise Agreement”) and payment by cash, certified check or wire transfer of funds for the aggregate
Warrant Price for that number of Warrant Shares then being purchased, to the Company during normal business hours on any business
day at the Company’s principal executive offices (or such other office or agency of the Company as it may designate by notice
to the Warrantholder). The Warrant Shares so purchased shall be deemed to be issued to the Warrantholder or the Warrantholder’s
designee, as the record owner of such shares, as of the close of business on the date on which this Warrant shall have been surrendered
(or evidence of loss, theft or destruction thereof and security or indemnity satisfactory to the Company), the Warrant Price shall
have been paid and the completed Exercise Agreement shall have been delivered. Certificates for the Warrant Shares so purchased,
representing the aggregate number of shares specified in the Exercise Agreement, shall be delivered to the Warrantholder within
a reasonable time, not exceeding five (5) business days, after this Warrant shall have been so exercised. The certificates so delivered
shall be in such denominations as may be requested by the Warrantholder and shall be registered in the name of the Warrantholder
or such other name as shall be designated by the Warrantholder. If this Warrant shall have been exercised only in part, then, unless
this Warrant has expired, the Company shall, at its expense, at the time of delivery of such certificates, deliver to the Warrantholder
a new Warrant representing the number of shares with respect to which this Warrant shall not then have been exercised. As used
herein, “business day” means a day, other than a Saturday or Sunday, on which banks in Miami, Florida are open for
the general transaction of business. Each exercise hereof shall constitute the re-affirmation by the Warrantholder that the representations
and warranties contained in Section 4 of the Subscription Agreement (the “Subscription Agreement”) dated December __,
2011 between the Company and the Warrantholder are true and correct in all material respects with respect to the Warrantholder
as of the time of such exercise.


 


Section 4.          Compliance
with the Securities Act of 1933. Except as provided in the Subscription Agreement, the Company may cause the legend set forth
on the first page of this Warrant to be set forth on each Warrant or similar legend on any security issued or issuable upon exercise
of this Warrant, unless counsel for the Company is of the opinion as to any such security that such legend is unnecessary.


 


Section 5.          Payment
of Taxes. The Company will pay any documentary stamp taxes attributable to the initial issuance of Warrant Shares issuable
upon the exercise of the Warrant; provided, however, that the Company shall not be required to pay any tax or taxes which may be
payable in respect of any transfer involved in the issuance or delivery of any certificates for Warrant Shares in a name other
than that of the Warrantholder in respect of which such shares are issued, and in such case, the Company shall not be required
to issue or deliver any certificate for Warrant Shares or any Warrant until the person requesting the same has paid to the Company
the amount of such tax or has established to the Company’s reasonable satisfaction that such tax has been paid. The Warrantholder
shall be responsible for income taxes due under federal, state or other law, if any such tax is due.


 


 


Section 6.          Mutilated
or Missing Warrants. In case this Warrant shall be mutilated, lost, stolen, or destroyed, the Company shall issue in exchange
and substitution of and upon cancellation of the mutilated Warrant, or in lieu of and substitution for the Warrant lost, stolen
or destroyed, a new Warrant of like tenor and for the purchase of a like number of Warrant Shares, but only upon receipt of evidence
reasonably satisfactory to the Company of such loss, theft or destruction of the Warrant, and with respect to a lost, stolen or
destroyed Warrant, reasonable indemnity or bond with respect thereto, if requested by the Company.


 



    	- 2 -



    	 



    

 


Section 7.          Reservation
of Common Stock. The Company hereby represents and warrants that there have been reserved, and the Company shall at all applicable
times keep reserved until issued (if necessary) as contemplated by this Section 7, out of the authorized and unissued shares of
Common Stock, sufficient shares to provide for the exercise of the rights of purchase represented by this Warrant. The Company
agrees that all Warrant Shares issued upon due exercise of the Warrant shall be, at the time of delivery of the certificates for
such Warrant Shares, duly authorized, validly issued, fully paid and non-assessable shares of Common Stock of the Company.


 


Section 8.          Adjustments.
Subject and pursuant to the provisions of this Section 8, unless waived in a particular case by the Warrantholder, the Warrant
Price and number of Warrant Shares subject to this Warrant shall be subject to adjustment from time to time as set forth hereinafter.


