WARRANT AGREEMENT


 


SELWAY CAPITAL ACQUISITION CORPORATION


 


and


 


AMERICAN STOCK TRANSFER & TRUST COMPANY,
LLC,


 


as Warrant Agent


 


Dated as of November 7, 2011


 



    	 



    	 



    

 


TABLE
OF CONTENTS


 


	 	 	Page
	 	 	 
	SECTION 1.	Appointment of Warrant Agent	1
	SECTION 2.	Warrant Certificates	1
	SECTION 3.	Execution of Warrant Certificates	1
	SECTION 4.	Registration and Countersignature	2
	SECTION 5.	Registration of Transfers and Exchanges; Transfer Restrictions	2
	SECTION 6.	Terms of Warrants	4
	SECTION 7.	Payment of Taxes	8
	SECTION 8.	Mutilated or Missing Warrant Certificates	8
	SECTION 9.	Reservation of Warrant Shares	8
	SECTION 10.	Obtaining Stock Exchange Listings; State Registration	9
	SECTION 11.	Adjustment of Number of Warrant Shares	9
	SECTION 12.	Fractional Interests	15
	SECTION 13.	Notices to Warrant Holders	15
	SECTION 14.	Merger, Consolidation or Change of Name of Warrant Agent	16
	SECTION 15.	Conditions to Warrant Agent Duties and Obligations	17
	SECTION 16.	Change of Warrant Agent	20
	SECTION 17.	Notices to Company and Warrant Agent	20
	SECTION 18.	Supplements and Amendments	21
	SECTION 19.	Successors	21
	SECTION 20.	Termination	21
	SECTION 21.	Governing Law	21
	SECTION 22.	Benefits of This Agreement	22
	SECTION 23.	Counterparts	22
	SECTION 24.	Force Majeure	22
	EXHIBIT A	 	24
	EXHIBIT B	 	28
	EXHIBIT C	 	29


 



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WARRANT AGREEMENT


 


This Warrant Agreement
(this “Agreement”) is made as of November 7, 2011 between Selway Capital Acquisition Corporation, a Delaware
corporation (the “Company”), and American Stock Transfer & Trust Company, LLC, a limited liability
trust company, as Warrant Agent (the “Warrant Agent”).


 


WHEREAS, the Company
has filed with the Securities and Exchange Commission (the “SEC”) a Registration Statement, No. 333-172714 on
Form S-1 (as may be amended from time to time) (the “Registration Statement”) for the initial public offering
of units (the “Initial Public Offering”), each unit (“Unit”) consisting of one Series A Share
of the Company’s common stock, par value $0.0001 per share (“Series A Shares”), and one warrant, each
warrant to purchase one share of common stock at an exercise price of $7.50 per share (“Public Warrants”);


 


WHEREAS, the Company
has agreed to issue (i) in a private placement to occur immediately prior to the closing of the Initial Public Offering, an aggregate
of 2,333,333 warrants to purchase shares of common stock (the “Placement Warrants”) to Selway Capital Holdings,
LLC (the “Private Placement Warrantholder”), and (ii) up to 2,000,000 Public Warrants (together with the Placement
Warrants, the “Warrants”).  The shares of common stock issuable on exercise of the Warrants are referred
to as the “Warrant Shares”; and


 


WHEREAS, the Company
desires the Warrant Agent to act on behalf of the Company, and the Warrant Agent is willing to so act, in connection with the issuance,
transfer, exchange and exercise of the Warrants and other matters as provided herein;


 


NOW, THEREFORE, in
consideration of the premises and the mutual agreements herein set forth, the parties hereto agree as follows:


 


SECTION
1.          Appointment of Warrant Agent.   The Company
hereby appoints the Warrant Agent to act as agent for the Company in accordance with the instructions set forth in this Agreement,
and the Warrant Agent hereby accepts such appointment.


 


SECTION
2.          Warrant Certificates.  The Warrant Agent
shall deliver certificates evidencing the Warrants (the “Warrant Certificates”) pursuant to this Agreement
in registered form only substantially in the form set forth in Exhibit A attached hereto, and the warrant certificates for the
Placement Warrants must bear the legend set forth in Exhibit B, except as set forth herein.


 


SECTION
3.          Execution of Warrant Certificates.


 


3.1           Warrant
Certificates must be signed on behalf of the Company by its Chairman of the Board, President, Chief Executive Officer or a Vice
President. Each such signature upon the Warrant Certificates may be in the form of a facsimile signature of the present or any
future Chairman of the Board, President, Chief Executive Officer, or Vice President, and may be imprinted or otherwise reproduced
on the Warrant Certificates and for that purpose the Company may adopt and use the facsimile signature of any person who has been
Chairman of the Board, President, Chief Executive Officer, or Vice President, notwithstanding the fact that at the time the Warrant
Certificates is countersigned and delivered or disposed of he or she has ceased to hold such office.


 



    	 



    	 



    

 


3.2           If
any officer of the Company who has signed any of the Warrant Certificates ceases to be such officer before the Warrant Certificates
so signed have been countersigned by the Warrant Agent, or disposed of by the Company, such Warrant Certificates nevertheless may
be countersigned and delivered or disposed of as though such person had not ceased to be such officer of the Company; and any Warrant
Certificate may be signed on behalf of the Company by any person who, at the actual date of the execution of such Warrant Certificate,
is a proper officer of the Company to sign such Warrant Certificate, although at the date of the execution of this Agreement any
such person was not such officer.


 


3.3           The
Warrant Agent shall date the Warrant Certificates the date of countersignature by the Warrant Agent.


 


SECTION
4.          Registration and Countersignature.


 


4.1           The
Warrant Agent shall, upon written instructions of the Chairman of the Board, the President, the Chief Executive Officer, a Vice
President, the Treasurer or the Chief Financial Officer of the Company, countersign, issue and deliver Warrants as provided in
this Agreement.  Warrant Certificates not countersigned by the Warrant Agent will not be valid for any purpose.


 


4.2           The
Company and the Warrant Agent may deem and treat the registered holder(s) of the Warrant Certificates as the absolute owner(s)
thereof (notwithstanding any notation of ownership or other writing thereon made by anyone), for all purposes, and neither the
Company nor the Warrant Agent shall be affected by any notice to the contrary.


 


SECTION
5.          Registration of Transfers and Exchanges; Transfer Restrictions.


 


5.1           The
Warrant Agent shall from time to time, subject to the limitations of this Section 5, register the transfer of any outstanding Warrant
Certificates upon the records to be maintained by it for that purpose, upon surrender thereof duly endorsed or accompanied (if
so required by the Warrant Agent) by a written instrument or instruments of transfer in form satisfactory to the Warrant Agent,
duly executed by the registered holder or holders thereof or by the duly appointed legal representative thereof or by a duly authorized
attorney.  Upon any such registration of transfer, the Warrant Agent shall issue a new Warrant Certificate to the transferee(s)
and shall cancel the surrendered Warrant Certificate.  The Warrant Agent shall dispose of such cancelled Warrant Certificates
in its customary manner.


 


5.2           The
Placement Warrants may not be sold or transferred until the Company completes its initial acquisition transaction (as described
more fully in the Registration Statement) ( the “Initial Acquisition Transaction”), except to a Permitted Transferee
who agrees in writing with the Company to be subject to such transfer restrictions.


 



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5.3          As
used herein, “Permitted Transferee” means


 


(a)          any
officer, director or employee of the Company;


 


(b)          an
affiliate or a member of the holder’s immediate family (or a member of the immediate family of its officers or directors)
or a trust or other entity, the beneficiary of which is the holder (or one of its officers or directors or a member of their respective
immediate families); or


 


(c)          any
successor in interest by virtue of the laws of descent and distribution upon death of any holder, or


 


(d)          pursuant
to a qualified domestic relations order.


 


5.4         The
holder of any Placement Warrants or Warrant Shares issued upon exercise of any Placement Warrants further agree, prior to any transfer
of such securities, to give written notice to the Company expressing its desire to effect such transfer and describing briefly
the proposed transfer.  Upon receiving such notice, the Company shall present copies thereof to its counsel and the holder
agrees not to make any disposition of all or any portion of such securities unless and until:


 


(a)          there
is then in effect a registration statement under the Securities Act covering such proposed disposition and such disposition is
made in accordance with such registration statement, in which case the legends set forth in Exhibit B or Section 6(c) hereof,
as the case may be (collectively the “Legends”) with respect to such securities sold pursuant to such registration
statement shall be removed; or


 


(b)          if
reasonably requested by the Company, (A) the holder shall have furnished the Company with an opinion of counsel, reasonably satisfactory
to the Company, that such disposition will not require registration of such Securities under the Securities Act, (B) the Company
shall have received customary representations and warranties regarding the transferee that are reasonably satisfactory to the Company
signed by the proposed transferee and (C) the Company shall have received an agreement by such transferee to the restrictions contained
in the Legends.


 


5.5         Each
Public Warrant must initially be issued together with one share of common stock as a Unit.  The shares of common stock
and Public Warrants comprising a Unit may not be separately transferable until 90 days following effectiveness of the Registration
Statement, unless Aegis Capital Corp. (the “Underwriter”) informs the Company of its decision to allow
earlier separate trading, subject to the Company having filed a Form 8-K with the Securities and Exchange Commission containing
an audited balance sheet reflecting the Company’s receipt of the gross proceeds of the offering of the Units and having issued
a press release announcing when such separate trading will begin (the “Detachment Date”).  Prior to
the Detachment Date, Public Warrants may be transferred or exchanged only together with the Unit in which such Public Warrant is
included, and only for the purpose of effecting, or in conjunction with, a transfer or exchange of such Unit.  Furthermore,
prior to the Detachment Date, each transfer of a Public Unit on the register relating to such Units shall operate also to transfer
the Public Warrant included in such Unit.


 



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5.6         Subject
to the terms of this Agreement, Warrant Certificates may be exchanged at the option of the holder(s) thereof, when surrendered
to the Warrant Agent at its principal corporate trust office, which is currently located at the address listed in Section 17 hereof,
for another Warrant Certificate or other Warrant Certificates of like tenor and representing in the aggregate a like number of
Warrants.  Any holder desiring to exchange a Warrant Certificate shall deliver a written request to the Warrant Agent,
and shall surrender, duly endorsed or accompanied (if so required by the Warrant Agent) by a written instrument or instruments
of transfer in form satisfactory to the Warrant Agent, the Warrant Certificate or Certificates to be so exchanged.  Warrant
Certificates surrendered for exchange shall be cancelled by the Warrant Agent.  Such cancelled Warrant Certificates shall
then be disposed of by such Warrant Agent in its customary manner.


 


5.7         The
Warrant Agent is hereby authorized to countersign, in accordance with the provisions of this Section 5 and of Section 4 hereof,
the new Warrant Certificates required pursuant to the provisions of this Section 5.


 


SECTION
6.         Terms of Warrants.


 


6.1          Exercise
Price and Exercise Period.


 


(a)          The
initial exercise price per share that Warrant Shares may be purchasable upon the exercise of full Warrants (the “Exercise
Price”) is $7.50 per share, and each Warrant is initially exercisable to purchase one share of common stock.


 


(b)          Subject
to the terms of this Agreement (including without limitation Section 6.4 below), each Warrant holder has the right, which may be
exercised commencing at the opening of business on the first day of the applicable Warrant Exercise Period set forth below and
until 5:00 p.m., New York City time, on the last day of such Warrant Exercise Period, to receive from the Company the number of
fully paid and nonassessable Warrant Shares which the holder may at the time be entitled to receive on exercise of such Warrants
and payment of the Exercise Price then in effect for such Warrant Shares.  No adjustments as to dividends will be made
upon exercise of the Warrants.


 


(c)          The
“Warrant Exercise Period” for all Warrants commences (subject to Section 6.4 below) on the later of: (A) the
date that is one year from the date that the Registration Statement is declared effective by the Securities and Exchange Commission
(the “Effective Date”) or (B) the date on which the Company consolidates each of its series of common stock
into one class of common stock after it completes its Initial Acquisition Transaction,  post-acquisition tender offer, or
post-acquisition automatic trust liquidation, as the case may be, and ends on the earlier of: (A) the date that is five years from
the Effective Date or (B) the trading day preceding the date on which such Warrants are redeemed pursuant to Section
6.2 below, or (C) upon the dissolution and winding up of the Company.


 


(d)          Each
Warrant not exercised prior to 5:00 p.m., New York City time, on the last day of the Warrant Exercise Period shall become void
and all rights thereunder and all rights in respect thereof under this Agreement shall cease as of such time.


 



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6.2          Redemption
of Warrants.


 


(a)          The
Company may call the Public Warrants for redemption at a price of $0.01 per Public Warrant, upon not less than 30 days’ prior
written notice of redemption to each Public Warrant holder, at any time after such Public Warrants have become exercisable pursuant
to Section 6(a), if, and only if, (i) the Closing Price has equaled or exceeded $17.50 (the “Redemption Threshold”)
per share for any 20 trading days within a 30-trading-day period ending on the third trading day prior to the notice of redemption
to Public Warrant holders and (ii) at all times between the date of such notice of redemption and the redemption date a registration
statement is in effect covering the Warrant Shares issuable upon exercise of the Public Warrants and a current prospectus relating
to those Warrant Shares is available.


 


(b)          The
“Closing Price” of the common stock on any date of determination means:


 


(i)          the
closing sale price for the regular trading session (without considering after hours or other trading outside regular trading session
hours) of the common stock (regular way) as reported in the composite transactions for the principal United States securities exchange
on which the common stock is so listed on that date (or, if no closing price is reported, the last reported sale price during that
regular trading session), or


 


(ii)         if
the common stock is not so listed, the last quoted sales price for the common stock in the over-the-counter market as reported
by the OTC Bulletin Board, the National Quotation Bureau or similar organization, or


 


(iii)        if
the common stock is not so quoted, the average of the mid-point of the last bid and ask prices for the common stock from at least
three nationally recognized investment-banking firms that the Company selects for this purpose.


 


6.3          Exercise
Procedure.


 


(a)          A
Warrant may be exercised upon surrender to the Company at the principal stock transfer office of the Warrant Agent, which is currently
located at the address listed in Section 17 hereof, of the certificate or certificates evidencing the Warrants to be exercised
with the form of election to purchase on the reverse thereof duly filled in and signed and such other documentation as the Warrant
Agent may reasonably request, and upon payment to the Warrant Agent for the account of the Company of the Exercise Price (adjusted
as herein provided if applicable) for the number of Warrant Shares in respect of which such Warrants are then exercised.  Payment
of the aggregate Exercise Price must be made in cash or by certified or official bank check payable to the order of the Company
in New York Clearing House Funds, or the equivalent thereof.


 



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(b)          A
Warrant may be settled on a cashless basis (in lieu of payment of the Exercise Price) in accordance with the following formula:


 


N’= (N x (P - E)) / P


 


where:


 


N’ =        the
adjusted number of shares of common stock issuable upon cashless exercise of each Warrant.


 


N =         the current
number of shares of common stock issuable upon exercise of each Warrant.


 


E =          the
Exercise Price on the date of cashless exercise of the Warrants.


 


P =          the
average reported last sales price of the common stock for the last 10 trading days ending on the third trading day prior to
the date on which notice of cashless exercise is given.


 


(c)          Subject
to the provisions of Section 7, upon surrender of Warrants and payment of the Exercise Price or the settlement therefor on a cashless
basis in accordance with Section 6.3(b) above, the Company shall issue and cause to be delivered with all reasonable dispatch to
and in such name or names as the Warrant holder may designate, a certificate or certificates for the number of full Warrant Shares
issuable upon the exercise of such Warrants.  Such certificate or certificates are to be deemed to have been issued and
any person so designated to be named therein is to be deemed to have become a holder of record of such Warrant Shares as of the
date of the surrender of such Warrants and payment of the Exercise Price.


 


(d)          The
Warrants may be exercisable, at the election of the holders thereof, either in full or from time to time in part and, in the event
that a certificate evidencing Warrants is exercised in respect of fewer than all of the Warrant Shares issuable on such exercise
at any time prior to the date of expiration of the Warrants, a new certificate evidencing the remaining Warrant or Warrants will
be issued, and the Warrant Agent is hereby irrevocably authorized to countersign and to deliver the required new Warrant Certificate
or Certificates pursuant to the provisions of this Section 6 and of Section 4 hereof, and the Company, whenever required by the
Warrant Agent, shall supply the Warrant Agent with Warrant Certificates duly executed on behalf of the Company for such purpose.  The
Warrant Agent may assume that any Warrant presented for exercise is permitted to be so exercised under applicable law and shall
have no liability for acting in reliance on such assumption.


 


(e)          The
Warrant Agent shall cancel all Warrant Certificates surrendered upon exercise of Warrants and shall then dispose of such Warrant
Certificates in its customary manner.  The Warrant Agent shall account promptly to the Company with respect to Warrants
exercised and shall concurrently pay to the Company all monies received by the Warrant Agent for the purchase of the Warrant Shares
through the exercise of such Warrants, unless the exercise is settled on a cashless basis in accordance with Section 6.3(b) above.


 



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(f)          The
Warrant Agent shall keep copies of this Agreement and any notices given or received hereunder available for inspection by the holders
with reasonable prior written notice during normal business hours at its office.  The Company shall supply the Warrant
Agent from time to time with such numbers of copies of this Agreement as the Warrant Agent may request.


 


(g)          Certificates
evidencing Warrant Shares issued upon exercise of a Placement Warrant must bear the following legends:


 


THE SECURITIES REPRESENTED
HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY STATE SECURITIES LAW, AND MAY NOT BE OFFERED,
SOLD, TRANSFERRED OR OTHERWISE DISPOSED OF UNLESS REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND ANY APPLICABLE STATE
SECURITIES LAWS OR AN EXEMPTION FROM SUCH REGISTRATION IS AVAILABLE.


 


SECURITIES EVIDENCED
BY THIS CERTIFICATE WILL BE ENTITLED TO REGISTRATION RIGHTS UNDER A REGISTRATION RIGHTS AGREEMENT TO BE EXECUTED BY THE COMPANY.


 


SECURITIES EVIDENCED
BY THIS CERTIFICATE ARE SUBJECT TO THE TERMS AND CONDITIONS OF AN ESCROW AGREEMENT BY AND BETWEEN THE COMPANY AND THE HOLDER OF
THIS CERTIFICATE.  THESE SHARES MAY NOT BE SOLD EXCEPT IN COMPLIANCE WITH THAT AGREEMENT.


 


6.4           Registration
Requirement. Notwithstanding anything else in this Section 6, no Public Warrants may be exercised by the holder paying
the Exercise Price in cash unless at the time of exercise (i) a registration statement covering the Warrant Shares to be issued
upon exercise (other than Warrant Shares to be issued upon exercise of any Placement Warrant) is effective under the Securities
Act of 1933, as amended (the “Act”) and (ii) a prospectus thereunder relating to the Warrant Shares is current.  The
Company shall use commercially reasonable best efforts to have a registration statement in effect covering Warrant Shares issuable
upon exercise of the Warrants from the date the Warrants become exercisable and to maintain a current prospectus relating to those
Warrant Shares until the Warrants expire or are redeemed. In the event that, at the end of the Warrant Exercise Period, a Warrant
has not been exercised, all the rights of the holder hereunder shall terminate and such Warrant shall expire unexercised and worthless,
and as a result purchasers of the Units will have paid the full Unit price solely for the share of common stock included in each
Unit.  The Company is not required to issue unregistered shares upon the exercise of any Warrant; provided, however,
that the Company shall issue unregistered shares upon the exercise of any Placement Warrant, if, at the time of such exercise,
there is not an effective registration statement or current prospectus covering the Warrant Shares underlying such Placement Warrant.
In no event will the registered holder of the Warrant be entitled to receive a net-cash settlement, securities or other consideration
in lieu of physical settlement in shares of common stock, regardless of whether the common stock underlying the Warrants is registered
pursuant to an effective registration statement.


 



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SECTION
7.          Payment of Taxes.  The Company shall pay
all documentary stamp taxes attributable to the initial issuance of Warrant Shares upon the exercise of Warrants; provided,
however, that the Company shall not be required to pay any tax or taxes which may be payable in respect of any transfer
involved in the issue of any Warrant Certificates or any certificates for Warrant Shares in a name other than that of the registered
holder of a Warrant Certificate surrendered upon the exercise of a Warrant, and the Company shall not be required to issue or
deliver such Warrant Certificates unless or until the person or persons requesting the issuance thereof have paid to the Company
the amount of such tax or have established to the satisfaction of the Company that such tax has been paid.


 


SECTION
8.          Mutilated or Missing Warrant Certificates.  If
any Warrant Certificate is mutilated, lost, stolen or destroyed, the Company shall issue and the Warrant Agent shall countersign,
in exchange and substitution for and upon cancellation of the mutilated Warrant Certificate, or in lieu of and substitution for
the Warrant Certificate lost, stolen or destroyed, a new Warrant Certificate of like tenor and representing an equivalent number
of Warrants, but only upon receipt of indemnity and evidence in each case satisfactory to the Company and the Warrant Agent of
such loss, theft or destruction of such Warrant Certificate.  Applicants for such new Warrant Certificates shall pay
such reasonable charges as the Company may prescribe.


 


SECTION
9.          Reservation of Warrant Shares.


 


9.1           The
Company shall at all times reserve and keep available, free from preemptive rights, out of the aggregate of its authorized but
unissued common stock or its authorized and issued common stock held in its treasury, for the purpose of enabling it to satisfy
any obligation to issue Warrant Shares upon exercise of Warrants, the maximum number of shares of common stock which may then be
deliverable upon the exercise of all outstanding Warrants.  The Warrant Agent is not required to verify availability
of such shares set aside by the Company.


 


9.2           The
Company or, if appointed, the transfer agent for the common stock (the “Transfer Agent”) and every subsequent
transfer agent for any shares of the Company’s common stock issuable upon the exercise of any of the Warrants is hereby irrevocably
authorized and directed at all times to reserve such number of authorized shares as shall be required for such purpose.  The
Company shall keep a copy of this Agreement on file with the Transfer Agent and with every subsequent transfer agent for any shares
of the Company’s common stock issuable upon the exercise of the Warrants.  The Warrant Agent is hereby irrevocably
authorized to requisition from time to time from such Transfer Agent the stock certificates required to honor outstanding Warrants
upon exercise thereof in accordance with the terms of this Agreement.  The Company shall supply such Transfer Agent with
duly executed certificates for such purposes.  The Company shall furnish such Transfer Agent a copy of all notices of
adjustments and certificates related thereto, transmitted to each holder pursuant to Section 13 hereof.


 


9.3           Before
taking any action which would cause an adjustment pursuant to Section 11 hereof to reduce the Exercise Price below the then par
value (if any) of the Warrant Shares, the Company shall take any commercially reasonable corporate action which may, in the opinion
of its counsel (which may be counsel employed by the Company), be necessary in order that the Company may validly and legally issue
fully paid and nonassessable Warrant Shares at the Exercise Price as so adjusted.


 



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9.4          The
Company shall, upon exercise of Warrants and payment of the Exercise Price therefor, issue Warrant Shares that are fully paid,
nonassessable, free of preemptive rights and free from all taxes, liens, charges and security interests with respect to the issue
thereof.


 


SECTION
10.        Obtaining Stock Exchange Listings; State Registration.  The
Company shall from time to time take all commercially reasonable actions which may be necessary so that the Warrant Shares, immediately
upon their issuance upon the exercise of Warrants, will be listed on the principal securities exchanges and markets within the
United States of America, if any, on which other shares of common stock are then listed.  To the extent that the common
stock is not listed on a national securities exchange or there is no exemption from state “blue sky” securities laws
for the issuance of the Warrant Shares, the Company will take all commercially reasonable actions necessary so that the Warrant
Shares are registered in all states in which the holders of the Warrants reside.


 


SECTION
11.        Adjustment of Number of Warrant Shares.  The
number of Warrant Shares issuable upon the exercise of each Warrant is subject to adjustment from time to time upon the occurrence
of the events enumerated in this Section 11.  For purposes of this Section 11, “common stock” means shares
now or hereafter authorized of any class of common stock of the Company and any other stock of the Company, however designated,
that has the right (subject to any prior rights of any class or series of preferred stock) to participate in any distribution
of the assets or earnings of the Company without limit as to per share amount.


 


11.1        Adjustment
for Change in Capital Stock. If the Company:  (i) pays a dividend or makes a distribution on its common stock in
either case in shares of its common stock; (ii) subdivides its outstanding shares of common stock into a greater number of shares;
(iii) combines its outstanding shares of common stock into a smaller number of shares; (iv) makes a distribution on its common
stock in shares of its capital stock other than common stock; or (v) issues by reclassification of its common stock any shares
of its capital stock, then the number of shares of common stock issuable upon exercise of each Warrant immediately prior to such
action shall be proportionately adjusted so that the holder of any Warrant thereafter exercised shall receive the aggregate number
and kind of shares of capital stock of the Company which he would have owned immediately following such action if such Warrant
had been exercised immediately prior to such action.  The adjustment shall become effective immediately after the record
date in the case of a dividend or distribution and immediately after the effective date in the case of a subdivision, combination
or reclassification.  Such adjustment shall be made successively whenever any event listed above shall occur.


 


11.2        Adjustment
for Rights Issue.


 


(a)          If
the Company distributes any rights, options or warrants to all holders of its common stock entitling them to purchase shares of
common stock at a price per share less than the Closing Price per share on the Business Day immediately preceding the ex-dividend
date for such distribution of rights, options or warrants, the number of shares of common stock issuable upon exercise of each
Warrant is to be adjusted in accordance with the following formula:


 



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N’= N x ((O+A) / (O+(A x (P/M))))


 


where:


 


N’ =        the
adjusted number of shares of common stock issuable upon exercise of each Warrant.


 


N =         the current
number of shares of common stock issuable upon exercise of each Warrant.


 


O =         the number
of shares of common stock outstanding on the record date for such distribution.


 


A =         the number
of additional shares of common stock issuable pursuant to such rights or warrants.


 


P  =         the
purchase price per share of the additional shares.


 


M =        the Closing
Price per share of common stock on the record date.


 


(b)          The
adjustment is to be made successively whenever any such rights, options or warrants are issued and is to become effective immediately
after the record date for the determination of stockholders entitled to receive the rights, options or warrants.  If
at the end of the period during which such rights, options or warrants are exercisable, not all rights, options or warrants have
been exercised, the number of shares of common stock issuable upon exercise of each Warrant is to be immediately readjusted to
what it would have been if “N” in the above formula had been the number of shares actually issued.


 


11.3        Adjustment
for Other Distributions.


 


(a)          If
the Company distributes to all holders of its common stock any of its assets (including cash) or debt securities or any rights,
options or warrants to purchase debt securities, assets or other securities of the Company (other than common stock), the number
of shares of common stock issuable upon exercise of each Warrant is to be adjusted in accordance with the formula:


 



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N’ = N x (M / (M-F))


 


where:


 


N’ =        the
adjusted number of shares of common stock issuable upon exercise of each Warrant.


 


N =         the current
number of shares of common stock issuable upon exercise of each Warrant.


 


M =        the Closing
Price per share of common stock on the Business Day immediately preceding the ex dividend date for such distribution.


 


F =          the
fair market value on the ex dividend date for such distribution of the assets, securities, rights or warrants distributable to
one share of common stock after taking into account, in the case of any rights, options or warrants, the consideration required
to be paid upon exercise thereof.  The Board of Directors shall reasonably determine the fair market value in good faith.


 


(b)          The
adjustment is to be made successively whenever any such distribution is made and shall become effective immediately after the record
date for the determination of stockholders entitled to receive such distribution.


 


(c)          If
any adjustment is made pursuant to this Section 11.3 as a result of the issuance of rights, options or warrants and at the end
of the period during which any such rights, options or warrants are exercisable, not all such rights, options or warrants shall
have been exercised, the Warrant shall be immediately readjusted as if “F” in the above formula was the fair market
value on the ex-dividend date for such distribution of the indebtedness or assets actually distributed upon exercise of such rights,
options or warrants divided by the number of shares of common stock outstanding on the ex-dividend date for such distribution.  Notwithstanding
anything to the contrary contained in this subsection (c), if “M−F” in the above formula is less than $1.00,
the Company may elect to, and if “M−F” or is a negative number, the Company shall, in lieu of the adjustment
otherwise required by this Section 11.3, distribute to the holders of the Warrants, upon exercise thereof, the evidences of indebtedness,
assets, rights, options or warrants (or the proceeds thereof) which would have been distributed to such holders had such Warrants
been exercised immediately prior to the record date for such distribution.


 


11.4        Defined
Terms; When De Minimis Adjustment May Be Deferred.


 


(a)          As
used in this Section 11:


 


(i)          “Closing
Price” of the common stock on any date of determination means: (x) the closing sale price for the regular trading session
(without considering after hours or other trading outside regular trading session hours) of the common stock (regular way) as reported
in the composite transactions for the principal United States securities exchange on which the common stock is so listed on that
date (or, if no closing price is reported, the last reported sale price during that regular trading session); (y) if the common
stock is not so reported, the last quoted sales price for the common stock in the over the counter market as reported by the OTC
Bulletin Board, the National Quotation Bureau or similar organization; or (z) if the common stock is not so quoted, the average
of the mid-point of the last bid and ask prices for the common stock from at least three nationally recognized investment-banking
firms that the Company selects for this purpose;


 



    	11



    	 



    

 


(ii)         “ex-dividend
date” means the first date on which the shares of common stock trade on the applicable exchange or in the applicable
market, regular way, without the right to receive the issuance or distribution in question;


 


(iii)        “trading
day” means, with respect to the common stock or any other security, a day during which (A) trading in the common stock
or such other security generally occurs, (B) there is no market disruption event (as defined below) and (C) a Closing Price for
the common stock or such other security (other than a Closing Price referred to in the next to last clause of such definition)
is available for such day; provided that if the common stock or such other security is not admitted for trading or quotation on
or by any exchange, bureau or other organization, “trading day” will mean any Business Day;


 


(iv)        “market
disruption event” means, with respect to the common stock or any other security, the occurrence or existence of more
than one-half hour period in the aggregate or any scheduled trading day for the common stock or such other security of any suspension
or limitation imposed on trading (by reason of movements in price exceeding limits permitted by the stock exchange or otherwise)
in the common stock or such other security or in any options, contract, or future contracts relating to the common stock or such
other security, and such suspension or limitation occurs or exists at any time before 1:00 p.m.  (New York time) on such
day; and


 


(v)         “Business
Day” means, any day which is not a Saturday, a Sunday or any other day on which banks in the City of New York, New York,
are authorized or required by law to close.


 


(b)          No
adjustment in the number of shares of common stock issuable upon exercise of each Warrant need be made unless the adjustment would
require an increase or decrease of at least 1% in such number.  Any adjustments that are not made are to be carried forward
and taken into account in any subsequent adjustment.


 


(c)          All
calculations under this Section 11 are to be made to the nearest cent or to the nearest 1/100th of a share, as the case may be.


 


11.5        When
No Adjustment Required.


 


(a)          No
adjustment need be made for a transaction referred to in Sections 11.2-11.3 if Warrant holders are to participate, without requiring
the Warrants to be exercised, in the transaction on a basis and with notice that the Board of Directors of the Company reasonably
determines to be fair and appropriate in light of the basis and notice on which holders of common stock participate in the transaction.


 



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(b)          No
adjustment need be made for a change in the par value or no par value of the common stock.


 


(c)          To
the extent the Warrants become convertible into cash, no adjustment need be made thereafter as to the amount of cash into which
such Warrants are exercisable.  Interest will not accrue on the cash.


 


11.6        Notice
of Adjustment.  Whenever the number of shares of common stock issuable upon exercise of each Warrant is adjusted,
the Company shall provide the notices required by Section 13 hereof.


 


11.7        Notice
of Certain Transactions.


 


(a)          The
Company shall mail to Warrant holders a notice stating the proposed record date for a dividend or distribution or the proposed
effective date of a subdivision, combination, reclassification, consolidation, merger, transfer, lease, liquidation or dissolution
if:


 


(i)          the
Company takes any action that would require an adjustment in the Exercise Price pursuant to this Section 11, and if the Company
does not arrange for Warrant holders to participate pursuant to Section 11.5;


 


(ii)         the
Company takes any action that would require a supplemental Warrant Agreement pursuant to Section 11.8; or


 


(iii)        there
is a liquidation or dissolution of the Company.


 


(b)          The
Company shall mail the notice at least 15 days before such date.  Failure to mail the notice or any defect in it will
not affect the validity of the transaction.


 






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11.8        Reorganization
of Company.


 


(a)          If
the Company consolidates or merges with or into, or transfers or leases all or substantially all its assets to, any person, upon
consummation of such transaction, the Warrants will automatically become exercisable for the kind and amount of securities, cash
or other assets which the holder of a Warrant would have owned immediately after the consolidation, merger, transfer or lease if
such holder had exercised the Warrant immediately before the effective date of the transaction; provided that (i) if the holders
of common stock were entitled to exercise a right of election as to the kind or amount of securities, cash or other assets receivable
upon such consolidation or merger, then the kind and amount of securities, cash or other assets for which each Warrant becomes
exercisable is to be deemed the weighted average of the kind and amount received per share by the holders of common stock in such
consolidation or merger that affirmatively make such election or (ii) if a tender or exchange offer has been made to and accepted
by the holders of common stock under circumstances in which, upon completion of such tender or exchange offer, the maker thereof,
together with members of any group (within the meaning of Rule 13d-5(b)(1) under the Securities Exchange Act of 1934, as amended
(the “Exchange Act”)) of which such maker is a part, and together with any affiliate or associate of such maker
(within the meaning of Rule 12b-2 under the Exchange Act) and any members of any such group of which any such affiliate or associate
is a part, own beneficially (within the meaning of Rule 13d-3 under the Exchange Act) more than 50% of the outstanding shares of
common stock, the holder of a Warrant is entitled to receive the highest amount of cash, securities or other property to which
such holder would actually have been entitled as a shareholder if such Warrant holder had exercised the Warrant prior to the expiration
of such tender or exchange offer, accepted such offer and all of the common stock held by such holder had been purchased pursuant
to such tender or exchange offer, subject to adjustments (from and after the consummation of such tender or exchange offer) as
nearly equivalent as possible to the adjustments provided for in this Section 11; provided further, however, that
if less than 70% of the consideration (the “Public Share Percentage”) receivable by the holders of the common
stock in the applicable event is payable in the form of common stock in the successor entity that is listed for trading on a national
securities exchange or on the OTC Bulletin Board, or is to be so listed for trading immediately following such event, then the
Exercise Price shall be reduced by an amount (in dollars) equal to the quotient of: (x) the Redemption Threshold minus the Per
Share Consideration (as defined below) (but in no event, less than zero) and (y) if the applicable event is announced on or prior
to the third anniversary of the closing date of the Initial Business Combination, 2; if the applicable event is announced after
the third anniversary of the closing date of the Initial Business Combination and on or prior to the fourth anniversary of the
closing date of the Initial Business Transaction, 2.5; if the applicable event is announced after the fourth anniversary of the
closing date of the Initial Business Combination and on or prior to the Expiration Date, 3. “Per Share Consideration”
means (i) if the consideration paid to holders of shares of common stock consists exclusively of cash, the amount of such cash
per share of common stock, and (ii) in all other cases, the average reported last sales price of the common stock for the last
10 trading days ending on the trading day prior to the effective date of the applicable event.  Concurrently with the
consummation of any such transaction, the corporation or other entity formed by or surviving any such consolidation or merger if
other than the Company, or the person to which such sale or conveyance has been made, shall enter into a supplemental Warrant Agreement
so providing and further providing for adjustments which are to be as nearly equivalent as may be practical to the adjustments
provided for in this Section.  The successor Company shall mail to Warrant holders a notice describing the supplemental
Warrant Agreement.


 


(b)          If
the issuer of securities deliverable upon exercise of Warrants under the supplemental Warrant Agreement is an affiliate of the
formed, surviving, transferee or lessee corporation, that issuer shall join in the supplemental Warrant Agreement.


 


(c)          If
this Section 11.8 applies, Sections 11.2-11.7 do not apply.


 


11.9        Warrant
Agent’s Disclaimer. The Warrant Agent is not required to determine when an adjustment under this Section 11 should be
made, how it should be made or what it should be.  The Warrant Agent is not required to determine whether any provisions
of a supplemental Warrant Agreement under Section 11.8 are correct.  The Warrant Agent makes no representation as to
the validity or value of any securities or assets issued upon exercise of Warrants.  The Warrant Agent is not responsible
for the Company’s failure to comply with this Section.


 



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11.10       When
Issuance or Payment May Be Deferred. In any case in which this Section 11 requires that an adjustment in the number of shares
of common stock issuable upon exercise of each Warrant be made effective as of a record date for a specified event, the Company
may elect to defer until the occurrence of such event issuing to the holder of any Warrant exercised after such record date the
Warrant Shares and other capital stock of the Company, if any, issuable upon such exercise over and above the Warrant Shares and
other capital stock of the Company, if any, issuable upon such exercise on the basis of the number of shares of common stock issuable
upon exercise of each Warrant; provided, however, that the Company shall deliver to such holder a due bill or other
appropriate instrument evidencing such holder’s right to receive such additional Warrant Shares and other capital stock upon
the occurrence of the event requiring such adjustment.


 


11.11       Form
of Warrants. Notwithstanding any adjustments in the number or kind of shares issuable upon the exercise of the Warrants or
the Exercise Price, Warrants theretofore or thereafter issued may continue to express the same number and kind of shares and Exercise
Price as are stated in the Warrants initially issuable pursuant to this Agreement.


 


SECTION
12.       Fractional Interests.  The Company is not required
to issue fractional Warrant Shares on the exercise of Warrants.  If more than one Warrant is presented for exercise
in full at the same time by the same holder, the number of full Warrant Shares which are issuable upon the exercise thereof are
to be computed on the basis of the aggregate number of Warrant Shares purchasable on exercise of the Warrants so presented, rounded
down to the nearest whole number.


 


SECTION
13.       Notices to Warrant Holders.


 


13.1        Upon
any adjustment of the Exercise Price pursuant to Section 11, the Company shall promptly thereafter, and in any event within five
days, (a) cause to be filed with the Warrant Agent a certificate executed by the Chief Financial Officer or principal financial
officer of the Company setting forth the number of Warrant Shares issuable upon exercise of each Warrant after such adjustment
and setting forth in reasonable detail the method of calculation and the facts upon which such calculations are based, and (b)
cause to be given to each of the registered holders of the Warrant Certificates at his address appearing on the Warrant register
written notice of such adjustments by first-class mail, postage prepaid.  Where appropriate, such notice may be given
in advance and included as a part of the notice required to be mailed under the other provisions of this Section 13.  The
Warrant Agent may rely on any such certificate and on any adjustment therein contained and is not to be deemed to have knowledge
of such adjustment unless and until it has received such certificate.


 


13.2        The
Company shall cause to be filed with the Warrant Agent and shall cause to be given to each registered holder of Warrant Certificates
at his address appearing on the Warrant register, at least 10 calendar days prior to the applicable record date hereinafter specified,
or as promptly as practicable under the circumstances in the case of events for which there is no record date, by first-class mail,
postage prepaid, a written notice stating (i) the date as of which the holders of record of shares of common stock to be entitled
to receive any such rights, options, warrants or distribution are to be determined, (ii) the initial expiration date set forth
in any tender offer or exchange offer for shares of common stock, or (iii) the date on which any such consolidation, merger, conveyance,
transfer, dissolution, liquidation or winding up is expected to become effective or consummated, and the date as of which it is
expected that holders of record of shares of common stock are to be entitled to exchange such shares for securities or other property,
if any, deliverable upon such reclassification, consolidation, merger, conveyance, transfer, dissolution, liquidation or winding
up, in the event:


 



    	15



    	 



    

 


(a)          the
Company authorizes the issuance to all holders of shares of common stock of rights, options or warrants to subscribe for or purchase
shares of common stock or of any other subscription rights or warrants;


 


(b)          the
Company authorizes the distribution to all holders of shares of common stock of evidences of its indebtedness or assets (other
than regular cash dividends or dividends payable in shares of common stock or distributions referred to in Section 11.3);


 


(c)          of
any consolidation or merger to which the Company is a party and for which approval of any shareholders of the Company is required,
or of the conveyance or transfer of the properties and assets of the Company substantially as an entirety, or of any reclassification
or change of common stock issuable upon exercise of the Warrants (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 subdivision or combination), or a tender offer or exchange offer
for shares of common stock;


 


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


 


(e)          the
Company proposes to take any action not specified above which would require an adjustment of the Exercise Price pursuant to Section
11.


 


13.3       The
failure to give the notice required by this Section 13 or any defect therein does not affect the legality or validity of any distribution,
right, option, warrant, consolidation, merger, conveyance, transfer, dissolution, liquidation or winding up, or the vote upon any
action.  Nothing contained in this Agreement or in any of the Warrant Certificates is to be construed as conferring upon
the holders thereof the right to vote or to consent or to receive notice as shareholders in respect of the meetings of shareholders
or the election of Directors of the Company or any other matter, or any rights whatsoever as shareholders of the Company.


 


SECTION
14.        Merger, Consolidation or Change of Name of Warrant Agent. 


 


14.1         Any
corporation into which the Warrant Agent is merged or with which it is consolidated, or any corporation resulting from any merger
or consolidation to which the Warrant Agent is a party, or any corporation succeeding to all or substantially all the corporate
trust or agency business of the Warrant Agent, will be the successor to the Warrant Agent hereunder without the execution or filing
of any paper or any further act on the part of any of the parties hereto, provided that such corporation would be eligible for
appointment as a successor warrant agent under the provisions of Section 16.  If at the time the successor to the Warrant
Agent succeeds to the agency created by this Agreement, and if at that time any of the Warrant Certificates have been countersigned
but not delivered, any such successor to the Warrant Agent may adopt the countersignature of the original Warrant Agent; and if
at that time any of the Warrant Certificates have not been countersigned, any successor to the Warrant Agent may countersign such
Warrant Certificates either in the name of the predecessor Warrant Agent or in the name of the successor to the Warrant Agent;
and in all such cases such Warrant Certificates will have the full force and effect provided in the Warrant Certificates and in
this Agreement.


 



    	16



    	 



    

 


14.2         If
at any time the name of the Warrant Agent is changed and at such time any of the Warrant Certificates have been countersigned but
not delivered, the Warrant Agent whose name has been changed may adopt the countersignature under its prior name, and if at that
time any of the Warrant Certificates have not been countersigned, the Warrant Agent may countersign such Warrant Certificates either
in its prior name or in its changed name, and in all such cases such Warrant Certificates will have the full force and effect provided
in the Warrant Certificates and in this Agreement.


 


SECTION
15.        Conditions to Warrant Agent Duties and Obligations.  The
Warrant Agent undertakes the duties and obligations imposed by this Agreement (and no implied duties or obligations may be read
into this Agreement against the Warrant Agent) upon the following terms and conditions, by all of which the Company and the holders
of Warrants, by their acceptance thereof, are bound:


 


15.1         The
statements contained herein and in the Warrant Certificates may be taken as statements of the Company and the Warrant Agent assumes
no responsibility for the correctness of any of the same except such as describe the Warrant Agent or action taken or to be taken
by it.  The Warrant Agent assumes no responsibility with respect to the distribution of the Warrant Certificates except
as provided herein.


 


15.2         The
Warrant Agent is not responsible for any failure of the Company to comply with any of the covenants contained in this Agreement
or in the Warrant Certificates to be complied with by the Company.


 


15.3         The
Warrant Agent may consult at any time with counsel of its own selection (who may be counsel for the Company) and the Warrant Agent
incurs no liability or responsibility to the Company or to any holder of any Warrant Certificate in respect of any action taken,
suffered or omitted by it hereunder in good faith and in accordance with the opinion or the advice of such counsel.  The
Warrant Agent may execute any of the trusts or powers hereunder or perform any duties hereunder either directly or through agents
or attorneys and the Warrant Agent shall not be responsible for any misconduct or negligence on the part of any agent or attorney
appointed with due care by it hereunder.


 


15.4         The
Warrant Agent may conclusively rely, as to the truth of the statements and the correctness of the opinions expressed therein, upon
certificates or opinions furnished to the Warrant Agent and conforming to the requirements of this Agreement.  The Warrant
Agent incurs no liability or responsibility to the Company or to any holder of any Warrant Certificate for any action taken in
reliance on any Warrant Certificate, certificate of shares, notice, resolution, waiver, consent, order, certificate, or other paper,
document or instrument (whether in its original or facsimile form) believed by it to be genuine and to have been signed, sent or
presented by the proper party or parties.


 



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15.5         The
Company shall: (i) pay to the Warrant Agent reasonable remuneration for its services as such Warrant Agent as set forth on Exhibit
C hereto; (ii) reimburse the Warrant Agent for all reasonable expenses, taxes and governmental charges and other charges of
any kind and nature incurred by the Warrant Agent in the execution of this Agreement (including fees and expenses of its counsel);
and (iii) to indemnify the Warrant Agent (and any predecessor Warrant Agent) and save it harmless against any and all claims (whether
asserted by the Company, a holder or any other person), damages, losses, expenses (including taxes other than taxes based on the
income of the Warrant Agent), liabilities, including judgments, costs and counsel fees and expenses, for anything done or omitted
by the Warrant Agent in the execution of this Agreement except as a result of its negligence, willful misconduct, or bad faith.  The
provisions of this Section 15.5 survive the expiration of the Warrants and the termination of this Agreement.


 


15.6         The
Warrant Agent is not required to institute any action, suit or legal proceeding or to take any other action likely to involve expense
unless the Company or one or more registered holders of Warrant Certificates furnish the Warrant Agent with security and indemnity
satisfactory to it for any costs and expenses which may be incurred, but this provision will not affect the power of the Warrant
Agent to take such action as it may consider proper, whether with or without any such security or indemnity.  All rights
of action under this Agreement or under any of the Warrants may be enforced by the Warrant Agent without the possession of any
of the Warrant Certificates or the production thereof at any trial or other proceeding relative thereto, and any such action, suit
or proceeding instituted by the Warrant Agent is to be brought in its name as Warrant Agent and any recovery of judgment is to
be for the ratable benefit of the registered holders of the Warrants, as their respective rights or interests may appear.


 


15.7         The
Warrant Agent, and any stockholder, director, officer or employee of it, may buy, sell or deal in any of the Warrants or other
securities of the Company or become pecuniarily interested in any transaction in which the Company may be interested, or contract
with or lend money to the Company or otherwise act as fully and freely as though it were not Warrant Agent under this Agreement.  Nothing
herein precludes the Warrant Agent from acting in any other capacity for the Company or for any other legal entity.


 


15.8         The
Warrant Agent shall act hereunder solely as agent for the Company, and its duties are determined solely by the provisions hereof.  The
Warrant Agent shall not be liable for anything that it does or refrains from doing in connection with this Agreement except for
its own negligence, willful misconduct, or bad faith.  The Warrant Agent is not be liable for any error of judgment made
in good faith by it, unless it is proved that the Warrant Agent was negligent in ascertaining the pertinent facts.  Notwithstanding
anything in this Agreement to the contrary, in no event is the Warrant Agent liable for special, indirect, punitive or consequential
loss or damage of any kind whatsoever (including but not limited to lost profits), even if the Warrant Agent has been advised of
the likelihood of the loss or damage and regardless of the form of the action.


 



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15.9         The
Warrant Agent is not required to make or cause to be made any adjustment of the Exercise Price or number of the Warrant Shares
or other securities or property deliverable as provided in this Agreement, or to determine whether any facts exist which may require
any of such adjustments, or with respect to the nature or extent of any such adjustments, when made, or with respect to the method
employed in making the same.  The Warrant Agent is not accountable with respect to the validity or value or the kind
or amount of any Warrant Shares or of any securities or property which may at any time be issued or delivered upon the exercise
of any Warrant or with respect to whether any such Warrant Shares or other securities will when issued be validly issued and fully
paid and nonassessable, and makes no representation with respect thereto.


 


15.10         Notwithstanding
anything in this Agreement to the contrary, neither the Company nor the Warrant Agent has any liability to any holder of a Warrant
Certificate or other Person as a result of its inability to perform any of its obligations under this Agreement by reason of any
preliminary or permanent injunction or other order, decree or ruling issued by a court of competent jurisdiction or by a governmental,
regulatory or administrative agency or commission, or any statute, rule, regulation or executive order promulgated or enacted by
any governmental authority prohibiting or otherwise restraining performance of such obligation; provided that (i) the Company shall
use commercially reasonable best efforts to have any such order, decree or ruling lifted or otherwise overturned as soon as possible
and (ii) nothing in this Section 15.10 affects the Company’s obligation under Section 6.4 to use commercially reasonable
best efforts to have a registration statement in effect covering the Warrant Shares issuable upon exercise of the Warrants and
to maintain a current prospectus relating to those Warrant Shares.


 


15.11         Any
application by the Warrant Agent for written instructions from the Company may, at the option of the Warrant Agent, set forth in
writing any action proposed to be taken or omitted by the Warrant Agent under this Agreement and the date on and/or after which
such action shall be taken or such omission shall be effective.  The Warrant Agent shall not be liable for any action
taken by, or omission of, the Warrant Agent in accordance with a proposal included in such application on or after the date specified
in such application (which date must not be less than three Business Days after the date any officer of the Company actually receives
such application, unless any such officer has consented in writing to any earlier date) unless prior to taking any such action
(or the effective date in the case of an omission), the Warrant Agent has received written instructions in response to such application
specifying the action to be taken or omitted.


 


15.12         Warrant
Agent is not required to expend or risk its own funds or otherwise incur any financial liability in the performance of any of its
duties hereunder or in the exercise of its rights.


 


15.13         In
addition to the foregoing, the Warrant Agent is protected and does not incur liability for, or in respect of, any action taken
or omitted by it in connection with its administration of this Agreement if such acts or omissions are not the result of the Warrant
Agent’s reckless disregard of its duty, gross negligence or willful misconduct and are in reliance upon (i) the proper execution
of the certification concerning beneficial ownership appended to the form of assignment and the form of the election attached hereto
unless the Warrant Agent has actual knowledge that, as executed, such certification is untrue, or (ii) the non-execution of such
certification including, without limitation, any refusal to honor any otherwise permissible assignment or election by reason of
such non-execution.


 



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SECTION
16.         Change of Warrant Agent.  The Warrant Agent may
at any time resign as Warrant Agent upon written notice to the Company.  If the Warrant Agent becomes incapable of acting
as Warrant Agent, the Company shall appoint a successor to such Warrant Agent.  If the Company fails to make such appointment
within a period of 60 days after it has been notified in writing of such resignation or of such incapacity by the Warrant Agent
or by the registered holder of a Warrant Certificate, then the registered holder of any Warrant Certificate or the Warrant Agent
may apply, at the expense of the Company, to any court of competent jurisdiction for the appointment of a successor to the Warrant
Agent.  Pending appointment of a successor to such Warrant Agent, either by the Company or by such a court, the duties
of the Warrant Agent shall be carried out by the Company.  The holders of a majority of the unexercised Warrants may
at any time remove the Warrant Agent and appoint a successor to such Warrant Agent.  If a Successor Warrant Agent is
not appointed within 60 days of such removal, the Warrant Agent may apply, at the expense of the Company, to any court of competent
jurisdiction for the appointment of a successor to the Warrant Agent.  Such successor to the Warrant Agent need not
be approved by the Company or the former Warrant Agent.  After appointment the successor to the Warrant Agent will be
vested with the same powers, rights, duties and responsibilities as if it had been originally named as Warrant Agent without further
act or deed; but the former Warrant Agent upon payment of all fees and expenses due it and its agents and counsel shall deliver
and transfer to the successor to the Warrant Agent any property at the time held by it hereunder and execute and deliver any further
assurance, conveyance, act or deed necessary for the purpose.  Failure to give any notice provided for in this Section
16, however, or any defect therein, will not affect the legality or validity of the appointment of a successor to the Warrant
Agent.


 


SECTION
17.         Notices to Company and Warrant Agent.


 


17.1         Any
notice or demand authorized by this Agreement to be given or made by the Warrant Agent or by the registered holder of any Warrant
Certificate to or on the Company is sufficiently given or made when and if deposited in the mail, first class or registered, postage
prepaid, addressed (until another address is filed in writing by the Company with the Warrant Agent), as follows:


 


Selway Capital Acquisition Corporation

74 Grand Avenue

2 nd Floor

Englewood, NJ 07631

Fax No.:  (201) 541-1084

Attention:  Chief Executive Officer


 


17.2         If
the Company fails to maintain such office or agency or fails to give such notice of the location or of any change in the location
thereof, presentations may be made and notices and demands may be served at the principal corporate trust office of the Warrant
Agent.


 


17.3         Any
notice pursuant to this Agreement to be given by the Company or by the registered holder(s) of any Warrant Certificate to the Warrant
Agent is sufficiently given when and if deposited in the mail, first-class or registered, postage prepaid, addressed (until another
address is filed in writing by the Warrant Agent with the Company) to the Warrant Agent as follows:


 



    	20



    	 



    

 


American Stock Transfer & Trust Company, LLC

6201 15th Avenue

Brooklyn, NY 11219

Fax: (718) 921-8355

Attention:  Compliance Department


 


SECTION
18.         Supplements and Amendments.  The Company and
the Warrant Agent may from time to time supplement or amend this Agreement without the approval of any holders of Warrant Certificates
in order to cure any ambiguity or to correct or supplement any provision contained herein which is defective or inconsistent with
any other provision herein, or to make any other provisions in regard to matters or questions arising hereunder which the Company
and the Warrant Agent may deem necessary or desirable and which do not in any way adversely affect the interests of the holders
of Warrant Certificates theretofore issued.  Upon the delivery of a certificate from an appropriate officer of the Company
that states that the proposed supplement or amendment is in compliance with the terms of this Section 18, the Warrant Agent shall
execute such supplement or amendment.  Notwithstanding anything in this Agreement to the contrary, the prior written
consent of the Warrant Agent must be obtained in connection with any supplement or amendment that alters the rights or duties
of the Warrant Agent.  The Company and the Warrant Agent may amend any provision herein with the consent of the holders
of Warrants exercisable for a majority of the Warrant Shares issuable on exercise of all outstanding Warrants; provided that any
amendment affecting the Public Warrants must be approved by the holders of a majority of the Public Warrants.  Without
limiting the generality of the foregoing, prior to the issuance of any Public Warrants, this Agreement (including the exhibits
hereto) may be amended by the Company and the Warrant Agent, without the consent of any holder of Placement Warrants, to modify
in any way or provide for the terms of the Public Warrants.


 


SECTION
19.         Successors.  All the covenants and provisions
of this Agreement by or for the benefit of the Company or the Warrant Agent bind and inure to the benefit of their respective
successors and assigns hereunder.


 


SECTION
20.         Termination.  This Agreement terminates on any
earlier date if all Warrants have been exercised or expire without exercise.  The provisions of Section 15 hereof shall
survive such termination.


 


SECTION
21.         Governing Law.  The laws of the State of New
York govern this Agreement and each Warrant Certificate issued hereunder without regard to conflicts of laws principles.  The
parties agree that all actions and proceedings arising out of this Agreement or any of the transactions contemplated hereby, shall
be brought in the United States District Court for the Southern District of New York or in a New York State Court in the County
of New York and that, in connection with any such action or proceeding, submit to the jurisdiction of, and venue in, such court.  Each
of the parties hereto also irrevocably waives all right to trial by jury in any action, proceeding or counterclaim arising out
of this Agreement or the transactions contemplated hereby.


 



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SECTION
22.         Benefits of This Agreement.  Nothing in this
Agreement is to be construed to give to any person or corporation other than the Company, the Warrant Agent and the registered
holders of the Warrant Certificates any legal or equitable right, remedy or claim under this Agreement, and this Agreement is
for the sole and exclusive benefit of the Company, the Warrant Agent and the registered holders of the Warrant Certificates.


 


SECTION
23.         Counterparts.  This Agreement may be executed
in any number of counterparts and each of such counterparts is for all purposes to be deemed an original, and all such counterparts
together constitute but one and the same instrument.


 


SECTION
24.         Force Majeure.  The Warrant Agent is not responsible
or liable for any failure or delay in the performance of its obligations under this Agreement arising out of or caused by, directly
or indirectly, forces beyond its reasonable control, including without limitation strikes, work stoppages, accidents, acts of
war or terrorism, civil or military disturbances, nuclear or natural catastrophes or acts of God, and interruptions, loss or malfunctions
of utilities, communications or computer (software or hardware) services.


 


[Signature page follows]


 



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IN WITNESS WHEREOF,
the parties hereto have caused this Agreement to be duly executed as of the date first written above.


	 	
        SELWAY CAPITAL ACQUISITION

        CORPORATION

	 	 
	 	By:	/s/ Yaron Eitan
	 	Name:	Yaron Eitan
	 	Title:	Chief Executive Officer


 


	AMERICAN STOCK TRANSFER & TRUST COMPANY, LLC,  as Warrant Agent	 
	 	 
	By:	/s/ Felix Orihuela	 
	Name:	Felix Orihuela	 
	Title:	Vice President	 


 


Warrant
Agreement


 



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EXHIBIT A


 


[Form of Public and Placement Warrant
Certificate]


 


	NUMBER	WARRANTS


__________-


 


THIS WARRANT WILL BE VOID IF NOT EXERCISED
PRIOR TO 5:00 P.M.

NEW YORK CITY TIME, NOVEMBER 7, 2016


 


SELWAY CAPITAL ACQUISITION CORPORATION


 


CUSIP __________


 


WARRANT


This Warrant Certificate
certifies that ________________________, or registered assigns, is the registered holder of __________ warrants (the “Warrants”)
to purchase shares of common stock, $0.0001 par value (the “Common Stock”), of Selway Capital Acquisition Corporation,
a Delaware corporation (the “Company”).  Each Warrant entitles the holder, upon exercise during the period
set forth in the Warrant Agreement referred to below, to receive from the Company that number of fully paid and nonassessable shares
of Common Stock (each, a “Warrant Share”) as set forth below at the exercise price (the “Exercise Price”)
as determined pursuant to the Warrant Agreement payable in lawful money of the United States of America upon surrender of this
Warrant Certificate and payment of the Exercise Price at the office or agency of the Warrant Agent, but only subject to the conditions
set forth herein and in the Warrant Agreement.


 


Each Warrant is initially
exercisable for one share of Common Stock.  The number of Warrant Shares issuable upon exercise of the Warrants are subject
to adjustment upon the occurrence of certain events set forth in the Warrant Agreement.


 


The initial Exercise
Price per share of Common Stock for any Warrant is equal to $7.50 per share.  The Exercise Price is subject to adjustment
upon the occurrence of certain events set forth in the Warrant Agreement.


 


Warrants may be exercised
only during the Warrant Exercise Period subject to the conditions set forth in the Warrant Agreement and to the extent not exercised
by the end of such Warrant Exercise Period such Warrants shall become void.


 


The Company reserves
the right to redeem the Warrant, in whole and not in part, at any time prior to its exercise, with a notice of redemption in writing
to the holders of record of the Warrant, giving 30 days’ notice of such call at any time after the Warrant becomes exercisable
if (i) the last sale price of the Common Stock has been at least $17.50 per share on each of 20 trading days within any 30 trading
day period ending on the third trading day prior to the date on which notice of such redemption is given and (ii) at
all times between the date of such notice of redemption and the redemption date a registration statement is in effect covering
the Warrant Shares issuable upon exercise of the Warrants and a current prospectus relating to those Warrant Shares is available.
The redemption price of the Warrants shall be $.01 per Warrant. Any Warrant either not exercised or tendered back to the Company
by the end of the date specified in the notice of redemption shall be cancelled on the books of the Company and have no further
value except for the $.01 redemption price.


 


Reference is hereby
made to the further provisions of this Warrant Certificate set forth on the reverse hereof and such further provisions shall for
all purposes have the same effect as though fully set forth at this place.


 


This Warrant Certificate
shall not be valid unless countersigned by the Warrant Agent, as such term is used in the Warrant Agreement.


 



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This Warrant Certificate
shall be governed and construed in accordance with the internal laws of the State of New York, without regard to conflicts of laws
principles thereof.


  


	 	SELWAY CAPITAL ACQUISITION CORPORATION


 


	 	By: 	 
	 	Name:	 
	 	Title: 	President


 


	 	By: 	 
	 	Name:	 
	 	Title: 	Secretary


 


	Countersigned:	 
	Dated: ________, 20__	 
	AMERICAN STOCK TRANSFER & TRUST COMPANY , LLC,	 
	as Warrant Agent	 
	 	 	 	 
	By	 	Authorized Signatory	 




 



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[Form of Warrant Certificate]


 


[Reverse]


 


The Warrants evidenced by this Warrant
Certificate are part of a duly authorized issue of Warrants entitling the holder on exercise to receive shares of common stock,
par value $0.0001 per share, of the Company (the “Common Stock”), and are issued or to be issued pursuant to a Warrant
Agreement dated as of November 7, 2011 (the “Warrant Agreement”), duly executed and delivered by the Company to American
Stock Transfer & Trust Company, LLC, a limited liability trust company, as warrant agent (the “Warrant Agent”),
which Warrant Agreement is hereby incorporated by reference in and made a part of this instrument and is hereby referred to for
a description of the rights, limitation of rights, obligations, duties and immunities thereunder of the Warrant Agent, the Company
and the holders (the words “holders” or “holder” meaning the registered holders or registered holder) of
the Warrants.  A copy of the Warrant Agreement may be obtained by the holder hereof upon written request to the Company.  Defined
terms used in this Warrant Certificate but not defined herein shall have the meanings given to them in the Warrant Agreement.


 


Warrants may be exercised
at any time during the Warrant Exercise Period set forth in the Warrant Agreement.  The holder of Warrants evidenced
by this Warrant Certificate may exercise them by surrendering this Warrant Certificate, with the form of election to purchase set
forth hereon properly completed and executed, together with payment of the Exercise Price as specified in the Warrant Agreement
at the principal corporate trust office of the Warrant Agent.  In the event that upon any exercise of Warrants evidenced
hereby the number of Warrants exercised shall be less than the total number of Warrants evidenced hereby, there shall be issued
to the holder hereof or his assignee a new Warrant Certificate evidencing the number of Warrants not exercised.  No adjustment
shall be made for any dividends on any Common Stock issuable upon exercise of this Warrant.


 


Notwithstanding anything
else in this Warrant Certificate or the Warrant Agreement, no Warrant may be exercised unless at the time of exercise (i) a registration
statement covering the Warrant Shares to be issued upon exercise of the Public Warrants is effective under the Securities Act of
1933, as amended, and (ii) a prospectus thereunder relating to such Warrant Shares is current.  In no event shall the
Warrants be settled on a net cash basis nor shall the Company be required to issue unregistered shares upon the exercise of any
Warrant that is not a Placement Warrant.


 


The Warrant Agreement
provides that upon the occurrence of certain events the number of Warrant Shares set forth on the face hereof may, subject to certain
conditions, be adjusted.  No fractions of a share of Common Stock will be issued upon the exercise of any Warrant, but
the Company will pay the cash value thereof determined as provided in the Warrant Agreement.


 


Warrant Certificates,
when surrendered at the principal corporate trust office of the Warrant Agent by the registered holder thereof in person or by
legal representative or attorney duly authorized in writing, may be exchanged, in the manner and subject to the limitations provided
in the Warrant Agreement, but without payment of any service charge, for another Warrant Certificate or Warrant Certificates of
like tenor evidencing in the aggregate a like number of Warrants.


 


Upon due presentation
for registration of transfer of this Warrant Certificate at the office of the Warrant Agent a new Warrant Certificate or Warrant
Certificates of like tenor and evidencing in the aggregate a like number of Warrants shall be issued to the transferee(s) in exchange
for this Warrant Certificate, subject to the limitations provided in the Warrant Agreement, without charge except for any tax or
other governmental charge imposed in connection therewith.


 


The Company and the
Warrant Agent may deem and treat the registered holder(s) thereof as the absolute owner(s) of this Warrant Certificate (notwithstanding
any notation of ownership or other writing hereon made by anyone), for the purpose of any exercise hereof, of any distribution
to the holder(s) hereof, and for all other purposes, and neither the Company nor the Warrant Agent shall be affected by any notice
to the contrary.  Neither the Warrants nor this Warrant Certificate entitles any holder hereof to any rights of a stockholder
of the Company.


 



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Election to Purchase


 


(To Be Executed Upon Exercise Of Warrant)


 


The undersigned hereby
irrevocably elects to exercise the right, represented by this Warrant Certificate, to receive __________ shares of Common Stock
and herewith tenders payment for such shares to the order of Selway Capital Acquisition Corporation in the amount of $______ in
accordance with the terms hereof.  The undersigned requests that a certificate for such shares be registered in the name
of ________________, whose address is _______________________________ and that such shares be delivered to ________________ whose
address is ___________ ______________________.  If said number of shares is less than all of the Common Stock purchasable
hereunder, the undersigned requests that a new Warrant Certificate representing the remaining balance of such shares be registered
in the name of ______________, whose address is _________________________, and that such Warrant Certificate be delivered to _________________,
whose address is __________________.


 


Signature: _______________________


 


Date:  _____________, 20__


  


Signature Guaranteed:  _________________


 


 



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EXHIBIT B


 


LEGEND FOR PLACEMENT WARRANTS


 


THE SECURITIES REPRESENTED
BY THIS CERTIFICATE (INCLUDING THE SHARES  OF COMMON STOCK OF THE COMPANY ISSUABLE UPON EXERCISE OF SUCH SECURITIES)
HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED OR ANY STATE SECURITIES LAWS, AND MAY NOT BE OFFERED, SOLD,
TRANSFERRED OR OTHERWISE DISPOSED OF UNLESS REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND ANY APPLICABLE STATE SECURITIES
LAWS OR AN EXEMPTION FROM REGISTRATION IS AVAILABLE.  IN ADDITION, THE SECURITIES REPRESENTED BY THIS CERTIFICATE ARE
SUBJECT TO CERTAIN TRANSFER RESTRICTIONS SET FORTH IN THE WARRANT AGREEMENT REFERRED TO HEREIN.


 


SECURITIES EVIDENCED
BY THIS CERTIFICATE AND COMMON STOCK OF THE COMPANY ISSUABLE UPON EXERCISE OF SUCH SECURITIES WILL BE ENTITLED TO REGISTRATION
RIGHTS UNDER A REGISTRATION RIGHTS AGREEMENT TO BE EXECUTED BY THE COMPANY.


 


THE SHARES REPRESENTED
BY THIS CERTIFICATE ARE SUBJECT TO THE TERMS AND CONDITIONS OF AN ESCROW AGREEMENT BY AND BETWEEN THE COMPANY AND THE HOLDER OF
THIS CERTIFICATE.  THESE SHARES MAY NOT BE SOLD EXCEPT IN COMPLIANCE WITH THAT AGREEMENT.


 


No. _____ _______ Warrants


 



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EXHIBIT C


 


Warrant Agent Fees


 


	Description	 	Amount ($)
	 	 	 
	Fee for acting as Warrant Agent	 	2,500


 



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