Blueprint






Exhibit 10.5







NEITHER THE ISSUANCE AND SALE OF THE SECURITIES REPRESENTED BY THIS
WARRANT NOR THE SECURITIES INTO WHICH THESE SECURITIES ARE
EXERCISABLE HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933,
AS AMENDED, OR APPLICABLE STATE SECURITIES LAWS. THE SECURITIES MAY
NOT BE OFFERED FOR SALE, SOLD, TRANSFERRED OR ASSIGNED (I) IN THE
ABSENCE OF (A) AN EFFECTIVE REGISTRATION STATEMENT FOR THE
SECURITIES UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR (B) AN
OPINION OF COUNSEL TO THE REGISTERED HOLDER (IF REQUESTED BY THE
COMPANY), IN A FORM REASONABLY ACCEPTABLE TO THE COMPANY, THAT
REGISTRATION IS NOT REQUIRED UNDER SAID ACT OR (II) UNLESS SOLD OR
ELIGIBLE TO BE SOLD PURSUANT TO RULE 144 OR RULE 144A UNDER SAID
ACT.


 


	

Warrant No.:
2017-_____

	

Number
of Shares: ________


	

Date
of Issuance: August 10, 2017

	

(subject to
adjustment)







 



 


______________________________________________________________________________________


 



ROOT9B HOLDINGS, INC.



A Delaware Corporation


______________________________________________________________________________________


 



Warrant


 


root9B
Holdings, Inc., a Delaware corporation (the “Company”),
for value received, hereby certifies that _____________ (the “Initial
Holder”), or its registered assigns (the Initial
Holder or such registered assigns shall be referred to as the
“Registered
Holder”), is entitled, subject to the terms set forth
below, to purchase from the Company at any time on or after the
Exercise Date (as hereinafter defined) and on or before the
Expiration Date (as hereinafter defined), in whole or in part,
________ shares (as adjusted
from time to time pursuant to the provisions of this Warrant) of
the Company’s common stock, $0.001 par value per share
(“Common
Stock”), at an Exercise Price equal to $10.00 per
share (the “Exercise
Price”). The shares purchasable upon exercise of this
Warrant are sometimes hereinafter referred to as the
“Warrant
Stock”. “Exercise
Date” means any date on or after December 31, 2017
(the “Initial Exercise
Date”) and prior to the Expiration Date on which the
Registered Holder elects by written notice to the Company to
exercise this Warrant. This Warrant is one of a series of Warrants
(the “August 2017
Warrants”) issued in connection with the issuance by
the Company to the Initial Holder of a secured convertible
promissory note due 2019.

 

1. Exercise.

 

(a) Manner
of Exercise. This Warrant may
be exercised by the Registered Holder, in whole or in part with the
purchase/exercise form appended hereto as Exhibit A (the
“Notice of
Exercise”) duly executed by such Registered Holder or
by such Registered Holder’s duly authorized attorney, at the
principal office of the Company, or at such other office or agency
as the Company may designate in writing, accompanied by payment in
full of the Exercise Price payable in respect of the number of
shares of Warrant Stock purchased upon such exercise. The Exercise
Price may be paid by cash, check, or wire transfer in immediately
available funds.

 

(b) Effective
Time of Exercise. Each exercise of
this Warrant shall be deemed to have been effected immediately
prior to the close of business as of the date the Warrant has been
exercised pursuant to a Notice of Exercise, with payment to the
Company of the Exercise Price and all transfer taxes required to be
paid by the Holder, if any, prior to the issuance of such shares,
having been paid. At such time, the person or persons in whose name
or names any certificates for Warrant Stock shall be issuable upon
such exercise as provided in Section 1(c) below shall be deemed to
have become the holder or holders of record of the Warrant Stock
represented by such certificates.