 


(a)          If
the Company shall, at any time or from time to time while this Warrant is outstanding, pay a dividend or make a distribution on
its Common Stock in shares of Common Stock, subdivide its outstanding shares of Common Stock into a greater number of shares or
combine its outstanding shares of Common Stock into a smaller number of shares or issue by reclassification of its outstanding
shares of Common Stock any shares of its capital stock (including any such reclassification in connection with a consolidation
or merger in which the Company is the continuing corporation), then the number of Warrant Shares purchasable upon exercise of the
Warrant and the Warrant Price in effect immediately prior to the date upon which such change shall become effective, shall be adjusted
by the Company so that the Warrantholder thereafter exercising the Warrant shall be entitled to receive the number of shares of
Common Stock or other capital stock which the Warrantholder would have received if the Warrant had been exercised immediately prior
to such event upon payment of a Warrant Price that has been adjusted to reflect a fair allocation of the economics of such event
to the Warrantholder. Such adjustments shall be made successively whenever any event listed above shall occur.


 



    	- 3 -



    	 



    

(b)          If
any capital reorganization, reclassification of the capital stock of the Company, consolidation or merger of the Company with another
corporation in which the Company is not the survivor, or sale, transfer or other disposition of all or substantially all of the
Company’s assets to another corporation shall be effected, then, as a condition of such reorganization, reclassification,
consolidation, merger, sale, transfer or other disposition, lawful and adequate provision shall be made whereby the Warrantholder
shall thereafter have the right to purchase and receive upon the basis and upon the terms and conditions herein specified and in
lieu of the Warrant Shares immediately theretofore issuable upon exercise of the Warrant, such shares of stock, securities or assets
as would have been issuable or payable with respect to or in exchange for a number of Warrant Shares equal to the number of Warrant
Shares immediately theretofore issuable upon exercise of the Warrant, had such reorganization, reclassification, consolidation,
merger, sale, transfer or other disposition not taken place, and in any such case appropriate provision shall be made with respect
to the rights and interests of the Warrantholder to the end that the provisions hereof (including, without limitation, provision
for adjustment of the Warrant Price) shall thereafter be applicable, as nearly equivalent as may be practicable in relation to
any shares of stock, securities or assets thereafter deliverable upon the exercise hereof. The Company shall not effect any such
consolidation, merger, sale, transfer or other disposition unless prior to or simultaneously with the consummation thereof the
successor corporation (if other than the Company) resulting from such consolidation or merger, or the corporation purchasing or
otherwise acquiring such assets or other appropriate corporation or entity shall assume the obligation to deliver to the Warrantholder,
at the last address of the Warrantholder appearing on the books of the Company, such shares of stock, securities or assets as,
in accordance with the foregoing provisions, the Warrantholder may be entitled to purchase, and the other obligations under this
Warrant. The provisions of this paragraph (b) shall similarly apply to successive reorganizations, reclassifications, consolidations,
mergers, sales, transfers or other dispositions.


 


(c)          In
case the Company shall fix a payment date for the making of a distribution to all holders of Common Stock (including any such distribution
made in connection with a consolidation or merger in which the Company is the continuing corporation) of evidences of indebtedness
or assets (other than cash dividends or cash distributions payable out of consolidated earnings or earned surplus or dividends
or distributions referred to in Section 8(a)), or subscription rights or warrants, the Warrant Price to be in effect after such
payment date shall be determined by multiplying the Warrant Price in effect immediately prior to such payment date by a fraction,
the numerator of which shall be the total number of shares of Common Stock outstanding multiplied by the Market Price (as defined
below) per share of Common Stock immediately prior to such payment date, less the fair market value (as determined by the Company’s
Board of Directors in good faith) of said assets or evidences of indebtedness so distributed, or of such subscription rights or
warrants, and the denominator of which shall be the total number of shares of Common Stock outstanding multiplied by such Market
Price per share of Common Stock immediately prior to such payment date. “Market Price” as of a particular date (the
“Valuation Date”) shall mean the following: (a) if the Common Stock is then listed on a national securities exchange,
the closing sale price of one share of Common Stock on such exchange on the last trading day prior to the Valuation Date; (b) if
the Common Stock is then quoted on an over-the-counter market or other exchange or association, the closing sale price of one share
of Common Stock on such market or such other exchange or association on the last trading day prior to the Valuation Date or, if
no such closing sale price is available, the average of the high bid and the low asked price quoted thereon on the last trading
day prior to the Valuation Date; or (c) if the Common Stock is not then listed on a national securities exchange or quoted on an
over-the-counter market or other exchange or association, the fair market value of one share of Common Stock as of the Valuation
Date, shall be determined in good faith by the Board of Directors of the Company and the Warrantholder. If the Common Stock is
not then listed on a national securities exchange, an over-the-counter market or other exchange or association, the Board of Directors
of the Company shall respond promptly, in writing, to an inquiry by the Warrantholder prior to the exercise hereunder as to the
fair market value of a share of Common Stock as determined by the Board of Directors of the Company. In the event that the Board
of Directors of the Company and the Warrantholder are unable to agree upon the fair market value in respect of subpart (c) hereof,
the Company and the Warrantholder shall jointly select an appraiser, who is experienced in such matters. The decision of such appraiser
shall be final and conclusive, and the cost of such appraiser shall be borne equally by the Company and the Warrantholder. Such
adjustment shall be made successively whenever such a payment date is fixed.



