Document:

Exhibit
10.3

 

SECURITIES
EXCHANGE AGREEMENT

 

This
SECURITIES EXCHANGE AGREEMENT (this “Agreement”) is made effective as of February 28, 2017, by and between
InterCloud Systems, Inc. (the “Company”), and JGB (Cayman) Waltham Ltd. (“JGBWL”).

 

RECITALS

 

WHEREAS,
the Company and JGBWL are parties to the Securities Purchase Agreement dated as of December 29, 2015 (as may be amended, amended
and restated, supplemented or otherwise modified from time to time, the “Securities Purchase Agreement”) pursuant
to which the Company and JGBWL have certain rights and obligations; and

 

WHEREAS,
the Company and JGBWL have agreed to enter into this Agreement pursuant to which JGBWL’s additional investment rights under
Section 4.13 of the Securities Purchase Agreement (the “AIR”) are exchanged for a warrant to purchase
shares of the Company’s common stock in substantially the form set forth in Exhibit A hereto (the “Warrant”);

 

NOW,
THEREFORE, in consideration of the foregoing premises and the mutual covenants and agreements contained herein and for other
good and valuable consideration, the receipt and adequacy of which are hereby acknowledged, intending to be legally bound, the
parties hereto agree as follows:

 

AGREEMENT

 

ARTICLE
I. EXCHANGE

 

1.01        Warrant.
On the date of this Agreement, the Company will execute and deliver the Warrant to JGBWL.

 

1.02        Additional
Investment Right. Upon receipt of the Exchange Consideration (as defined below), JGBWL will transfer, convey and assign all
rights and obligations to the AIR under Section 4.13 of the Securities Purchase Agreement to the Company.

 

1.03         Legal
Opinion. On the date of this Agreement, counsel to the Company shall issue a legal opinion opining that the exchange contemplated
hereby is exempt from registration under Section 3(a)(9) of the Securities Act of 1933, as amended (the “Securities
Act’).

 

ARTICLE
II. REPRESENTATIONS AND WARRANTIES OF THE COMPANY

 

The
Company represents and warrants to JGBWL as of the date hereof as follows:

 

2.01         Organization, Good Standing and Power. The Company is a corporation duly incorporated, validly existing and in good standing
under the laws of the State of Delaware and has the requisite corporate power to own, lease and operate its properties and assets
and to conduct its business as it is now being conducted.

 

2.02         Authorization;
Enforcement. The Company has the requisite corporate power and authority to enter into and perform this Agreement, the Warrant,
and each other agreement, instrument and certificate executed and delivered by the Company in connection with the foregoing (collectively,
the “Operative Documents”) and to issue the Warrant in accordance with the terms hereof. The execution,
delivery and performance of the Operative Documents by the Company and the consummation by it of the transactions contemplated
thereby have been duly and validly authorized by all necessary corporate action, and no further consent or authorization of the
Company or its Board of Directors or stockholders is required. When executed and delivered by the Company, each of the Operative
Documents shall constitute a valid and binding obligation of the Company, enforceable against the Company in accordance with its
terms, except as such enforceability may be limited by applicable bankruptcy, reorganization, moratorium, liquidation, conservatorship,
receivership or similar laws relating to, or affecting generally the enforcement of, creditor’s rights and remedies or by other
equitable principles of general application.

 

     

     

    

 

2.03       
Issuance of Shares. When the shares underlying the Warrant (the “Warrant Shares”) are issued in
accordance with the terms of the Warrant, the Warrant Shares shall be validly issued and outstanding, fully-paid, non-assessable
and free any clear of all liens, of any pre-emptive rights and rights of refusal of any kind.

 

2.04         No
Conflicts. The execution, delivery and performance of the Operative Documents by the Company, the performance by
the Company of its obligations under the Operative Documents, and the consummation by the Company of the transactions
contemplated by the Operative Documents, and the issuance of the Warrant Shares as contemplated by the Operative Documents,
do not and will not (i) violate or conflict with any provision of the Company’s Certificate of incorporation (the “Certificate
of Incorporation”) or Bylaws (the “Bylaws”), each as amended to date, (ii) conflict
with, or constitute a default (or an event which with notice or lapse of time or both would become a default) under, or give
to others any rights of termination, amendment, acceleration or cancellation of, any agreement, mortgage, deed of trust,
indenture, note, bond, license, lease agreement, instrument or obligation to which the Company or any of its subsidiaries is
a party or by which the Company or any of its subsidiaries’ respective properties or assets are bound, (iii) result in
a violation of any foreign, federal, state or local statute, law, rule, regulation, order, judgment or decree (including
federal and state securities laws and regulations) applicable to the Company or any of its subsidiaries or by which any
property or asset of the Company or any of its subsidiaries are bound or affected, or (iv) create or impose a lien, mortgage,
security interest, charge or encumbrance of any nature below (each, a “Lien”) on any property or
asset of the Company or its subsidiaries under any agreement or any commitment to which the Company or any of its
subsidiaries is a party or by which the Company or any of its Subsidiaries is bound or by which any of their
respective properties or assets are bound, except, in the case of clauses (ii), (iii) and (iv), for such conflicts, defaults,
terminations, amendments, violations, acceleration, cancellations, creations and impositions as would not, individually or in
the aggregate, reasonably be expected to have or result in any material adverse effect on the business, operations,
properties, prospects, or condition (financial or otherwise) of the Company and its subsidiaries taken as a whole and/or any
condition, circumstance, or situation that would prohibit in any material respect the ability of the Company to perform any
of its obligations under this Agreement or any of the other Operative Documents in any material respect. Neither the Company
nor any of its Subsidiaries is required under foreign, federal, state or local law, rule or regulation to obtain any consent,
authorization or order of, or make any filing or registration with, any court or governmental agency in order for it to
execute, deliver or perform any of its obligations under the Operative Documents or issue the Warrant in accordance with the
terms hereof.

 

2.05         SEC Documents, Financial Statements. The common stock of the Company is registered pursuant to Section 12(g) of the Securities
Exchange Act of 1934, as amended (the ”1934 Act”), and, since January I, 2013, the Company has timely
filed (or has received a valid extension of such time of filing and has filed any such reports prior to the expiration of any
such extension) all reports, schedules, forms, statements and other documents required to be filed by it with the SEC pursuant
to the reporting requirements of the 1934 Act (all of the foregoing including f0ilings incorporated by reference therein being
referred to herein as the “SEC Documents”). At the times of their respective filings, the SEC Documents
complied in all material respects with the requirements of the 1934 Act and the rules and regulations of the SEC promulgated thereunder.
The SEC Documents did not, and do not, contain any untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which
they were made, not misleading. As of their respective dates, the financial statements of the Company included in the SEC Documents
complied as to form in all material respects with Regulation S-X and all other published rules and regulations of the SEC. Such
financial statements have been prepared in accordance with generally accepted accounting principles (“GAAP’)
applied on a consistent basis during the periods involved (except (i) as may be otherwise indicated in such financial statements
or the notes thereto or (ii) in the case of unaudited interim statements, to the extent they may not include footnotes or may
be condensed or summary statements), and fairly present in all material respects the financial position of the Company and its
consolidated Subsidiaries as of the dates thereof and the results of operations and cash flows for the periods then ended (subject,
in the case of unaudited statements, to normal year-end audit adjustments). The Company has no reason to believe that it will
not timely file its Annual Report on From 10-K for the year ended December 31, 2016, or its Quarterly Report on Form 10-Q for
the quarterly period ended March 31, 2017.

 

    	 	2	 

     

    

 

2.06         Disclosure.
Following the issuance of the press release referred to in Section 4.04, except for the information concerning the transactions
contemplated by this Agreement, the Company confirms that neither it nor any other person or entity acting on its behalf has provided
JGBWL or its agents or counsel with any information that constitutes or might constitute material, nonpublic information. The
Company understands and confirms that JGBWL will rely on the foregoing representation in effecting transactions in the securities
of the Company.

 

2.07         Holding
Period. Pursuant to Rule 144 promulgated under the Securities Act, the holding period of the Warrant tacks back to December
29, 2015. The Company agrees not to take a position contrary to this paragraph. The Company agrees to take all actions, including,
without limitation, the issuance by its legal counsel of any legal opinions to JGBWL or the Company’s transfer agent, necessary
to issue the Warrant Shares without restriction and not containing any restrictive legend without the need for any action by JGBWL
in connection with a sale of the Warrant Shares by JGBWL. The Warrant (the “Exchange Consideration”) is
being issued in substitution and exchange for and not in satisfaction of all rights and obligations under Section 4.13 of the
Securities Purchase Agreement.

 

ARTICLE
III. REPRESENTATIONS AND WARRANTIES OF THE HOLDER

 

JGBWL
represents and warrants to the Company as of the date hereof as follows:

 

3.01         Organization and Standing of JGBWL. JGBWL is duly organized, validly existing and in good standing under the laws of the
jurisdiction of its organization.

 

3.02         Authorization and Power. JGBWL has the requisite power and authority to enter into and perform the Operative Documents.
The execution, delivery and performance of the Operative Documents by JGBWL and the consummation by it of the transactions contemplated
hereby have been duly authorized by all necessary corporate action, and no further consent or authorization of JGBWL or its managers
or members is required. When executed and delivered by JGBWL, the Operative Documents shall constitute valid and binding obligations
of JGBWL enforceable against JGBWL in accordance with their terms, except as such enforceability may be limited by applicable
bankruptcy, insolvency, reorganization, moratorium, liquidation, conservatorship, receivership or similar laws relating to, or
affecting generally the enforcement of, creditor’s rights and remedies or by other equitable principles of general application.

 

    	 	3	 

     

    

 

ARTICLE
IV. COVENANTS AND AGREEMENTS

 

Unless
otherwise specified in this Article, for so long as the Warrant and/or the Warrant Shares are outstanding, the Company and JGBWL
hereby covenant to each other:

 

4.01         Compliance with Laws; Commission. The Company shall take all necessary actions and proceedings as may be required by
applicable law, rule and regulation, for the legal and valid issuance (free from any restriction on transferability under federal
securities laws) of the Warrant Shares to JGBWL or the subsequent holders.

 

4.02         Registration and Listing. The Company shall cause its common stock to continue to be registered under Sections 12(g) or
Section 12(b) of the 1934 Act, to comply in all material respects with its reporting and filing obligations under the 1934 Act
and to not take any action or file any document (whether or not permitted by the Securities Act or the rules promulgated thereunder)
to terminate or suspend such registration or to terminate or suspend its reporting and filing obligations under the 1934 Act or
Securities Act even if the rules and regulations thereunder would permit such termination. Without limiting the foregoing, the
Company shall take all necessary action to satisfy the requirements of Rule I44(c)(l) and Rule 144(i)(2).

 

4.03         Pledge
of Warrant Shares. The Company acknowledges and agrees that the Warrant Shares may be pledged by JGBWL in connection with
a bona fide margin agreement or other loan or financing arrangement that is secured by the Warrant Shares. The pledge of the Warrant
Shares shall not be deemed to be a transfer, sale or assignment of the Warrant Shares hereunder, and JGBWL shall not be required
to provide the Company with any notice thereof or otherwise make any delivery to the Company pursuant to this Agreement or any
other Operative Document. The Company, at JGBWL’s expense hereby agrees to execute and deliver such documentation as JGBWL may
reasonably request in connection with a pledge of the Warrant Shares by JGBWL.

 

4.04         Disclosure
of Transaction. The Company shall on or before 8:00 a.m. eastern time on March 1, 2017, file a Current Report on Form 8-K,
disclosing the material terms of this Agreement, with the SEC. From and after the issuance of the press release, the Company represents
to JGBWL that it shall have publicly disclosed all material, non-public information delivered to JGBWL by the Company, or any
of their respective officers, directors, employees or agents.

 

4.5
         Further Assurance. JGBWL shall, at any time after the receipt
of the Warrant, promptly (i) execute (to the extent necessary) and deliver all commercially reasonable documents and
instruments reasonably required to assign, convey and transfer the AIR and related rights and obligations under Section 4.13
of the Securities Purchase Agreement to the Company. The foregoing shall be at the Company’s sole expense.

 

ARTICLE
V. MISCELLANEOUS

 

5.01         Fees
and Expenses. The Company shall reimburse JGBWL for all costs and expenses incurred by JGBWL in connection with the negotiation,
drafting and execution of the Operative Documents and the transactions contemplated thereby (including all reasonable legal fees,
travel, disbursements and due diligence in connection therewith and all fees incurred in connection with any necessary regulatory
filings and clearances). In addition, the Company shall pay all reasonable fees and expenses incurred by JGBWL in connection with
the enforcement of this Agreement or any of the other Operative Documents, including, without limitation, all reasonable attorneys’
fees and expenses; provided, however, that in the event that the enforcement of this Agreement is contested and it is finally
judicially determined that JGBWL was not entitled to the enforcement of the Operative Document sought, then JGBWL shall
reimburse the Company for all fees and expenses paid pursuant to this sentence. The Company shall be responsible for its own fees
and expenses incurred in connection with the transactions contemplated by this Agreement. The Company shall pay all fees of its
transfer agent, stamp taxes and other taxes and duties levied in connection with the delivery of the Warrant and/or the Warrant
Shares to JGBWL. This provision shall survive termination of this Agreement and the Operative Documents.

 

    	 	4	 

     

    

 

5.02         
Specific Performance; Consent to Jurisdiction; Venue.

 

(a)  
The Company and JGBWL acknowledge and agree that irreparable damage would occur in the event that any of the provisions of this
Agreement or the other Operative Documents were not performed in accordance with their specific terms or were otherwise breached.
It is accordingly agreed that the parties shall be entitled to an injunction or injunctions to prevent or cure breaches of the
provisions of this Agreement or the other Operative Documents and to enforce specifically the terms and provisions hereof or thereof
without the requirement of posting a bond or providing any other security, this being in addition to any other remedy to which
any of them may be entitled by law or equity.

 

(b)  
The parties agree that venue for any dispute arising under this Agreement will lie exclusively in the state or federal courts
located in New York County, New York, and the parties irrevocably waive any right to raise forum non conveniens or any other argument
that New York is not the proper venue. The parties irrevocably consent to personal jurisdiction in the state and federal courts
in New York County of the state of New York. The Company and JGBWL consent to process being served in any such suit, action or
proceeding by mailing a copy thereof to such party at the address in effect for notices to it under this Agreement and agrees
that such service shall constitute good and sufficient service of process and notice thereof. Nothing in this Section 5.02 shall
affect or limit any right to serve process in any other manner permitted by law. The parties hereby waive all rights to a trial
by jury.

 

(c)    Notwithstanding the foregoing, the parties agree that venue for any dispute arising under this Agreement with respect to any security
interests and liens that JGBWL may have on any property of the Company or any of its direct or indirect subsidiaries located in
the United Kingdom or subject to the jurisdiction of English courts will lie exclusively in the English courts located in London,
England, and the parties irrevocably waive any right to raise forum non conveniens or any other argument that such courts are
not the proper venue.

 

5.03         Amendment.
No provision of this Agreement may be waived or amended except in a written instrument signed by the Company and JGBWL.

 

5.04         Notices.
Any notice, demand, request, waiver or other communication required or permitted to be given hereunder shall be in writing and
shall be effective (a) upon hand delivery by telecopy or facsimile at the address or number designated below (if delivered on
a business day during normal business hours where such notice is to be received), or the first business day following such delivery
(if delivered other than on a business day during normal business hours where such notice is to be received) or (b) on the second
business day following the date of mailing by express courier service, fully prepaid, addressed to such address, or upon actual
receipt of such mailing, whichever shall first occur or (c) upon delivery by e-mail (if delivered on a Business Day during normal
business hours where such notice is to be received) upon recipient’s actual receipt and acknowledgement of such e-mail. The addresses
for such communications shall be:

 

	If to the Company:	InterCloud Systems, Inc.
	 	1030 Broad Street, Suite 102
	 	Shrewsbury, NJ 07702
	 	Attention: Chief Financial Officer
	 	Telephone: (732) 898-6320
	 	Facsimile No.:
	 	Email: tlarkin@intercloudsys.com and
	 	dsullivan@intercloudsys.com
	 	 
	If to JGBWL:	JGB (Cayman) Cambridge Ltd.
	 	c/o JGB Management Inc.
	 	21 Charles Street, Suite 160
	 	Westport, CT 06880
	 	Attention: Brett Cohen
	 	Telephone No.: (212) 355-5771
	 	Facsimile No.: (212) 253-4093
	 	E-mail:
                                         bcohen@jgbcap.com

 

    	 	5	 

     

    

  

Any
party hereto may from time to time change its address for notices by giving written notice of such changed address to the other
party hereto.

 

 

5.05       
Waivers. No waiver by either party of any default with respect to any provision, condition or requirement of this Agreement
shall be deemed to be a continuing waiver in the future or a waiver of any other provision, condition or requirement hereof, nor
shall any delay or omission of any party to exercise any right hereunder in any manner impair the exercise of any such right accruing
to it thereafter.

 

5.06         Headings.
The article, section and subsection headings in this Agreement are for convenience only and shall not constitute a part of this
Agreement for any other purpose and shall not be deemed to limit or affect any of the provisions hereof.

 

5.07         Successors
and Assigns. This Agreement shall be binding upon and inure to the benefit of the parties and their successors and assigns.
JGBWL may assign the Warrant and/or the Warrant Shares and its rights under this Agreement and the other Operative Documents and
any other rights hereto and thereto without the consent of the Company. The Company may not assign or delegate any of its rights
or obligations hereunder or under any Operative Document.

 

5.08         No
Third Party Beneficiaries. This Agreement is intended for the benefit of the parties hereto and their respective permitted
successors and assigns and is not for the benefit of, nor may any provision hereof be enforced by, any other person or entity.

 

5.09         Governing
Law. This Agreement shall be governed by and construed in accordance with the internal Jaws of the State of New York, without
giving effect to any of the conflicts of law principles that would result in the application of the substantive law of another
jurisdiction. This Agreement shall not be interpreted or construed with any presumption against the party causing this Agreement
to be drafted.

 

5.10         Survival.
The covenants, agreements and representations and warranties of the Company under the Operative Documents shall survive the execution
and delivery hereof indefinitely.

 

5.11         Counterparts.
This Agreement may be executed in any number of counterparts, all of which taken together shall constitute one and the same instrument
and shall become effective when counterparts have been signed by each party and delivered to the other parties hereto, it being
understood that all parties need not sign the same counterpart. Signature pages to this Agreement may be delivered by facsimile
or other means of electronic transmission.

 

    	 	6	 

     

    

 

5.12        
Publicity. Subject to Section 4.04, the Company agrees that it will not disclose, and will not include in any public announcement,
the names of JGBWL without the consent of JGBWL, which consent shall not be unreasonably withheld or delayed, or unless and until
such disclosure is required by law, rule or applicable regulation, and then only to the extent of such requirement. Notwithstanding
the foregoing, JGBWL consents to being identified in any filings the Company makes with the SEC to the extent required by law
or the rules and regulations of the SEC.

 

5.13         Severability.
The provisions of this Agreement are severable and, in the event that any court of competent jurisdiction shall determine that
any one or more of the provisions or part of the provisions contained in this Agreement shall, for any reason, be held to be invalid,
illegal or unenforceable in any respect, such invalidity, illegality or unenforceability shall not affect any other provision
or part of a provision of this Agreement and this Agreement shall be reformed and construed as if such invalid or illegal or unenforceable
provision, or part of such provision, had never been contained herein, so that such provisions would be valid, legal and enforceable
to the maximum extent possible.

 

5.14         Further
Assurances. From and after the date of this Agreement, upon the request of JGBWL or the Company, the Company and JGBWL shall
execute and deliver such instruments, documents and other writings as may be reasonably necessary or desirable to confirm and
carry out and to effectuate fully the intent and purposes of this Agreement and the other Operative Documents. Except as provided
herein with respect to Section 4.13 of the Securities Purchase Agreement, JGBWL’s rights and remedies under the Securities Purchase
Agreement remain unmodified and in full force and effect.

 

5.15        Time
Is of the Essence. Time is of the essence of this Agreement and each Operative Document.

 

[signature
page follows]

 

    	 	7	 

     

    

 

IN
WITNESS WHEREOF, the parties hereto have caused this Securities Exchange Agreement to be duly executed by their respective authorized
officers as of the date first above written.

 

	INTERCLOUD
    SYSTEMS, INC.	 
	 	 
	By:	/s/
    Daniel Sullivan	 
	Name:	Daniel
                                         Sullivan

	 
	Title:	Chief
    Accounting Office	 
	 	 	 
	JGB
                                         (CAYMAN) WALTHAM LTD.

	 
	 	 
	By:	 	 
	Name:	 	 
	Title:	 	 

 

    	 	8	 

     

    

 

EXHIBIT A

 

FORM
OF WARRANTExhibit 10.4

 

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.

 

COMMON
STOCK PURCHASE WARRANT

 

INTERCLOUD SYSTEMS, INC.

 

THIS
COMMON STOCK PURCHASE WARRANT (the “Warrant”) certifies that, for value received, JGB (Cayman) Waltham Ltd. 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 February 28, 2017 (the “Initial Exercise Date”) and on or prior
to the close of business on November 28, 2018 (the “Termination Date”) but not thereafter, to subscribe for and
purchase from InterCloud Systems, Inc., a Delaware corporation (the “Company”), up to that number of shares of
Common Stock (as defined below) that would result in the Company receiving aggregate proceeds from the exercise of this Warrant
of $1,000,000 (as subject to adjustment hereunder, the “Warrant Shares”). For purposes of the immediately preceding
sentence, in the event of a “cashless exercise” of this Warrant pursuant to Section 2(c), the Company shall be deemed
to have received proceeds equal to the amount of cash that it would have received if this Warrant had been exercised for cash.
The purchase price of one share of common stock of the Company, par value $0.0001 per share, (the “Common Stock”)
under this Warrant shall be equal to the Exercise Price, as defined in Section 2(b). This Warrant has been issued pursuant to
that certain Securities Exchange Agreement (the “Exchange Agreement”), dated February 28, 2017, and, accordingly,
shall be deemed to have an original issue date of December 29, 2015.

 

Section
1.        Definitions. For the purposes hereof, in addition to the terms defined elsewhere in this Warrant, the following terms
shall have the following meanings:

 

“Affiliate”
means any Person that, directly or indirectly through one or more intermediaries, controls or is controlled by or is under common
control with a Person, as such terms are used in and construed under Rule 405 under the Securities Act.

 

    	 	1	 

     

    

 

“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 banking institutions in the State of New York are authorized or required by law or other governmental action
to close.

 

“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.

 

“Fixed
Price” means $0.04, subject to adjustment as provided herein.

 

“Person”
means an individual or corporation, partnership, trust, incorporated or unincorporated association, joint venture, limited liability
company, joint stock company, government (or an agency or subdivision thereof) or other entity of any kind.

 

“Rule
144” means Rule 144 promulgated by the United States Securities and Exchange Commission pursuant to the Securities Act,
as such Rule may be amended from time to time, or any similar rule or regulation hereafter adopted by the Commission having substantially
the same effect as such Rule.

 

“Subsidiary”
means any subsidiary of the Company existing on the date hereof and any 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 trading.

 

“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 MKT, the Nasdaq Capital Market, the Nasdaq Global Market, the Nasdaq Global Select Market,
the New York Stock Exchange, or any U.S. trading market operated by the OTC Markets Group, Inc. (or any successors to any of
the foregoing).

 

“Transfer
Agent” means Corporate Stock Transfer, Inc., the current transfer agent of the Company, with a mailing address of 3200
Cherry Creek South Drive, Suite 430, Denver, Colorado 80209 and a facsimile number of (303) 282-5800, and any successor transfer
agent of the Company.

 

“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 the Common Stock is not then listed
or quoted for trading on a Trading Market and if prices for the Common Stock are then reported in the “Pink Sheets”
published by Pink 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 (c) 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 and reasonably acceptable to the
Company, the fees and expenses of which shall be paid by the Company.

 

    	 	2	 

     

    

 

Section
2.        Exercise.

 

a)       Exercise
of Warrant. 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 in the form annexed hereto (the “Notice
of Exercise”) and within three (3) Trading Days of the date said Notice of Exercise is delivered to the Company, the
Company shall have received payment of the aggregate Exercise Price of the shares thereby purchased by wire transfer or cashier’s
check drawn on a United States bank or pursuant to the cashless exercise procedure specified in Section 2(c) below. 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 form be required. Notwithstanding anything herein to the contrary, 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 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.

 

b)       Exercise
Price. The exercise price per share of the Common Stock under this Warrant on the date that any exercise of this Warrant is
effected (such date, an “Exercise Date”) shall be equal (x) if the Exercise Date is prior to May 29, 2017, the
Fixed Price then in effect and (y) if the Exercise Date is on or after May 29, 2017, the lower of: (a) the Fixed Price then in
effect and (b) 80% of the lowest daily VWAP for the thirty (30) consecutive Trading Day period immediately preceding the applicable
Exercise Date.

 

    	 	3	 

     

    

 

c)       Cashless
Exercise. If at any time the Initial Exercise Date there is no effective registration statement under the Securities Act of
1933, as amended, registering, or no current prospectus available for, the resale of the Warrant Shares by the Holder, this Warrant
may also be exercised, in whole or in part, at any 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, this Warrant shall be automatically exercised via cashless exercise
pursuant to this Section 2(c).

 

		d)	Mechanics
                                         of Exercise.

 

i.       Delivery
of Warrant Shares Upon Exercise. Warrant Shares purchased hereunder shall be transmitted by 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 shares are eligible for resale by the Holder without volume or manner-of-sale limitations
pursuant to Rule 144, and otherwise by physical delivery to the address specified by the Holder in the Notice of Exercise by the
date that is one (1) Trading Day after the delivery to the Company of the Notice of Exercise (such date, the “Warrant
Share Delivery Date”). Notwithstanding anything contained herein to the contrary, the Company shall deliver any certificate
or certificates required to be delivered by the Company under this Section 2(d) electronically through DTC without any restrictive
legends provided that (i) (x) the Holder elected to exercise this Warrant by means of a “cashless exercise” and the
Company is in compliance with the current public information requirements of Rule 144 or (y) there is an effective registration
statement covering the resale of the Warrant Shares by the Holder and (ii) the Holder has delivered to the Company a broker representation
letter that the shares of Common Stock represented by such certificates have been sold pursuant to Rule 144 or such effective
registration statement. The Company shall cause, at their own expense, Pryor Cashman LLP to provide any legal opinions required
to deliver shares free of restrictive legends pursuant to this Section 2(d). 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. If the Company fails for any reason to deliver to the Holder the Warrant Shares subject
to a Notice of Exercise by the second Trading Day following 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 second Trading Day
following the Warrant Share Delivery Date until such Warrant Shares are delivered or Holder rescinds such exercise.

 

    	 	4	 

     

    

 

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(d)(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 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 shares of Common Stock upon exercise of the Warrant as required pursuant to the terms hereof.

 

    	 	5	 

     

    

 

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.

 

    	 	6	 

     

    

 

e)         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), 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 otherCommon 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 United States Securities and Exchange 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, upon not less than 61 days’
prior notice to the Company, may increase or decrease 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 or decrease 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.

 

    	 	7	 

     

    

 

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 Fixed 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. 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)	Intentionally
                                         Omitted.

  

    	 	8	 

     

    

 

c)       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).

 

d)       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 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).

 

    	 	9	 

     

    

 

e)       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(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
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 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.

 

    	 	10	 

     

    

 

f)       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.

 

		g)	Notice
                                         to Holder.

 

i.       Adjustment
to Fixed Price. Whenever the Fixed Price is adjusted pursuant to any provision of this Section 3, the Company shall promptly
mail to the Holder a notice setting forth the Fixed 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, 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 mailed to the Holder at its last address as it shall appear upon the Warrant Register (as defined
below) 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 United States Securities and Exchange
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.

 

    	 	11	 

     

    

 

Section 4.        Transfer of Warrant.

 

a)       Transferability.
Subject to compliance with any applicable securities laws, 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. Notwithstanding anything herein to the contrary, 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 the Holder delivers an assignment form to the Company assigning
this Warrant full. 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
Exercise Date and shall be identical with this Warrant except as to the number of Warrant Shares issuable pursuant thereto.

 

    	 	12	 

     

    

 

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.

 

d)       Representation
by the Holder. The Holder, by the acceptance hereof, represents and warrants that it is acquiring this Warrant and, upon any
exercise hereof, will acquire the Warrant Shares issuable upon such exercise, for its own account and not with a view to or for
distributing or reselling such Warrant Shares or any part thereof in violation of the Securities Act or any applicable state securities
law, except pursuant to sales registered or exempted under the Securities Act.

 

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(d)(i), except as expressly set forth in
Section 3.

 

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

 

		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).

 

    	 	13	 

     

    

 

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)       Jurisdiction.
This Warrant shall be governed by and construed in accordance with the internal laws of the State of New York without regard to
any laws that would require the applications of the laws of another jurisdiction. The Company and the Holder submit to the exclusive
jurisdiction of the state and federal courts located in New York County, New York for any action dispute or proceeding arising
out of this Agreement.

 

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.

 

    	 	14	 

     

    

 

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, notwithstanding the fact that all rights
hereunder terminate on the Termination Date. 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
to the holder by overnight mail to c/o JGB Management, Inc. 21 Charles Street, Westport, CT 06880 and by e-mail to bcohen@jgbcap.com.

 

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.

 

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.

 

1)       Amendment.
This Warrant may be modified or amended or the provisions hereof waived with the written consent of the Company and the Holder.

 

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.

 

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)

 

    	 	15	 

     

    

 

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.

 

	 	INTERCLOUD
    SYSTEMS, INC.
	 	 	 
	 	By:	/s/
    Timothy A. Larkin
	 	Name: 	Timothy A. Larkin
	 	Title:	CFO

 

    	 	16	 

     

    

 

NOTICE
OF EXERCISE

 

	TO:	INTERCLOUD
    SYSTEMS,     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)	Exercise
                                         Price: $  _________

 

		(3)	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).

 

(4)  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:

________________________

________________________

________________________

 

(4)  Accredited
Investor. The undersigned is an “accredited investor” as defined in Regulation D promulgated under the
Securities Act of 1933, as amended.

 

[SIGNATURE
OF HOLDER]

 

Name
of Investing Entity: ______________________________________________________________________________________________

Signature
of Authorized Signatory of Investing Entity: ________________________________________________________________________

Name of Authorized Signatory: __________________________________________________________________________________________

Title
of Authorized Signatory: ___________________________________________________________________________________________

Date:
_______________________________________________________________________________________________________________

 

     

     

    

 

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)

 

Dated:______________,___

Holder’s
Signature: _____________________

Holder’s
Address: ______________________

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