 

(c) Delivery
to Holder. As soon as
practicable after the exercise of this Warrant, in whole or in
part, and in any event within ten (10) calendar days thereafter,
the Company at its expense will cause to be issued in the name of,
and delivered to, the Registered Holder, or as such Registered
Holder (upon payment by such Registered Holder of any applicable
transfer taxes) may direct, certificates for Warrant Stock
purchased hereunder which shall be transmitted by the
Company’s transfer agent to the Registered Holder by (i)
crediting the account of the Registered Holder’s broker with
the Depository Trust Company through its Deposit Withdrawal Agent
Commission (“DWAC”)
system if the Company is then a participant in such system and
either (A) there is an effective registration statement permitting
the resale of the Warrant Stock by the Registered Holder or (B) the
Warrant Stock is eligible for resale without volume or
manner-of-sale limitations pursuant to Rule 144 of the Act, as
amended from time to time, or any similar rule or regulation
hereafter adopted by the SEC having substantially the same effect
as such Rule (“Rule
144”), or (ii) if the conditions specified in (i)(A)
or (i)(B) are not satisfied, by physical delivery to the address
specified by the Registered Holder in the Notice of
Exercise.

 



 







 





 

(d) Delivery of New Warrants Upon
Exercise. If this Warrant shall have been exercised in part,
the Company shall, at the request of the Registered Holder, at the
time of delivery of the certificate or certificates representing
the Warrant Stock, deliver to the Registered Holder a new Warrant
evidencing the rights of Registered Holder to purchase the
unpurchased Warrant Stock called for by this Warrant, which new
Warrant shall in all other respects be identical with this Warrant.
The Registered Holder shall not be required to deliver the original
of this Warrant in order to effect an exercise
hereunder.

 

(e) Limitations on Exercise. This
Warrant shall not be exercisable by the Registered Holder to the
extent (but only to the extent) that, following exercise, the
Registered Holder or any of its Affiliates would beneficially own
in excess of 9.99% (the “Maximum
Percentage”) of the Outstanding Shares of Common
Stock. No prior limitation on the number of shares of Common Stock
subject to this Warrant or the inability to exercise this Warrant
pursuant to this Section 1(e) shall have any effect on the
applicability of the provisions of this Section 1(e) with respect
to any subsequent determinations of the number of shares subject to
a Warrant or the exercisability hereof. For the purpose of this
Section 1(e), beneficial ownership and all determinations and
calculations (including, without limitation, with respect to
calculations of percentage ownership) shall be determined in
accordance with Section 13(d) of the Exchange Act. For
clarification, the foregoing calculation of beneficial ownership
shall take into account all securities which give rise to
beneficial ownership by the Registered Holder or its Affiliates of
such Common Stock under such rules and regulations and not solely
this Warrant. The provisions of this Section 1(e) shall be
implemented in a manner otherwise than in strict conformity with
the terms of this Section 1(e) in order to correct this Section
1(e) or any portion hereof which may be defective or inconsistent
with the intended Maximum Percentage beneficial ownership
limitation herein contained or to make changes or supplements
necessary or desirable to properly give effect to such Maximum
Percentage limitation. The limitations contained in this Section
1(e) shall apply to a successor holder of this Warrant.
“Affiliate”
means, with respect to any Person, any other Person that, directly
or indirectly through one or more intermediaries, Controls, is
controlled by or is under common control with such Person, as such
terms are used in and construed under Rule 405 under the Securities
Act. With respect to the Registered Holder, any investment fund or
managed account that is managed on a discretionary basis by the
same investment manager Registered Holder will be deemed to be an
Affiliate of Registered Holder. “Person”
means any individual, firm, corporation, partnership, limited
liability company, joint venture, association, joint stock company,
trust, unincorporated organization or government or any agency or
political subdivision thereof, or other entity of any kind and
includes any successor (by merger or otherwise) of such entity.
“Outstanding Shares
of Common Stock” means, as of any particular
measurement time, the sum of (i) the total number of outstanding
shares of Common Stock of the Company as of such time, and (ii) the
total number of shares of Common Stock which Registered Holder has
the right to acquire beneficial ownership of within sixty days of
such measurement time (to the extent not included in (i)),
including but not limited to any right to acquire shares of Common
Stock through the exercise of any option, warrant or right
(including this Warrant) or through the conversion of another
security. “Exchange
Act” means the Securities Exchange Act of 1934, as
amended, and the rules and regulations of the Securities and
Exchange Commission thereunder.

 

2. Adjustments.

 

(a) Stock
Splits and Dividends. If outstanding
shares of the Company’s Common Stock shall be subdivided into
a greater number of shares or a dividend in Common Stock shall be
paid in respect of Common Stock, then the Exercise Price in effect
immediately prior to such subdivision or at the record date of such
dividend shall simultaneously with the effectiveness of such
subdivision or immediately after the record date of such dividend
be proportionately reduced. If outstanding shares of Common Stock
shall be combined into a smaller number of shares, then the
Exercise Price in effect immediately prior to such combination
shall, simultaneously with the effectiveness of such combination,
be proportionately increased. When any adjustment is required to be
made in the Exercise Price, the number of shares of Warrant Stock
purchasable upon the exercise of this Warrant shall be changed to
the number determined by dividing (i) an amount equal to the
number of shares issuable upon the exercise of this Warrant
immediately prior to such adjustment, multiplied by the Exercise
Price in effect immediately prior to such adjustment, by
(ii) the Exercise Price in effect immediately after such
adjustment.

 



 

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(b) Reclassification,
Etc. As a condition of
the consummation of any Fundamental Transaction occurring at any
time while any portion of this Warrant remains outstanding, the
Company shall cause any Successor Entity in such Fundamental
Transaction to assume in writing all of the obligations of the
Company under this Warrant in accordance with the provisions of
this Section 2(b) pursuant to written agreements in form and
substance reasonably satisfactory to the Holder, including
agreements to deliver to the Holder in exchange for this Warrant a
security of the Successor Entity evidenced by a written instrument
substantially similar in form and substance to this Warrant,
including, without limitation, which is, at the time of
consummation of the Fundamental Transaction, exercisable into a
corresponding number of shares of capital stock of the Successor
Entity equivalent to the shares of Common Stock acquirable and
receivable upon exercise of this Warrant (without regard to any
limitations on the exercise of this Warrant) prior to such
Fundamental Transaction, and with an exercise price equal to the
Exercise Price (but taking into account the relative value of the
shares of Common Stock pursuant to such Fundamental Transaction and
the value of such shares of capital stock, such adjustments to the
number of shares of capital stock and such exercise price being for
the purpose of protecting the economic value of this Warrant
immediately prior to the consummation of such Fundamental
Transaction). Upon the consummation of each Fundamental
Transaction, the Successor Entity shall succeed to, and be
substituted for (so that from and after the date of the applicable
Fundamental Transaction, the provisions of this Warrant referring
to the “Company” shall refer instead to the Successor
Entity), and may exercise every right and power of the Company and
shall assume all of the obligations of the Company under this
Warrant with the same effect as if such Successor Entity had been
named as the Company herein. Notwithstanding anything to the
contrary, the Company or any Successor Entity shall, at the
Holder’s option, exercisable at any time concurrently with,
or within 30 days after, the consummation of the Fundamental
Transaction, (a) purchase all or any portion of this Warrant from
the Holder by paying to the Holder an amount of cash equal to the
Black Scholes Value of the remaining unexercised portion of such
Warrant on the date of such Fundamental Transaction or (b) deliver,
in exchange for surrender of this Warrant, the same amount and kind
of securities, cash or property as such Holder would have been
entitled to receive upon the occurrence of such Fundamental
Transaction if it had been, immediately prior to such Fundament
Transaction, the holder of the number of shares of Warrant Stock
then issuable upon exercise in full of the Warrant (without regard
to any limitations on the exercise of this Warrant).

 


"Fundamental
Transaction" means that the Company shall, directly or
indirectly, in one or more related transactions, (i) consolidate or
merge with or into (whether or not the Company is the surviving
corporation) another Person or Persons, if the holders of the
Voting Stock (not including any shares of Voting Stock held by the
Person or Persons making or party to, or associated or affiliated
with the Persons making or party to, such consolidation or merger)
immediately prior to such consolidation or merger shall hold or
have the right to direct the voting of less than 50% of the Voting
Stock or such voting securities of such other surviving Person
immediately following such transaction, or (ii) sell, assign,
transfer, convey or otherwise dispose of all or substantially all
of the properties or assets of the Company (other than the sale of
IPSA International, Inc., the Company’s wholly-owned
subsidiary (“IPSA”),
or any assets related to IPSA) to another Person, or (iii) allow
another Person to make a purchase, tender or exchange offer that is
accepted by the holders of more than the 50% of the outstanding
shares of Voting Stock of the Company (not including any shares of
Voting Stock held by the Person or Persons making or party to, or
associated or affiliated with the Persons making or party to, such
purchase, tender or exchange offer) (other than the acquisition of
the Voting Stock of IPSA), or (iv) consummate a stock purchase
agreement or other business combination (including, without
limitation, a reorganization, recapitalization, spin-off or scheme
of arrangement) with another Person whereby such other Person
acquires more than the 50% of the outstanding shares of Voting
Stock of the Company (not including any shares of Voting Stock held
by the other Person or other Persons making or party to, or
associated or affiliated with the other Persons making or party to,
such stock purchase agreement or other business combination) (other
than a sale of the Voting Stock of IPSA), (v) reorganize,
recapitalize or reclassify its Common Stock (other than pursuant to
the Amendment, if approved) or (vi) any "person" or "group" (as
these terms are used for purposes of Sections 13(d) and 14(d) of
the Securities Exchange Act of 1934, as amended) is or shall become
the "beneficial owner" (as defined in Rule 13d-3 under the
Securities Exchange Act of 1934, as amended), directly or
indirectly, of 50% of the aggregate ordinary voting power
represented by issued and outstanding Common Stock.

 



 

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“Successor
Entity” means the Person formed by, resulting from or
surviving any Fundamental Transaction or the Person with which such
Fundamental Transaction shall have been entered into.

 


"Voting
Stock" of a Person means capital stock of such Person of the
class or classes pursuant to which the holders thereof have the
general voting power to elect, or the general power to appoint, at
least a majority of the board of directors, managers or trustees of
such Person (irrespective of whether or not at the time capital
stock of any other class or classes shall have or might have voting
power by reason of the happening of any contingency).

 

(c) Adjustment Certificate. When
any adjustment is required to be made in the Warrant Stock or the
Exercise Price pursuant to this Section 2, the Company shall
promptly mail to the Registered Holder a certificate setting forth
(i) a brief statement of the facts requiring such adjustment,
(ii) the Exercise Price after such adjustment and
(iii) the kind and amount of stock or other securities or
property into which this Warrant shall be exercisable after such
adjustment.

 

3. Transfers.

 

(a) Unregistered
Security. Each Registered
Holder acknowledges that this Warrant and the Warrant Stock have
not been registered under the Securities Act of 1933, as amended
(the “Act”),
and agrees not to sell, pledge, distribute, offer for sale,
transfer or otherwise dispose of this Warrant or any Warrant Stock
issued upon its exercise in the absence of (i) an effective
registration statement under the Act as to this Warrant or such
Warrant Stock and registration or qualification of this Warrant or
such Warrant Stock under any applicable U.S. federal or state
securities law then in effect or (ii) an opinion of counsel,
reasonably satisfactory to the Company, that such registration or
qualification is not required. Each certificate or other instrument
for Warrant Stock issued upon the exercise of this Warrant shall
bear a legend substantially to the foregoing effect.


 

(b) Transferability.
Subject to the provisions of Section 3(a) hereof, this
Warrant and all rights hereunder are transferable, in whole or in
part, upon surrender of the Warrant with a properly executed
assignment (in the form of Exhibit B
hereto) at the principal office of the Company. The Company shall,
upon receipt of a transfer notice and appropriate documentation,
register any transfer on the Company’s warrant register;
provided, however, that the Company may require, as a condition to
such transfer, an opinion reasonably satisfactory to the Company
that said transfer does not require registration pursuant to one or
more exemptions provided under the Act.

 

(c) Warrant
Register. The Company will
maintain a register containing the names and addresses of the
Registered Holders of this Warrant. Until any transfer of this
Warrant is made in the warrant register, the Company may treat the
Registered Holder of this Warrant as the absolute owner hereof for
all purposes; provided, however, that if this Warrant
is properly assigned in blank, the Company may (but shall not be
required to) treat the bearer hereof as the absolute owner hereof
for all purposes, notwithstanding any notice to the contrary. Any
Registered Holder may change such Registered Holder’s address
as shown on the warrant register by written notice to the Company
requesting such change.

 

4. No Impairment. The Company will
not, by amendment of its charter or through reorganization,
consolidation, merger, dissolution, sale of assets or any other
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 action as may be necessary or
appropriate in order to protect the rights of the holder of this
Warrant against impairment. Notwithstanding any other provision of
this Agreement to the contrary (including by way of implication),
the Company (a) will not increase the par value of any shares of
Common Stock receivable on the exercise of any Warrant above the
amount payable therefor on such exercise and (b) will take all such
action as may be necessary or appropriate so that the Company may
validly and legally issue fully paid and nonassessable shares of
Common Stock on the exercise of any Warrant. The Company covenants
and agrees that it shall not, without the prior written consent of
the Registered Holder, enter into or agree to become subject to any
term, condition, provision or agreement that would restrict in any
material way the performance of the Company’s obligations
under this Agreement. The Company represents to each Holder that
the Company is not subject to or bound by any such term, condition,
provision or agreement as of the date hereof.

 



 

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5. Termination. This
Warrant (and the right to purchase securities upon exercise hereof)
shall terminate five (5) years from the date of issuance of this
Warrant (the “Expiration
Date”).

 

6. Notices of Certain
Transactions. In case:

 

(a) the Company shall
take a record of the holders of its Common Stock (or other stock or
securities at the time deliverable upon the exercise of this
Warrant) for the purpose of entitling or enabling them to receive
any dividend or other distribution, or to receive any right to
subscribe for or purchase any shares of stock of any class or any
other securities, or to receive any other right, to subscribe for
or purchase any shares of stock of any class or any other
securities, or to receive any other right, or

 

(b) of any
reclassification of the capital stock of the Company,
or

 

(c) of the voluntary or
involuntary dissolution, liquidation or winding-up of the Company
((a), (b) and (c) of this Section 6 being referred to herein as a
“Liquidation
Event”), then, and in each such case, the Company will
mail or cause to be mailed to the Registered Holder of this Warrant
a notice specifying, as the case may be, (i) the date on which
a record is to be taken for the purpose of such dividend,
distribution or right, and stating the amount and character of such
dividend, distribution or right, or (ii) the effective date on
which such reclassification, dissolution, liquidation or winding-up
is to take place, and the time, if any is to be fixed, as of which
the holders of record of Common Stock (or such other stock or
securities at the time deliverable upon such reclassification,
dissolution, liquidation or winding-up) are to be determined. Such
notice shall be mailed at least ten (10) days prior to the record
date or effective date for the event specified in such notice.
Failure to so notify a Registered Holder shall not invalidate any
such action.

 

7. Reservation of
Stock.

 

(a) Notwithstanding
anything herein to the contrary, the Registered Holder acknowledges
and agrees that this Warrant may not be exercised if, at the time
of such exercise, the Company does not have a sufficient number of
authorized shares of Common Stock pursuant to the Company’s
Certificate of Incorporation (the “Certificate of
Incorporation”), as in effect as of such date, to
cover such issuance. The Company will at all times reserve and keep
available out of its authorized but unissued stock, solely for the
issuance and delivery upon the exercise of this Warrant and other
similar Warrants, and free of preemptive rights, such number of its
duly authorized shares of Common Stock as from time to time shall
be issuable upon the exercise in full of this Warrant and other
similar Warrants without regard to any limitation on exercise set
forth herein or therein. All of the shares of Common Stock issuable
upon exercise of this Warrant and other similar Warrants, when
issued and delivered in accordance with the terms hereof and
thereof, will be duly authorized, validly issued, fully paid and
non-assessable, subject to no lien or other encumbrance other than
restrictions on transfer arising under applicable securities laws
and restrictions imposed by Section 3 hereof.

 

(b) [Reserved.]

 

8. Exchange of Warrants. Upon the
surrender by the Registered Holder of any Warrant or Warrants,
properly endorsed, to the Company at the principal office of the
Company, the Company will, subject to the provisions of Section 3
hereof, issue and deliver to or upon the order of such Registered
Holder, at the Company’s expense, a new Warrant or Warrants
of like tenor, in the name of such Registered Holder or as such
Registered Holder (upon payment by such Registered Holder of any
applicable transfer taxes) may direct, calling in the aggregate on
the face or faces thereof for the number of shares of Common Stock
called for on the face or faces of the Warrant or Warrants so
surrendered.

 

9. Replacement of Warrants. Upon
receipt of evidence reasonably satisfactory to the Company of the
loss, theft, destruction or mutilation of this Warrant and (in the
case of loss, theft or destruction) upon delivery of an indemnity
agreement (with surety if reasonably required) in an amount
reasonably satisfactory to the Company, or (in the case of
mutilation) upon surrender and cancellation of this Warrant, the
Company will issue, in lieu thereof, a new Warrant of like
tenor.

 



 

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10. Notices.
All notices, demands, requests,
consents, approvals, and other communications required or permitted
hereunder shall be in writing and, unless otherwise specified
herein, shall be (i) personally served, (ii) deposited in the mail,
registered or certified, return receipt requested, postage prepaid,
(iii) delivered by reputable air courier service with charges
prepaid, or (iv) transmitted by hand delivery, electronic mail or
facsimile, addressed as set forth below or to such other address as
such party shall have specified most recently by written notice.
Any notice or other communication required or permitted to be given
hereunder shall be deemed effective (a) upon hand delivery,
electronic mail or delivery by facsimile, with accurate
confirmation generated by the transmitting facsimile machine, if
sent by electronic mail with confirmed receipt, at the address or
number designated below (if delivered on a business day during
normal business hours where such notice is to be received), or the
first business day following such delivery (if delivered other than
on a business day during normal business hours where such notice is
to be received) or (b) on the second business day following the
date of mailing by express courier service, fully prepaid,
addressed to such address, or upon actual receipt of such mailing,
whichever shall first occur.

 



If to the
Company:          



root9B Holdings,
Inc.

102 N.
Cascade Avenue, Suite 220

Colorado Springs,
CO 80919

Attn:
Chief Financial Officer















If to the Registered
Holder: 

At the address
provided by the Registered Holder.





 

11. No Rights as Stockholder. Until
the exercise of this Warrant, the Registered Holder of this Warrant
shall not have or exercise any rights by virtue hereof as a
stockholder of the Company, and this Warrant shall not impose on
the Registered Holder any obligation to purchase any securities or
impose any liability on such Registered Holder as a stockholder
whether such obligation or liabilities are asserted by the Company
or creditors of the Company.

 

12. Representations of Registered
Holder. The Registered Holder hereby represents and
acknowledges to the Company that:

 

(a) It understands that
this Warrant and the Warrant Stock will be “restricted securities” as
such term is used in the rules and regulations under the Act and
that such securities have not been and will not be registered under
the Act or any state securities law, and that such securities must
be held indefinitely unless registration is effected or transfer
can be made pursuant to appropriate exemptions;

 

(b) the Registered
Holder has read, and fully understands, the terms of this Warrant
set forth on its face and the attachments hereto, including the
restrictions on transfer contained herein;

 

(c) the Registered
Holder is purchasing for investment for its own account and not
with a view to or for sale in connection with any distribution of
this Warrant and the Warrant Stock and it has no intention of
selling such securities in a public distribution in violation of
the federal securities laws or any applicable state securities
laws; provided that nothing contained herein will prevent the
Registered Holder from transferring such securities in compliance
with the terms of this Warrant and the applicable federal and state
securities laws; and

 

(d) the Company may
affix the following legend (in addition to any other legend(s), if
any, required by applicable state corporate and/or securities laws)
to certificates for shares issued upon exercise of this
Warrant:

 


“These
securities have not been registered under the Securities Act of
1933, as amended. They may not be sold, offered for sale, pledged
or hypothecated in the absence of a registration statement in
effect with respect to the securities under such Act or an opinion
of counsel satisfactory to the Company that such registration is
not required or unless sold pursuant to Rule 144 of such
Act.”

 



 

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13. No Fractional Shares. No
fractional shares will be issued in connection with any exercise
hereunder. In lieu of any fractional shares which would otherwise
be issuable, the Company shall pay cash equal to the product of
such fraction multiplied by the fair market value of one such share
on the date of exercise, as determined in good faith by the
Company’s Board of Directors.

 

14. Securities Law Reporting
Requirements. The Company covenants and agrees that it will
comply with the reporting requirements of Sections 13 and 15(d) of
the Exchange Act and will comply with all other public information
reporting requirements of the Securities and Exchange Commission
(including Rule 144 promulgated under the Securities Act) from time
to time in effect and applicable to the Company and relating to the
availability of an exemption from the Securities Act for the sale
of restricted securities.

 

15. Amendment or Waiver. Any term
of this Warrant may be amended or waived upon written consent of
the Company and the Registered Holder. No consideration shall be
offered or paid to the Registered Holder or to the initial holder
or registered assigns of any warrant to purchase Common Stock
(other than this Warrant) issued by the Company pursuant to the
Purchase Agreement (the "Other Warrants") to amend or consent to a
waiver or modification of any provision of this Warrant and/or the
Other Warrants unless the same consideration is also offered to the
Registered Holder and all initial holders or registered assigns of
the Other Warrants.

 

16. Entire
Agreement. This Warrant
constitutes the entire agreement between the parties hereto
pertaining to the subject matter hereof, and any and all other
written or oral agreements relating to the subject matter hereof
existing between the parties hereto are expressly
canceled.

 

17. Headings. The headings in this
Warrant are for purposes of reference only and shall not limit or
otherwise affect the meaning of any provision of this
Warrant.

 

18. Governing Law. All questions
concerning the construction, validity, enforcement and
interpretation of this Agreement shall be governed by and construed
and enforced in accordance with the internal laws of the State of
Delaware, without regard to the principles of conflicts of law
thereof. Each party agrees that all proceedings concerning the
interpretations, enforcement and defense of the transactions
contemplated by this Agreement shall be commenced exclusively in
courts of the State of Delaware (the “Delaware
Courts”). Each party hereto hereby irrevocably submits
to the exclusive jurisdiction of the Delaware Courts for the
adjudication of any dispute hereunder or in connection herewith or
with any transaction contemplated hereby or discussed herein, and
hereby irrevocably waives, and agrees not to assert in any
proceeding, any claim that it is not personally subject to the
jurisdiction of any such Delaware Court, or that such proceeding
has been commenced in an improper or inconvenient forum. Each party
hereto hereby irrevocably waives personal service of process and
consents to process being served in any such proceeding by mailing
a copy thereof via registered or certified mail or overnight
delivery (with evidence of delivery) to such party at the address
in effect for notices to it under this Agreement and agrees that
such service shall constitute good and sufficient service of
process and notice thereof. Nothing contained herein shall be
deemed to limit in any way any right to serve process in any manner
permitted by law. EACH PARTY HERETO HEREBY IRREVOCABLY WAIVES, TO
THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY AND ALL RIGHT
TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING
TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED
HEREBY.


 

19. More Favorable Terms. So long
as this Warrant remains outstanding, if after the date hereof the
Company amends the terms of any of the August 2017 Warrants or the
warrants issued in connection with the Securities Purchase
Agreement, dated as of September 9, 2016, as amended, by and among
the Company and the investors referred to therein (the
“2016 SPA
Warrants” and, together with the August 2017 Warrants,
the “Secured
Warrants”) and such amendment to the Secured Warrants
has terms and conditions that are, individually or in the
aggregate, more favorable than the terms and conditions granted to
the Holder hereunder, then this Warrant shall be deemed to
immediately be amended as of the date of such Secured Warrant
amendment to reflect substantially equivalent terms and conditions
to the Holder hereunder. For purposes of this Section 19, the
determination regarding whether any such terms and conditions are
more favorable than those granted hereunder shall be made by the
Company’s Board of Directors in its reasonable good faith
judgment.


 



 

7







 






 

20. Registration
Rights.


 

(a) At any time on or
prior to December 31, 2017, the Company shall file a registration
statement covering the resale of the Warrants Stock by the Holder.
The Company shall use its commercially reasonable efforts to cause
the registration statement to be declared effective by the
Securities and Exchange Commission as promptly as possible after
the filing thereof and shall use commercially reasonable efforts to
keep the registration statement continuously effective under the
Securities Act until the earlier of (i) the date that all
securities covered by such registration statement have been sold or
may be sold without volume or manner-of-sale restrictions pursuant
to Rule 144 and without the requirement for the Company to be in
compliance with the current public information requirement under
Rule 144 or (ii) the Expiration Date. The Company shall notify the
Purchasers in writing promptly (and in any event within two
business days) after receiving notification from the Securities and
Exchange Commission that the Registration Statement has been
declared effective.


 

(b) The Company may, by
written notice to Holder, suspend sales under the registration
statement after the effective date thereof and/or require that
Holder immediately cease the sale of shares of Common Stock
pursuant thereto and/or defer the filing of the registration
statement if the Company is engaged in a material merger,
acquisition or sale or any other pending development that the
Company believes may be material, and the Board of Directors
determines in good faith, by appropriate resolutions, that, as a
result of such activity, (A) it would be materially detrimental to
the Company (other than as relating solely to the price of the
Common Stock) to maintain the registration statement at such time
or (B) it is in the best interests of the Company to suspend sales
under such registration at such time. Upon receipt of such notice,
Holder agrees to immediately discontinue any sales of Warrant Stock
pursuant to the registration statement until Holder is advised in
writing by the Company that the current prospectus or amended
prospectus, as applicable, may be used. In no event, however, shall
this right be exercised to suspend sales beyond the period during
which (in the good faith determination of the Board of Directors)
the failure to require such suspension would be materially
detrimental to the Company. The Company’s rights under this
Section 20(b) may be exercised for a period of no more than 20
business days at a time with a subsequent permitted trading window
of at least 90 business days, and not more than two times in any
twelve-month period. Immediately after the end of any suspension
period under this Section 20(b), the Company shall take all
necessary actions (including filing any required supplemental
prospectus) to restore the effectiveness of the registration
statement and the ability of Holder to publicly resell the Warrant
Stock pursuant to the effective registration
statement.


 

(c) All expenses, other
than underwriting discounts and commissions relating to the Warrant
Stock and the fees and disbursements of any counsel for Holder,
incurred in connection with registrations, filings or
qualifications pursuant to Section 20 for Holder, including
(without limitation) all registration, filing and qualification
fees, printers’ and accounting fees, fees and disbursements
of counsel for the Company shall be borne by the
Company.






 



[Remainder of Page Intentionally Left Blank]


 


 


 


 




 

8








 






IN
WITNESS WHEREOF, the Company has caused this Warrant to be duly
executed and delivered by its authorized officer as of the date
first above written.

 


ROOT9B
HOLDINGS, INC. , a Delaware corporation

 


Signed:                                                          




By:                 


Title:


 


 


Company
Address:           
root9B Holdings, Inc.


102 N.
Cascade Avenue, Suite 220


Colorado Springs,
CO 80919


Attn:
Chief Financial Officer


 


 


 


 




 








 







EXHIBIT A

 



PURCHASE/EXERCISE FORM


 


	

To:
ROOT9B HOLDINGS, INC.

	
 

	

Dated:_________________






 


The
undersigned holder, pursuant to the provisions set forth in the
attached Warrant No. ___, hereby exercises the right to purchase
_________________ shares of Common Stock covered by such Warrant.
Capitalized terms used herein and not otherwise defined shall have
the respective meanings set forth in the Warrant.

 


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

 



____________ 

a
“Cash
Exercise” with respect to _________________ shares of
Warrant Stock; and





 


2.           Payment
of Exercise Price. The Registered Holder shall pay the
aggregate Exercise Price in the sum of $___________________ to the
Company in accordance with the terms of the Warrant.

 


The
undersigned acknowledges that it has reviewed the representations
and warranties contained in Section 13 of the Warrant and by its
signature below hereby makes such representations and warranties to
the Company.

 



Signature:                                                                    





 



Name
(print):                                                              





 



Title (if
applic.)                                                
          






 



Company (if
applic.): ________________________






 


 




 








 










 



EXHIBIT B

 



ASSIGNMENT FORM

 


FOR
VALUE RECEIVED, _________________________________________ hereby
sells, assigns and transfers all of the rights of the undersigned
under the attached Warrant No. ___ with respect to the number of
shares of Common Stock covered thereby set forth below,
to:

 


	


Name of Assignee




	


Address/Fax Number




	


No. of Shares





	
 

	
 

	
 


	
 

	
 

	
 


	
 

	
 

	
 


	
 

	
 

	
 


	
 

	
 

	
 


	
 

	
 

	
 


	
 

	
 

	
 







 


 


	

Dated:

	

Signature:                                                       


	
 

	
 


	
 

	

Witness:
_______________________