    	- 4 -



    	 



    

 


 


(d)          An
adjustment to the Warrant Price shall become effective immediately after the payment date in the case of each dividend or distribution
and immediately after the effective date of each other event which requires an adjustment.


 


(e)          In
the event that, as a result of an adjustment made pursuant to this Section 8, the Warrantholder shall become entitled to receive
any shares of capital stock of the Company other than shares of Common Stock, the number of such other shares so receivable upon
exercise of this Warrant shall be subject thereafter to adjustment from time to time in a manner and on terms as nearly equivalent
as practicable to the provisions with respect to the Warrant Shares contained in this Warrant.


 


Section 9.          Fractional
Interest. The Company shall not be required to issue fractions of Warrant Shares upon the exercise of this Warrant. If any
fractional share of Common Stock would, except for the provisions of the first sentence of this Section 9, be deliverable upon
such exercise, the Company, in lieu of delivering such fractional share, shall pay to the exercising Warrantholder an amount in
cash equal to the Market Price of such fractional share of Common Stock on the date of exercise.


 


Section 10.         Benefits.
Nothing in this Warrant shall be construed to give any person, firm or corporation (other than the Company and the Warrantholder)
any legal or equitable right, remedy or claim, it being agreed that this Warrant shall be for the sole and exclusive benefit of
the Company and the Warrantholder.


 


Section 11.         Notices
to Warrantholder. Upon the happening of any event requiring an adjustment of the Warrant Price, the Company shall promptly
give written notice thereof to the Warrantholder at the address appearing in the records of the Company, stating the adjusted Warrant
Price and the adjusted number of Warrant Shares resulting from such event and setting forth in reasonable detail the method of
calculation and the facts upon which such calculation is based. Failure to give such notice to the Warrantholder or any defect
therein shall not affect the legality or validity of the subject adjustment.


 


Section 12.         Notices.
Unless otherwise provided, any notice required or permitted under this Warrant shall be given in writing and shall be deemed effectively
given as hereinafter described (a) if given by personal delivery, then such notice shall be deemed given upon such delivery, (b)
if given by facsimile or other means of electronic transmission, then such notice shall be deemed given upon receipt of an automated
confirmation of complete transmittal, (c) if given by mail, then such notice shall be deemed given upon the earlier of (i) receipt
of such notice by the recipient or (ii) three days after such notice is deposited in first class mail, postage prepaid, and (d)
if given by an internationally recognized overnight air courier, then such notice shall be deemed given one business day after
delivery to such carrier. All notices shall be addressed as follows: if to the Warrantholder, at its address as set forth in the
Company’s books and records and, if to the Company, at the address as follows, or at such other address as the Warrantholder
or the Company may designate by ten days’ advance written notice to the other:



    	- 5 -



    	 



    

 


 


If to the Company:


 


Net Element, Inc.


1450 S. Miami
Avenue


Miami, Florida
33130


Attn: Chief Financial
Officer


Facsimile: 305) 358-7876


 


Section 13.         Intentionally
Omitted.


 


Section 14.         
Successors. All the covenants and provisions hereof by or for the benefit of the Warrantholder shall bind and inure to the
benefit of its respective successors and assigns hereunder.


 


Section 15.         Governing
Law; Consent to Jurisdiction; Waiver of Jury Trial. This Warrant shall be governed by, and construed in accordance with, the
internal laws of the State of Delaware, without reference to the choice of law provisions thereof. The Company and, by accepting
this Warrant, the Warrantholder, each irrevocably submits to the exclusive jurisdiction of the courts of the State of Florida located
in Miami-Dade County and federal courts located in Miami-Dade County, Florida for the purpose of any suit, action, proceeding or
judgment relating to or arising out of this Warrant and the transactions contemplated hereby. Service of process in connection
with any such suit, action or proceeding may be served on each party hereto anywhere in the world by the same methods as are specified
for the giving of notices under this Warrant. The Company and, by accepting this Warrant, the Warrantholder, each irrevocably consents
to the jurisdiction of any such court in any such suit, action or proceeding and to the laying of venue in such court. The Company
and, by accepting this Warrant, the Warrantholder, each irrevocably waives any objection to the laying of venue of any such suit,
action or proceeding brought in such courts and irrevocably waives any claim that any such suit, action or proceeding brought in
any such court has been brought in an inconvenient forum.  EACH OF THE COMPANY AND, BY ITS ACCEPTANCE HEREOF, THE WARRANTHOLDER
HEREBY WAIVES ANY RIGHT TO REQUEST A TRIAL BY JURY IN ANY LITIGATION WITH RESPECT TO THIS WARRANT AND REPRESENTS THAT COUNSEL HAS
BEEN CONSULTED SPECIFICALLY AS TO THIS WAIVER.


 


Section 16.         No
Rights as Stockholder. Prior to the exercise of this Warrant, the Warrantholder shall not have or exercise any rights as a
stockholder of the Company by virtue of his ownership of this Warrant.


 


Section 17.         Amendment;
Waiver. Any term of this Warrant may be amended or waived upon the written consent of the Company and the holder of this Warrant.


 


Section 18.         Section
Headings. The section headings in this Warrant are for the convenience of the Company and the Warrantholder and in no way alter,
modify, amend, limit or restrict the provisions hereof.


 



    	- 6 -



    	 



    

 


IN WITNESS WHEREOF, the Company has caused this
Warrant to be duly executed, as of the 2nd day of February, 2012.


 


	 	NET ELEMENT, INC.
	 	 
	 	By:	 
	 	Name: Jonathan New
	 	Title: Chief Financial Officer


 



    	- 7 -



    	 



    

 


APPENDIX A


NET ELEMENT, INC.


WARRANT EXERCISE FORM


 


To Net Element, Inc.:


 


The undersigned hereby
irrevocably elects to exercise the right of purchase represented by the within Warrant (“Warrant”) for, and to purchase
thereunder by the payment of the Warrant Price and surrender of the Warrant, _______________ shares of Common Stock (“Warrant
Shares”) provided for therein, and requests that certificates for the Warrant Shares be issued as follows:


 


	 	 	 
	 	Name	 
	 	 	 
	 	 	 
	 	Address	 
	 	 	 
	 	Federal Tax ID or Social Security No.	 


 


and delivered by(certified
mail to the above address, or (electronically, if available (provide DWAC Instructions: ___________________), or (other (specify):
____________________________________________________________________________), and, if the number of Warrant Shares shall not be
all the Warrant Shares purchasable upon exercise of the Warrant, that a new Warrant for the balance of the Warrant Shares purchasable
upon exercise of this Warrant be registered in the name of the undersigned Warrantholder or the undersigned’s Assignee as
below indicated and delivered to the address stated below.


 


By signing below, the undersigned
hereby re-affirms that the representations and warranties contained in Section 4 of the Subscription Agreement (the “Subscription
Agreement”) dated December __, 2011 between the Company and the Warrantholder are true and correct in all material respects
with respect to the Warrantholder as of the time this exercise.


 


Dated: ___________________, ____


 


Note: The signature must correspond with the
name of the Warrantholder as written on the first page of the Warrant in every particular, without alteration or enlargement or
any change whatever, unless the Warrant has been assigned.


 


	 	Warrant Signature:	 
	 	 	 
	 	Name (please print):	 
	 	 	 
	 	 	 
	 	 	 
	 	 	Address
	 	 	 
	 	 	Federal Identification or
	 	 	Social Security No.


 



    	 



    	 



    

  


ASSIGNMENT FORM


 


(To assign the foregoing warrant, execute

this form and supply required information.

Do not use this form to exercise the warrant.)


 


FOR VALUE RECEIVED, the foregoing
Warrant and all rights evidenced thereby are hereby assigned to


 


_______________________________________________
whose address is


 


_______________________________________________________________.


 


_______________________________________________________________


 


	 	 	Dated:  ______________, _______
	 	 	 
	 	Holder's Signature:	_____________________________
	 	 	 
	 	Holder's Address:	_____________________________
	 	 	 
	 	 	_____________________________


 


Signature Guaranteed: ___________________________________________


 


NOTE: The signature to this Assignment Form
must correspond with the name as it appears on the face of the Warrant, without alteration or enlargement or any change whatsoever,
and must be guaranteed by a bank or trust company. Officers of corporations and those acting in a fiduciary or other representative
capacity should file proper evidence of authority to assign the foregoing Warrant.