Exhibit 10.4


 


THIS WARRANT
AND THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”),
AND MAY NOT BE SOLD, TRANSFERRED, ASSIGNED OR HYPOTHECATED UNLESS THERE IS AN EFFECTIVE REGISTRATION STATEMENT UNDER THE ACT COVERING
SUCH SECURITIES, THE SALE IS MADE IN ACCORDANCE WITH RULE 144 UNDER THE ACT, OR THE COMPANY RECEIVES AN OPINION OF COUNSEL
FOR THE HOLDER OF THESE SECURITIES REASONABLY SATISFACTORY TO THE COMPANY STATING THAT SUCH SALE, TRANSFER, ASSIGNMENT OR HYPOTHECATION
IS EXEMPT FROM THE REGISTRATION AND PROSPECTUS DELIVERY REQUIREMENTS OF SUCH ACT. THIS WARRANT AND THE SECURITIES ISSUABLE
UPON EXERCISE OF THIS WARRANT MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT OR OTHER LOAN SECURED BY SUCH SECURITIES.


 


Warrant No. WC-35


 


AUDIOEYE, INC.


COMMON STOCK WARRANT


 


This Common Stock Warrant
(this “Warrant”) is issued as of August 14, 2019 (the “Original Issue Date”),
by AudioEye, Inc., a Delaware corporation (the “Company”), to Sero Capital LLC, a Delaware limited liability
company (the “Holder”), in connection with that certain Loan Agreement, dated as of August 14, 2019,
by and between the Company and the Holder (as the same may from time to time be amended, modified, extended, renewed or restated,
the “Loan Agreement” and, together with this Warrant, the “Transaction Agreements”).


 


1.       Number
of Warrant Shares; Exercise Price. Subject to the terms and conditions set forth herein, the Holder is entitled, upon surrender
of this Warrant at the principal office of the Company, to purchase from the Company 146,667 shares of common stock, $0.00001 par
value per share (the “Common Stock”), of the Company (as adjusted from time to time, “Warrant
Shares”) at a price of $6.00 per Warrant Share (as adjusted pursuant to Section 9, the “Exercise
Price”).


 


2.       Exercise
Period. This Warrant is exercisable as to the Warrant Shares covered hereby during the period commencing on the Original Issue
Date and continuing until 5:00 p.m. Arizona Time on August 14, 2020 (the “Expiration Date”); provided
that, if the Fair Market Value (as defined in Section 4 below) on the Expiration Date exceeds the Exercise Price on the
Expiration Date, then this Warrant shall be deemed to have been exercised in full (to the extent not previously exercised) on a
“cashless exercise” basis at 5:00 p.m. Arizona Time on the Expiration Date.


 


3.       Method
of Exercise. Subject to Sections 1 and 2 above, the Holder may exercise, in whole or in part, the purchase rights
evidenced by this Warrant. Such exercise shall be effected by: (a) the surrender of this Warrant, together with a duly executed
copy of the form of exercise notice attached hereto as Annex I (the “Exercise Notice”), to the
secretary of the Company at its principal office, accompanied by (b) either (x) the payment to the Company by cash, check
or wire transfer of an amount equal to the product of (i) the Exercise Price multiplied by (ii) the number of Warrant Shares being
purchased (such product, the “Purchase Price”) or (y) the payment of the Purchase Price through a “cashless
exercise” in accordance with Section 4. The date on which the Exercise Notice is delivered to the secretary of the
Company is an “Exercise Date.”


 




     

     


    

  


4.       Cashless
Exercise. In the event the Holder elects to satisfy its obligation to pay the Purchase Price through a “cashless”
exercise, the Company shall issue to the Holder the number of Warrant Shares determined as follows:


 


X = Y [(A-B)/A]


 


where:


 


“X” equals the number of Warrant
Shares to be issued to the Holder;


 


“Y” equals the total number
of Warrant Shares with respect to which this Warrant is being exercised;


 


“A” equals the arithmetic average
of the Closing Sale Price of the shares of Common Stock (as reported by Bloomberg Financial Markets) for the five (5) consecutive
Trading Days ending on the date immediately preceding the Exercise Date (the “Fair Market Value”); and


 


“B” equals the Exercise Price
then in effect for the applicable Warrant Shares at the time of such exercise.


