Exhibit
10.41


 


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.


 


DiGITAL
ALLY, INC.


 


Warrant
To Purchase Common Stock


 


Warrant
No.:  __1____


 


Number
of Shares of Common Stock: 100,000


 


Date
of Issuance: March 24, 2014 (“Issuance Date”)


 


Digital
Ally, Inc., a Nevada corporation (the “Company”), hereby certifies that, for good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, HUDSON BAY MASTER FUND LTD.,
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), one hundred thousand
(100,000) 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 March 21, 2014 (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.


 




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●  EXERCISE
OF WARRANT.


 


	●	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)). 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 Company has received the 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 third (3rd) Trading
    Day following the date on which the Company has received the Exercise Notice, so long as the Holder delivers the Aggregate
    Exercise Price (or notice of a Cashless Exercise) on or prior to the second (2nd) Trading Day following the date on which
    the Company has received the Exercise Notice (the “Share Delivery Date”) (provided that if the Aggregate
    Exercise Price has not been delivered by such date, the 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. 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 three (3) 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


 




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	 	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.


 


Exercise
Price. For purposes of this Warrant, “Exercise Price” means $10.00, subject to adjustment as provided herein.


 


	●	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 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 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 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 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


 




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	 	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.


 


Cashless
Exercise. Notwithstanding anything contained herein to the contrary, if the Registration Statement (as defined in the Registration
Rights Agreement) 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)
	 	D


 


For
purposes of the foregoing formula:


 


	 	A=	the
    total number of shares with respect to which this Warrant is then being exercised.
	 	 	 
	 	B
    =	the
    arithmetic average of the Closing Sale Prices of the Common Stock for the five (5) consecutive Trading Days ending on the
    date immediately preceding the date of the Exercise Notice.
	 	 	 
	 	C
    =	the
    Exercise Price then in effect for the applicable Warrant Shares at the time of such exercise.
	 	 	 
	 	D
    =	the
    Closing Sale Price of the Common Stock on the date of the Exercise Notice.


 




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For
purposes of Rule 144(d) promulgated under the 1933 Act, as in effect on the date hereof, it is intended 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.


 


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.


 


Limitations
on Exercises.


 


(i)
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)(i). For purposes of this Section 1(f)(i), 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 this Warrant, in 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


 




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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)(i), 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) Business 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 (with such increase not effective until the sixty-first (61st)
day after delivery of such notice) 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)(i) 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)(i) 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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(ii)
Principal Market Regulation. The Company shall not be obligated to issue any shares of Common Stock upon exercise of this
Warrant and the Holder shall not have the right to receive upon exercise of this Warrant any shares of Common Stock if the issuance
of such shares of Common Stock would exceed that number of shares of Common Stock which the Company may issue upon exercise of
the SPA Warrants or otherwise without breaching the Company’s obligations under any applicable rules or regulations of any
applicable Eligible Market (the “Exchange Cap”), except that such limitation shall not apply in the event that
the Company (x) obtains the approval of its shareholders as required by the applicable rules of the Eligible Market for issuances
of shares of Common Stock in excess of such amount or (y) obtains a written opinion from outside counsel to the Company that such
approval is not required, which opinion shall be reasonably satisfactory to the Required Holders. Until such approval or written
opinion is obtained, no Holder shall be issued in the aggregate, upon exercise of any SPA Warrants, shares of Common Stock in
an amount greater than the product of the Exchange Cap multiplied by a fraction, the numerator of which is the total number of
shares of Common Stock underlying the SPA Warrants issued to such Holder pursuant to the Securities Purchase Agreement on the
Issuance Date and the denominator of which is the aggregate number of shares of Common Stock underlying the SPA Warrants issued
to the Buyers pursuant to the Securities Purchase Agreement on the Issuance Date (with respect to each Holder, the “Exchange
Cap Allocation”). In the event that any Holder shall sell or otherwise transfer any of such Holder’s SPA Warrants,
the transferee shall be allocated a pro rata portion of such Holder’s Exchange Cap Allocation, and the restrictions of the
prior sentence shall apply to such transferee with respect to the portion of the Exchange Cap Allocation allocated to such transferee.
In the event that any holder of SPA Warrants shall exercise all of such holder’s SPA Warrants into a number of shares of
Common Stock which, in the aggregate, is less than such holder’s Exchange Cap Allocation, then the difference between such
holder’s Exchange Cap Allocation and the number of shares of Common Stock actually issued to such holder shall be allocated
to the respective Exchange Cap Allocations of the remaining holders of SPA Warrants on a pro rata basis in proportion to the shares
of Common Stock underlying the SPA Warrants then held by each such holder. In the event that the Company is prohibited from issuing
any Warrant Shares for which an Exercise Notice has been received as a result of the operation of this Section 1(f)(ii), then
unless the Holder elects to void such exercise, the Holder may require the Company to pay to the Holder within three (3) Trading
Days of the applicable attempted 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(f)(ii), 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 Fundamental Transaction” 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 the Exchange Cap” 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.”


 


	●	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 130% of 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 shareholders for the approval of an increase in the number of authorized
    shares of Common Stock. In connection with such meeting, the Company shall provide each shareholder with a proxy statement
    and shall use its best efforts to solicit its shareholders’ approval of such increase in authorized shares of Common
    Stock and to cause its board of directors to recommend to the shareholders that they approve such proposal. 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 Fundamental Transaction” 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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●
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:


 


(i)
Adjustment Upon Issuance of Shares of Common Stock. If and whenever on or after the Subscription Date, 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. Upon each such adjustment of the Exercise Price hereunder, the number of Warrant Shares issuable immediately prior to such
Dilutive Issuance shall be adjusted to the number of shares of Common Stock determined by multiplying the Exercise Price then
in effect immediately prior to such adjustment by the number of Warrant Shares acquirable upon exercise of this Warrant immediately
prior to such adjustment and dividing the product thereof by the Exercise Price resulting from such adjustment. For purposes of
determining the adjusted Exercise Price under this Section 2(a), the following shall be applicable:


 


(1)(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 or number of Warrant Shares 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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(2)(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 or number of Warrant Shares 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 or number of Warrant Shares
shall be made by reason of such issue or sale.


 


(3)(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 and the number of Warrant Shares in effect at the time of such increase or decrease shall be adjusted to the
Exercise Price and the number of Warrant Shares, 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 or a decrease in the number of Warrant Shares.


 


(4)(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


 




    	- 9 -



    	 



    

 


payable
by the Company pursuant to the terms of such other securities of the Company, less (II) the Option Value. 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.


 


(5)(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.


 


(6)(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.


 


	●	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.


 




    	- 10 -



    	 



    

 


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(c) shall become effective
at the close of business on the date the subdivision or combination becomes effective.


 


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.


 


●
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 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).


 




    	- 11 -



    	 



    

 


● PURCHASE
RIGHTS; FUNDAMENTAL TRANSACTIONS.


 


(ii)
Purchase Rights. In addition to any adjustments pursuant to Section 2 above, if at any time 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 shares of Common Stock are to be determined for the grant, issue 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 shares of 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 held similarly
in abeyance) to the same extent as if there had been no such limitation).


 


	●	Fundamental
    Transactions. The Company shall not enter into or be party to a Fundamental Transaction unless (i) the Successor Entity assumes
    in writing all of the obligations of the Company under this Warrant and the other Transaction Documents in accordance with
    the provisions of this Section 4(b) pursuant to written agreements in form and substance satisfactory to the Required Holders
    and approved by the Required Holders prior to such Fundamental Transaction, including agreements , if so requested by the
    Holder, to deliver to each holder of the SPA Warrants in exchange for such SPA Warrants a security of the Successor Entity
    evidenced by a written instrument substantially similar in form and substance to this Warrant, including, without limitation,
    an adjusted exercise price equal to the value for the shares of Common Stock reflected by the terms of such Fundamental Transaction,
    and 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 satisfactory to the Required Holders, 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


 




    	- 12 -



    	 



    

 


		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 occurrence or consummation of such Fundamental Transaction), and (ii) the Successor Entity
                                                                            (including its Parent Entity) is a publicly traded corporation whose common stock is quoted on or listed for trading on an
                                                                            Eligible Market. Any security issuable or potentially issuable to the Holder pursuant to the terms of this Warrant on the
                                                                            consummation of a Fundamental Transaction shall be registered and freely tradable by the Holder without any restriction or
                                                                            limitation or the requirement to be subject to any holding period pursuant to any applicable securities laws. Upon the
                                                                            occurrence or consummation of any Fundamental Transaction, and it shall be a required condition to the occurrence or
                                                                            consummation of any Fundamental Transaction that, the Company and the Successor Entity or Successor Entities, jointly and
                                                                            severally, shall succeed to, and the Company shall cause any Successor Entity or Successor Entities to jointly and severally
                                                                            succeed to, and be added to the term “Company” under this Warrant (so that from and after the date of such
                                                                            Fundamental Transaction, each and every provision of this Warrant referring to the “Company” shall refer instead
                                                                            to each of the Company and the Successor Entity or Successor Entities, jointly and severally), and the Company and the
                                                                            Successor Entity or Successor Entities, jointly and severally, may exercise every right and power of the Company
                                                                            prior thereto and shall assume all of the obligations of the Company prior thereto under this Warrant with the same effect as
                                                                            if the Company and such Successor Entity or Successor Entities, jointly and severally, had been named as the Company in this
                                                                            Warrant, and, solely at the request of the Holder, if the Successor Entity and/or Successor Entities is a publicly traded
                                                                            corporation whose common stock is quoted on or listed for trading on an Eligible Market, shall deliver (in addition to and
                                                                            without limiting any right under this Warrant) to the Holder in exchange for this Warrant a security of the Successor Entity
                                                                            and/or Successor Entities evidenced by a written instrument substantially similar in form and substance to this Warrant and
                                                                            exercisable for a corresponding number of shares of capital stock of the Successor Entity and/or Successor Entities (the
                                                                            “Successor 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 (such corresponding number of shares of Successor Capital Stock to be delivered to the Holder shall be equal to
                                                                            the greater of (A) the quotient of (i) the aggregate dollar value of all consideration (including cash consideration and any
                                                                            consideration other than cash (“Non-Cash Consideration”), in such Fundamental Transaction, as such values
                                                                            are set forth in any definitive agreement for the Fundamental Transaction that has been executed at the time of the first
                                                                            public announcement of the Fundamental Transaction or, if no such value is determinable from such definitive agreement, as
                                                                            determined in accordance with Section 12 with the term “Non-Cash Consideration” being substituted for the term
                                                                            “Exercise Price”) that the Holder would have been entitled to receive upon the happening of such Fundamental
                                                                            Transaction or the record, eligibility or other determination date for the event resulting in such Fundamental Transaction,
                                                                            had this Warrant been exercised immediately prior to such Fundamental Transaction or the record, eligibility or
                                                                            other determination date for the event resulting in such Fundamental Transaction (without regard to any limitations on the
                                                                            exercise of this Warrant) (the “Aggregate Consideration”) divided by (ii) the per share Closing Sale Price
                                                                            of such Successor Capital Stock on the Trading Day immediately prior to the consummation or occurrence of the Fundamental
                                                                            Transaction and (B) the product of (i) the Aggregate Consideration and (ii) the highest exchange ratio pursuant to which any
                                                                            stockholder of the Company may exchange Common Stock for



 




    	- 13 -



    	 



    

 


		Successor Capital
                                                                            Stock) (provided, however, to the extent that the Holder’s right to receive any such shares of publicly traded common
                                                                            stock (or their equivalent) of the Successor Entity would result in the Holder and its other Attribution Parties exceeding
                                                                            the Maximum Percentage, if applicable, then the Holder shall not be entitled to receive such shares to such extent (and shall
                                                                            not be entitled to beneficial ownership of such shares of publicly traded common stock (or their equivalent) of the Successor
                                                                            Entity as a result of such consideration to such extent) and the portion of such shares shall be held in abeyance for the
                                                                            Holder until such time or times, as its right thereto would not result in the Holder and its other Attribution Parties
                                                                            exceeding the Maximum Percentage, at which time or times the Holder shall be delivered such shares to the extent as if there
                                                                            had been no such limitation), and such security shall be satisfactory to the Holder, and with an identical exercise price to
                                                                            the Exercise Price hereunder (such adjustments to the number of shares of capital stock and such exercise price being for the
                                                                            purpose of protecting after the consummation or occurrence of such Fundamental Transaction the economic value of this Warrant
                                                                            that was in effect immediately prior to the consummation or occurrence of such Fundamental Transaction, as elected by the
                                                                            Holder solely at its option). Upon occurrence or consummation of the Fundamental Transaction, and it shall be a required
                                                                            condition to the occurrence or consummation of such Fundamental Transaction that, the Company and the Successor Entity or
                                                                            Successor Entities shall deliver to the Holder confirmation that there shall be issued upon exercise of this Warrant at any
                                                                            time after the occurrence or consummation of the Fundamental Transaction, as elected by the Holder solely at its option,
                                                                            shares of Common Stock, Successor Capital Stock or, in lieu of the shares of Common Stock or Successor Capital Stock
                                                                            (or other securities, cash, assets or other property purchasable upon the exercise of this 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), which for purposes of clarification may continue to be shares of Common Stock, if any, that
                                                                            the Holder would have been entitled to receive upon the happening of such Fundamental Transaction or the record, eligibility
                                                                            or other determination date for the event resulting in such Fundamental Transaction, had this Warrant been exercised
                                                                            immediately prior to such Fundamental Transaction or the record, eligibility or other determination date for the event
                                                                            resulting in such Fundamental Transaction (without regard to any limitations on the exercise of this Warrant), as adjusted in
                                                                            accordance with the provisions of this Warrant. In addition to and not in substitution for any other rights hereunder, prior
                                                                            to the occurrence or consummation of any Fundamental Transaction pursuant to which holders of shares of Common Stock are
                                                                            entitled to receive securities, cash, assets or other property with respect to or in exchange for shares of Common Stock (a
                                                                            “Corporate Event”), the Company shall make appropriate provision to insure that, and any applicable
                                                                            Successor Entity or Successor Entities shall ensure that, and it shall be a required condition to the occurrence or
                                                                            consummation of such Corporate Event that, the Holder will thereafter have the right to receive upon exercise of this Warrant
                                                                            at any time after the occurrence or consummation of the Corporate Event, shares of Common Stock or Successor Capital Stock
                                                                            or, if so elected by the Holder, in lieu of the shares of Common Stock (or other securities, cash, assets or other property)
                                                                            purchasable upon the exercise of this Warrant prior to such Corporate Event (but not in lieu of such items still issuable
                                                                            under Sections 3 and 4(a), which shall continue to be receivable on the Common Stock or on the such shares of stock,
                                                                            securities, cash, assets or any other property otherwise receivable with respect to or in exchange for shares of
                                                                            Common Stock), such shares of stock, securities, cash, assets or any other property whatsoever (including



 




    	- 14 -



    	 



    

 


		warrants or
                                                                            other purchase or subscription rights and any shares of Common Stock) which the Holder would have been entitled to receive
                                                                            upon the occurrence or consummation of such Corporate Event or the record, eligibility or other determination date for the
                                                                            event resulting in such Corporate Event, had this Warrant been exercised immediately prior to such Corporate Event or the
                                                                            record, eligibility or other determination date for the event resulting in such Corporate Event (without regard to any
                                                                            limitations on exercise of this Warrant). 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 Fundamental Transaction, at the request of the Holder delivered before the ninetieth (90th)
day after the occurrence or consummation of such Fundamental Transaction, 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 Fundamental Transaction), cash in an amount equal to the Black Scholes Value of the remaining unexercised portion
of this Warrant on the date of such Fundamental Transaction.


 


● NON
CIRCUMVENTION. The Company hereby covenants and agrees that the Company will not, by amendment of its Articles 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, 130% of 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).


 


● WARRANT
HOLDER NOT DEEMED A SHAREHOLDER. 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 share capital 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 shareholder 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


 




    	- 15 -



    	 



    

 


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 shareholder 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 shareholders of the Company
generally, contemporaneously with the giving thereof to the shareholders.


 


● REISSUANCE
OF WARRANTS.


 


(iii)
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.


 


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.


 


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.


 


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.


 




    	- 16 -



    	 



    

 


●
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, 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.


 


● AMENDMENT
AND WAIVER. Except as otherwise provided herein, the provisions of this Warrant may be amended or waived and the Company
may take any action herein prohibited, or omit to perform any act herein required to be performed by it, only if the Company
has obtained the written consent of the Holder.


 


● 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 the Company at the address set forth in
Section 9(f) of the Securities Purchase Agreement and agrees that such service shall constitute


 




    	- 17 -



    	 



    

 


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.


 


● CONSTRUCTION;
HEADINGS. This Warrant shall be deemed to be jointly drafted by the Company and all 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.


 


● 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 within two (2)
Business Days 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
three (3) Business Days of such disputed determination or arithmetic calculation being submitted to the Holder, then the
Company shall, within two (2) Business Days submit via facsimile (a) the disputed determination of the Exercise Price to an
independent, reputable investment bank selected by the Company and approved by the Holder or (b) the disputed arithmetic
calculation of the Warrant Shares to the Company’s independent, outside accountant. 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 ten (10) 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.


 


● 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.


 




    	- 18 -



    	 



    

 


 


● 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.


 


● 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).


 


● 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 (as defined in the Securities Purchase Agreement), 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.


 


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


 


(iv)”1933
Act” means the Securities Act of 1933, as amended.


 


	●	“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.



 




    	- 19 -



    	 



    

 


(v)”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.


 


(vi)”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.


 


“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 Fundamental Transaction,
or, if the Fundamental Transaction is not publicly announced, the date the Fundamental Transaction 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 Fundamental
Transaction, or, if the Fundamental Transaction is not publicly announced, the date the Fundamental Transaction is consummated,
(iii) the underlying price per share used in such calculation shall be 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 Fundamental Transaction, (iv) a zero cost of borrow
and (v) a 360 day annualization factor.


 


“Bloomberg”
means Bloomberg Financial Markets.


 


“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.


 


“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


 




    	- 20 -



    	 



    

 


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.


 


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


 


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


 


“Eligible
Market” means the Principal Market, the NYSE MKT LLC, The NASDAQ Global Market, The NASDAQ Global Select Market or The
New York Stock Exchange, Inc.


 


“Excluded
Securities” means any Common Stock issued or issuable: (i) in connection with any Approved Stock Plan, (ii) pursuant
to the terms of the SPA Securities (including, without limitation, pursuant to a Company Conversion (as defined in the SPA Securities)
or upon exercise of the SPA Warrants; provided, that the terms of such SPA Securities or SPA Warrants are not amended,
modified or changed on or after the Subscription Date and (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.


 


“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.


 




    	- 21 -



    	 



    

 


	● 	“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 all 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 date of this Warrant 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 shareholders of the Company to surrender their shares of Common Stock without approval of
    the shareholders 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.


 




    	- 22 -



    	 



    

 


	●	“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.
	 	 
	●	“Lead
    Investor” means Hudson Bay Master Fund Ltd.


 


“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.


 


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


 


	●	“Parent
    Entity” of a Person means an entity that, directly or indirectly, controls the applicable Person, including such
    entity whose common shares or common stock 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.


 


“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.


 


“Principal
Market” means The NASDAQ Capital Market.


 


“Registration
Rights Agreement” means that certain Registration Rights Agreement dated as of the Subscription Date by and among the
Company and the Buyers.


 




    	- 23 -



    	 



    

 


“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 the Lead Investor so long as the Lead Investor or any of its Affiliates holds
any SPA Warrants.


 


“SPA
Securities” means the Notes issued pursuant to the Securities Purchase Agreement.


 


	●	“Subject
    Entity” means any Person, Persons or Group or any Affiliate or associate of any such Person, Persons or Group.
	 	 
	●	“Successor
    Entity” means one or more Person or Persons (or, if so elected by the Holder, the Company or Parent Entity) formed
    by, resulting from or surviving any Fundamental Transaction or one or more Person or Persons (or, if so elected by the Holder,
    the Company or the Parent Entity) with which such Fundamental Transaction shall have been entered into.


 


“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, then on the principal securities exchange or securities market on which the Common
Stock is then traded; provided that “Trading Day” shall not include any day on which the Common Stock is scheduled
to trade on such exchange or market for less than 4.5 hours or any day that the Common Stock is suspended from trading during
the final hour of trading on such exchange or market (or if such exchange or market does not designate in advance the closing
time of trading on such exchange or market, then during the hour ending at 4:00:00 p.m., New York time).


 


“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]


 




    	- 24 -



    	 



    

 


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.


 


	 	DIGITAL
    ALLY, INC.
	 	 	 
	 	By:	 
	 	Name:	 
	 	Title:	 


 




    	 



    	 



    

 


EXHIBIT
A


 


EXERCISE
NOTICE


 


TO
BE EXECUTED BY THE REGISTERED HOLDER TO EXERCISE THIS


WARRANT
TO PURCHASE COMMON STOCK


 


Digital
ally, inc. 


 


The
undersigned holder hereby exercises the right to purchase _________________ of the shares of Common Stock (“Warrant Shares”)
of Digital Ally, Inc., a Nevada 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:	 	 


 




    	 



    	 



    

  


ACKNOWLEDGMENT


 


The
Company hereby acknowledges this Exercise Notice and hereby directs First American Stock Transfer to issue the above indicated
number of shares of Common Stock in accordance with the Transfer Agent Instructions dated March 21, 2014 from the Company and
acknowledged and agreed to by First American Stock Transfer.


 


	 	DIGITAL
    ALLY, INC.
	 	 	 
	 	By:	 
	 	Name:	 
	 	Title: