Document:

EX-10.1

 EXHIBIT 10.1 

RETIREMENT AND SEPARATION AGREEMENT 

THIS RETIREMENT AND SEPARATION AGREEMENT (this “Agreement”) is dated December 18, 2014 (the “Effective
Date”), by and between Forum Energy Technologies, Inc., a Delaware corporation (the “Company”), and Wendell R. Brooks (“Executive”). 

RECITALS 
 WHEREAS, the
Company and Executive are party to that certain Employment Agreement dated as of August 2, 2010 (the “Employment Agreement”); and 

WHEREAS, Executive has expressed his desire to resign from officer positions and separate from employment with the Company and its affiliates
and subsidiaries under certain terms herein set forth; and 
 WHEREAS, in consideration of the mutual promises contained herein, Executive
voluntarily enters into this Agreement upon the terms and conditions herein set forth; and 
 WHEREAS, in consideration of the mutual
promises contained herein, the Company is willing to enter into this Agreement upon the terms and conditions herein set forth. 

AGREEMENT 
 NOW,
THEREFORE, intending to be legally bound and in consideration of the mutual covenants and agreements hereinafter set forth, the Company and Executive agree to the following terms and conditions: 

1. Resignation from Officer and Director Positions. Effective as of December 31, 2014 (the “Retirement Date”),
Executive hereby resigns as Executive Vice President, President—Production & Infrastructure of the Company and any and all director and other officer (or equivalent) positions he holds with the Company and its subsidiaries and
affiliates. Executive agrees to take any and all further acts necessary to accomplish these resignations. 
 2. Termination of
Benefits. 
 (a) Benefits. Executive shall be entitled to any benefits accrued through the Retirement Date under any of the
Company’s employee benefit plans, programs or arrangements which amount shall be payable in accordance with the terms and conditions of such employee benefits plans, programs or arrangements; provided, however, that the terms of
Section 3 hereof shall apply for purposes of the Options, RSU Award, Restricted Stock Award and Performance RSU Award (as defined below). 

 (b) 2014 Management Incentive Plan (“2014 MIP”). Subject to approval and
recommendation by the Nominating, Governance & Compensation Committee following analysis of the Company’s financial results for the 2014 year, Executive shall be entitled to receive the recommended payout under the 2014 MIP, which
shall be paid out at such time as MIP payouts are paid to other senior executives, but in no event later than March 15, 2015. 
 (c)
Deferred Compensation. The Company acknowledges that Executive is a participant in the Forum Energy Technologies, Inc. Deferred Compensation and Restoration Plan (the “Deferred Compensation Plan”), and that he shall receive
any benefits due under the Deferred Compensation Plan in accordance with the terms and conditions of the Deferred Compensation Plan and the Deferral Agreement under the Deferred Compensation Plan in effect on the Effective Date (the
“Deferral Agreement”). Executive shall not be eligible to continue participation in the Deferred Compensation Plan. The parties anticipate that the Deferred Compensation Plan payments shall be made in accordance with the Deferred
Compensation Plan and the provisions of Section 6(m) hereof. 
 (d) No Other Benefits. Except as specified in this Agreement,
Executive shall not be entitled to any severance payments and, subsequent to the Retirement Date, Executive shall not be eligible to receive any awards under any long-term incentive plan or management incentive plan of the Company or any other
benefits under any other plan or arrangement of the Company. 
 3. Treatment of Equity Awards. Subject to Executive’s continued
compliance with the terms and provisions hereof, Executive shall be entitled to the following benefits. 
 (a) Nonstatutory Stock
Options. Executive is the recipient of Nonstatutory Stock Option Agreements with respect to the Company’s common stock dated April 12, 2012 and February 21, 2013 (the “Options”). Notwithstanding any terms of the
Options to the contrary, the Options will vest and become exercisable in full on the date immediately following the Retirement Date, and the Options shall remain exercisable until December 31, 2017, after which they expire. 

(b) Restricted Stock Units. Executive is the recipient of a Restricted Stock Unit Agreement with respect to the Company’s common
stock dated February 21, 2013 (the “RSU Award”). Notwithstanding any terms of the RSU Award to the contrary, the Restricted Stock Units shall become 100% fully vested as of the Retirement Date. All vested Restricted Stock Units
shall be issued to Executive on the date six months after Executive has a “separation from service” as described in Section 6(m) below. 

(c) Restricted Stock. Executive is the recipient of a Restricted Stock Agreement with respect to the Company’s common stock dated
April 12, 2012 (the “Restricted Stock Award”). Notwithstanding any terms of the Restricted Stock Award to the contrary, the Restricted Stock shall become 100% fully vested as of the date immediately following the Retirement
Date. 

 (d) Performance Restricted Stock Units. Executive is the recipient of a Performance RSU
Agreement with respect to the Company’s common stock dated February 21, 2013 (the “Performance RSU Award”). The shares of common stock of the Company with respect to the Earned Performance Shares (as defined in the
Performance RSU Award) with respect to the First Performance Period (as defined in the Performance RSU Award) vested and were issued to Executive in accordance with the terms of the Performance RSU Award. Notwithstanding any terms of the Performance
RSU Award to the contrary, the unvested Performance-Based Units granted to Executive shall vest as follows: 
 (i) the Performance Shares
with respect to the Second Performance Period shall be fully vested on the date immediately following the Retirement Date and all shares of common stock with respect to the vested Earned Performance Shares for the Second Performance Period shall be
issued to Executive on March 13, 2015; 
 (ii) the Performance Shares with respect to the Third Performance Period shall be two-thirds (2/3) vested as of the date immediately following the Retirement Date and all shares of common stock with respect to the vested Earned Performance Shares for the Third Performance Period shall be
issued to Executive on March 15, 2016; and 
 (iii) the remaining 1/3 of the Performance Shares with respect to the Third Performance
Period shall be forfeited and of no further force or effect. 
 If any calculation with respect to the Performance Shares would result in a fractional
share, the number of shares of common stock to be issued shall be rounded up to the nearest whole share. 
 4. Post-Employment
Release. Executive acknowledges that this Agreement provides Executive with additional rights and privileges to which Executive would not otherwise be entitled, and, in exchange for the same, the Company requires the binding execution by
Executive (without revocation) of the Waiver and Release attached hereto as Exhibit A (the “Waiver and Release”), which must be executed and returned during the period beginning on the Retirement Date and ending on the
fiftieth (50th) day after the Retirement Date, which Executive hereby agrees provides him with at least 21 calendar days to consider whether to sign and return the Waiver and Release to the Company. Notwithstanding any provision herein to the
contrary, if Executive has not delivered to the Company an executed and irrevocable Waiver and Release on or before the fiftieth (50th) day after the Retirement Date, the Company shall have no further obligations to Executive pursuant to this
Agreement. 
 5. Restrictive Covenants. Executive reaffirms and agrees to the restrictive covenants contained in this Section 5
and acknowledges and agrees that this Agreement provides Executive with additional rights and privileges to which Executive would not otherwise be entitled in consideration for Executive’s compliance with such restrictive covenants. 

(a) Nondisclosure. Executive reaffirms the agreement originally set forth in the Employment Agreement regarding nondisclosure of
confidential information or work product and return of property of the Company, in accordance with the terms of Article V of the Employment Agreement. 

 (b) Statements Concerning the Company. Executive reaffirms the agreement originally set
forth in the Employment Agreement regarding non-disparagement of the Company and its agents and affiliates in accordance with the terms of Article VI of the Employment Agreement. 

(c) Non-Competition. Executive reaffirms the agreement originally set forth in the Employment Agreement regarding the non-competition
provisions of Article VIII of the Employment Agreement. 
 (d) Non-Solicitation. Executive reaffirms the agreement originally set
forth in the Employment Agreement regarding the non-solicitation provisions of Article VIII of the Employment Agreement. 
 6.
Miscellaneous. 
 (a) Dispute Resolution. Executive and the Company hereby reaffirm the agreement originally set forth in the
Employment Agreement regarding resolution of claims and disputes, in accordance with the terms of Article IX of the Employment Agreement (the “Arbitration Provision”) whether arising pursuant to the terms of this Agreement or
otherwise. THE PARTIES ACKNOWLEDGE THAT, BY SIGNING THIS AGREEMENT, THEY ARE KNOWINGLY AND VOLUNTARILY WAIVING ANY RIGHTS THAT THEY MAY HAVE TO A JURY TRIAL OR, EXCEPT AS EXPRESSLY PROVIDED IN THE ARBITRATION PROVISION, A COURT TRIAL OF ANY CLAIM
THAT IS SUBJECT TO THE ARBITRATION PROVISION. 
 (b) Applicable Law. This Agreement is entered into under, and shall be governed
for all purposes by, the laws of the State of Texas, without regard to conflicts of laws principles thereof. 
 (c) Submission to
Jurisdiction. Subject to the provisions of Section 6(a), with respect to any claim or dispute related to or arising under this Agreement that is not subject to the Arbitration Provision, the parties hereto hereby consent to the exclusive
jurisdiction, forum and venue of the state and federal courts located in Harris County, Texas. 
 (d) Entire Agreement. Except as
specifically set forth herein, this Agreement contains the entire agreement and understanding between the parties hereto and supersedes the Employment Agreement and any other prior or contemporaneous written or oral agreements, representations and
warranties between them respecting the subject matter hereof. 
 (e) Amendment. This Agreement may be amended only by a writing
signed by Executive and by a duly authorized representative of the Company. 
 (f) Tax Withholding. The Company may withhold from any
amounts or benefits payable under this Agreement all federal, state, city or other taxes that will be required pursuant to any law or governmental regulation or ruling. 

 (g) Assignability. The Company shall have the right to assign this Agreement and its
rights hereunder, in whole or in part. Executive shall not have any right to pledge, hypothecate, anticipate, or in any way create a lien upon any amounts provided under this Agreement, and no payments or benefits due hereunder shall be assignable
in anticipation of payment either by voluntary or involuntary acts or by operation of law. 
 (h) Severability. If any term,
provision, covenant or condition of this Agreement, or the application thereof to any person, place or circumstance, shall be held to be invalid, unenforceable or void, the remainder of this Agreement and such term, provision, covenant or condition
as applied to other persons, places and circumstances shall remain in full force and effect. 
 (i) Construction. The headings and
captions of this Agreement are provided for convenience only and are intended to have no effect in construing or interpreting this Agreement. The language in all parts of this Agreement shall be in all cases construed according to its fair meaning
and not strictly for or against the Company or Executive. 
 (j) Counterparts. This Agreement may be executed in two or more
counterparts, each of which will be deemed an original, and all of which together will constitute one document. 
 (k) Nonwaiver. No
failure or neglect of either party hereto in any instance to exercise any right, power or privilege hereunder or under law shall constitute a waiver of any other right, power or privilege or of the same right, power or privilege in any other
instance. All waivers by either party hereto must be contained in a written instrument signed by the party to be charged and, in the case of the Company, by an officer of the Company (other than Executive) or other person duly authorized by the
Company. 
 (l) Notices. Any notice, request, consent or approval required or permitted to be given under this Agreement or pursuant
to law shall be sufficient if in writing, and if and when sent by certified or registered mail, with postage prepaid, to Executive’s residence (as noted in the Company’s records), or to the Company’s principal office, as the case may
be. 
 (m) Section 409A. 

(i) Interpretation. This Agreement is intended to comply with the provisions of Section 409A and, wherever possible, shall be
construed and interpreted to ensure that any payments that may be paid, distributed, provided, reimbursed, deferred or settled under this Agreement shall not be subject to any additional taxation or premium interest under Section 409A. In the
event the parties determine that this Agreement or any payment hereunder does not comply with the applicable provisions of Section 409A, the Company and Executive agree to cooperate to the fullest extent in pursuit of any available corrective
relief, as provided under the terms of Internal Revenue Service Notice 2008-113 or any corresponding subsequent guidance, from the Section 409A additional income tax and premium interest. Notwithstanding
the foregoing, Executive acknowledges and agrees that any and all tax liabilities of Executive 

 
arising from the transactions contemplated by this Agreement are his sole responsibility, including, without limitation, any additional taxes and interest due pursuant to Section 409A. No
acceleration of payments and benefits provided herein shall be allowed, unless permitted by Section 409A. 
 (ii) Separation from
Service. Executive shall be considered to have terminated from employment when Executive incurs a “Separation from Service” under Section 409A. It is contemplated hereunder that the Retirement Date shall be Executive’s
date of Separation from Service for purposes of any deferred compensation that is payable upon a Separation from Service within the meaning of Section 409A. 

IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement as of the date set forth below. 

 

					
	FORUM ENERGY TECHNOLOGIES, INC.	  	
			
	By:	  	/s/ C. Christopher Gaut	  	Date: December 18, 2014
		  	Name: C. Christopher Gaut	  	
		  	Title: Chief Executive Officer	  	
		
	EXECUTIVE	  	
		
	/s/ Wendell R. Brooks	  	Date: December 18, 2014
	Wendell R. Brooks	  	

 EXHIBIT A 

RELEASE 
 This Release
(this “Release”) constitutes the release referred to in that certain Agreement (the “Agreement”) dated as of December 18, 2014, by and between Wendell R. Brooks
(“Executive”) and Forum Energy Technologies, Inc., a Delaware corporation (the “Company”). 

1. General Release. 

(a) For good and valuable consideration, including additional rights and privileges to which Executive would not otherwise be entitled,
Executive hereby releases, discharges and forever acquits the Company, its affiliates and subsidiaries, the past, present and future stockholders, members, partners, directors, managers, employees, agents, attorneys, heirs, legal representatives,
successors and assigns of the foregoing, as well as all employee benefit plans maintained by the Company or any of its affiliates or subsidiaries and all fiduciaries and administrators of any such plan, in their personal and representative
capacities (collectively, the “Company Parties”), from liability for, and hereby waives, any and all claims, rights, damages, or causes of action of any kind related to Executive’s employment with any Company Party, the
termination of such employment, and any other acts or omissions related to any matter on or prior to the date of this Agreement (collectively, the “Released Claims”). 

(b) The Released Claims include without limitation those arising under or related to: (i) the Age Discrimination in Employment Act of
1967; (ii) Title VII of the Civil Rights Act of 1964; (iii) the Civil Rights Act of 1991; (iv) sections 1981 through 1988 of Title 42 of the United States Code; (v) the Employee Retirement Income Security Act of 1974, including,
but not limited to, sections 502(a)(1)(A), 502(a)(1)(B), 502(a)(2), and 502(a)(3) to the extent the release of such claims is not prohibited by applicable law; (vi) the Immigration Reform Control Act; (vii) the Americans with Disabilities
Act of 1990; (viii) the National Labor Relations Act; (ix) the Occupational Safety and Health Act; (x) the Family and Medical Leave Act of 1993; (xi) any state or federal anti-discrimination law; (xii) any state or federal
wage and hour law; (xiii) any other local, state or federal law, regulation or ordinance; (xiv) any public policy, contract, tort, or common law; (xv) costs, fees, or other expenses including attorneys’ fees incurred in these
matters; (xvi) any employment contract, incentive compensation plan or stock option plan with any Company Party or to any ownership interest in any Company Party except as expressly provided in the Agreement and any stock option or other equity
compensation agreement between Executive and the Company; and (xvii) compensation or benefits of any kind not expressly set forth in the Agreement or any such stock option or other equity compensation agreement. 

(c) In no event shall the Released Claims include (i) any claim which arises after the date of this Release, (ii) any rights of
defense or indemnification which would be otherwise afforded to Executive under the Certificate of Incorporation, By-Laws or similar governing documents of the Company or its subsidiaries, or any indemnity agreement entered into with Executive,
(iii) any rights of defense or indemnification which would be otherwise afforded to Executive under any director or officer liability or other insurance policy maintained by the Company or its subsidiaries, (iv) any rights of Executive to
benefits accrued under any plan or arrangement referenced in Section 2(a) of the Agreement, or (v) any rights under the Agreement. 

 (d) Notwithstanding this release of liability, nothing in this Release prevents Executive from
filing any non-legally waivable claim (including a challenge to the validity of this Agreement) with the Equal Employment Opportunity Commission (“EEOC”) or comparable state or local agency or participating in any
investigation or proceeding conducted by the EEOC or comparable state or local agency; however, Executive understands and agrees that Executive is waiving any and all rights to recover any monetary or personal relief or recovery as a result of such
EEOC, or comparable state or local agency proceeding or subsequent legal actions. 
 (e) This Release is not intended to indicate that any
such claims exist or that, if they do exist, they are meritorious. Rather, Executive is simply agreeing that, in exchange for the consideration recited in the first sentence of Section 1(a) of this Release, any and all potential claims of this
nature that Executive may have against the Company Parties, regardless of whether they actually exist, are expressly settled, compromised and waived. 

(f) By signing this Release, Executive is bound by it. Anyone who succeeds to Executive’s rights and responsibilities, such as heirs or
the executor of Executive’s estate, is also bound by this Release. This Release also applies to any claims brought by any person or agency or class action under which Executive may have a right or benefit. THIS RELEASE INCLUDES MATTERS
ATTRIBUTABLE TO THE SOLE OR PARTIAL NEGLIGENCE (WHETHER GROSS OR SIMPLE) OR OTHER FAULT, INCLUDING STRICT LIABILITY, OF ANY OF THE COMPANY PARTIES.  

2. Covenant Not to Sue; Executive’s Representation. Executive agrees not to bring or join any lawsuit against any of the
Company Parties in any court relating to any of the Released Claims, except to enforce any terms of the Agreement. Executive represents that Executive has not brought or joined any claim, lawsuit or arbitration against any of the Company Parties in
any court or before any administrative agency or arbitral authority and has made no assignment of any rights Executive has asserted or may have against any of the Company Parties to any person or entity, in each case, with respect to any Released
Claims. Executive expressly represents that, as of the date Executive executes this Release, Executive has been provided all leaves (paid and unpaid) and paid all wages and compensation owed to Executive by the Company Parties with the exception of
all payments owed as a condition of Executive’s executing (and not revoking) this Release. 
 3. Acknowledgments. By
executing and delivering this Release, Executive acknowledges that: 
 (a) Executive has carefully read this Release; 

(b) Executive has had at least twenty-one (21) days to consider this Release before the execution and delivery hereof to the Company; 

(c) Executive has been and hereby is advised in writing that Executive may, at Executive’s option, discuss this Release with an attorney
of Executive’s choice and that Executive has had adequate opportunity to do so; and 
 (d) Executive fully understands the final and
binding effect of this Release; the only promises made to Executive to sign this Release are those stated in the Agreement and herein; and Executive is signing this Release voluntarily and of Executive’s own free will, and that Executive
understands and agrees to each of the terms of this Release. 

 4. Revocation Right. Executive may revoke this Release within the seven day period
beginning on the date Executive signs this Release (such seven day period being referred to herein as the “Release Revocation Period”). To be effective, such revocation must be in writing signed by Executive and must be
delivered to the Chief Executive Officer of the Company before 11:59 p.m., Houston, Texas time, on the last day of the Release Revocation Period. This Release is not effective, and no further consideration shall be provided to Executive, unless the
expiration of the Release Revocation Period expires without Executive’s revocation. If an effective revocation is delivered in the foregoing manner and timeframe, this Release shall be of no force or effect and shall be null and void ab
initio. 
 Executed on this             day of
            , 2015. 
  

	
	  

	Wendell R. Brooks

 STATE OF
                                        
§ 
 COUNTY OF
                                    § 

BEFORE ME, the undersigned authority personally appeared Wendell R. Brooks, by me known or who produced valid identification as described
below, who executed the foregoing instrument and acknowledged before me that he subscribed to such instrument on this             day of
            , 2015. 
  

	
	  

	NOTARY PUBLIC in and for the
	
	State of                 
	
	My Commission Expires:
	
	  

	
	Identification produced:EXHIBIT 4.1

 

NEITHER THIS SECURITY NOR THE SECURITIES
FOR WHICH THIS SECURITY IS EXERCISABLE HAVE BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION OR THE SECURITIES COMMISSION
OF ANY STATE IN RELIANCE UPON AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES
ACT”), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES
ACT OR PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES
ACT AND IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS AS EVIDENCED BY A LEGAL OPINION OF COUNSEL TO THE TRANSFEROR TO SUCH
EFFECT, THE SUBSTANCE OF WHICH SHALL BE REASONABLY ACCEPTABLE TO THE COMPANY. THIS SECURITY AND THE SECURITIES ISSUABLE UPON EXERCISE
OF THIS SECURITY MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT OR OTHER LOAN SECURED BY SUCH SECURITIES.

 

FORM OF COMMON STOCK PURCHASE WARRANT

 

Majesco
entertainment company

 

	Warrant Shares: [______]	Initial Issuance Date:  [___], 2014

 

Warrant No: [______]

 

THIS COMMON STOCK PURCHASE
WARRANT (the “Warrant”) certifies that, for value received, [______] 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 the Initial Issuance Date (the “Initial Exercise Date”) and on or prior to the close of business on
the five (5) year anniversary of the Initial Exercise Date (the “Termination Date”) but not thereafter, to subscribe
for and purchase from MAJESCO ENTERTAINMENT COMPANY, 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).

 

Section 1.           Definitions.
Capitalized terms used and not otherwise defined herein shall have the meanings set forth in that certain Subscription Agreement
(the “Subscription Agreement”), dated [____] 2014, among the Company and the purchasers signatory thereto.

 

    	 

    	 

    

 

Section 2.           Exercise.

 

a)
         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 such other office or agency of the Company as it may designate by notice in writing
to the registered Holder at the address of the Holder appearing on the books of the Company) of a duly executed facsimile copy
of the Notice of Exercise Form annexed hereto. Within two (2) Trading Days 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 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. Notwithstanding anything herein to the contrary (although the Holder may surrender the Warrant to,
and receive a replacement Warrant from, the Company), 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 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 Company 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 Form within one (1) Trading Day of delivery 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.

 

b)
         Exercise Price. The initial exercise
price per share of the Common Stock under this Warrant shall be $0.68, (the “Initial Exercise Price”) subject
to adjustment hereunder (as adjusted, the “Exercise Price”), payable, subject to Section 2(c) below, in immediately
available funds. 

 

c)
         Cashless Exercise. If at any time there
is no effective registration statement registering, or no current prospectus available for the resale of the Warrant Shares by
the Holder, then this Warrant may also be exercised at the Holder’s election, 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) = the
VWAP on the Trading Day immediately preceding the date on which Holder elects to exercise this Warrant by means of a “cashless
exercise,” as set forth in the applicable Notice of Exercise;

 

(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.

 

Notwithstanding
anything herein to the contrary, on the Termination Date, unless the Holder notifies the Company otherwise, if there is no effective
Registration Statement registering, or no current prospectus available for, the resale of the Warrant Shares by the Holder, then
this Warrant shall be automatically exercised via cashless exercise pursuant to this Section 2(c).

 

    	2

    	 

    

 

d)
          Mechanics of Exercise. 

 

(a)          Delivery
of Certificates Upon Exercise. Certificates for shares purchased hereunder shall be transmitted by the Company’s transfer
agent for its Common Stock (the “Transfer Agent”) to the Holder by crediting the account of the Holder’s
prime broker 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 Rule 144 is available, and otherwise by physical delivery to the address specified by the Holder in the Notice of
Exercise by the date that is three (3) Trading Days after the latest of (A) the delivery to the Company of the Notice of Exercise,
(B) surrender of this Warrant (if required) and (C) payment of the aggregate Exercise Price as set forth above (including by cashless
exercise, if permitted) (such date, the “Warrant Share Delivery Date”). The Warrant Shares shall be deemed to
have been issued, and Holder or any other person so designated to be named therein shall be deemed to have become a holder of record
of such shares for all purposes, as of the date the Warrant has been exercised, with payment to the Company of the Exercise Price
(or by cashless exercise, if permitted) and all taxes required to be paid by the Holder, if any, pursuant to Section 2(d)(vi) prior
to the issuance of such shares, having been paid. The Company understands that a delay in the delivery of the Warrant Shares after
the Warrant Share Delivery Date could result in economic loss to the Holder. As compensation to the Holder for such loss, the Company
agrees to pay (as liquidated damages and not as a penalty) to the Holder for late issuance of Warrant Shares upon exercise of this
Warrant the proportionate amount of $10 per Trading Day (increasing to $20 per Trading Day after the fifth (5th) Trading
Day) after the Warrant Share Delivery Date for each $1,000 of Exercise Price of Warrant Shares for which this Warrant is exercised
which are not timely delivered. The Company shall pay any payments incurred under this Section in immediately available funds upon
demand. Furthermore, in addition to any other remedies which may be available to the Holder, in the event that the Company fails
for any reason to effect delivery of the Warrant Shares by the Warrant Share Delivery Date, the Holder may revoke all or part of
the relevant Warrant exercise by delivery of a notice to such effect to the Company, whereupon the Company and the Holder shall
each be restored to their respective positions immediately prior to the exercise of the relevant portion of this Warrant, except
that the liquidated damages described above shall be payable through the date notice of revocation or rescission is given to the
Company.

 

i.            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 certificate or certificates representing 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.

 

ii.         Rescission
Rights. If the Company fails to cause the Transfer Agent to transmit to the Holder a certificate or the certificates representing
the Warrant Shares pursuant to Section 2(d)(i) by the Warrant Share Delivery Date, then the Holder will have the right, at any
time prior to issuance of such Warrant Shares, to rescind such exercise.

 

    	3

    	 

    

 

iii.         Compensation
for Buy-In on Failure to Timely Deliver Certificates 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 a certificate or the certificates representing the Warrant
Shares pursuant to an exercise on or before the Warrant Share Delivery Date, 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 certificates representing shares of Common Stock
upon exercise of the Warrant as required pursuant to the terms hereof.

 

iv.         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.

 

v.           Charges,
Taxes and Expenses. Issuance of certificates for 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 such certificate, all of which taxes and expenses shall
be paid by the Company, and such certificates 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 certificates for 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.

 

vi.         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.

 

    	4

    	 

    

 

e)
         Holder’s Exercise Limitations.
(i)          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),
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 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 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.  Except as set forth in the preceding sentence, for purposes of this Section 2(e), 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.
To the extent that the limitation contained in this Section 2(e) applies, the determination of whether this Warrant is exercisable
(in relation to other securities owned by the Holder together with any Affiliates) and of which portion of this Warrant is exercisable
shall be in the sole discretion of the Holder, and 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 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(e), 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 two Trading Days 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 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 Holder may decrease the Beneficial
Ownership Limitation at any time and the Holder, upon not less than 61 days’ prior notice to the Company, may increase the
Beneficial Ownership Limitation provisions of this Section 2(e), provided that the Beneficial Ownership Limitation in no event
exceeds 9.99% of the number of shares of the Common Stock outstanding immediately after giving effect to the issuance of shares
of Common Stock upon exercise of this Warrant held by the Holder and the provisions of this Section 2(e) shall continue to apply.
Any such increase will not be effective until the 61st day after such notice is delivered to the Company. 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(e) 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. 

 

    	5

    	 

    

 

(ii)        Issuance
Restrictions. (i) If the Company has not obtained the approval of its shareholders in accordance with NASDAQ Listing Rule 5635(d),
then the Company may not issue upon exercise of this Warrant a number of Warrant Shares, which, when aggregated with any shares
of Common Stock (i) issued pursuant to the Subscription Agreement, (ii) issuable upon conversion of the Series A Preferred Stock
issued pursuant to the Subscription Agreement; (iii) issuable upon prior exercise of this or any other Warrant issued pursuant
to the Subscription Agreement and (iv) issuable pursuant to any warrants issued to any registered broker-dealer as a fee in connection
with the issuance of Securities pursuant to the Subscription Agreement, would exceed 19.99% shares of Common Stock issued and outstanding
as of the Initial Issuance Date, subject to adjustment for reverse and forward stock splits, stock dividends, stock combinations
and other similar transactions of the Common Stock that occur after the date of the Subscription Agreement (such number of shares,
the “Issuable Maximum”). The Holder and the holders of the other Warrants issued pursuant to the Subscription
Agreement shall be entitled to a portion of the Issuable Maximum equal to the quotient obtained by dividing (x) the Holder’s
original Aggregate Purchase Price by (y) the aggregate original Aggregate Purchase Price of all Purchasers pursuant to the Subscription
Agreement. In addition, the Holder may allocate its pro-rata portion of the Issuable Maximum among Warrants held by it in its sole
discretion. Such portion shall be adjusted upward ratably in the event a Holder no longer holds any Warrants and the amount of
shares issued to such Holder pursuant to its Warrants was less than such Holder’s pro-rata share of the Issuable Maximum.
For avoidance of doubt, unless and until any required approval of the Company’s shareholders of the issuance of the Common
Stock underlying the Shares and the Warrant Shares pursuant to the Subscription Agreement (“Shareholder Approval”)
is obtained and effective, warrants issued to any registered broker-dealer as a fee in connection with the Securities issued pursuant
to the Subscription Agreement as described in clause (iii) above shall provide that such warrants shall not be allocated any portion
of the Issuable Maximum and shall be unexercisable unless and until such Shareholder Approval is obtained and effective. 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 or pursuant to any of
the other Transaction Documents), (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.

 

    	6

    	 

    

 

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 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).

 

c)
         Pro Rata Distributions. If the Company,
at any time while this Warrant is outstanding, shall distribute to all holders of Common Stock (and not to the Holder) evidences
of its indebtedness or assets (including cash and cash dividends) or rights or warrants to subscribe for or purchase any security
other than the Common Stock (which shall be subject to Section 3(c)), then in each such case the Exercise Price shall be adjusted
by multiplying the Exercise Price in effect immediately prior to the record date fixed for determination of stockholders entitled
to receive such distribution by a fraction of which the denominator shall be the VWAP determined as of the record date mentioned
above, and of which the numerator shall be such VWAP on such record date less the then per share fair market value at such record
date of the portion of such assets or evidence of indebtedness so distributed applicable to one outstanding share of the Common
Stock as determined by the Board of Directors in good faith. In either case the adjustments shall be described in a statement provided
to the Holder of the portion of assets or evidences of indebtedness so distributed or such subscription rights applicable to one
share of Common Stock. Such adjustment shall be made whenever any such distribution is made and shall become effective immediately
after the record date mentioned above.

 

    	7

    	 

    

 

d)
         Fundamental Transaction. If, at any
time while this Warrant is outstanding, the Company enters into 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(e) 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(e) 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. 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 and the
other Transaction Documents in accordance with the provisions of this Section 3(e) pursuant to written agreements in form and substance
reasonably satisfactory to the Holder and approved by the Holder (without unreasonable delay) 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), and which is reasonably
satisfactory in form and substance to the Holder. 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 and the other Transaction Documents 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
and the other Transaction Documents with the same effect as if such Successor Entity had been named as the Company herein. 

 

e)
         Adjustment of Exercise Price Upon Issuance
of New Securities at Less Than the Exercise Price. In the event the Company shall, at any time after the date hereof and on
or prior to the twenty-four month anniversary of the Initial Issuance Date, other than in connection an Excluded Issuance, issue
any Common Stock or Common Stock Equivalents, for a consideration less than the Exercise Price that would be in effect at the time
of such issuance, then, and thereafter successively upon each such issuance, the Exercise Price shall be reduced to such other
lower price for then outstanding Warrants. For purposes of this adjustment, any agreement entered for or the issuance of any security
or debt instrument of the Company carrying the right to convert such security or debt instrument into Common Stock or of any warrant,
right or option to purchase Common Stock shall result in an adjustment to the Exercise Price upon the issuance of the above-described
security, debt instrument, warrant, right, or option if such issuance is at a price lower than the Exercise Price in effect upon
such issuance and again at any time upon any actual, permitted, optional, or allowed issuances of shares of Common Stock upon any
actual, permitted, optional, or allowed exercise of such conversion or purchase rights if such issuance is at a price lower than
the Exercise Price in effect upon any actual, permitted, optional, or allowed such issuance. Common Stock issued or issuable by
the Company for no consideration will be deemed issuable or to have been issued for $0.001 per share of Common Stock. 

 

    	8

    	 

    

 

f)          Adjustment
of Exercise Price in Connection with Litigation Resolution. Notwithstanding anything herein to the contrary, in the event that
Post-Closing Litigation Costs (as defined below) exceed Six Hundred Thousand Dollars ($600,000) but are less than One Million Dollars
($1,000,000), then, in such event the Initial Exercise Price shall immediately be adjusted to $0.51 per share; and in the event
that Post-Closing Litigation Costs are equal to or exceed One Million Dollars ($1,000,000), then in such event the Initial Exercise
Price shall immediately be adjusted to $0.34 per share. For purposes hereof, “Post Closing Litigation Costs”
shall mean with respect to Intelligent Verification Systems LLC v Microsoft Corporation and Majesco Entertainment Co. (Case
No. 2:12-cv-00525-AWA-TEM) (the “Patent Litigation”) and incurred or paid from and following the Initial Issuance
Date, all costs associated with the Patent Litigation, including, but not limited to, any hourly or contract rates of counsel,
costs, expenses, bonuses, compensation, payments, reimbursements or any other sums (including, but not limited to, expert witness
fees, deposition expenses, trial costs, document management charges or other similar fees, expenses or charges) paid by the Company
in defending the Patent Litigation, outside contractors, experts, specialists, advisors, representatives or agents in connection
with the Patent Litigation and any payments made in connection with the settlement, judgment or other resolution of the Patent
Litigation (including the costs of any appeals and interpartes review proceedings).

 

g)
         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.

 

h)
         Notice to Holder. 

 

i.            Adjustment
to Exercise Price. Whenever the Exercise Price is adjusted pursuant to any provision of this Section 3, the Company shall promptly
mail to the Holder 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.

 

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, 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, to the extent that such information constitutes material non-public information
(as determined in good faith by the Company) the Company shall shall deliver to the Holder at its last address as it shall appear
upon the Warrant Register of the Company, at least 20 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 mail such notice or any defect therein or in the mailing thereof shall not affect the validity of the corporate
action required to be specified in such notice. To the extent that any notice provided hereunder 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.

 

    	9

    	 

    

 

Section 4.            Transfer
of Warrant.

 

a)
         Transferability. Subject to compliance
with any applicable securities laws and the provisions of the Subscription Agreement, this Warrant and all rights hereunder (including,
without limitation, any registration rights) are transferable, in whole or in part, upon surrender of this Warrant at the principal
office of the Company or its designated agent, together with a written assignment of this Warrant substantially in the form attached
hereto duly executed by the Holder or its agent or attorney and funds sufficient to pay any transfer taxes payable upon the making
of such transfer. 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 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. 

 

b)
         New Warrants. This Warrant may be divided
or combined with other Warrants upon presentation hereof at the aforesaid office of the Company, 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 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 initial issuance date of this Warrant and shall be identical
with this Warrant except as to the number of Warrant Shares issuable pursuant thereto. 

 

c)
         Warrant Register. The Company shall
register this Warrant, upon records to be maintained by the Company for that purpose (the “Warrant Register”),
in the name of the record Holder hereof from time to time. The Company 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.

 

    	10

    	 

    

 

Section 5.          Certain
Definitions. For purposes of this Warrant, the following terms shall have the following meanings:

 

(a)          “Affiliate”
shall mean as applied to any Person, means any other Person directly or indirectly controlling, controlled by, or under common
control with, that Person. For the purposes of this definition, “control” (including, with correlative meanings, the
terms “controlling”, “controlled by” and “under common control with”), as applied to any Person,
means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of that
Person, whether through the ownership of voting securities or by contract or otherwise. For purposes of this definition, a Person
shall be deemed to be “controlled by” a Person if such latter Person possesses, directly or indirectly, power
to vote 10% or more of the securities having ordinary voting power for the election of directors of such former Person

 

(b)          “Approved
Stock Plan” shall mean any benefit or incentive plan which has been approved by the board of directors of the Company
prior to or subsequent to the date hereof pursuant to which shares of Common Stock and options or equivalent Common Stock linked
interests may be issued to any employee, officer, director, consultant for services provided to the Company.

 

(c)          “Bloomberg”
means Bloomberg Financial Markets.

 

(d)          “Business
Day” means any day other than Saturday, Sunday or other day on which commercial banks in The City of New York are authorized
or required by law to remain closed.

 

(e)         “Closing
Bid Price” and “Closing Sale Price” means, for any security as of any date, the last closing bid price
and last closing trade price, respectively, for such security on the Principal Market, as reported by Bloomberg, or, if the Principal
Market begins to operate on an extended hours basis and does not designate the closing bid price or the closing trade price, as
the case may be, then the last bid price or the last trade price, respectively, of such security prior to 4:00:00 p.m., New York
time, as reported by Bloomberg, or, if the Principal Market is not the principal securities exchange or trading market for such
security, the last closing bid price or last trade price, respectively, of such security on the principal securities exchange or
trading market where such security is listed or traded as reported by Bloomberg, or if the foregoing do not apply, the last closing
bid price or last trade price, respectively, of such security in the over-the-counter market on the electronic bulletin board for
such security as reported by Bloomberg, or, if no closing bid price or last trade price, respectively, is reported for such security
by Bloomberg, the average of the bid prices, or the ask prices, respectively, of any market makers for such security as reported
in the “pink sheets” by the OTC Markets Group LLC. If the Closing Bid Price or the Closing Sale Price cannot be calculated
for a security on a particular date on any of the foregoing bases, the Closing Bid Price or the Closing Sale Price, as the case
may be, of such security on such date shall be the fair market value as mutually determined by the Company and the Holder. All
such determinations to be appropriately adjusted for any stock dividend, stock split, stock combination or other similar transaction
during the applicable calculation period.

 

(f)          “Common
Stock” means (i) the Company’s shares of Common Stock, par value $0.001 per share, and (ii) any share capital into
which such Common Stock shall have been changed or any share capital resulting from a reclassification of such Common Stock.

 

(g)          “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

 

    	11

    	 

    

 

(h)          “Convertible
Securities” shall mean any stock or other security (other than Options) that is at any time and under any circumstances,
directly or indirectly, convertible into, exercisable or exchangeable for, or which otherwise entitles the holder thereof to acquire,
any shares of Common Stock

 

(i)          “Eligible
Market” means the Principal Market, The New York Stock Exchange, Inc., The NYSE MKT, The NASDAQ Global Market, The NASDAQ
Capital Market, the Over the Counter Bulletin Board, the OTCQX or the OTCQB.

 

(f)          
“Excluded Issuance” shall mean any (i) shares of Common Stock or options to purchase Common Stock issued to
directors, officers, employees or consultants of the Company pursuant to any Approved Stock Plan adopted on or following the Initial
Issuance Date, provided that (A) all such issuances (taking into account the shares of Common Stock issuable upon exercise of such
options) after the INitial Issuance Date pursuant to this clause (i) do not, in the aggregate, exceed more than 15% of the Common
Stock issued and outstanding at the time of such issuance and (B) the exercise price of any such options is not lowered after issuance
by subsequent amendment thereof, none of such options are amended subsequent to issuance to increase the number of shares issuable
thereunder and none of the terms or conditions of any such options are subsequent to issuance otherwise materially changed in any
manner that adversely affects any of the Holders of Warrants; (ii) shares of Common Stock issued upon the conversion or exercise
of Convertible Securities or contractual agreements (other than options to purchase Common Stock or other equity incentive awards
issued pursuant to an Approved Stock Plan that are covered by clause (i) above) issued prior to the date hereof, provided that
the conversion price of any such Convertible Securities (other than options to purchase Common Stock issued pursuant to an Approved
Stock Plan that are covered by clause (i) above) is not lowered by subsequent amendment, none of such Convertible Securities (other
than standard options to purchase Common Stock issued pursuant to an Approved Stock Plan that are covered by clause (i) above)
are subsequently amended to increase the number of shares issuable thereunder and none of the terms or conditions of any such Convertible
Securities (other than options to purchase Common Stock issued pursuant to an Approved Stock Plan that are covered by clause (i)
above) are otherwise materially changed in any manner that adversely affects any of the Holders; and (iii) the shares of Common
Stock issuable upon conversion of the Series A Preferred Stock issuable pursuant to the Subscription Agreement or the Warrants.

 

(g)          “Fundamental
Transaction” means that (i) the Company or any of its Subsidiaries shall, directly or indirectly, in one or more related
transactions, (1) consolidate or merge with or into (whether or not the Company or any of its Subsidiaries is the surviving corporation)
any other person, or (2) sell, lease, license, assign, transfer, convey or otherwise dispose of all or substantially all of its
respective properties or assets to any other person, or (3) allow any other person to make a purchase, tender or exchange offer
that is accepted by the holders of more than 50% of the outstanding shares of Voting Stock of the Company (not including any shares
of Voting Stock of the Company held by the person or persons making or party to, or associated or affiliated with the persons making
or party to, such purchase, tender or exchange offer), or (4) consummate a stock or share purchase agreement or other business
combination (including, without limitation, a reorganization, recapitalization, spin-off or scheme of arrangement) with any other
person whereby such other person acquires more than 50% of the outstanding shares of Voting Stock of the Company (not including
any shares of Voting Stock of the Company 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), or (5) (I) reorganize,
recapitalize or reclassify the Common Stock, (II) effect or consummate a stock combination, reverse stock split or other similar
transaction involving the Common Stock or (III) make any public announcement or disclosure with respect to any stock combination,
reverse stock split or other similar transaction involving the Common Stock (including, without limitation, any public announcement
or disclosure of (x) any potential, possible or actual stock combination, reverse stock split or other similar transaction involving
the Common Stock or (y) board or stockholder approval thereof, or the intention of the Company to seek board or stockholder approval
of any stock combination, reverse stock split or other similar transaction involving the Common Stock), or (ii) any “person”
or “group” (as these terms are used for purposes of Sections 13(d) and 14(d) of the Exchange Act and the rules and
regulations promulgated thereunder) is or shall become the “beneficial owner” (as defined in Rule 13d-3 under the Exchange
Act), directly or indirectly, of 50% of the aggregate ordinary voting power represented by issued and outstanding Voting Stock
of the Company.

 

    	12

    	 

    

 

(h)          “Person”
means an individual, a limited liability company, a partnership, a joint venture, a corporation, a trust, an unincorporated organization,
any other entity and a government or any department or agency thereof.

 

(i)          “Principal
Market” means The NASDAQ Capital Market or the principal securities exchange or securities market on which the Common
Stock is then quoted or traded.

 

 (j)          “Options”
means any rights, warrants or options to subscribe for or purchase shares of Common Stock or Convertible Securities

 

 (k)          “Rule
144” means Rule 144 promulgated by the SEC pursuant to the Securities Act, as such Rule may be amended or interpreted
from time to time, or any similar rule or regulation hereafter adopted by the Commission having substantially the same purpose
and effect as such Rule

 

 (l)         “Subsidiary”
means any subsidiary of the Company including any direct or indirect subsidiary of the Company formed or acquired after the date
hereof.

 

(m)          “Trading
Day” means any day on which the Common Stock are traded on the Principal Market, or, if the Principal Market is not the
principal trading market for the Common Stock, then on the principal securities exchange or securities market on which the Common
Stock are then traded; provided that “Trading Day” shall not include any day on which the Common Stock are scheduled
to trade on such exchange or market for less than 4.5 hours or any day that the Common Stock are suspended from trading during
the final hour of trading on such exchange or market (or if such exchange or market does not designate in advance the closing time
of trading on such exchange or market, then during the hour ending at 4:00:00 p.m., New York time).

 

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

 

(o)          “VWAP”
means, for any security as of any date, the dollar volume-weighted average price for such security on the Principal Market (or,
if the Principal Market is not the principal trading market for such security, then on the principal securities exchange or securities
market on which such security is then traded) during the period beginning at 9:30:01 a.m., New York time, and ending at 4:00:00
p.m., New York time, as reported by Bloomberg through its “HP” function set to “weighted average” or, if
the foregoing does not apply, the dollar volume-weighted average price of such security in the over-the-counter market on the electronic
bulletin board for such security during the period beginning at 9:30:01 a.m., New York time, and ending at 4:00:00 p.m., New York
time, as reported by Bloomberg, or, if no dollar volume-weighted average price is reported for such security by Bloomberg for such
hours, the average of the highest closing bid price and the lowest closing ask price of any of the market makers for such security
as reported in the “pink sheets” by OTC Markets Group Inc. (formerly Pink Sheets LLC). If the VWAP cannot be calculated
for such security on such date on any of the foregoing bases, the VWAP of such security on such date shall be the fair market value
as mutually determined by the Company and such Holder. If the Company and such Holder are unable to agree upon the fair market
value of such security, then such dispute shall be resolved in accordance with the procedures in Section 22. All such determinations
shall be appropriately adjusted for any stock dividend, stock split, stock combination or other similar transaction during such
period

 

    	13

    	 

    

 

Section 6.          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(d)(i).

 

b)        Loss,
Theft, Destruction or Mutilation of Warrant. The Company covenants that upon receipt by the Company of evidence reasonably
satisfactory to it of the loss, theft, destruction or mutilation of this Warrant or any stock certificate relating to the Warrant
Shares, and in case of loss, theft or destruction, of indemnity or security reasonably satisfactory to it (which, in the case of
the Warrant, shall not include the posting of any bond), and upon surrender and cancellation of such Warrant or stock certificate,
if mutilated, the Company will make and deliver a new Warrant or stock certificate of like tenor and dated as of such cancellation,
in lieu of such Warrant or stock certificate.

 

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 Trading Day, then, such action may be taken or such right may be exercised on the next succeeding
Trading Day.

 

d)        Authorized
Shares.

 

(i)          The
Company covenants that, during the period the Warrant is outstanding, it will reserve from its authorized and unissued Common Stock
125% of the maximum number of shares 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 executing stock certificates to execute and issue the necessary certificates for the 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 Principal 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
non-assessable 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).

 

    	14

    	 

    

 

(ii)         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.

 

(iii)        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)Jurisdiction.
All questions concerning the construction, validity, enforcement and interpretation of this Warrant shall be determined in accordance
with the provisions of the Subscription Agreement.

 

f)         Restrictions.
The Holder acknowledges that the Warrant Shares acquired upon the exercise of this Warrant, if not registered, or unless exercised
in a cashless exercise when Rule 144 is available, and the Holder does not utilize cashless exercise, will have restrictions upon
resale imposed by state and federal securities laws.

 

g)        Non-waiver
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. Without limiting any other provision
of this Warrant or the Subscription Agreement, 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.

 

h)        Notices.
Any notice, request or other document required or permitted to be given or delivered to the Holder by the Company shall be delivered
in accordance with the notice provisions of the Subscription Agreement.

 

i)         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.

 

    	15

    	 

    

 

j)         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.

 

k)         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.

 

l)         Amendment.
This Warrant may be modified or amended or the provisions hereof waived with the written consent of the Company and the Holders
of not less than a 60% of the then outstanding Warrants issued pursuant to the Subscription Agreement which such approval shall
include the approval of the Lead Investor.

 

m)        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.

 

    	16

    	 

    

 

n)        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)

 

    	17

    	 

    

 

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.

 

	 	majesco entertainment company
	 	 
	 	By:	 
	 	 	Name:
	 	 	Title:

 

    	18

    	 

    

 

NOTICE OF EXERCISE

 

To:majesco
entertainmetn company

 

(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 a certificate or certificates representing said Warrant Shares in the name of the undersigned or in such other name as is
specified below:

 

_______________________________

 

(4)   After
giving effect to this Notice of Exercise, the undersigned will not have exceeded the Beneficial Ownership Limitation.

 

The Warrant Shares shall be delivered to
the following DWAC Account Number or by physical delivery of a certificate to:

 

_______________________________

 

_______________________________

 

_______________________________

 

 

[SIGNATURE
OF HOLDER]

 

Name of Investing Entity: _______________________________________________________________________________

Signature of Authorized Signatory of
Investing Entity: _________________________________________________________

Name of Authorized Signatory: ___________________________________________________________________________

Title of Authorized Signatory: ____________________________________________________________________________

Date: _______________________________________________________________________________________________

 

    	 

    	 

    

 

ASSIGNMENT FORM

 

(To assign the foregoing warrant, execute

this form and supply required information.

Do not use this form to exercise the warrant.)

 

MAJESCO
ENTERTAINMENT COMPANY

 

FOR VALUE RECEIVED, [____]
all of or [_______] shares of the foregoing Warrant and all rights evidenced thereby are hereby assigned to

 

_______________________________________________
whose address is

 

_______________________________________________________________.

 

_______________________________________________________________

 

Dated: ______________, _______

 

	 	Holder’s Signature:	_____________________________
	 	 	 
	 	Holder’s Address:	_____________________________
	 	 	 
	 	 	_____________________________

 

Signature Guaranteed: ___________________________________________

 

NOTE: The signature to this Assignment
Form must correspond with the name as it appears on the face of the Warrant, without alteration or enlargement or any change whatsoever,
and must be guaranteed by a bank or trust company. Officers of corporations and those acting in a fiduciary or other representative
capacity should file proper evidence of authority to assign the foregoing Warrant.

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