 


For purposes of this Warrant, “Closing
Sale Price” means, for any security as of any date, the last trade price for such security on the Principal Trading
Market for such security, as reported by Bloomberg Financial Markets, or, if such Principal Trading Market begins to operate on
an extended hours basis and does not designate the last trade price, then the last trade price of such security prior to 4:00 P.M.,
New York City time, as reported by Bloomberg Financial Markets, or if the foregoing do not apply, the last trade price of such
security in the over-the-counter market on the electronic bulletin board for such security as reported by Bloomberg Financial Markets,
or, if no last trade price is reported for such security by Bloomberg Financial Markets, the average of the bid prices, or the
ask prices, respectively, of any market makers for such security as reported in the “pink sheets” by OTC Markets. “Trading
Day” means a day on which exchanges in the United States are open for the buying and selling of securities. “Principal
Trading Market” means the OTC Bulletin Board, the OTC Markets, NASDAQ or a national securities exchange. If the Closing
Sale Price cannot be calculated for a security on a particular date on any of the foregoing bases, the Closing Sale Price of such
security on such date shall be the fair market value as determined in good faith by the Board of Directors of the Company. The
Board of Directors’ determination shall be binding upon all parties absent demonstrable error. All such determinations shall
be appropriately adjusted for any stock dividend, stock split, stock combination or other similar transaction during the applicable
calculation period.


 


5.       Rule
144. For purposes of Rule 144 promulgated under the Securities Act of 1933, as amended (the “Act”),
it is intended, understood and acknowledged that the Warrant Shares issued in a “cashless exercise” transaction shall
be deemed to have been acquired by the Holder, and the holding period for the Warrant Shares shall be deemed to have commenced,
on the Original Issue Date of this Warrant (provided that the Securities and Exchange Commission continues to take the position
that such treatment is proper at the time of such exercise).


 






    	 	-2-	 



     


    




 


6.       Certificates
for Warrant Shares. If the shares of the Company are certificated, upon the exercise of the purchase rights evidenced by this
Warrant, one or more certificates for the number of Warrant Shares so purchased shall be issued and delivered to the Holder as
soon as practicable thereafter, with a legend substantially similar to the legend set forth below (in addition to any legend required
under applicable state securities laws):











 


“THE
SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER UNITED STATES FEDERAL OR STATE SECURITIES LAWS AND MAY
NOT BE OFFERED FOR SALE, SOLD, OR OTHERWISE TRANSFERRED OR ASSIGNED FOR VALUE, DIRECTLY OR INDIRECTLY, NOR MAY THE SECURITIES BE
TRANSFERRED ON THE BOOKS OF THE COMPANY, WITHOUT REGISTRATION OF SUCH SECURITIES UNDER ALL APPLICABLE UNITED STATES FEDERAL OR
STATE SECURITIES LAWS OR COMPLIANCE WITH AN APPLICABLE EXEMPTION THEREFROM, SUCH COMPLIANCE, AT THE OPTION OF THE COMPANY, TO BE
EVIDENCED BY AN OPINION OF THE HOLDER’S COUNSEL, IN A FORM ACCEPTABLE TO THE COMPANY, THAT NO VIOLATION OF SUCH REGISTRATION
PROVISIONS WOULD RESULT FROM ANY PROPOSED TRANSFER OR ASSIGNMENT.”


 


Upon any partial exercise
of this Warrant, the Company shall forthwith issue and deliver to the Holder a new warrant or warrants of like tenor as this Warrant
for the remaining portion of the Warrant Shares for which this Warrant may still be exercised.


 


The legend set forth
in this Section 6 shall be removed and the Company shall issue a certificate (or issue in an uncertificated form) without
such legend or any other legend to the Holder if (a) such Warrants or Warrant Shares are sold pursuant to an effective registration
statement under the Act (provided that the Holder agrees to only sell such Warrant or Warrant Shares during such time that the
registration statement is effective and not withdrawn or suspended, and only as permitted by the registration statement), (b) such
Warrants or Warrant Shares are sold or transferred pursuant to, and in accordance with all requirements of, Rule 144 (including,
if applicable, the volume, manner-of-sale and notice filing provisions of Rule 144), or (c) such Warrants or Warrant Shares are
eligible for sale under Rule 144, without the requirement for the Company to be in compliance with the current public information
required under Rule 144 as to such securities and without volume or manner-of-sale restrictions. The Company shall bear all costs
incurred by it or a Holder relating to the removal of the legend in accordance with this Section 6, provided that the Company
shall not be liable for any transfer taxes relating to the issuance of a new certificate or statement in the name of any person
other than the relevant Holder and its affiliates.


 


7.       Issuance
of Warrant Shares. The Company covenants that the Warrant Shares, when issued pursuant to the exercise of this Warrant, will
be duly and validly issued, fully-paid and non-assessable and free from all taxes, liens, and charges with respect to the issuance
thereof (except for any applicable transfer taxes, which shall be paid by the Holder).


 


8.       Reservation
of Warrant Shares. From the date hereof until the Expiration Date, the Company shall at all times reserve and keep available
out of its authorized but unissued Common Stock of the Company or other securities constituting Warrant Shares, solely for the
purpose of issuance upon the exercise of this Warrant, the maximum number of Warrant Shares issuable upon the exercise of this
Warrant, and the par value per Warrant Share shall at all times be less than or equal to the applicable Exercise Price. The Company
shall not increase the par value of any Warrant Shares receivable upon the exercise of this Warrant above the Exercise Price then
in effect, and shall take all such actions as may be necessary or appropriate in order that the Company may validly and legally
issue fully paid and nonassessable shares of Common Stock of the Company upon the exercise of this Warrant.


 




    	 	-3-	 



     


    

 


9.       Adjustment
of Exercise Price and Number of Warrant Shares. The number of and kind of Warrant Shares purchasable upon exercise of this
Warrant and the Exercise Price shall be subject to adjustment from time to time as follows:


 


(a)       Subdivisions,
Combinations and Other Issuances. If the Company shall at any time or from time to time prior to the Expiration Date subdivide
the Warrant Shares, by forward stock split or otherwise, or combine such shares, or issue additional shares as a dividend with
respect to any such shares, the number of Warrant Shares issuable on the exercise of this Warrant shall forthwith be proportionately
increased in the case of a subdivision or stock dividend, or proportionately decreased in the case of a combination. Appropriate
adjustments shall also be made to the Exercise Price payable per Warrant Share, but the Purchase Price payable for the total number
of Warrant Shares purchasable under this Warrant (as adjusted) shall remain the same. The aggregate Exercise Price shall
be reduced by the aggregate amount of cash dividends paid to holders of equity securities in the Company prior to the date of the
Holder’s exercise of the Warrant. Any adjustment under this Section 9(a) shall
become effective as of the record date of such subdivision, combination, dividend, or other distribution, or in the event that
no record date is fixed, upon the making of such subdivision, combination or dividend.


 


(b)       Merger,
Consolidation, Reclassification, Reorganization, Etc. In case of any change in the Warrant Shares prior to the Expiration Date
(other than as a result of a subdivision, combination, or stock dividend provided for in Section 9(a) above), whether through
merger, consolidation, reclassification, reorganization, partial or complete liquidation, purchase of substantially all the assets
of the Company, or other change in the capital structure of the Company (any of the foregoing a “Sale Event”),
then, as a condition of such Sale Event, lawful and adequate provision will be made so that the Holder will have the right thereafter
to receive upon the exercise of the Warrant the kind and amount of shares of stock or other securities or property to which it
would have been entitled if, immediately prior to such Sale Event, the Holder had held the number of Warrant Shares obtainable
upon the exercise of the Warrant. In any such case, appropriate adjustment will be made in the application of the provisions set
forth herein with respect to the rights and interest thereafter of the Holder, to the end that the provisions set forth herein
will thereafter be applicable, as nearly as reasonably may be, in relation to any shares of stock or other property thereafter
deliverable upon the exercise of the Warrant. If the Company, at any time while this Warrant is outstanding, distributes to holders
of the Common Stock (i) evidences of its indebtedness, (ii) any security (other than a distribution of the Common Stock covered
by Section 9(a)), (iii) rights or warrants to subscribe for or purchase any security, or (iv) any other asset (in each case,
“Distributed Property”), then in each such case the Holder shall be entitled upon exercise of this Warrant
for the purchase of any or all of the Warrant Shares, to receive the amount of Distributed Property which would have been payable
to the Holder had such Holder been the holder of such Warrant Shares on the record date for the determination of stockholders entitled
to such Distributed Property.  The Company will at all times set aside in escrow and keep available for distribution to the
Holder upon exercise of this Warrant a portion of the Distributed Property to satisfy the distribution to which the Holder is entitled
pursuant to the preceding sentence.  The Company will not permit any change in its capital structure to occur unless the issuer
of the shares of stock or other securities to be received by the Holder, if not the Company, agrees to be bound by and comply with
the provisions of this Warrant.


 


(c)       Black
Scholes Value. Notwithstanding the foregoing and the provisions of Section 9(b) above, in the event of a Sale Event,
if the Holder has not exercised this Warrant in full prior to the consummation of such Sale Event, at the request of the Holder
delivered before the ninetieth (90th) day after the consummation of such Sale Event, the Company (or the successor entity
(as the case may be)) shall purchase this Warrant from the Holder on the date of such request by paying to the Holder cash in an
amount equal to the Black Scholes Value of the unexercised portion of this Warrant that remained on the date of the consummation
of such Sale Event. For purposes of this Warrant, the term “Black Scholes Value” means the value of this
Warrant based on the Black Scholes Option Pricing Model obtained from the “OV” function on Bloomberg determined as
of the day of consummation of the applicable Sale Event for pricing purposes and reflecting (i) a risk-free interest rate corresponding
to the U.S. Treasury rate for a period equal to the remaining term of this Warrant as of the date of the Holder’s request
pursuant to Section 9(c), (ii) an expected volatility equal to the 100 day volatility obtained from the HVT function on
Bloomberg as of the Trading Day immediately following the public announcement of the applicable Sale Event (using 360 as the input
for the annualization factor and the Rogers-Satchell volatility estimator model), which volatility shall in no event be more than
150% or less than 80%, and, if applicable, (iii) the underlying price per share used in such calculation shall be the sum of the
price per share being offered in cash, if any, plus the value of any non-cash consideration, if any, being offered in the applicable
Sale Event.


 




    	 	-4-	 



     


    

  


(d)       Notice
of Adjustment. When any adjustment is required to be made in the number or kind of shares purchasable upon exercise of the
Warrant, or in the Exercise Price, the Company shall promptly notify the Holder of such event, the amount of the adjustment,
the method by which such adjustment was calculated, and the number of Warrant Shares or other
securities or property thereafter purchasable and/or the Exercise Price after giving effect to such adjustment upon
exercise of this Warrant.


 


(e)       Notice
of Sale Event or Distributed Property. The Company shall promptly notify the Holder (i) of any Sale Event and the kind and
amount of shares of stock or other securities or property to which the Holder will be entitled in accordance with Section 9(b),
and (ii) in the event there is any distribution of Distributed Property, the portion of the Distributed Property to which the Holder
is entitled in accordance with Section 9(b).


 


10.       Further
Limitations on Disposition. The Holder agrees not to dispose of all or any portion of the Warrant Shares or the Warrant (a)
unless and until there is then in effect a registration statement under the Act covering such proposed disposition and such disposition
is made in accordance with such registration statement, or (b) the proposed disposition is pursuant to a transaction exempt from
the registration requirements of the Act; provided, however, that the Holder may dispose or otherwise transfer the Warrant (or
the Warrant Shares) to an affiliate of the Holder, to a family member of the Holder, or to any trust, partnership, limited liability
company or custodianship established for estate-planning purposes for the primary benefit of the Holder or his or her family members,
in each case without the requirements set forth in this Section 10.


 


11.       No
Fractional Warrant Shares. Notwithstanding any provisions to the contrary in this Warrant, the Company shall not be required
to issue any Warrant Shares representing fractional Warrant Shares, but may instead make a payment in cash based on the Exercise
Price.


 


12.       No
Rights as Stockholders. Prior to the exercise of this Warrant, the Holder shall not be entitled to any rights of a stockholder
of the Company, including, without limitation, the right to vote, to receive dividends or other distributions or to exercise any
pre-emptive rights, and the Holder shall not be entitled to receive any notice of any proceedings of the Company, in each case,
except as provided herein or as otherwise agreed. Upon exercise of this Warrant in accordance with Section 3 hereof, the
Holder shall immediately become the owner of the Warrant Shares so exercised and shall have all rights as a stockholder (including
voting rights) in respect of such Warrant Shares.


 


13.       Loss,
Etc. of Warrant. Upon receipt of evidence satisfactory to the Company of the loss, theft, destruction or mutilation of this
Warrant, and of indemnity reasonably satisfactory to the Company if lost, stolen or destroyed, and upon surrender and cancellation
of this Warrant if mutilated, and upon reimbursement of the Company’s reasonable incidental expenses, the Company shall execute
and deliver to the Holder a new Warrant of like date, tenor and denomination.


 




    	 	-5-	 



     


    

 





14.       Miscellaneous.


 


(a)       Further
Acts. Each of the parties hereto agrees to perform any further acts and execute and deliver any documents that may be reasonably
necessary to carry out the provisions of this Warrant.


 


(b)       Notices.
Unless otherwise provided, all notices and other communications required or permitted under this Warrant shall be in writing and
shall be mailed by United States first-class mail, postage prepaid, sent by facsimile or delivered personally by hand or by a nationally
recognized courier addressed to the party to be notified at the address or facsimile number indicated for such person in the Loan
Agreement, or at such other address or facsimile number as such party may designate by ten (10) days’ advance written notice
to the other parties hereto. All such notices and other written communications shall be effective on the date of mailing, confirmed
facsimile transfer or delivery.


 


(c)       Amendment
and Modification; Waiver. Except as otherwise provided herein, this Warrant may only be amended, modified or supplemented by
an agreement in writing signed by the Company and the Holder and their successors and assigns. No waiver by the Company or the
Holder shall be effective unless explicitly set forth in writing and signed by such parties so waiving. No waiver by any party
shall operate or be construed as a waiver in respect of any failure, breach or default not expressly identified by such written
waiver, whether of a similar or different character, and whether occurring before or after that waiver. No failure to exercise,
or delay in exercising, any rights, remedy, power or privilege arising from this Warrant shall operate or be construed as a waiver
thereof; nor shall any single or partial exercise of any right, remedy, power or privilege hereunder preclude any other or further
exercise thereof or the exercise of any other right, remedy, power or privilege.


 


(d)       Headings;
References. The headings of sections contained in this Warrant are included herein for reference purposes only, solely for
the convenience of the parties hereto, and shall not in any way be deemed to effect the meaning, interpretation or applicability
of this Warrant or any term, condition or provision hereof.


 


(e)       Successors
and Assigns. All of the covenants, stipulations, promises, and agreements in this Warrant shall bind and inure to the benefit
of the parties’ respective successors and assigns, whether so expressed or not.


 


(f)       Governing
Law. This Warrant any controversy arising out of or relating to this Agreement shall be governed by and construed in accordance
with the internal laws of the State of Delaware, without reference to the conflicts of law provisions.


 


(g)       Entire
Agreement. The terms and provisions of the Transaction Agreements supersede all written and oral agreements and representations
made by or on behalf of the Company. The Transaction Agreements contain the entire agreement of the parties.


 


(h)       Severability.
If one or more provisions of this Warrant are held to be unenforceable under applicable law, such provision shall be excluded from
this Warrant and the balance of the Warrant shall be interpreted as if such provision were so excluded and shall be enforceable
in accordance with its terms.


 




    	 	-6-	 



     


    

 





(i)       Execution
and Counterparts. This Warrant may be executed in counterparts, each of which when so executed and delivered shall be deemed
an original, and such counterparts together shall constitute only one instrument. Any one of such counterparts shall be sufficient
for the purpose of proving the existence and terms of this Warrant and no party shall be required to produce an original or all
of such counterparts in making such proof.


 


(j)       Jurisdiction.
EACH OF THE PARTIES AGREE THAT NEITHER IT NOR ANY ASSIGNEE OR SUCCESSOR SHALL (A) SEEK A JURY TRIAL IN ANY LAWSUIT, PROCEEDING,
COUNTERCLAIM OR ANY OTHER ACTION BASED UPON, OR ARISING OUT OF, THIS WARRANT OR (B) SEEK TO CONSOLIDATE ANY SUCH ACTION WITH ANY
OTHER ACTION IN WHICH A JURY TRIAL CANNOT BE OR HAS NOT BEEN WAIVED. THE PROVISIONS OF THIS PARAGRAPH HAVE BEEN FULLY DISCUSSED
BY THE PARTIES HERETO, AND THESE PROVISIONS SHALL BE SUBJECT TO NO EXCEPTIONS. NONE OF THE PARTIES HERETO HAS AGREED WITH OR REPRESENTED
TO ANY OTHER THAT THE PROVISIONS OF THIS PARAGRAPH WILL NOT BE FULLY ENFORCED IN ALL INSTANCES. EACH OF THE PARTIES HEREBY SUBMITS
TO THE JURISDICTION OF THE COURTS OF THE STATE OF DELAWARE AND THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF DELAWARE, AS
WELL AS TO THE JURISDICTION OF ALL COURTS FROM WHICH AN APPEAL MAY BE TAKEN OR OTHER REVIEW SOUGHT FROM THE AFORESAID COURTS, FOR
THE PURPOSE OF ANY SUIT, ACTION OR OTHER PROCEEDING ARISING OUT OF OR WITH RESPECT TO THIS WARRANT OR ANY OF THE TRANSACTIONS CONTEMPLATED
HEREBY, AND EXPRESSLY WAIVES ANY AND ALL OBJECTIONS IT MAY HAVE AS TO VENUE IN ANY OF SUCH COURTS.


 


(k)       Information
Rights. While  any  securities of the Company remain outstanding and  are “restricted securities”
within the meaning of Rule 144(a)(3) under the Act, the Company will, during any period in which the Company is not subject to
and in compliance with Section 13 or 15(d) of the of the Securities and Exchange Act of 1934, as amended (the “Exchange
Act”) and are not exempt from reporting under Rule 12g3-2(b) under the Exchange Act, furnish to the Holder, upon
request and at the Company’s expense, the information required to be delivered pursuant to Rule 144A(d)(4) under the Act.


 


(l)       No
Impairment. The Company shall not, by amendment of its Certificate of Incorporation or through a reorganization, transfer of
assets, consolidation, merger, dissolution, issue, or sale of securities or any other voluntary action, avoid or seek to avoid
the observance or performance of any of the terms to be observed or performed under this Warrant by the Company, but shall at all
times in good faith assist in carrying out of all the provisions of this Warrant and in taking all such action as may be necessary
or appropriate to protect the Holder’s rights under this Warrant against impairment.


 


(m)       Maximum
Issuance. Notwithstanding the foregoing, without the prior approval of the Company’s stockholders as required pursuant
to the rules and regulations of the The Nasdaq Capital Market, the aggregate number of shares of Common Stock actually issued by
the Company under the Transaction Agreements shall not exceed 19.99% of the Common Stock outstanding as of the Original Issue Date,
for purposes of NASDAQ Listing Rule 5635(d), at a price, determined in accordance with the rules and regulations of The Nasdaq
Capital Market, that is less than the Minimum Price (as defined below).  The term “Minimum Price”
means a price that is the lower of (i) the Closing Sale Price of the Common Stock immediately preceding the signing of the Loan
Agreement; or (ii) the average Closing Sale Price of the Common Stock for the five (5) Trading Days immediately preceding the signing
of the Loan Agreement. 


 


[Remainder of page
intentionally left blank]


 




    	 	-7-	 



     


    

  


IN WITNESS WHEREOF,
this Warrant is executed as of the date first written above.


 





	 	COMPANY:
	 	 	 
	 	AUDIOEYE, INC.
	 	 	 
	 	By:	/s/ Carr
    Bettis
	 		Name: Carr Bettis
	 		Title:   Executive Chair







 


Signature page to


AudioEye, Inc.

Common Stock Warrant


 




     

     


    

 


IN WITNESS WHEREOF,
this Warrant is executed as of the date first written above.


 





	 	HOLDER:
	 	 
	 	SERO CAPITAL LLC
	 	 	 
	 	By:	/s/ David Moradi
	 	 	 
	 	Name: 	David Moradi
	 	 	 
	 	Title:	Owner







 





Signature page to


AudioEye, Inc.

Common Warrant


 




     

     


    

 


ANNEX I


 


NOTICE OF EXERCISE


 


	TO:	 	 
	 	 	 
	 	 	 


 


1.           The
undersigned Warrantholder (“Holder”) elects to acquire the Warrant Shares of AudioEye, Inc. (the “Company”),
pursuant to the terms of the Warrant dated August 14, 2019 (the “Warrant”). Capitalized terms used herein
and not otherwise defined herein have the respective meanings set forth in the Warrant.


 


2.           The
Holder elects to purchase _________ Warrant Shares as provided in Section 3 and (check one):


 


☐  tenders herewith a check in the amount of $_______ as payment of the Purchase Price


 


		☐	  intends that payment of the Purchase Price shall be made as a “cashless exercise’ under
Section 4 of the Warrant



 


3.           The
Holder surrenders the Warrant with this Notice of Exercise.


 


4.           The
Holder represents that it is acquiring the aforesaid Warrant Shares for investment and not with a view to, or for resale in connection
with, distribution and that the Holder has no present intention of distributing or reselling the Warrant Shares unless in compliance
with all applicable federal and state securities laws.


 


5.           Pursuant
to this Notice of Exercise, the Company shall deliver to the Holder Warrant Shares determined in accordance with the terms of the
Warrant.


  


	By:	 	 
	 	 	 
	Name:	 	 
	 	 	 
	Title:	 	 
	 	 	 
	Date: