Exhibit 10.5


 


 


 


 


 


 


 


 


 


 


 


WARRANT


 


to Purchase Common Stock of


 


Cadiz Inc.


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


Warrant No. W-2


Original Issue Date: July 2, 2021


 




     


    


    

 


THE SECURITIES REPRESENTED BY THIS CERTIFICATE
MAY NOT BE SOLD OR TRANSFERRED UNLESS (I) A REGISTRATION STATEMENT COVERING SUCH SECURITIES IS EFFECTIVE UNDER THE SECURITIES ACT OR (II)
THE TRANSACTION IS EXEMPT FROM REGISTRATION UNDER THE SECURITIES ACT AND APPLICABLE STATE SECURITIES LAWS.


 


	Original Issue Date: July 2, 2021	Warrant No. W-2


 


Warrant


 


to Purchase 500,000 Shares (Subject to Adjustment)
of Common Stock of


 


Cadiz Inc.


 


THIS IS TO CERTIFY THAT B. Riley Principal Investments, LLC (“Investor”),
or its registered assigns, is entitled, at any time during the Exercise Period (subject to Section 2.1(a)) to purchase from Cadiz Inc.,
a Delaware corporation (the “Company”), 500,000 shares (subject to adjustment
as provided herein) of the common stock, par value $0.01 per share, of the Company at a purchase price per share equal to $21.72 (the
initial “Exercise Price,” subject to adjustment as provided herein).


 


This Warrant was issued in
connection with that certain Credit Agreement (the “Credit Agreement”), dated as of July 2, 2021 (the “Effective
Date”), by and among the Company, as a borrower, Cadiz Real Estate LLC, as a borrower, B. Riley Commercial Capital, LLC, as
a lender, the other lenders party thereto, and B. Riley Securities, Inc., as agent (the “Agent”), and is subject to
the terms thereof.


 


		1.	DEFINITIONS



 


As used in this Warrant, the
following terms have the respective meanings set forth below, and to the extent such terms have the respective meaning set forth in the
Credit Agreement, such terms shall have such meaning as set forth in the Credit Agreement, provided, however, that if such
Credit Agreement is expired, terminated or otherwise discharged, such terms shall have the meaning set forth in the Credit Agreement immediately
prior to such expiration, termination or discharge:


 


“10-Day
VWAP” for any date of determination means the per share volume-weighted average price of Common Stock, as displayed under
the heading “Bloomberg VWAP” on Bloomberg page CDZI <equity> VWAP (or its equivalent successor if such page is not available),
from the scheduled open of trading until the scheduled close of trading of the primary trading session of the NASDAQ Global Market on
each trading day during the 10 consecutive trading day period preceding (but not including) such date of determination (or if such volume-weighted
average price is unavailable, the market value of one share of Common Stock during such period determined, using a volume-weighted average
method, by a nationally recognized independent investment banking firm retained for this purpose by the Company). The VWAP will be determined
without regard to after-hours trading or any other trading outside of the regular trading session trading hours.


 




     


     


    

 


“Affiliate”
of, or a Person “Affiliated” with, a specified Person means any other Person
directly or indirectly controlling, controlled by, or under common control with, that Person. For the purposes of this definition, “control”
(including, with correlative meanings, the terms “controlling,” “controlled by” and “under common control
with”), as applied to any Person, means the possession, directly or indirectly, of the power (i) to vote 20% or more of the securities
having ordinary voting power for the election of directors (or persons performing similar functions) of such Person, or (ii) to direct
or cause the direction of the management and policies of that Person, whether by contract or otherwise.


 


“Agent”
shall have the meaning set forth in the preamble to this Warrant.


 


“Aggregation Date”
shall have the meaning set forth in Section 5.2 hereof.


 


“Applicable
Rate” shall have the meaning ascribed to such term in the Credit Agreement.


 


“Appraisal
Procedure” means the following procedure to determine the fair market value, as to any security, for purposes of the
definition of “Fair Market Value“ or the fair market value, as to any other
property (in either case, the “Valuation Amount“). The Valuation Amount shall
be determined in good faith jointly by the Company and the Required Holders; provided, however, that if such parties are
not able to agree on the Valuation Amount within a reasonable period of time (not to exceed 20 Business Days), the Valuation Amount shall
be determined by the mutual agreement of two independent appraisers, one appointed by the Company and one appointed by the Required Holders,
with each appointed within 10 days of the Appraisal Procedure having been first invoked by the Required Holders. The Company and the Required
Holders shall submit their respective valuations and other relevant data to the appraisers, and the appraisers shall, within 20 days of
the later of the two appraisers’ appointment dates, mutually agree to a determination of the Valuation Amount. If such appraisers
cannot mutually agree on the Valuation Amount by such date, a third independent appraiser shall be chosen within 10 days of such date
by the mutual consent of the first two appraisers. Such third appraiser shall make a determination of the Valuation Amount within 20 days
of its appointment. If three appraisers shall have been appointed and made determinations of the Valuation Amount, then the average of
the three Valuation Amounts shall be final and binding on the Company and the Required Holders as the final Valuation Amount, provided,
however, that if the determination of one appraiser differs by an amount equal to more than twice that of the middle of the three
appraisers’ Valuation Amounts (the “Outlier Appraiser”), then the determination of the Outlier Appraiser shall
be excluded from determining the final Valuation Amount and the remaining two appraisers’ determinations of the Valuation Amount
shall be averaged and such average shall be final and binding upon the Company and the Required Holders as the final Valuation Amount.
The Company shall pay all of the fees and expenses incurred in conducting the Appraisal Procedure.


 


“beneficial owner”
and “beneficially own” shall have the meaning set forth under Section 13(d) of the Exchange Act.


 


“Beneficial Ownership
Limitation” has the meaning set forth in Section 5.1 hereof.


 


“Business
Day” shall have the meaning ascribed to such term in the Credit Agreement.


 




    2


     


    

 


“Commission”
means the Securities and Exchange Commission or any other federal agency then administering the Securities Act and other federal securities
laws.


 


“Common
Stock” means the common stock, par value $0.01 per share, of the Company as constituted on the Original Issue Date, and
any capital stock into which such Common Stock may thereafter be changed, and shall also include (i) capital stock of the Company of any
other class (regardless of how denominated) issued to the holders of shares of any Common Stock upon any reclassification thereof which
is also not preferred as to dividends or liquidation over any other class of stock of the Company and which is not subject to redemption
and (ii) shares of common stock of any successor or acquiring corporation received by or distributed to the holders of Common Stock of
the Company in the circumstances contemplated by Section 4.6 hereof.


 


“Company”
shall have the meaning set forth in the preamble to this Warrant.


 


“Credit
Agreement” shall have the meaning set forth in the preamble to this Warrant.


 


“Delivery
Notice” shall have the meaning set forth in Section 5.1(c) hereof.


 


“Designated
Office” shall have the meaning set forth in Section 9 hereof.


 


“DOJ” shall
have the meaning set forth in Section 6.4 hereof.


 


“DTC” shall
have the meaning set forth in Section 2.1(b) hereof.


 


“DWAC”
shall have the meaning set forth in Section 2.1(b) hereof.


 


“Exchange
Act” means the Securities Exchange Act of 1934, as amended, and the rules and regulations of the Commission promulgated
thereunder, all as the same shall be in effect at the time.


 


“Exercise
Date” shall have the meaning set forth in Section 2.1(a) hereof.


 


“Exercise
Notice” shall have the meaning set forth in Section 2.1(a) hereof.


 


“Exercise
Period” means the period commencing one hundred eighty (180) days after the Original Issue Date, and before 4:00 P.M.,
Eastern Standard Time, on the Expiration Date.


 


“Exercise
Price” means, in respect of a share of Warrant Stock at any date herein specified, the initial Exercise Price set forth
in the preamble of this Warrant, as adjusted from time to time pursuant to Article 4 hereof.


 


“Expiration
Date” means the third anniversary of the Original Issue Date, to be extended to allow for delayed exercise and delivery
of any Warrant Stock in accordance with Section 5.1(c) hereof.


 


“Expiration Warrant
Stock” shall have the meaning set forth in Section 5.1(c) hereof.


 




    3


     


    

 


“Fair
Market Value” means (i) as to any Common Stock listed or quoted on a Trading Market, the 10-Day VWAP determined in respect
of such primary Trading Market and (ii) as to any Common Stock not listed or quoted on a Trading Market or any other security, (A) the
Ten Day Average of the average closing prices of such security’s sales on all domestic securities exchanges on which such security
may at the time be listed, or (B) if there have been no sales on any such exchange such that the foregoing Ten Day Average cannot be calculated,
the average of the highest bid and lowest asked prices on all such exchanges at the end of the Business Day immediately prior to the date
that Fair Market Value is determined as of, or (C) if on any day such security is not listed any domestic securities exchange such that
neither the foregoing Ten Day Average nor the foregoing bid-and-asked price average can be calculated, the average of the highest bid
and lowest asked prices at the end of the Business Day immediately prior to the date that Fair Market Value is determined in the domestic
over-the-counter market as reported by the National Association of Securities Dealers Automated Quotation System or similar organization
(and in each such case excluding any trades that are not bona fide, arm’s length transactions). If neither the foregoing clause
(i) nor clause (ii) is applicable, then (i) the “Fair Market Value” of such security as of an applicable determination date
shall be as determined in accordance with the Appraisal Procedure.


 


“FTC” shall
have the meaning set forth in Section 6.4 hereof.


 


“Governmental
Authority” shall have the meaning set forth in the Credit Agreement.


 


“Holder“”
means with respect to any Warrant or share of Warrant Stock, the Person in whose name the Warrant or Warrant Stock is registered on the
books of the Company maintained for such purpose.


 


“Holder Group”
shall have the meaning set forth in Section 5.1(d) hereof.


 


“HSR Act”
shall have the meaning set forth in Section 6.4 hereof.


 


“Investor”
shall have the meaning set forth in the preamble to this Warrant.


 


“Lien”
means (i) any lien, mortgage, pledge, assignment, security interest, charge or encumbrance of any kind (including any agreement to give
any of the foregoing, any conditional sale or other title retention agreement, and any lease in the nature thereof) and any option, trust
or other preferential arrangement having the practical effect of any of the foregoing, and (ii) in the case of securities, any purchase
option, call or similar right of a third party with respect to such securities.


 


“Maximum Percentage”
shall have the meaning set forth in Section 5.1 hereof.


 


“Original
Issue Date” means July 2, 2021, the date on which this Warrant was issued by the Company pursuant to the Credit Agreement.


 


“Outlier Appraiser”
shall have the meaning set forth in Article 1 hereof.


 


“Outstanding”
means, subject to Section 5.1(d) hereof, when used with reference to Common Stock, at any date as of which the number of shares thereof
is to be determined, all issued and actually outstanding shares of Common Stock, except shares then owned or held by or for the account
of the Company or any Subsidiary, and shall include all shares issuable in respect of outstanding scrip or any certificates representing
fractional interests in shares of Common Stock.


 




    4


     


    

 


“Person”
means and includes natural persons, corporations, limited partnerships, general partnerships, limited liability companies, limited liability
partnerships, joint stock companies, joint ventures, associations, companies, trusts, banks, trust companies, land trusts, business trusts
or other organizations, whether or not legal entities, and Governmental Authority.


 


“Reference Price”
shall have the meaning set forth in Section 4.1 hereof.


 


“Related Issuances”
shall have the meaning set forth in Section 5.2 hereof.


 


“Required Holders”
means holders of outstanding Warrants representing more than 50% of the Warrant Stock issuable upon exercise of such outstanding Warrants.


 


“Securities
Act” means the Securities Act of 1933, as amended, and the rules and regulations of the Commission promulgated thereunder,
all as the same shall be in effect at the time.


 


“Stockholder Approval”
means the approval by the stockholders of the Company for purposes of terminating the issuance cap in respect of shares of Common Stock
set forth in Section 5.2 hereof.


 


“Subsidiary”
means any corporation, association, trust, limited liability company, partnership, joint venture or other business association or entity
(i) at least 50% of the Outstanding voting securities of which are at the time owned or controlled, directly or indirectly, by the Company;
or (ii) with respect to which the Company possesses, directly or indirectly, the power to direct or cause the direction of the affairs
or management of such Person.


 


“Ten
Day Average” means, with respect to any prices and in connection with the calculation of Fair Market Value, the average
of such prices over the ten consecutive Business Days ending on the Business Day immediately prior to the day as of which “Fair
Market Value” is being determined.


 


“Trading Day”
means any day that the primary Trading Market on which the Common Stock is listed or quoted is open for trading.


 


“Trading Market”
means any of the following markets or exchanges on which the Common Stock is listed or quoted for trading on the date in question: the
NYSE MKT, the Nasdaq Capital Market, the Nasdaq Global Market, the Nasdaq Global Select Market, the New York Stock Exchange, OTCQB or
OTCQX (or any successors to any of the foregoing).


 


“Transfer Agent”
shall have the meaning set forth in Section 2.1(b) hereof.


 


“Valuation Amount”
shall have the meaning set forth in Article 1 hereof.


 


“Warrant
Price” means an amount equal to (i) the number of shares of Warrant Stock being purchased upon exercise of this Warrant
pursuant to Section 2.1 hereof, multiplied by (ii) the Exercise Price.


 




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“Warrant”
means this Warrant and all warrants issued upon transfer, division or combination of, or in substitution for, this Warrant, or any other
like warrant subsequently issued to the Holder. All such foregoing warrants shall at all times be identical as to terms and conditions,
except as to the number of shares of Warrant Stock for which they may be exercised and their date of issuance.


 


“Warrants”
means this Warrant and all other warrants to purchase Common Stock, in the same form as this Warrant, issued to the lenders party to the
Credit Agreement.


 


“Warrant
Stock” means the shares of Common Stock issued, issuable or both (as the context may require) upon the exercise of this
Warrant.


 


		2.	EXERCISE OF WARRANT



 


2.1 Manner
of Exercise.


 


(a) At
any time during the Exercise Period, the Holder of this Warrant may from time to time exercise this Warrant, on any Business Day, for
all or any part of the number of shares of Warrant Stock (subject to adjustment as provided herein) purchasable hereunder; provided,
in the event all amounts due under the Loan Documents (as defined in the Credit Agreement), including but not limited to, all outstanding
principal amount and unpaid interests, are paid in full within one hundred eighty (180) days after the Original Issue Date, this Warrant
shall not become exercisable and shall instead terminate upon such payment in full. In order to exercise this Warrant, in whole or in
part, the Holder shall (i) deliver to the Company at its Designated Office a written notice of the Holder’s election to exercise
this Warrant (an “Exercise Notice“) substantially in the form attached to
this Warrant as Annex A, which Exercise Notice shall be irrevocable and specify the number of shares of Warrant Stock to be purchased,
together with this Warrant and (ii) pay to the Company the Warrant Price (in accordance with one of the methods specified in Section 2.1(c)
hereof). The date on which such delivery and payment shall have taken place being hereinafter referred to as the “Exercise
Date.” Except as otherwise provided in this Section 2.1(a), any payment after the Original Issue Date of all remaining
principal and interest outstanding under the Credit Agreement shall not affect the ability of the Holder to exercise this Warrant.

 


(b) Subject
to Article 5 hereof, upon receipt by the Company of such Exercise Notice, surrender of this Warrant and payment of the Warrant Price (in
accordance with Section 2.1(c) hereof), the Company shall cause its Transfer Agent to deliver the applicable shares of Warrant Stock,
and the Company shall deliver or cause to be delivered cash in lieu of any fraction of a share, to the Holder and register such issued
shares of Warrant Stock on the books of the Company as instructed by the Holder in the Exercise Notice. The issued shares of Warrant Stock
will be delivered by crediting the account of the Holder’s prime broker (as specified by the Holder to the Company) with the Depository
Trust Company (“DTC”) through its Deposit/Withdrawal At Custodian (“DWAC”)
system, whereby the Holder’s prime broker shall initiate a DWAC transaction no later than 4:00 p.m. Eastern Standard Time on the
third Trading Day following the Exercise Date using its DTC participant identification number, and released by Continental Stock Transfer
& Trust Company, the Company’s transfer agent (or any successor transfer agent of the Company) (the “Transfer
Agent”), at the Company’s direction. The Holder shall direct the broker-dealer at which the account or accounts
to be credited with the issued shares of Warrant Stock are maintained, which broker/dealer shall be a DTC participant, to initiate a transaction
through the DWAC system, instructing the Transfer Agent to credit such account or accounts with such shares of Warrant Stock. Such DWAC
instruction shall indicate the settlement date for the deposit of such shares of Warrant Stock, which shall be the Exercise Date. The
Company shall direct the Transfer Agent to credit the Holder’s account or accounts with such shares of Warrant Stock pursuant to
the information contained in the DWAC instruction. This Warrant shall be deemed to have been exercised and such shares of Warrant Stock
shall be deemed to have been issued, and the Holder or any other Person so designated to be named therein shall be deemed to have become
a holder of record of such shares of Warrant Stock for all purposes, as of the Exercise Date.


 




    6


     


    

 


(c) Subject
to Article 5 hereof, payment of the Warrant Price shall be made at the option of the Holder by one or more of the following methods: (i)
by delivery of a certified or official bank check or by wire transfer of immediately available funds in the amount of such Warrant Price
payable to the order of the Company, (ii) by instructing the Company to withhold a number of shares of Warrant Stock then issuable upon
exercise of this Warrant with an aggregate Fair Market Value equal to such Warrant Price, (iii) by surrendering to the Company shares
of Common Stock previously acquired by the Holder with an aggregate Fair Market Value equal to such Warrant Price, or (iv) any combination
of the foregoing. In the event of any withholding of Warrant Stock or surrender of Common Stock pursuant to clause (ii), (iii) or (iv)
of this Section 2.1(c) where the number of shares whose Fair Market Value is equal to the Warrant Price is not a whole number, the number
of shares withheld by or surrendered to the Company shall be rounded up to the nearest whole share and the Company shall make a cash payment
to the Holder based on the incremental fraction of a share being so withheld by or surrendered to the Company in an amount determined
in accordance with Section 2.3 hereof. The Holder will receive fully paid and nonassessable shares of Warrant Stock upon any exercise
of this Warrant.


