Document:

Exhibit

EXHIBIT 10.18
TD AMERITRADE HOLDING CORPORATION
RESTRICTED STOCK UNIT AGREEMENT
TD Ameritrade Holding Corporation (the “Company”) hereby grants you, [______________] (the “Grantee”), the number of Restricted Stock Units indicated below under the Company’s 1996 Long-Term Incentive Plan (the “Plan”).  Unless otherwise defined herein, the terms defined in the Plan shall have the same defined meanings in this Restricted Stock Unit Agreement (the “Agreement”) and each Appendix.  Subject to the provisions of Appendix A and B (attached) and of the Plan, the principal terms of this grant are as follows:
	
			
	Grant Date:
	 
	[Date]

	 
	 
	 

	Total Number of
	 
	 

	Restricted Stock Units:
	 
	[Number]

	 
	 
	This reflects the total number of Restricted Stock Units granted to you on the Grant Date, and shall be increased as of any date by the cumulative number of additional Restricted Stock Units, if any, credited by this Agreement through such date in payment of Dividend Equivalent Rights as described in paragraph 30 of Appendix A (attached) to this Agreement.*

	 
	 
	 

	Scheduled Vesting:
	 
	The Restricted Stock Units will vest in accordance with the schedule set forth in Appendix A and B (attached) and subject to all of the terms and provisions of the Plan and this Agreement.

	 
	 
	 

	Settlement Date:
	 
	One Share will be issued for each Restricted Stock Unit that has vested on the applicable Vesting Date specified in Appendix A and B (or on a date as soon as practicable, and no more than thirty (30) days, thereafter)

	 
	 
	 

	Acceptance:
	 
	You must accept this grant of Restricted Stock Units prior to the Acceptance Deadline, which is sixty (60) days from the Grant Date.

*Except as otherwise specifically provided in this Agreement, or by the terms of the Plan, you will not vest in any Restricted Stock Units unless you remain employed by the Company or one of its Related Entities through the applicable Vesting Date.

Your signature below indicates your agreement and understanding that this grant is subject to all of the terms and conditions contained in the Plan and this Agreement, including Appendix A and Appendix B.  Important additional information on vesting, forfeiture and the actual issuance of the Shares in settlement of the Restricted Stock Units covered by this grant are contained in paragraphs 4 through 15 of Appendix A.  PLEASE BE SURE TO READ ALL OF APPENDIX A AND APPENDIX B, WHICH CONTAIN THE SPECIFIC TERMS AND CONDITIONS OF THIS AGREEMENT.  
THIS AGREEMENT MUST BE ACCEPTED BY YOU BY THE ACCEPTANCE DEADLINE, OR THIS GRANT OF RESTRICTED STOCK UNITS WILL AUTOMATICALLY BE CANCELED.  
TD AMERITRADE HOLDING CORPORATION    
By:    
Title: EVP, Chief Human Resources Officer        

ACCEPTED BY THE GRANTEE
___________________________________
Print Name
___________________________________
Signature
___________________________________
Acceptance Date (must be within sixty (60) days of the Grant Date)

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APPENDIX A
TERMS AND CONDITIONS OF RESTRICTED STOCK UNITS
1.Grant.  The Company hereby grants to the Grantee under the Plan at the per share                                  price of $.01, equal to the par value of a Share, the number of Restricted Stock Units indicated in the Notice of Grant, subject to all of the terms and conditions in the Agreement, Appendix A and B and the Plan.  
2.No Payment of Purchase Price Necessary.  When the Restricted Stock Units are settled through the issuance of Shares to the Grantee, the par value of the underlying Company Stock will be deemed paid by the Grantee for each Restricted Stock Unit through the past services rendered by the Grantee, and such deemed payment will be subject to the appropriate tax withholdings.
3.Company’s Obligation to Pay.  Each Restricted Stock Unit represents a right to receive, on the Vesting Date, one Share for each vested Restricted Stock Unit.   Unless and until the Restricted Stock Units have vested in the manner set forth in this Agreement and Appendix A and B, the Grantee will have no right to receive settlement of Shares underlying such Restricted Stock Units.  Prior to the settlement of any vested Restricted Stock Units, such Restricted Stock Units will represent an unsecured obligation.  Payment of any vested Restricted Stock Units will be made in Shares.
4.Vesting Schedule.  Except as otherwise provided in paragraph 5 of this Appendix A, the Restricted Stock Units awarded by this Agreement are scheduled to vest in accordance with the vesting schedule set forth in Appendix B.  Notwithstanding any contrary provision of this Agreement, Restricted Stock Units scheduled to vest on any applicable date actually will vest only if the Grantee continues to be an Employee through such date, except to the limited extent specifically provided in the Plan or this Agreement.  
5.Committee Discretion.  The Committee, in its discretion, may accelerate the vesting of the balance, or some lesser portion of the balance, of the Restricted Stock Units at any time, subject to the terms of the Plan.  If so accelerated, such Restricted Stock Units will be considered as having vested as of the date specified by the Committee.  
6.Issuance of Shares after Vesting.  Each Restricted Stock Unit that becomes vested under this Agreement will be settled by the Company through the issuance of Shares to the Grantee (or in the event of the Grantee’s death, to his or her estate) as soon as administratively practicable following the Vesting Date, subject to paragraph 15, and in no event later than the thirtieth (30th) day following the Vesting Date.
7.Forfeiture Upon Ceasing to be an Employee.  Other than as provided in paragraphs 9 through 14, and notwithstanding any contrary provision of this Agreement, Appendix A and Appendix B, the balance of the Restricted Stock Units that have not vested pursuant to paragraphs 4 or 5 at the time the Grantee ceases to be an Employee will be forfeited and automatically transferred to and reacquired by the Company at no cost to the Company.  The Grantee shall not be entitled to a

refund of any price paid for the Restricted Stock Units forfeited to the Company pursuant to this paragraph 7.  
8.Forfeiture or Repayment in Connection with Certain Events.  
(a)    Forfeiture or Repayment.  Notwithstanding any contrary provision of this Agreement, Appendix A, Appendix B or the terms of any written agreement between the Company and the Grantee (including specifically any written employment, severance or change in control agreement) if the Committee determines (in its sole discretion, but acting in good faith) that a Clawback Event has occurred at any time while the Grantee is an Employee and such determination is made no later than three (3) years following the Grant Date, then: (i) the balance of the Restricted Stock Units that have not vested as of the date of such event may, in the sole discretion of the Committee, be forfeited and automatically transferred to and reacquired by the Company at no cost to the Company; (ii) any Shares previously issued under this Agreement to the Grantee for vested Restricted Stock Units that have not been sold, transferred or otherwise disposed of by the Grantee may, in the sole discretion of the Committee, be forfeited and automatically transferred to and reacquired by the Company at no cost to the Company; and (iii) if the Shares previously issued under this Agreement to the Grantee for vested Restricted Stock Units have been sold, transferred or otherwise disposed of by the Grantee, the Gain realized by the Grantee (or that would have been realized had the Grantee sold the Shares in an arms-length transaction) will be paid by the Grantee to the Company, if the Committee, in its sole discretion, requires such payment.  If, with respect to subsections (ii) and/or (iii) in the preceding sentence, the Grantee refuses to transfer the Shares to the Company and/or make a payment to the Company equal to the Gain, the Company will, if directed by the Committee, in its sole discretion, and subject to applicable law (including any Code Section 409A considerations), recover the value of such Shares and/or Gain and, if applicable, the amount of its court costs, attorneys’ fees and other costs and expenses incurred in connection with enforcing this paragraph 8 by (w) reducing the amount that would otherwise be payable to the Grantee under any compensatory plan, program or arrangement maintained by the Company or any Subsidiary, (x) withholding payment of future increases in compensation (including the payment of any discretionary bonus amount) or grants of compensatory awards that would otherwise have been made in accordance with the Company’s (or a Subsidiary’s) otherwise applicable compensation practices, (y) reducing any severance benefits that would otherwise be payable or provided to the Grantee under any plan, program or arrangement maintained or entered into by the Company or any Subsidiary (including specifically under any employment or severance agreement) or (z) by any combination of the foregoing.
(b)    Discretion to Reduce Amount Subject to Forfeiture or Repayment.  In the event of a Clawback Event described in paragraph 8(c)(i)(A) below and the Restricted Stock Units were issued to the Grantee as payment (in whole or part) for an award earned under the Company’s Management Incentive Plan (or any other bonus plan of the Company), the Committee may, in its sole discretion, limit the amount to be forfeited by the Grantee and/or recovered from the Grantee to the amount by which the award earned under the applicable bonus plan exceeded the amount that would have been earned had the financial statements been initially filed as restated, as determined by the Committee in accordance with the terms and conditions of the applicable bonus plan.  In the event the Committee exercises such discretion, if the award earned under the applicable bonus plan was paid in cash and the Restricted Stock Units, the Committee will have discretion to determine

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 how the amount to be recovered will be allocated among the portion paid in cash and the portion paid in Restricted Stock Units.  The amount of Restricted Stock Units, if any, subject to forfeiture or repayment will be covered in the following order: first, unvested Restricted Stock Units that remain outstanding; then, Shares previously issued under this Agreement to the Grantee for vested Restricted Stock Units that have not been sold, transferred or otherwise disposed of by the Grantee; and finally, Gain realized (or that would have been realized in an arms-length transaction) by the Grantee from the sale, transfer or disposition of Shares previously issued under this Agreement to the Grantee for vested Restricted Stock Units.
(c)    Definitions.  
(i)    For purposes of this Agreement, Appendix A and Appendix B, a “Clawback Event” shall mean one or more of the following: (A) any of the Company’s financial statements are required to be restated resulting from fraud or willful misconduct by the Grantee or any other person, provided that the Grantee knew or should have known of such fraud or willful misconduct; or (B) any act of fraud, negligence or breach of fiduciary duty by the Grantee or any other person, provided that the Grantee knew or should have known of such fraud, negligence or breach of fiduciary duty, resulting in material loss, damage or injury to the Company.  
(ii)    For purposes of this Agreement, Appendix A and Appendix B, “Gain” shall mean the Fair Market Value of a Share on the date of sale, transfer or other disposition, multiplied by the number of Shares sold, transferred or otherwise disposed of.  
(d)    Restrictions on Sale of Stock Pending Determination of Clawback Event.  If the Company reasonably believes that a Clawback Event has occurred, the Grantee understands and agrees that the Company may, in its sole discretion, restrict the Grantee’s ability to directly or indirectly sell, offer, contract or grant any option to sell (including without limitation any short sale), pledge, swap, hedge, transfer, or otherwise dispose of any shares of Company common stock held by the Grantee in his or her Company brokerage account (whether issued in connection with this Agreement or otherwise) pending a final determination by the Committee that a Clawback Event has or has not occurred.  Such determination shall be made as soon as administratively practicable but in no event will the Grantee be restricted in accordance with the preceding sentence for more than that period of time reasonably necessary for the Committee to determine the existence of a Clawback Event.  The Grantee further understands and agrees that that the Company shall have no responsibility or liability for any fluctuations that occur in the price of the Company’s common stock or for any potential loss or gain the Grantee could have realized from the sale of his or her shares of Company common stock during the period of time in which the Grantee is restricted in accordance with this paragraph 8(d). 
(e)    Change of Control.  Notwithstanding any contrary provision of this Agreement, Appendix A or Appendix B, this paragraph 8 will expire and have no further force or effect upon a Change of Control.  Solely with respect to this paragraph 8, a “Change of Control” shall not be deemed to have occurred if the Company’s outstanding Shares or substantially all of the Company’s assets are purchased by TD Bank Financial Group.

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(f)    No Waiver.  Any failure by the Company to assert the forfeiture and repayment rights under this paragraph with respect to specific claims against the Grantee shall not waive, or operate to waive, the Company’s right to later assert its rights hereunder with respect to other or subsequent claims against the Grantee.  
(g)    No Limitation on Remedies.  The Company’s forfeiture and repayment rights under this paragraph shall be in addition to, and not in lieu of, actions the Company may take to remedy or discipline any misconduct by the Grantee including, but not limited to, termination of employment or initiation of appropriate legal action.  
(h)    Grantee Acknowledgement and Agreement.  Without limiting the generality of any other provision herein regarding the Grantee’s understanding of and agreement to the terms and conditions of this Agreement, Appendix A and Appendix B, by signing this Agreement, the Grantee specifically acknowledges that he or she has read and understands this paragraph 8 and agrees to the terms and conditions of this paragraph, including but not limited to the forfeiture and repayment provisions of paragraph 8(a).
9.Death of Grantee.  In the event that the Grantee ceases to be an Employee due to his or her death prior to the Vesting Date, any then outstanding but unvested Restricted Stock Units will vest and be settled by the Company through the issuance of Shares to the administrator or executor of the Grantee’s estate, on a date as soon as practicable after the date of the Grantee’s death.  The Company may require any administrator or executor of the Grantee’s estate to furnish (a) written notice of his or her status as transferee, or (b) evidence satisfactory to the Company to establish the validity of the transfer and compliance with Applicable Laws pertaining to the transfer of the Shares underlying the Restricted Stock Units. 
10.Disability of Grantee.  In the event that the Grantee ceases to be an Employee due to his or her Disability prior to the Vesting Date, any then outstanding but unvested Restricted Stock Units will vest and be settled by the Company through the issuance of Shares to the Grantee on a date as soon as practicable after the date of the Grantee’s Disability.    
11.Retirement of Grantee.  In the event that the Grantee ceases to be an Employee due to his or her Retirement (as defined below) prior to the Vesting Date, any then outstanding but unvested Restricted Stock Units will vest and be settled by the Company through the issuance of Shares to the Grantee on a date as soon as practicable after the date of the Grantee’s Retirement.  For the purposes of this Agreement, “Retirement” shall mean a termination of employment by the Company for any reason, other than “Cause” (as defined below in paragraph 12), after attaining age fifty-five (55) and after having at least ten (10) years of continuous service with the Company.  For avoidance of doubt, a Grantee’s election to voluntarily terminate his or her employment due to Retirement or any other reason will not entitle the Grantee to vesting and settlement of the Restricted Stock Units as otherwise contemplated by this Section 11.    
12.Termination of Employment for Cause.  In the event that the Grantee’s employment is terminated by the Company for “Cause” (as defined below) prior to the Vesting Date, then any then outstanding but unvested Restricted Stock Units immediately will terminate and be forfeited back to the Plan at no cost to the Company.  For the purposes of this Agreement, “Cause” shall mean 

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the Grantee’s: (a) failure to substantially perform his or her duties as an Employee, other than due to illness, injury or Disability; (b) willful engaging in conduct which is materially injurious to the Company; (c) misconduct involving serious moral turpitude, or any conviction of, or plea of nolo contendre to, a criminal offense arising out of a breach of trust, embezzlement or fraud committed against the Company by the Grantee in the course of the Grantee’s employment with the Company; (d) any violation of paragraph 14 of this Appendix A; or (e) any other action which might be considered “gross misconduct” under the Company’s applicable associate handbook. 
13.Termination of Employment following Change of Control.  In the event that the Grantee’s employment is terminated by the Company for any reason, other than for Cause (as defined above) within twenty-four (24) months following a Change of Control and prior to the Vesting Date, any then outstanding but unvested Restricted Stock Units will vest and be settled by the Company through the issuance of Shares to the Grantee on a date as soon as practicable after the date of the Grantee’s termination of employment.    
14.Non-solicitation and Non-competition.  The receipt of any Shares pursuant to this award will be subject to the Grantee, for the period of his or her employment with the Company and for a period the greater of either, twelve months or such period of time set forth in the Grantee’s associate agreement, after the termination of his or her employment with the Company, not: (i) directly or indirectly soliciting customers of the Company in an attempt to have such customers cease their relationship with the Company, (ii) soliciting any employee of the Company for employment with any employer other than the Company, or (iii) directly or indirectly engaging in, having any ownership interest in or participating in the management or operation of any entity that, as of the date of termination, is engaged in any activities or which offers products or services which are or may be deemed to be competitive with those products or services offered by the Company (a “Competitive Business”), unless otherwise expressly approved in writing by the Company.  The term “Competitive Business” is further defined as a business within any state in the United States where the Company conducts business (as an owner, partner, stockholder, holder of any other equity interest, or financially as an investor or lender, or in any capacity calling for the rendition of personal services or acts of management, operation or control) providing brokerage, advisory, custodial and wealth management services to the public, including, but not limited to, services, products and technology to support retail (long term investor or active trader) or institutional trading and investing platforms, and Registered Investment Advisor custodial business products and services, and also includes any such other business formally proposed to be offered to the public by the Company during the twelve (12) month period immediately prior to the date of termination.  To the extent the Grantee has violated any term and condition of this paragraph 14, the Restricted Stock Units prior to settlement shall be forfeited pursuant to paragraph 7 and if Shares of Company Stock have already been issued to the Grantee, then the Grantee shall be required to either return the Shares or forfeit any gain recognized by the Grantee from the sale of such Shares.  In the event that any of the provisions of this Section should ever be deemed to exceed the scope and duration limitations permitted by applicable laws, then such provisions will and are hereby reformed to the maximum limitations permitted by applicable law.     
15.    Withholding of Taxes.  When the Shares are issued in settlement for vested Restricted Stock Units, the Grantee will recognize immediate U.S. taxable income if the Grantee is a U.S. taxpayer.  If the Grantee is a non-U.S. taxpayer, the Grantee will be subject to applicable taxes in his 

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or her jurisdiction.  The Company (or the employing Related Entity) will withhold a portion of the Shares or cash otherwise issuable in settlement for vested Restricted Stock Units that have an aggregate market value sufficient to pay the minimum federal, state and local income, employment and any other applicable taxes required to be withheld by the Company (or the employing Related Entity) with respect to the Shares.  Withholding will occur at the time that the Company (or the employing Related Entity) determines is necessary or appropriate to comply with applicable law, which may be before the Restricted Stock Units are due to be settled.  No fractional Shares will be withheld or issued pursuant to the grant of Restricted Stock Units and the issuance of Shares thereunder.  By accepting this Award, the Grantee expressly consents to the withholding of Shares as provided for in this paragraph 15.  All income and other taxes and withholding related to the Restricted Stock Unit award and any Shares delivered in payment thereof are the sole responsibility of the Grantee.
16.    Rights as Stockholder.  Except as provided pursuant to the Dividend Equivalent Rights provided in paragraph 30, neither the Grantee nor any person claiming under or through the Grantee shall have any of the rights or privileges of a stockholder of the Company in respect of any Shares deliverable hereunder unless and until certificates representing such Shares (which may be in book entry form) shall have been issued, recorded on the records of the Company or its transfer agents or registrars, and delivered to the Grantee (including through electronic delivery to a brokerage account) after the Vesting Date.  After such issuance, recordation and delivery, the Grantee will have all the rights of a stockholder of the Company with respect to voting such Shares and receipt of dividends and distributions on such Shares. 
17.    No Effect on Employment or Service.  The Grantee acknowledges and agrees that this Agreement and Appendix A and B and the transactions contemplated hereunder do not constitute an express or implied promise of continued service or employment as an Employee for any period, or at all, and shall not interfere with the Grantee’s right or the Company’s (or employing Related Entity’s) right to terminate the Grantee’s relationship as an Employee at any time, with or without Cause.
18.    Address for Notices.  Any notice to be given to the Company under the terms of this Agreement shall be addressed to the Company, in care of its General Counsel, at 6940 Columbia Gateway Drive, Suite 200, Columbia, Maryland 21046, or at such other address as the Company may hereafter designate in writing. 
19.    Grant is Not Transferable.  Except to the limited extent provided in paragraph 9 above, this grant and the rights and privileges conferred hereby shall not be transferred, assigned, pledged or hypothecated in any way (whether by operation of law or otherwise) and shall not be subject to sale under execution, attachment or similar process.  Upon any attempt to transfer, assign, pledge, hypothecate or otherwise dispose of this grant, or of any right or privilege conferred hereby, or upon any attempted sale under any execution, attachment or similar process, this grant and the rights and privileges conferred hereby immediately shall become null and void.
20.    Restrictions on Sale of Stock.  The Shares issued as settlement for the payment for any vested Restricted Stock Units awarded under this Agreement will be registered under the federal securities laws and will be freely tradable upon receipt.  However, the Grantee’s subsequent sale of the Shares will be subject to paragraph 8(d) above, any market blackout-period that may be imposed 

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by the Company and must comply with the Company’s insider trading policies, and any other applicable securities laws.  In addition, the Shares issued as settlement for the payment of any vested Restricted Stock Units awarded under this Agreement will also be subject to any applicable ownership guidelines and Share ownership holding periods which may be currently in effect under the Company’s trading policy.
21.    Binding Agreement.  Subject to the limitation on the transferability of this grant contained herein, this Agreement shall be binding upon and inure to the benefit of the heirs, legatees, legal representatives, successors and assigns of the parties hereto.
22.    Conditions for Issuance of Certificates for Stock.  The Shares deliverable to the Grantee may be either previously authorized but unissued Shares or issued Shares which have been reacquired by the Company.  The Company shall not be required to issue any certificate or certificates for Shares hereunder prior to fulfillment of all the following conditions:  (a) the admission of such Shares to listing on all stock exchanges on which such class of stock is then listed; and (b) the completion of any registration or other qualification of such Shares under any state or federal law or under the rulings or regulations of the Securities and Exchange Commission or any other governmental regulatory body, which the Committee shall, in its absolute discretion, deem necessary or advisable; and (c) the obtaining of any approval or other clearance from any state or federal governmental agency, which the Committee shall, in its absolute discretion, determine to be necessary or advisable; provided that issuance of certificates for Shares hereunder is to be made in no event later than the thirtieth (30th) day following the Vesting Date.  
23.    Plan Governs.  This Agreement and Appendix A and B is subject to all terms and provisions of the Plan.  In the event of a conflict between one or more provisions of this Agreement and Appendix A and B and one or more provisions of the Plan, the provisions of the Plan shall govern.  Capitalized terms used and not defined in this Agreement and Appendix A and B shall have the meaning set forth in the Plan.
24.    Committee Authority.  The Committee shall have the power to interpret the Plan and this Agreement and Appendix A and B and to adopt such rules for the administration, interpretation and application of the Plan as are consistent therewith and to interpret or revoke any such rules (including, but not limited to, the determination of whether or not any Restricted Stock Units have vested).  All actions taken and all interpretations and determinations made by the Committee shall be final and binding upon the Grantee, the Company and all other persons.  The Committee shall not be personally liable for any action, determination or interpretation made in good faith with respect to the Plan or this Agreement and Appendix A and B.
25.    Captions.  Captions provided herein are for convenience only and are not to serve as a basis for interpretation or construction of this Agreement and Appendix A and B.
26.    Agreement Severable.  In the event that any provision in this Agreement and Appendix A and B shall be held invalid or unenforceable, such provision shall be severable from, and such invalidity or unenforceability shall not be construed to have any effect on, the remaining provisions of this Agreement and Appendix A and B.

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27.    Entire Agreement.  Other than to the extent any written employment agreement between the Grantee and the Company provides for (a) treatment different or (b) the definition of terms different, than that which is provided by this Agreement and Appendix A and B, this Agreement and Appendix A and B constitutes the entire understanding of the parties on the subjects covered.  The Grantee expressly warrants that he or she is not executing this Agreement and Appendix A and B in reliance on any promises, representations, or inducements other than those contained herein.
28.    Modifications to the Agreement.  The Grantee expressly warrants that he or she is not accepting this Agreement in reliance on any promises, representations, or inducements other than those contained herein.  Modifications to this Agreement or the Plan can be made only in an express written contract executed by a duly authorized officer of the Company. 
29.    Amendment, Suspension or Termination of the Plan.  By accepting this award, the Grantee expressly warrants that he or she has a right to receive Shares under, and subject to the terms and conditions of, the Plan and this Agreement and Appendix A and B, and has received, read and understood the Plan and this Agreement and Appendix A and B.  The Grantee understands that the Plan is discretionary in nature and may be modified, suspended or terminated by the Company at any time.
30.    Dividend Equivalent Rights.  If the Company declares and pays a cash dividend on Shares for which the record date occurs while Restricted Stock Units subject to this Agreement remain outstanding, then additional Restricted Stock Units (referred to as “DEUs”) will be credited under this Agreement in accordance with this paragraph 30, but only if the Grantee remains an Employee continuously through the applicable record date for that cash dividend.  Subject to the provisions of this paragraph 30, the number of DEUs that will be credited under this Agreement for a cash dividend will be determined by the following formula: X  =  (A x B) / C; where: 
		
	•
	“X” is the number of whole DEUs to be credited (which will be rounded down to the next whole number. No fractional number of DEUs will be credited pursuant to this paragraph 30). 

		
	•
	“A” is the amount of cash dividends paid by the Company to stockholders with respect to one Share. 

		
	•
	“B” is the number of whole Restricted Stock Units (including DEUs) remaining subject to this Agreement as of the cash dividend record date but immediately prior to the application of this paragraph 30 for that cash dividend. 

		
	•
	“C” is the Fair Market Value of a Share on the cash dividend payment date.  

Any DEUs credited under this paragraph 30 will be scheduled to vest as follows:  an installment of the DEUs will vest on each scheduled vesting date under the Award, with the portion of the DEUs that will vest in a particular installment equal in proportion to the portion of the original Award scheduled to vest on the applicable vesting date.  However, the following exception applies:  if a vesting date for the Award already occurred before the cash dividend payment date, then the 

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installment of DEUs that would have vested on the vesting date that already passed instead will be scheduled to vest on the next vesting date under the Award occurring after the cash dividend payment date.  On any vesting date, DEUs will vest only if the Grantee remains an Employee continuously through that vesting date.
In all other respects, DEUs credited under this paragraph 30 will be subject to the same terms and conditions and (except as provided further below in this paragraph 30) will be settled in the same manner and at the same time as the other Shares underlying the Restricted Stock Units on which the DEUs were paid. 
Example.  For purposes of illustration and as an example only, assume that on January 5, 2016, a Grantee receives an Award of Restricted Stock Units covering a total of 1,000 Shares.  These 1,000 Restricted Stock Units are scheduled to vest as to 333 on each of the one (1) and two (2) year anniversaries of the grant date, and as to 334 on the three (3) year anniversary of the grant date, in each case subject to the Grantee remaining an Employee continuously through the applicable vesting dates.  
		
	•
	Assume also that on May 10, 2016, when all of the Restricted Stock Units under the Award remain unvested, a cash dividend payment date occurs, and a cash amount equal to the then‐Fair Market Value of 100 Shares becomes payable on the Award.  Accordingly, 100 DEUs will be credited to the Award, and those DEUs will be scheduled to vest as to 33 DEUs on each of the one (1) and two (2) year anniversaries of the Award’s grant date and as to 34 DEUs on the three (3) year anniversary of the grant date, but in each case only if the Grantee remains an Employee continuously through the applicable vesting dates.

		
	•
	Assume further that on May 10, 2017, when a total of 667 Restricted Stock Units remain unvested and subject to the Award, a second cash dividend payment date occurs, and a cash amount equal to the then‐Fair Market Value of 73 Shares becomes payable on the Award.  Accordingly, 73 DEUs will be credited to the Award, and those DEUs will be scheduled to vest as to 48 DEUs on the two (2) year anniversary of the Award and as to 25 DEUs on the three (3) year anniversary of the Award, but in each case only if the Grantee remains an Employee continuously through the applicable vesting dates. 

		
	•
	Assume lastly that on May 10, 2018, when a total of 334 Restricted Stock Units remain unvested and subject to the Award, a third cash dividend payment date occurs, and a cash amount equal to the then‐Fair Market Value of 39 Shares becomes payable on the Award.  Accordingly, 39 DEUs are credited to the Award, and those DEUs will be scheduled to vest in full on the three (3) year anniversary of the Award, but only if the Grantee remains an Employee continuously through that vesting date.

The following table briefly summarizes the Example described above: 
	
					
	Cash Dividend Payment Date
	Number of DEUs Credited on Cash Dividend Payment Date
	Number of DEUs Scheduled to Vest on January 5, 2017
	Number of DEUs Scheduled to Vest on January 5, 2018
	Number of DEUs Scheduled to Vest on January 5, 2019

	May 10, 2016
	100
	33
	33
	34

	May 10, 2017
	73
	—
	48
	25

	May 10, 2018
	39
	—
	—
	39

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31.    Code Section 409A.  Notwithstanding anything to the contrary in the Agreement, Appendix A and B and/or the Plan, if the Company reasonably determines that Section 409A of the Code will result in the imposition of additional tax with respect to the settlement of the Shares underlying the Restricted Stock Units on account of the Grantee’s separation from service (as defined in Section 409A of the Code), the Shares (and/or at the election of the Grantee the cash received from the sale of the Shares underlying the vested Restricted Stock Units) will not be paid to the Grantee until the date six (6) months and one (1) day following the date of the Grantee’s separation from service.
32.    Notice of Governing Law.  This grant of Restricted Stock Units shall be governed by, and construed in accordance with, the laws of the State of Nebraska without regard to principles of conflict of laws.

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APPENDIX B

VESTING SCHEDULE 
OF RESTRICTED STOCK UNITS

The vesting of the Restricted Stock Units subject to this award shall be determined based on the following schedule (except as otherwise provided in Appendix A):  
The Vesting Date for thirty three percent (33%) of the Restricted Stock Units will be the first (1st) anniversary of the Date of Grant; the Vesting Date for an additional thirty three percent (33%) of the Restricted Stock Units will be the second (2nd) anniversary of the Date of Grant; and the Vesting Date for the final thirty four percent (34%) of the Restricted Stock Units will be the third (3rd) anniversary of the Date of Grant, so that one hundred percent (100%) of the Restricted Stock Units shall become vested by the third (3rd) anniversary of the Date of Grant.  
The Settlement Date, when the vested Restricted Stock Units, if any, will be settled by issuing Shares to the Grantee shall be the date, as soon as reasonably practicable following the applicable date on which the Restricted Stock Units vested in accordance with the terms of the Plan, the Agreement and this Appendix B, but in no event later than the thirtieth (30th) day following such date.  

-11-Exhibit 4.13

 

Exhibit 1

 

SERIES C COMMON STOCK WARRANT
CERTIFICATE

 

SONOMA PHARMACEUTICALS, INC.

 

	Warrant Shares: _______	Initial
Exercise Date:   ___, 2018
	Warrant Number: ___	 

 

CUSIP:
83558L139

 

THIS SERIES C COMMON
STOCK PURCHASE WARRANT CERTIFICATE (the “Warrant”) certifies that, for value received, Cede & Co. or its
assigns (the “Holder”) is entitled, upon the terms and subject to the limitations on exercise and the conditions
hereinafter set forth, at any time on or after [●], 2018 (the “Initial Exercise Date”) and on or prior
to the Close of Business on the five (5) year anniversary of the Initial Exercise Date, or [●], 2023 (the “Termination
Date”) but not thereafter, to subscribe for and purchase from Sonoma Pharmaceuticals, Inc., a Delaware corporation (the
“Company”), up to [●] shares (as subject to adjustment hereunder, the “Warrant Shares”)
of Common Stock. The purchase price of one share of Common Stock under this Warrant shall be equal to the Exercise Price, as defined
in Section 2(b). This Warrant shall initially be issued and maintained in the form of a security held in book-entry form and the
Depository Trust Company or its nominee (“DTC”) shall initially be the sole registered holder of this Warrant,
subject to a Holder’s right to elect to receive a Warrant in certificated form pursuant to the terms of the Warrant Agency
Agreement, in which case this sentence shall not apply.

 

Section 1.      Definitions.
The following terms shall have the meanings indicated in this Section 1:

 

“Affiliate”
has the meaning ascribed to it in Rule 12b-2 under the Exchange Act.

 

“Board
of Directors” means the board of directors of the Company.

 

“Business
Day” means any day except any Saturday, any Sunday, any day which is a federal legal holiday in the United States or
any day on which The Nasdaq Stock Market is authorized or required by law or other governmental action to close.

 

“Close
of Business” on any given date means 5:00 p.m., New York City time, on such date; provided, however, that if such date
is not a Business Day it means 5:00 p.m., New York City time, on the next succeeding Business Day.

 

“Commission”
means the United States Securities and Exchange Commission.

 

“Common
Stock” means the common stock of the Company, par value $0.0001 per share, and any other class of securities into which
such securities may hereafter be reclassified or changed.

 

“Common
Stock Equivalents” means any securities of the Company or the Subsidiaries which would entitle the holder thereof to
acquire at any time Common Stock, including, without limitation, any debt, preferred stock, right, option, warrant or other instrument
that is at any time convertible into or exercisable or exchangeable for, or otherwise entitles the holder thereof to receive,
Common Stock.

 

“Exchange
Act” means the Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder.

 

“Person”
means an individual, corporation, association, partnership, limited liability company, joint venture, trust, unincorporated organization,
government or political subdivision thereof or governmental agency or other entity.

 

“Registration
Statement” means the Company’s registration statement on Form S-1 (File No. 333-227806).

 

“Securities
Act” means the Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder.

 

 

 

 

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“Subsidiary”
means any subsidiary of the Company and shall, where applicable, also include any direct or indirect subsidiary of the Company
formed or acquired after the date hereof.

 

“Trading
Day” means a day on which the principal Trading Market is open for business.

 

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

 

“Transfer
Agent” means Computershare, Inc., the current transfer agent of the Company, with a mailing address of _________________,
a phone number of ________________, and an e-mail address of __________________, and any successor transfer agent of the Company.

 

“Warrant
Agency Agreement” means that certain warrant agency agreement, dated as of the Initial Exercise Date, among the Company
and the Warrant Agent.

 

“Warrant
Agent” means, collectively, Computershare, Inc., a Delaware corporation, and its wholly-owned subsidiary, Computershare
Trust Company, N.A., a federally chartered trust company, and any successor warrant agent of the Company.

 

“Warrants”
means this Warrant and other Series C Common Stock Purchase Warrants issued by the Company pursuant to the Registration Statement.

 

Section 2.      Exercise.

 

a)        Exercise
of Warrant.  Subject to the provisions of Section 2(e) and (f) herein, exercise of the purchase rights represented by this
Warrant may be made, in whole or in part, at any time or times on or after the Initial Exercise Date and on or before the Termination
Date by delivery to the Company or Warrant Agent of a properly completed and duly executed Notice of Exercise in the form annexed
hereto (the “Notice of Exercise”). Within the earlier of (i) by 12:00 p.m. Eastern Time on the second Trading
Day and (ii) the number of Trading Days comprising the Standard Settlement Period (as defined in Section 2(e)(i) herein) following
the date of exercise as aforesaid, the Holder shall deliver the aggregate Exercise Price for the shares specified in the applicable
Notice of Exercise by wire transfer or certified, official or cashier’s check drawn on a United States bank unless the Cashless
Exercise procedure specified in Section 2(c) below is specified in the applicable Notice of Exercise. Provided the Warrant is
in book entry or electronic form through DTC (or any successor depositary), no ink-original Notice of Exercise shall be required,
nor shall any medallion guarantee (or other type of guarantee or notarization) of any Notice of Exercise be required. Notwithstanding
anything herein to the contrary, provided the Warrant is in book entry or electronic form through DTC (or any successor depositary),
the Holder shall not be required to physically surrender this Warrant to the Company until the Holder has purchased all of the
Warrant Shares available hereunder and the Warrant has been exercised in full, in which case, the Holder shall surrender this
Warrant to the Company for cancellation within three (3) Trading Days of the date on which the final Notice of Exercise is delivered
to the Company. Partial exercises of this Warrant resulting in purchases of a portion of the total number of Warrant Shares available
hereunder shall have the effect of lowering the outstanding number of Warrant Shares purchasable hereunder in an amount equal
to the applicable number of Warrant Shares purchased. The Holder and the Warrant Agent shall maintain records showing the number
of Warrant Shares purchased and the date of such purchases. The Company shall deliver any objection to any Notice of Exercise
within one (1) Business Day of receipt of such notice. The Holder and any assignee, by acceptance of this Warrant, acknowledge
and agree that, by reason of the provisions of this paragraph, following the purchase of a portion of the Warrant Shares hereunder,
the number of Warrant Shares available for purchase hereunder at any given time may be less than the amount stated on the face
hereof.

 

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Notwithstanding
the foregoing in this Section 2(a), a holder whose interest in this Warrant is a beneficial interest in certificate(s) representing
this Warrant held in book-entry form through DTC (or another established clearing corporation performing similar functions), shall
effect exercises made pursuant to this Section 2(a) by delivering to DTC (or such other clearing corporation, as applicable) the
appropriate instruction form for exercise, complying with the procedures to effect exercise that are required by DTC (or such other
clearing corporation, as applicable), subject to a Holder’s right to elect to receive a Warrant in certificated form pursuant
to the terms of the Warrant Agency Agreement, in which case this sentence shall not apply. Notwithstanding anything herein to the
contrary, in connection with an exercise of this Warrant by a holder whose interest in this Warrant is a beneficial interest in
certificate(s) representing this Warrant held in book-entry form through DTC (or another established clearing corporation performing
similar functions) that effect exercises through DTC, there shall be no obligation whatsoever at any time for such holder to deliver
any ink-original Notice of Exercise or any medallion guarantee (or other type of guarantee or notarization) of a Notice of Exercise. 

 

b)        Exercise
Price. The exercise price per share of the Common Stock under this Warrant shall be US$[_____], subject to adjustment
hereunder (the “Exercise Price”). Without limiting the rights of a Holder to receive Warrant Shares on a “cashless
exercise” and to receive cash payments contemplated pursuant to Sections 2(e)(i) and 2(e)(iv), in no event shall the Company
be required to net cash settle any Warrant.

 

c)        Cashless
Exercise. If at any time after the Initial Exercise Date, there is no effective registration statement registering, or no
current prospectus available for, the issuance of the Warrant Shares to the Holder, then this Warrant may only be exercised, in
whole or in part, at such time by means of a “cashless exercise” in which the Holder shall be entitled to receive
a number of Warrant Shares equal to the quotient obtained by dividing [(A-B) (X)] by (A), where:

 

(A) = as applicable:
(i) the VWAP on the Trading Day immediately preceding the date of the applicable Notice of Exercise if such Notice of Exercise
is (1) both executed and delivered pursuant to Section 2(a) hereof on a day that is not a Trading Day or (2) both executed and
delivered pursuant to Section 2(a) hereof on a Trading Day prior to the opening of “regular trading hours” (as defined
in Rule 600(b)(64) of Regulation NMS promulgated under the federal securities laws) on such Trading Day, (ii) at the option of
the Holder, either (y) the VWAP on the Trading Day immediately preceding the date of the applicable Notice of Exercise or (z) the
Bid Price of the Common Stock on the principal Trading Market as reported by Bloomberg L.P. as of the time of the Holder’s
execution of the applicable Notice of Exercise if such Notice of Exercise is executed during “regular trading hours”
on a Trading Day and is delivered within two (2) hours thereafter (including until two (2) hours after the close of “regular
trading hours” on a Trading Day) pursuant to Section 2(a) hereof or (iii) the VWAP on the date of the applicable Notice of
Exercise if the date of such Notice of Exercise is a Trading Day and such Notice of Exercise is both executed and delivered pursuant
to Section 2(a) hereof after the close of “regular trading hours” on such Trading Day;

 

(B) = the
Exercise Price of this Warrant, as adjusted hereunder; and

 

(X) =
the number of Warrant Shares that would be issuable upon exercise of this Warrant in accordance with the terms of this Warrant
if such exercise were by means of a cash exercise rather than a cashless exercise.

 

If
Warrant Shares are issued in such a cashless exercise, the parties acknowledge and agree that in accordance with Section 3(a)(9)
of the Securities Act, the Warrant Shares shall take on the registered characteristics of the Warrants being exercised.  The
Company agrees not to take any position contrary to this Section 2(c).

 

“VWAP”
means, for any date, the price determined by the first of the following clauses that applies: (a) if the Common Stock is then listed
or quoted on a Trading Market, the daily volume weighted average price of the Common Stock for such date (or the nearest preceding
date) on the Trading Market on which the Common Stock is then listed or quoted as reported by Bloomberg L.P. (based on a Trading
Day from 9:30 a.m. (New York City time) to 4:02 p.m. (New York City time)), (b)  if OTCQB or OTCQX is not a Trading Market,
the volume weighted average price of the Common Stock for such date (or the nearest preceding date) on OTCQB or OTCQX as applicable,
(c) if the Common Stock is not then listed or quoted for trading on OTCQB or OTCQX and if prices for the Common Stock are then
reported in the “Pink Sheets” published by OTC Markets, Inc. (or a similar organization or agency succeeding to its
functions of reporting prices), the most recent bid price per share of the Common Stock so reported, or (d) in all other cases,
the fair market value of a share of Common Stock as determined by an independent appraiser selected in good faith by the holders
of a majority in interest of the Warrants then outstanding and reasonably acceptable to the Company, the fees and expenses of which
shall be paid by the Company.

 

 

 

 

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“Bid
Price” means, for any date, the price determined by the first of the following clauses that applies: (a) if the Common
Stock is then listed or quoted on a Trading Market, the bid price of the Common Stock for the time in question (or the nearest
preceding date) on the Trading Market on which the Common Stock is then listed or quoted as reported by Bloomberg L.P. (based on
a Trading Day from 9:30 a.m. (New York City time) to 4:02 p.m. (New York City time)), (b)  if OTCQB or OTCQX is not a Trading
Market, the volume weighted average price of the Common Stock for such date (or the nearest preceding date) on OTCQB or OTCQX as
applicable, (c) if the Common Stock is not then listed or quoted for trading on OTCQB or OTCQX and if prices for the Common Stock
are then reported in the “Pink Sheets” published by OTC Markets Group, Inc. (or a similar organization or agency succeeding
to its functions of reporting prices), the most recent bid price per share of the Common Stock so reported, or (d) in all
other cases, the fair market value of a share of Common Stock as determined by an independent appraiser selected in good faith
by the Purchasers of a majority in interest of the Securities then outstanding and reasonably acceptable to the Company, the fees
and expenses of which shall be paid by the Company.

 

d)        For
the avoidance of doubt, in the event of any exercise of Warrants on a “cashless basis”, the Company shall be solely
responsible for calculating the number of shares of Common Stock issuable in connection with such cashless exercise and transmitting
such calculation in a written notice to the Warrant Agent and the exercising Holder, and the Warrant Agent shall have no duty,
responsibility or obligation to calculate or determine the number of Common Stock issuable in connection with such cashless exercise,
or to investigate or confirm whether the Company’s calculation or determination of the number of shares of Common Stock
to be issued in connection with such cashless exercise is accurate or correct. The Warrant Agent shall have no duty, obligation
or responsibility with respect to any cashless exercise of Warrants until it receives such written notice from the Company, and
shall be entitled to rely conclusively on any such written notice provided by the Company, including the calculations and determinations
contained therein, and the Warrant Agent shall not be liable for any action taken, suffered or omitted to be taken by it in accordance
with such written instructions, while waiting for such written instructions, or pursuant to this Agreement. In the event of an
exercise of any Warrant, the Company shall provide the cost basis for shares issued pursuant to such exercise at the time such
shares are issued. Notwithstanding the foregoing, nothing in this Section 2(d) shall affect or limit the obligations of the Company
pursuant to this Warrant.

 

e)        Mechanics of Exercise.

 

i.           
Delivery of Warrant Shares Upon Exercise. The Company shall cause the Warrant Shares purchased hereunder to be transmitted
by the Transfer Agent to the Holder by crediting the account of the Holder’s or its designee’s balance account with
The Depository Trust Company through its Deposit or Withdrawal at Custodian system (“DWAC”) if the Company is
then a participant in such system and either (A) there is an effective registration statement permitting the issuance of the Warrant
Shares to or resale of the Warrant Shares by the Holder or (B) this Warrant is being exercised via cashless exercise, and otherwise
by physical delivery of a certificate, registered in the Company’s share register in the name of the Holder or its designee,
for the number of Warrant Shares to which the Holder is entitled pursuant to such exercise to the address specified by the Holder
in the Notice of Exercise by the date that is the earliest of (i) two (2) Trading Days after the delivery to the Company of the
Notice of Exercise, (ii) one (1) Trading Day after delivery of the aggregate Exercise Price to the Company and (iii) the number
of Trading Days comprising the Standard Settlement Period after the delivery to the Company of the Notice of Exercise (such date,
the “Warrant Share Delivery Date”). Upon delivery of the Notice of Exercise the Holder shall be deemed for all
corporate purposes to have become the holder of record of the Warrant Shares with respect to which this Warrant has been exercised,
irrespective of the date of delivery of the Warrant Shares; provided that payment of the aggregate Exercise Price (other than in
the case of a cashless exercise) is received within the earlier of (i) by 12:00 p.m. Eastern Time on the third Trading Day and
(ii) the number of Trading Days comprising the Standard Settlement Period following delivery of the Notice of Exercise. If the
Company fails for any reason to deliver to the Holder the Warrant Shares subject to a Notice of Exercise by the Warrant Share Delivery
Date, the Company shall pay to the Holder, in cash, as liquidated damages and not as a penalty, for each $1,000 of Warrant Shares
subject to such exercise (based on the VWAP of the Common Stock on the date of the applicable Notice of Exercise), $10 per Trading
Day (increasing to $20 per Trading Day on the fifth Trading Day after such liquidated damages begin to accrue) for each Trading
Day after such Warrant Share Delivery Date until such Warrant Shares are delivered or Holder rescinds such exercise. The Company
agrees to maintain a transfer agent that is a participant in the FAST program so long as this Warrant remains outstanding and exercisable.
As used herein, “Standard Settlement Period” means the standard settlement period, expressed in a number of
Trading Days, on the Company’s primary Trading Market with respect to the Common Stock as in effect on the date of delivery
of the Notice of Exercise. In no event shall the Warrant Agent be liable for the Company’s failure to deliver the Warrant
Shares by the Warrant Share Delivery Date.

 

 

 

 

 

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ii.             Delivery
of New Warrants Upon Exercise. If this Warrant shall have been exercised in part, the Company shall, at the request of a Holder
and upon surrender of this Warrant certificate, at the time of delivery of the Warrant Shares, deliver to the Holder a new Warrant
evidencing the rights of the Holder to purchase the unpurchased Warrant Shares called for by this Warrant, which new Warrant shall
in all other respects be identical with this Warrant.

 

iii.          Rescission Rights. If the Company fails to cause the Transfer Agent to transmit to the Holder the Warrant Shares
pursuant to Section 2(e)(i) by the Warrant Share Delivery Date, then the Holder will have the right to rescind such exercise.

 

iv.         Compensation
for Buy-In on Failure to Timely Deliver Warrant Shares Upon Exercise. In addition to any other rights available to the Holder,
if the Company fails to cause the Transfer Agent to transmit to the Holder the Warrant Shares in accordance with the provisions
of Section 2(e)(i) above pursuant to an exercise on or before the Warrant Share Delivery Date (other than any such failure that
is solely due to any action or inaction by the Holder with respect to such exercise), and if after such date the Holder is required
by its broker to purchase (in an open market transaction or otherwise) or the Holder’s brokerage firm otherwise purchases,
shares of Common Stock to deliver in satisfaction of a sale by the Holder of the Warrant Shares which the Holder anticipated receiving
upon such exercise (a “Buy-In”), then the Company shall (A) pay in cash to the Holder the amount, if any, by
which (x) the Holder’s total purchase price (including brokerage commissions, if any) for the shares of Common Stock so
purchased exceeds (y) the amount obtained by multiplying (1) the number of Warrant Shares that the Company was required to deliver
to the Holder in connection with the exercise at issue times (2) the price at which the sell order giving rise to such purchase
obligation was executed, and (B) at the option of the Holder, either reinstate the portion of the Warrant and equivalent number
of Warrant Shares for which such exercise was not honored (in which case such exercise shall be deemed rescinded) or deliver to
the Holder the number of shares of Common Stock that would have been issued had the Company timely complied with its exercise
and delivery obligations hereunder. For example, if the Holder purchases Common Stock having a total purchase price of $11,000
to cover a Buy-In with respect to an attempted exercise of shares of Common Stock with an aggregate sale price giving rise to
such purchase obligation of $10,000, under clause (A) of the immediately preceding sentence the Company shall be required to pay
the Holder $1,000. The Holder shall provide the Company written notice indicating the amounts payable to the Holder in respect
of the Buy-In and, upon request of the Company, evidence of the amount of such loss. Nothing herein shall limit a Holder’s
right to pursue any other remedies available to it hereunder, at law or in equity including, without limitation, a decree of specific
performance and/or injunctive relief with respect to the Company’s failure to timely deliver shares of Common Stock upon
exercise of the Warrant as required pursuant to the terms hereof.

 

v.          No
Fractional Shares or Scrip. No fractional shares or scrip representing fractional shares shall be issued upon the exercise
of this Warrant. As to any fraction of a share which the Holder would otherwise be entitled to purchase upon such exercise, the
Company shall, at its election, either pay a cash adjustment in respect of such final fraction in an amount equal to such fraction
multiplied by the Exercise Price or round up to the next whole share.

 

vi.         Charges,
Taxes and Expenses. Issuance of Warrant Shares shall be made without charge to the Holder for any issue or transfer tax or
other incidental expense in respect of the issuance of Warrant Shares, all of which taxes and expenses shall be paid by the Company,
and such Warrant Shares shall be issued in the name of the Holder or in such name or names as may be directed by the Holder; provided,
however, that in the event that Warrant Shares are to be issued in a name other than the name of the Holder, this Warrant
when surrendered for exercise shall be accompanied by the Assignment Form attached hereto duly executed by the Holder and the
Company may require, as a condition thereto, the payment of a sum sufficient to reimburse it for any transfer tax incidental thereto.
The Company shall pay all Transfer Agent fees required for same-day processing of any Notice of Exercise and all fees to the Depository
Trust Company (or another established clearing corporation performing similar functions) required for same-day electronic delivery
of the Warrant Shares.

 

vii.        Closing
of Books. The Company will not close its stockholder books or records in any manner which prevents the timely exercise of
this Warrant, pursuant to the terms hereof.

 

 

 

 

 

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f)        Holder’s
Exercise Limitations. The Company shall not effect any exercise of this Warrant, and a Holder shall not have the right to
exercise any portion of this Warrant, pursuant to Section 2 or otherwise, to the extent that after giving effect to such issuance
after exercise as set forth on the applicable Notice of Exercise, the Holder (together with the Holder’s Affiliates, and
any other Persons acting as a group together with the Holder or any of the Holder’s Affiliates (such Persons, “Attribution
Parties”)), would beneficially own in excess of the Beneficial Ownership Limitation (as defined below).  For purposes
of the foregoing sentence, the number of shares of Common Stock beneficially owned by the Holder and its Affiliates and Attribution
Parties shall include the number of shares of Common Stock issuable upon exercise of this Warrant with respect to which such determination
is being made, but shall exclude the number of shares of Common Stock which would be issuable upon (i) exercise of the remaining,
nonexercised portion of this Warrant beneficially owned by the Holder or any of its Affiliates or Attribution Parties and (ii)
exercise or conversion of the unexercised or nonconverted portion of any other securities of the Company (including, without limitation,
any other Common Stock Equivalents) subject to a limitation on conversion or exercise analogous to the limitation contained herein
beneficially owned by the Holder or any of its Affiliates or Attribution Parties.  Except as set forth in the preceding sentence,
for purposes of this Section 2(f), beneficial ownership shall be calculated in accordance with Section 13(d) of the Exchange Act
and the rules and regulations promulgated thereunder, it being acknowledged by the Holder that the Company is not representing
to the Holder that such calculation is in compliance with Section 13(d) of the Exchange Act and the Holder is solely responsible
for any schedules required to be filed in accordance therewith. The submission of a Notice of Exercise shall be deemed to be the
Holder’s determination of whether this Warrant is exercisable (in relation to other securities owned by the Holder together
with any Affiliates and Attribution Parties) and of which portion of this Warrant is exercisable, in each case subject to the
Beneficial Ownership Limitation, and the Company shall have no obligation to verify or confirm the accuracy of such determination.
In addition, a determination as to any group status as contemplated above shall be determined in accordance with Section 13(d)
of the Exchange Act and the rules and regulations promulgated thereunder. For purposes of this Section 2(f), in determining the
number of outstanding shares of Common Stock, a Holder may rely on the number of outstanding shares of Common Stock as reflected
in (A) the Company’s most recent periodic or annual report filed with the Commission, as the case may be, (B) a more recent
public announcement by the Company or (C) a more recent written notice by the Company or the Transfer Agent setting forth the
number of shares of Common Stock outstanding.  Upon the written or oral request of a Holder, the Company shall within one
Trading Day confirm orally and in writing to the Holder the number of shares of Common Stock then outstanding.  In any case,
the number of outstanding shares of Common Stock shall be determined after giving effect to the conversion or exercise of securities
of the Company, including this Warrant, by the Holder or its Affiliates or Attribution Parties since the date as of which such
number of outstanding shares of Common Stock was reported. The “Beneficial Ownership Limitation” shall be 4.99%
of the number of shares of the Common Stock outstanding immediately after giving effect to the issuance of shares of Common Stock
issuable upon exercise of this Warrant. The provisions of this paragraph shall be construed and implemented in a manner otherwise
than in strict conformity with the terms of this Section 2(f) to correct this paragraph (or any portion hereof) which may be defective
or inconsistent with the intended Beneficial Ownership Limitation herein contained or to make changes or supplements necessary
or desirable to properly give effect to such limitation. The limitations contained in this paragraph shall apply to a successor
holder of this Warrant.

 

Section 3.      Certain
Adjustments.

 

a)        Stock Dividends and Splits. If the Company, at any time while this Warrant is outstanding: (i) pays a stock dividend
or otherwise makes a distribution or distributions on shares of its Common Stock or any other equity or equity equivalent securities
payable in shares of Common Stock (which, for avoidance of doubt, shall not include any shares of Common Stock issued by the Company
upon exercise of this Warrant), (ii) subdivides outstanding shares of Common Stock into a larger number of shares, (iii) combines
(including by way of reverse stock split) outstanding shares of Common Stock into a smaller number of shares or (iv) issues by
reclassification of shares of the Common Stock any shares of capital stock of the Company, then in each case the Exercise Price
shall be multiplied by a fraction of which the numerator shall be the number of shares of Common Stock (excluding treasury shares,
if any) outstanding immediately before such event and of which the denominator shall be the number of shares of Common Stock outstanding
immediately after such event, and the number of shares issuable upon exercise of this Warrant shall be proportionately adjusted
such that the aggregate Exercise Price of this Warrant shall remain unchanged. Any adjustment made pursuant to this Section 3(a)
shall become effective immediately after the record date for the determination of stockholders entitled to receive such dividend
or distribution and shall become effective immediately after the effective date in the case of a subdivision, combination or re-classification.

 

b)        Subsequent
Rights Offerings. In addition to any adjustments pursuant to Section 3(a) above, if at any time the Company grants, issues
or sells any Common Stock Equivalents or rights to purchase stock, warrants, securities or other property pro rata to all (or
substantially all) of the record holders of any class of shares of Common Stock (the “Purchase Rights”), then
the Holder will be entitled to acquire, upon the terms applicable to such Purchase Rights, the aggregate Purchase Rights which
the Holder could have acquired if the Holder had held the number of shares of Common Stock acquirable upon complete exercise of
this Warrant (without regard to any limitations on exercise hereof, including without limitation, the Beneficial Ownership Limitation)
immediately before the date on which a record is taken for the grant, issuance or sale of such Purchase Rights, or, if no such
record is taken, the date as of which the record holders of shares of Common Stock are to be determined for the grant, issue or
sale of such Purchase Rights (provided, however, to the extent that the Holder’s right to participate in any such Purchase
Right would result in the Holder exceeding the Beneficial Ownership Limitation, then the Holder shall not be entitled to participate
in such Purchase Right to such extent (or beneficial ownership of such shares of Common Stock as a result of such Purchase Right
to such extent) and such Purchase Right to such extent shall be held in abeyance for the Holder until such time, if ever, as its
right thereto would not result in the Holder exceeding the Beneficial Ownership Limitation).

 

 

 

 

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c)        Pro
Rata Distributions. During such time as this Warrant is outstanding, if the Company shall declare or make any dividend or
other distribution of its assets (or rights to acquire its assets) to all (or substantially all) of holders of shares of Common
Stock, by way of return of capital or otherwise (including, without limitation, any distribution of cash, stock or other securities,
property or options by way of a dividend, spin off, reclassification, corporate rearrangement, scheme of arrangement or other
similar transaction) (a “Distribution”), at any time after the issuance of this Warrant, then, in each such
case, the Holder shall be entitled to participate in such Distribution to the same extent that the Holder would have participated
therein if the Holder had held the number of shares of Common Stock acquirable upon complete exercise of this Warrant (without
regard to any limitations on exercise hereof, including without limitation, the Beneficial Ownership Limitation) immediately before
the date of which a record is taken for such Distribution, or, if no such record is taken, the date as of which the record holders
of shares of Common Stock are to be determined for the participation in such Distribution (provided, however, to
the extent that the Holder's right to participate in any such Distribution would result in the Holder exceeding the Beneficial
Ownership Limitation, then the Holder shall not be entitled to participate in such Distribution to such extent (or in the beneficial
ownership of any shares of Common Stock as a result of such Distribution to such extent) and the portion of such Distribution
shall be held in abeyance for the benefit of the Holder until such time, if ever, as its right thereto would not result in the
Holder exceeding the Beneficial Ownership Limitation.

 

d)        Fundamental
Transaction. If, at any time while this Warrant is outstanding, (i) the Company, directly or indirectly, in one or more related
transactions effects any merger or consolidation of the Company with or into another Person, (ii) the Company, directly or indirectly,
effects any sale, lease, license, assignment, transfer, conveyance or other disposition of all or substantially all of its assets
in one or a series of related transactions, (iii) any, direct or indirect, purchase offer, tender offer or exchange offer (whether
by the Company or another Person) is completed pursuant to which holders of Common Stock are permitted to sell, tender or exchange
their shares for other securities, cash or property and has been accepted by the holders of 50% or more of the outstanding Common
Stock, (iv) the Company, directly or indirectly, in one or more related transactions effects any reclassification, reorganization
or recapitalization of the Common Stock or any compulsory share exchange pursuant to which the Common Stock is effectively converted
into or exchanged for other securities, cash or property, or (v) the Company, directly or indirectly, in one or more related transactions
consummates a stock or share purchase agreement or other business combination (including, without limitation, a reorganization,
recapitalization, spin-off or scheme of arrangement) with another Person or group of Persons whereby such other Person or group
acquires more than 50% of the outstanding shares of Common Stock (not including any shares of Common 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 or share
purchase agreement or other business combination) (each a “Fundamental Transaction”), then, upon any subsequent
exercise of this Warrant, the Holder shall have the right to receive, for each Warrant Share that would have been issuable upon
such exercise immediately prior to the occurrence of such Fundamental Transaction, at the option of the Holder (without regard
to any limitation in Section 2(f) hereof on the exercise of this Warrant), the number of shares of Common Stock of the successor
or acquiring corporation or of the Company, if it is the surviving corporation, and any additional consideration (the “Alternate
Consideration”) receivable as a result of such Fundamental Transaction by a holder of the number of shares of Common
Stock for which this Warrant is exercisable immediately prior to such Fundamental Transaction (without regard to any limitation
in Section 2(f) hereof on the exercise of this Warrant). For purposes of any such exercise, the determination of the Exercise
Price shall be appropriately adjusted to apply to such Alternate Consideration based on the amount of Alternate Consideration
issuable in respect of one share of Common Stock in such Fundamental Transaction, and the Company shall apportion the Exercise
Price among the Alternate Consideration in a reasonable manner reflecting the relative value of any different components of the
Alternate Consideration. If holders of Common Stock are given any choice as to the securities, cash or property to be received
in a Fundamental Transaction, then the Holder shall be given the same choice as to the Alternate Consideration it receives upon
any exercise of this Warrant following such Fundamental Transaction. Notwithstanding anything to the contrary, in the event of
a Fundamental Transaction, the Company or any Successor Entity (as defined below) shall, at the Holder’s option, exercisable
at any time concurrently with, or within 30 days after, the consummation of the Fundamental Transaction (or, if later, the date
of the public announcement of the applicable Fundamental Transaction), purchase 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 this Warrant on the date of
the consummation of such Fundamental Transaction; provided, however, that, if the Fundamental Transaction is not within the Company's
control, including not approved by the Company's Board of Directors, Holder shall only be entitled to receive from the Company
or any Successor Entity, as of the date of consummation of such Fundamental Transaction, the same type or form of consideration
(and in the same proportion), at the Black Scholes Value (as defined below) of the unexercised portion of this Warrant, that is
being offered and paid to the holders of Common Stock of the Company in connection with the Fundamental Transaction, whether that
consideration be in the form of cash, stock or any combination thereof, or whether the holders of Common Stock are given the choice
to receive from among alternative forms of consideration in connection with the Fundamental Transaction.

 

 

 

 

 

    	 	7	 

     

    

 

“Black Scholes
Value” means the value of this Warrant based on the Black-Scholes Option Pricing Model obtained from the “OV”
function on Bloomberg, L.P. (“Bloomberg”) determined as of the day of consummation of the applicable Fundamental
Transaction for pricing purposes and reflecting (A) a risk-free interest rate corresponding to the U.S. Treasury rate for a period
equal to the time between the date of the public announcement of the applicable Fundamental Transaction and the Termination Date,
(B) an expected volatility equal to the greater of 100% and the 100 day volatility obtained from the HVT function on Bloomberg
as of the Trading Day immediately following the public announcement of the applicable Fundamental Transaction, (C) the underlying
price per share used in such calculation shall be the greater of (i) 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 such Fundamental Transaction and (ii) the greater
of (x) the last VWAP immediately prior to the public announcement of such Fundamental Transaction and (y) the last VWAP immediately
prior to the consummation of such Fundamental Transaction and (D) a remaining option time equal to the time between the date of
the public announcement of the applicable Fundamental Transaction and the Termination Date. The payment of the Black Scholes Value
will be made by wire transfer of immediately available funds within five Business Days of the Holder’s election (or, if
later, on the effective date of the Fundamental Transaction). The Company shall cause any successor entity in a Fundamental Transaction
in which the Company is not the survivor (the “Successor Entity”) to assume in writing all of the obligations
of the Company under this Warrant in accordance with the provisions of this Section 3(d) pursuant to written agreements prior
to such Fundamental Transaction and shall, at the option of the Holder, 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 which is
exercisable for a corresponding number of shares of capital stock of such Successor Entity (or its parent 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 which applies the exercise price hereunder
to such shares of capital stock (but taking into account the relative value of the shares of Common Stock pursuant to such Fundamental
Transaction and the value of such shares of capital stock, such 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 occurrence of any such Fundamental Transaction, the Successor Entity shall succeed to, and be substituted for (so that
from and after the date of such 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.

 

e)        Calculations.
All calculations under this Section 3 shall be made to the nearest cent or the nearest 1/100th of a share, as the case may be.
For purposes of this Section 3, the number of shares of Common Stock deemed to be issued and outstanding as of a given date shall
be the sum of the number of shares of Common Stock (excluding treasury shares, if any) issued and outstanding.

 

f)         Notice.

i.           
Adjustment to Exercise Price. Whenever the Exercise Price is adjusted pursuant to any provision of this Section
3, the Company shall promptly deliver to (a) the Holder by facsimile or e-mail a notice setting forth the Exercise Price after
such adjustment and any resulting adjustment to the number of Warrant Shares and setting forth a brief statement of the facts
requiring such adjustment and (b) the Warrant Agent and Transfer Agent the notice specified under Section 12 of the Warrant Agency
Agreement.

 

ii.           Notice
to Allow Exercise by Holder. If (A) the Company shall declare a dividend (or any other distribution in whatever form) on the
Common Stock, (B) the Company shall declare a special nonrecurring cash dividend on or a redemption of the Common Stock, (C) the
Company shall authorize the granting to all holders of the Common Stock rights or warrants to subscribe for or purchase any shares
of capital stock of any class or of any rights, (D) the approval of any stockholders of the Company shall be required in connection
with any reclassification of the Common Stock, any consolidation or merger to which the Company is a party, any sale or transfer
of all or substantially all of the assets of the Company, or any compulsory share exchange whereby the Common Stock is converted
into other securities, cash or property, or (E) the Company shall authorize the voluntary or involuntary dissolution, liquidation
or winding up of the affairs of the Company, then, in each case, the Company shall cause to be delivered by facsimile or e-mail
to the Holder at its last facsimile number or email address as it shall appear upon the Warrant Register of the Company, at least
10 calendar days prior to the applicable record or effective date hereinafter specified, a notice stating (x) the date on which
a record is to be taken for the purpose of such dividend, distribution, redemption, rights or warrants, or if a record is not
to be taken, the date as of which the holders of the Common Stock of record to be entitled to such dividend, distributions, redemption,
rights or warrants are to be determined or (y) the date on which such reclassification, consolidation, merger, sale, transfer
or share exchange is expected to become effective or close, and the date as of which it is expected that holders of the Common
Stock of record shall be entitled to exchange their shares of the Common Stock for securities, cash or other property deliverable
upon such reclassification, consolidation, merger, sale, transfer or share exchange; provided that the failure to deliver such
notice or any defect therein or in the delivery thereof shall not affect the validity of the corporate action required to be specified
in such notice. The Company shall also simultaneously deliver a copy of any such notice to the Warrant Agent. To the extent that
any notice provided in this Warrant constitutes, or contains, material, non-public information regarding the Company or any of
the Subsidiaries, the Company shall simultaneously file such notice with the Commission pursuant to a Current Report on Form 8-K.
The Holder shall remain entitled to exercise this Warrant during the period commencing on the date of such notice to the effective
date of the event triggering such notice except as may otherwise be expressly set forth herein.

 

 

    	 	8	 

     

    

 

Section 4.      Transfer
of Warrant.

 

a)        Transferability.
This Warrant and all rights hereunder are transferable, in whole or in part, upon surrender of this Warrant at the office of
the Warrant Agent designated for such purpose, together with the required form of assignment of this Warrant substantially in
the form attached hereto duly executed and properly completed by the Holder or its agent or attorney and funds sufficient to
pay any transfer taxes payable upon the making of such transfer, provided that, in connection with a Warrant held in global
form through DTC (or any successor depositary), no ink-original assignment form or any medallion guarantee (or other type of
guarantee or notarization) of an assignment form shall be required. Upon such surrender and, if required, such payment, the
Company shall execute and deliver, a new Warrant or Warrants in the name of the assignee or assignees, as applicable, and in
the denomination or denominations specified in such instrument of assignment, and shall issue to the assignor a new Warrant
evidencing the portion of this Warrant not so assigned, and the Warrant Agent, if instructed by the Company, shall
countersign and deliver such new Warrant and this Warrant shall promptly be cancelled. The Warrant, if properly assigned in
accordance herewith, may be exercised by a new holder for the purchase of Warrant Shares without having a new Warrant issued.
Notwithstanding anything herein to the contrary, provided the Warrant is in book entry or electronic form through
DTC (or any successor depositary), the Holder shall not be required to physically surrender this Warrant to the Company
unless the Holder has assigned this Warrant in full, in which case, the Holder shall surrender this Warrant to the Company
within three (3) Trading Days of the date on which the Holder delivers an assignment form to the Company assigning this
Warrant in full.

 

b)       New Warrants. If this Warrant is not held in global form through DTC (or any successor depositary), this Warrant
may be divided or combined with other Warrants upon presentation hereof at the aforesaid office of the Warrant Agent, together
with a written notice specifying the names and denominations in which new Warrants are to be issued, signed by the Holder or its
agent or attorney. Subject to compliance with Section 4(a), as to any transfer which may be involved in such division or combination,
the Company shall execute and deliver, and the Warrant Agent, if instructed by the Company, shall countersign,
a new Warrant or Warrants in exchange for the Warrant or Warrants to be divided or combined in accordance with such notice. All
Warrants issued on transfers or exchanges shall be dated the original Initial Exercise Date and shall be identical with this Warrant
except as to the number of Warrant Shares issuable pursuant thereto.

 

c)      
Warrant Register. The Warrant Agent shall register this Warrant, upon records to be maintained by the Warrant Agent
for that purpose (the “Warrant Register”), in the name of the record Holder hereof from time to time. The Company
and the Warrant Agent may deem and treat the registered Holder of this Warrant as the absolute owner hereof for the purpose of
any exercise hereof or any distribution to the Holder, and for all other purposes, absent actual notice to the contrary.

 

Section 5.     Miscellaneous.

 

a)        No
Rights as Stockholder Until Exercise. This Warrant does not entitle the Holder to any voting rights, dividends or other rights
as a stockholder of the Company prior to the exercise hereof as set forth in Section 2(e)(i), except as expressly set forth in
Section 3.

 

b)        Loss, Theft, Destruction or Mutilation of Warrant. Upon receipt by the Warrant Agent of evidence reasonably satisfactory
to it of the loss, theft, destruction or mutilation of a Warrant Certificate, which evidence shall include an affidavit of loss,
or in the case of mutilated certificates, the certificate or portion thereof remaining, and, in case of loss, theft or destruction,
of indemnity or security acceptable to the Company and the Warrant Agent and satisfaction of any other reasonable requirements
established by Section 8-405 of the Uniform Commercial Code as in effect in the State of Delaware, and reimbursement to the Company
and the Warrant Agent of all reasonable expenses incidental thereto, and upon surrender to the Warrant Agent and cancellation of
the Warrant Certificate if mutilated, the Company will make and deliver a new Warrant Certificate of like tenor to the Warrant
Agent for delivery to the Holder in lieu of the Warrant Certificate so lost, stolen, destroyed or mutilated. Notwithstanding anything
herein to the contrary, in connection with a Warrant held in global form through DTC (or any successor depositary), no posting
of a bond shall be required under this Section 5(b).

 

c)        Saturdays, Sundays, Holidays, etc. If the last or appointed day for the taking of any action or the expiration of
any right required or granted herein shall not be a Business Day, then, such action may be taken or such right may be exercised
on the next succeeding Business Day.

 

 

 

    	 	9	 

     

    

 

d)        Authorized
Shares.

 

The Company covenants
that, during the period the Warrant is outstanding, it will reserve from its authorized and unissued Common Stock a sufficient
number of shares to provide for the issuance of the Warrant Shares upon the exercise of any purchase rights under this Warrant.
The Company further covenants that its issuance of this Warrant shall constitute full authority to its officers who are charged
with the duty of issuing the necessary Warrant Shares upon the exercise of the purchase rights under this Warrant. The Company
will take all such reasonable action as may be necessary to assure that such Warrant Shares may be issued as provided herein without
violation of any applicable law or regulation, or of any requirements of the Trading Market upon which the Common Stock may be
listed. The Company covenants that all Warrant Shares which may be issued upon the exercise of the purchase rights represented
by this Warrant will, upon exercise of the purchase rights represented by this Warrant and payment for such Warrant Shares in accordance
herewith, be duly authorized, validly issued, fully paid and nonassessable and free from all taxes, liens and charges created by
the Company in respect of the issue thereof (other than taxes in respect of any transfer occurring contemporaneously with such
issue).

 

Except and
to the extent as waived or consented to by the Holder, the Company shall not by any action, including, without limitation, amending
its certificate of incorporation or through any 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 of this
Warrant, but will at all times in good faith assist in the carrying out of all such terms and in the taking of all such actions
as may be necessary or appropriate to protect the rights of Holder as set forth in this Warrant against impairment. Without limiting
the generality of the foregoing, the Company will (i) not increase the par value of any Warrant Shares above the amount payable
therefor upon such exercise immediately prior to such increase in par value, (ii) take all such action as may be necessary or appropriate
in order that the Company may validly and legally issue fully paid and nonassessable Warrant Shares upon the exercise of this Warrant
and (iii) use commercially reasonable efforts to obtain all such authorizations, exemptions or consents from any public regulatory
body having jurisdiction thereof, as may be, necessary to enable the Company to perform its obligations under this Warrant.

 

Before taking
any action which would result in an adjustment in the number of Warrant Shares for which this Warrant is exercisable or in the
Exercise Price, the Company shall obtain all such authorizations or exemptions thereof, or consents thereto, as may be necessary
from any public regulatory body or bodies having jurisdiction thereof.

 

e)        Governing
Law. All questions concerning the construction, validity, enforcement and interpretation of this Warrant shall be governed
by and construed and enforced in accordance with the internal laws of the State of New York, without regard to the principles
of conflict of laws thereof. Each party agrees that all legal proceedings concerning the interpretation, enforcement and defense
of this Warrant shall be commenced in the state and federal courts sitting in the City of New York, Borough of Manhattan (the
“New York Courts”). Each party hereto hereby irrevocably submits to the exclusive jurisdiction of the New York
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 suit, action or proceeding, any claim that it
is not personally subject to the jurisdiction of such New York Courts, or such New York Courts are improper or inconvenient venue
for such proceeding. Each party hereby irrevocably waives personal service of process and consents to process being served in
any such suit, action or proceeding by mailing a copy thereof 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 Warrant 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 other manner permitted by law. If any party shall commence an action or proceeding to enforce any provisions
of this Warrant, then the prevailing party in such action or proceeding shall be reimbursed by the other party for its attorneys’
fees and other costs and expenses incurred in the investigation, preparation and prosecution of such action or proceeding.

 

f)         Restrictions. The Holder acknowledges that the Warrant Shares acquired upon the exercise of this Warrant, if not
registered and the Holder does not utilize cashless exercise, will have restrictions upon resale imposed by state and federal securities
laws.

 

g)        Nonwaiver
and Expenses. No course of dealing or any delay or failure to exercise any right hereunder on the part of Holder shall operate
as a waiver of such right or otherwise prejudice the Holder’s rights, powers or remedies. If the Company willfully and knowingly
fails to comply with any provision of this Warrant, which results in any material damages to the Holder, the Company shall pay
to the Holder such amounts as shall be sufficient to cover any costs and expenses including, but not limited to, reasonable attorneys’
fees, including those of appellate proceedings, incurred by the Holder in collecting any amounts due pursuant hereto or in otherwise
enforcing any of its rights, powers or remedies hereunder.

 

 

 

 

    	 	10	 

     

    

 

h)        Notices.
Any and all notices or other communications or deliveries to be provided by the Holders hereunder including, without limitation,
any Notice of Exercise, shall be in writing and delivered personally, by facsimile, by e-mail or sent by a nationally recognized
overnight courier service, addressed to the Company, at 1129 N. McDowell Blvd., Petaluma, CA 94954, Attention: Chief Executive
Officer, facsimile number [______], E-mail: [______], or such other facsimile number, email address or address as the Company
may specify for such purposes by notice to the Holders. Any and all notices or other communications or deliveries to be provided
by the Company hereunder shall be in writing and delivered personally, by facsimile, by email or sent by a nationally recognized
overnight courier service addressed to each Holder at the facsimile number or address of such Holder appearing on the books of
the Warrant Agent. Any notice or other communication or deliveries hereunder shall be deemed given and effective on the earliest
of (i) the date of transmission, if such notice or communication is delivered via facsimile at the facsimile number or e-mail
at the e-mail address set forth in this Section prior to 5:30 p.m. (New York City time) on any date, (ii) the next Trading Day
after the date of transmission, if such notice or communication is delivered via facsimile at the facsimile number or e-mail at
the e-mail address set forth in this Section on a day that is not a Trading Day or later than 5:30 p.m. (New York City time) on
any Trading Day, (iii) the second Trading Day following the date of mailing, if sent by U.S. nationally recognized overnight courier
service, or (iv) upon actual receipt by the party to whom such notice is required to be given. To the extent that any notice provided
hereunder constitutes, or contains, material, non-public information regarding the Company or any subsidiaries, the Company shall
simultaneously file such notice with the Commission pursuant to a Current Report on Form 8-K. Notwithstanding any other provision
of this Warrant, where this Warrant provides for notice of any event to the Holder, if this Warrant is held in global form by
DTC (or any successor depositary), such notice shall be sufficiently given if given to DTC (or any successor depositary) pursuant
to the procedures of DTC (or such successor depositary), subject to a Holder’s right to elect to receive a Warrant in certificated
form pursuant to the terms of the Warrant Agency Agreement, in which case this sentence shall not apply.

 

i)         Warrant
Agency Agreement. The terms of this Warrant are to be read in conjunction with the applicable terms of the Warrant Agency
Agreement. If there is a conflict between the express terms of this Warrant and the Warrant Agency Agreement, the terms of this
Warrant shall govern and be controlling; provided, however, that all provisions with respect to the rights, duties, protections
and liability of the Warrant Agent only shall be determined and interpreted solely by the provisions of the Warrant Agency Agreement
and no provision of the Warrant Agency Agreement shall affect or limit the obligations of the Company under this Warrant.

 

j)         Limitation
of Liability. No provision hereof, in the absence of any affirmative action by the Holder to exercise this Warrant to purchase
Warrant Shares, and no enumeration herein of the rights or privileges of the Holder, shall give rise to any liability of the Holder
for the purchase price of any Common Stock or as a stockholder of the Company, whether such liability is asserted by the Company
or by creditors of the Company.

 

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

 

l)         Successors
and Assigns. Subject to applicable securities laws, this Warrant and the rights and obligations evidenced hereby shall inure
to the benefit of and be binding upon the successors and permitted assigns of the Company and the successors and permitted assigns
of Holder. The provisions of this Warrant are intended to be for the benefit of any Holder from time to time of this Warrant and
shall be enforceable by the Holder or holder of Warrant Shares.

 

m)       Amendment.
This Warrant may be modified or amended or the provisions hereof waived with the written consent of the Company, on the one hand,
and the Holder or the beneficial owner of this Warrant, on the other hand.

 

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

 

o)        Headings.
The headings used in this Warrant are for the convenience of reference only and shall not, for any purpose, be deemed a part of
this Warrant.

********************

 

(Signature Page Follows)

 

 

 

    	 	11	 

     

    

 

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

 

	 	SONOMA PHARMACEUTICALS, INC.
	 	 
	 	 
	 	By: ____________________________
	 	Name:
	 	Title:
	 	 

 

 

 

COMPUTERSHARE INC.

 

 

By:__________________________________________

Name:

Title:

 

 

 

COMPUTERSHARE TRUST COMPANY, N.A.

 

 

By:__________________________________________

Name:

Title:

 

 

 

 

 

 

 

    	 	12	 

     

    

 

NOTICE OF EXERCISE

 

To:SONOMA
PHARMACEUTICALS, INC.

 

(1)  
The undersigned hereby elects to purchase ________ Warrant Shares of the Company pursuant
to the terms of the attached Warrant (only if exercised in full), and tenders herewith payment of the exercise price in full, together
with all applicable transfer taxes, if any.

 

(2)  
Payment shall take the form of (check applicable box):

 

[  ] in lawful
money of the United States; or

 

[  ] if permitted
the cancellation of such number of Warrant Shares as is necessary, in accordance with the formula set forth in subsection 2(c),
to exercise this Warrant with respect to the maximum number of Warrant Shares purchasable pursuant to the cashless exercise procedure
set forth in subsection 2(c).

 

(3)  
Please issue said Warrant Shares in the name of the undersigned or in such other name as is
specified below:

_______________________________

 

The Warrant Shares shall be delivered to
the following DWAC Account Number:

 

_______________________________

 

_______________________________

 

_______________________________

 

[SIGNATURE
OF HOLDER]

 

Name of Investing Entity: _______________________________________________________________________

Signature of Authorized Signatory of
Investing Entity: _________________________________________________

Name of Authorized Signatory: ___________________________________________________________________

Title of Authorized Signatory: ____________________________________________________________________

Date: _______________________________________________________________________________________

 

 

 

 

    	 	13	 

     

    

 

EXHIBIT B

 

ASSIGNMENT
FORM

 

(To assign the
foregoing Warrant, execute this form and supply required information. Do not use this form to purchase shares.)

 

FOR VALUE RECEIVED,
the foregoing Warrant and all rights evidenced thereby are hereby assigned to

 

	Name:	________________________________
	 	(Please Print)
	 	 
	Address:	________________________________
	 	(Please Print)
	 	 
	Phone Number:	 
	 	 
	Email Address:	 
	 	 
	Holder’s Signature: _________________________	 
	 	 
	Holder’s Address: __________________________	 

 

 

 

 

 

 

 

    	 	14

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