 


(d) If
this Warrant shall have been exercised in part, the Company shall, at the time of delivery of the shares of Warrant Stock being issued
in accordance with Section 2.1(c) hereof, deliver to the Holder a new Warrant evidencing the rights of the Holder to purchase the unpurchased
shares of Warrant Stock called for by this Warrant. Such new Warrant shall in all other respects be identical to this Warrant.


 


(e) Subject
to Section 2.1(d) hereof, the Warrant delivered for exercise, and properly exercised by the Holder, in accordance with Sections 2.1(a)-(c)
and Article 5 hereof shall be canceled by the Company.


 


2.2 Payment
of Taxes. All shares of Warrant Stock issuable upon the exercise of this Warrant pursuant to the terms hereof shall be validly issued,
fully paid and nonassessable, issued without violation of any preemptive or similar rights of any stockholder of the Company and free
and clear of all Liens. The Company shall pay all expenses in connection with, and all taxes and other governmental charges that may be
imposed with respect to, the issue or delivery thereof.


 


2.3 Fractional
Shares. The Company shall not be required to issue a fractional share of Warrant Stock upon exercise of the Warrant. As to any fraction
of a share that the Holder of the Warrant, the rights under which are exercised in the same transaction, would otherwise be entitled to
purchase upon such exercise, the Company shall pay to the Holder an amount in cash equal to such fraction multiplied by the Fair Market
Value of one share of Common Stock on the Exercise Date.


 




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		3.	TRANSFER, DIVISION AND COMBINATION



 


3.1 Transfer.
Upon compliance with the provisions of this Section 3.1, each transfer of this Warrant and all rights hereunder, in whole or in part,
shall be registered on the books of the Company to be maintained for such purpose, upon surrender of this Warrant at the Designated Office
and compliance with the terms hereof, together with a written assignment of this Warrant in the form of Annex B attached hereto
duly executed by the Holder or its agent or attorney and funds sufficient to pay any transfer taxes described in Section 2.2 hereof in
connection with the making of such transfer. Upon such compliance, surrender and delivery and, if required, such payment, the Company
shall execute and deliver a new Warrant in the name of the assignee or assignees and in the denominations specified in such instrument
of assignment, and shall issue to the assignor a new Warrant evidencing the portion of this Warrant not so assigned and this Warrant shall
promptly be cancelled.


 


3.2 Mutilation
or Loss. Upon receipt by the Company from the Holder of evidence reasonably satisfactory to it of the loss, theft, destruction or
mutilation of this Warrant and an indemnity reasonably satisfactory to it (it being understood that the written indemnification agreement
of or affidavit of loss of the Holder shall be a sufficient indemnity) and, in case of mutilation, upon surrender and cancellation hereof,
the Company will execute and deliver in lieu hereof a new Warrant of like tenor to the Holder; provided, however, that,
in the case of mutilation, no indemnity shall be required if this Warrant in identifiable form is surrendered to the Company for cancellation.


 


3.3 Division
and Combination. Subject to compliance with the applicable provisions of this Warrant, this Warrant may be divided or, following such
division, combined with other Warrants upon presentation hereof at the Designated Office, together with a written notice specifying the
names and denominations in which new Warrants are to be issued, signed by the Holder or its agent or attorney. Subject to compliance with
the applicable provisions of this Warrant as to any transfer which may be involved in such division or combination, the Company shall
execute and deliver a new Warrant or Warrants in exchange for the Warrant or Warrants to be divided or combined in accordance with such
notice.


 


3.4 Expenses.
The Company shall prepare, issue and deliver at its own expense any new Warrant or Warrants required to be issued hereunder.


 


3.5 Maintenance
of Books. The Company agrees to maintain, at the Designated Office, books for the registration and transfer of the Warrants.


 




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3.6 Registration
of Warrant Stock. Any issuance of shares of Common Stock pursuant to Section 2.1 of this Warrant (collectively, the “Issuances”)
shall be made pursuant to (i) an effective Registration Statement on Form S-3, No. 257159, including all amendments thereto, the exhibits
and any schedules thereto, the documents otherwise deemed to be a part thereof or included therein or any immediately succeeding registration
statement that is filed under the Securities Act on Form S-3 and immediately becomes effective (the “Registration Statement”)
filed by the Company with the Commission in conformity with the Securities Act under the Rules and Regulations of the Commission, including
the prospectus contained therein (the “Base Prospectus”) and (ii) a final prospectus supplement filed with the Commission
and delivered to the Holder (a “Prospectus Supplement” and, together with the Base Prospectus, a “Prospectus”)
containing amended and/or certain supplemental information regarding the Common Stock and terms of the Issuances. If the Company has filed
one or more abbreviated registration statements to register additional shares of Common Stock pursuant to Rule 462(b) under the Rules
and Regulations (each a “Rule 462(b) Registration Statement”), then any reference herein to the term “Registration
Statement” shall also be deemed to include any such Rule 462(b) Registration Statement.


 


(i) The
Company shall use reasonable best efforts to keep the Registration Statement effective until the earliest date as of which there are no
remaining Issuances, and if, at any time from the date hereof, the Company is not eligible to issue any Common Stock or Warrants pursuant
to the Registration Statement, the Company shall use reasonable best efforts to file and make effective a replacement Registration Statement
as soon as practicable. If the Registration Statement has been outstanding for at least three (3) years, at the end of the third year,
the Company shall file a new Registration Statement covering Issuances, and if at any time when the Company is required to re-evaluate
its eligibility to use Form S-3, the Company determines that it is not eligible to use Form S-3, the Company shall use its reasonable
best efforts to refile the Registration Statement on Form S-1 if such form is available (or on such other form as may be available if
Form S-1 is not available), and keep such registration statement effective during the period during which such registration statement
is required to be otherwise kept effective under this Section 3.6(i).


 


(ii) For
the avoidance of doubt, the Company acknowledges and agrees that no Issuances shall be made pursuant to any prospectus or prospectus supplement
other than a Prospectus or any replacement Registration Statement required by this Section 3.6. The Company represents and warrants that,
as of the Effective Date, the Securities Act and Rules and Regulations permit the Company to offer and issue $205,000,000 worth of shares
of Common Stock and other securities listed in the Registration Statement pursuant to the Registration Statement, of which as of July
1, 2021, approximately $147,500,000 remains available. The Company represents and warrants that the Registration Statement complied when
it became effective, complies on the Effective Date and shall comply on the Original Issue Date and on each Exercise Date and any later
date upon which shares of Common Stock are received pursuant to this Agreement or a Warrant, in each case, in all material respects with
the requirements of Form S-3 under the Securities Act. The Company represents and warrants that no order preventing or suspending the
use of the Prospectus has been issued by the Commission, and no stop order suspending the effectiveness of the Registration Statement
or any post-effective amendment thereto has been issued, and no proceedings for that purpose have been instituted or, to the Company’s
knowledge, are threatened by the Commission. The Company represents and warrants that neither the Registration Statement nor the Prospectus
shall, as of the Effective Date, the Original Issue Date or any Exercise Date or any later date on which shares of Common Stock are issued
to the Holder under the Prospectus, contain any untrue statement of a material fact or omit to state a material fact required to be stated
therein or necessary to make the statements therein not misleading.


 




    9


     


    

 


(iii) The
Company shall as soon as practicable notify the Holder of (A) the issuance by the Commission of any stop order suspending the effectiveness
of any registration statement or the initiation of any proceedings for that purpose, (B) the receipt by the Company or its counsel of
any notification with respect to the suspension of the qualification of shares of Common Stock or Warrants for sale in any jurisdiction
or the initiation or threatening of any proceeding for such purpose, and (C) the effectiveness of each registration statement filed hereunder.


 


(iv) The
Company shall use reasonable best efforts to cause the Warrant Stock when issued to be listed or quoted on each Trading Market on which
the Common Stock is then listed or quoted.


 


(v) The
Company shall use its reasonable best efforts to timely file its SEC Reports (or, if the Company is not required to file such reports,
it will, upon the request of the Holder, make publicly available such information as necessary to permit sales pursuant to Rule 144 under
the Securities Act), and the Company shall use reasonable best efforts to take such further action as the Holder may reasonably request,
in each case to the extent required from time to time to enable the Holder to, if permitted by the terms of an applicable Warrant, sell
such Warrant or its underlying Warrant Stock without registration under the Securities Act within the limitation of the exemptions provided
by (A) Rule 144 under the Securities Act, as such rule may be amended from time to time, or (B) any successor rule or regulation hereafter
adopted by the Commission. Upon the written request of the Holder, the Company shall deliver to the Holder a written statement that it
has complied with such requirements.


 


		4.	ANTIDILUTION PROVISIONS



 


The number of shares of Warrant
Stock for which this Warrant is exercisable and the Exercise Price shall be subject to adjustment from time to time as set forth in this
Article 4.


 


4.1 Upon
Issuance of Common Stock. If the Company shall, at any time or from time to time after the Original Issue Date, issue any shares of
Common Stock, options to purchase or rights to subscribe for Common Stock, securities by their terms convertible into or exchangeable
for Common Stock, or options to purchase or rights to subscribe for such convertible or exchangeable securities without consideration
or for consideration per share less than the greater of (x) the Exercise Price in effect immediately prior to the issuance of such Common
Stock or securities and (y) the Fair Market Value per share of the Common Stock immediately prior to such issuance (the greater of (x)
and (y), the “Reference Price”), then such Exercise Price shall forthwith be lowered to a price equal to the price
obtained by multiplying:


 


(i) the
Exercise Price in effect immediately prior to the issuance of such Common Stock, options, rights or securities by


 


(ii) a
fraction of which (x) the numerator shall be the sum of (i) the number of shares of Common Stock Outstanding immediately prior to such
issuance and (ii) the number of additional shares of Common Stock which the aggregate consideration for the number of shares of Common
Stock so offered would purchase at the Reference Price and (y) the denominator shall be the number of shares of Common Stock Outstanding
immediately after such issuance.


 




    10


     


    

 


4.2 Upon
Acquisition of Common Stock. If the Company or any Subsidiary shall, at any time or from time to time after the Original Issue Date,
directly or indirectly, redeem, purchase or otherwise acquire any shares of Common Stock, options to purchase or rights to subscribe for
Common Stock, securities by their terms convertible into or exchangeable for Common Stock, or options to purchase or rights to subscribe
for such convertible or exchangeable securities, for a consideration per share (plus, in the case of such options, rights, or securities,
the additional consideration required to be paid to the Company upon exercise, conversion or exchange) greater than the Fair Market Value
per share of Common Stock immediately prior to the earlier of (x) the announcement of such event or (y) such event, then the Exercise
Price shall forthwith be lowered to a price equal to the price obtained by multiplying:


 


(i) the
Exercise Price in effect immediately prior to such event by


 


(ii) a
fraction:


 


		(A)	the numerator of which is (1) the product of (a) the number of shares of Common Stock Outstanding and
(b) the Fair Market Value per share of Common Stock, in each case immediately prior to such event, minus (2) the aggregate consideration
paid by the Company in such event (plus, in the case of such options, rights, or convertible or exchangeable securities, the aggregate
additional consideration required to be paid to the Company upon exercise, conversion or exchange), and



 


		(B)	the denominator of which is the product of (1) the number of shares of Common Stock Outstanding immediately
after such event and (2) the Fair Market Value per share of Common Stock immediately prior to such event.



 


4.3 Provisions
Applicable to Adjustments. For the purposes of any adjustment of the Exercise Price pursuant to Section 4.1 or 4.2 hereof, the following
provisions shall be applicable:


 


(i) In
the case of the issuance of Common Stock, options to purchase or rights to subscribe for Common Stock, securities by their terms convertible
into or exchangeable for Common Stock, or options to purchase or rights to subscribe for such convertible or exchangeable securities for
a consideration in whole or in part other than cash, the consideration other than cash shall be deemed to be the Fair Market Value of
the non-cash consideration.


 




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(ii) In
the case of the issuance of options to purchase or rights to subscribe for Common Stock, securities by their terms convertible into or
exchangeable for Common Stock, or options to purchase or rights to subscribe for such convertible or exchangeable securities:


 


		(A)	the aggregate maximum number of shares of Common Stock that potentially may be deliverable upon exercise
of such options to purchase or rights to subscribe for Common Stock at any time during the term thereof shall be deemed to have been issued
at the time such options or rights were issued and for a consideration equal to the consideration (determined in the manner provided in
subparagraph (i) above), if any, received by the Company upon the issuance of such options or rights plus the minimum purchase price provided
in such options or rights for the Common Stock covered thereby;



 


		(B)	the aggregate maximum number of shares of Common Stock that potentially may be deliverable upon conversion
of or in exchange for any such convertible or exchangeable securities or upon the exercise of options to purchase or rights to subscribe
for such convertible or exchangeable securities and subsequent conversion or exchange thereof at any time during the term thereof shall
be deemed to have been issued at the time such securities, options, or rights were issued and for a consideration equal to the consideration
received by the Company for any such securities and related options or rights (excluding any cash received on account of accrued interest
or accrued dividends), plus the additional consideration, if any, to be received by the Company upon the conversion or exchange of such
securities or the exercise of any related options or rights (the consideration in each case to be determined in the manner provided in
paragraph (i) above);



 


		(C)	on any increase in the number of shares or decrease in the effective exercise or conversion price of Common
Stock deliverable upon exercise of any such options, rights or securities or conversions of or exchanges of such securities, including
any change resulting from the anti-dilution provisions thereof, the Exercise Price shall forthwith be readjusted to such Exercise Price
as would have been obtained had the adjustment made upon the issuance of such options, rights or securities not converted prior to such
change or options or rights related to such securities not converted prior to such change been made upon the basis of such change; and



 


		(D)	no further adjustment of the Exercise Price adjusted upon the issuance of any such options, rights, convertible
securities or exchangeable securities shall be made as a result of the actual issuance of Common Stock on the exercise of any such rights
or options or any conversion or exchange of any such securities.



 




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4.4 Upon
Stock Dividends, Subdivisions or Splits. If, at any time after the Original Issue Date, the number of shares of Common Stock Outstanding
is increased by a stock dividend payable in shares of Common Stock or by a subdivision or split-up of shares of Common Stock, then, following
the record date for the determination of holders of Common Stock entitled to receive such stock dividend, or to be affected by such subdivision
or split-up, the Exercise Price shall be appropriately decreased by multiplying each price by a fraction, the numerator of which is the
number of shares of Common Stock Outstanding immediately prior to such increase and the denominator of which is the number of shares of
Common Stock Outstanding immediately after such increase in Outstanding shares.


 


4.5 Upon
Combinations or Reverse Stock Splits. If, at any time after the Original Issue Date, the number of shares of Common Stock Outstanding
is decreased by a combination or reverse stock split of the Outstanding shares of Common Stock into a smaller number of shares of Common
Stock, then, following the record date to determine shares affected by such combination or reverse stock split, the Exercise Price shall
be appropriately increased by multiplying each price by a fraction, the numerator of which is the number of shares of Common Stock Outstanding
immediately prior to such decrease and the denominator of which is the number of shares of Common Stock Outstanding immediately after
such decrease in Outstanding shares.


 


4.6 Upon
Reclassifications, Reorganizations, Consolidations, Mergers or Dispositions of Assets. In the event of any capital reorganization
of the Company, any reclassification of the capital stock of the Company (other than a change in par value or from par value to no par
value or from no par value to par value or as a result of a stock dividend or subdivision, stock-split, reverse stock-split or combination
of shares), any consolidation or merger of the Company with or into another Person (where the Company is not the surviving Person or where
there is a change in or distribution with respect to the Common Stock) or sale, transfer or other disposition of all or substantially
all of the Company’s property, assets or business to another Person, each Warrant shall after such reorganization, reclassification,
consolidation, merger or disposition of assets be exercisable for the kind and number of shares of stock or other securities or property
of the Company or of the successor Person (if other than the Company) resulting from such reorganization, reclassification, consolidation,
merger or disposition of assets, if any, to which the holder of the number of shares of Common Stock deliverable (immediately prior to
the time of such reorganization, reclassification, consolidation, merger or disposition of assets) upon exercise of such Warrant would
have been entitled upon such reorganization, reclassification, consolidation, merger or disposition of assets (without taking into account
any limitations or restrictions on the exercisability of this Warrant); and, in such case, appropriate adjustment (in form and substance
satisfactory to the Holder) shall be made with respect to the Holder’s rights under this Warrant to insure that the provisions of
Article 4 hereof shall thereafter be applicable, as nearly as possible, to this Warrant in relation to any shares of stock, securities
or assets thereafter acquirable upon exercise of this Warrant. The Company shall not effect any such reorganization, reclassification,
consolidation, merger or disposition of assets unless, prior to the consummation thereof, the successor Person (if other than the Company)
resulting from such reorganization, reclassification, consolidation, merger or disposition of assets, shall assume, by written instrument,
(i) the obligation to deliver to the Holders of the Warrant such shares of stock, securities or assets, which, in accordance with the
foregoing provisions of this Section 4.6, the Holders shall be entitled to receive upon such conversion and (ii) the obligations of the
Company pursuant to the provisions of Section 3.6. The provisions of this Section 4.6 shall similarly apply to successive reorganizations,
reclassifications, consolidations, mergers or dispositions of assets.


 




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4.7 Other
Anti-Dilution Provisions. If the Company has issued or issues any securities of the Company to a financial institution, lender, other
credit provider, leasing company or other lessor in connection with the provisions of any financing or lending agreements, containing
provisions (including, without limitation, anti-dilution and registration rights) which are more favorable than those set forth herein,
the Company will make such provisions (or any more favorable portion thereof) available to the Holder and will enter into amendments necessary
to confer such rights on the Holder. Notwithstanding the foregoing, any adjustment to the Exercise Price or number of shares of Warrant
Stock shall be made only pursuant to and in accordance with Article 4 of this Warrant.


 


4.8 Appraisal
Procedure. In any case in which the provisions of this Article 4 shall necessitate that the Appraisal Procedure be utilized for purposes
of determining an adjustment to the Exercise Price, the Company may defer, until the completion of the Appraisal Procedure and the determination
of the adjustment, (i) issuing to the Holder of any Warrant exercised after the date of the event that requires the adjustment and before
completion of the Appraisal Procedure and the determination of the adjustment, the shares of capital stock issuable upon such exercise
by reason of the adjustment required by such event and issuing to the Holder only the shares of capital stock issuable upon such exercise
before giving effect to such adjustment and (ii) paying to the Holder any amount in cash in lieu of a fractional share of capital stock
pursuant to Section 2.3 above; provided, however, that the Company shall deliver to the Holder an appropriate instrument
or due bills evidencing the Holder’s right to receive such additional shares or such cash.


 


4.9 Adjustment
of Number of Shares Purchasable. Upon any adjustment of the Exercise Price as provided in Section 4.1, 4.2, 4.4, 4.5 and 4.6, the
Holders of the Warrants shall thereafter be entitled to purchase upon the exercise thereof, at the Exercise Price resulting from such
adjustment, the number of shares of Warrant Stock (calculated to the nearest 1/100th of a share) obtained by multiplying the Exercise
Price in effect immediately prior to such adjustment by the number of shares of Warrant Stock issuable on the exercise hereof immediately
prior to such adjustment and dividing the product thereof by the Exercise Price resulting from such adjustment.


 


4.10 Increase
of Number of Shares Purchasable. After giving effect to all other provisions in this Article 4 other than this Section 4.10, the number
of shares of Warrant Stock purchasable upon exercise of this Warrant shall be increased when the Exercise Price is adjusted to an amount
below the then-existing par value of the Warrant Stock, including successive adjustments to the Exercise Price to an amount further below
the then-existing par value. The number of additional shares purchasable upon exercise of this Warrant shall be equal to the number obtained
by dividing:


 


(i) The
product of (A) the number of shares purchasable upon exercise of the Warrant before application of this Section 4.10 and (B) the difference
between the then-existing par value per share of Warrant Stock minus the adjusted Exercise Price, by


 


(ii) The
difference between the Fair Market Value of the Common Stock on the Exercise Date minus the then-existing par value per share of Warrant
Stock.


 




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Concurrently with the foregoing adjustment to
the number of additional shares purchasable upon exercise of this Warrant, the Exercise Price shall be adjusted to be the then-existing
par value of the Warrant Stock.


 


4.11 Form
of Warrants. Irrespective of any adjustments of the number of shares of Warrant Stock purchasable or of the Exercise Price, the Warrant
theretofore or thereafter issued may continue to express the same price and number and kind of shares as are stated in the Warrant issued
on the Original Issue Date.


 


4.12 Changes
in Securities. Notwithstanding any provision in this Article 4 to the contrary and without limitation to any other provision contained
in this Article 4, in the event any securities of the Company are amended, modified or otherwise altered by operation of this Article
4’s terms or otherwise in any manner whatsoever (including through the anti-dilution provisions thereof) that results in (i) the
reduction of the effective exercise, conversion or exchange price of such securities payable upon the exercise for, or conversion or exchange
into, Common Stock or other securities exercisable for, or convertible or exchangeable into, Common Stock and/or (ii) such securities
becoming exercisable for, or convertible or exchangeable into (A) more shares or dollar amount of such securities which are, in turn exercisable
for, or convertible or exchangeable into, Common Stock, or (B) more shares of Common Stock, then such amendment, modification or other
alteration shall be treated for purposes of Article 4 as if the securities which have been amended, modified or altered have been terminated
and new securities have been issued with the amended or modified terms. The Company shall make all necessary adjustments (including successive
adjustments if required) to the Exercise Price in accordance with this Article 4, but in no event shall the Exercise Price be greater
than it was immediately prior to the application of this Section 4.12 to the amendment, modification or alteration in question.


 


4.13 Maximum
Exercise Price. Except as provided in Section 4.5 above, at no time shall the Exercise Price per share of Warrant Stock exceed the
amount set forth in the preamble of this Warrant.


 


4.14 Exceptions.
Notwithstanding anything to the contrary, Article 4 hereof shall not apply to (i) (A) the issuance and exercise of options to purchase
shares of Common Stock and (B) the issuance of shares of Common Stock, in each case of the foregoing clause (A) and (B), as made to eligible
recipients pursuant to any equity incentive plan duly adopted by the board of directors of the Company in the ordinary course of business,
or (ii) any issuance of shares of Common Stock upon conversion of the Company’s convertible debt securities outstanding as of the
Effective Date.


 


4.15 Notice
of Adjustment of Exercise Price. Whenever the number of shares of Common Stock for which this Warrant is exercisable or the Exercise
Price is adjusted as provided under Article 4 hereof:


 


(i) the
Company shall compute the adjusted Exercise Price in accordance with this Article 4 and shall prepare a certificate signed by the treasurer
or chief financial officer of the Company setting forth the adjusted Exercise Price and showing in reasonable detail the facts upon which
such adjustment is based, and such certificate shall forthwith be filed at the Designated Office; and


 




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(ii) a
notice stating that the Exercise Price has been adjusted and setting forth the adjusted Exercise Price shall forthwith be prepared by
the Company, and as soon as practicable after it is prepared, such notice shall be mailed by the Company at its expense to the Holder
at its last address as it shall appear in the warrant register. If the Board of Directors of the Company makes any determination of Fair
Market Value for purposes of determining such proposed adjustment, then, within thirty (30) days of the Holder’s receipt of such
notice, the Holder shall have the right to use the Appraisal Procedure to determine Fair Market Value with respect to the entire proposed
adjustment.


 


4.16 Independent
Application. Except as otherwise provided herein, all sections of this Article 4 are intended to operate independently of one another
(but without duplication). If an event occurs that requires the application of more than one section of this Article 4, all applicable
sections shall be given independent effect without duplication.


 


		5.	BENEFICIAL OWNERSHIP LIMITS; ISSUANCE CAP



 


5.1 Beneficial
Ownership Limitation.


 


(a) Notwithstanding
anything to the contrary contained herein, the Holder shall not receive shares of Warrant Stock upon exercise of the Warrant to the extent
(but only to the extent) that such exercise or receipt would cause the Holder Group to become, directly or indirectly, a beneficial owner
of a number of shares of Common Stock that exceeds the Maximum Percentage of Common Stock Outstanding as of the Exercise Date (the “Beneficial
Ownership Limitation“). The Beneficial Ownership Limitation (i) may be increased or decreased, in the Holder’s
sole discretion, upon 61 days’ written notice to the Company by the Holder, provided, however, that in no event shall
the Holder increase such Beneficial Ownership Limitation to raise the Maximum Percentage in excess of 19.99% as of any date of shares
of Common Stock Outstanding from the date hereof through the Expiration Date and (ii) shall automatically be increased to a Maximum Percentage
of 19.99% on the date that is 15 days prior to the Expiration Date.


 


(b) At
the time of delivery of any Exercise Notice, the Holder shall notify the Company if, and only if, a Holder Group would beneficially own
a number of shares of Common Stock in excess of the Beneficial Ownership Limitation upon giving effect to such Exercise Notice. For the
avoidance of doubt, upon any failure by the Holder to deliver such notice, any subsequent purported delivery in such instance of Warrant
Stock shall be void and have no effect pursuant to Section 5.1(c) hereof.


 




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(c) Any
purported delivery of Warrant Stock pursuant to Section 2.1(b) hereof, and any purported payment by the Holder of the Warrant Price pursuant
to Section 2.1(a) and 2.1(c) hereof, in connection with the exercise of the Warrant shall be void and have no effect to the extent (but
only to the extent) that such delivery would violate the Beneficial Ownership Limitation. If any delivery of Warrant Stock owed to the
Holder following exercise of the Warrant is not made, in whole or in part, as a result of the Beneficial Ownership Limitation, the Company’s
obligation to make such delivery shall not be extinguished and the Company shall deliver such Warrant Stock as promptly as practicable
after the Holder gives written notice to the Company that such delivery would not violate the Beneficial Ownership Limitation (the “Delivery
Notice”), provided, however, that (i) the Holder shall be deemed to have exercised this Warrant in respect of
any such delayed Warrant Stock (other than at the Expiration Date) as of the date of the applicable Delivery Notice and (ii) for
the avoidance of doubt, Article 4 hereof and Article 10 hereof shall remain in full force and effect for such period of delay, and provided,
further, however, that at the Expiration Date and in accordance with the deemed Exercise Notice under Section 2.1(a) hereof,
if, without giving effect to the Beneficial Ownership Limitation, the Warrant would be exercisable for any Warrant Stock, (i) the Holder
shall be entitled to receive from the Company any such remaining Warrant Stock under the terms of this Warrant until such time as the
Beneficial Ownership Limitation would not prohibit such delivery (such Warrant Stock at the Expiration Date, the “Expiration
Warrant Stock”), (ii) the Holder shall be deemed to have exercised this Warrant in respect of all such Expiration Warrant Stock
as of the date of the Holder’s receipt from the Company of the Expiration Warrant Stock (which exercise shall be subject to Article
4 hereof but not be subject to Sections 4.1 through 4.3 hereof) and (iii) for the avoidance of doubt, Article 10 hereof shall remain
in full force and effect for the period until the delivery of the Expiration Warrant Stock.


 


(d) For
purposes of this Section 5.1, (i) the term “Maximum Percentage“ shall mean
4.99%; provided, however, that if at any time after the date hereof the Holder Group beneficially owns in excess of 4.99%
of the Outstanding Common Stock (excluding any Common Stock that could be acquired by exercise of this Warrant), then the Maximum Percentage
shall automatically increase to 9.99% so long as any Holder Group owns in excess of 4.99% of such Common Stock (and shall, for the avoidance
of doubt, automatically decrease to 4.99% upon the time when no Holder Group beneficially owns in excess of 4.99% of such Outstanding
Common Stock); and (ii) the term “Holder Group“ shall mean any group in respect
of Common Stock, where “group” has the meaning established under Section 13(d) of the Exchange Act and the rules promulgated
thereunder, if the Holder or any other Person having beneficial ownership of Common Stock beneficially owned by the Holder is a member
of such group. In determining the number of shares of Common Stock Outstanding for purposes of this Section 5.1 and the number of shares
that the Holder may at any time acquire pursuant to the Beneficial Ownership Limitation and the other terms of this Section 5.1, the Holder
shall give effect to the last sentence of Rule 13d-3(d)(1)(i) as promulgated under the Exchange Act, and 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 or Quarterly Report
on Form 10-Q filed with the Commission, as the case may be, (y) a more recent public announcement by the Company or (z) a more recent
notice by the Company or its transfer agent to the Holder setting forth the number of shares of Common Stock then outstanding. Upon written
or oral request of the Holder, the Company shall, within two (2) Business Days of such request, confirm orally and in writing to the Holder
the number of shares of Common Stock then Outstanding. The provisions of this Section 5.1 shall be construed, corrected and implemented
in a manner so as to effectuate the intended Beneficial Ownership Limitation.


 




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5.2 Issuance
Cap. Unless Stockholder Approval has been previously obtained, in the event that any issuance of Warrant Stock upon the exercise of
this Warrant would, together with any other issuance of shares of Common Stock by the Company to any holder of any Warrant that would
be aggregated with such proposed issuance under this Warrant for determining whether such issuances collectively would require approval
by a vote of Company stockholders under the applicable listing rules of the Nasdaq Global Market, any successor stock exchange operated
by the NASDAQ Stock Market LLC or any successor thereto (such other issuances the “Related
Issuances“), exceed 19.99% of the Common Stock Outstanding on January 2, 2021 (the “Aggregation Date”),
the Holder shall receive only a number of shares of Common Stock, rounded down to the nearest whole number, equal to (A) the maximum
number of shares of Common Stock which could be issued to the Holder and any other recipients of any then-proposed Related Issuances in
the aggregate without the Related Issuances exceeding 19.99% of the Common Stock Outstanding on the Aggregation Date multiplied by a ratio
equal to (B) (1) the number of shares of Common Stock that would be otherwise received by the Holder under this Warrant divided by
(2) the number of all of the shares of Common Stock that would be otherwise received by the Holder under this Warrant and the recipients
of any then-proposed Related Issuances in the aggregate. To the extent the Holder is entitled to receive from the Company a number of
shares of Warrant Stock reduced by this Section 5.2, the Company shall pay to the Holder, in satisfaction of the Company’s obligation
to deliver such Warrant Stock, a cash amount equivalent to the Fair Market Value, determined as of the Exercise Date, of the number of
shares of Warrant Stock by which such exercise was reduced within three (3) Business Days of the Exercise Date.


 


		6.	NO IMPAIRMENT; REGULATORY COMPLIANCE AND COOPERATION



 


6.1 No
Impairment. The Company shall not by any action, including, without limitation, amending its charter documents or through any reorganization,
reclassification, transfer of assets, consolidation, merger, dissolution, issue or sale of securities or any other similar voluntary action,
avoid or seek to avoid the observance or performance of any of the terms of this Warrant, but will at all times in good faith assist in
the carrying out of all such terms and in the taking of all such actions as may be necessary or appropriate to protect the rights of the
Holder against impairment. Without limiting the generality of the foregoing, the Company shall take all such action as may be necessary
or appropriate in order that the Company may validly and legally issue fully paid and nonassessable shares of Warrant Stock upon the exercise
of this Warrant, free and clear of all Liens, and shall use its best efforts to obtain all such authorizations, exemptions or consents
from any public regulatory body having jurisdiction thereof as may be necessary to enable the Company to perform its obligations under
this Warrant. The Company shall not take any action, enter into any transaction or suffer to exist any event, action or state of facts
that would cause the Exercise Price to be adjusted below the then existing par value of Common Stock (unless the Common Stock is changed
to capital stock with no par value); provided, however, that nothing herein will prevent the operation of any other provision
of this Warrant, including the anti-dilution provisions of Article 4 hereof.


 


6.2 No
Dilution. If any event shall occur as to which the provisions of Article 4 hereof are not strictly applicable but the failure to make
any adjustment would adversely affect the purchase rights represented by the Warrant in accordance with the essential intent and principles
of such Article (including, without limitation, the issuance of securities other than Common Stock which have the right to participate
in distributions to the holders of Common Stock, the granting of “phantom stock” rights or “stock appreciation rights”),
then, in each such case, the Company shall, upon the request of any Holder, appoint an investment banking firm of recognized national
standing, or any other financial expert that does not (or whose directors, officers, employees, Affiliates or stockholders do not) have
a direct or material indirect financial interest in the Company or any of its Subsidiaries, who has not been, and, at the time it is called
upon to give independent financial advice to the Company, is not (and none of its directors, officers, employees, Affiliates or stockholders
are) a promoter, director or officer of the Company or any of its Subsidiaries, which shall give their opinion upon the adjustment, if
any, on a basis consistent with the essential intent and principles established in Article 4 hereof, necessary to preserve, without dilution,
the purchase rights, represented by this Warrant. Prior to such determination by such investment banking firm, the Company and the requesting
Holder(s), respectively, shall specify the amount, if any, of the adjustment that such party has determined in good faith to be appropriate.
The adjustment determined by the investment banking firm shall be within the range of the adjustments thus proposed by the parties, and
the costs and fees of such investment banking firm shall be allocated proportionately between the Company, on one hand, and the Holder,
on the other, based on the respective differences between the amount of the adjustment as determined by such investment banking firm and
the amounts of such adjustment proposed by the Company and the Holder. Upon receipt of such opinion, the Company will promptly mail a
copy thereof to the holders of the Warrants and shall make the adjustments described therein.


 




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6.3 Other
Agreements. The Company is not a party to or bound in any manner under, and covenants that it will not enter into at any time after
the date hereof, any agreement or contract (whether written or oral) with respect to any of its securities which prevents the Company
from complying in any respect with the rights granted by the Company hereunder.


 


6.4 Antitrust
Notification. If the Holder determines, in its sole judgment upon the advice of counsel, that an exercise of this Warrant pursuant
to the terms hereof would be subject to the provisions of the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended (the “HSR
Act”), the Company shall file, within seven (7) Business Days after receiving notice from the Holder of the applicability of
the HSR Act and a request to so file, with the United States Federal Trade Commission (the “FTC”) and the United States
Department of Justice (the “DOJ”) the notification and report form and any supplemental information required to be
filed by it pursuant to the HSR Act in connection with the exercise of this Warrant. Any such notification and report form and supplemental
information will be in full compliance with the requirements of the HSR Act. The Company will furnish to the Holder promptly (but in no
event more than five (5) business days) such information and assistance as such holder may reasonably request in connection with the preparation
of any filing or submission required to be filed by the Holder under the HSR Act. The Company shall respond promptly after receiving any
inquiries or requests for additional information from the FTC or the DOJ (and in no event more than three (3) business days after receipt
of such inquiry or request). The Company shall keep the Holder apprised periodically and at the Holder's request of the status of any
communications with, and any inquiries or requests for additional information from, the FTC or the DOJ. The Company shall bear all filing
or other fees required to be paid by the Company under the HSR Act or any other applicable law in connection with such filings and all
costs and expenses (including, without limitation, reasonable attorneys' fees and expenses) incurred by the Company in connection with
the preparation of such filings and responses to inquiries or requests. The Company shall also bear 50% of all filing or other fees required
to be paid by the Holder (or the “ultimate parent entity” of the Holder, if any) under the HSR Act or any other applicable
law in connection with such filings and 50% of all costs and expenses (including, without limitation, reasonable attorneys' fees and expenses)
incurred by the Holder in connection with the preparation of such filings and responses to inquiries or requests, and the Holder shall
bear the remaining 50% of such fees, costs and expenses. In the event that this Section 6.4 is applicable to any exercise of this Warrant,
the issuance to the Holder of the applicable Warrant Stock, and the payment by the Holder of the Warrant Price therefor, shall be subject
to the expiration or earlier termination of the waiting period under the HSR Act (with the Exercise Date being deemed to be the date immediately
following the date of such expiration or early termination).


 




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		7.	RESERVATION AND AUTHORIZATION OF COMMON STOCK



 


7.1 Reservation.
The Company shall at all times reserve and keep available for issuance upon the exercise of the Warrant such number of its authorized
but unissued shares of Common Stock as will be required for issuance of the Warrant Stock. All shares of Warrant Stock issuable pursuant
to the terms hereof, when issued upon exercise of this Warrant with payment therefor in accordance with the terms hereof, shall be duly
and validly issued and fully paid and nonassessable, not subject to preemptive rights and shall be free and clear of all Liens. Before
taking any action that would result in an adjustment in the number of shares of Warrant Stock for which this Warrant is exercisable or
in the Exercise Price, the Company shall obtain all such authorizations or exemptions thereof, or consents thereto, as may be necessary
from any public regulatory body or bodies having jurisdiction over such action. If any shares of Warrant Stock required to be reserved
for issuance upon exercise of the Warrant require registration or qualification with any Governmental Authority under any federal or state
law (including the Securities Act and state securities laws) before such shares may be so issued, the Company will use its commercially
reasonable efforts to register and qualify such shares as soon as practicable and at its expense.


 


7.2 Corporate
Action. Before taking any action that would cause an adjustment reducing the Exercise Price below the then-par value (if any) of the
shares of Warrant Stock deliverable upon exercise of the Warrant or that would cause the number of shares of Warrant Stock issuable upon
exercise of the Warrant to exceed (when taken together with all other Outstanding shares of Common Stock) the number of shares of Common
Stock that the Company is authorized to issue, the Company will take any corporate action that, in the opinion of its counsel, is necessary
in order that the Company may validly and legally issue the full number of fully paid and nonassessable shares of Warrant Stock issuable
upon exercise of the Warrant at such adjusted exercise price.


 


		8.	NOTICE OF CORPORATE ACTIONS; TAKING OF RECORD; TRANSFER BOOKS



 


8.1 Notices
of Corporate Actions.


 


In case:


 


(a) the
Company shall grant to the holders of its Common Stock rights or warrants to subscribe for or purchase any shares of capital stock of
any class; or


 


(b) the
Company shall declare to the holders of its Common Stock any dividend or distribution; or


 


(c) of
any reclassification of the Common Stock (other than a subdivision or combination of the Outstanding shares of Common Stock), or of any
consolidation, merger or share exchange to which the Company is a party and for which approval of any stockholders of the Company is required,
or of the sale or transfer of all or substantially all of the assets of the Company; or


 




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(d) of
the voluntary or involuntary dissolution, liquidation or winding up of the Company;


 


(e) the
Company or any Subsidiary shall commence a tender offer for all or a portion of the Outstanding shares of Common Stock (or shall amend
any such tender offer to change the maximum number of shares being sought or the amount or type of consideration being offered therefor);
or


 


(f) the
Company or any Subsidiary takes any action or any event or circumstance occurs that impacts the rights of a Holder set forth herein or
in the Credit Agreement, as applicable;


 


then the Company shall cause to be filed at the
Designated Office, and shall cause to be mailed to the Holder at its last address as it shall appear in the warrant register, at least
30 days prior to the applicable record, effective or expiration date hereinafter specified, a notice stating (x) the date on which a record
is to be taken for the purpose of such dividend, distribution or granting of rights or warrants, or, if a record is not to be taken, the
date as of which the holders of Common Stock of record who will be entitled to such dividend, distribution, rights or warrants are to
be determined, (y) the date on which such reclassification, consolidation, merger, share exchange, sale, transfer, dissolution, liquidation
or winding up is expected to become effective, and the date as of which it is expected that holders of Common Stock of record shall be
entitled to exchange their shares of Common Stock for securities, cash or other property deliverable upon such reclassification, consolidation,
merger, share exchange, sale, transfer, dissolution, liquidation or winding up, or (z) the date on which such tender offer commenced,
the date on which such tender offer is scheduled to expire unless extended, the consideration offered and the other material terms thereof
(or the material terms of the amendment thereto). Such notice shall also set forth such facts with respect thereto as shall be reasonably
necessary to indicate the effect of such action on the Exercise Price and the number and kind or class of shares or other securities or
property which shall be deliverable or purchasable upon the occurrence of such action or deliverable upon exercise of the Warrants. Neither
the failure to give any such notice nor any defect therein shall affect the legality or validity of any action described in clauses (a)
through (e) of this Section 8.1.


 


8.2 Taking
of Record. In the case of all dividends or other distributions by the Company to the holders of its Common Stock with respect to which
any provision hereof refers to the taking of a record of such holders, the Company will in each such case take such a record and will
take such record as of the close of business on a Business Day.


 


8.3 Closing
of Transfer Books. The Company shall not at any time close its stock transfer books or warrant transfer books so as to result in preventing
or delaying the exercise or transfer of any Warrant.


 




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		9.	OFFICE OF THE COMPANY



 


9.1 As
long as the Warrant remains outstanding, the Company shall maintain an office or agency, which may be the principal executive offices
of the Company (the “Designated Office“), where the Warrant may be presented
for exercise, registration of transfer, division or combination as provided in this Warrant. Such Designated Office shall initially be
the office of the Company at 550 South Hope Street, Suite 2850, Los Angeles, California 90071. The Company may from time to time change
the Designated Office to another office of the Company or its agent within the United States by notice given to any registered Holders
at least ten (10) Business Days prior to the effective date of such change.


 


		10.	DILUTION ADJUSTMENT



 


10.1 Dilution
Adjustment.


 


(a) In
the event that any dividends are declared or paid or any other distribution is made on or with respect to the Common Stock, the Holder
as of the record date established by the Board of Directors of the Company for such dividend or distribution on the Common Stock shall
be entitled to receive a fee (the “Dilution Adjustment”) in an amount (whether in the form of cash, securities or other property)
equal to the amount (and in the form) of the dividends or distribution that such Holder would have received had the Warrant been exercised
as of the date immediately prior to the record date for such dividend or distribution, such Dilution Adjustment to be payable on the same
payment date established by the Board of Directors of the Company for the payment of such dividend or distribution; provided, however,
that if the Company declares and pays a dividend or distribution on the Common Stock consisting in whole or in part of Common Stock, then
no such Dilution Adjustment shall be payable in respect of the Warrant on account of the portion of such dividend or distribution on the
Common Stock payable in Common Stock and in lieu thereof the applicable adjustment in Article 4 hereof shall apply. The record date for
any such Dilution Adjustment shall be the record date for the applicable dividend or distribution on the Common Stock, and any such Dilution
Adjustment shall be payable to the Persons in whose name the Warrant is registered at the close of business on the applicable record date.


 


(b) No
dividend shall be paid or declared on any share of Common Stock (other than dividends payable in Common Stock for which an adjustment
was made pursuant to Article 4 hereof), unless the Dilution Adjustment, payable in the same consideration and manner, is simultaneously
paid or provided for, as the case may be, in respect of this Warrant in an amount determined as set forth in this Section 10.1. For purposes
of this Warrant, the term “dividends” shall include any pro rata distribution by the Company, out of funds of the Company
legally available therefor, of cash, property, securities (including, but not limited to, rights, warrants or options and/or securities
in connection with a spin-off of the Company) or other property or assets to the holders of the Common Stock, whether or not paid out
of capital, surplus or earnings other than liquidation.


 


(c) Prior
to declaring any dividend or making any distribution on or with respect to shares of Common Stock, the Company shall take all prior corporate
action necessary to authorize the issuance of any securities payable as the Dilution Adjustment in respect of the Warrant.


 




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		11.	MISCELLANEOUS



 


11.1 No
Implied Waivers. No failure or delay by any party in exercising any right, power or privilege hereunder shall operate as a waiver
thereof nor shall any single or partial exercise thereof preclude any other or further exercise thereof or the exercise of any other right,
power or privilege. The rights and remedies herein provided shall be cumulative and not exclusive of any rights or remedies provided by
law.


 


11.2 Notices.
All notices, requests, consents and other communications required or permitted hereunder shall be in writing and shall be hand delivered
or mailed postage prepaid by registered or certified mail or transmitted by facsimile transmission (with immediate telephonic confirmation
thereafter) or transmitted by email:


 


		(a)	If to the Holder:



 


B. Riley Principal Investments, LLC

11100 Santa Monica Blvd., Suite 800

Los Angeles, CA 90025

Attention: Daniel R. Palmadesso

Telephone: (646) 885-5548

E-mail: dpalmadesso@brileyfin.com


 


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


 


Morgan, Lewis & Bockius LLP

1400 Page Mill Road


Palo Alto, CA 94304-1124

Attention: Albert Lung and David Chang

Facsimile No.: (650) 843-4001

Telephone No.: (650) 843-7263

Email: albert.lung@morganlewis.com and david.chang@morganlewis.com


 


		(b)	If to the Company:



 


Cadiz Inc.

550 South Hope Street, Suite 2850

Los Angeles, California 90071

Attention: Chief Financial Officer

Facsimile No.: 213-271-1614

Email: sspeer@cadizinc.com


 


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


 


Greenberg Traurig, LLP


1840 Century Park East, Suite 1900


Los Angeles, CA 90067


Attention: Homin Lee


Telephone: (310) 586-7752


E-mail: leeho@gtlaw.com


 


or at such other address as the parties
each may specify by written notice to the others, and each such notice, request, consent and other communication shall for all purposes
of the Warrant be treated as being effective or having been given when delivered if delivered personally, upon receipt of facsimile confirmation
if transmitted by facsimile, upon transmission of email if transmitted by email, or, if sent by mail, at the earlier of its receipt or
72 hours after the same has been deposited in a regularly maintained receptacle for the deposit of United States mail, addressed and postage
prepaid as aforesaid.


 




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11.3 Indemnification.
If the Company fails to make, when due, any payments provided for in this Warrant, the Company shall pay to the Holder (a) interest at
the Applicable Rate on any amounts due and owing to such Holder and (b) such further amounts as shall be sufficient to cover any costs
and expenses including, but not limited to, reasonable attorneys’ fees and expenses incurred by such Holder in collecting any amounts
due hereunder. The Company shall indemnify, defend and hold harmless the Holder and the Holders of any Warrant Stock issued upon the exercise
of this Warrant from and against any and all liability, loss, cost, damage, reasonable attorneys’ and accountants’ fees and
expenses, court costs and all other out-of-pocket expenses incurred in connection with or arising from any default hereunder by the Company
or the enforcement of its rights hereunder as against the Company. This indemnification provision shall be in addition to the rights of
such Holder or Holders to bring an action against the Company for breach of contract based on such default hereunder.


 


11.4 Limitation
of Liability. No provision hereof, in the absence of affirmative action by the Holder to purchase shares of Warrant Stock, and no
enumeration herein of the rights or privileges of the Holder, shall give rise to any liability of such Holder to pay the Exercise Price
for any Warrant Stock other than pursuant to an exercise of this Warrant or any liability as a stockholder of the Company, whether such
liability is asserted by the Company or by creditors of the Company. The Holder shall not, by virtue hereof, be entitled to any rights
of a stockholder of the Company and nothing contained in this Warrant shall be construed as conferring upon the Holder the right to vote
or to consent or to receive notice as a stockholder in respect of meetings of stockholders for the election of directors of the Company
or any other matters or any rights whatsoever as a stockholder of the Company.


 


11.5 Remedies.
The Holder of the Warrant and/or Warrant Stock, in addition to being entitled to exercise its rights granted by law, including recovery
of damages, shall be entitled to specific performance of its rights provided under this Warrant. The Company agrees that monetary damages
would not be adequate compensation for any loss incurred by reason of a breach by it of the provisions of this Warrant and hereby agrees,
in an action for specific performance, to waive the defense that a remedy at law would be adequate.


 


11.6 Successors
and Assigns. This Warrant and the rights evidenced hereby shall inure to the benefit of and be binding upon the successors of the
Company and the permitted successors and assigns of the Holder. The provisions of this Warrant are intended to be for the benefit of all
Holders from time to time of this Warrant and to the extent applicable, all Holders of shares of Warrant Stock issued upon the exercise
hereof (including transferees), and shall be enforceable by any such Holder.


 


11.7 Amendment.
The prior written consent of the Company and the Required Holders shall be required for any change, waiver or amendment to this Warrant.
Any change, waiver or amendment so approved shall be binding upon all existing and future holders of this Warrant and any other Warrants;
provided, however, that no such change, waiver or amendment, as applied to any of the Warrants held by any particular holder
of Warrants, shall, without the written consent of that particular holder, (i) disproportionately and materially adversely affect any
rights under such particular holder’s Warrant (other than as reflected by the different number of shares of Warrant Stock issuable
to such holder); or (ii) modify any of the provisions of, or impair the right of any holder of Warrants under, this Section 11.7. This
Warrant cannot be changed, modified, discharged or terminated by oral agreement.


 




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11.8 Severability.
Wherever possible, each provision of this Warrant shall be interpreted in such manner as to be effective and valid under applicable law,
but if any provision of this Warrant shall be prohibited by or invalid under applicable law, such provision shall be ineffective to the
extent of such prohibition or invalidity, without invalidating the remainder of such provision or the remaining provisions of this Warrant.


 


11.9 Headings.
The headings and other captions in this Warrant are for the convenience and reference only and shall not be used in interpreting, construing
or enforcing any provision of this Warrant.


 


11.10 Governing
Law. IN ALL RESPECTS, INCLUDING ALL MATTERS OF CONSTRUCTION, VALIDITY AND PERFORMANCE, THIS WARRANT SHALL BE GOVERNED BY, AND CONSTRUED
AND ENFORCED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO CONFLICT OF LAW PRINCIPLES AND ANY APPLICABLE LAWS
OF THE UNITED STATES OF AMERICA.


 


11.11 Jurisdiction.
Each of the Company and the Holder hereby irrevocably and unconditionally submits for itself and its property in any legal action or proceeding
relating to this Warrant, or for recognition and enforcement of any judgment in respect thereof, to the exclusive general jurisdiction
of the courts of the Supreme Court of the State of New York sitting in New York County, the courts of the United States for the Southern
District of New York, and appellate courts from any thereof, consents that any such action or proceeding may be brought in such courts
and waives any objection that it may now or hereafter have to the venue of any such action or proceeding in any such court or that such
action or proceeding was brought in an inconvenient court and agrees not to plead or claim the same, agrees that service of process in
any such action or proceeding may be effected by delivery of notice pursuant to Section 11.2 hereof and agrees that nothing herein shall
affect the right to effect service of process in any other manner permitted by law.


 


11.12 Waiver
of Jury Trial. EACH OF THE COMPANY AND THE HOLDER WAIVES ANY RIGHT TO TRIAL BY JURY ON ANY CLAIM, DEMAND, ACTION OR CAUSE OF ACTION
(A) ARISING UNDER THIS WARRANT OR (B) IN ANY WAY CONNECTED WITH OR RELATED OR INCIDENTAL TO THIS WARRANT OR THE TRANSACTIONS RELATED HERETO,
IN EACH CASE WHETHER SOUNDING IN CONTRACT OR TORT OR OTHERWISE. EACH OF THE COMPANY AND THE HOLDER AGREES AND CONSENTS THAT ANY SUCH CLAIM,
DEMAND, ACTION OR CAUSE OF ACTION SHALL BE DECIDED BY COURT TRIAL WITHOUT A JURY, AND THAT ANY PARTY TO THIS AGREEMENT MAY FILE AN ORIGINAL
COUNTERPART OR A COPY OF THIS CLAUSE WITH ANY COURT AS WRITTEN EVIDENCE OF THE CONSENT OF THE COMPANY AND THE HOLDER TO THE WAIVER OF
THEIR RIGHT TO TRIAL BY JURY. EACH OF THE COMPANY AND THE HOLDER ACKNOWLEDGES THAT IT HAS HAD THE OPPORTUNITY TO CONSULT WITH COUNSEL
REGARDING THIS SECTION 11.12, THAT IT FULLY UNDERSTANDS ITS TERMS, CONTENT AND EFFECT, AND THAT IT VOLUNTARILY AND KNOWINGLY AGREES TO
THE TERMS OF THIS SECTION 11.12.


 




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11.13 Entire
Agreement. This Warrant contains the entire agreement with respect to the subject matter hereof and supersedes and replaces all other
prior agreements, written or oral, with respect to the subject matter hereof.


 


11.14 Originals.
A signed copy of this Warrant delivered by facsimile, e-mail or other means of electronic transmission shall be deemed to have the same
legal effect as delivery of an original copy of this Warrant.


 


[Signature Page Follows]


 




    26


     


    

 


IN WITNESS WHEREOF, the Company has caused this
Warrant to be duly executed as of the Original Issue Date.


 


	 	CADIZ INC.


 


	 	By:	/s/ Stanley Speer
	 	 	Name:	Stanley Speer
	 	 	Title:	Chief Financial Officer


 


[Signature page]


 




     


    


    

 


ANNEX A TO THE WARRANT


 


EXERCISE NOTICE


 


[To be executed only upon exercise of Warrant]


 


The undersigned registered owner of this Warrant
irrevocably exercises this Warrant for the purchase of ______ shares of Common Stock of Cadiz Inc. and herewith makes payment therefor
in __________, all at the price and on the terms and conditions specified in this Warrant and requests that the shares of Common Stock
hereby purchased (and any securities or other property issuable upon such exercise) be issued in the name of, and delivered to, as applicable,
_________________, whose address is __________________________________ ____________________________________________________________________,
and, if such shares of Common Stock shall not include all of the shares of Common Stock issuable as provided in this Warrant, that a new
Warrant of like tenor and date for the balance of the shares of Common Stock issuable hereunder be delivered to the undersigned.


 


TO DELETE THE FOLLOWING BRACKETED LANGUAGE IF
INAPPLICABLE AT EXERCISE DATE:[The undersigned hereby notifies Cadiz Inc. that a Holder Group would beneficially own a number of shares
of Common Stock in excess of the Beneficial Ownership Limitation set forth in this Warrant upon giving effect to this Exercise Notice.
Pursuant to such limitation, Cadiz Inc. shall give effect to this Exercise Notice in accordance with such limitation as of [INSERT DATE],
the date hereof].


 


	 	 
	 	(Name of Registered Owner)
	 	 
	 	 
	 	(Signature of Registered Owner)
	 	 
	 	 
	 	(Street Address)
	 	 
	 	 
	 	(City)      (State)      (Zip Code)


 


	NOTICE:	The signature on this Exercise Notice must correspond with the name as written upon the face of the within Warrant in every particular, without alteration or enlargement or any change whatsoever.


 




     


    


    

 


ANNEX B TO THE WARRANT


 


ASSIGNMENT FORM


 


FOR VALUE RECEIVED the undersigned registered owner
of this Warrant hereby assigns unto the assignee named below all of the rights of the undersigned under this Warrant, with respect to
the number of shares of Common Stock set forth below:


 


	Name and Address of Assignee	 	No. of Shares of Common Stock
	 	 	 
	 	 	 
	 	 	 



 


and does hereby irrevocably constitute and appoint ________ _____________
attorney-in-fact to register such transfer onto the books of Cadiz Inc. maintained for the purpose, with full power of substitution in
the premises.


 


	Dated:	Print Name:
	 	 
	Signature:	Witness
	 	 
	 	 
	NOTICE:	The signature on this assignment must correspond with the name as written upon the face of the within Warrant in every particular, without alteration or enlargement or any change whatsoever.